ASHTON WOODS HOLDINGS L.L.C. et al v. USG CORPORATION et al
MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE MICHAEL M. BAYLSON ON 5/23/2017. 5/23/2017 ENTERED AND COPIES E-MAILED TO LIAISON COUNSEL. (SEE PAPER # 593 IN 13-MD-2437) (ems)
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
IN RE: DOMESTIC DRYWALL
THIS DOCUMENT RELATES TO:
MDL No. 13-2437
Ashton Woods Holdings LLC, et al.,
USG Corp., et al.,
REQUESTS FOR ADMISSION TO PLAINTIFFS
Defendants have filed a Motion to Compel Responses to Defendants’ Second Set of Joint
Requests for Admission to Plaintiffs (ECF 200). The Court has reviewed the Response (ECF
209) and the Reply Brief (ECF 212).
This antitrust case presents claims by twelve large
homebuilders located throughout the United States, seeking damages for alleged price-fixing of
domestic drywall. There has already been extensive document discovery in this case. One of the
lingering discovery issues is to what extent the individual Plaintiffs must provide detailed
information to defendants about Plaintiffs’ purchases of drywall during the relevant time period.
The Homebuilder Plaintiffs assert that they have produced all of their purchase records
for domestic drywall, within their possession, custody or control, which they can locate.
Defendants have been seeking additional detailed information, particularly the identity of the
manufacturer of each lot of drywall purchased by Plaintiffs, and the unit cost (e.g., price per
square foot or linear foot). Plaintiffs have consistently represented that they often do not know,
and cannot find, the identity of the manufacturer of each lot of drywall they may have purchased,
as they often purchase from wholesalers or other “jobbers” and do not need to know the
manufacturer. It is apparent that some drywall is sold without identifying the name of the
manufacturer on the drywall pieces. Also, when purchased, the identity of the manufacturer may
not be disclosed on purchase documents.
Underlying this is the economics of the industry; domestic drywall is essentially a generic
product that does not necessarily vary in quality from one manufacturer to another. Price,
delivery costs, promptness of availability, etc. are often the determinative factors in the purchase
of drywall. The Court is aware that depositions are about to begin in this case. The Court has
commented at various discovery conferences that Plaintiffs may and should seek out information
from the individual Defendants, and vice versa, on purchasing practices, from representatives of
each Plaintiff and each Defendant with knowledge on these topics.
By order dated December 22, 2016 (ECF 168), the Court recognized the importance of
plaintiffs producing all of their information on purchases of drywall in the United States for the
calendar years 2010-2015, and required sworn certifications by appropriate officers of each
Plaintiff supporting each Plaintiffs’ production of its purchase records. The Court understands
that each Plaintiff has complied. However, Defendants assert that the compliance has not been
necessarily complete, as to Plaintiffs producing all information they may have in their
possession, custody or control. For example, Plaintiffs refer to searching of “data fields” only.
Defendants assert they do not know what has been included or may have been omitted by such a
Plaintiffs have taken the fairly consistent (and quite probably accurate) position that they
do not have records showing the identity of the manufacturer of the drywall that they purchased,
or the unit cost, and made representations in open court to this effect. The Court has suggested,
in the depositions (which are about to start), would be questions and testimony from
representatives of both Plaintiffs and Defendants as to what records were or were not received or
maintained on these issues, and explaining the reference to “data fields.”
Recently, Defendants served Requests for Admission, pursuant to Rule 36, Fed. R. Civ.
P., requesting each Plaintiff to “admit” that it did not have the information sought by Defendants,
which would admissible at the trial and arguably serve as a “guarantee” that Plaintiffs were not
going to be able to come forward with this information at trial. Obviously, Defendants believe
that this discovery strategy may help limit damages in the event that the Plaintiffs can establish
liability. In addition, in the event that there are settlement discussions between the parties,
having admissions of record may provide negotiating points between the parties.
Plaintiffs’ object primarily that the Defendants’ Requests for Admission are untimely and
that the deadline for written discovery has long passed. Plaintiffs claim that Defendants should
have sought leave of Court to serve these Requests for Admission. Defendants, in their reply,
assert that the Requests are late because the transactional data was very late coming from
Plaintiffs, that Defendants have acted in a prompt manner and that the issue is important.
If Plaintiffs cannot provide more details, particularly on the amount of damages which
may have been suffered and/or which can be recovered are large, Defendants are entitled to
finality of what information Plaintiffs have. The Court is not ruling that this detailed information
is necessary before Plaintiffs can assert damage claims or prove damages at trial. The ruling is
limited to making all relevant information available during the discovery phase of this case.
In part because of the large amount of damages which are potentially recoverable in this
case, the Court has stated from the very beginning that both parties will be required to do
significant discovery searches, and provide detailed information to the opposing party. If the
identity of the manufacturer was known, or can subsequently be discovered, this information
may be very useful in allocating damages among different Defendants, whether for settlement
purposes or trial. Thus, the information sought is potentially relevant. The unit cost may also be
an important “marker” of profitability, or sales dollar volume, and is likewise relevant.
Therefore, the Court will overrule the Plaintiffs’ objections to the Requests for
Admission and grant the Motion to Compel, but will expand the response deadline to September
10, 2017, for several reasons.
First, some of the information sought by the Requests for
Admission may be tendered by individual Plaintiffs during the deposition program in which
event, counsel for those Plaintiffs will be able to cross-reference actual deposition testimony in
their response to the Requests for Admission. Second, the deposition program itself may warrant
additional documents coming to light that an individual Plaintiff might find appropriate to cite in
its response to the Request for Admission. Third, after the depositions are completed, a Plaintiff
can appropriately represent whatever information it does or does not have, and make a more
informative response to the Request for Admission.
However, the Court believes that Requests for Admission are an underused, but in this
case, appropriate discovery tool for Defendants to get assurance that Plaintiffs have tendered
whatever information, whether documentary or otherwise, each Plaintiff has in support of its
significant claim for damages.
Thus, the Court will grant Defendants’ Motion to Compel subject to the time extension
and interpretations set forth above. An appropriate order follows.
O:\13-MD-2437 - drywall\15-1712 - Memorandum re Pending Requests for Admissions to Plaintiffs.docx
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