Janvrin v. Continental Resources, Inc.

Filing 34

MEMORANDUM OPINION AND ORDER denying 26 Motion in Limine; granting 27 Motion to Extend Deadlines ( Discovery due by 11/12/2016). Signed by U.S. District Judge Karen E. Schreier on 9/1/2016. (JLS) Modified to add text on 9/1/2016 (JLS).

UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH DAKOTA
SOUTHERN DIVISION
JERRY JANVRIN
d/b/a J&J TRUCKING,

4:14 CV-04124-KES

Plaintiff,

MEMORANDUM OPINION
AND ORDER

vs.
CONTINENTAL RESOURCES, INC., an
Oklahoma Corporation,
Defendant.

Plaintiff, Jerry Janvrin d/b/a J&J Trucking, moves for leave to supplement
his Rule 26(a) disclosures and responses to discovery requests regarding the
damage and computation for lost income. Docket 27. Defendant, Continental
Resources Inc., opposes the motion. Docket 31. The motion to supplement is
granted.
BACKGROUND
On July 15, 2014, plaintiff filed a complaint alleging that defendant
tortiously interfered with plaintiff’s business relations and sought the following
damages: loss of income, loss of value of business, loss of business reputation,
costs for equipment, and all general and special damages permitted under South
Dakota law. Docket 1-3 at 4-5. On October 8, 2014, plaintiff provided defendant
with his Rule 26(a) disclosures, but plaintiff did not include computations of the
amount of damages sought. Docket 26-1; Docket 26-2. Instead, plaintiff indicated
that his damages would be quantified by an expert. Plaintiff, however, did not

disclose an expert witness by the May 1, 2015 deadline. Further, in his responses
to defendant’s interrogatories, plaintiff did not identify the amount of claimed
damages he planned to seek at trial. Docket 26-3; Docket 26-4. When the
discovery deadline for this case ended September 1, 2015, plaintiff had not
disclosed a computation of his claimed damages. On July 5, 2016, defendant
moved this court to exclude evidence of plaintiff’s damages pursuant to Fed. R.
Civ. P. 37(c)(1). Docket 26 at 1.
On July 20, 2016, plaintiff moved this court, pursuant to Fed. R. Civ. P.
26(e)(1)(B) and Fed. R. Civ. P. 16(b)(4), to allow plaintiff to supplement his
disclosures. Docket 27. Plaintiff acknowledges that he failed to comply with Rule
26. Docket 28 at 1-4. But he argues that he was not able to provide his 2013
federal income tax return within the discovery period (Docket 33 at 3), defendant is
not unduly prejudiced by admitting the evidence, and complete exclusion of the
evidence is too harsh of a sanction. Docket 28 at 1-4.
Plaintiff did not properly disclose evidence pursuant to Rule 26(a)(1)(A)(iii)
and Rule 26(e)(1)(A) because he did not provide defendants with a computation of
his damages within the designated discovery period. Therefore, the issues
presented to the court are: (1) whether the violation was substantially justified or
harmless, and (2) whether exclusion of the evidence is the appropriate remedy.
DISCUSSION
I.

An Untimely Disclosure of a Computation of Damages.
Federal Rule of Civil Procedure 26(a)(1)(A)(iii) requires parties to make initial

disclosures, including a computation of damages, and parties must supplement
their initial disclosures when they learn of new information. Fed. R. Civ. P.

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26(e)(1)(A). If a party fails to satisfy an initial or supplemental disclosure, the court
has discretion to apply appropriate sanctions. Fed. R. Civ. P. 37(c)(1). An untimely
disclosure is considered a nondisclosure. Trost v. Trek Bicycle Corp., 162 F.3d
1004, 1008 (8th Cir. 1998). The “discretion to fashion a remedy or sanction” is
“wide,” but “narrows as the severity of the sanction or remedy . . . increases.”
Wegener v. Johnson, 527 F.3d 687, 692 (8th Cir. 2008). To aid the district court in
determining whether a failure to disclose is substantially justified or harmless and
to fashion an appropriate sanction, the Eighth Circuit has provided a four-part
balancing test. This balancing test considers “the reason for noncompliance, the
surprise and prejudice to the opposing party, the extent to which allowing the
information or testimony would disrupt the order and efficiency of the trial, and
the importance of the information or testimony.” Id.
A.

Whether plaintiff’s failure to properly disclose a computation of
his damages was substantially justified.
When considering whether a party’s failure to disclose is justified, the court

evaluates a variety of factors including the availability of the evidence, the party’s
knowledge of the relevancy of the evidence, and whether the party ever moved the
court for additional time to gather the evidence. See Trost, 162 F.3d at 1008
(finding that failure to disclose was not justified when plaintiff did not hire an
expert until after defendant produced its expert report and never sought an
extension of the deadline); Wegener, 527 F.3d at 692-93 (finding that the failure to
disclose was not justified because the needed hospital records were easily
discoverable and highly relevant); Carmody v. Kan. City Bd. Of Police Comm’rs, 713
F.3d 401, 405 (8th Cir. 2013) (finding that the failure to disclose was not justified

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by the substantial volume of documents because the officers never moved for
additional time to review the documents).
In this case, plaintiff argues that the failure to disclose a computation of
damages is justified because the mistake was inadvertent and arose when plaintiff
decided not to retain a damages expert. Docket 30 at 4. Plaintiff also argues that
he was unable to produce his 2013 tax return to defendant until after the
discovery deadline because the tax return was not completed. Docket 33 at 3. This
argument is similar to the justifications presented in Trost where the plaintiff
argued that his failure to disclose resulted from the need to respond to the
defendant’s expert. Trost, 162 F.3d at 1008. The court in Trost found that, if the
plaintiff required more time to respond to the defendant, the plaintiff should have
moved the court for additional time. Id. A party cannot claim the lack of sufficient
time as a substantial justification to a violation of the Civil Rules of Procedure
when that same party made no effort to gain more time. Therefore, plaintiff was
not substantially justified in not disclosing a computation of his damages within
the discovery period.
B.

Whether plaintiff’s untimely disclosure of a computation of
damages was harmless.
When considering whether a failure to disclose was harmless, the court

considers “the surprise and prejudice to the opposing party, the extent to which
allowing the information or testimony would disrupt the order and efficiency of
trial, and the importance of the information.” Wegener, 527 F.3d at 692. See Trost,
162 F.3d at 1008-09 (finding that the admission of the evidence would not be
harmless because it would disrupt the court’s trial calendar and the other party

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would not have time to properly prepare); Tenbarge v. Ames Taping Tool Sys, Inc.,
190 F.3d 862, 865 (8th Cir. 1999) (finding that the failure to supplement was not
harmless because the other party could not adequately cross examine an expert
witness); Wegener, 527 F.3d at 692 (finding that the admission of the evidence was
not harmless because it would have postponed an already much-delayed trial and
would not have provided the other party time to adequately prepare); Carmody,
713 F.3d at 405 (finding that the admission of the evidence would not be harmless
because it would reopen discovery and prolong the litigation).
The failure to disclose at issue in this case deviates substantially from past
instances that the court found to be harmful. In Trost, the court found that the
failure to disclose was not harmless because the admission of the evidence would
disrupt the trial calendar, and in Tenbarge, the court found that the failure to
disclose an expert witness was not harmless because the other party was unable
to adequately prepare for cross examination. Trost, 162 F.3d at 1008-09;
Tenbarge, 190 F.3d at 865. In Wegener and Carmody, the court found that the
failure to disclose was not harmless because admitting the evidence would further
delay an already much-delayed trial. Wegener, 527 F.3d at 692; Carmody, 713
F.3d at 405. Here, the court has not set a trial date, this litigation has not been
plagued with delays, and the court will ensure that the defendant will have
adequate time to prepare for cross examination. Given the circumstances, the
court finds that the plaintiff’s failure to disclose his computation of damages was
harmless.

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II.

Whether exclusion of the damages is the appropriate remedy.
“While sanctions under Rule 37(c)(1) are mandatory . . . exclusion of

evidence should not apply if the offending party’s failure was ‘substantially
justified,’ or if the failure was ‘harmless.’ ” North Star Mut. Ins. Co. v. Zurich Ins.
Co., 269 F. Supp. 2d 1140, 1145 (D. Minn. 2003) (quoting Transclean Corp. v.
Bridgewood Servs. Inc, 77 F. Supp. 2d 1045, 1064 (D. Minn. 1999), rev’d on other
grounds, 290 F.3d 1364 (2002)). Because plaintiff’s failure to disclose was
harmless, this court will not exclude the evidence nor impose sanctions.
CONCLUSION
The plaintiff’s failure to timely disclose his computation of damages under
Rule 26(a) was not substantially justified, but it was harmless. This court grants
plaintiff’s motion and extends the discovery deadline until November 12, 2016.
Plaintiff must supplement his disclosures and provide defendant with the
computations of plaintiff’s damages by September 12, 2016. Defendant will then
have two months to conduct discovery regarding the damages issues. It is
ORDERED
(1) defendant’s motion to exclude (Docket 26) is denied, and
(2) plaintiff’s motion to extend deadlines (Docket 27) is granted.
Dated September 1, 2016.

BY THE COURT:
/s/ Karen E. Schreier
KAREN E. SCHREIER
UNITED STATES DISTRICT JUDGE
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