Lafarge North America, Inc v. Wallboard Materials, LLC et al

Filing 30

ORDER granting 26 Motion to for Permission to Answer Requests for Admissions Nunc Pro Tunc. Signed by Judge Jon Phipps McCalla on 10/28/13. (McCalla, Jon)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
WESTERN DISTRICT

LAFARGE NORTH AMERICA, INC.,

)
)
Plaintiff/Counter-Defendants, )
)
v.
)
)
WALLBOARD MATERIALS, LLC;
)
PHIL C. CHAMBERLAIN, II,
)
individually; JON E. McCREERY,
)
individually; and
)
ROBERT BINGHAM, III, individually, )
)
Defendants/Counter-Plaintiffs.)

No. 2:13-cv-02151-JPM-tmp

ORDER GRANTING DEFENDANTS/COUNTER-PLAINTIFFS’ MOTION FOR
PERMISSION TO ANSWER REQUESTS FOR ADMISSIONS NUNC PRO TUNC

Before the Court is Defendants/Counter-Plaintiffs Wallboard
Materials, LLC, Phil C. Chamberlain, II, Jon E. McCreery, and
Robert Bingham, III’s (collectively “Defendants” or “Wallboard”)
Motion for Permission to Answer Requests for Admissions Nunc Pro
Tunc, filed on September 17, 2013.

(Defs.’ Mot. to Answer

Requests Nunc Pro Tunc (“Defs.’ Mot.”), ECF No. 26.)
Plaintiff/Counter-Defendant LaFarge North America, Inc.
(“Plaintiff” or “LaFarge”), filed its Response in Opposition on
September 27, 2013.

(Pl.’s Resp., ECF No. 27.)

For the reasons stated below, the instant Motion is
GRANTED.

I.

Background
LaFarge filed the instant case against Wallboard on March

8, 2013, alleging breach of certain promissory notes signed by
Wallboard and the individually named Defendants and breaches of
contract and personal guarantee.

(ECF No. 1.)

Wallboard filed

its Answer and Counterclaim against LaFarge on April 18, 2013.
(Answer by Defs./Counter-Pls., ECF No. 19.)

LaFarge filed its

Answer to Wallboard’s Counterclaim on May 6, 2013.

(ECF No.

21.)
The Court entered a Scheduling Order in the instant case on
April 5, 2013.

(ECF No. 17.)

In the Order, the Court set the

deadline for document production, interrogatories, and requests
for admissions as August 30, 2013.

(Id. at 2.)

On July 26, 2013, LaFarge filed a Notice of Service of
Written Discovery, noting that it had “served upon the
defendants . . . Plaintiff’s First Request for Admissions;
Plaintiff’s First Set of Interrogatories; and Plaintiff’s First
Requests for Production of Documents.”

(ECF No. 22 at 1.)

Since the filing of the Complaint, the parties have been
engaged in settlement discussions.

According to emails filed

with LaFarge’s Response in Opposition, Wallboard made an offer
of settlement to LaFarge on August 7, 2013.

(Email from Matthew

P. Taunt to Derek E. Whitlock (Aug. 15, 2013) (“August 15
email”) at PageID 156-57, ECF No. 27-1.)
2 

On August 15, 2013,

LaFarge rejected Wallboard’s offer and proposed a different
settlement agreement.

(Id.)

On August 27, 2013, Wallboard

responded to LaFarge’s settlement offer stating it “would like
to offer the following counter-proposal.”

(Email from Derek E.

Whitlock to Matthew P. Taunt (Aug. 27, 2013) (“August 27 email”)
at PageID 158-59, ECF No. 27-1.)

On September 3, 2013, LaFarge

withdrew its offer and stated it “would not authorize any
settlements that run longer than [a payment period of] 8
months,” but stated that it believed the amount of Wallboard’s
settlement offer was acceptable.

(Email from Matthew P. Taunt

to Derek E. Whitlock (Sept. 3, 2013) (“Sept. 3 email”) at
PageID 161, ECF No. 27-1; see also Taunt Aff. ¶ 20, ECF No. 27-1
at PageID 154.)
Wallboard filed its Responses to Plaintiff/CounterDefendant’s Requests for Admissions on September 16, 2013.
No. 24.)

(ECF

Wallboard filed the instant Motion requesting

permission to file its untimely answers to LaFarge’s requests
for admissions nunc pro tunc on September 17, 2013.1

(Defs.’

Mot., ECF No. 26.)
Pursuant to Federal Rule of Civil Procedure 36(b),
Wallboard seeks to withdraw its admissions and amend them with
the September 16, 2013, Response (see ECF No. 24).

(Defs.’ Mot.

1

Wallboard first attempted to file the instant Motion on September 16, 2013,
but had to refile the Motion the following day as the result of a filing
deficiency. (See ECF No. 25.)
3 

at 1-3, ECF No. 26.)

LaFarge filed its Response in Opposition

on September 27, 2013.
II.

(Pl.’s Resp., ECF No. 27.)

Standard of Review
Pursuant to Federal Rule of Civil Procedure 36(a), after a

party serves another party with requests for admission, “[a]
matter is deemed admitted unless, within 30 days after being
served, the party to whom the request is directed serves on the
requesting party a written answer or objection addressed to the
matter and signed by the party or its attorney.”

Fed. R. Civ.

P. 36(a)(3).
Pursuant to Rule 36(b), “[a] matter admitted . . . is
conclusively established unless the court, on motion, permits
the admission to be withdrawn or amended.”
36(b).

Fed. R. Civ. P.

Rule 36(b) also provides a two-prong test in determining

whether to permit withdrawal of an admission, “Subject to Rule
16(e), the court may permit withdrawal or amendment [1] if it
would promote the presentation of the merits of the action and
[2] if the court is not persuaded that it would prejudice the
requesting party in maintaining or defending the action on the
merits.”

Id.; see also Medtronic Sofamor Danek, Inc. v.

Michelson, No. 01-2373 MLV, 2004 WL 179310, at *2 (W.D. Tenn.
Jan. 2, 2004).
With regard to prejudice,

4 

[t]he prejudice contemplated by [Rule 36(b)] is not
simply that the party who initially obtained the
admission will now have to convince the fact finder of
its truth.
Prejudice under Rule 36(b), rather,
relates to special difficulties a party may face
caused by a sudden need to obtain evidence upon
withdrawal or amendment of an admission.
Kerry Steel, Inc. v. Paragon Indus., Inc., 106 F.3d 147, 154
(6th Cir. 1997) (alterations in original) (citations omitted)
(internal quotation marks omitted).

Further, “the burden is on

the party who obtained the admission to satisfy the court that
he would be prejudiced if the admission is withdrawn.”
Medtronic Sofamor Danek, Inc., 2004 WL 179310, at *3.
III. Analysis
Wallboard first attempts to excuse its untimely filing
by stating that the parties were involved in ongoing
settlement negotiations and that “Wallboard and LaFarge had
agreed in principle to a settlement agreement on or about
August 30, 2013.”

(Defs.’ Mot. at 1-2, ECF No. 26.)

Review of the submitted emails and the affidavit of
LaFarge’s counsel indicate this argument is unavailing.
The emails submitted with LaFarge’s opposition brief
indicate there was no agreement “in principle,” rather
Wallboard made a counter-offer to LaFarge’s settlement
offer.

(See August 27 email at PageID 158, ECF No. 27-1.)

The affidavit of LaFarge’s counsel states that LaFarge
rejected Wallboard’s counter-offer on August 28, 2013, and
5 

that on August 30, 2013, there was more discussion between
the parties regarding settlement terms, but that these
terms were “never accepted by the Defendants.”

(Taunt Aff.

¶¶ 15-21, ECF No. 27-1 at PageID 153-54.)
Further, it is undisputed that Wallboard did not
timely file its Answers to LaFarge’s Requests for
Admissions, and that those requests are, therefore,
admitted.

(See Defs.’ Mot. at 2, ECF No. 26 (“Wallboard

readily admits that it did not file Answers to Requests for
Admissions timely . . . .”).)

Accordingly, the only issue

before the Court is whether withdrawal and amendment of
those admissions is proper under Rule 36(b).
The first prong under Rule 36(b) is whether withdrawal
of admissions “would promote the presentation of the merits
of the action,” which “is satisfied ‘when upholding the
admission would practically eliminate any presentation on
the merits of the case.’”

Riley v. Kurtz, 194 F.3d 1313

(6th Cir. 1999) (unpublished table decision) (quoting
Hadley v. United States, 45 F.3d 1345, 1348 (9th Cir.
1995)); accord Medtronic Sofamor Danek, Inc., 2004 WL
179310, at *2.
In the instant case, Wallboard’s proposed Answers to
the Requests for Admissions admit that Defendants executed
the 2011 Promissory Note, the 2009 Security Agreement, the
6 

Chamberlain Guaranty, the McCreery Guaranty, and the
Bingham Guaranty; admit that Defendants were represented by
legal counsel when these documents were signed; state that
the 2011 Promissory Note and the Chamerlain, McCreery, and
Bingham Guarantees all speak for themselves; and admit that
LaFarge supplied product to Wallboard after the execution
of the 2011 Promissory Note.

(See ECF No. 24 at Response

Nos. 1-3, 5, 7, 9-18, 21.)
The remaining requests for admissions relate to
Wallboard’s defenses and counterclaims, namely that each
Defendant “read, reviewed, and understood” the guarantees
(see id. at Request Nos. 4, 6, 8); that LaFarge had “never
promised to continue to supply product to Wallboard upon
execution” of the notes and guarantees (see id. at Request
Nos. 19, 22-23); and the amount of relief sought by LaFarge
(see id. at Request No. 24).

Having been admitted by

operation of Rule 36(a), Wallboard seeks to withdraw and
amend these admissions.
Having reviewed the record, the Court finds that
preventing Wallboard from withdrawing and amending these
admissions would preclude Wallboard from presenting
evidence relating to its defenses and counterclaims.
Answer by Defs./Counter-Pls., ECF No. 19.)

As a result,

these admissions may go to the merits of the case and
7 

(See

allowing Wallboard to withdraw and amend them may “promote
the presentation of the merits of the action.”
Accordingly, Wallboard appears to have satisfied the first
prong of Rule 36(b).2
With regard to the second prong for the proper
withdrawal of admissions under Rule 36(b), whether there
will be prejudice to the party obtaining the admission,
“the burden is on the party who obtained the admission to
satisfy the court that he would be prejudiced if the
admission is withdrawn.”

Medtronic Sofamor Danek, Inc.,

2004 WL 179310, at *3.
LaFarge argues it will be prejudiced “by having to
engage in further discovery and incur additional attorney’s
fees and expenses that are completely unnecessary” as it
believes Wallboard’s proposed Answers to the Requests for
Admissions “admit all critical issues before the Court.”
(Pl.’s Resp. ¶¶ 8-9, ECF No. 27.)

LaFarge also asserts

that Wallboard should be precluded from withdrawing the
admissions because all of its denials rely on parol
evidence that is inadmissible and “[t]hus, there is no
reasonable factual or legal basis from which to grant the

2

Regarding Wallboard’s proposed objections to Request Nos. 14, 15, 17, and
18, the Court finds these objections appear to relate to Wallboard’s defenses
and counterclaims and, therefore, also may relate to the merits of the case.
8 

defendants’ motion.”

(Pl.’s Mem. at 2, ECF No. 27-5; see

also id. at n.1.)
Wallboard argues that LaFarge will not suffer
prejudice because the deadline for filing dispositive
motions is January 31, 2014, which gives LaFarge “five (5)
months to acquire and prepare any and all evidence
necessary to present its case.”
26.)

(Defs.’ Mot. at 3, ECF No.

Wallboard also asserts that, because the dispute

“surrounds the execution and negotiation of closely related
agreements between the parties, . . . no extensive
discovery is necessary nor are there unrelated or unnamed
parties that could cause delay.”

(Id.)

The Court finds LaFarge has not met its burden to show
it will be prejudiced by the withdrawal and amendment of
Wallboard’s admissions.

Pursuant to the case law of this

circuit, LaFarge has not shown any “special difficulties
[it] may face caused by a sudden need to obtain evidence
upon withdrawal or amendment of an admission.”
Steel, Inc., 106 F.3d at 154.

See Kerry

To the contrary, the Court

agrees that any prejudice to LaFarge is minimal as
discovery has not yet closed, the dispositive motions
deadline is January 31, 2014, and there is no indication of
any sudden need to obtain evidence that is precipitated by
the withdrawal of the admissions.
9 

Accordingly, Defendants’ Motion for Permission to
Answer Requests for Admissions Nunc Pro Tunc is GRANTED.

IT IS SO ORDERED, this 28th day of October, 2013.

/s/ Jon P. McCalla
U.S. DISTRICT COURT JUDGE

10