Hofmann et al v Hall et al
Filing
497
ORDER denying 446 Motion to Strike Defendants' Answer and Enter Default. Signed by Judge Dee Benson on 9/9/2019. (jwt)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF UTAH, CENTRAL DIVISION
ELLIS-HALL CONSULTANTS, LLC; a
Utah limited liability company; and
ANTHONY HALL, an individual,
Plaintiffs,
v.
GEORGE B. HOFFMAN IV, an individual;
PARSONS KINGHORN HARRIS NKA
COHNE KINGHORN, P.C., a Utah
professional corporation; MATTHEW M.
BOLEY, an individual; KIMBERLY L.
HANSEN, an individual; GARY E.
JUBBER, an individual; and DAVID R.
HAGUE, an individual, FABIAN &
CLENDENIN NKA FABIAN VANCOTT,
P.C., a Utah professional corporation,
Defendants.
In re:
RENEWABLE ENERGY
DEVELOPMENT CORPORATION,
Debtor,
ELIZABETH R. LOVERIDGE, Chapter 7
Trustee,
v.
Plaintiff,
TONY HALL; ELLIS-HALL
CONSULTANTS, LLC; SUMMIT WIND
POWER, LLC, SSP, A Trust (Scott
Rasmussen – Trustee), and DOES I-X,
Defendants.
ORDER DENYING PLAINTIFFS’
MOTION TO STRIKE DEFENDANTS’
ANSWER AND ENTER DEFAULT
Consolidated Case No. 2:12-CV-771
(Consolidated from Case No. 2:15-CV-913)
Judge Dee Benson
SUMMIT WIND POWER, LLC
v.
Counterclaimants,
GEORGE HOFMANN, Chapter 7 Trustee,
Counterclaim Defendant.
SUMMIT WIND POWER, LLC, and
KIMBERLY CERUTI, an individual,
Third-Party Plaintiffs,
v.
PARSONS KINGHORN HARRIS, a
professional corporation; GEORGE B.
HOFMANN; MATTHEW BOLEY;
KIMBERLY L. HANSEN; VICTOR P.
COPELAND; LISA R. PETERSEN; and
MELYSSA DAVIDSON, individuals
Third-Party Defendants.
This matter is before the Court on Plaintiffs’ Motion to Strike and Enter Default. (Dkt.
No. 446.) Specifically, Plaintiffs ask this Court strike Defendants’ and Third-Party Defendants’
Answer and enter default against them, pursuant to Federal Rule of Civil Procedure 37, as a
sanction for Defendants’ willful, persistent, and substantial discovery abuses. (Id. at 8 & 22.)
On July 29, 2019, the Court, accompanied by Magistrate Judge Pead, heard argument on
this1 and several other motions. 2 Seven of the motions were “non-dispositive” and referred to
1
The Court provided the parties with advanced notice that it intended to discuss Plaintiffs’ Motion to Strike and
Enter Default at the July 29, 2019 hearing. (Dkt. No. 457, DTO (“The court . . . requests that the parties come to the
[July] 29, 2019 hearing prepared to address the following: 1. Pending motion[] . . . 446”).)
2
Magistrate Judge Pead pursuant to 28 U.S.C. § (b)(1)(A). At the conclusion of the July 29, 2019
hearing, Magistrate Judge Pead ruled from the bench on the motions before him. Judge Pead’s
ruling was memorialized in a written Order the following day. (Dkt. No. 463, July 30, 2019
Ruling & Order.) However, the Court agreed to defer ruling on Plaintiffs’ Motion to Strike and
Enter Default because the time for Plaintiffs to submit a reply brief had not yet expired and thus
briefing was incomplete.
Plaintiffs’ Motion to Strike and Enter Default is now ripe for decision. As stated above,
the Court heard argument on the motion on July 29, 2019. The Court concludes that an
additional hearing would not significantly aid in its determination of the motion and elects to
decide the motion on the basis of the written memoranda. DUCivR 7-1(f).
DISCUSSION
The Stipulated Amendment to the Second Amended Scheduling Order in this case
requires that fact discovery be completed by May 17, 2019. Subsequent to May 17, 2019,
however, Defendants supplemented their disclosures with approximately 275 pages on May 28,
2019, and three additional pages on May 29 and May 30. (Dkt. No. 461 at 4.) Plaintiffs claim
that this conduct violated the case management order and was an abuse of the discovery process
because Defendants (1) failed to disclose important documents in the first instance, and (2) failed
to supplement discovery responses until after the close of fact discovery. (Dkt. No. 446 at 8.)
Plaintiffs claim that these discovery abuses resulted in “substantial prejudice” to Plaintiffs and
2
On August 12, 2019, Plaintiffs filed “Objections to the Order & Ruling” (Dkt. No. 475), asserting that Magistrate
Judge Pead reached the wrong conclusion on the following five motions: Plaintiffs’ Motion to Compel (Dkt. No.
408); Defendants’ Motion for Protective Order (Dkt. No. 419); Defendants’ Motion to Compel (Dkt. No. 409);
Plaintiffs’ Motion to Stay or Extend Expert Deadlines (Dkt. No. 449); and Plaintiffs’ Motion for a Protective Order
(Dkt. No. 456). (See Dkt. No. 475, Plaintiffs’ Objections.) On September 6, 2019, the Court overruled Plaintiffs’
objections, finding no basis to conclude that the Magistrate Judge’s rulings were clearly erroneous or contrary to
law. (Dkt. No. 494.)
3
that the appropriate sanction for such conduct is to strike Defendants’ answer and enter default
against them. (Id)
The Court disagrees. As an initial matter, Federal Rule of Civil Procedure 26(e) requires
supplementation of discovery when a party “learns that in some material respect the disclosure or
response is incomplete or incorrect, and if corrective information has not otherwise been made
known to the other parties during the discovery process or in writing; or . . . as ordered by the
court.” (Id.) The Stipulated Amendment to the Second Amended Scheduling Order in this case
provides that the final date for supplementation under Rule 26(e) is “30 days before trial.” (Dkt.
No. 374, ¶ 2.m.) Defendants have explained that it was not until after they had received the
Michael Pfau documents from Plaintiffs, on May 22, 2019, that Defendants realized they were in
possession of some documents that had not already been produced. (Dkt. No. 461 at 3.)
Although the individual defendants had provided the documents to defense counsel, “they had
been inadvertently omitted from prior productions.” (Id. at 3.) Knowing that the prior
disclosures were incomplete, Defendants provided Plaintiffs with the previously omitted
documents in accord with Rule 26(e) and the Stipulated Amendment to the Second Amended
Scheduling Order.
Additionally, the Court is not convinced that the recently produced documents are as
significant, critical, or relevant as Plaintiffs maintain. For instance, it appears that many of the
documents are not new and many do not contain substantive information. (Dkt. No. 461, ¶¶ 1113.) Further, Plaintiffs’ memorandum in support identified as “significant” only two specific
emails, both involving conversations with Mr. Hoffman. (Dkt. No. 446 at 12.) However,
4
Defendants assert that one of these two significant emails actually supports Defendants’ position.
(Dkt. No. 461, ¶ 15.)
Moreover, even if, as Plaintiffs claim, the documents produced on May 28 were critical,
significant, and relevant, Defendants point out that Plaintiffs could have asked questions about
the documents at Parson Kinghorn Harris’ 30(b)(6) deposition, which the parties had agreed
would be taken on May 30, 2019.3 However, rather than proceeding with the deposition, on the
day before it was scheduled to occur, Plaintiffs cancelled it. (Dkt. No. 420-14.)
The Court also finds it significant that even though Plaintiffs unilaterally cancelled the
May 30, 2019 deposition, the Defendants nonetheless tried to mitigate any issues relating to the
documents. Specifically, at a “Meet and Confer” between the parties, held on July 9, 2019,
Defendants explicitly offered to produce Mr. Hoffman for a supplemental deposition if Plaintiffs
wanted to ask questions about the new documents. (Dkt. No. 461 at 14 & July 29, 2019 Hearing
Transcript at 30.) For reasons that are not entirely clear to the Court, Plaintiffs declined the
offer. (Id. at 32 (explaining that Plaintiffs did not “take advantage of the opportunity to make
additional inquiries” because Plaintiffs’ counsel “thought it was a false opportunity”).)
Finally, Defendants were not the only party to provide supplemental discovery after the
May 17, 2019 fact discovery deadline. Plaintiffs also provided supplemental disclosures,
3
On May 16, 2019, the parties agreed to extend the fact discovery deadline for Parson Kinghorn Harris’ 30(b)(6)
deposition beyond the May 17, 2019 fact discovery deadline. On May 20, 2019, Plaintiffs informed Defendants that
they would take the deposition on May 30, 2019, and on May 22, 2019, Plaintiffs served their Notice of 30(b)(6)
deposition for May 30, 2019. On Monday May 27, 2019 (Memorial Day), Plaintiffs’ counsel complained via email
about Defendants’ 30(b)(6) designations and requested a meet and confer. Plaintiffs’ counsel stated: “I am available
to meet and confer regarding this matter today [Memorial Day] . . . . If we do not hear from you by the end of
business tomorrow, we will be forced to file a motion to compel …, move forward with the deposition on Thursday
[May 30, 2019] regarding the matters you have designated an individual to testify, and schedule the remaining
matters for another date.” (Dkt. No. 461-5.)
5
including Plaintiffs’ Fourth Supplemental Initial Disclosures, served on July 3, 2019, which
included a report dating back to January 16, 2014. (Dkt. No. 461 at 7.) 4
Thus, even assuming arguendo that Defendants’ disclosures were untimely, there is
nothing in the record to suggest that Defendants acted willfully or in bad faith. Moreover,
Plaintiffs’ claims of prejudice resulting from the late disclosures are belied by the fact that
Plaintiffs rejected Defendants’ offer, in July of 2019, to make Mr. Hoffman available in a
supplemental deposition to answer any questions raised by the new documents.
CONCLUSION
For the foregoing reasons, Plaintiffs’ Motion to Strike Answer and Enter Default is
DENIED in its entirety.
IT IS SO ORDERED.
DATED this 9th day of September, 2019.
BY THE COURT:
Dee Benson
United States District Judge
4
Both parties appear to have provided additional supplemental disclosures, after the close of fact discovery, during
May, June, and July 2019. (See Dkt. 446 at 16-18; Dkt. No. 461 at 7 ¶ 9.)
6
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