Otos v. WHPacific Inc

Filing 28

ORDER denying plaintiff's 20 Motion to Compel signed by Judge Richard A Jones.(RS)

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1 THE HONORABLE RICHARD A. JONES 2 3 4 5 6 7 8 THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON AT SEATTLE 9 10 11 SUSAN OTOS, 12 NO. 2:16-cv-01623-RAJ Plaintiff, 13 14 15 ORDER vs. WHPACIFIC, INC., an Alaska Corporation, Defendant. 16 17 18 This matter comes before the Court on Plaintiff Susan Otos’s Motion to 19 Compel Answers and Responses to Plaintiff’s Discovery Requests. Dkt. # 20. 20 Defendant WHPacific, Inc. (“WHP”) opposes the Motion. Dkt. # 23. 21 I. BACKGROUND 22 Plaintiff filed suit against WHP for age discrimination, gender 23 discrimination, and wrongful discharge. Dkt. # 1-1 (Complaint). The parties met 24 and conferred several times to discuss discovery disagreements but have come to a 25 standstill. Plaintiff requested that WHP produce discovery from two non-party 26 affiliates: NANA Development Corporation (“NANA”) and Grand Isle Shipyard 27 (“GIS”). WHP denies that it has access to either NANA’s or GIS’s documents. 28 ORDER - 1 1 Plaintiff further requested, generally, that WHP fully comply with her discovery 2 requests and submit more timely productions. WHP claims that it has consistently 3 produced documents on a rolling basis as they become available. Unable to resolve 4 the issues, Plaintiff now moves this Court to compel WHP to comply with her 5 discovery requests. 6 II. LEGAL STANDARD 7 The Court has broad discretion to control discovery. Avila v. Willits Envtl. 8 Remediation Trust, 633 F.3d 828, 833 (9th Cir. 2011). That discretion is guided by 9 several principles. Most importantly, the scope of discovery is broad. A party must 10 respond to any discovery request that is not privileged and that is “reasonably 11 calculated to lead to the discovery of admissible evidence.” Fed. R. Civ. P. 12 26(b)(1). The Court, however, must limit discovery where it can be obtained from 13 some other source that is more convenient, less burdensome, or less expensive, or 14 where its “burden or expense . . . outweighs its likely benefit, considering the needs 15 of the case, the amount in controversy, the parties’ resources, the importance of the 16 issues at stake in the action, and the importance of the discovery in resolving these 17 issues.” Fed. R. Civ. P. 26(b)(2)(C)(i), (iii). 18 Pursuant to Rule 37(a)(5)(A), if a motion to compel is granted, or if 19 requested discovery is provided after the motion is filed, “the court must, after 20 giving an opportunity to be heard, require the party . . . whose conduct necessitated 21 the motion, the party or attorney advising that conduct, or both to pay the movant’s 22 reasonable expenses incurred in making the motion, including attorney’s fees.” But 23 the Court is precluded from awarding expenses if: “(i) the movant filed the motion 24 before attempting in good faith to obtain the disclosure or discovery without court 25 action; (ii) the opposing party’s nondisclosure, response, or objection was 26 substantially justified; or (iii) other circumstances make an award of expenses 27 unjust.” Fed. R. Civ. P. 37(a)(5)(A). 28 ORDER - 2 1 III. DISCUSSION 2 A. “Control” Under Rule 34 3 Federal Rule of Civil Procedure 34(a) allows courts to order production of 4 documents or items as long as those documents or items are in the possession, 5 custody, or control of a party to the litigation. Production of documents or items 6 possessed by related non-parties is warranted as long as the party to the litigation 7 has custody or control of those documents or items. In re Citric Acid Litig., 191 8 F.3d 1090, 1107 (9th Cir. 1999); United States v. Int’l Union of Petroleum & Indus. 9 Workers, 870 F.2d 1450, 1452 (9th Cir. 1989). “Control” is defined as “the legal 10 right to obtain documents on demand.” Int’l Union, 870 F.2d at 1452. The Ninth 11 Circuit has refused to expand the definition of “control” to include a party’s 12 practical ability to obtain the documents or items requested. In re Citric, 191 F.3d 13 at 1107-1108. The party seeking production bears the burden of demonstrating 14 actual control; proof of theoretical control is not enough to meet this burden. Int’l 15 Union, 870 F.2d at 1454. 16 Notwithstanding the definition of “control” set forth in International Union 17 and In re Citric, the Court notes that courts within the Ninth Circuit (including 18 courts within the same district) have taken inconsistent positions when addressing 19 whether a subsidiary possesses sufficient “control” of documents or items allegedly 20 in their parent corporation’s possession. See, e.g., AFL Telecomms. LLC v. 21 SurplusEQ.com Inc., No. CV11-1086 PHX DGC, 2012 WL 2590557, at *2 (D. 22 Ariz. July 5, 2012) (relying on a Third Circuit case cited by the Ninth Circuit in In 23 re Citric to adopt a more expansive definition of “control”); see also Thales 24 Avionics Inc. v. Matsushita Avionics Sys. Corp., No. SACV 04-454-JVS(MLGx), 25 2006 WL 6534230, at *4-5 (C.D. Cal. Mar. 8, 2006) (relying on case law outside 26 the Ninth Circuit to consider the “nature of the relationship” between a subsidiary 27 and its parent corporation to determine “control”); Choice-Intersil Microsystems, 28 ORDER - 3 1 Inc. v. Agere Sys., Inc., 224 F.R.D. 471, 472-73 (N.D. Cal. 2004) (same). However, 2 as duly noted by district courts within the Ninth Circuit, the Ninth Circuit has not 3 expanded the definition of “control” to include a practical ability to obtain 4 documents. E.g., Seifi v. Mercedez-Benz U.S.A., LLC, No. 12-cv-05493-TEH(JSC), 5 2014 WL 7187111, at *2-3 (N.D. Cal. Dec. 16, 2014) (binding Ninth Circuit law 6 does not rely on an expansive definition of “control”); Dugan v. Lloyds TSB Bank 7 PLC, No. 12-cv-02549-WHA (NJV), 2013 WL 4758055, at *3 (N.D. Cal. Sept. 4, 8 2013) (acknowledging that while “control” between a subsidiary and its parent may 9 be established under a more expansive definition, the same is not true under Ninth 10 Circuit law); Ehrlich v. BMW, No. CV 10-1151-ABC (PJWx), 2011 WL 3489105, 11 at *1 (C.D. Cal. May 2, 2011) (“Plaintiff argues, it seems, that, based on the 12 inherent relationship between the two companies, [the subsidiary] must have access 13 to these documents. This theory has been rejected by the Ninth Circuit and is 14 rejected here.”); Gen. Metals of Tacoma, Inc. v. Bean Envtl. LLC, No. C05-5306 15 RBL, 2006 WL 2927730, at *2 (W.D. Wash. Oct. 11, 2006) (refusing to expand the 16 test for determining “control”); but see Stella Sys., LLC v. MedeAnalytics, Inc., No. 17 14-cv-00880-LB, 2015 WL 1870052, at *3 (N.D. Cal. Apr. 22, 2015) (applying 18 expansive definition of control when considering whether a party has control of 19 documents possessed by an unrelated company). 20 The Court agrees that the proper test for determining control between a 21 subsidiary and its parent is whether the subsidiary has the legal right to demand 22 production of the documents or things sought from its parent. Moreover, the Court 23 finds that Plaintiff failed to meet her burden to show that WHP has the proper 24 control over either NANA’s or GIS’s documents. Plaintiff argues a close 25 relationship between these companies: she alleges that WHP is a wholly owned 26 subsidiary, that the companies have overlapping executives and personnel, and that 27 these overlapping personnel made decisions with regard to her employment with 28 ORDER - 4 1 WHP. Dkt. ## 20, 26. This is not sufficient to show that WHP has control over 2 GIS or NANA’s documents. As the Court explained through the cited law above, 3 convenient access to documents does not translate to the legal control necessary for 4 this Court to grant the Motion. Though NANA or GIS may have been able to 5 exercise such control over WHP’s documents, the reverse does not hold true based 6 upon Plaintiff’s representations. 7 Plaintiff further alleges that NANA and GIS have acted as agents for WHP. 8 To support this argument, Plaintiff cites the Administrative Services Agreement 9 entered into by WHP and GIS. Dkt. # 26 at 5. However, this Agreement explicitly 10 denies any kind of agency relationship. Dkt. # 21 at 87 (“The parties hereto are 11 independent contractors and this Agreement shall in no way create a partnership, 12 joint venture, agency or other relationship between them.”). 13 B. Inadequate Or Delayed Responses 14 In addition to seeking discovery from non-party affiliates, Plaintiff seeks 15 additional documents from WHP. Specifically, Plaintiff claims that WHP’s 16 productions “have been consistently inadequate.” Dkt. # 20 at 2. But Plaintiff does 17 not describe any particular inadequacy beyond her wish for the non-party affiliates’ 18 documents. To be sure, she summarily claims that WHP made baseless objections 19 and has produced the documents at an unacceptably slow rate. Plaintiff asks the 20 Court to compel WHP to “fully respond” to her first set of interrogatories and 21 requests for production. Dkt. # 26 at 2. 22 The Court cannot compel WHP to “fully respond” when there is no 23 discussion or explanation of how WHP has failed to meet its discovery 24 responsibilities. See Christ v. Blackwell, No. CIV S-10-0760 EFB P, 2011 WL 25 3847165, at *2 (E.D. Cal. Aug. 30, 2011) (finding that the plaintiff bears the burden 26 to inform the Court which discovery requests are the subject of the Motion, which 27 requests are disputed, and why a defendant’s responses are deficient). Granting 28 ORDER - 5 1 such a nebulous motion would be toothless because the Court could not reasonably 2 enforce an order that merely directs WHP to “complete [its] production.” Dkt. # 26 3 at 3. This is especially true in light of Plaintiff’s admission that her issue is one of 4 trust rather than a concrete concern about deficient responses: “she simply cannot 5 take Defendant’s word that its production is complete.” Id. at 2. 6 C. Expenses Under Rule 37 7 Based on Defendant’s own timeline, it appears that a large portion of the 8 discovery was produced after Plaintiff filed her motion to compel. Rule 37(a)(5) 9 requires the Court to award expenses when “disclosure or requested discovery is 10 provided after the [Motion to Compel] was filed.” Fed. R. Civ. P. 37(a)(5). “But 11 the court must not order this payment if . . . other circumstances make an award of 12 expenses unjust.” Id. 13 The Court finds that awarding expenses under these circumstances is unjust. 14 It appears that the parties met and conferred on several occasions and were able to 15 agree upon extensions of production deadlines. Though WHP sped up its 16 productions after the Motion, it appears that WHP had been consistently producing 17 documents prior to the Motion. Of course, should such a pattern continue—that is, 18 productions become increasingly available only after Plaintiff is forced to file 19 additional motions—the Court may find a future award of expenses justified. 20 IV. CONCLUSION 21 For all the foregoing reasons, the Court DENIES Plaintiff’s Motion to 22 Compel. Dkt. # 20. 23 Dated this 6th day of June, 2017. 24 A 25 26 The Honorable Richard A. Jones United States District Judge 27 28 ORDER - 6

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