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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THE HONORABLE RICHARD A. JONES

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THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

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SUSAN OTOS,

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NO. 2:16-cv-01623-RAJ
Plaintiff,

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ORDER

vs.
WHPACIFIC, INC., an Alaska Corporation,
Defendant.

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This matter comes before the Court on Plaintiff Susan Otos’s Motion to

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Compel Answers and Responses to Plaintiff’s Discovery Requests. Dkt. # 20.

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Defendant WHPacific, Inc. (“WHP”) opposes the Motion. Dkt. # 23.

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I.

BACKGROUND

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Plaintiff filed suit against WHP for age discrimination, gender

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discrimination, and wrongful discharge. Dkt. # 1-1 (Complaint). The parties met

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and conferred several times to discuss discovery disagreements but have come to a

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standstill. Plaintiff requested that WHP produce discovery from two non-party

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affiliates: NANA Development Corporation (“NANA”) and Grand Isle Shipyard

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(“GIS”). WHP denies that it has access to either NANA’s or GIS’s documents.

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ORDER - 1

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Plaintiff further requested, generally, that WHP fully comply with her discovery
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requests and submit more timely productions. WHP claims that it has consistently
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produced documents on a rolling basis as they become available. Unable to resolve
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the issues, Plaintiff now moves this Court to compel WHP to comply with her
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discovery requests.
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II.

LEGAL STANDARD

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The Court has broad discretion to control discovery. Avila v. Willits Envtl.
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Remediation Trust, 633 F.3d 828, 833 (9th Cir. 2011). That discretion is guided by
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several principles. Most importantly, the scope of discovery is broad. A party must
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respond to any discovery request that is not privileged and that is “reasonably
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calculated to lead to the discovery of admissible evidence.” Fed. R. Civ. P.
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26(b)(1). The Court, however, must limit discovery where it can be obtained from
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some other source that is more convenient, less burdensome, or less expensive, or
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where its “burden or expense . . . outweighs its likely benefit, considering the needs
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of the case, the amount in controversy, the parties’ resources, the importance of the
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issues at stake in the action, and the importance of the discovery in resolving these
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issues.” Fed. R. Civ. P. 26(b)(2)(C)(i), (iii).
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Pursuant to Rule 37(a)(5)(A), if a motion to compel is granted, or if
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requested discovery is provided after the motion is filed, “the court must, after
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giving an opportunity to be heard, require the party . . . whose conduct necessitated
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the motion, the party or attorney advising that conduct, or both to pay the movant’s
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reasonable expenses incurred in making the motion, including attorney’s fees.” But
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the Court is precluded from awarding expenses if: “(i) the movant filed the motion
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before attempting in good faith to obtain the disclosure or discovery without court
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action; (ii) the opposing party’s nondisclosure, response, or objection was
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substantially justified; or (iii) other circumstances make an award of expenses
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unjust.” Fed. R. Civ. P. 37(a)(5)(A).
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ORDER - 2

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III.

DISCUSSION

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A. “Control” Under Rule 34
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Federal Rule of Civil Procedure 34(a) allows courts to order production of
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documents or items as long as those documents or items are in the possession,
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custody, or control of a party to the litigation. Production of documents or items
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possessed by related non-parties is warranted as long as the party to the litigation
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has custody or control of those documents or items. In re Citric Acid Litig., 191
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F.3d 1090, 1107 (9th Cir. 1999); United States v. Int’l Union of Petroleum & Indus.
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Workers, 870 F.2d 1450, 1452 (9th Cir. 1989). “Control” is defined as “the legal
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right to obtain documents on demand.” Int’l Union, 870 F.2d at 1452. The Ninth
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Circuit has refused to expand the definition of “control” to include a party’s
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practical ability to obtain the documents or items requested. In re Citric, 191 F.3d
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at 1107-1108. The party seeking production bears the burden of demonstrating
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actual control; proof of theoretical control is not enough to meet this burden. Int’l
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Union, 870 F.2d at 1454.
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Notwithstanding the definition of “control” set forth in International Union
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and In re Citric, the Court notes that courts within the Ninth Circuit (including
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courts within the same district) have taken inconsistent positions when addressing
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whether a subsidiary possesses sufficient “control” of documents or items allegedly
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in their parent corporation’s possession. See, e.g., AFL Telecomms. LLC v.
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SurplusEQ.com Inc., No. CV11-1086 PHX DGC, 2012 WL 2590557, at *2 (D.
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Ariz. July 5, 2012) (relying on a Third Circuit case cited by the Ninth Circuit in In
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re Citric to adopt a more expansive definition of “control”); see also Thales
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Avionics Inc. v. Matsushita Avionics Sys. Corp., No. SACV 04-454-JVS(MLGx),
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2006 WL 6534230, at *4-5 (C.D. Cal. Mar. 8, 2006) (relying on case law outside
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the Ninth Circuit to consider the “nature of the relationship” between a subsidiary
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and its parent corporation to determine “control”); Choice-Intersil Microsystems,
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ORDER - 3

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Inc. v. Agere Sys., Inc., 224 F.R.D. 471, 472-73 (N.D. Cal. 2004) (same). However,
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as duly noted by district courts within the Ninth Circuit, the Ninth Circuit has not
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expanded the definition of “control” to include a practical ability to obtain
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documents. E.g., Seifi v. Mercedez-Benz U.S.A., LLC, No. 12-cv-05493-TEH(JSC),
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2014 WL 7187111, at *2-3 (N.D. Cal. Dec. 16, 2014) (binding Ninth Circuit law
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does not rely on an expansive definition of “control”); Dugan v. Lloyds TSB Bank
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PLC, No. 12-cv-02549-WHA (NJV), 2013 WL 4758055, at *3 (N.D. Cal. Sept. 4,
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2013) (acknowledging that while “control” between a subsidiary and its parent may
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be established under a more expansive definition, the same is not true under Ninth
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Circuit law); Ehrlich v. BMW, No. CV 10-1151-ABC (PJWx), 2011 WL 3489105,
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at *1 (C.D. Cal. May 2, 2011) (“Plaintiff argues, it seems, that, based on the
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inherent relationship between the two companies, [the subsidiary] must have access
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to these documents. This theory has been rejected by the Ninth Circuit and is
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rejected here.”); Gen. Metals of Tacoma, Inc. v. Bean Envtl. LLC, No. C05-5306
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RBL, 2006 WL 2927730, at *2 (W.D. Wash. Oct. 11, 2006) (refusing to expand the
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test for determining “control”); but see Stella Sys., LLC v. MedeAnalytics, Inc., No.
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14-cv-00880-LB, 2015 WL 1870052, at *3 (N.D. Cal. Apr. 22, 2015) (applying
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expansive definition of control when considering whether a party has control of
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documents possessed by an unrelated company).
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The Court agrees that the proper test for determining control between a
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subsidiary and its parent is whether the subsidiary has the legal right to demand
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production of the documents or things sought from its parent. Moreover, the Court
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finds that Plaintiff failed to meet her burden to show that WHP has the proper
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control over either NANA’s or GIS’s documents. Plaintiff argues a close
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relationship between these companies: she alleges that WHP is a wholly owned
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subsidiary, that the companies have overlapping executives and personnel, and that
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these overlapping personnel made decisions with regard to her employment with
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ORDER - 4

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WHP. Dkt. ## 20, 26. This is not sufficient to show that WHP has control over
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GIS or NANA’s documents. As the Court explained through the cited law above,
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convenient access to documents does not translate to the legal control necessary for
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this Court to grant the Motion. Though NANA or GIS may have been able to
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exercise such control over WHP’s documents, the reverse does not hold true based
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upon Plaintiff’s representations.
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Plaintiff further alleges that NANA and GIS have acted as agents for WHP.
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To support this argument, Plaintiff cites the Administrative Services Agreement
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entered into by WHP and GIS. Dkt. # 26 at 5. However, this Agreement explicitly
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denies any kind of agency relationship. Dkt. # 21 at 87 (“The parties hereto are
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independent contractors and this Agreement shall in no way create a partnership,
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joint venture, agency or other relationship between them.”).
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B. Inadequate Or Delayed Responses
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In addition to seeking discovery from non-party affiliates, Plaintiff seeks
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additional documents from WHP. Specifically, Plaintiff claims that WHP’s
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productions “have been consistently inadequate.” Dkt. # 20 at 2. But Plaintiff does
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not describe any particular inadequacy beyond her wish for the non-party affiliates’
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documents. To be sure, she summarily claims that WHP made baseless objections
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and has produced the documents at an unacceptably slow rate. Plaintiff asks the
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Court to compel WHP to “fully respond” to her first set of interrogatories and
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requests for production. Dkt. # 26 at 2.
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The Court cannot compel WHP to “fully respond” when there is no
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discussion or explanation of how WHP has failed to meet its discovery
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responsibilities. See Christ v. Blackwell, No. CIV S-10-0760 EFB P, 2011 WL
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3847165, at *2 (E.D. Cal. Aug. 30, 2011) (finding that the plaintiff bears the burden
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to inform the Court which discovery requests are the subject of the Motion, which
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requests are disputed, and why a defendant’s responses are deficient). Granting
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such a nebulous motion would be toothless because the Court could not reasonably
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enforce an order that merely directs WHP to “complete [its] production.” Dkt. # 26
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at 3. This is especially true in light of Plaintiff’s admission that her issue is one of
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trust rather than a concrete concern about deficient responses: “she simply cannot
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take Defendant’s word that its production is complete.” Id. at 2.
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C. Expenses Under Rule 37
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Based on Defendant’s own timeline, it appears that a large portion of the
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discovery was produced after Plaintiff filed her motion to compel. Rule 37(a)(5)
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requires the Court to award expenses when “disclosure or requested discovery is
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provided after the [Motion to Compel] was filed.” Fed. R. Civ. P. 37(a)(5). “But
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the court must not order this payment if . . . other circumstances make an award of
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expenses unjust.” Id.
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The Court finds that awarding expenses under these circumstances is unjust.
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It appears that the parties met and conferred on several occasions and were able to
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agree upon extensions of production deadlines. Though WHP sped up its
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productions after the Motion, it appears that WHP had been consistently producing
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documents prior to the Motion. Of course, should such a pattern continue—that is,
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productions become increasingly available only after Plaintiff is forced to file
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additional motions—the Court may find a future award of expenses justified.
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IV.

CONCLUSION

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For all the foregoing reasons, the Court DENIES Plaintiff’s Motion to
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Compel. Dkt. # 20.
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Dated this 6th day of June, 2017.
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A

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The Honorable Richard A. Jones
United States District Judge

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ORDER - 6