Clark County Bancorporation v. Federal Deposit Insurance Corporation et al

Filing 138

ORDER signed by Judge Benjamin H. Settle granting 129 Motion to Compel; requesting supplemental response from Plaintiff and renoting 132 MOTION for Contempt : Noting Date 2/9/2018.(TG)

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT TACOMA

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CLARK COUNTY
BANCORPORATION,

CASE NO. C14-5816 BHS
Plaintiff,

v.
FEDERAL DEPOSIT INSURANCE
CORPORATION, AS RECEIVER FOR
BANK OF CLARK COUNTY,

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ORDER GRANTING
DEFENDANT’S MOTION TO
COMPEL, REQUESTING
SUPPLEMENTAL RESPONSE
FROM PLAINTIFF, AND
RENOTING PLAINTIFF’S
MOTION

Defendant.

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This matter comes before the Court on Defendant Federal Deposit Insurance

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Corporation-Receiver’s (“FDIC-R”) motion to compel (Dkt. 129) and Plaintiff Clark

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County Bancorporation’s (“CCB”) motion for contempt (Dkt. 132). The Court has

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considered the pleadings filed in support of and in opposition to the motions and the

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remainder of the file and hereby rules as follows:
I.

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PROCEDURAL AND FACTUAL HISTORY

On February 10, 2016, CCB filed an amended complaint asserting one cause of

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action arising from the FDIC-R’s disallowance of CCB’s claim for tax refunds. Dkt. 88.

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CCB owned all of the stock in Bank of Clark County (“Bank”), which the FDIC-R took

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over as a failed institution. CCB and the Bank entered into a Tax Allocation Agreement.

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CCB alleges that the agreement “requires calculation of federal income taxes on a

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separate entity basis. A subsidiary may receive only an amount which is equal to the

ORDER - 1

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amount of the tax refund that the subsidiary would have received from the I.R.S. if its

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taxes had been calculated on a stand-alone basis.” Id. ¶ 21. CCB attached to the

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complaint a chart showing the Bank’s percentage taxable income and refund amount. Id.,

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Exh. E (“Chart”).

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During discovery FDIC-R served requests for admissions and interrogatories on

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CCB. Interrogatory 1 requested an explanation of the computations and calculation of

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the Chart. Dkt. 129 at 28. Interrogatory 3 requested an explanation of a statement CCB

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included in its motion for summary judgment. Id. Interrogatory 4 requested an

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explanation for and information pertaining to any denial of a request for admission. Id. at

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29. CCB objected to this discovery. On November 16, 2017, FDIC-R filed a motion to

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compel. Dkt. 129. On December 18, 2017, CCB responded. Dkt. 134. On December

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29, 2017, FDIC-R replied. Dkt. 135.

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Also during discovery, CCB served subpoenas on the United States Department of

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the Treasury (“DOT”) requesting the production of certain documents. CCB asserts that

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DOT has not responded to the subpoena. On December 1, 2017, CCB filed a motion for

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contempt requesting that the Court hold DOT in contempt for failing to respond. Dkt.

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132.

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II. DISCUSSION
A.

Compel
“On notice to other parties and all affected persons, a party may move for an order

compelling disclosure or discovery.” Fed. R. Civ. P. 37(a)(1). “Parties may obtain

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discovery regarding any nonprivileged matter that is relevant to any party’s claim or

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defense and proportional to the needs of the case . . . .” Fed. R. Civ. P. 26(b)(1).

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In this case, FDIC-R moves to compel CCB to respond to interrogatories 1, 3, and

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4. With regard to numbers 3 and 4, FDIC-R has shown that the information is relevant to

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issues in this case. Explanations regarding computations and calculations for numbers in

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a chart attached to the complaint is relevant. Moreover, information regarding a position

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an opposing party took in an earlier summary judgment motion is also relevant.

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Therefore, the Court grants FDIC-R’s motion on these requests.

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Regarding interrogatory number 4, FDIC-R has shown that responses are required.

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While CCB is correct that Rule 36 does not control interrogatories, multiple courts have

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held that, under Rule 33, requesting explanations for denials are appropriate as long as

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the party does not exceed the allowed number of interrogatories. See, e.g., Jovanovich v.

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Redden Marine Supply, Inc., C10-924-RSM, 2011 WL 4459171, at *2–3 (W.D. Wash.

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Sept. 26, 2011). FDIC-R requests information regarding eight denials, which does not

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exceed its allotted 25 interrogatories. Therefore, the Court grants FDIC-R’s motion on

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this issue.

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Finally, regarding fees, the Court reserves ruling on the fee request. If CCB

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timely responds subsequent to this order, then the Court is inclined to deny fees.

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However, if CCB asserts new objections or otherwise obstructs production, FDIC-C may

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move for these fees plus others incurred in attempting to resolve such obstructions.

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B.

Contempt
The Court finds at least two potential problems with CCB’s motion. First, due

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process requires notice and an opportunity to be heard. While CCB certifies that the

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motion was served on the parties, the Court is unable to locate any certification that the

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motion was served on DOT. Without such certification, the Court will not hold a party in

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contempt without notice.

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Second, CCB’s subpoena requires compliance more than 100 miles from where

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DOT apparently conducts business. CCB served the subpoenas on DOT in Washington

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D.C. and required compliance in Vancouver, WA. Such requests may violate Fed. R.

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Civ. P. 45(c).

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Therefore, the Court requests a supplemental response from CCB before

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considering the merits of its motion. A response is due by February 9, 2018. Failure to

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respond will result in denial of the motion. The Clerk shall renote the motion for

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consideration on the Court’s February 9, 2018 calendar.
III. ORDER

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Therefore, it is hereby ORDERED that FDIC-R’s motion to compel (Dkt. 129) is

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GRANTED and the Clerk shall renote CCB’s motion for contempt (Dkt. 132). CCB

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may file a supplemental response no later than February 9, 2017.

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Dated this 31st day of January, 2018.

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A

BENJAMIN H. SETTLE
United States District Judge

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