The Huntington National Bank v. Hard Rock Exploration, Inc. et al

Filing 140

MEMORANDUM OPINION AND ORDER CONFIRMING PRONOUNCED ORDER OF THE COURT DENYING DEFENDANTS' MOTIONS TO EXTEND DISCOVERY AND TIME TO RESPOND TO PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT: It is ORDERED that Defendants' 130 Motion for Ext ension of Time to File Response, 131 Motion for Extension of Time to File Response, 131 Motion for Extension of Time to Complete Discovery, and 132 Motion for Joinder are hereby DENIED. The Court DIRECTED the Defendants to file their responses to Plaintiff's 121 MOTION for Summary Judgment on or before 2/2/2018 and Plaintiff is DIRECTED to file any reply on or before 2/12/2018. Signed by Senior Judge Frederick P. Stamp, Jr on 1/29/18. (cnd)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
THE HUNTINGTON NATIONAL BANK,
Plaintiff,
v.

Civil Action No. 1:16CV48
(STAMP)

HARD ROCK EXPLORATION, INC.,
CARALINE ENERGY COMPANY,
BLUE JACKET GATHERING, LLC,
BLUE JACKET PARTNERSHIP,
BROTHERS REALTY, LLC,
DUANE YOST,
JAMES L. STEPHENS, JR.,
GREGORY LAUGHLIN and
MONICA R. FRANCISCO,
Defendants.
MEMORANDUM OPINION AND ORDER
CONFIRMING PRONOUNCED ORDER OF THE COURT
DENYING DEFENDANTS’ MOTIONS TO EXTEND DISCOVERY AND
TIME TO RESPOND TO PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT
I.

Background

On January 23, 2018, the parties, by counsel, appeared in this
Court for a hearing on certain defendants’ motions to extend
discovery and the time to respond to the plaintiff’s motion for
summary judgment.

The motions to extend discovery and the time to

respond to the plaintiff’s motion for summary judgment were filed
by

defendant

defendants

Gregory

James

Laughlin

Stephens,

Jr.

(“Laughlin”)
(“Stephens,

(ECF
Jr.”)

No.
and

130),
Monica

Francisco (“Francisco”) (ECF No. 131), and defendant Duane Yost
(“Yost”) (ECF No. 132).

Specifically, the motions represent that

the movants require additional time to take the deposition of Mr.

Robert Redfield of Huntington Insurance, Inc.

Defendant Laughlin,

joined by defendants Stephens, Jr., Francisco, and Yost, then filed
a motion for an expedited emergency hearing on the motions to
extend discovery and the time to respond to the plaintiff’s motion
for summary judgment.

The motion for an expedited emergency

hearing represented that the hearing was required “to prevent
irrevocable

prejudice

and

harm

from

the

Court’s

premature

consideration of Plaintiff’s dispositive motion when discovery is
not complete and the Trustee and his counsel have not appeared or
yet been able to protect the interests of the Debtor entities.”
ECF No. 133.
The Court granted the motion for an expedited emergency
hearing on the defendants’ motions and directed that counsel meet
and confer prior to the hearing.

The Court also suspended the

January 19, 2018 deadline for the defendants to file responses to
the

summary

judgment

motion

until

the

Court

ruled

on

the

defendants’ motions. At the hearing, counsel reported to the Court
that they did meet and confer prior to the hearing concerning the
possible resolution of the defendants’ motions.
heard oral argument on the defendants’ motions.

This Court then
For the following

reasons, this Court denied the defendants’ motions to extend
discovery and the time to respond to the plaintiff’s motion for
summary judgment.

2

II.

Applicable Law

Federal Rule of Civil Procedure 56 provides:
(d) When Facts Are Unavailable to the Nonmovant. If a
nonmovant shows by affidavit or declaration that, for
specified reasons, it cannot present facts essential to
justify its opposition, the court may:
(1)

defer considering the motion or deny it;

(2) allow time to obtain affidavits
declarations or to take discovery; or
(3)

or

issue any other appropriate order.

Fed. R. Civ. P. 56(d).1
“If a party believes that more discovery is necessary for it
to demonstrate a genuine issue of material fact, the proper course
is to file a Rule 56(f) affidavit stating ‘that it could not
properly oppose a motion for summary judgment without a chance to
conduct discovery.’”
302

F.3d

214,

244

Harrods Ltd. v. Sixty Internet Domain Names,
(4th

Cir.

2002)

(quoting

Evans

v.

Techs.

Applications & Serv. Co., 80 F.3d 954, 961 (4th Cir. 1996)).

“We

have warned litigants that we ‘place great weight on the Rule 56(f)
affidavit’ and that ‘[a] reference to Rule 56(f) and the need for
additional discovery in a memorandum of law in opposition to a
motion for summary judgment is not an adequate substitute for a
Rule 56(f) affidavit.’”

Id.

1

“The language of Rule 56(d) appeared in Rule 56(f) before
amendments in 2010, but these amendments made no substantial change
to the rule.” McCray v. Md. Dep’t of Transp., Md. Transit Admin.,
741 F.3d 480, 484 n.2 (4th Cir. 2014).
3

“Indeed, ‘the failure to file an affidavit under Rule 56(f) is
itself sufficient grounds to reject a claim that the opportunity
for discovery was inadequate.’” Id. “The purpose of the affidavit
is to ensure that the nonmoving party is invoking the protections
of Rule 56(f) in good faith and to afford the trial court the
showing necessary to assess the merit of a party’s opposition.”
Id. (citing First Chicago Int’l v. United Exch. Co., 836 F.2d 1375,
1380 (D.C. Cir. 1988)).
III.
At

the

hearing

on

the

Discussion
defendants’

motions,

this

Court

indicated to counsel that the motions must be addressed under Rule
56(d).
motions

However, the movants did not address Rule 56(d) in their
to

extend

discovery

and

the

time

plaintiff’s motion for summary judgment.

to

respond

to

the

Additionally, no party

has filed an affidavit or declaration stating that it cannot
properly oppose the motion for summary judgment without a chance to
conduct further discovery, as is required by Rule 56(d).
In Harrods, the United States Court of Appeals for the Fourth
Circuit held that the district court’s order granting summary
judgment was premature because the plaintiff, Harrods UK, did not
have an adequate opportunity for discovery.

The Fourth Circuit

found that, under the circumstances presented in that case, “it
would be unfair to penalize Harrods UK for failing to file the
formal affidavit called for by the rule.”

4

302 F.3d at 246.

Those

circumstances were that “almost no discovery” had been conducted
and that “summary judgment isn’t usually granted or even considered
this early in the proceedings.”

Id. at 245.

Specifically, the

district

judgment

October

court

granted

summary

on

6,

2000,

discovery was not due to be completed until December 29, 2000, the
defendants did not even respond to the plaintiff’s first set of
interrogatories until November 2, 2000, and there was no evidence
of depositions before December 2000.

Id.

“Thus, summary judgment

was granted to the [defendants] when little or no discovery had
been completed, and there is nothing to suggest that this was due
to inactivity or delay on the part of Harrods UK.”

Id.

The Fourth Circuit also found that, even though Harrods UK
failed to file a formal affidavit, it nonetheless “adequately
fulfilled the purpose of Rule 56(f) by putting the district court
on notice of the reasons why summary judgment was premature.”

Id.

Specifically, “Harrods UK made it clear to the district court in
the summary judgment proceedings that its case hinged on its
ability to establish Harrods BA’s bad faith, which is a factspecific issue.”

Id. at 246.

Furthermore, “Harrods UK repeatedly

explained to the district court both in writing and orally that
more discovery was needed and that it was too early to decide the
motion for summary judgment.”

Id.

In a footnote, the Fourth Circuit emphasized the unique
circumstances of the Harrods case as follows:

5

Although the particular circumstances of this case mean
that Harrods UK will not be penalized for failing to
state its case for more discovery in an affidavit, we
hasten to add that parties who ignore Rule 56(f)’s
affidavit requirement do so at their peril. We reiterate
that our court expects full compliance with Rule 56(f)
and that the “failure to file an affidavit under Rule
56(f) is itself sufficient grounds to reject a claim that
the opportunity for discovery was inadequate.” Evans, 80
F.3d at 961 (quotations omitted).
Id. at 246 n.19.
This Court finds that the narrow circumstances that warranted
the lack of an affidavit or declaration in Harrods are not present
in the instant case.

In this case, discovery ended on December 1,

2017, and the plaintiff timely filed its motion for summary
judgment on December 29, 2017.

However, the movants did not

represent to this Court that they required additional time to
obtain the deposition of Mr. Redfield until January 17, 2018.

At

the hearing, the movants acknowledged that on August 25, 2017,
counsel for defendant Laughlin filed a notice of deposition duces
tecum of Mr. Redfield.

Also at the hearing, counsel for the

plaintiff stated that, soon after the notice was filed, she advised
the

movants

that

Mr.

Redfield

does

not

work

for

plaintiff

Huntington Bank, but rather for Huntington Insurance, which is a
separate entity and not a party to this litigation.

Yet, the

movants did not dispute at the hearing that they failed to pursue
the deposition after counsel for defendant Laughlin filed the
notice.

Additionally, counsel for defendants Stephens, Jr. and

Francisco stated that he already has some past testimony from Mr.
6

Redfield.

Furthermore, it became clear during oral argument that

the movants wanted to extend discovery for the purpose of taking
other depositions in addition to that of Mr. Redfield.
“[T]o gain the benefit of Rule 56(d), the party opposing
summary judgment must make a sufficient proffer: ‘the proffer
should be authoritative, it should be advanced in a timely manner,
and it should explain why the party is unable currently to adduce
the facts essential to opposing summary judgment.’”

In re PHC,

Inc. S’holder Litig., 762 F.3d 138, 143 (1st Cir. 2014) (quoting
Resolution Trust Corp. v. N. Bridge Assocs., Inc., 22 F.3d 1198,
1203

(1st

Cir.

1994)).

The

third

requirement,

the

party’s

explanation, “should (i) ‘show good cause for the failure to have
discovered the facts sooner’; (ii) ‘set forth a plausible basis for
believing that specific facts . . . probably exist’; and (iii)
‘indicate how the emergent facts . . . will influence the outcome
of the pending summary judgment motion.’”

Id.

“Thus, in a case

involving incomplete discovery, the Rule 56(d) proffer requirements
can be categorized as: ‘authoritativeness, timeliness, good cause,
utility, and materiality.’”

Id.

Here, the motions for an extension of discovery were not
authoritative

because

they

did

not

include

an

affidavit

or

declaration.

The motions were not timely because the movants’

responses to the plaintiff’s motion for summary judgment were due
on January 19, 2018, and the first motion to extend discovery was

7

filed on January 17, 2018. As discussed above, the motions did not
show good cause for the failure to have discovered the facts sooner
because the movants did not dispute at the hearing that they failed
to

pursue

the

deposition

of

Mr.

Redfield

after

counsel

for

defendant Laughlin filed the notice of deposition duces tecum on
August 25, 2017.

Furthermore, the movants mentioned for the first

time at the hearing that they wanted to take other depositions in
addition to that of Mr. Redfield.
As to the utility requirement, there is not enough to show
that any specific facts probably exist that would come to light as
a result of any additional depositions.

As to the materiality

requirement, there is also not enough to show that any emergent
facts would influence the outcome of the pending summary judgment
motion. At the hearing, counsel for defendant Laughlin represented
that the deposition of Mr. Redfield is necessary because it will
show that Mr. Redfield made representations to defendant Laughlin
and the other movants that the insured lives had specific interests
in the relevant policies above and beyond their cash value, which
was self-sustaining and self-funding.

However, counsel for the

plaintiff suggested that Mr. Redfield’s deposition would establish
facts relating to collection and what the plaintiff can do to
enforce its rights under the loan documents.

Counsel for the

plaintiff then stated that such facts would not go to the issues

8

raised in its motion for summary judgment, which asks for judgment
that the amounts at issue are due and owning.
In summary, no affidavit or declaration was filed in the
instant case.

Even so, this Court has considered the matter as if

an

or

affidavit

declaration

was

filed,

and

finds

that

the

circumstances presented to this Court do not warrant an extension
of discovery or of time to respond to the plaintiff’s motion for
summary judgment.
IV.

Conclusion

For the reasons set forth above, the defendants’ motions to
extend discovery and time to respond to the plaintiff’s motion for
summary

judgment

(ECF

Nos.

130,

131,

and

132)

were

DENIED.

Accordingly, the Court DIRECTED the defendants to file their
responses to the plaintiff’s motion for summary judgment on or
before February 2, 2018.

The Court also DIRECTED the plaintiff to

file any reply on or before February 12, 2018.
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum
opinion and order to counsel of record herein.
DATED:

January 29, 2018

/s/ Frederick P. Stamp, Jr.
FREDERICK P. STAMP, JR.
UNITED STATES DISTRICT JUDGE

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