Paulino v. Dollar General Corporation et al
Filing
78
MEMORANDUM OPINION AND ORDER GRANTING PLAINTIFF'S MOTION 39 TO COMPEL AND AWARDING REASONABLE EXPENSES AND OVERRULING DEFENDANTS' 72 OBJECTIONS. The court lifts the stay of orders 55 and 71 . It is ordered that Plaintiff must file an affidavit of additional expenses by 5/3/2013. Signed by District Judge Gina M. Groh on 4/25/2013. (tlg)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
MARTINSBURG
STEPHANIE N. PAULINO,
Individually and as Class Representative,
Plaintiff,
v.
CIVIL ACTION NO. 3:12-CV-75
(JUDGE GROH)
DOLLAR GENERAL CORPORATION,
a foreign corporation, and DOLGENCORP,
LLC, a foreign corporation,
Defendants.
MEMORANDUM OPINION AND ORDER GRANTING PLAINTIFF’S MOTION TO
COMPEL AND AWARDING REASONABLE EXPENSES AND
OVERRULING DEFENDANTS’ OBJECTIONS
I. Introduction
Pending before this Court are Defendants’ Objections to Judge Seibert’s Original
Order and Amended Order Granting Plaintiff’s Motion to Compel and Awarding
Reasonable Expenses. On February 22, 2013, Defendants filed their objections to
Magistrate Judge Seibert’s Order and Amended Order. On March 11, 2013, Plaintiff
filed her responses to Defendants’ objections. On March 21, 2013, Defendants filed
their reply. On April 19, 2013, the Court held a hearing to permit oral argument on the
issues before the Court. Plaintiff appeared by counsel, David M. Hammer. Defendants
were represented by counsel, Joel S. Allen and Larry J. Rector. Upon consideration of
the written and oral arguments of counsel and for the following reasons, the Court
GRANTS Plaintiff’s Motion to Compel, OVERRULES Defendants’ objections to
1
Magistrate Judge Seibert’s Order and Amended Order, and AWARDS reasonable
expenses.
II. Factual Background and Procedural History
On July 10, 2012, Plaintiff, Stephanie Paulino, filed her complaint in the Circuit
Court of Berkeley County, West Virginia alleging that Defendants, Dollar General
Corporation and DolGenCorp, LLC, violated the West Virginia Wage Payment and
Collection Act (WPCA), W. Va. Code § 21-5-4, when they failed to pay Plaintiff her
wages in full within seventy-two hours of her termination. Plaintiff also alleges that
Defendants did not pay her liquidated damages and interest, as required by the statute
when a business does not comply with any rule under the WPCA, such as the seventytwo hour rule. Plaintiff asserts this claim on behalf of herself and all other former
employees who were terminated within five years of the filing of suit and not timely paid,
or, in the alternative, not paid the liquidated damages and interest as required by the
WPCA.
On August 15, 2012, Defendants removed the action to this Court pursuant to 28
U.S.C. § 1332(d), which gives the federal courts original jurisdiction over a class action
when: (1) “any member of a class of plaintiffs is a citizen of a State different from any
defendant,” 28 U.S.C. § 1332(d)(2)(A); (2) “the number of members of all proposed
plaintiff classes in the aggregate is less than 100,” 28 U.S.C. § 1332(d)(5)(B), and (3)
“the matter in controversy exceeds the sum or value of $5,000,000, exclusive of interest
and costs,” 28 U.S.C. § 1332(d)(1). Defendants submitted the Declarations of two of its
employees to establish the amount in controversy. Those Declarations, “based upon
2
personal knowledge of facts stated herein and the personnel records that are made,
maintained and stored by Dollar General in the ordinary course of business,” stated
during the relevant time period there had been 7,357 employment terminations1 and that
average check dollar amount during the applicable period was $286.11.2
On October 23, 2012, Plaintiff proceeded to serve her first set of discovery
requests. After she deemed Defendants’ responses deficient, and after meeting and
conferring in good faith to work out the deficiencies, Plaintiff filed the instant motion to
compel. Plaintiff’s motion to compel was referred to Magistrate Judge Seibert by this
Court. Defendants filed a response to the motion to compel on January 16, 2013.
Judge Seibert held an evidentiary hearing and argument on January 18, 2013.
On January 22, 2013, Judge Seibert issued his Original Order denying three of
the twelve document requests that Plaintiff moved to compel–Request Numbers 4, 13,
and 14. The Original Order stated that the “proper scope for discovery at this point
would be only those employees involuntarily terminated in West Virginia in the past five
years.” Therefore, the Original Order denied Request Numbers 4, 13, and 14 because
they sought production of documents relating to employees voluntarily terminated.
On January 29, 2013, Defendants filed an emergency motion for clarification
regarding Judge Seibert’s order granting Plaintiff’s motion to compel on Request
Number 5 which requested “[f]or each former employee who was employed during the
Period produce records concerning whether that employee voluntarily left employment
1
Declaration of Terry McSorely.
2
Declaration of Georgia Hannon.
3
or involuntarily left employment.” On January 30, 2013, Judge Seibert issued an order
stating he fully intended to grant Plaintiff’s motion to compel Request Number 5.
Defendants argued that the request asks whether employees were voluntarily or
involuntarily terminated, therefore it falls outside the scope of discovery. However,
Judge Seibert stated it was “Defendants’ disingenuous position that Plaintiff voluntarily
terminated her position that led the Court to grant the request.”3
On January 30, 2013, this Court granted Defendants’ motion for a partial and
temporary stay of Judge Seibert’s Original Order. On February 5, 2013, Defendants
filed their objections to Judge Seibert’s Original Order granting in part and denying in
part Plaintiff’s motion to compel and awarding reasonable expenses. Also on February
5, 2013, Judge Seibert conducted a hearing on the issue of the award of reasonable
expenses, including attorneys’ fees and sanctions. Following the hearing, on February
8, 2013, Judge Seibert entered an Amended Order granting Plaintiff’s Motion to Compel
in its entirety and awarding reasonable expenses due to Defendants’ position that
Plaintiff was voluntarily terminated. Judge Seibert declined to impose sanctions.
On February 19, 2013, this Court granted the parties’ joint motion for a
consolidated briefing schedule. This Court ordered that Defendants’ objections to the
Amended Order include argument responsive to Judge Seibert’s Amended Order and
Original Order. Then, Plaintiff was ordered to respond only to Defendants’ objections to
the Amended Order. On February 21, 2013, the Court granted Defendants’ motion for a
partial and temporary stay of Judge Seibert’s Amended Order.
3
See Defendants’ answer to Interrogatory 25, Doc. No. 32, Ex. 2.
4
On February 22, 2013, Defendants filed their objections to Judge Seibert’s
Amended and Original Order. On March 11, 2013, Plaintiff filed her response. On
March 21, 2013, Defendants filed their reply. On April 19, 2013, the Court held a
hearing to permit oral argument on the matter. Therefore, this issue has been fully
briefed and argued, and it is ripe for this Court’s review.
III. Standard of Review
Rule 72(a) of the Federal Rules of Civil Procedure permits a party to submit
objections to a magistrate judge’s ruling on non-dispositive matters, such as discovery
orders. FED. R. CIV. P. 72(a); see 28 U.S.C. § 636(b)(1)(A). As a non-dispositive
matter, the review of a magistrate judge’s discovery order is governed by the “clearly
erroneous” or “contrary to law” standard of review. Id.
Only if a magistrate judge’s decision is “clearly erroneous or contrary to law” may
a district court judge modify or set aside any portion of the decision. FED. R. CIV. P.
72(a); see 28 U.S.C. § 636(b)(1)(A). A court’s “finding is ‘clearly erroneous’ when
although there is evidence to support it, the reviewing court on the entire evidence is left
with the definite and firm conviction that a mistake has been committed.” United States
v. United States Gypsum Co., 333 U.S. 364, 395, 68 S. Ct. 525 (1948); see also
Harman v. Levin, 772 F.2d 1150, 1152 (4th Cir. 1985). “In light of the broad discretion
given to a magistrate judge in the resolution of nondispositive discovery disputes, the
court should only overrule a magistrate judge’s determination if this discretion is
abused.” Shoop v. Hott, 2010 WL 5067567, *2 (N.D.W. Va. Dec. 6, 2010) (citing
Detection Sys., Inc. v. Pittway Corp., 96 F.R.D. 152, 154 (W.D.N.Y. 1982)).
5
IV. Analysis
A.
Scope of Discovery
Unless limited by a court order, parties in civil litigation enjoy broad discovery as
detailed in Federal Rule of Civil Procedure 26(b)(1):
Parties may obtain discovery regarding any nonprivileged matter that is
relevant to any party’s claim or defense-including the existence,
description, nature, custody, condition, and location of any documents or
other tangible things and the identity and location of persons who knows
of any discoverable matter . . . . Relevant information need not be
admissible at the trial if the discovery appears reasonably calculated to
lead to the discovery of admissible evidence.
FED. R. CIV. P. 26(b)(1). “[T]he discovery rules are given ‘a broad and liberal
treatment.’” Nat’l Union Fire Ins. Co. of Pittsburgh, P.A. v. Murray Sheet Metal Co.,
Inc., 967 F.2d 908, 983 (4th Cir. 1992) (quoting Hickman v. Taylor, 329 U.S. 495, 507,
67 S. Ct. 385, 391-92 (1947)). The discovery sought must be “relevant”; however, it
need not be admissible at the trial if the discovery appears reasonably calculated to
lead to admissible evidence. FED. R. CIV. P. 26(b)(1). To be “relevant information,” the
information sought must be “any matter that bears on, or that reasonably could lead to
other matter that could bear on, any issues that is or may be in the case.” Hickman,
329 U.S. at 501.
A crucial issue, hotly contested by the parties, is whether the Court’s Scheduling
Order limited the scope of discovery. For the reasons that follow, the Court’s
Scheduling Order clearly did not limit or bifurcate discovery. Instead, the Court’s
Scheduling Order applied to all discovery and set a deadline for discovery completion
for all discovery. On August 21, 2012, the Court issued its “First Order and Notice
6
Regarding Discovery and Scheduling Conference” [Doc. 4]. The parties were ordered
to have their initial planning meeting on or before September 21, 2012. The parties
were also ordered to submit their 26(f) meeting report to the Court on or before October
5, 2012. The parties submitted their Rule 26(f) report on October 5, 2012. The parties’
26(f) report stated that
Plaintiff’s position is that all discovery should be commenced in time is to
be completed by July 19, 2013. Defendants’ position is that an initial
phase of discovery limited to issues relevant to class certification should
be completed and class certification ruled upon by the Court prior to any
determination of a final deadline for all discovery related to the merits of
the action.
[Doc. 15]. The parties also submitted a scheduling order checklist with proposed dates
for the Court’s scheduling order. In the parties’ submitted Scheduling Order Checklist,
Defendants argued that “the corresponding dates for scheduling of merits discovery,
dispositive motions, pre-trial and trial deadlines should not be set at this time and should
instead be set after the Court’s determination of whether the standards for certification
of that matter as a class action have been met.” [Doc. 16]. Defendants also suggested
that the Court’s Scheduling Order adopt a bifurcated class and merits discovery
schedule, and for the Court to replace the deadline for dispositive motions to state
“Class Certification Motions.”
Defendants also filed an Addendum to “Scheduling Order” Checklist where the
Defendants proposed the following:
that the “checklist” instead provide a bifurcated schedule for limited
“Phase I” discovery where the proposed dates for “expert disclosures,”
“discovery” and “motions” are established as the “Phase I” dates for
experts, discovery and motions limited to class certification issues.
Alternatively, Defendants propose that if a more accelerated schedule is
preferred by the Court, then Phase I discovery should end on or after
7
March 2013 rather than setting a non-bifurcated discovery schedule.
Upon determination of all class certification issues, Defendants propose
that the parties and the Court would thereafter confer upon a Phase II
merits discovery, pretrial and trial schedule.
[Doc. 17].
On October 18, 2012, the Court issued its Scheduling Order without any limit on
the scope of discovery. The Scheduling Order adopted all dates proposed in the
Scheduling Order Checklist, with the exception of moving the proposed final pretrial
conference date from October 25, 2013 to November 1, 2013. Therefore, the Court’s
Scheduling Order contained deadlines for discovery completion, motion
practice/dispositive motions, Federal Rule 26(a)(3) disclosures, voir dire, jury
instructions, verdict forms, motions in limine, joint pretrial order, final pretrial conference,
and trial. The Court did not limit its deadlines to a Phase I. In fact, the Court’s
Scheduling Order did not adopt, define, or mention any “phases” for discovery. The
Court’s Scheduling Order does not mention the word “bifurcate.” The Court’s
Scheduling Order does not change the “motion practice/dispositive motions” deadline to
“Class Certification Motions” as urged by Defendants. Therefore, it is clear the Court’s
Scheduling Order did not adopt Defendants’ suggestion to bifurcate discovery.
Defendants argue that the Court’s Scheduling Order did not address the “scope”
of discovery or “contain rulings or guidance on the permissible scope of discovery.”
Defendants are misguided in this argument. The Court set the discovery deadline as
July 19, 2013–the date submitted in the Scheduling Order Checklist–not the dates
proposed by Defendants in the Addendum to “Scheduling Order Checklist” that urged
the Court to enter deadlines bifurcating discovery. Additionally, the Court’s Scheduling
8
Order defined “Discovery Completion” as follows:
All discovery shall be fully served and completed by July 19, 2013.
“Completed discovery” as used in Fed. R. Civ. P. 16(b) means that all
discovery requests are to be filed far enough in advance to be completed
as required by the rules before the discovery deadline. Objections,
motions to compel and all other motions relating to discovery in this civil
action should be filed as soon as the problem arises, but are to be filed no
later than one week after the discovery completion date. The Court will
not consider any discovery related motions untimely filed after the above
deadline.
The term “all discovery” in the preceding definition of “completed
discovery” includes the disclosures required by Fed. R. Civ. P. 26(a)(1),(2)
and (5), but does not include the disclosures required by Fed. R. Civ. P.
26(a)(3).
[Doc. 19] (emphasis added). The Court’s Scheduling Order does not limit or bifurcate
discovery. Indeed, the Court’s Scheduling Order clearly states “all discovery shall be
fully served and completed by July 19, 2013.” Id. Therefore, the Scheduling Order did
not adopt the Defendants’ vision to bifurcate discovery into phases. During the hearing,
Defendants argued, although it was not mentioned in their briefs, that they thought there
may have been a mistake in the Scheduling Order as it did not include a class
certification deadline and that by objecting to Plaintiff’s discovery requests, Defendants
could “tee up” the issue regarding the scope of discovery to get it in front of the Judge.
If Defendants were confused by or thought there was a mistake in the Court’s
Scheduling Order, Defendants could have easily filed a motion for clarification as they
promptly did in response to Judge Seibert’s Original Order rather than disregarding the
plain language mandate of the Scheduling Order and utilizing a circuitous and
needlessly expensive route to get the issue before this Court.
9
B.
Defendants’ Objections to Magistrate Judge Seibert’s Original Order
and Amended Order
With the proper framework in mind regarding the Court’s Scheduling Order and
the understanding that the Court did not limit discovery, the Court will now address the
Defendants’ objections to Judge Seiberts’s Original Order and Amended Order.
1.
First Objection: Orders Compelling Defendants to Produce Documents in
Response to Plaintiff’s Request Numbers 4, 5, 13, and 14 for Employees Who
Voluntarily Left Employment4
Defendants argue that Judge Seibert’s Original Order limiting discovery to “those
employees involuntarily terminated in West Virginia in the past five years” is the correct
ruling as Judge Seibert’s Amended Order expanding discovery to include voluntarily and
involuntarily terminated employees’ records lacked a reasonable basis. Judge Seibert’s
Amended Order granted discovery of voluntarily and involuntarily terminated former
employees’ records because it was within the proper scope of discovery as Defendants
maintained that Plaintiff, in fact, was voluntarily terminated. Additionally, Judge Seibert
stated that “[t]his expanded discovery will better aid Plaintiff in representing to the Court
whether she meets the standard for Rule 23 class certification, particularly the typicality
and commonality of the claims and defenses.”
The Court does not find that Judge Seibert’s ruling was clearly erroneous or
contrary to law. Federal Rule of Civil Procedure 26(b) provides for broad discovery
regarding any “nonprivileged matter that is relevant to any party’s claim or defense-
4
The Original Order originally denied most of Plaintiff’s requests regarding employees
who “voluntarily” left employment with Defendants (except for Plaintiff’s Request No. 5, which
was granted). However, the Amended Order ultimately granted all of Plaintiff’s discovery
requests regarding employees who “voluntarily” left employment after Defendants continued to
assert that Plaintiff was “voluntarily” terminated under a constructive abandonment theory.
10
including the existence, description, nature, custody, condition, and location of any
documents or other tangible things and the identity and location of persons who know of
any discoverable matter . . . . Relevant information need not be admissible at the trial if
the discovery appears reasonably calculated to lead to the discovery of admissible
evidence.” FED. R. CIV. P. 26(b)(1).
Defendants contend that their asserted defense should not be used to expand
the scope of discovery; however, Rule 26(b)(1) specifically provides that “parties may
obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim
or defense.” FED. R. CIV. P. 26(b)(1) (emphasis added). Additionally, Plaintiff’s request
for the records of voluntarily terminated employees is relevant. Defendants
characterized Plaintiff’s alleged involuntary termination as a “voluntary termination”
under a “constructive abandonment” theory. In this case, Plaintiff was terminated after
she failed a drug test. Defendants maintain that Plaintiff’s position was constructively
abandoned, and thus voluntarily terminated under the WPCA, because Plaintiff failed to
comply with Defendants’ drug policies. The WPCA only provides for payment of an
employee’s wages in full within seventy-two hours if the employee was discharged. W.
VA. CODE § 21-5-4(b). The West Virginia Code of State Rules defines discharged, as
used in the West Virginia WPCA, as “any involuntary termination of the cessation of
performance of work by employee due to employer action.” W. VA. C.S.R. § 42-5-2.8
(emphasis added). Therefore, the distinction between a voluntary terminated employee
and an involuntarily terminated employee is key to Plaintiff’s claim and the prospective
class action.
11
Thus, Plaintiff’s discovery requests regarding individuals labeled by Defendants
as “voluntarily terminated” is relevant as individuals labeled as “voluntarily terminated”
by Defendants may nonetheless be “involuntarily terminated” for purposes of the
WPCA. As the scope of discovery was discussed previously in this Order, the Plaintiff
may properly seek discovery regarding Defendants’ former employees who were
involuntarily terminated and voluntarily terminated as it is relevant to class certification
under Rule 23. Accordingly, the Court OVERRULES Defendants’ objection and
AFFIRMS Judge Seibert’s ruling.
2.
Defendant’s Second Objection: Disclosure of All Names and Contact
Information
Defendants argue that the “disclosure of names and contact information,
including that sought by way of Plaintiff’s Request N[umbers] 3, 4, 5, 13, 14 and 15
should only follow, if at all, when a class has been certified.” Defendants also contend
that providing Plaintiff with names and contact information “could potentially provide
Plaintiff’s counsel with information for the sole purpose of identifying new subclasses or
initiating entirely new litigation.” Defendants argue that Judge Seibert’s Order “cite[d] no
cases for the proposition that a plaintiff is entitled, without justification or reasonable
grounds, to discover all names, addresses, telephone numbers, pay and employment
records of individuals in a large state-wide putative class action, particularly given the
class allegation is supported only by bare allegations of a single complaint.” Therefore,
Defendants state that their objections to Request Numbers 5 and 15 should have been
sustained on grounds of relevancy.
In this case, Defendants have suggested that Plaintiff was “voluntarily
12
terminated” for failing a drug test; however, Plaintiff argues that she was “involuntarily
terminated” and thus the seventy-two hour rule under the WPCA applies. Plaintiff’s
request for the contact information of all employees, voluntarily and involuntarily
terminated, is relevant as Defendants have claimed that Plaintiff was voluntarily
terminated.5 Judge Seibert found that the information was relevant and helpful to
Plaintiff’s putative class action. As stated above, to be “relevant information,” the
information sought must be “any matter that bears on, or that reasonably could lead to
other matter that could bear on, any issues that is or may be in the case.” Hickman,
329 U.S. at 501. Rule 26(b)(1) also provides for the discovery of the “identity and
location of persons who know of any discoverable matter,” i.e. contact information. FED.
R. CIV. P. 26(b)(1). In this case, the information is relevant because Defendants may
have labeled a former employee’s termination as voluntarily terminated even though, in
reality, the former employee was involuntarily terminated and the seventy-two hour rule
under the WPCA would apply. Therefore, Plaintiff has reasonable grounds for
requesting the contact information of former employees to determine whether they
were, in fact, voluntarily or involuntarily terminated. This information is relevant and
reasonably calculated to lead to the discovery of admissible evidence. Additionally, the
information would be necessary to determine the Rule 23 certification issues regarding
5
Plaintiff’s Interrogatory No. 25: “State all facts known to the Defendants at the
time of responding to this interrogatory upon which the Defendants rely in contending
that the Plaintiff was timely and properly paid consistent with the requirements of the
West Virginia Wage Payment and Collection Act.”
Defendants’ Answer: “Defendants believe that Plaintiff voluntarily engaged in
activities that caused her to fail a drug test, and as a result believe therefore that her
position was constructively abandoned or resigned without notice.” [Doc. 32-2].
13
whether “(1) the class is so numerous that joinder of all members is impracticable; (2)
there are questions of law or fact common to the class; (3) the claims or defenses of the
representative parties are typical of the claims or defenses of the class; and (4) the
representative parties will fairly and adequate protect the interests of the class.” FED. R.
CIV. P. 23(a).
Defendants also suggest a de facto ban, at this point, on Plaintiff’s
communication with potential putative class members by requesting the Court prohibit
disclosure of prospective putative class members’ contact information.6 In Gulf Oil Co.
v. Bernard, the Supreme Court addressed the power of a district court to limit
communications from named plaintiffs and their counsel to prospective class members
prior to class certification under Rule 23 of the Federal Rules of Civil Procedure. 452
U.S. 89, 91, 101 S. Ct. 2193 (1981). The Supreme Court recognized that class actions
present opportunities for abuse. Id. at 100. Thus, “a district court has both the duty and
the broad authority to exercise control over a class action and to enter appropriate
orders governing the conduct of counsel and parties.” Id.
In Gulf Oil, the Supreme Court rejected a total ban on communication between
the plaintiff and putative class members, and held that an order that limits a party’s
6
Defendants argue they have not sought a communication ban. Although
Defendants have not asked outright for a communication ban, that is because they are
refusing to disclose any of the prospective class members’ contact information.
Defendants have essentially requested a de facto communication ban by objecting to
the disclosure of prospective class members’ names and contact information for fear
that Plaintiff’s attorney would contact them to drum up new clients—without disclosure
of the names and contact information, it is nearly impossible for Plaintiff to communicate
with other prospective class members. Therefore, this results in a de facto
communication ban and, at the least, making the Supreme Court’s analysis and
decision in Gulf Oil useful to this Court.
14
ability to communicate with putative class members “should be based on a clear record
and specific findings that reflect a weighing of the need for a limitation and the potential
interference with the rights of the parties.” Id. at 101. The order should be based on “a
specific record showing by the moving party of the particular abuses by which it is
threatened.” Id. at 102 (quoting Coles v. Marsh, 560 F.2d 186, 189 (3d Cir. 1977)).
The result should be “a carefully drawn order that limits speech as little as possible,
consistent with the rights of the parties under the circumstances,” and the court must
give “explicit consideration to the narrowest possible relief which would protect the
respective parties.” Id. The Court rejected the limitation the district court placed on the
plaintiffs’ communication with putative class members because the district court
“identified nothing in [the communication] that it thought was improper and . . . gave no
reasons” that supported the limitation. Id. at 103.
In applying the standard pronounced in Gulf Oil, this Court must first determine
whether a limitation on Plaintiff’s communication with putative class members is
necessary. “In order for the moving party to show that a limitation is necessary, ‘[t]wo
kinds of proof are required. First, the movant must show that a particular form of
communication has occurred or is threatened to occur. Second, the movant must show
that the particular form of communication at issue is abusive in that it threatens the
proper functioning of the litigation.’” The Kay Co., LLC v. Equitable Prod. Co., 246
F.R.D. 260, 262 (S.D.W. Va. 2007) (quoting Cox Nuclear Med. v. Gold Cup Coffee
Servs., Inc., 214 F.R.D. 696, 697-98 (S.D. Ala. 2003) (internal citations omitted))
Defendants must show not only that a communication has occurred or is
15
threatened to occur, but also that the particular form of communication is abusive.
“Abusive practices that have been considered sufficient to warrant a protective order
include communications that coerce prospective class members into excluding
themselves from the litigation; communications that contain false, misleading or
confusing statements; and communications that undermine cooperation with or
confidence in class counsel.” The Kay Co., LLC, 246 F.R.D. at 263 (citations omitted).
Defendants argue that “disclosing names and contact information for thousands of
former employees can serve impermissible purposes–identifying additional putative
plaintiffs to generate additional subclasses or lawsuits and/or needlessly result in
intrusion on personal privacy.” Defendants have not alleged that Plaintiff’s occurred or
threatened to occur communication distributes false, misleading, or confusing
statements. Thus, a limitation on Plaintiff’s communication with class members is
inappropriate.
As the contact information has already been determined to be relevant and within
the proper scope of discovery, the Court OVERRULES Defendants’ objection and
AFFIRMS Judge Seibert’s ruling. Additionally, the Court notes that there is a protective
order in place regarding “both personal and job-related employee information including
any documents regarding payroll-related information” that should alleviate any concern
regarding the distribution, transmission, or disclosure of any document or other material
marked confidential and its contents to persons not listed on the Protective Order [Doc.
27].
16
3.
Third Objection: Production of“Class List,” Contact Information, Employment
Records and Payroll Records of Voluntarily Terminated Employees
Defendants argue that Plaintiff’s request should be denied because they are “on
the face of it and in practice, overly broad, unduly burdensome and beyond the
reasonable scope of discovery before an order on class certification has been entered.”
Again, Defendant urges for a “limited scope of representative sample” prior to
certification of the class.
District courts have wide discretion in conducting a class action to issue orders
that “determine the course of proceedings.” FED. R. CIV. P. 23(d). Discovery may be
used to “illuminate issues upon which a district court must pass in deciding whether a
suit should proceed as a class action under Rule 23, such as numerosity, common
questions, and adequacy of representation.” Oppenheimer Fund, Inc. v. Sanders,
437 U.S. 340, 98 S. Ct. 2380, n. 13 (1978) (citing Annot. Discovery for Purposes of
Determining Whether Class Action Requirements Under Rule 23 (a) and (b) of Federal
Rules of Civil Procedure Are Satisfied, 24 A.L.R. Fed. 872 (1975)). Indeed, district
courts in the Fourth Circuit have held that “discovery relating to class allegations is
proper prior to certification” and “the Court is unable to intelligently rule on the question
[of class certification] without information from the parties, which is usually gathered
through normal discovery . . . .” Am. Fin. Sys. Inc. v. Pickrel, 1974 WL 105, *4 (D. Md.
Feb. 1, 1974) (citing cases in the Fourth Circuit with similar holdings). Although
Defendants suggest that discovery on the merits prior to certification of a class is a
foreign and even incorrect concept, many federal courts have permitted discovery on
the merits prior to class certification. In re Rail Freight Fuel Surcharge Antitrust
17
Litig., 258 F.R.D. 167, 173-174 (D.C. 2009) (refusing to bifurcate discovery where “the
evidence plaintiffs need for certification purposes is closely intertwined with the merits
evidence”); In re Plastics Additives Antitrust Litig., 2004 WL 2743591, *3-4 (E.D. Pa.
Nov. 29, 2004) (finding certification and merits discovery to be “sufficiently intermingled”
when plastic companies entered into a national price-fixing conspiracy because the
discovery needed to prove the existence of the conspiracy (merits) and the
consequential damages to the class members (certification) overlapped).
As pointed out by Defendants, “district courts are required to balance the need to
promote effective case management, the need to prevent potential abuse, and the need
to protect the rights of all parties.” Tracy v. Dean Witter Reynolds, Inc., 185 F.R.D.
303, 304-05 (D. Colo. 1998) (citing Shushan v. Univ. of Colo., 132 F.R.D. 263, 267-68
(D. Colo. 1990)). In weighing the evidence, Judge Seibert limited the scope of
discovery to a five year period contained to Defendants’ former employees in West
Virginia regarding a narrow issue of Defendants’ compliance with the WPCA. In this
case, Judge Seibert concluded that discovery of contact information, employment
records, and payroll records of voluntarily terminated employees was necessary for
Plaintiff to attempt to satisfy the standards of Rule 23. As explained above, this was
based on Defendants’ categorization of Plaintiff as “voluntarily terminated” through
constructive resignation. Although Defendants now argue that Plaintiff was classified as
involuntarily terminated in her personnel record, the documents regarding voluntarily
terminated individuals is reasonably necessary for Plaintiff to determine if Defendants
have mislabeled a former employee as “voluntarily” terminated rather than “involuntarily”
18
terminated. To certify the class, Plaintiffs must establish that “the questions of law or
fact common to class members predominate over any questions affecting only individual
members and that a class action is superior to other available methods for fairly and
efficiently adjudicating the controversy.” FED. R. CIV. P. 23(b)(3). Discovery of
documents of “voluntarily” terminated former employees will aid the Plaintiff in
determining (1) whether the individuals were in fact involuntarily terminated and (2)
whether the individuals were not paid according to the seventy-two hour rule. Plaintiff
most likely must secure such evidence to satisfy this “predominance” requirement.
Although Defendants insist that this Court should limit the scope of discovery to class
certification discovery and exclude merits discovery at this point, the Court finds the
limited scope of discovery fails to promote judicial economy as it would require “ongoing
supervision of discovery.” In re Rail Freight Fuel Surcharge Antitrust Litig., 258
F.R.D. at 174. If the Court did limit discovery to only class certification, this Court
“would likely have to resolve various needless disputes that would arise concerning the
classification of each document as ‘merits’ or ‘certification’ discovery.” Id. (quoting In re
Urethane Antitrust Litig., 237 F.R.D. 454, 459 (D. Kan. 2006)). The Court finds that
creating such a distinction in this case would also result in “significant duplication of
effort and expense to the parties.” Id. (quoting MANUAL FOR COMPLEX LITIGATION
(FOURTH) § 11.213). Accordingly, Judge Seibert’s ruling was not “clearly erroneous” or
“contrary to the law,” and the Court OVERRULES Defendants’ objection and AFFIRMS
Judge Seibert’s ruling.
19
C.
Reasonable Expenses and Sanctions
Defendants argue that Plaintiff is not entitled to recovery of attorneys’ fees and
expenses because Defendants’ objections were “substantially justified.” Judge Seibert
granted Plaintiff’s Motion to Compel in its entirety. Therefore, in determining whether to
award reasonable expenses, the Court looks to Federal Rule of Civil Procedure
37(a)(5)(A). Federal Rule of Civil Procedure 37 provides that if a motion for an order
compelling disclosure or discovery
is granted–or if the disclosure or requested discovery is provided after the
motion was filed–the court must, after giving an opportunity to be heard,
require the party or deponent whose conduct necessitated the motion, the
party or attorney advising that conduct, or both to pay the movant’s
reasonable expenses incurred in making the motion, including attorney’s
fees. But the court must not order this payment if:
(i) the movant filed the motion before attempting in good faith to
obtain the disclosure or discovery without court action;
(ii) the opposing party’s nondisclosure, response, or
objection was substantially justified; or
(iii) other circumstances make an award of expenses unjust.
FED. R. CIV. P. 37(a)(5)(A).
Plaintiff is entitled to reasonable expenses unless Defendants’ failure to respond
was “substantially justified,” special circumstances make the award unjust, or Plaintiff
failed to meet and confer before filing the motion. Plaintiff’s counsel attempted in good
faith to resolve the discovery disputes prior to filing the instant motion to compel. On
December 4, 2012, Plaintiff’s counsel contacted Defendants’ counsel by letter to resolve
the discovery dispute. Plaintiff’s counsel states “I’m writing in a good faith effort to
resolve disputes regarding the unverified, unsigned Defendants’ Responses and
Objections to Plaintiff’s Requests for Production and Defendants’ Answers and
20
Objections to Plaintiff’s Interrogatories . . . .” [Doc. 32-4]. Also, in defending against the
award of reasonable attorneys’ fees and expenses, Defendants have argued only that
its objections were substantially justified. Therefore, the Court, upon reviewing
Defendants’ objections, finds that special circumstances do not make an award unjust.
Therefore, the Court analyzes the award of attorneys’ fees under Federal Rule of Civil
Procedure 27(a)(5)(A)’s second prong.
In order for Plaintiff to be awarded costs, Defendants’ nondisclosure, response,
and objections must not have been substantially justified. The Fourth Circuit Court of
Appeals noted that the substantial justification standard was met when “[a]t the very
least, a reasonable person could differ as to the appropriateness of the contested
action.” Bryte v. Am. Household, Inc., 142 Fed. Appx. 699, 703 (4th Cir. 2005) (citing
Pierce v. Underwood, 487 U.S. 552, 565, 108 S. Ct. 2541 (1988) (noting that
“substantially justified” means a “genuine dispute” where “reasonable people could differ
as to [the appropriateness of the contested action]”) (citations and internal quotation
marks omitted). Additionally, “the ability to make a plausible case . . . is all that is
required for substantial justification.” Twigg v. Pilgrim’s Pride Corp., 2007 WL 676208
* 5 (N.D.W. Va. Mar. 1, 2007).
First, Defendants state it had a substantial justification for its objections because
it objected to “producing private, confidential and personal information of former
employees” which “is a ground recognized as a ‘substantially’ justifiable position.”
Defendants cite Smith v. Montgomery County, 573 F. Supp. 604, 614 (D. Md. 1985),
stating that the district court found “that because there were ‘significant privacy grounds
21
for objecting to disclosure of detainees’ names,’ an award of attorney’s fees was not
appropriate.” However, in Smith, the district court denied plaintiff’s motion for
reasonable costs, including attorneys’ fees, because plaintiff moved to compel the name
of the detainee who was present during a strip search of plaintiff as well as the names
of other temporary detainees who had been strip searched without probable cause and
defendants had “significant privacy grounds for objecting to disclosure of the detainees’
names.” Id. However, a key difference between the Smith case and this case is that in
Smith there was no protective order in place whereas this case has a protective order in
place. In fact, in Smith, Defendants had moved for a protective order to limit disclosure
of the detainees’ names. In this case, a protective order was in place essentially
restricting any private, confidential, and personal information to the case participants
and court users. Thus, the privacy grounds for objecting to disclosure that were present
in Smith are not present here.
Second, Defendants argue that its objections were not “general” or “boilerplate”
and should not be used as a basis for awarded expenses. Defendants contend that
although their objections contained general or boilerplate language, the objections also
contained specific grounds.
An objection to requested discovery may not be made until after a lawyer has
“paused and consider[e]d” whether, based on a “reasonable inquiry,” there is a “factual
basis [for the] . . . objection.” FED. R. CIV. P. 26(g) advisory committee’s notes to the
1983 amendments. Generalized objections are highly disfavored in the Fourth Circuit.
See Mainstreet Collection, Inc. v. Kirkland’s, Inc., 270 F.R.D. 238 (E.D.N.C. 2010)
22
(mere recitation of the familiar litany that a request is overly broad, burdensome,
oppressive, and irrelevant does not constitute a specific objection); Hager v. Graham,
267 F.R.D. 486, 492 (N.D.W. Va. 2010) (“General objections to discovery, without more,
do not satisfy the burden of the responding party under the Federal Rules of Civil
Procedure to justify objections to discovery because they cannot be applied with
sufficient specificity to enable courts to evaluate their merits.”); Mills v. East Gulf Coast
Preparation Co., LLC, 259 F.R.D. 118, 132 (S.D.W. Va. 2009) (“boilerplate objections
regurgitating words and phrases from Rule 26 are completely unacceptable.”); Mancia
v. Mayflower Textile Servs. Co., 253 F.R.D. 354 (D. Md. 2008) (court disapproves of a
general objection asserted “to the extent” that it applies); Frontier-Kemper
Constructors, Inc. v. Elk Run Coal Co., Inc., 246 F.R.D. 522, 530-31 (S.D.W. Va.
2007) (finding that boilerplate objections to defendant’s requests for production of
documents, which indicated simply that requests were overbroad, unduly burdensome,
and not reasonably calculated to lead to discovery of admissible evidence, did not
comply with the rule, which required specific objections). “The failure to particularize
[an] objection[] as required leads to one of two conclusions: either the Defendants
lacked a factual basis to make the objections that they did, which would violate Rule
26(g), or they complied with Rule 26(g), made a reasonable inquiry before answering
and discovered facts that would support a legitimate objection, but they were waived for
failure to specify them as required.” Mancia, 253 F.R.D. at 364. A party’s reliance on
general objections often results in the waiver of all specific objections. FED. R. CIV. P.
33(b)(4). “While Rule 34 lacks similar waiver provisions, this Court has applied the
23
waiver provision applicable to interrogatories under Rule 33 to document production
requests.” Cain v. Liberty Mut. Ins. Co., 2011 WL 1833096 (N.D.W. Va. May 13,
2011).
In Deakins v. Pack, the Court stated that:
[i]n most if not all cases, an objection to a discovery request in conformity
with the Rules will contain (1) a recital of the parties’ claims and defenses,
(2) a summary of the applicable statutory and/or case law upon which the
parties’ claims and defenses are predicated including the elements of
each claim or defense, (3) a discussion of Court decisions considering the
breadth or scope of discovery and any limitations upon discovery in the
same or a similar type of case and (4) a statement respecting how and/or
why the request seeks information which is irrelevant or will not likely lead
to the discovery of relevant information or is vague, overly broad,
burdensome or interposed for an improper purpose. Failure to state
objections specifically in conformity with the Rules will be regarded as a
waiver of those objections.
2012 WL 242859, *4 (S.D.W. Va. Jan. 25, 2012) (citing Sabol v. Brooks, 469 F. Supp.
2d 324, 328 (D. Md. 2006)).
Judge Seibert granted Plaintiff’s Request Numbers 3, 4, 5, 8, 15, 17 and 24.
Judge Seibert found that Defendants “generally objected, and reiterated its contention
that this class-wide discovery should not be permitted.” Defendants object to Judge
Seibert’s rulings granting Plaintiff’s Discovery Requests Numbers 3, 4, 5, 8, 15, 17, and
24 because their objections were not “impermissible ‘boilerplate’ objections” and were
“supported by particularized facts and specific grounds.”
As this Court has stated, and Judge Seibert found in his orders, the scope of
discovery was not bifurcated and any belief otherwise was in direct contravention of the
Court’s Scheduling Order. Therefore, any objection based on Defendants’ assertion
that “class-wide discovery should not be permitted” is unpersuasive and violates the
24
scope of discovery as announced in this Court’s Scheduling Order.
Also, Defendants objected to the documents requested on the grounds that they
are “not relevant or reasonably calculated to lead to the discovery of admissible
evidence, assumes facts not in evidence, and that the request is overly broad and
unduly burdensome.” See Objection to Request No. 87; Objection to Request No. 17.8
7
No. 8: Produce all communications, including electronically stored
communications to payroll service providers (such as First Data’s Pay Stub Portal)
concerning the timing and/or issuance of final wages due to employees during the
Period.
OBJECTIONS: Defendants object to Request No. 8 on the grounds that it is seeks
documents that are not relevant or reasonably calculated to lead to the discovery of
admissible evidence. Defendants further object to Request No. 8 on the grounds that it
assumes facts not in evidence; specifically, that “First Data’s Pay Stub Portal” is a
payroll service provider. Defendants further object to Request No. 8 on the grounds
that it is overly broad and unduly burdensome with because all “communications”
concerning “the issuance of the final wages” could encompass numerous documents
having no relevance to Plaintiff’s claims.
RESPONSE: Subject to and without waiving the foregoing objections, Defendants
respond as follows: Defendant does not possess documents of communications to
payroll service providers concerning the administration of individual employee payroll.
Defendants will produce the contracts between Dollar General and First Data
Corporation.
8
No. 17: Produce all documents concerning the timing of final payment to
employees during the Period that were provided to or received from First Data’s Pay
Stub Portal.
OBJECTIONS: Defendants object to Request No. 17 on the grounds that it is vague,
ambiguous and confusing as to the meaning of Request, including but not limited to the
phrase of “that were provided to or received from First Data’s Pay Stub Portal.”
Defendants further object to Request No. 17 on the grounds that it seeks “all
documents” related to timing of final pay for all employees who separated during the
period. The Court should not have to determine the merits of each individual class
member’s claim to determine whether or not a class is proper or whether any given
individual is a class member. Defendants further object to Request No. 17 on the
grounds that it seeks information that is not relevant or reasonably calculated to lead to
the discovery of admissible evidence. To the extent that Request No. 17 seeks
25
The details provided by Defendants regarding why the requests are objectionable do
not permit the Plaintiff to adequately respond nor is it useful to the Court in ruling on a
discovery motion. For example, in objection to Request Number 3, Defendants object
“on the grounds that it seeks documents or information that is not relevant or reasonably
calculated to lead to the discovery of admissible evidence. This Request appears to be
a fishing expedition whose purpose is to identify a representative Plaintiff for a new
subclass or new lawsuit.” This objection does not provide particularized facts as to why
the documents are not relevant, or even reasonably calculated to lead to the discovery
of admissible evidence. Additionally, the Court entirely disregards the Defendants’
general objection that Plaintiff is on a “fishing expedition.” The Federal Rules of Civil
Procedure allow courts to “determine the pond, the type of lure, and how long the
parties can leave their lines in the water.” Eli Lilly & Co. v. InvaGen Pharms., Inc.,
1:09-CV-87-WTL-TAB (S.D. Ind. Sept. 17, 2009). As already discussed, the Court
defined the scope of discovery, and consequently “the pond,” in its Scheduling Order.
In objection to Request Number 24, Defendants state that “it is not relevant to
Plaintiff’s claim or reasonably calculated to lead to the discovery of admissible evidence,
and is premature to the extent that it seeks to establish class-wide damages.”9 Again,
documents that are relevant, there are far less burdensome means of obtaining the
relevant information, such as payroll records.
9
No. 24: If the Defendants contend that they (either individually or jointly) did, as
a matter of practice or policy, pay liquidated damages and statutory interest to
employees who were separated from employment during the Period but who were not
paid their wages within the time periods specified in the Wage Payment and Collection
Act produce documents concerning such payment(s).
OBJECTIONS: Defendants object to Request No. 24 on the grounds that it calls for a
26
the Defendants’ boilerplate objection fails to provide particularized facts regarding how
and why the request seeking to establish class-wide damages is outside the scope of
discovery or unduly burdensome at this point. The boilerplate and general objection
language is throughout the entirety of Defendants’ objections to Plaintiff’s Request
Numbers 3, 4, 5, 8, 15, 17 and 24. Additionally, as discussed in the Court’s analysis of
the scope of discovery, Plaintiff’s requests are within the scope.
Defendants cite Hager for the proposition that “specific grounds in addition to the
boilerplate is permissible. The Rule states that the responding party must specify the
grounds for each objection. It does not say that a general objection in addition to the
specific grounds is noncompliant.” Hager, 267 F.R.D. at 492. The key difference is that
in this case, the “specific grounds” used to object were based upon the Defendants’
argument that discovery should not be conducted on the merits, but rather limited to the
certification issue. As discussed thoroughly above, the Scheduling Order did not limit
discovery in any way. Accordingly, the specific grounds, if any, lacked a substantial
justification as they violated this Court’s Scheduling Order.
Third, Defendants argue that their objections to “across-the-board discovery of
information about all former employees or an entire putative class were ‘substantially
legal conclusion as to whether any employee was “paid their wages within the time
periods specified in the Wage Payment and Collection Act.” Defendants further object
to Request No. 24 on the grounds that it is not relevant to Plaintiff’s claim or reasonably
calculated to lead to the discovery of admissible evidence, and is premature to the
extent that it seeks to establish class-wide damages.
RESPONSE: Subject to and without waiving the foregoing objections, Defendants state
that they do not maintain any “policy” document regarding the payment of liquidated
damages and statutory interest, and thus there are no responsive documents.
27
justified’ and not ‘general objections.’” Defendants argue that there is a substantial body
of case law supporting their position that discovery should be limited to the certification
issue or the merits of Plaintiff’s claim–not to the merits of the putative class’s claim.
Again, as explained above, Defendants attempt to place a limit on discovery. The
Court’s Scheduling Order clearly did not limit the scope of discovery and substantial
case law also supports this Court’s decision to allow both merits-based and certificationbased discovery. Therefore, Defendants have no substantial justification for not
providing information regarding the putative class.
Last, Defendants argue that they at least had a substantial justification for
objecting to the disclosure of employees’ records that were voluntarily terminated,
particularly in light of Judge Seibert’s Original Order denying the discovery requests for
information of voluntarily terminated employees. Defendants’ own answer to Plaintiff’s
Interrogatory Question Number 25 made the documents of voluntarily terminated former
employees relevant because Defendants alleged, as a defense, that Plaintiff was
voluntarily terminated. Accordingly, Defendants did not have a substantial justification
for objecting to the disclosure of voluntarily terminated employee’s record as Plaintiff’s
are entitled to discover information relevant to any defense asserted by Defendants.
In considering all of Defendants’ objections to Judge Seibert’s award of
reasonable expenses, the Court finds Judge Seibert’s ruling was not clearly erroneous
or contrary to law. Therefore, the Court OVERRULES Defendants’ objection and
AFFIRMS Judge Seibert’s ruling. Plaintiff must file an affidavit regarding any additional
expenses incurred on or before, May 1, 2013. Thereafter, Defendants must file any
28
written objections to Plaintiff’s affidavit within seven days.
V. Conclusion
Accordingly, the Court finds the following:
1. The Court OVERRULES Defendants’ objections to Judge Seibert’s Original
and Amended Order [Doc. 72];
2. The Court AFFIRMS Judge Seibert’s Amended Order [Doc. 65];
3. The Court LIFTS the partial and temporary stay of Magistrate Judge Seibert’s
Original and Amended Orders [Docs. 55 and 71];
4. Plaintiff must file an affidavit of additional, related reasonable expenses
incurred following the issuance of Judge Seibert’s Amended Order by May 3, 2013.
Within seven days thereafter, Defendants must file written objections, if any, to Plaintiff’s
affidavit of reasonable expenses.
It is so ORDERED.
The Clerk is directed to transmit copies of this Order to all counsel of record
and/or any pro se parties herein.
DATED: April 25, 2013
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