American National Property and Casualty Company v. Bunn-O-Matic Corporation

Filing 21

MEMORANDUM OPINION AND ORDER granting in part and denying in part Defendant's 11 MOTION for Sanctions; Defendant shall have 14 days in which to provide the Court with an affidavit itemizing the fees and expenses incurred in preparing the mot ion for sanctions; Plaintiff shall have 14 days thereafter to file a response in opposition to the Defendant's affidavit and argument; granting the parties' oral motion for a continuance of the discovery deadline through and including 4/18/2014. Signed by Magistrate Judge Cheryl A. Eifert on 3/24/2014. (cc: attys; any unrepresented party) (mkw)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF WEST VIRGINIA
HUNTINGTON DIVISION
AMERICAN NATIONAL PROPERTY
AND CASUALTY COMPANY,
as subrogee of Michael Short,
Plaintiff,
v.

Case No.: 3:13-cv-12668

BUNN-O-MATIC CORPORATION,
Defendant.
MEMORANDUM OPINION AND ORDER
Pending before the Court is Defendant’s Motion for Sanctions, (ECF No. 11).
Plaintiff filed a response, (ECF No. 16), and Defendant replied. (ECF No. 19). On March
24, 2014, the undersigned conducted a hearing on the motion at which the parties
appeared by counsel.
Defendant requests an order from the Court pursuant to Federal Rule of Civil
Procedure 37(d) prohibiting Plaintiff from introducing any evidentiary materials at trial
that were not produced prior to January 31, 2014, and for an award of attorney’s fees and
costs incurred as a result of Plaintiff’s failure to properly serve Rule 26 disclosures and
responses to discovery requests. Defendant argues that Plaintiff’s initial disclosures—
which were due on August 19, 2013—were not served until March 20, 2014, and its
responses to Defendant’s discovery requests—which were due on January 31, 2014—were
not served until March 21, 2014. As a result of Plaintiff’s wilful failures to comply with the
Federal Rules of Civil Procedure and the scheduling orders of this Court, Defendant
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claims to have been prejudiced in completing discovery.
In response, Plaintiff admits that it did not comply with the deadline for filing
initial disclosures, and it did not timely respond to written discovery requests. Plaintiff
offers lackluster explanations for its failures, but contends that the case is simple and
argues that it informally provided Defendant with all of the relevant materials months
ago. Plaintiff confirms that it has now supplied the disclosures and discovery responses,
and states that the only new piece of information given to Defendant with the disclosures
and responses was a copy of the applicable insurance policy. Therefore, Plaintiff asserts
that Defendant has not been prejudiced by the delays.
Notwithstanding Plaintiff’s representations, an informal exchange of information
is plainly insufficient to meet a party’s obligations under the federal discovery rules. Here,
Plaintiff did not serve answers to interrogatories and requests for production of
documents until one business day before the hearing on Defendant’s motion for
sanctions, months after the answers were originally due and just two weeks before the
close of discovery. Therefore, Defendant has stated a basis for an award of sanctions
under Federal Rule of Civil Procedure 37(d)(1). Although not directly relevant to a motion
under Rule 37(d)(1), Plaintiff was even more dilatory in serving its Rule 26(a)(1) initial
disclosures, not supplying them until seven (7) months after the deadline ordered by the
Court.
Under Federal Rule of Civil Procedure 37(d)(3), the Court has the option of
awarding any of the sanctions set forth in Rule 37(b)(2)(A)(i)-(vi) and must “require the
party failing to act, the attorney advising that party, or both to pay the reasonable
expenses, including attorney’s fees, caused by the failure, unless the failure was
substantially justified or other circumstances make an award of expenses unjust.” Prior to
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imposing sanctions, the undersigned must consider four factors: (1) whether the
noncomplying party acted in bad faith; (2) the degree of prejudice suffered by the other
party or parties as a result of the failure to comply; (3) the need to deter the particular
sort of noncompliance; and (4) the efficacy of less drastic sanctions. Belk v. CharlotteMecklenburg Bd. of Educ., 269 F.3d 305, 348 (4th Cir. 2001) (en banc), cert. denied, 535
U.S. 986, 122 S.Ct. 1537, 152 L.Ed.2d 465 (2002). Considering the first factor, there does
not appear to be bad faith in this case. Indeed, most of the relevant information
apparently was provided to Defendant without the need for formal discovery requests,
and Plaintiff has previously offered to make the product at issue available for inspection
and its expert available for deposition. In regard to the second factor, Defendant has been
impeded in its ability to complete discovery, but after discussing what tasks remain
undone, the undersigned finds that the prejudice to Defendant can be cured by a short
extension of the discovery deadline. Looking at the third factor, certainly some sanction
should be imposed to deter future noncompliance and similar misbehavior, but the
sanction need not be as drastic as prohibiting the introduction of evidence. Assuming the
veracity of Plaintiff’s statement that it has now produced all of the discoverable
information in its possession, save for the deposition testimony to be obtained by
Defendant, then Plaintiff’s failure to fulfill its discovery obligations can be appropriately
sanctioned by the imposition of reasonable fees and costs incurred by Defendant in
bringing its motion. However, this ruling shall not be interpreted to foreclose Defendant
from bringing a separate motion under Rule 37(c), for example, if it subsequently finds
that Plaintiff has withheld documents or witnesses that should have been disclosed.
Accordingly, the Court ORDERS as follows:

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1.

Defendant’s Motion for Sanctions is GRANTED, in part, and DENIED, in

part. Defendant’s request that Plaintiff be prohibited from introducing any evidentiary
materials at trial that were not produced prior to January 31, 2014 is denied. On the other
hand, Defendant’s motion for an award of attorney’s fees and costs incurred as a result of
Plaintiff’s failure to properly serve Rule 26 disclosures and responses to discovery
requests is granted. Defendant shall have fourteen (14) days in which to provide the
Court with an affidavit itemizing the fees and expenses incurred in preparing the motion
for sanctions, as well as any argument addressing the reasonableness of the requested
award considering the factors contained in Robinson v. Equifax Information Services,
LLC, 560 F.3d 235, 243-44 (4th Cir. 2009). Plaintiff shall have fourteen (14) days
thereafter to file a response in opposition to the Defendant’s affidavit and argument.
2.

Defendant has requested a short extension of time in which to complete

depositions of fact witnesses, as well as of Mr. Casto, Plaintiff’s expert witness. After
conferring with Judge Chambers, the undersigned is authorized to GRANT the parties’
oral motion for a continuance of the discovery deadline through and including April 18,
2014.
The Clerk is instructed to provide a copy of this Order to counsel of record and any
unrepresented party.
ENTERED: March 24, 2014

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