The Union Labor Life Ins. Co. v. J. Brian O’Neill C.A. No. 15-152S U.S. District Court, D. Rhode Island July 17, 2017 Counsel Andrew S. Tugan, David A. Wollin, Hinckley, Allen & Snyder LLP, Providence, RI, for Plaintiff Stephen A. Izzi, Moses & Afonso, Ltd., Providence, RI, James P. Cousounis, Pro Hac Vice, Matthew R. Williams, Pro Hac Vice, Steven Coren, Pro Hac Vice, Kaufman, Coren & Ress, P.C., Philadelphia, PA, for Defendant Sullivan, Patricia A., United States Magistrate Judge Memorandum AND Order *1 Pursuant to Fed. R. Civ. P. 37(a)(3), plaintiff Union Labor Life Insurance Company (“ULLICO”) has moved the Court for an order sanctioning defendant J. Brian O’Neill by precluding him from introducing evidence concerning his defense to ULLICO’s damages claim that it exercised undue delay, acted in bad faith or breached the implied covenant of good faith and fair dealing in not recording the deed to the property at issue until approximately eight months after O’Neill’s breach. ECF No. 44 (“Motion”). This evidence was requested by ULLICO’s damages-phase interrogatories and requests for production to which O’Neill failed to provide responsive information or documents prior to the close of fact discovery on May 15, 2017. Alternatively, ULLICO asks the Court to compel further discovery responses. In addition, pursuant to Fed. R. Civ. P. 36(a)(6) and 37(a)(3), ULLICO moves for an order compelling O’Neill to serve proper responses to ULLICO’s second set of requests for admissions within fourteen days and to overrule his objections thereto. Finally, pursuant to Fed. R. Civ. P. 37(b)(2)(C), ULLICO seeks to recover its attorney’s fees and costs in bringing the Motion. The Motion has been referred to me for determination pursuant to 28 U.S.C. § 636(b)(1)(B). A hearing was held on July 7, 2017. I. Failure to Make Timely Responses to Document Requests and Interrogatories Having previously stayed discovery, on January 3, 2017, this Court granted summary judgment in favor of ULLICO on Counts I and II of its complaint (ECF No. 1), ruling that O’Neill is liable under his Guaranty and Forbearance Agreement to pay certain obligations, leaving only the issue of damages to be determined. ECF No. 38; 2017 WL 24740 (D.R.I. Jan. 3. 2017). On February 22, 2017, the discovery stay was lifted and a scheduling order entered; in so doing, the Court overruled ULLICO’s request for a shorter period, adopted an approach consistent with O’Neill’s proposal and set a deadline of May 15, 2017, as the deadline for the completion of fact discovery for the damages phase. See Tower Ventures, Inc. v. City of Westfield, 296 F.3d 43, 47 (1st Cir. 2002) (“When a litigant seeks an extension of time and proposes a compliance date, the court is entitled to expect that the litigant will meet its self-imposed deadline.”). Soon after, on March 8, 2017, ULLICO propounded its second set of requests for production and interrogatories specifically to address damages, particularly to uncover any facts supporting O’Neill’s purported defenses to ULLICO’s damage claim. This information is pivotal in that O’Neill has argued that ULLICO’s damage claim is seriously overstated because ULLICO’s eight-month delay in recording the subject deed was unreasonable, in bad faith and in breach of the covenant of good faith and fair dealing. Yet, as far as ULLICO was aware, the previously produced discovery establishes only that no contractual language barred such a delay and that O’Neill himself asked for the delay to allow him time to continue to market the property. With this background in mind, ULLICO targeted its damage-phase discovery to elicit the facts, witnesses and documents on which O’Neill would rely in support of his claim that the delay was nevertheless wrongful. *2 Instead of supplying the requested information, O’Neill responded with improper blanket objections, interrogatory responses that were unsigned and no documents at all. Worsening the situation, when asked about his woefully inadequate production, O’Neill provided vague assurances that more would be forthcoming, heading off a prompt motion to compel. Time passed, O’Neill provided nothing more and also took no steps to extend the Court’s scheduling order deadlines. On May 15, 2017, fact discovery closed and, on May 30, 2017, ULLICO’s expert disclosure deadline passed. ULLICO did not take depositions of witnesses who might have facts about the delay because no such witnesses were disclosed. Nor did it designate any experts on the reasonableness of the delay, because no facts have been identified on which an expert opinion might rest. Exacerbating the situation, after this Motion was briefed and awaiting hearing, O’Neill dumped an undifferentiated mass of more than 18,000 documents on ULLICO. Unless the Court intervenes, ULLICO must now incur the expense of plowing through this pile, figure out for itself which documents might pertain to delay, but still be foreclosed from depositions or other follow-up discovery if anything in the pile seems significant. Meanwhile, O’Neill presents no justification for his disregard of the Court’s scheduling order. But neither does ULLICO contend that his conduct is part of a protracted “tale of lack of effort, of bland disobedience of a series of court orders, or of unsavory scheming.” See Gagnon v. Teledyne Princeton, Inc., 437 F.3d 188, 197 (1st Cir. 2006). This state of affairs leaves ULLICO on the horns of a familiar dilemma. Either it proceeds at risk of being blindsided by O’Neill’s ability to spring a trap at summary judgment or trial by presenting a mystery witness who could testify to some as-yet-unknown fact from which a fact finder might conclude that ULLICO’s delay was unreasonable. Or it can ask for more time to pursue the wrongfully-withheld discovery, inflicting serious delay (resulting in real prejudice) on itself, as well as upending the Court’s case management plan for bringing this case to an orderly conclusion. A significant feature of O’Neill’s cavalier approach to compliance with the Court’s scheduling order emerged during the hearing. In response to the Court’s inquiry, O’Neill’s counsel conceded that he is aware of no facts not already provided to ULLICO during liability-phase discovery that support the defense that ULLICO’s delay in recording the deed was wrongful. Put differently, if the Court extended the fact discovery period (which neither party is asking it to do) and ordered O’Neill to provide complete responses, the result would be substantial delay, but not new facts because O’Neill is aware of no new facts. Consistently, also at the hearing, O’Neill’s counsel advised ULLICO and the Court that the 18,000-page document dump produced on the eve of the hearing has no bearing on the issue of ULLICO’s delay in recording the deed. Rather, as far as counsel is aware, these documents are responsive only to a single request about O’Neill’s efforts to market the subject property. The conundrum is what is the proper remedy. For starters, neither party has asked the Court to reopen fact discovery; in any event, if O’Neill made such a request, it would not be lightly granted especially in light of the prejudice more delay would inflict on ULLICO. See Steir v. Girl Scouts of USA, 383 F.3d 7, 12 (1st Cir. 2004) (motion to modify scheduling order brought after close of discovery is prejudicial if it requires reopening of discovery, delay of trial and imposition of additional costs of on nonmoving party). Also pertinent to the appropriate remedy is the complete absence of any justification for providing hopelessly incomplete responses and then producing an undifferentiated document dump after fact discovery had closed. SeeTower Ventures, 296 F.3d at 47 (failure to provide legitimate reason for failure to comply with scheduling order appropriate to consider in forging sanction). Yet punitive sanctions under the Rule on which ULLICO relies, Fed. R. Civ. P. 37(a)(3), appear premature because, while O’Neill may have been lackadaisical about the scheduling order, he has not yet violated a specific order of the Court. Fed. R. Civ. P. 37(b) (sanctions appropriate for failure to comply with order of court compelling discovery). Relatedly, the Rule that ULLICO cites to support its entitlement to recovery of attorney’s fees (Fed. R. Civ. P. 37(b)(2)(C)) is based on disobedience of an order compelling discovery, which has not happened. Neither did O’Neill completely ignore the propounded discovery; he provided responses, albeit inadequate in light of ULLICO’s purpose of discovering whether facts exist to support the bad-faith delay defense. Further, while ULLICO alternatively (and reluctantly) asks for an order compelling compliance pursuant to Fed. R. Civ. P. 37(a)(3), it is clear to the Court that such an order would exacerbate the situation in that it would amount to a de facto extension of fact discovery, causing prejudicial delay and disrupting the Court’s schedule for the case. Similarly, ULLICO’s arguable entitlement to an award of attorney’s fees for the making of this Motion pursuant to Fed. R. Civ. P. 37(a)(5)(A) derives from the granting of a motion to compel; an order compelling compliance solves nothing as it would simply protract the damages phase when the case should be on the brink of final resolution. *3 The Court instead will rely on Fed. R. Civ. P. 16(f)(1) and Fed. R. Civ. P. 37(c)(1). Rule 16(f) supplies the court with substantial authority to “choose from a broad universe of possible sanctions” to enforce its case management orders, Tower Ventures, 296 F.3d at 45-46, while Fed. R. Civ. P. 37(c)(1) supplies the teeth to enforce the “ ‘broadened duty’ to comply with case management orders by the use of preclusion for the failure timely to supplement disclosures and responses” as required by Fed. R. Civ. P. 26(a) or (e)(1). Wilson v. Bradlees of New England, Inc., 250 F.3d 10, 20 (1st Cir. 2001). Rule 37(c)(1) “carries with it the implicit authority of the district court to exclude such materials when not timely produced even if there was no rigid deadline for production.” Macaulay v. Anas, 321 F.3d 45, 51 (1st Cir. 2003). In making the determination whether to impose the sanction of preclusion pursuant to Fed. R. Civ. P. 37(c)(1), the Court should examine the proponent’s need for the challenged evidence, the justification (if any) for the late disclosure, and the opponent’s ability to overcome its adverse effects. Surprise and prejudice are important integers in this calculus, as well the Court’s assessment of what the late disclosure portends for its docket. Id.; see Tower Ventures, 296 F.3d at 45-46 (relying on Fed. R. Civ. P. 16(f), “a litigant who ignores case-management deadlines does so at his peril.”). The choice of an appropriate sanction must be handled on a case-by-case basis. Id. at 46. In imposing a sanction based primarily on case management, the court must focus on the impact of the decision on the scofflaw, to determine whether the “action [was] sufficiently blameworthy to warrant [a sanction] without consideration of harmlessness.” Gagnon, 437 F.3d at 199 (court required to consider “the burden and expense that [the party has] faced and would likely face in dealing with the issue presented by the belated ... disclosure”). Shaped by Macaulay and Tower Ventures, but also by the need to avoid a needlessly harsh sanction as taught by Gagnon, the key to the puzzle lies in O’Neill’s representation at the hearing that he has no new information to provide in support of his delay defense, including that the belatedly-produced document dump is unrelated to that defense. Based on that concession, the Court will impose a preclusion order barring O’Neill from advancing his delay defense either with a stray document hidden among the late-produced 18,000 or with the information or evidence that should have been provided in response to ULLICO’s damages-phase discovery. Such an order inflicts no prejudice on O’Neill who concedes there is nothing there; it solves ULLICO’s problem in that it ends both the risk of ambush and the expense of delay, leaving ULLICO free to move ahead to the final phase of the case; and it serves the Court’s independent interest in the efficient management of its docket. Primus v. United States, 389 F.3d 231, 234 (1st Cir. 2004) (district courts have available range of sanctions for the untimely production of discovery materials to use to “work a complicated equation, balancing fairness to the parties with the need to manage crowded dockets.”); see Santiago-Diaz v. Laboratorio Clinico Y De Referencia Del Este and Sara Lopez, M.D., 456 F.3d 272, 277-78 (1st Cir. 2006) (“[c]ourts are entitled to take sensible measures to guard against such debilitating occurrences” in dealing with party who, without good cause, neglects to comply with reasonable deadlines); Sherwood Brands, Inc. v. Penn. Mfrs. Assn., C.A. No. 08-151ML, 2010 WL 11469874, at *7 (D.R.I. Sept. 30, 2010); Fed. R. Civ. P. 37(b)(2)(A)(ii) (disregard of scheduling order warrants preclusion). Such a preclusion order aptly reflects the principle that sanctions should be tailored to the remedy that is necessary to cure or minimize the prejudice inflicted on the parties, particularly the innocent party. Santiago-Diaz, 456 F.3d at 277. And with such a preclusion order, there is no need for a more punitive sanction like attorney’s fees. Based on the foregoing, the Court orders[1] that O’Neill is precluded, both at the summary judgment stage and trial, from using any of the 18,024 pages of documents (marked as ONEILL 10656-28680), which were produced after the May 15, 2017, fact discovery deadline, in support of his bad faith/delay/breach of the implied covenant of good faith and fair dealing defense. O’Neill may use such documents solely as evidence pertaining to efforts he made to market and sell the subject property, including to rebut any evidence regarding such efforts presented by ULLICO or to impeach any witness who may testify regarding such efforts on ULLICO’s behalf. ULLICO is permitted to use any such documents to support any aspect of its claims or defenses, including to rebut O’Neill’s bad faith/delay/breach of the implied covenant of good faith and fair dealing defense. *4 Further, the Court orders that O’Neill, including any witness who is called to testify or to provide an affidavit on his behalf, is precluded, both at the summary judgment stage and at trial, from offering any affidavits or testimony on the bad faith/delay/breach of the implied covenant of good faith and fair dealing defense, except that O’Neill may present testimony or affidavits regarding such defense if the testimony reflects or is consistent with facts previously disclosed in a discovery response or other information produced by either party prior to May 15, 2017. Nothing in the foregoing precludes ULLICO from asserting on summary judgment or at trial that the bad faith/delay/breach of implied covenant of good faith and fair dealing defense has not been properly pled or that it lacks merit as a matter of fact or law. II. Requests for Admission O’Neill improperly objected to many of the requests for admissions in ULLICO’s second set on grounds that the requests called for legal conclusions and that the referenced documents speak for themselves. Consistent with Magistrate Judge Facciola’s reasoning in Miller v. Holzmann, 240 F.R.D. 1, 4-5 (D.D.C. 2006), these objections are overruled. Similarly, as he conceded at the hearing, O’Neill’s objection to authenticating certain documents because they were produced without metadata[2] was not based on a reasonable belief that the documents are not authentic. To the contrary, he believes these documents to be authentic. Consequently, the objections based on the absence of metadata are also overruled. O’Neill is ordered to provide supplemental responses to all of the requests for admissions in the second set to which these objections were asserted within two weeks of the date of this Memorandum and Order. III. Conclusion ULLICO’s Motion for Discovery Sanctions and to Compel Discovery Responses (ECF No. 44) is hereby granted in part and denied in part as follows. To the extent that the Motion seeks an Order precluding O’Neill from introducing evidence at trial or summary judgment bearing on his bad faith/undue delay/breach of implied covenant of good faith and fair dealing defense, the Motion is granted and O’Neill is precluded as set forth above. To the extent that the Motion seeks an Order requiring O’Neill to supplement his responses to ULLICO’s Second Set of Requests for Admission, the Motion is granted and O’Neill’s supplemental responses must be served within two weeks of this Memorandum and Order. To the extent that the Motion seeks an award of attorney’s fees and costs incurred in bringing the Motion, the Motion is denied. So ordered. Footnotes [1] In keeping with the goal of achieving fairness, the parties were invited to supply proposed language for the preclusion order. Both did and what appears above is based on an amalgamation of their submissions. [2] The subject documents were produced without metadata pursuant to the agreement of the parties at the Fed. R. Civ. P. 26(f) phase of the case. Neither ULLICO nor O’Neill produced documents with metadata.