*1 This matter comes before the undersigned United States Magistrate Judge pursuant to a general assignment made in accordance with the provisions of 28 U.S.C. § 636(b)(1)(A), upon Plaintiffs’ Motion for Discovery Sanctions, [Docket No. 158]. The Court held a Motions Hearing on April 12, 2017, and thereafter the Court took the Motion under advisement.

For the reasons discussed below, the Court GRANTS IN PART AND DENIES IN PART Plaintiffs’ Motion for Discovery Sanctions, [Docket No. 158].

I. Background and Statement of Alleged Facts

Plaintiffs in this case are: (1) trustees of the Operating Engineers Local #49 Health and Welfare Fund (“Health and Welfare Fund”) and the Local #49 International Union of Operating Engineers and Associated General Contractors of Minnesota Apprenticeship and Training Program (“Apprenticeship and Training Program”); (2) a fiduciary of the Central Pension Fund of the International Union of Operating Engineers and Participating Employers (“Central Pension Fund”); (3) the Health and Welfare Fund; (4); the Central Pension Fund; and (5) the Apprenticeship and Training Program. The Health and Welfare Fund, the Central Pension Fund, and the Apprenticeship and Training Program are multi-employer, jointly trusteed employee fringe benefit plans and are collectively referred to as “the Funds,” and the Plaintiffs in their totality are referred to as “Plaintiffs.”

In June 2014, Plaintiffs brought suit in this Court against Defendants Charps Welding & Fabricating, Inc. (“Charps”); Kenneth Charpentier; Clearwater Energy Group, Inc. (“Clearwater”); C&G Construction (“C&G”), and Alpha Oil & Gas Services (“Alpha Oil”) (collectively, “Defendants”), seeking “to collect unpaid fringe benefit contribution payments.” (Compl., [Docket No. 1], 1, 3). Plaintiffs allege that certain collective bargaining agreements (“CBAs”) require Charps to make monthly contributions to the Funds for each hour worked by employees covered by the CBAs. (Id. at 4-5). Plaintiffs further allege that some of the CBAs and other agreements permit the Funds or their authorized agents to examine signatory employers’ payroll and employment records as deemed necessary by the Funds or their authorized Agents in order to ensure proper administration of the Funds, and that Charps and Charpentier are required by the CBAs to furnish, on demand, all necessary employment and payroll records relating to their employees covered by the CBAs. (Id. at 7).

In Count I of their Complaint, Plaintiffs argue that Charps and Charpentier breached the terms of the relevant agreements by refusing to produce requested employment and payroll records for Clearwater, C&G, and Alpha Oil for the period requested (“the Audit Period”). (Id. at 8). Plaintiffs ask the Court to order Defendants to produce the records requested and to enjoin Defendants from further refusal to allow access to the records. (Id. at 9, 14). In Count II, Plaintiffs allege that Clearwater, C&G, and Alpha Oil are alter egos of Charps and/or Charpentier such that Clearwater, C&G, and Alpha Oil are also bound by the CBAs. (Id. at 9-10). In the alternative, in Count III, Plaintiffs argue that all Defendants form a joint venture which results in Clearwater, C&G, and Alpha Oil being bound by the CBAs. (Id. at 11-12). In Count IV, Plaintiffs seek liquidated damages for unpaid contributions under the CBAs and the Employee Retirement Income Security Act of 1974 (“ERISA”), 28 U.S.C. § 1001, et seq. (Id. at 2, 12-13). Defendants filed a Joint Answer on July 17, 2014, generally denying Plaintiffs’ factual allegations and any liability. (Answer, [Docket No. 8] ).

*2 On May 14, 2015, after discovery had begun, this Court issued an Order ruling on a Motion to Compel brought by Plaintiffs.[1] (Order, [Docket No. 31], 1). The Court held that at that prior stage of the proceedings, the scope of discovery was limited to information relevant to Plaintiffs’ threshold claim that they are entitled to conduct the requested audit and Plaintiffs’ claims based on alter ego and joint venture. (Id., at 7-9). In addition, the Court limited the temporal scope of otherwise relevant discovery to 6 years, and it limited the geographic scope of relevant discovery to work performed by Defendants in Minnesota. (Id. at 9-10, 12).

As part of the Order, this Court specifically addressed Plaintiffs’ Interrogatory No. 1, which asked Defendants to:

(Id. at 13). The Court held that Plaintiffs had not shown that the information sought in Interrogatory No. 1 was relevant to Plaintiffs’ right to conduct an audit of Defendants. (Id. at 14-15). Thus, the Court held Defendant Charps to its representation to the Court that it would produce documents responsive to Interrogatory No. 1, but the Court declined to order supplemental responses beyond Defendant Charps’ own concessions. (Id. at 14-15).

In the May 14, 2015, Order, the Court also specifically addressed Plaintiffs’ Interrogatory No. 10, which asked Defendants to: “State whether the Defendants had or have any common or shared employees or leased employees and identify each by name and respective employment dates those common employees transferred between Defendants.” (Id. at 25). The Court found that this information was relevant at that earlier stage to Plaintiffs’ theories of alter ego and joint venture. (Id. at 28).

The Court next specifically addressed Plaintiffs’ Document Request Nos. 4 and 5, which sought data exports of Defendants’ “job cost detail” and “job estimates” from January 1, 2008, through the present or, if Defendants did not maintain such information in electronic format, “the functional documentary equivalent.” (Id. at 36). The Court held that such information “is relevant to the factor of sufficient capitalization for corporate undertakings and, as such, to the threshold liability issue of breach of contract through alter ego and joint venture.” (Id. at 37). Similarly, the Court addressed Plaintiffs’ Document Request 34, which sought: “Any and all documents relating to or referring to communications made between Defendants, including, but not limited to correspondence, notes and memoranda from January 1, 2008 to the present.” (Id. at 39). Regarding Plaintiffs’ Document Request 34, the Court ordered Defendants “to produce responsive communication documents containing information relevant to the theories of alter ego and joint venture.” (Id. at 41).

Plaintiffs filed Objections to this Court's May 14, 2015, Order, but the District Court overruled the Objections on July 8, 2015. (Objections, [Docket No. 33]; Order, [Docket No. 35] ).

On June 26, 2015, Charps and Alpha Oil served Second Supplemental Answers to Plaintiffs’ Interrogatories. (Lawrie Aff., Exh. B, [Docket No. 164-2], 2, 24-25, 31). In response to Plaintiffs’ Interrogatory No. 1 (which asked for identification of and employment information related to all of Defendants’ employees), Charps stated:

(Lawrie Aff., Exh. B, [Docket No. 164-2], 3-4).

In response to Plaintiffs’ Interrogatory No. 10 (which specifically asked about shared/leased employees), Defendants provided the following Supplemental Answer:

(Id. at 6, 27-28). Attached to the Second Supplemental Answers to Plaintiffs’ Interrogatories was a list entitled “Charps Welding & Fabricating, Inc. Employee Contact List,” ( [Docket No. 164-2], 32-53), and a list entitled “Charp's Welding & Fabricating Detail Employee Listing Sorted by Employee Alpha Code,” ( [Docket No. 164-2], 54-112 and [Docket No. 164-3], 1-121). These lists appear to identify Charps’ employees.

On July 27, 2015, Defendants served their Third Supplemental Answers to Plaintiffs’ Interrogatories. (Lawrie Aff., Exh. C, [Docket No. 164-4], 2, 6-7, 11-12, 16-17, 21). Regarding Interrogatory No. 10, each Defendant responded:

(Id. at 3, 8, 13, 18). The Third Supplemental Answers did not include supplemental answers to Plaintiffs’ Interrogatory No. 1. Attached to the Third Supplemental Answers was a list identifying 18 individuals who had worked for more than one Defendant entity during the time period of May 2008 through July 2015.[2] (Id. at 22).

In January and March, 2016, Plaintiffs and Defendants filed cross-Motions for Summary Judgment,[3] and the District Court held a hearing on the Motions on May 26, 2016. ( [Docket No. 57, 63, 104] ). On June 27, 2016, the District Court issued an order denying both Motions and removing the prior limitations restricting discovery to information relevant to joint venture and/or alter ego. (Order, [Docket No. 107], 3-4). As a result, on July 6, 2016, this Court issued a Second Amended Scheduling Order, setting the deadline for completion of all discovery as of March 1, 2017. (Sec. Amend. Sched. Order, [Docket No. 108], 2).

On October 13, 2016, Defendants served their Fourth Supplemental Answers to Plaintiffs’ Interrogatories. (Lawrie Aff., Exh. D, [Docket No. 164-4], 24, 33). As to Interrogatory No. 1 (which requested identification of and employment information related to all Defendants’ employees), Defendants provided the following supplemental response:

*5 (Id. at 25-26). Attached to the Responses were (1) a C&G “New Hire List,” ( [Docket No. 164-4], 34-42); (2) a list of what appears to be C&G employees and their hire dates, (Id. at 43-50); (3) an Alpha Oil “New Hire List,” (Id.at 51-75); (4) a list of what appears to be Alpha Oil employees and their hire dates, (Id. at 76-83); (5) a Clearwater “New Hire List,” (Id. at 84); and (6) a list of what appears to be Clearwater employees and their hire dates, (Id. at 85). Also attached was a separate list identifying approximately 189 “individuals [who] have had a term of service for more than one Defendant entity.” (Id. at 86-89).

On November 30, 2016, Plaintiffs served their Third Set of Requests for Production of Documents, including Plaintiffs’ Document Request No. 163, which sought: “Any and all employee files for any employee who was employed by you during the period of January 1, 2008 through the present.” (Lawrie Aff., Exh. E, [Docket No. 127-1], 45, 51-52). Defendants responded to Plaintiffs’ Third Set of Requests for Production of Documents on December 30, 2016. (Id. at Exh. I, [Docket No. 127-1], 78).

On February 1, 2017, the parties filed multiple motions, including Plaintiffs’ Motion to Compel Discovery Responses, which in relevant part generically asked this Court to: order Defendants to fully respond to all of Plaintiffs’ Interrogatories and Document Requests and supplement any previous responses within 10 days of the Court's order. (Motion to Compel, [Docket No. 122], 2). For their part, Defendants filed a Motion for Protective Order, [Docket No. 123], asking the Court to hold that Defendants do not have to produce further ESI to Plaintiffs. (Id. at 2).

On February 9, 2017, Defendants produced to Plaintiffs three boxes of documents that had been considered in connection with Defendants’ expert report. (Chase Dec., [Docket No. 176], 2).

This Court held a Motions Hearing on all of the pending discovery Motions on February 15, 2017. (Order, [Docket No. 149], 1). At that Motions Hearing, as relevant to the Motion currently before this Court, “Plaintiffs stated on the record at the Motions Hearing that all paper documents have been produced and that Plaintiffs are no longer moving to compel production of additional paper documents.” (Id. at 45).

Defendants now assert that after the Motions Hearing, they reviewed their production of documents to date and discovered additional documents that had not yet been produced—further documents which had been considered in connection with Defendants’ expert report, as well as three boxes of employee files that had been “inadvertently excluded from the December 30, 2016” document production. (Chase Dec., [Docket No. 176], 2-3). Thus, on Friday, February 17, 2017, Defendants’ counsel's legal assistant emailed Plaintiffs’ counsel and informed her that Defense counsel had uploaded additional supplemental discovery documents to the electronic portal and that there were “4 additional banker's boxes available in [Defense counsel's] office for inspection and/or copying.” (Lawrie Aff., Exh. E, [Docket No. 164-4], 91).

On Sunday, February 19, 2017, Plaintiffs’ counsel replied by email, asserting that Plaintiffs would pick up the documents the following morning and further stating that due to the document production, Plaintiffs intended to postpone the seven depositions scheduled for the following week until Plaintiffs had reviewed the documents and obtained certification from Defendants that all responsive paper documents had been produced. In addition, Plaintiffs indicated that they intended to contact the Court to request a telephone conference. (Id., Exh. F, [Docket No. 164-4], 93). Defendants’ counsel responded by email the same day and asserted that there was no need to cancel the upcoming depositions, for which some deponents had already arrived by plane, because Plaintiffs had been “in possession and aware of the four bankers boxes before the hearing last week” and the documents contained therein “relate to the expert report, an expert [Plaintiffs] have chosen not to depose.” (Id.).

*6 Plaintiffs retrieved the boxes of documents from Defense counsel's office on Monday, February 20, 2017. (Chase Dec., [Docket No. 176], 3). Plaintiffs contend that the boxes contained previously unproduced employee files for approximately 1,322 employees. (Lawrie Aff., [Docket No. 164], 4; Id. at Exh. N, [Docket No. 164-5], 13-41).

On Tuesday, February 21, 2017, Plaintiffs’ counsel emailed Defendants’ counsel and asked for written certification that Defendants “have provided all paper documents that they believe are responsive to Plaintiffs’ outstanding discovery requests and Rule 26” or, in the alternative, an inventory and estimate of the volume of documents remaining to be produced, along with an anticipated date of production. (Id. at Exh. G, [Docket No. 164-4], 96). Plaintiffs also asked Defendants to explain: their representation to the Court at the Motions Hearing that all responsive paper documents had been produced,[4] their assertion that Plaintiffs had possession of the most recently produced boxes of documents prior to the Motions Hearing, and their assertion that those documents relate to the expert report. (Id.).

At this point, Defendants’ counsel realized that his previous statement regarding Plaintiffs’ prior possession of the documents was incorrect. Therefore, on February 22, 2017, Defense counsel emailed Plaintiffs’ counsel and acknowledged as much. (Id. at Exh. H, [Docket No. 164-4], 100). He stated that he had erroneously believed Plaintiffs’ reference to boxes of documents in the February 19, 2017, email was referring to the boxes of documents produced on February 9, 2017. (Id. at 101) Defense counsel also asserted that only 3 of the 4 bankers boxes retrieved by Plaintiffs on February 20, 2017, contained additional documents; one of the boxes contained only documents that also had been produced to Plaintiffs in an earlier production. (Id.). Defense counsel further stated that the previously undisclosed documents were being produced at this time because they had been inadvertently overlooked during the previous production. (Id. at 100-01). Defense counsel asserted:

(Id.).

Plaintiffs’ counsel replied by email the same day, contending that the production showed the falsity of (1) Defendants’ statement in its Memorandum in Opposition to Plaintiffs’ Motion to Compel that Defendants had provided a complete inventory of all responsive documents other than a handful of boxes located in Pennsylvania; (2) Defendants’ statement therein that they had met their discovery obligations; and (3) Defendants’ “statement” at the February 15, 2017, Motions Hearing that all paper documents had been produced. (Id. at 100). Plaintiffs demanded that Defendants contact the Court to correct the record. (Id.).

*7 In an email the same day, Defendants declined to do so. (Id. at 99). Defendants’ counsel asserted that the bulk of the information contained in the Alpha Oil employee files retrieved by Plaintiffs on February 20, 2017, was “information already available to” Plaintiffs, as it consisted mostly of copies of paystubs and “the amounts of those payments and identity of those employees is contained in the payroll registers and general ledgers already produced.” (Id.). Plaintiffs’ counsel responded by email, referring Defendants’ counsel to the Minnesota Rules of Professional Conduct and asserting that Defense counsel had a duty to correct the misrepresentations to the Court. (Id. at 98). In addition, Plaintiffs’ counsel asserted that very few of the Alpha Oil employee files contained pay stubs; instead, Plaintiffs’ counsel claimed that the files contained:

(Id. at 98-99). In response by email, Defendants’ counsel stated that he had not made any false statement of material fact to the Court. (Id. at 98).

While reviewing the employee files retrieved on February 20, 2017, Plaintiffs’ counsel came to believe that the documents “identified, for the first time, ... the use of the payroll and job-costing program ‘Foundation.’ ” (Mem. in Supp., [Docket No. 160], 11). Plaintiffs’ counsel also saw a notation which she believed “indicat[ed] the inputting of human resources information into ‘ShareFile.’ ”[5] (See, Lawrie Aff., [Docket No. 164], 4). Plaintiffs’ counsel's independent research revealed that “ShareFile” is the name of a Microsoft program that provides “ ‘a secure file sharing, file transfer, sync, and storage solution’ that enables users to ‘access and manage’ shared data.” (Mem. in Supp., [Docket No. 160], 11, 17). Without any confirmation from Defendants, Plaintiffs’ counsel concluded that the recently produced employee files “established that Defendants used [the Microsoft program] ShareFile, at minimum, to share employee-related information and documents.” (Id. at 17).

Therefore, on February 23, 2017, Plaintiffs’ counsel emailed Defendants’ counsel asking that Defendants: (1) state when Defense counsel had received the employee files produced to Plaintiffs on Monday, February 20, 2017; (2) state when Defense counsel first became aware of a “share file” as referenced in those employee files, which Plaintiffs assert contains additional unproduced information responsive to Document Request No. 34 and which should have been produced after the Court's May 14, 2015, Order; (3) identify the volume and type of documents “stored on that sharefile” and explain why such documents had not been produced; (4) “identify what the ‘Foundation’ computer program is, the information contained in that system, and why that has not been identified”; and (4) explain why Plaintiffs should not immediately seek sanctions against Defendants. (Id. at Exh. I, [Docket No. 164-4], 105-06).

Defendants’ counsel responded by email, asking whether Plaintiffs had copied the documents produced on February 20, 2017, and when Defendants could retrieve the originals, after which Defense counsel would address Plaintiffs’ counsel's substantive questions. (Id. at 104-05). Plaintiffs’ counsel responded that she did not believe review of the contents of the boxes was necessary to answer her substantive questions, and she asked Defendants’ counsel whether he had made his prior representations about the content of those documents without having reviewed the documents. (Id.).

*8 On Tuesday, February 28, 2017, after reviewing the employee files in question, Defense counsel informed Plaintiffs’ counsel by email that Defense counsel had received the employee files retrieved by Plaintiffs on February 20, 2017, in “approximately June 2015” and those files had not been produced earlier because Plaintiffs did not request employee files until their Third Set of Document Requests on November 30, 2016, and they had been inadvertently overlooked during the December 2016 production. (Id. at Exh. J, [Docket No. 164-4], 108). (Id.). Defendants’ counsel also again reasserted his position that “these boxes contain no new information,” that “the bulk of these documents ... contain[s] information already available to you,” and that “many of the documents from these boxes of Alpha employee files are nothing more than duplicate copies of documents previously produced and made available to you in September 2016.” (Id.).

Regarding the “share file,” Defense counsel stated: “Neither I nor my clients are aware of a ‘share file’ you are referring to in your email.” (Id.). As to the computer program “Foundation,” Defense counsel stated:

(Id.). Finally, Defense counsel informed Plaintiffs’ counsel that he was “producing several more documents to you today via our document portal”; although Defense counsel doubted that the documents were responsive to any of Plaintiffs’ discovery requests, Defendants were producing them “out of an abundance of caution.” (Id.). Plaintiffs assert that Defendants then “produced an additional 831 pages of responsive documents.” (Lawrie Aff., [Docket No. 164], 3).

Plaintiffs’ counsel emailed Defense counsel on March 2, 2017, arguing that the employee files were in fact responsive to discovery requests made prior to November 2016. (Id. at Exh. K, [Docket No. 164-4], 111). Plaintiffs’ counsel also asserted that the employee files “identify numerous additional employees and the type of work they performed, and employees that were common to more than one Defendant entity, which your client misrepresented to the Court in earlier sworn testimony.” (Id.). Plaintiffs’ counsel further explained her references to “share file” and Foundation and asked Defendants to “produce a copy of the entirety of both the Foundation program and the Sharefile that is referenced in its documents, the remainder of the employee files that have not been produced to date, and [Defendants’ proposal] for a discovery extension given all of the belated productions.” (Id.). In addition, “given all of the misrepresentations, we request that your clients make their [entire] computer system available for forensic imaging, so that the Trustees can insure complete disclosures.” (Id.).

On March 3, 2017, this Court issued its Order on the February 1, 2017, discovery Motions. (Order, [Docket No. 149] ). As relevant to the issues in the present Motion for Discovery Sanctions, this Court ordered that for purposes of “Defendants’ obligations to supplement under Rule 26(e), the Audit Period shall end as of the end of the discovery period [March 1, 2017].” (Id. at 45). The Court also concluded that “Plaintiffs had ample opportunity to cooperate with Defendants to determine [ESI] search terms and instead informed Defendants to use search terms Defendants found reasonable and produce the resulting ESI.” (Id. at 35). Therefore, “[n]o further ESI production by Defendants is required.” (Id. at 36). Consequently, because Defendants had asserted to this Court that Defendants’ only remaining objection to Plaintiffs’ Interrogatory No. 10 was in relation to ESI, the Court denied Plaintiffs’ Motion to Compel additional responses to Interrogatory No. 10. (Id. at 47).

*9 With regards to Plaintiffs’ Interrogatory No. 1, however, the Court noted that some supplemental production might be required because of the Court's ruling defining the Audit Period. (Id. at 47-48). Therefore, the Court ordered Defendants “to supplement their production of any documents responsive to [this] Interrogator[y] from within the Audit Period as now defined in this Order or inform Plaintiffs by March 21, 2017, that no such additional documents exist.” (Id. at 48).

On March 14, 2017, Plaintiffs filed the present Motion for Discovery Sanctions. (Motion, [Docket No. 158] ). Plaintiffs allege four grounds for discovery sanctions: (1) Defendants failed to comply with this Court's May 14, 2015, Order mandating the production of documents by failing to provide sufficient information regarding the Foundation program and information about the “shared file”; (2) Defendants provided false answers to Interrogatory Nos. 1 and 10; (3) Defendants made false representations to the Court and failed to correct misrepresentations Plaintiffs inadvertently made to the Court; and (4) Defendants generally failed to comply with the requirements of Rule 26. (Mem. in Supp., [Docket No. 160], 27-43). As a sanction, Plaintiffs seek partial summary judgment in their favor on the alter ego issue or, in the alternative, a complete forensic copy of Defendants’ entire computer system. (Id. at 43-44). The Motion also asks this Court to reconsider its March 6, 2017, Order.[6] (Id. at 43).

On March 15, 2017, Plaintiffs filed a letter with District Court Judge Richard H. Kyle, asking for an extension of the deadline by which Plaintiffs were required to file any objections to this Court's March 3, 2017, Order.[7] ( [Docket No. 166] ). Plaintiffs based this request on the pendency of their present Motion for Discovery Sanctions and its included request for reconsideration of this Court's March 3, 2017, Order. (Id.). Defendants filed a letter in response, noting that Plaintiffs’ attack on the March 3, 2017, Order is procedurally improper. (Letter, [Docket No. 167] ). On March 17, 2017, Judge Kyle granted Plaintiffs’ request, ordering that any objections to the March 3, 2017, Order by this Court must be filed within 14 days of the Court's Order on the present Motion for Discovery Sanctions. (Order, [Docket No. 168] ).

On March 20, 2017, pursuant to this Court's March 3, 2017, Order, Defendants served upon Plaintiffs their Supplemental Interrogatory Responses. (Kappenman Dec., Exh. 31, [Docket No. 175-1], 104-119). As relevant here, Defendants supplemented their response to Plaintiffs’ Interrogatory No. 1 as follows:

(Id. at 106).

Defendants supplemented their response to Plaintiffs’ Interrogatory No. 10 as well:

(Id. at 107-08).

Also on March 20, 2017, Defendants informed Plaintiffs that 21 additional boxes of responsive documents were available for pick-up in Defense counsel's office; approximately 75 additional boxes of responsive documents were available for pick-up in Clearbrook, Minnesota; approximately 31 additional boxes of responsive documents were available for pick-up in Watford City, North Dakota; approximately 21 additional boxes of responsive documents were available for pick-up in Williston, North Dakota; and an additional production of emails would be produced directly from Ricoh the following day. (Kappenman Dec., Exh. 30, [Docket No. 175-1], 102-03). Defendants asserted that “the bulk of the supplementation relates directly to the newly defined Audit Period for discovery purposes, [but] in the course of assembling those documents we encountered some additional documents from the earlier period and those are being produced as well, consistent with our obligations under Rule 26.” (Id. at 103).

On March 21, 2017, Defendants filed a Memorandum in Opposition to Plaintiffs’ Motion for Discovery Sanctions. (Mem. in Opp., [Docket No. 174] ). This Court's preliminary review of the written submissions revealed that it appeared that no meaningful meet-and-confers had occurred with regards to the issues in the Motion for Discovery Sanctions, so this Court ordered the parties to conduct direct telephonic or in-person meet-and-confers regarding the issues in the present Motion. (Order, [Docket No. 179] ). The Court further ordered the parties:

(Id. at 2).

On April 4, 2017, the Parties filed a Joint Letter, which stated that they had met and conferred in person and had narrowed the scope of the first alleged basis for discovery sanctions, but that otherwise “[t]he remaining issues in the Trustees’ Motion for Discovery Sanctions remain unchanged.” (Joint Letter, [Docket No. 193], 2). Plaintiffs have not filed an Amended Meet and Confer Statement.

On April 12, 2017, this Court held a Motion Hearing to consider the present Motion for Discovery Sanctions, after which the Court took the matter under advisement. (Minute Entry, [Docket No. 208] ).

II. Standards of Review

Federal Rule of Civil Procedure 26(g)(1) requires that every disclosure made under Rule 26(a)(1) or (a)(3) must be signed by at least one attorney of record or by a pro se party and that such signature certifies that “to the best of the person's knowledge, information, and belief formed after a reasonable inquiry: (A) with respect to a disclosure, it is complete and correct as of the time it is made.” Rule 26(g)(3) provides: “If a certification violates this rule without substantial justification, the court, on motion or on its own, must impose an appropriate sanction on the signer, the party on whose behalf the signer was acting, or both.” (Emphasis added).

*11 Federal Rule of Civil Procedure 37(b)(2) provides:

In addition, Rule 37(c)(1) addresses the consequences when a party fails to provide information as required by Rule 26(a) or (e), and states:

However, “[i]n order to impose sanctions under Rule 37, there must be an order compelling discovery, a willful violation of that order, and prejudice to the other party.” Chrysler Corp. v. Carey, 186 F.3d 1016, 1019 (8th Cir. 1999). In addition:

Card Tech. Corp. v. DataCard Inc., 249 F.R.D. 567, 571 (D. Minn. 2008).

Finally, district courts also have inherent authority to impose sanctions for conduct which abuses the judicial process. Wolfchild v. Redwood Cty., 824 F.3d 761, 770 n.5 (8th Cir. 2016).

III. Plaintiffs’ Motion for Discovery Sanctions, [Docket No. 158]

*12 Plaintiffs assert four grounds for discovery sanctions: (1) Plaintiffs claim that Defendants failed to comply with this Court's May 14, 2015, Order mandating the production of documents by failing to provide sufficient information regarding the Foundation program and information about the “shared file”; (2) Plaintiffs claim that Defendants provided false answers to Interrogatory Nos. 1 and 10; (3) Plaintiffs claim that Defendants made and failed to correct misrepresentations Plaintiffs inadvertently made to the Court at the February 15, 2017, hearing; and (4) Plaintiffs claim that Defendants generally failed to comply with the requirements of Rule 26. (Mem. in Supp., [Docket No. 160], 27-43). Defendants contend that Plaintiffs’ asserted grounds for sanctions are unavailing and ask this Court to deny the Motion in its entirety.[8] (Mem. in Opp., [Docket No. 174], 2).

1. Alleged Violation of this Court's May 14, 2015, Order (by Defendants’ failure to produce Foundation and ShareFile information)

i. Foundation

Plaintiffs assert that they only learned of Alpha Oil's use of what Plaintiffs call “the job costing program” Foundation through reviewing the Alpha Oil employee files retrieved on February 20, 2017, and that Defendants have refused to provide “any of the improperly withheld documents in Foundation.” (Mem. in Supp., [Docket No. 160], 27-28). Plaintiffs further argue that this establishes Defendants’ failure (1) to comply with the Court's May 14, 2015, Order that Defendants provide all job cost and job detail information in response to Plaintiffs’ Document Request Nos. 4 and 5; and (2) to respond to Plaintiffs’ discovery requests in a complete and accurate fashion. Plaintiffs argue that these failures warrant sanctions by this Court. (Id. at 28-29, 32).

In their Memorandum in Opposition to Plaintiffs’ Motion, Defendants explain that Alpha Oil used Foundation to administer payroll from approximately December 1, 2012, to June 28, 2013—the period after Alpha Oil outgrew QuickBooks’ capacity to process payroll but before Alpha Oil switched to using Spectrum to administer payroll. ( [Docket No. 174], 14). Alpha Oil is the only Defendant company that used Foundation and it used Foundation exclusively to administer employee payroll. (Id.). Alpha Oil's payroll information from Foundation was ported into either QuickBooks or Spectrum and was produced to Plaintiffs as part of Alpha Oil's general ledgers. (Id.).

In support of these statements, Defendants have filed with the Court a Declaration from Sandy Gray, payroll administrator for Alpha Oil during the time it used Foundation, which supports the above assertions. (Gray Dec., [Docket No. 177] ). In addition, attached to Gray's Declaration are examples of the payroll information produced to Plaintiffs by Defendants in response to Plaintiffs’ discovery requests (specifically Document Request No. 3, which requested production of payroll registers). (Gray Dec., Exhs. 1-3, [Docket No. 177-1], 1-65). Exhibit 2 is a copy of Alpha Oil's payroll register for the week beginning June 1, 2013; Defendants assert that it was exported directly from Foundation and produced to Plaintiffs on October 28, 2016, at Bates number D 063078. (Gray Dec., [Docket No. 177], 2-3; Id. at Exh. 2, [Docket No. 177-1], 19-26). In their Memorandum in Opposition, Defendants contend that, as shown in Exhibit 2, for the timeframe when Alpha Oil used Foundation, it has produced to Plaintiffs its payroll registers “directly from Foundation.” (Mem. in Opp., [Docket No. 174], 14).

*13 The parties now agree that following an in-person meet-and-confer on March 29, 2017,[9] Defendants produced an additional cost detail report from the Foundation program, which linked the Foundation payroll information to specific jobs and satisfied Plaintiffs’ request in their Motion for Discovery Sanctions for additional information from Foundation. (See, Joint Letter, [Docket No. 183], 1-2; April 12, 2017, Motions Hearing, Digital Record, 1:00-04). Nevertheless, Plaintiffs still request sanctions for the failure to previously produce this information. (Joint Letter, [Docket No. 183], 1). Defendants ask the Court to deny this request. (Id.).

As set forth above, in order for the Court to “impose sanctions under Rule 37, there must be an order compelling discovery, a willful violation of that order, and prejudice to the other party.” See, Chrysler Corp., 186 F.3d at 1019.

Defendants stated on the record at the April 12, 2017, Motions Hearing that following the March 2017 meet-and-confer, Defendants produced additional information from Foundation that provided job-costing information tying the payroll information already produced to specific jobs. (April 12, 2017, Motions Hearing, Digital Record, 1:00-04). However, even assuming for the sake of argument Plaintiffs’ current assertion that this information linking the payroll information to specific jobs was responsive to Plaintiffs’ Document Request Nos. 4 and 5, it is unclear what, if any, prejudice Plaintiffs suffered from the belated production. Defendants contend that they produced all of the payroll information in Foundation to Plaintiffs on September 16, 2016, as part of Alpha Oil's general ledgers and Defendants state that they also produced the Foundation payroll information previously in response to Plaintiffs’ Document Request No. 3, which sought production of payroll registers. (Mem. in Opp., [Docket No. 174], 14-15).

Accordingly, because it does not appear that Plaintiffs were prejudiced by Defendants’ previous production which did not explicitly identify Foundation in response to Plaintiff's Document Request Nos. 4 and 5, and Defendants’ supplemental identification of the job-cost and job-detail information contained therein, this Court is not persuaded that sanctions are merited on this ground.

In addition, even assuming for the sake of argument that the Court agreed that sanctions were warranted by Defendants’ disclosures involving Foundation, the sanction specifically requested by Plaintiffs is not appropriate. Plaintiffs request production of “a complete data backup file of the Foundations [sic] program.” (See, Joint Letter, [Docket No. 183], 1). As Plaintiffs’ counsel agreed on the record at the April 12, 2017, Motions Hearing, Plaintiffs seek this data backup file simply because they do not trust Defendants’ assertions that Defendants have now produced all the responsive data from within Foundation and they essentially want to see for themselves. (April 12, 2017, Motions Hearing, Digital Record, 1:19-21). It is appropriate to deny a motion to compel evidence which is the object of speculation. See, gen., Struzyk v. Prudential Inc. Co. of Am., No. 99-cv-1736 (JRT/FLN), 2003 WL 21302966, *3 (D. Minn. May 16, 2003).

In addition, in its March 3, 2017, Order, this Court addressed ESI production in detail and concluded that “Defendants have fulfilled their discovery obligations with regard to the ESI in this case.” (Order, [Docket No. 149], 34). In part, this Court declined to order Defendants to further produce ESI because ordering “further production of ESI would be unreasonable and unduly burdensome, especially considering Plaintiffs’ admission ... that Plaintiffs have no strategy of how to sort, review, or otherwise use the ESI if it is produced in full as originally requested.” (Id. at 35). The Court has already denied Plaintiffs’ request for continued and unlimited ESI production. (See, Order, [Docket No. 149], 34). It similarly denies Plaintiffs’ request for a complete data file of the Foundation program.

*14 Accordingly, this Court denies Plaintiffs’ Motion for Discovery Sanctions, [Docket No.158], to the extent that it requests sanctions based on an allegation that Defendants’ failure to earlier produce information from the Foundation program violated this Court's May 14, 2015, Order.

ii. ShareFile

Plaintiffs similarly contend that they only learned of Defendants’ ShareFile program “facilitating the exchange of information and documents between Defendants, including human resources documents” through the February 2017 document production, despite this Court's May 14, 2015, Order that Defendants comply with Plaintiffs’ Document Request No. 34 and produce all communication documents containing information relevant to the theories of alter ego and joint venture. (Mem. in Supp., [Docket No. 160], 27-28). Plaintiffs again maintain that Defendants’ refusal to provide any of the improperly withheld documents maintained in ShareFile or to even acknowledge the use of ShareFile merits sanctions. (Id. at 28).

In their Memorandum in Opposition to the Motion for Sanctions, Defendants simply state that they “have not used ShareFile and are not going to guess as to what the handwritten note on that particular W-4 is referring.” (Mem. in Opp., [Docket No. 174], 14).

After the subsequent, Court-ordered, March 2017 meet-and-confer, Plaintiffs provided Defendants with additional “documents specifically referencing the shared file,” which helped Defendants better understand the reference to the shared file. (See, Joint Letter, [Docket No. 183], 1-2). Defendants now assert:

(Id. at 2).

In its May 14, 2015, Order, this Court ordered Defendants “to produce responsive communication documents containing information relevant to the theories of alter ego and joint venture.” (Order, [Docket No. 31], 41). This Court is unpersuaded by Plaintiffs’ attempt to characterize an electronic desktop folder shared by various offices entirely within only Defendant Alpha Oil's administrative structure as a “communication document containing information relevant to the theories of alter ego and joint venture.”

In addition, because the information in the shared file was part of the general ESI addressed in this Court's March 3, 2017, Order ruling that Defendants were not required to produce any further ESI, Defendants ask this Court to deny Plaintiffs’ request that Defendants be sanctioned for failure to produce this ESI. (Id.). Plaintiffs respond that Defendants’ argument is invalid because the Court's Order “predated the Trustees’ knowledge of Defendants’ use of a shared file.” (Id. at 1).

It is unclear to this Court what relevance the timing of Plaintiffs’ knowledge of the shared file has to the issue at hand. Had Plaintiffs timely cooperated with Defendants and utilized search terms during the discovery process to search the available ESI, Plaintiffs could have discovered the shared file and its contents. This Court has already held that Plaintiffs had ample opportunity to do so and thus, in its March 3, 2017, Order, this Court ruled that Defendants need not produce any additional ESI. The Court sees no reason to further reconsider or alter its analysis and conclusion on this subject. (See, Order, [Docket No. 149], 32-36).

*15 Finally, even assuming solely for the sake of argument that Defendants’ failure to identify the shared folder pursuant to the Court's May 14, 2015, Order, the Court again finds that Plaintiffs suffered no prejudice from such failure. Plaintiffs only generically assert that “[t]here is substantial prejudice and surprise by the late production,” but they do not elaborate further. (See, Mem. in Supp., [Docket No. 160], 32). The Court finds nothing in the record to support Plaintiffs’ assertion that the late discovery of a shared electronic desktop folder rather than a system-wide ShareFile commercially available software program as Plaintiff first alleged has prejudiced Plaintiffs.

Accordingly, this Court denies Plaintiffs’ Motion for Discovery Sanctions, [Docket No.158], to the extent that it requests sanctions based on an allegation that Defendants’ failure to earlier identify and produce information from a single shared folder violated this Court's May 14, 2015, Order.

2. Answers to Interrogatory Nos. 1 and 10

Next, Plaintiffs contend that their receipt of employee files from Defendants since February 2017 has revealed additional employees who were not previously identified in response to Plaintiffs’ Interrogatory Nos. 1 and 10. Plaintiffs argue that this shows Defendants’ lack of diligence in ensuring the correctness and completeness of their answers to Interrogatories. (Mem. in Supp., [Docket No. 160], 35-37). Accordingly, Plaintiffs assert that Defendants’ previous responses to Interrogatory Nos. 1 and 10, which did not completely identify all employees or all shared/lease employees, were false and merit sanctions by the Court. (Id. at 37).

More specifically, by comparing the Alpha Oil employee files Plaintiffs retrieved from Defendants on February 20, 2017, Plaintiffs assert that they have have identified 62 employees who were or are “also employed by another Defendant company” but who were not previously identified by Defendants in response to Interrogatory No. 1 (the request for employee lists) or Interrogatory No. 10 (the request for shared/leased employees). (Lawrie Aff., [Docket No. 164], 4-5; Id. at Exh. O, [Docket No. 164-5], 42-44). Plaintiffs also claim that there are at least 79 Alpha Oil employees whom Defendants have identified but for whom Defendants have not produced employee files, and that Defendants have “just now” produced employee files for 273 previously undisclosed Alpha Oil employees. (Mem. in Supp., [Docket No. 160], 17).

Defendants reply that there are a number of reasonable explanations why individuals were not identified as employees in earlier responses to the Interrogatories but were identified in later responses or for whom employee files were later produced. First, Defendants contend that an employee file may have been created for an individual who never actually commenced work because, for example, he or she failed to complete the initially required employment paperwork, such as an I-9 form. (Mem. in Opp., [Docket No. 174], 12). Second, Defendants note that prior to Judge Kyle's June 27, 2016, Order, the scope of discovery in the case was limited by this Court's Order.[10] (Mem. in Opp., [Docket No. 174], 29-30). Therefore, the responses to Plaintiffs’ Interrogatory Nos. 1 and 10 Defendants made prior to June 2016[11] were limited to “work performed by the Defendants in Minnesota.” (Id. at 30; Order, [Docket No. 31], 12). After Judge Kyle's Order in June 2016, the geographic scope of allowed discovery expanded; it is only logical that employee lists produced after that time[12] would include employees not previously included.

*16 In addition, Defendants argue that Plaintiffs have not shown that their asserted “additional employees not previously disclosed” were actually employees who were paid for work done. Prior to bringing the present Motion for Discovery Sanctions, Plaintiffs apparently did not compare their list of asserted additional, previously undisclosed employees to the payroll information or the W-2s disclosed by Defendants to determine whether those individuals were ever actually paid for work or whether employee files had been created in their names yet they had never begun employment. (Id. at 26-28).

At the April 12, 2017, Motions Hearing, Defendants also argued additional potential reasons for employee files existing which might not match lists of individuals actually employed: (1) misspellings on either the employee list or the employee file, (2) the use of nicknames on either the employee list or the employee file, or (3) differences in the names used on an employee list and an employee file related to the conventions applicable to Hispanic surnames. (April 12, 2017, Motions Hearing, Digital Record, 12:5759).

Defendants’ point is well-taken.

The production of employee files for employees who were not identified on previously produced lists of employees does not per se show that Defendants previously knowingly provided false responses to discovery requests. Although Plaintiffs have provided the Court with “a true and correct summary of the employees identified by Alpha Oil's employee files and list with the other Defendant companies’ employee lists [sic],” that summary is simply a list of employee names. (See, Lawrie Aff., [Docket No. 164], 5; Id. at Exh. O, [Docket No. 164-5], 42-44). Neither in this Exhibit nor anywhere else in their written submissions do Plaintiffs identify for this Court the discovery responses in which Defendants should have provided these employees’ names. Plaintiffs also fail to proffer any evidence which would suggest that these identified individuals actually performed paid work for any of the Defendant companies. In summary, Plaintiffs’ contentions that Defendants knowingly and purposefully provided false responses to Plaintiffs’ Interrogatory Nos. 1 and 10 are not supported by the record or by Plaintiffs’ written submissions to this Court.

In addition, the cases Plaintiffs cite in support are easily and materially factually distinguishable from the case presently before the Court. In Legault v. Zambarano, 105 F.3d 24, 25-26 (1st Cir. 1997), the First Circuit affirmed the imposition of monetary sanctions upon a party and his attorney who had responded to discovery requests focused on hiring practices by asserting that hiring was based on objective testing. The district court learned that “[h]iring decisions were, in fact, based on undisclosed, subjective criteria within the discretion of the defendants. The town's impressive edifice of purportedly objective, multi-stage testing was ultimately acknowledged to be a mirage—in the words of the district judge, ‘a sham.’ ” Id. at 26. The First Circuit affirmed the district court's conclusion that the substantial delay and expense caused by these patently false answers merited sanctions. Id. at 27.

Similarly, in Dotson v. Bravo, 202 F.R.D. 559 (N.D. Ill. 2001), the district court dismissed with prejudice a civil action in which the court found that the plaintiff had persistently engaged in a pattern of intentional obstruction and interference with the administration of justice by continuously lying in discovery responses about his identity and, therefore, about his prior arrest history. The Plaintiff in that case literally attempted to bring suit under a fraudulent identity and, in doing so, committed perjury and “intentionally and willfully provided false and misleading answers on a continual basis during the discovery process.” Id. at 571-72, 575. Dotson and Legault are materially factually distinguishable in that the conduct in those cases which led to sanctions was clearly far more egregious than any of the discovery productions alleged herein. Despite Plaintiffs’ citation to those cases and Plaintiffs’ general accusations that Defendants have demonstrated “utter disregard to verify the veracity of their discovery responses,” Plaintiffs have not shown that Defendants have committed sanctionable conduct by knowingly and purposefully providing false responses to discovery requests related to the identities of Defendants’ employees.

*17 Accordingly, this Court denies Plaintiffs’ Motion for Discovery Sanctions, [Docket No.158], to the extent that it requests sanctions based on the allegation that Defendants knowingly and purposefully failed to provide true and complete responses to Plaintiffs’ Interrogatory Nos. 1 and 10.

3. Misrepresentations to the Court

Next, Plaintiffs argue that Defendants’ counsel should be sanctioned for violation of Minnesota Rule of Professional Conduct (“MRPC”) 3.3, which states:

Plaintiffs base their assertion that Defense counsel violated MRPC 3.3 on Defense counsel's failure to speak up and correct Plaintiffs’ counsel when she made the following statement at the February 15, 2017, Motions Hearing: “[i]t's my understanding, and defendant[s’] counsel can correct me if I'm wrong, that all paper[ ] documents have in fact been produced.” (Mem. in Supp., [Docket No. 160], 37-38; Transcript of Feb. 15, 2017, Motions Hearing, [Docket No. 156], 50). Plaintiffs assert that they made this statement based upon Defendants’ assertions in their Memorandum in Opposition to Plaintiffs’ Motion to Compel, [Docket No. 141], that (1) Defendants had provided a complete inventory of all responsive documents other than “a handful of boxes located in Pennsylvania” and (2) Defendants had been forthcoming with documents and met their obligations under the relevant Federal Rules of Civil Procedure.[13] (Mem. in Supp., [Docket No. 160], 36). Plaintiffs allege that these assertions by Defendants’ counsel were false and that Defendants’ counsel compounded these misrepresentations by failing to correct Plaintiffs’ assertion to the Court at the February 15, 2017, Motions Hearing, as well as, by further representations made by Defendants’ counsel to Plaintiffs’ counsel thereafter. (Id. at 38).

*18 To support their assertion that Defendants’ counsel's statements and actions constituted false representations to the Court, Plaintiffs point out that two days after the February 15, 2017, Motions Hearing, Defendants produced additional responsive paper documents. (Id. at 39). Plaintiffs’ counsel then characterizes the subsequent emails she received from Defendants’ counsel as containing further misrepresentations, such as (1) Defense counsel's initial earlier assertion that Plaintiffs had possession of the documents produced on February 17, 2017, before the February 15, 2017, Motions Hearing; (2) Defense counsel's assertion, without having reviewed the Alpha employee files in question, that those files contained mostly paystubs and information already available to Plaintiffs; and (3) Defense counsel's reassertion at a later date that the files contained “no new information.” (Id. at 39-41). Plaintiffs point out that Defendants thereafter produced an additional 831 pages of responsive documents and Defendants refused to comply with Plaintiffs’ request that Defendants contact the Court to inform the Court of these occurrences. (Id. at 41).

In response, Defendants’ counsel maintains that he did not knowingly make any false statements to the Court or knowingly fail to correct untrue statements by Plaintiffs’ counsel. (Mem. in Opp., [Docket No. 174], 33). Defendants’ counsel contends that at the February 15, 2017, Motions Hearing, he believed at that time that all responsive paper documents had been produced, and it was only during review after that hearing, that Defense counsel discovered his clients had additional responsive documents and produced those to Plaintiffs. (Id. at 34; April 12, 2017, Motions Hearing, Digital Record, 12:51-52).

Defendants now acknowledge that the Alpha employee files produced after the February 2017, hearing were responsive to Plaintiffs’ Document Request No. 163, made on November 30, 2016, which asked for “[a]ny and all employee files for any employee who was employed by you during the period of January 1, 2008 through the present.”[14] (Id.; see, also, Lawrie Aff., Exh. E, [Docket No. 127-1], 45, 51-52). Defendants served their initial production of documents responsive to Document Request No. 163 on December 30, 2016, and they now maintain they only discovered the additional responsive documents after the February 15, 2017, Motions Hearing.

As set forth above, MRPC 3.3(a) explicitly requires the alleged attorney conduct in violation to be “knowing.” There is no indication in the record currently before the Court that at the time Defendants’ counsel stood silent in the face of Plaintiffs’ assertion to this Court on February 15, 2017, that all responsive paper documents had been produced, Defendants’ counsel knew that statement to be untrue. Similarly, the record does not support a finding that any of the other actions or statements relied upon by Plaintiffs to support their contention that Defense counsel violated MRPC 3.3 were knowingly false or fraudulent.

However, Rule 37(c) and (d) allow for the imposition of sanctions when a party's “lack of diligence in timely and completely responding to discovery in the present case” causes the incurrence of attorney's fees and other expenses. See, also, Beltt v. Randall, No. 13-cv-1693 (SRN/LIB), 2014 WL 2560610, *6 (D. Minn. March 31, 2014). On the present record, a lack of diligence by the Defendants themselves in searching for responsive paper documents is evident.

In the present case, Defendants’ counsel candidly acknowledged on the record at the April 12, 2017, Motions Hearing and in Defendants’ Memorandum in Opposition to the present Motion that the belated and untimely production of some of the employee files was due to counsel's oversight and failure to include the files in earlier discovery production. (Mem. in Opp., [Docket No. 174], 34; April 12, 2017, Motions Hearing, Digital Record, 12:51-55). It is also evident on the present record that Defendants themselves were not diligent in timely finding all of the responsive paper documents which have now been produced. (Chase Dec., [Docket No. 176], 2-3; Lawrie Aff., Exh. J, [Docket No. 164-4], 108; Kappenman Dec., Exh. 30, [Docket No. 175-1], 102-03). Accordingly, the Court finds that Defense counsel's and Defendants’ lack of diligence in reviewing the documents in Defendants’ possession to ensure timely and complete discovery production cost Plaintiffs time and lost opportunity in having to prepare and argue the motion on February 15, 2017, as well as, the present Motion. As such, an award based upon the attorney's fees incurred in preparation and execution of the present Motion is appropriate. See, Card Tech. Corp., 249 F.R.D. at 571 (“The sanction imposed must be fair and tailored to the issue raised by discovery order.”).

*19 Plaintiffs’ counsel is therefore ordered to submit to this Court within 10 days of the date of this Order details regarding the time billed by Plaintiffs’ counsel for drafting the present motion; driving to and from the April 12, 2017, Motions Hearing; and presenting argument at the April 12, 2017, Motions Hearing. After the Court receives this information from Plaintiffs’ counsel, the Court will calculate the amount in attorney fees which constitutes an appropriate sanction, to be paid 2/3 by Defendants and 1/3 by Defense counsel's law firm to Plaintiffs for both the Defense counsel's and Defendants’ lack of diligence in responding to Plaintiffs’ discovery requests.

Accordingly, this Court denies Plaintiffs’ Motion for Discovery Sanctions, [Docket No.158], to the extent that it requests sanctions based on an allegation that Defendants’ counsel made knowing misrepresentations to the Court. However, the Court grants Plaintiffs’ Motion for Discovery Sanctions, [Docket No. 158], to the extent that it asks for sanctions based upon Defendants’ failure to timely answer Document Request No. 163 and produce the relevant employee files.

4. Sanctions Requested

In the final portion of their Memorandum in Support, Plaintiffs identify the sanction(s) they believe should be imposed in response to Defendants’ alleged violations. (Mem. in Supp., [Docket No. 160], 41-43). Plaintiffs first ask the Court to enter a judgment in their favor on the alter ego issue. (Id. at 43).

The Court denies this request.

“[E]ntry of judgment is rarely an appropriate Rule 37 sanction and will be considered ‘just’ only upon a finding of willfulness and bad faith.” Steinlage v. Mayo Clinic Rochester, 235 F.R.D. 668, 671 (D. Minn. 2006) (citing Comiskey v. JFTI Corp., 989 F.2d 1007, 1009-10 (8th Cir. 1993)). “ ‘Default judgment is appropriate where the party against whom the judgment is sought has engaged in “willful violations of court rules, contumacious conduct, or intentional delays.’ ”” Country Inns & Suites By Carlson, Inc. v. UMIYA Hospitalities, L.L.C., No. 12-cv-1488 (DSD/JJK), 2014 WL 12603062, *5 (D. Minn. Jan. 31, 2014) (quoting Forsythe v. Hales, 255 F.3d 487, 490 (8th Cir. 2001) (finding default judgment appropriate where the defendants completely failed to participate in discovery)). For example, entry of default judgment as a discovery sanction was appropriate when the defendants failed to comply with three discovery orders directing them to cooperate in discovery. See, Valley Min., LLC v. U.S., No. 6-cv-3667 (JRT/FLN), 2012 WL 694470, *2 (D. Minn. March 1, 2012) (adopting recommendation of a sanction of default judgment and noting that the defendants’ only objection to the recommendation was “that they served ‘Silent Judicial Notice’ upon” the magistrate judge and the district court judge).

However, such severe, dispositive sanctions are generally inappropriate where a party's failure to comply with court orders or discovery obligations was not due to willfulness or was attributable only to a lack of diligence. See, Hansen v. Muiznieks, No. 10-cv-4777 (SRN/SER), 2013 WL 4494126, *2 (D. Minn. Aug. 21, 2013) (citing Edgar v. Slaughter, 548 F.2d 770, 771 (8th Cir. 1977), and Mann v. Lewis, 108 F.3d 145, 147 (8th Cir. 1997)). For example, the Hansen court declined to impose dismissal of certain claims with prejudice as a Rule 37 sanction because “the delay and lack of diligence appear to have been solely that of Plaintiff's former counsel and not the result of Plaintiff's own willful disobedience.” 2013 WL 4494126, at *3. The circumstances in the present case are more analogous to the circumstances in Hansen, which did not warrant a dispositive sanction, than to the circumstances in Valley Min., LLC, which warranted entry of default judgment.

*20 “While the Court may impose a variety of sanctions pursuant to Rule 37, the entry of default judgment ‘should be a rare judicial act,’ and the Court is required to consider whether a lesser sanction is available or appropriate.” Select Comfort Corp. v. Arrowood Indemnity Co., No. 13-cv-2975 (JNE/FLN), 2014 WL 12605456, *3 (D. Minn. Oct. 6, 2014). In the present case, the failure to timely comply with discovery obligations was due to both Defendants’ and Defendants’ counsel's lack of diligence.

For the reasons stated above, this Court has rejected Plaintiffs’ contentions that Defendants willfully or knowingly engaged in behavior that merits sanctions under Rule 37. Therefore, the Court denies Plaintiffs’ request for the sanction of entry of judgment in Plaintiffs’ favor on the alter ego issue in this case.

In the alternative, Plaintiffs ask the Court to order Defendants and Defense counsel to, at their own expense: “(1) produce a complete searchable copy of the Foundation database ..., and (2) obtain and produce a searchable forensic imaging of Defendants’ [entire] computer systems, including all correspondence to enable the Trustees to be assured protection from additional intentional disregard of Court Rules, Order, and improper gamesmanship.” (Mem. in Supp., [Docket No. 160], 43). Plaintiffs also ask the Court to “reconsider all motions that were heard on February 15, 2017, which were the subject of the Order dated March 6 [sic], 2017, which were obviously adjudicated on a false and incomplete record.” (Id.).

First, the Court denies Plaintiffs’ request for a complete searchable copy of the Foundation program, for the reasons already set forth above.

Second, the Court denies Plaintiff's request for a searchable forensic imaging of Defendants’ entire computer systems in their entirety. Such an order would overreach Plaintiffs’ current allegations of discovery violations, which (as far as ESI is concerned) appear to encompass only the Foundation program and the one shared desktop electronic file. Moreover, Plaintiffs have already once requested access to the entirety of Defendants’ computer systems and ESI ensconced therein, and this Court denied that request in its March 3, 2017, Order. ( [Docket No. 149] ). As set forth above, Plaintiffs once again have not indicated that they have any strategy for effectively utilizing the more than 6 million documents such an electronic production would result in producing.

Third, the Court denies Plaintiffs’ request that it reconsider its March 3, 2017, Order. Local Rule 7.1(j) states: “Except with the court's prior permission, a party must not file a motion to reconsider. A party must show compelling circumstances to obtain such permission.” Plaintiffs have not requested or received this Court's permission to file a motion to reconsider. Even if they had done so, nothing in their current Memorandum in Support affects the rationale in the Court's prior Order. In addition, Local Rule 72.2.(a) establishes the procedure for a party to seek review of a magistrate judge's order on a pretrial matter not dispositive of a party's claim or defense. Plaintiffs have requested and received from the District Court an extension of time in which to file any objections to this Court's March 3, 2017, Order. (See, [Docket No. 168] ). To the extent that Plaintiffs might wish to continue to seek review of this Court's March 3, 2017, Order, Local Rule 72.2(a) provides the avenue for Plaintiffs to do so.

IV. CONCLUSION

*21 For the foregoing reasons, and based on all of the files, records, and proceedings herein, IT IS HEREBY ORDERED: