Jeff Tracy, Inc. v. Scottsdale Ins. Co.
Jeff Tracy, Inc. v. Scottsdale Ins. Co.
2015 WL 13917138 (C.D. Cal. 2015)
November 24, 2015

Wistrich, Andrew J.,  United States Magistrate Judge

Exclusion of Evidence
Failure to Produce
Cost-shifting
Sanctions
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Summary
The court did not address any ESI. Therefore, no sanctions were imposed related to the failure to disclose or produce ESI.
JEFF TRACY, INC. et al.
v.
SCOTTSDALE INSURANCE CO., et al
Case No. SACV 14-1532 DOC (AJWx)
United States District Court, C.D. California, Western Division
Filed November 24, 2015

Counsel

Ysela Benavides, Deputy Clerk, ATTORNEYS PRESENT FOR PLAINTIFFS: None Present
Court Reporter, ATTORNEYS PRESENT FOR DEFENDANTS: None Present
Wistrich, Andrew J., United States Magistrate Judge

ORDER REGARDING DEFENDANT'S MOTION FOR EVIDENTIARY AND/OR MONETARY SANCTIONS

*1 Defendant seeks a variety of sanctions to remedy plaintiffs' failure to disclose or to produce in response to an order various information and materials. For the following reasons, the motion is granted in part and denied in part, as explained below.
 
“Federal Rule of Civil Procedure 37 authorizes the district court, in its discretion, to impose a wide range of sanctions when a party fails to comply with the rules of discovery or with court orders enforcing those rules.” Wyle v. R.J. Reynolds Indus., Inc., 709 F.2d 585, 589 (9th Cir. 1983). Under Rule 37(b), if a party fails to obey an order to provide or permit discovery, the court may “issue further just orders,” which “may include” an order: (1) designating facts to be taken as established; (2) prohibiting the disobedient party from supporting designated claims or defenses, or from introducing designated matters in evidence; (3) striking pleadings of the disobedient party in whole or in part; or (4) dismissing the action or rendering a default judgment against the disobedient party. Fed. R. Civ. P. 37(b)(2)(A)(i)-(vii). “Rule 37 sanctions, including dismissal, may be imposed where the violation is due to willfulness, bad faith, or fault of the party. Disobedient conduct not shown to be outside the litigant's control meets this standard.” In re Phenylpropanolamine (PPA) Products Liab. Litig., 460 F.3d 1217, 1233 (9th Cir. 2006)(internal quotation marks, citations, and italics omitted); see In re Exxon Valdez, 102 F.3d 429, 432 (9th Cir. 1996)(same).
 
Rule 37(c)(1) provides that a party is not allowed to use information or materials it failed to initially disclose under Fed. R. Civ. P. 26(a)(1) on a motion, at a hearing, or at trial. This sanction is “automatic” and may be imposed unless the party shows that the failure was “substantially justified” or “harmless.” Hoffman v. Constr. Protective Servs., Inc., 541 F.3d 1175, 1179 (9th Cir. 2008); Yeti by Molly, Ltd. v. Deckers Outdoor Corp., 259 F.3d 1101, 1106 (9th Cir. 2001). “The party facing sanctions bears the burden of proving that its failure to disclose the required information was substantially justified or harmless.” R&R Sails, Inc. v. Insurance Co. of Pa., 673 F.3d 1240, 1246 (9th Cir. 2012); see Torres v. City of L.A., 548 F.3d 1197, 1213 (9th Cir. 2008), cert. denied, 556 U.S. 1183 (2009). A failure to disclose may be harmless if the additional or corrective information has been “made known to the other parties during the discovery process or in writing.” See Fed. R. Civ. P. 26(e)(1)(A). Such supplementation must be made “with special promptness as the trial approaches.” Advisory Comm. Note to 1993 Amend. to Fed. R. Civ. P. 26(e). A showing of willfulness or bad faith is not required, Hoffman, 541 F.3d at 1180, unless the exclusion is tantamount to a terminating sanction, such as the exclusion of all evidence of attorneys fees. R&R Sails, Inc., 673 F.3d at 1246.
 
Plaintiffs failed to file either opposition to the motion or a notice of non-opposition as required. See C.D. Cal. L. R. 7-9. Even defendant's reply, which noted plaintiffs' failure to oppose the motion [Reply at 2, prompted no response from plaintiffs. The court deems plaintiffs' failure to oppose the motion as plaintiffs' consent to the granting of the motion in its entirety. See C.D. Cal. L.R. 7-12.
 
*2 Plaintiffs did not comply with the August 20, 2015 order, which addressed plaintiffs' shortcomings in both disclosure and discovery and awarded monetary sanctions. They did not provide everything that was required within the deadline established by the order, and from defendant's account – which is all that the court has to go on because of plaintiffs' failure to oppose the motion – plaintiffs still may not have complied with some aspects of the order. Plaintiffs' failure to comply with the order was unjustified, unexcused, and – because compliance has not been shown to have been outside of plaintiffs' control – willful.
 
In light of plaintiffs persistent discovery misconduct (and their at least partial violation of the August 20, 2015 order), defendant is plainly entitled to shift to plaintiffs its attorneys fees and costs incurred in attempting to obtain compliance with the August 20, 2015 order and in bringing this motion. However, the amount claimed – $4,830.00 – is reduced by $460 because defendant's counsel was not required to spend 2 hours preparing for and attending a hearing on this motion. Plaintiffs are directed to pay the sum of $4,370.00 – a sum the court finds reasonable and warranted by the circumstances – to defendant within 14 days.
 
Whether the evidentiary sanctions sought by defendant are just is less clear. Plaintiffs apparently corrected some of the deficiencies in disclosure or discovery about which defendant complains, albeit belatedly. Even defendant concedes that plaintiffs produced some information or materials in response to the August 20, 2015 order, both before [see McFeely Declaration, para. 16], and after [see McFeely Declaration, para. 19], the deadline established by that order. But in the absence of evidence to the contrary, the court has no option but to accept defendant's assertions in the motion as true unless those assertions contradicted by evidence of which the court is aware. This is the position in which plaintiffs have chosen to place the court.
 
Plaintiffs are foreclosed from using on motion, at hearing, or during trial any information or materials that they were required to disclose or provide by the August 20, 2015 order but that was not disclosed or provided prior to the discovery cut-off date. Thus, plaintiffs' use of information or materials disclosed or provided after the deadline established by the August 20, 2015 order, but before the discovery cut-off date, is not foreclosed. For example, it appears that plaintiffs were at least attempting to comply with the August 20, 2015 order by providing some attorney billing statements less than 14 days after the deadline for compliance. Although the court does not condone plaintiffs' tardiness in complying with the August 20, 2015 order, and recognizes that plaintiffs' delay may have caused defendant some inconvenience, plaintiffs should not be foreclosed from using such information or materials. Although belated, plaintiffs' eventual partial compliance suggests a lack of bad faith as to the information or materials disclosed or provided before the discovery cut-off, and left defendant with at least some opportunity to use and followup on such information or materials prior to trial.
 
IT IS SO ORDERED.
 
cc: Parties
 
MINUTES FORM 11
 
CIVIL-GEN
 
Initials of Deputy Clerk________

Footnotes
Some of the relief requested by defendant is plainly non-dispositive, while some might arguably be considered dispositive. In any event, to the extent that plaintiffs have not waived their right to do so by failing to oppose the motion, if plaintiffs seek reconsideration of this order by the district judge, then they must specify the portions of this order which they contend are dispositive and the portions which they contend are non-dispositive, respectively, so that the district judge can apply the appropriate scope of review.