Beattie et al v. Skyline Corporation et al, No. 3:2012cv02528 - Document 213 (S.D.W. Va. 2014)
Court Description: MEMORANDUM OPINION AND ORDER granting in part and denying in part 162 MOTION for Protective Order, as follows: Vanderbilt Mortgage and Finance, Inc.'s motion for protective order seeking to prohibit Plaintiffs from inquiring about topics 6, 7, 8, 9, 10, 11, 12, 13, and 14 is GRANTED; and Vanderbilt Mortgage and Finance, Inc.'s motion for protective order seeking to prohibit production of documents is DENIED. Signed by Magistrate Judge Cheryl A. Eifert on 10/8/2014. (cc: attys; any unrepresented party) (mkw)
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Beattie et al v. Skyline Corporation et al Doc. 213 IN TH E U N ITED STATES D ISTRICT COU RT FOR TH E SOU TH ERN D ISTRICT OF W EST VIRGIN IA H U N TIN GTON D IVISION JON ATH AN BEATTIE, and H EATH ER BEATTIE, Plain tiffs , v. Cas e N o .: 3 :12 -cv-0 2 52 8 SKYLIN E CORPORATION , a foreign Corporation, CMH H OMES, IN C., d/ b/ a Luv Hom es # 760 , and VAN D ERBILT MORTGAGE AN D FIN AN CE IN C., D e fe n d an ts , _________________________________ CMH H OMES, IN C., Th ird -Party Plain tiff, v. BOB S H OME SERVICES, LLC, Th ird -Party D e fe n d an t. MEMORAN D U M OPIN ION AN D ORD ER Pending is the Motion of Defendant Vanderbilt Mortgage and Finance, Inc. ( VMF ) for Protective Order. (ECF No. 162). Plaintiffs have filed a m em orandum in opposition to the m otion, (ECF No. 195), and VMF has replied. (ECF No. 20 1). Therefore, the m atter is fully briefed. For the reasons that follow, the Court GRAN TS, in part, and D EN IES, in part, the m otion for protective order. 1 Dockets.Justia.com I. Re le van t Facts Plaintiffs J onathan and Heather Beattie filed this lawsuit after they purchased a new Skyline Corporation m obile hom e from CMH Hom es in the Fall of 20 0 7. According to the Beatties, the m obile hom e was defective and dam aged when delivered, and was im properly installed. Although the Beatties rejected it, the Defendants refused to repair the m obile hom e, or take it back and refund the Beatties m oney. The Beatties claim that VMF, the financing com pany, was aware of the problem s with the m obile hom e and acted unconscionably by inducing them to enter into the financial transaction subsidizing the sale of the m obile hom e. Plaintiffs served Defendant VMF with an Am ended Notice of Rule 30 (b)(6) Deposition that included fourteen (14) topics of inquiry and two docum ent requests. (ECF No. 10 7). VMF objected to som e portions of the notice, so counsel for the parties attem pted to resolve their differences.1 However, after discussing the m atter over the telephone and m eeting in person, the parties were unable to agree on the scope of the deposition. Therefore, VMF filed the instant m otion for protective order, requesting the Court to enter an order prohibiting Plaintiffs from asking VMF s corporate designee questions regarding eight of the fourteen topics, and excusing VMF from com plying with one of the docum ent requests. II. Co n tro llin g Le gal Prin cip le s Federal Rule of Civil Procedure 26(b)(1) provides that [p]arties m ay obtain discovery regarding any m atter, not privileged, that is relevant to the claim or defense of any party, including the existence, description, nature, custody, condition, and location 1 VMF refers to various exhibits in its motion for protective order, but no exhibits were attached to the m otion or the supporting m em orandum . Therefore, the undersigned could not consider them . 2 of any books, docum ents, or other tangible things and the identity and location of persons having knowledge of any discoverable m atter ... Relevant inform ation need not be adm issible at the trial if the discovery appears reasonably calculated to lead to the discovery of adm issible evidence. Although the Federal Rules of Civil Procedure do not define what is relevant, Rule 26(b)(1) m akes clear that relevancy in discovery is broader than relevancy for purposes of adm issibility at trial.2 Caton v. Green Tree Services, LLC, Case No. 3:0 6-cv-75, 20 0 7 WL 2220 281, at *2 (N.D.W.Va. Aug. 2, 20 0 7) (the test for relevancy under the discovery rules is necessarily broader than the test for relevancy under Rule 40 2 of the Federal Rules of Evidence ); Carr v. Double T Diner, 272 F.R.D. 431, 433 (D.Md. 20 10 ) ( The scope of relevancy under discovery rules is broad, such that relevancy encom passes any m atter that bears or m ay bear on any issue that is or m ay be in the case ). For purposes of discovery, inform ation is relevant, and thus discoverable, if it bears on, or ... reasonably could lead to other m atter[s] that could bear on, any issue that is or m ay be in the case. Although the pleadings are the starting point from which relevancy and discovery are determ ined ... [r]elevancy is not lim ited by the exact issues identified in the pleadings, the m erits of the case, or the adm issibility of discovered inform ation. Kidw iler v. Progressive Paloverde Ins. Co., 192 F.R.D. 193, 199 (N.D.W.Va. 20 0 0 ) (internal citations om itted). Depending upon the needs of the particular case, the general subject m atter of the litigation governs the scope of relevant inform ation for discovery purposes. Id. The party resisting discovery, not the party seeking discovery, bears the burden of persuasion. See Kinetic Concepts, 2 Under the Federal Rules of Evidence, relevant evidence is evidence having any tendency to m ake the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence. Boy kin Anchor Co., Inc. v. W ong, Case No. 5:10 -cv-591FL, 20 11 WL 5599283 at * 2 (E.D.N.C. Nov. 17, 20 11) (citing United Oil Co., v. Parts Assocs., Inc, 227 F.R.D. 40 4. 40 9 (D.Md. 20 0 5)). 3 Inc. v. ConvaTec Inc., 268 F.R.D. 226, 243 44 (M.D.N.C. 20 10 )(citing W agner v. St. Paul Fire & Marine Ins. Co., 238 F.R.D. 418, 424 25 (N.D.W.Va. 20 0 6). Sim ply because inform ation is discoverable under Rule 26, however, does not m ean that discovery m ust be had. Schaaf v. Sm ithKline Beecham Corp., 233 F.R.D. 451, 453 (E.D.N.C. 20 0 5) (citing N icholas v. W y ndham Int'l, Inc., 373 F.3d 537, 543 (4th Cir. 20 0 4)). For good cause shown under Rule 26(c), the court m ay restrict or prohibit discovery that seeks relevant inform ation when necessary to protect a person or party from annoyance, em barrassm ent, oppression, or undue burden or expense. Fed. R. Civ. P. 26(c). To succeed under the good cause standard of Rule 26(c), a party m oving to resist discovery on the grounds of burdensom eness and oppression m ust do m ore to carry its burden than m ake conclusory and unsubstantiated allegations. Convertino v. United States Departm ent of Justice, 565 F. Supp.2d 10 , 14 (D.D.C. 20 0 8). In addition, Rule 26(b)(2)(C) requires the court, on m otion or on its own, to lim it the frequency and extent of discovery, when (1) the discovery sought is unreasonably cum ulative or duplicative; (2) the discovery can be obtained from som e other source that is m ore convenient, less burdensom e, or less expensive; (3) the party seeking the discovery has already had am ple opportunity to collect the requested inform ation by discovery in the action; or (4) the burden or expense of the proposed discovery outweighs its likely benefit, considering the needs of the case, the am ount in controversy, the parties resources, the im portance of the issues at stake in the action, and the im portance of the discovery in resolving the issues. Fed. R. Civ. P. 26(b)(2)(C)(i)-(iii). This rule cautions that all perm issible discovery m ust be m easured against the yardstick of proportionality. Ly nn v. Monarch Recovery Managem ent, Inc., 4 285 F.R.D. 350 , 355 (D. Md. 20 12) (quoting Victor Stanley , Inc. v. Creative Pipe, Inc., 269 F.R.D. 497, 523 (D. Md. 20 10 )). To insure that discovery is sufficient, yet reasonable, district courts have substantial latitude to fashion protective orders. Seattle Tim es Co. v. Rhinehart, 467 U.S. 20 , 36, 10 4 S.Ct. 2199, 81 L.Ed.2d 17 (1984). III. D is cu s s io n VMF first objects to topics 6, 7, and 8 of the Am ended Notice of Deposition, arguing that these topics seek irrelevant inform ation. Topics 6, 7, and 8 ask for testim ony related to VMF s appraisal used to support the Beatties loan; any investigation of the Beatties ability to repay the loan; and VMF s general policies, guidelines, and practices to investigate and confirm a borrower s ability to repay a loan. Plaintiffs contend that VMF s m otion should be denied for two reasons. First, Plaintiffs allege in the com plaint that VMF induced them to enter into an unconscionable financial transaction. Accordingly, topics pertaining to their loan and to VMF s loan practices are relevant. Second, VMF fails to provide specific exam ples of harm that would result from answering the discovery, which is necessary to show cause for a protective order. Instead, VMF m erely supplies boilerplate objections, which are tantam ount to m aking no objection at all. Contrary to Plaintiffs assertion, the undersigned agrees with VMF that topics 6, 7, and 8 do not request relevant inform ation and thus are not appropriate topics for a Rule 30 (b)(6) deposition. While the com plaint does include a few allegations regarding the financing of the m obile hom e, the core concerns from which all of the claim s derive are the condition of the m obile hom e on delivery and its installation. This is not a case based on an alleged predatory loan, or fraudulent m ortgage refinancing schem e. Plaintiffs state no factual allegations to suggest that absent the purported dam age to and 5 im proper installation of the m obile hom e, they would have asserted a claim against VMF for wrongdoing related to the financing of the hom e. As VMF points out, Plaintiff J onathan Beattie testified that no one m isled him about the price or cost of the m obile hom e, and he has no recollection of the events surrounding the closing. In addition, Plaintiff Heather Beattie confirm ed that her problems with the hom e developed after com pletion of the sale. Finally, the only appraisal apparently perform ed in this case was of the land on which the m obile hom e sits, not of the hom e itself. Although discovery is broad, it is not boundless. Discovery is lim ited to relevant m atters. Relevant m atters are those relating to the claim s and defenses of the parties. See Marfork Coal Co., Inc. v. Sm ith, 274 F.R.D. 193, 20 3 (S.D.W.Va. 20 11). A court m ay extend discovery to include issues touching on the general subject m atter of the action, depending on the circum stances of the case, the nature of the claim s and defenses, and the scope of the discovery requested. Id. (citing Fed. R. Civ. P. 26(b)(1) 20 0 0 Advisory Com m ittee s Note). However, parties have no entitlem ent to discovery to develop new claim s or defenses that are not already identified in the pleadings. Id. In this case, Plaintiffs have not provided any basis for the discovery sought in topics 6, 7, and 8. VMF next objects to topics 9, 10 , 11, 12, 13, and 14, which require a corporate designee to discuss [a]ny evidence that Vanderbilt intends to introduce at trial regarding various issues in dispute. VMF does not contest the subject m atter of the topics, so m uch as Plaintiffs dem and that the designee be prepared to disclose the evidence to be used at trial. In VMF s view, these topics are prem ature and inappropriate because they require VMF to be fully prepared for trial by the tim e of the deposition well before any other party, and without the benefit of com pleted discovery. VMF also argues that the topics im properly invade the authority of the Court s 6 Scheduling Order, which does not require the parties to disclose trial exhibits until m uch later. VMF contends that it should not be forced to disclose its defenses prem aturely; particularly, as it has not yet determ ined what evidence it intends to use at trial. In response, Plaintiffs assert that the topics are relevant and, therefore, they can be discovered. Plaintiffs claim that VMF s argum ent of prem aturity is without m erit, although they provide no rationale or legal support for their position. Finally, Plaintiffs reiterate that VMF has failed to m ake the necessary showing to support good cause for a protective order. The undersigned again agrees with VMF that topics 9 through 14 are flawed. The fundam ental problem s with these topics are that they seek case determ inations rather than inform ation, and they seek determ inations that are comm only m ade by legal counsel rather than by corporate designees. See Gulf Production Com pany , Inc. v. Hoover Oilfield Supply , Inc., Case Nos. 0 8-50 16, 0 9-2779, 0 9-0 10 4, 20 11 WL 1791286, at *4 (E.D.La. May 9, 20 11). The purpose of a Rule 30 (b)(6) deposition is to obtain a corporation s knowledge and m em ory of the facts, its interpretation of key docum ents, and its opinions and positions on disputed factual issues. Instead of asking for that inform ation, Plaintiffs request the strategy and work product of VMF s counsel. Plaintiffs offer no reason under the Rules of Civil Procedure that would entitle them to that inform ation. Thus, these are not proper topics for a Rule 30 (b)(6) deposition. Finally, VMF objects to Plaintiffs request for the production of docum ents, which states that to the extent not previously produced during the course of discovery in this case, Vanderbilt shall produce at its deposition all docum ents ... reviewed and/ or relied upon by its designated representative(s): (1) in preparation for the deposition; (2) in 7 preparing a report (if any); (3) in rendering an opinion in this case; and (4) in addressing any m atter related to the subject hom e s perform ance or condition from its in-service date to the present. (ECF No. 10 7 at 3). According to VMF, the Court should prohibit Plaintiffs from obtaining the docum ents described in this request because it would require VMF to produce docum ents protected by the work-product doctrine and the attorney-client privilege. (ECF No. 163 at 8). Alternatively, VMF asks the Court to require that the deposition transcript and all docum ents produced at the deposition be sealed and opened only by court order. In response, Plaintiffs argue that VMF has not identified any docum ents that are privileged; accordingly, it is im possible to evaluate the validity of VMF s position. Plaintiffs also em phasize that VMF once again fails to carry its burden to m ake a good cause showing. Federal Rule of Civil Procedure 26(b)(5) sets out the process a party m ust follow when withholding otherwise discoverable m aterials under a claim of privilege. Regardless of which m ethod of discovery is em ployed by the inquiring party, when responding to a discovery request, the answering party m ay refuse to disclose inform ation or docum ents that are privileged. The party claim ing the privilege m ust expressly m ake the claim , and supply a privilege log as outlined in Rule 26(b)(5)(A)(ii). Given that this well-defined procedure is explicitly contained in the federal discovery rules, and adequately addresses VMF s concerns, there is no need for the Court to issue a protective order governing the docum ents produced at the deposition. VMF should sim ply follow the Rule in the case of any privileged docum ents. 8 IV. Ord e r Wherefore, the Court GRAN TS, in part, and D EN IES, in part, the m otion for protective order, as follows: 1. VMF s m otion for protective order seeking to prohibit Plaintiffs from inquiring about topics 6, 7, 8, 9, 10 , 11, 12, 13, and 14 is GRAN TED ; and 2. VMF s m otion for protective order seeking to prohibit the production of docum ents is D EN IED . The Clerk is directed to provide a copy of this Order to counsel of record and any unrepresented party. EN TERED : October 8, 20 14 9
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