Pacira Pharmaceuticals, Inc. v. Research Development Foundation, No. 2:2021cv02241 - Document 136 (D. Nev. 2023)
Court Description: ORDER Granting 91 and 93 Motion to Reopen Discovery. Discovery shall be opened for these purposes until 6/29/2023. Signed by Magistrate Judge Daniel J. Albregts on 5/30/2023. (Copies have been distributed pursuant to the NEF - JQC)
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Pacira Pharmaceuticals, Inc. v. Research Development Foundation Doc. 136 Case 2:21-cv-02241-CDS-DJA Document 136 Filed 05/30/23 Page 1 of 6 1 2 UNITED STATES DISTRICT COURT 3 DISTRICT OF NEVADA 4 5 6 7 8 9 10 *** Pacira Pharmaceuticals, Inc., Case No. 2:21-cv-02241-CDS-DJA Plaintiff, v. Order Research Development Foundation, Defendant. 11 12 This is a contract dispute arising out of a royalty agreement between Pacira 13 Pharmaceuticals, Inc. and Research Development Foundation (“RDF”). Pacira sues RDF and 14 RDF counterclaims for declaratory relief regarding whether Pacira owes royalty payments to 15 RDF for certain of Pacira’s products under the agreement. Pacira moves to reopen discovery, 16 arguing that after the close of discovery, RDF: (1) submitted errata sheets to its 30(b)(6) witness’s 17 deposition that materially changed the deposition; and (2) supplemented an interrogatory response 18 with a new theory that it is entitled to royalty payments for products that use a particular 19 manufacturing process, rather than products that fall under certain patents. (ECF No. 91). Pacira 20 also filed a version of this motion under seal. (ECF No. 93). 21 After the parties fully briefed the motion to reopen discovery, the parties filed a joint 22 notice regarding the motion, explaining that the 30(b)(6) witness—Mr. Thomas Brorby—whom 23 Pacira sought to re-depose in its motion to reopen discovery, had passed away. (ECF No. 134). 24 As a result, Pacira changed its requested relief to asking the Court to strike the errata sheets, 25 which relief RDF opposes. Because the Court finds that Pacira has demonstrated good cause and 26 excusable neglect, it grants Pacira’s motion to reopen discovery (ECF No. 91) and the sealed 27 version of that motion (ECF No. 93). The Court also grants Pacira’s updated request to strike Mr. 28 Brorby’s errata sheets to his deposition. Dockets.Justia.com Case 2:21-cv-02241-CDS-DJA Document 136 Filed 05/30/23 Page 2 of 6 1 2 I. Background. Pacira moves to reopen discovery for two reasons. (ECF No. 91). First, because after the 3 close of discovery, RDF served two deposition errata sheets for Mr. Brorby—RDF’s principal 4 Rule 30(b)(6) witness and a negotiator of the agreement at issue—substantively changing Mr. 5 Brorby’s testimony. Mr. Brorby had previously testified that he had no notes to memorialize a 6 meeting regarding the agreement between Pacira and RDF. The errata sheets changed that 7 testimony to add that Mr. Brorby had a single page of handwritten notes from that meeting. 8 Second, also after the close of discovery, RDF served a supplemental response to Pacira’s 9 Interrogatory No. 4 which disclosed a new theory why RDF believes it is entitled to ongoing 10 royalty payments from Pacira. Pacira asserts that previously, RDF had asserted that it was 11 entitled to royalty payments based on certain patents. But in its supplement, RDF asserts that it is 12 entitled to royalty payments based on certain trade secrets, including a manufacturing process 13 Pacira employs. Pacira asks the Court to reopen discovery so that it can: (1) re-depose Mr. 14 Brorby regarding his errata changes; and (2) serve a single interrogatory on RDF regarding the 15 new theory and conduct a 3.5-hour Rule 30(b)(6) deposition on that theory. 16 Since Pacira filed its motion, however, Mr. Brorby has passed away. (ECF No. 134). The 17 parties thus filed a joint notice of this fact and, instead of reopening Mr. Brorby’s deposition, 18 Pacira seeks to strike the errata sheets instead. Pacira explains that, because it is now unable to 19 depose Mr. Brorby about his changes, the appropriate remedy is striking the errata sheets. 20 RDF responds that reopening discovery is unnecessary because Pacira was already aware 21 of Mr. Brorby’s handwritten notes from the meeting and because the discovery Pacira seeks to 22 remedy the issue is overbroad. (ECF No. 108). Regarding Pacira’s assertion that RDF has raised 23 a new theory, RDF asserts that its theory is not new, but that it has put its theory forth in motions 24 before. RDF also argues that the issue is ripe for summary judgment adjudication and there is no 25 reason to reopen discovery at this stage because that discovery will not change the fact that the 26 issue is ready to be decided. 27 28 Regarding striking Mr. Brorby’s errata sheets, RDF asserts that it will not rely on the handwritten notes to bolster Mr. Brorby’s testimony—mitigating Pacira’s concerns—but that it Page 2 of 6 Case 2:21-cv-02241-CDS-DJA Document 136 Filed 05/30/23 Page 3 of 6 1 wishes to keep them so that Pacira cannot attack Mr. Brorby’s testimony as being incomplete or 2 untruthful. (ECF No. 134). RDF adds that Pacira could have sought to strike the errata in its 3 original motion to reopen, but did not. RDF asserts that, the reason Pacira would have sought 4 additional testimony in the first place was to mitigate the risk that Mr. Brorby would present new 5 facts at trial not provided in his deposition. But now that Mr. Brorby has passed away, this 6 danger is mitigated and Pacira’s request to strike the errata is moot. Pacira replies that it was not aware of the notes prior to the close of discovery because Mr. 7 8 Brorby testified that he had no notes from the meeting. (ECF No. 112). Regarding RDF’s 9 assertion that its theory is not new, Pacira again points out that RDF previously asserted that its 10 royalty payments were tied to patents, not to a specific manufacturing process as they now assert. 11 II. Discussion. 12 A request to reopen discovery must be supported by a showing of good cause and 13 excusable neglect. Local Rule 26-3; Fed. R. Civ. P. 6(b)(1)(B). The good cause analysis turns on 14 whether the subject deadlines cannot reasonably be met despite the exercise of diligence. 15 Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th Cir. 1992). The showing of 16 diligence is measured by the movant’s conduct throughout the entire period of time already 17 allowed. CC.Mexicano.US, LLC v. Aero II Aviation, Inc., 2015 U.S. Dist. LEXIS 169110, at *11- 18 12, 2015 WL 10059063 (D. Nev. Dec. 15, 2015). The excusable neglect “determination is at 19 bottom an equitable one, taking account of all relevant circumstances surrounding the party’s 20 omission.” Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd. P’ship, 507 U.S. 380, 395 (1993). 21 Factors courts may consider when evaluating excusable neglect include (1) the danger of 22 prejudice to the non-moving party, (2) the length of the delay and its potential impact on judicial 23 proceedings, (3) the reason for the delay and, (4) whether the movant acted in good faith. Id. 24 Further, when determining whether to reopen discovery, courts should, 25 26 27 28 consider the following factors: 1) whether trial is imminent, 2) whether the request is opposed, 3) whether the non-moving party would be prejudiced, 4) whether the moving party was diligent in obtaining discovery within the guidelines established by the court, 5) the foreseeability of the need for additional discovery in light of Page 3 of 6 Case 2:21-cv-02241-CDS-DJA Document 136 Filed 05/30/23 Page 4 of 6 1 the time allowed for discovery by the district court, and 6) the likelihood that the discovery will lead to relevant evidence. 2 3 4 City of Pomona v. SQM N. Am. Corp., 866 F.3d 1060, 1066 (9th Cir. 2017) (internal citation omitted). 5 Federal Rule of Civil Procedure 30 provides that, “[o]n request by the deponent or a party 6 before the deposition is completed, the deponent must be allowed 30 days after being notified by 7 the officer that the transcript or recording is available in which: (A) to review the transcript of 8 recording; and (B) if there are changes in form or substance, to sign a statement listing the 9 changes and the reasons for making them.” Fed. R. Civ. P. 30(e)(1). Although the text of Rule 10 30(e) provides that changes may be “in form or substance” and indicates that “reasons” must be 11 identified for making those changes, the Rule itself does not address the proper scope of changes 12 allowed and the types of reasons that are sufficient to make changes. 13 As such, the Court looks to guidance from the Ninth Circuit. The Ninth Circuit has 14 interpreted the scope of this Rule by finding that “while the language of FRCP 30(e) permits 15 corrections ‘in form or substance,’ this permission does not properly include changes offered 16 solely to create a material factual dispute in a tactical attempt to evade an unfavorable summary 17 judgment.” Hambleton Bros. Lumber Co. v. Balkin Enterprises, Inc., 397 F.3d 1217 (9th Cir. 18 2005). The Ninth Circuit then articulated a standard, indicating that Rule 30(e) changes are “to 19 be used for corrective, and not contradictory, changes.” Id. at 1226. 20 Further, this District Court has also addressed this issue previously. The Honorable 21 Magistrate Judge Nancy J. Koppe applied Hambleton to find that Rule 30(e) changes (1) must 22 have a legitimate purpose, (2) must not be used as a sham solely to create a material issue of fact 23 to evade summary judgment, and (3) must not be used to alter what was actually said under oath. 24 Ashcraft v. Welk Resort Group Corp., 2017 WL 5180421, at *3 (D. Nev. Nov. 8, 2017). Also, 25 Judge Koppe summarized district court decisions into three groups: (1) Rule 30(e) changes are 26 improper if used in a manner akin to a sham affidavit designed to avoid summary judgment; (2) 27 Rule 30(e) changes are improper if used to alter the substance of deposition testimony in a 28 contradictory manner except when correcting transcription errors; (3) Rule 30(e) changes are Page 4 of 6 Case 2:21-cv-02241-CDS-DJA Document 136 Filed 05/30/23 Page 5 of 6 1 improper if used in either a sham manner or contradicting the testimony actually given. Id. Judge 2 Koppe concluded that, 3 4 5 6 7 8 9 if a party believes its deponent gave false testimony under oath, it may so explain to the fact-finder during the normal course of litigation…The judge or the jury will then determine whether that testimony is proper and persuasive…A party contending that its deponent gave erroneous testimony is simply prohibited from using Rule 30(e) to accomplish that end, as contradictory changes are not given the imprimatur and benefit of Rule 30(e) certification. Id. (internal citations and quotations omitted). The Court grants Pacira’s motion to reopen discovery. The Court grants Pacira’s request 10 to reopen discovery to issue another interrogatory and to conduct a limited, 3.5-hour Rule 11 30(b)(6) witness deposition on the issue of RDF’s new theory. The Court also grants Pacira’s 12 request to strike Mr. Brorby’s errata sheets. 13 Pacira has demonstrated good cause and excusable neglect necessary to warrant reopening 14 discovery. Pacira points out that RDF disclosed the errata sheets and the new theory after the 15 close of discovery, meaning that Pacira had no way of addressing these items in the discovery 16 period regardless of its diligence. First, in evaluating excusable neglect, the Court finds that the 17 danger to RDF is limited. The additional discovery that Pacira seeks is limited to an interrogatory 18 and a 3.5-hour deposition. Second, the length of the delay will be short given the limited 19 discovery Pacira seeks to conduct. Third, while reopening discovery could potentially impact the 20 scope of the parties’ summary judgment proceedings, in the event that reopening discovery has 21 this effect, the Court notes that there is a public policy favoring deciding cases on their merits. 22 Third and fourth, the Court finds that the reason for the delay was out of Pacira’s control and that 23 Pacira is acting in good faith in seeking to reopen discovery. 24 Regarding the five factors the Court must consider in deciding to reopen discovery, first, 25 trial is not imminent because the parties are still at the summary judgment stage. Second, while 26 RDF opposes the request, the Court notes that third, the prejudice that RDF will face is limited 27 given the limited additional discovery Pacira seeks to conduct. Fourth, the Court has already 28 determined that Pacira was diligent. Fifth, given the limited issues on which Pacira wishes to Page 5 of 6 Case 2:21-cv-02241-CDS-DJA Document 136 Filed 05/30/23 Page 6 of 6 1 conduct discovery, the Court does not foresee the need for even more additional discovery. And 2 sixth, Pacira has already demonstrated that the discovery it seeks to conduct would be relevant to 3 its claims. 4 Regarding Pacira’s request to strike Mr. Brorby’s errata sheets, the Court finds that Pacira 5 has the better argument. Although the Court does not find that Mr. Brorby submitted the errata 6 sheets in an attempt to influence summary judgment, the change was nonetheless substantive and 7 contradictory. As Pacira points out, the errata sheets alter what Mr. Brorby actually said under 8 oath rather than correcting transcription errors. And Pacira is no longer able to depose Mr. 9 Brorby about this change given his recent passing. On the other hand, RDF may still explain to 10 the fact finder during the normal course of litigation if it believes Mr. Brorby’s testimony was 11 erroneous. RDF is simply prohibited from using Rule 30(e) to accomplish that end. The Court 12 thus grants Pacira’s request to strike Mr. Brorby’s errata sheets. 13 14 IT IS THEREFORE ORDERED that Pacira’s motion to reopen discovery (ECF No. 91) 15 and its under seal version (ECF No. 93) are granted. Discovery is reopened for the limited 16 purpose of Pacira conducting a 3.5-hour 30(b)(6) witness deposition regarding RDF’s theory and 17 issuing a single interrogatory regarding that theory. Discovery shall be opened for these purposes 18 until June 29, 2023. The Court also strikes Mr. Brorby’s errata sheets to his deposition. 19 20 21 22 DATED: May 30, 2023 DANIEL J. ALBREGTS UNITED STATES MAGISTRATE JUDGE 23 24 25 26 27 28 Page 6 of 6
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