Clean Harbors, Inc. v. CBS Corp.

• Decision Date: 26 June 2012
• Docket Number: Case No. 10–2017–JPO.
• Citation: 875 F.Supp.2d 1311
• Parties: CLEAN HARBORS, INC. and Clean Harbors Coffeyville, LLC, Plaintiffs, v. CBS CORPORATION, Defendant.
• Court: U.S. District Court — District of Kansas

875 F.Supp.2d 1311

CLEAN HARBORS, INC. and Clean Harbors Coffeyville, LLC, Plaintiffs,

v.CBS CORPORATION, Defendant.

Case No. 10–2017–JPO.

United States District Court, D. Kansas.

June 26, 2012.

Mark Moedritzer, David R. Erickson, Mathew L. Larsen, Shook, Hardy & Bacon LLP, Kansas City, MO, for Plaintiff.

J. Nick Badgerow, Spencer Fane Britt & Browne, LLP, Overland Park, KS, James T. Price, Spencer Fane Britt & Browne LLP, Kansas City, MO, Lindsay P. Howard, Margaret N. Boyle, Steven F. Baicker–McKee, Babst Calland Clements & Zomnir, PC, Pittsburgh, PA, for Defendant.

MEMORANDUM AND ORDER

JAMES P. O'HARA, United States Magistrate Judge.

This is an environmental cleanup case brought pursuant to the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq. (“RCRA”) and under a variety of state law theories of recovery. Highly summarized, Clean Harbors, Inc. and Clean Harbors Coffeyville, LLC (collectively “Clean Harbors”) are suing CBS Corporation for damages arising from environmental contamination at a waste-management facility in Coffeyville, Kansas. Clean Harbors currently owns the facility; CBS's predecessors in interest used to own the facility. The case is now before the undersigned U.S. Magistrate Judge, James P. O'Hara, ¹ on CBS's motion to strike rebuttal expert reports (doc. 73),² CBS's motion for summary judgment (doc. 87), CBS's motion to strike an affidavit filed by Clean Harbors in opposition to the summary judgment motion, and also to strike a theory of relief not preserved in the final pretrial order (doc. 98), Clean Harbors's motion for leave to respond to CBS's submission of supplemental authority (doc. 108), and CBS's motion for leave to file supplemental submissions (doc. 110).³ The motions have been fully briefed.

I. CBS's Motion to Strike

A. DeJong Affidavit

Victor DeJong was an employee of Westinghouse, a predecessor in interest to CBS, from 1966 to 1979 and from 1984 to 1988. He worked for Aptus (a subsidiary of Westinghouse, which owned the Coffeyville facility) from 1988 to 1992. DeJong signed an affidavit on December 7, 2011, shortly before Clean Harbors filed its response to CBS's motion for summary judgment. Clean Harbors relies on DeJong's affidavit to oppose summary judgment and to support its piercing-the-corporate-veil theory of recovery. Because Clean Harbors did not disclose DeJong as a witness before discovery closed, CBS seeks to strike the affidavit and Clean Harbors's reliance on it in response to CBS's motion for summary judgment.

Federal discovery rules require parties to, “without awaiting a discovery request, provide to the other parties ... the name ... of each individual likely to have discoverable information—along with the subjects of that information—that the disclosing party may use to support its claims or defenses, unless the use would be solely for impeachment.” ⁴ A party must “supplement or correct its disclosure ... in a timely manner if the party learns that in some material respect the disclosure or response is incomplete or incorrect, and if the additional or corrective information has not otherwise been made known to the other parties during the discovery process or in writing.” ⁵ These rules are enforced by the threat of sanction—“[i]f a party fails to ... identify a witness as required by Fed.R.Civ.P. 26(a) or (e), the party is not allowed to use that information or witness to supply evidence on a motion, at a hearing, or at a trial, unless the failure was substantially justified or is harmless.” ⁶ In addition to or instead of this sanction, the court “(A) may order payment of the reasonable expenses, including attorney's fees, caused by the failure; (B) may inform the jury of the party's failure; and (C) may impose other appropriate sanctions, including any of the orders listed in Fed.R.Civ.P. 37(b)(2)(A)(i)-(vi).” ⁷

The “exclusion of evidence presented out of time is ‘automatic and mandatory’ unless the violation was either justified or harmless.” ⁸ Clean Harbors argues the court should not strike DeJong's affidavit because (1) Clean Harbors first found out DeJong had potentially relevant information after discovery closed; (2) the parties were allowed take depositions after discovery closed; (3) Clean Harbors may rely on DeJong's affidavit even if he is not on its witness list; and (4) untimely disclosure would not harm CBS.

First, the court finds Clean Harbors could have discovered DeJong's identity, and that he may have had relevant information, months before December 2011. Clean Harbors simply had to review the documents it disclosed to CBS or the documents CBS disclosed to it. On August 31, 2011, Clean Harbors disclosed a letter to DeJong from the U.S. Environmental Protection Agency (“EPA”), regarding Kansas waste removal codes and an “Emergency Contingency Plan” for the facility. The plan listed DeJong as vice president and general manager of the facility.⁹ In August 2011, CBS produced documents to Clean Harbors containing DeJong's name and role as former general manager.¹⁰

Second, although the pretrial order allowed the parties to take depositions after discovery closed, this exception applied to only two expert witnesses and unopposed discovery, “so long as it does not delay the briefing of or ruling on dispositive motions or other pretrial preparations.” ¹¹ The pretrial order does not relieve any party of complying with the mandatory disclosure requirements in Fed.R.Civ.P. 26(a) or (e).

Third, Clean Harbors's reliance on Taylor v. St. Louis Southwestern Railway Co.¹² to distinguish affidavits in opposition to summary judgment from trial testimony is unpersuasive. The sanction in Fed.R.Civ.P. 37(c)(1) expressly applies to undisclosed witnesses on which a party relies “to supply evidence on a motion.” ¹³Taylor was decided three years before Fed.R.Civ.P. 37(c) was amended to include this sanction for nondisclosure. ¹⁴ Also unpersuasive is Clean Harbors's attempt to distinguish two other cases that are on point and strongly favor striking the DeJong affidavit. ¹⁵

Clean Harbors also argues it timely disclosed DeJong as a witness because final witness lists are not due until twenty-one days before trial, and trial has not yet been scheduled. As noted above, the pretrial order does not authorize any party to shirk the mandatory disclosure requirements in Fed.R.Civ.P. 26(a) or (e). Clean Harbors argues Fed.R.Civ.P. 26(e) does not apply here because CBS knew of DeJong as early as November 8, 2011, if not earlier, and the duty to supplement initial disclosures is limited to “additional or corrective information ... not otherwise ... made known to the other parties during the discovery process or in writing.” ¹⁶ But just because CBS knew of DeJong does not mean that it knew Clean Harbors would rely on DeJong as a witness.

Fourth, Clean Harbors contends that its untimely disclosure of DeJong will not harm CBS because the trial date has not yet been set and because Clean Harbors will agree to let CBS depose DeJong before trial. The court disagrees. Allowing this new evidence at the summary judgment stage will prejudice CBS. It had no notice of Clean Harbors relying on DeJong as a witness until after CBS filed its motion for summary judgment. CBS did not depose DeJong during discovery and did not explore the matters covered in DeJong's affidavit because Clean Harbors had not identified him as a witness. As in Sinks, allowing CBS the opportunity to cure this prejudice would require reopening discovery, re-briefing the pending summary judgment motion, and possibly scheduling trial to begin on a later date than it otherwise would have.¹⁷

Clean Harbors has not shown that its failure to disclose DeJong as a witness was substantially justified or harmless. The court therefore strikes the DeJong affidavit.¹⁸ Even if the court considered the affidavit, it would not change the court's decision to grant summary judgment in favor of CBS, as discussed below.

B. Piercing–the–Corporate–Veil Theory

CBS seeks to strike from Clean Harbors's response any reference to or reliance on Clean Harbors's piercing-the-corporate-veil theory because Clean Harbors did not properly preserve the theory in the pretrial order. The pretrial order (doc. 90) controls the course of the action unless modified by the court in accordance with D. Kan. Rule 16.2(c).¹⁹ The purpose of the pretrial order is to “insure the economical and efficient trial of every case on its merits without chance or surprise.” ²⁰ Pretrial orders “should be liberally construed to cover any of the legal or factual theories that might be embraced by their language.” ²¹ But this “does not require courts to fabricate a claim that a plaintiff has not spelled out.” ²² Any “claims, issues, defenses, or theories of damages not included in the pretrial order are waived.” ²³ The decision to exclude facts or issues as not found in the pretrial order is committed to the trial court's sound discretion.²⁴

In exercising this discretion, the court “should not be inflexible.” ²⁵ Rather, it should strike a balance between “too-easy modification” that would encourage carelessness in the preparation and approval of the initial order and “unswerving insistence upon every provision, under all circumstances,” which may work an injustice in individual cases.²⁶

In opposition to the motion to strike, Clean Harbors argues (1) it reasonably identified the theory in the pretrial order, (2) it didn't need to designate piercing the corporate veil as a separate and independent theory of liability, and (3) CBS has known piercing the corporate veil is an issue in the case.

First, Clean Harbors relies on seven passages in the pretrial order to show it reasonably identified the piercing-the-corporate-veil theory.²⁷ Each passage involves claims or defenses regarding CBS's liability for the activities of “other entities for whom CBS is allegedly responsible,” ²⁸ its “predecessors (Westinghouse, Aptus, and/or NEI), for whom CBS...