Cohen v. Trump
| Decision Date | 09 June 2015 |
| Docket Number | Civil No. 13-CV-2519-GPC (WVG) |
| Court | U.S. District Court — Southern District of California |
| Parties | ART COHEN, Plaintiff, v. DONALD J. TRUMP, Defendant. |
ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF'S MOTION TO COMPEL DISCOVERY
[DOC. NO. 86]
On May 28, 2015, counsel for both parties informed the Court of several discovery disputes. Because the fact discovery deadline is July 2, 2015 (Doc. No. 58 at 3), the Court issued an expedited briefing schedule for the resolution of all pending discovery disputes, and set a Discovery Hearing for June 5, 2015, at 10:00 a.m. (Doc. No. 85.) On June 2, 2015, Defense counsel informed the Court that the parties had resolved Defendant's two discovery issues and therefore, Defendant would not be filing a Discovery Motion. Also on June 2, 2015, Plaintiff filed a Motion to Compel Discovery. (Doc. No. 86.) On June 4, 2015, Defendant filed a Response to Plaintiff's Motion to Compel. (Doc. No. 91.)
On June 5, 2015, at 10:00 a.m., the Court held a Discovery Hearing. Mr. Jason Forge and Ms. Rachel Jensen appeared on behalf of Plaintiff. Ms. Nancy Stagg and Mr. Benjamin Morris appeared on behalf of Defendant. During the Discovery Hearing, the Court issued tentative rulings and due to the compressed time period before the close of fact discovery, ordered the parties to proceed in accordance with its tentative rulings.
During the depositions of Trump University's ("TU") former Controller, Mr. Steven Matejek, and TU's former President, Mr. Michael Sexton, Defendant did not allow questioning about who was responsible for paying the witnesses' attorneys' fees. Plaintiff believes this is an appropriate line of inquiry, as Defendant has directly or indirectly provided thousands, or tens of thousands, of dollars in benefits to witnesses in the form of paying for attorneys to represent them. (Doc. No. 86-1 at 8.) Defendant has now offered a stipulation that Defendant Trump and TU are paying Mr. Matejek's and Mr. Sexton's attorneys' fees. Plaintiff argues that the stipulation is not a replacement for asking questions about that subject during deposition. Because that line of questioning was foreclosed, Plaintiff seeks the opportunity to reopen both depositions and ask Mr. Matejek and Mr. Sexton about the payment of their attorneys' fees.
Plaintiff argues that the benefits the witnesses have received from Defendant in the form of attorneys' fees is relevant to show the witnesses' bias. (Doc. No. 86-1 at 9.) Plaintiff contends that, "the fact that a billionaire defendant may be providing thousands, or tens of thousands, of dollars in benefits to important witnesses is plainly the type of information that could induce bias, which makes it undeniably relevant." Id.
Further, Plaintiff argues that because Defense counsel's improper instructions not to answer questions during the depositions of Mr. Matejek and Mr. Sexton are the only reason that the depositions will be reopened and additional expenses will be incurred, Defendant should pay the price for its own discovery violations. (Doc. No. 86-1 at 21.) Plaintiff contends that Defendant should pay all reasonable costs for the next sessions of Mr. Matejek and Mr. Sexton's depositions. Id. Otherwise, he argues, it will be Plaintiff, not Defendant, who will be punished for Defense counsel's improper instructions not to answer. Id.
Further, although the fact discovery deadline is July 2, 2015, Plaintiff asks the Court to extend the deadline for the sole purpose of allowing the depositions of Mr. Matejek and Mr. Sexton to take place by July 16, 2015.1 (Doc. No. 86-1 at 22.)
Before Plaintiff filed his Motion to Compel, Defendants offered to stipulate that Defendant Trump and TU are paying Mr. Matejek's and Mr. Sexton's attorneys' fees. Plaintiff rejected that stipulation. Defendant now cautions the Court that Plaintiff seeks to reopen the depositions of Mr. Matejek and Mr. Sexton for an unlimited purpose, and not simply to inquire about the payment of attorneys' fees or the fee arrangements. Defendant notes that Plaintiff argues in his Motion to Compel that, "[b]ecause the bias such benefits induces may extend to all subjects [of testimony], the Matejek and Sexton depositions should be reopened with no restrictions on the areas of inquiry . . ." (Doc. No. 91; quoting Doc. No. 86-1 at 11.) Defendant asserts that Plaintiff wants another bite at the apple as to topics already covered, or that could have been covered, in prior testimony. Id. Defendant argues that Plaintiff should not be allowed to reopen the depositions for an unlimited purpose under these circumstances. Id.
Defendant argues that it should not have to pay for additional depositions because his positions in these discovery disputes have been substantially justified, and Plaintiff has flatly rejected all of Defendant's compromise proposals. (Doc. No. 91 at 14.) Defendant also argues that the fact discovery cutoff should not be extended, even for limited purposes. Id. at 15.
Generally the attorney-client privilege "does not safeguard against the disclosure of either the identity of the fee-payer or the fee arrangement." Ralls v. U.S., 52 F.3d 223, 225 (9th Cir. 1995) (citing In re Grand Jury Proceedings (Goodman), 33 F.3d 1060, 1063 (9th Cir. 1994); see also In re Osterhoudt, 722 F.2d 591, 593 (9th Cir. 1983) (); In re Michaelson, 511 F.2d 882, 888 (9th Cir. 1975) (); U.S. v. Blackman, 72 F.3d 1418, 1424 (9th Cir. 1995) ().
A court may impose an appropriate sanction, including reasonable expenses and attorneys' fees that are incurred by any party, on a person who impedes, delays, or frustrates the fair examination of the deponent. Fed. R. Civ. P. 30(d)(2). There are few situations where an instruction not to answer a deposition question is appropriate. Brincko v. Rio Props., Inc., 278 F.R.D. 576, 581 (D. Nev. 2011). A person may instruct a deponent not to answer only when necessary to preserve a privilege, toenforce a limitation ordered by the court, or to present a motion under Rule 30(d)(3). Fed R. Civ. P. 30(c)(2).
The court may order depositions to be taken a second time and order the cost be borne by the party whose counsel's conduct necessitated retaking the deposition. Brincko, 278 F.R.D at 581; O'Brien v. Amtrak, 163 F.R.D. 232, 236 (E.D. Pa. 1995). Because there are many instances where a party taking a deposition may ask a question that a deponent or counsel considers improper but is unable to show it was asked in bad faith, or to annoy, embarrass or harass the witness, the court should evaluate on a case-by-case basis. Brincko, 278 F.R.D at 584.
An award of expenses against an attorney advising a deponent not to answer is proper when the attorney's advice is not justified. Rockewell Intern., Inc. v. Pos-A-Traction Industries, Inc., 712 F.2d 1324 (9th Cir. 1983). An attorney can fail to meet the standard imposed by the Federal Rules of Civil Procedure to deal fairly and sincerely with the court and opposing counsel to conserve time and expense resulting in an "unreasonable and vexatious delay." City of New York v. Coastal Oil New York, Inc., No. 96 Civ. 8667 (RPP), 2000 WL 97247, at *2.
Even negligent failure to allow reasonable discovery may be punished. See Lew v. Kona Hosp., 754 F.2d. 1420, 1426 (9th Cir. 1985); see also Marquis v. Chrysler Corp., 577 F.2d 624, 642 (9th Cir.1978). "In view of the range of sanctions available, even negligent failures to allow reasonable discovery may be punished." Marquis, at 642.
Courts can order the payment of fees for any costs arising out of the discovery misconduct. See Raygoza v. City of Fresno, 297 F.R.D. 603, 607-10 (2014)(ordering payment of attorneys' fees, expert witness fees, court reporter fees, and costs the attorney incurred traveling to and from the deposition that did not take place); see F.C.C. v. Mizuho Medy Co. Ltd., 257 F.R.D. 679 (S.D. Cal. 2009)(because plaintiff caused the need to continue the deposition of corporate designee, plaintiff bears thecosts of resuming the deposition and must reimburse defendant for roundtrip train fare and for attorney's travel time to the second deposition).
The Court agrees with Plaintiff that with respect to Mr. Matejek and Mr. Sexton, the identity of the fee-payer is not protected by the attorney-client privilege, and therefore, Defendant improperly foreclosed this line of questioning during both depositions. It is clear from Defendant's Opposition that Defendant agrees he should not have instructed the witnesses not to answer. As Defendant himself implicitly acknowledged in previous depositions of other witnesses, there was no objection to those questions, nor should there have been. The source of attorneys' fees is not privileged information. Although a stipulation may be appropriate in some circumstances to cure a party's mistake, this is not one of those times. The Court agrees that Plaintiff should not be forced to rely on a stipulation that Defendant and TU are paying the witnesses' attorneys' fees. Pla...
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