Antero Resources Corporation v. Tejas Tubular Products, Inc.

District Court, S.D. Ohio·Decided June 11, 2021·No. 2:19-cv-00804·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF OHIO EASTERN DIVISION

ANTERO RESOURCES CORPORATION,

Plaintiff,

v. Civil Action 2:19-cv-804 Judge Sarah D. Morrison Magistrate Judge Kimberly A. Jolson

TEJAS TUBULAR PRODUCTS, INC., et al.,

Defendants.

OPINION AND ORDER This matter is before the Court on Defendant Tejas Tubular Products, Inc’s (“Tejas”) Motion for Leave to Designate Non-Retained Expert. (Doc. 66). For the reasons that follow, Defendant’s Motion is GRANTED in part and DENIED in part. Specifically, the Court finds that good cause exists to modify the expert disclosure deadline. Accordingly, Defendant’s request for leave to disclose Mr. Ken Malloy as an expert witness is GRANTED. Because, however, the Court finds that Mr. Malloy is a specially retained expert under Rule 26(a) of the Federal Rules of Civil Procedure, Defendant’s request to designate Mr. Malloy as a non-retained expert is DENIED. Additionally, the parties are ORDERED to file a joint status report within fourteen (14) days of the date of Mr. Malloy’s deposition regarding discovery. I. BACKGROUND This case is about an allegedly defective piece of fracking equipment. On March 8, 2017, Plaintiff Antero Resources Corporation (“Antero”) prepared to frack a well in Noble County, Ohio. (Doc. 1, ¶¶ 29–30). Just ten minutes into pressure testing, the production casing on the well split. (Id.). Plaintiff alleges that a product defect caused the the split, resulting in over three million dollars in damages. (Id., ¶ 31). Following the incident, the casing’s suppliers, Defendants Ken Miller Supply, Inc. and Ken Miller Supply of West Virginia, Inc. (collectively, “KMS”) paid Plaintiff $1.2 million, a fraction of the alleged damages. (Doc. 1, ¶ 32). Additionally, KMS and the casing’s manufacturer, Defendant Tejas, allegedly agreed to have their insurance carriers investigate the well split’s cause. (Id., ¶¶ 32–33). Plaintiff alleges it is entitled to additional damages and that Defendants did not follow through on their agreement. (Id., ¶¶ 33–34). Plaintiff thus sued Defendants for breach of warranty and products liability. (See generally Doc. 1). The instant discovery dispute involves a December 2017 investigative report on the cause of the alleged casing failure. After the incident, Defendant Tejas’ insurance carrier, First Specialty Insurance Company (“First Specialty”) hired Ken Malloy, an engineer with Stress Engineering Services, Inc. (“SES”) to investigate and opine on the cause of the casing split. (See Docs. 68-1; 69-2). SES initially declined the job because of a potential conflict of interest, but Plaintiff agreed to waive any conflict. (See Doc. 69-1). Mr. Malloy sent First Specialty the results of his “preliminary investigation” (“the Malloy Report”) on December 18, 2017. (See Doc. 66 at 7–38). Important here, Defendant Tejas says it did not know about the Report until much later. (See Doc. 66 at 2; see also id. at 5). Indeed, even after litigation ensued, the Report never made its way into Defendants’ or First Specialty’s case files. (See id.). As part of a January 2020 document production, however, Defendant Tejas produced copies of Mr. Malloy’s engagement letter (Doc. 68-1) and invoice (68-2). Roughly a year later, in January 2021, Plaintiff subpoenaed SES. (Doc. 68 at 2). Included in SES’s document production was the Malloy Report. (Id. at 3). Plaintiff produced the documents, including the Malloy Report, to Defendants on February 23, 2021. (Id.). Only then, says Defendant Tejas, did it learn about the Report. (Doc. 66 at 2). Defendant Tejas promptly asked Plaintiff whether it would consent to a motion seeking leave to designate Mr. Malloy as an expert witness. (Doc. 69-3 at 2). Plaintiff said no. (Id. at 1). The parties seemingly tabled this dispute because, the following week, they asked the Court to stay expert discovery to allow them to mediate. (Doc. 61). Following an unsuccessful mediation, the Court lifted the stay on May 3, 2021. (Doc. 64). It then set an expert discovery deadline of July 30, 2021, and a dispositive motion deadline of September 13, 2021. (Id.). Shortly thereafter, Defendant Tejas filed the instant Motion, seeking leave to designate Mr. Malloy as a non-retained expert. (Doc. 66). Defendant Tejas asserts that, although the expert disclosure deadline was June 1, 2020, it did not know about the Malloy Report until Plaintiff produced it in discovery. (See generally id.). Plaintiff challenges Defendant’s Motion on numerous grounds. It contends that it would be prejudiced by adding Mr. Malloy as an expert witness at this juncture. (See generally Doc. 68 at 1–9). It additionally objects to Defendant Tejas’ classification of Mr. Malloy as a “non-retained” expert, asserting that Mr. Malloy should be subject to the stricter disclosure requirements applicable to specially “retained” experts. (Id. at 9–12). For these reasons, Plaintiff believes Defendant Tejas should not be permitted to rely on Mr. Malloy as an expert. (See generally Doc. 68). Plaintiff also makes an alternative request: Should the Court grant Defendant leave, it should also reopen fact discovery to allow Plaintiff to question witnesses about Mr. Malloy’s findings. (Id. at 13). The Court expedited briefing on Defendant’s Motion, which is now ripe for consideration. (See Docs. 66–69). II. STANDARD Because the parties were required to disclose expert witnesses over a year ago, (see Doc. 29), Defendant Tejas must demonstrate good cause for its untimely request. See Fed. R. Civ. P. 16(b)(4) (“A schedule may be modified only for good cause and with the judge’s consent); see also Kassim v. United Airlines, Inc., 320 F.R.D. 451, 452 (E.D. Mich. 2017) (“When a court schedules a deadline for the expert disclosures, they must be made by that deadline.”). Where, as here, a party seeks to extend an expired deadline, “the Court’s assessment of ‘good cause’ focuses on ‘the moving party’s diligence in attempting to meet the case management order’s requirements.’” Smith v. T. Marzetti Co., No. 118CV00089GNSHBB, 2019 WL 4044024, at *3 (W.D. Ky. Aug. 27, 2019) (quoting Inge v. Rock Fin. Corp., 281 F.3d 613, 625 (6th Cir. 2002)) (applying good cause standard to motion for leave to disclose an expert witness after the deadline). Five factors are useful to assessing Defendant Tejas’ diligence: (1) when Defendant learned of the discovery at issue; (2) how the discovery would affect the ruling below; (3) the length of the discovery period; (4) whether Defendant was dilatory; and (5) whether Plaintiff was responsive to discovery requests. Gatza v. DCC Litig. Facility, Inc., 717 F. App’x 519, 521 (6th Cir. 2017) (citing Bentkowski v. Scene Magazine, 637 F.3d 689, 696 (6th Cir. 2011)). In addition to Defendant’s diligence, the Court also considers “possible prejudice” to Plaintiff. T. Marzetti Co., 2019 WL 4044024, at *3 (citing Inge, 281 F.3d at 625). Importantly, the decision to modify a scheduling order is within the district Court’s discretion. Leary v. Daeschner, 349 F.3d 888, 909 (6th Cir. 2003). III. DISCUSSION The Court considers, as a threshold matter, whether there is good cause to extend the expert disclosure deadline. If so, the Court will then decide how to properly classify Mr. Malloy under Rule 26 of the Federal Rules of Civil Procedure. A. Good Cause As explained, D

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Antero Resources Corporation v. Tejas Tubular Products, Inc., (S.D. Ohio 2021).

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