Le v. The Cheesecake Facto

• Court: Court of Appeals for the Fifth Circuit
• Decided: March 6, 2007
• Docket: 06-20006
• Status: Unpublished

Opinion

United States Court of Appeals Fifth Circuit F I L E D IN THE UNITED STATES COURT OF APPEALS March 6, 2007

FOR THE FIFTH CIRCUIT Charles R. Fulbruge III Clerk

No. 06-20006

DAVID LE, Individually, doing business as Image Nail & Facial CHUAN LE, Individually, doing business as Image Nail & Facial, Individually

Plaintiffs - Appellants

v.

THE CHEESECAKE FACTORY RESTAURANTS INC

Defendant - Appellee

Appeal from the United States District Court for the Southern District of Texas, Houston No. 4:03-CV-5713

Before KING, WIENER, and OWEN, Circuit Judges.

PER CURIAM:*

Plaintiffs-appellants David Le and Chuan Le, individually

and doing business as Image Nail and Facial, appeal the district

court’s denial of their initial Rule 36(b) motion and a

subsequent amended Rule 36(b) motion to permit withdrawal of

deemed admissions and the subsequent summary judgment dismissal

of their negligence claim in favor of defendant-appellee The

* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4. Cheesecake Factory Restaurants, Inc. For the following reasons

we AFFIRM the district court’s grant of Final Summary Judgment.

I. The Motions to Permit Withdrawal

The Cheesecake Factory Restaurants, Inc. (“CCF”) served

David Le and Chuan Le, individually and doing business as Image

Nail and Facial (collectively, “plaintiffs”), with requests for

admission on November 24, 2004. Plaintiffs did not respond to

the requests for admission within the time mandated by Federal

Rule of Civil Procedure 36 and they were therefore deemed

admitted pursuant to Rule 36. On January 12, 2005, CCF moved for

summary judgment based on the deemed admissions and,

alternatively, on no-evidence grounds.

On February 4, 2005, plaintiffs moved for an extension of

time to respond to CCF’s motion for summary judgment, which the

court granted. Next, on February 17, 2005, plaintiffs filed a

Motion to Permit Withdrawal of Deemed Admissions pursuant to Rule

36(b). Without addressing Rule 36(b)’s first requirement that

withdrawal serve the presentation of the case on its merits,

their motion, with supporting affidavits, explained that their

failure to respond to CCF’s request was not the result of neglect

or conscious indifference,1 but was a mistake in mail handling.

1 In supporting their motion for withdrawal with evidence that their failure to respond was not the result of conscious indifference or neglect, plaintiffs appear to have moved for relief under the Texas procedural standard rather than the federal standard. Under Texas procedure, permitting withdrawal of admissions is proper upon a showing of (1) good cause and (2)

2 Plaintiffs attached their responses to the requests for admission

as an exhibit.

Plaintiffs failed to include an answer for Request Number 10

when they attached their responses to their initial motion to

permit withdrawal. CCF noted this omission, as well as

plaintiffs’ failure to address Rule 36(b)’s first requirement, in

a March 8, 2005, reply opposing the initial motion to withdraw.

Nearly five months later, and just two days before the close of

discovery, plaintiffs filed a First Amended Motion to Permit

Withdrawal of Deemed Admissions on August 1, 2005, denying

Request Number 10. Plaintiffs offered no explanation for their

delay. Plaintiffs again failed to address Rule 36(b)’s first

requirement and instead offered that the failure to respond to

Request Number 10 was “inadvertent” and “not the result of

neglect or conscious indifference.”

The district court denied both the initial motion to permit

withdrawal and the subsequent amended motion to permit withdrawal

and granted Final Summary Judgment on the basis of the deemed

admissions on September 14, 2005. Plaintiffs now appeal the

district court’s denial of their two motions to permit withdrawal

and the subsequent summary judgment dismissal of their claim.

II. Withdrawal of Deemed Admissions

no undue prejudice. Wheeler v. Green, 157 S.W.3d 439, 442 (Tex. 2005). “Good cause” is established by showing that the failure involved was an accident or mistake and not intentional or the result of conscious indifference. Id.

3 Rule 36 provides that a party may serve any other party

written requests for admission of the truth of any matters within

the scope of Rule 26(b). FED. R. CIV. P. 36(a). The matter is

deemed admitted unless the party to whom the request is directed

serves the requesting party a written answer or objection within

thirty days after the service of the request. Id. Moreover,

“[a]ny matter admitted . . . is conclusively established unless

the court on motion permits withdrawal or amendment of the

admission.” FED. R. CIV. P. 36(b).

A district court’s decision to permit the withdrawal or

amendment of an admission is reviewed for abuse of discretion.

In re Carney, 258 F.3d 415, 419 (5th Cir. 2001). Although the

court has considerable discretion to permit withdrawal or

amendment, a deemed admission may only be withdrawn when the

moving party satisfies the conditions set forth in Rule 36(b).

American Auto. Ass’n v. AAA Legal Clinic, 930 1117, 1119 (5th

Cir. 1991); Carney, 258 F.3d at 419. Under Rule 36(b), “the

court may permit withdrawal or amendment when the presentation of

the merits of the action will be subserved thereby and the party

who obtained the admission fails to satisfy the court that

withdrawal or amendment will prejudice that party in maintaining

the action or defense on the merits.” FED. R. CIV. P. 36(b). And,

even when Rule 36(b)’s two-factor test has been satisfied, the

district court “still has discretion to deny a request to

withdraw or amend an admission.” Carney, 258 F.3d at 419.

4 Plaintiffs contend that the district court abused its

discretion in denying their two motions to permit withdrawal

after concluding that plaintiffs had not shown that permitting

withdrawal would advance the presentation of the merits of their

case, but that CCF had shown that permitting withdrawal would

cause it to be prejudiced. Plaintiffs argue that the district

court based its conclusions on improper criteria. Plaintiffs

assert that they satisfy Rule 36(b)’s two-factor test because the

denial of their two motions for withdrawal served to eliminate

all merit issues and that any prejudice suffered by CCF by

permitting withdrawal would be simply the need to proceed to

trial. They further urge that because they satisfy the two-

factor test, the district court necessarily abused its discretion

in denying withdrawal.

Plaintiffs overlook our decision in Carney in arguing for a

per se rule that once Rule 36(b)’s two-factor test is satisfied,

a court abuses its discretion if it then denies withdrawal.

Carney, 258 F.3d at 419; see also Covarrubias v. Five Unknown

INS/Border Patrol Agents, 192 F. App’x 247, 258 (5th Cir. 2006)

(per curiam) (unpublished). Although we agree with plaintiffs

that it is proper to consider whether denying withdrawal would

have the practical effect of eliminating any presentation of the

merits of the case in determining whether Rule 36(b)’s first

requirement is met, see, e.g., Hadley v. United States, 45 F.3d

1345, 1348 (9th Cir. 1995), this and other courts have not relied

5 solely on this factor in determining whether to permit

withdrawal. Even where the presentation of the merits of a case

would be eliminated, other factors considered are whether the

plaintiff has demonstrated that the merits would be served by

advancing evidence showing “the admission is contrary to the

record of the case,” or that the admission “is no longer true

because of changed circumstances or [that] through an honest

error a party has made an improvident admission.” N. La. Rehab.

Ctr. Inc. v. United States, 179 F.Supp. 2d 658, 663 (W.D. La.

2001) (quoting Ropfogel v. United States, 138 F.R.D. 579, 583 (D.

Kan. 1991)); accord Branch Banking & Trust Co. v. Deutz-Allis

Corp., 120 F.R.D. 655, 658-59 (E.D.N.C. 1988) (denying withdrawal

because the movants for withdrawal proffered “no affidavit,

verified pleading, or other evidence . . . to suggest the

admission, if left standing, would render an unjust result under

the law”). This circuit has also determined that a court acts

within its discretion in considering the fault of the party

seeking withdrawal, Pickens v. Equitable Life Assurance Soc., 413

F.2d 1390, 1394 (5th Cir. 1969),2 or its diligence in seeking

withdrawal, Covarrubias v. Five Unknown INS/Border Patrol Agents,

192 F. App’x 247, 248 (5th Cir. 2006) (per curiam) (unpublished).

2 We note that Pickens was decided before the 1970 amendments to Rule 36 and thus cannot be relied upon in its entirety.

6 Turning to Rule 36(b)’s second requirement, we agree with

plaintiffs that “[c]ourts have usually found that the prejudice

contemplated by Rule 36(b) relates to special difficulties a

party may face caused by a sudden need to obtain evidence upon

withdrawal or amendment of an admission.” American Auto., 930

F.2d at 1117. The Eighth Circuit has interpreted this standard

to not encompass the increased expenses caused by the need for

additional discovery to replace withdrawn admissions, Gutting v.

Falstaff Brewing Corp., 710 F.2d 1309, 1314 (8th Cir. 1983), and

other courts contemplating the standard have concluded that

merely having to prove the matters admitted does not constitute

prejudice. No. La. Rehab. Ctr., 179 F.Supp. 2d at 663. Courts

have also considered, however, within the prejudice analysis, the

timing of the motion for withdrawal as it relates to the

diligence of the party seeking withdrawal and the adequacy of

time remaining for additional discovery before trial. See, e.g.,

Branch Banking & Trust Co., 120 F.R.D. at 660 (denying withdrawal

where party, with due diligence, could have accessed the

information needed to respond to request for admissions yet had

failed to do so); No. La. Rehab. Ctr., 179 F.Supp. 2d at 663

(permitting withdrawal when party obtaining the admissions failed

to show that it would not be able to present alternative evidence

and adequate time remained before trial to conduct limited

discovery).

7 The district court may have acted within its discretion in

denying plaintiffs’ initial February 17, 2005, Motion to Permit

Withdrawal of Deemed Admissions. As the court noted, although

denying withdrawal would eliminate the presentation of the merits

of plaintiffs’ case, plaintiffs entirely failed to address Rule

36(b)’s first requirement and did not support their motion with

any argument or information related to the merits of the case.

See N. La. Rehab. Ctr. Inc., 179 F.Supp. 2d at 663; Coca-Cola

Bottling Co v. Coca-Cola Co., 123 F.R.D. 97, 103 (D. Del. 1988);

Branch Banking & Trust Co., 120 F.R.D. at 658-59. A more complex

question is whether the court abused its discretion in

determining that plaintiffs had not acted with diligence as of

February 17, 2005, when they filed this initial motion. And,

given that discovery did not close until August 3, 2005, the

court may have abused its discretion in denying withdrawal when

CCF had almost six months to continue discovery and its prejudice

at that point in time consisted largely of the additional expense

of discovery. See Gutting, 710 F.2d at 1314; N. La. Rehab. Ctr.

Inc., 179 F.Supp. 2d at 663.

We need not resolve whether the district court abused its

discretion in denying plaintiffs’ initial motion to permit

withdrawal because it is clear from the distinct circumstances

surrounding plaintiffs’ subsequent First Amended Motion to Permit

Withdrawal that the court did not abuse its discretion in denying

the amended motion. Summary judgment is proper on the basis of

8 that denial alone. Although plaintiffs had notice that they had

not responded to Request Number 10 on March 8, 2005, they did not

seek to withdraw this admission until nearly five months later

and did so just two days before the close of discovery. They

offered no explanation for their delay. Further, plaintiffs

again failed to address Rule 36(b)’s first requirement——even

after being apprised of Rule 36(b)’s standard by CCF’s reply——and

instead offered simply that “the failure to provide a response to

that one single request was inadvertent, and the result of an

accident and mistake in the preparation of responses to all other

requests, and not the result of neglect or conscious

indifference.” Given plaintiffs’ failure to present any argument

or information showing that the presentation of the merits of

their case would be served by allowing withdrawal, see, e.g., N.

La. Rehab. Ctr. Inc., 179 F.Supp. 2d at 663, their lack of

diligence in moving for withdrawal of Request Number 10, see,

e.g., Covarrubias, 192 F. App’x at 248, and the fact that they

moved for withdrawal just two days before the close of discovery,

see, e.g., Branch Banking & Trust Co., 120 F.R.D. at 660, the

court did not abuse its discretion in denying plaintiffs’ First

Amended Motion to Permit Withdrawal.

III. Summary Judgment

The district court properly granted summary judgment to CCF

on the basis of the deemed admission of Request Number 10. This

9 court reviews grants of summary judgment de novo, applying the

same standards as the district court. Armstrong v. Am. Home

Shield Corp., 333 F.3d 566, 568 (5th Cir. 2003). Summary

judgment is proper when there is no genuine issue regarding any

material fact and the moving party is entitled to judgment as a

matter of law. FED. R. CIV. P. 56(c). Facts are material if they

might affect the outcome of the lawsuit under the governing law.

Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986). Under

Texas substantive law, a claim for negligence requires the

plaintiff to show that (1) the defendant owed a legal duty to the

plaintiff, (2) the defendant breached the duty, and (3) the

breach proximately caused the plaintiff’s injuries. Van Horn v.

Chambers, 970 S.W.2d 542, 544 (Tex. 1998).

“Rule 36 allows litigants to request admissions as to a

broad range of matters, including ultimate facts, as well as

applications of law to fact.” Carney, 258 F.3d at 419. Rule

36(b) provides that any matter admitted is “conclusively

established.” FED. R. CIV. P. 36(b). Rule 56(c), in turn,

provides that admissions on file are an appropriate basis for

granting summary judgment. FED. R. CIV. P. 56(c). Although we

have recognized the “potential harshness” of granting summary

judgment on the basis of default admissions, we have also

emphasized that compliance with the rules of procedure is

“necessary to insure the orderly disposition of cases.” Carney,

258 F.3d at 421 (quoting United States v. Kasuboski, 834 F.2d

10 1345, 1350 (7th Cir. 1987)). By failing to respond to Request

Number 10, plaintiffs admitted that “[t]he Houston Galleria’s

failure to exercise reasonable care in the maintenance of the

drainpipe was the sole proximate cause of the rupture of the

drainpipe alleged in the Complaint.” Accordingly, summary

judgment is proper in this negligence claim on the basis of

Request Number 10 because plaintiffs assign sole responsibility

for causation to the Houston Galleria.

We further conclude that summary judgment is proper in this

case regardless of whether the deemed admissions are permitted to

be withdrawn. CCF moved for summary judgment based on the deemed

admissions, and alternatively, on no-evidence grounds. Although

the district court did not rule on the no-evidence ground,

“[s]ummary judgment must be affirmed if it is sustainable on any

legal ground in the record, and it may be affirmed on grounds

rejected or not stated by the district court.” S & W Enters.,

L.L.C. v. Southtrust Bank of Ala., N.A., 315 F.3d 533, 537-38

(5th Cir. 2003) (internal citations omitted).

On summary judgment, the moving party is not required to

negate the nonmoving party’s claims or present evidence proving

the absence of a material fact issue; rather, the moving party

may meet its burden by simply “pointing to an absence of evidence

to support the nonmoving party’s case.” Armstrong, 333 F.3d at

568; see also Celotex, 477 U.S. at 323 (finding “no express or

11 implied requirement in Rule 56 that the moving party support its

motion with affidavits or other similar materials negating the

opponent’s claim”). Once the moving party files a properly

supported motion for summary judgment, the burden then shifts to

the non-moving party to “set forth specific facts showing that

there is a genuine issue for trial.” FED. R. CIV. P. 56(e).

Summary judgment will be granted where the nonmovant is unable to

point to any evidence in the record that would sustain a finding

in the nonmovant’s favor on any issue on which he bears the

burden of proof at trial. See Celotex, 477 U.S. at 322-24.

The record demonstrates that plaintiffs offered no competent

summary judgment evidence below that would sustain a finding in

favor of their negligence claim. Their February 17, 2005, reply

to CCF’s motion for summary judgment argued that summary judgment

was not proper because the admissions should be withdrawn and the

no-evidence ground for summary judgment was premature because

discovery would not conclude until August 3, 2005. The response

did not identify any material fact issues in dispute. Plaintiffs

filed an amended reply on May 31, 2005, without leave of court,

attaching their overdue responses to CCF’s interrogatories and

asserting that the responses established genuine issues of

material fact precluding summary judgment. Plaintiffs did not

identify which responses created material fact issues. Moreover,

the court denied plaintiffs’ motion to extend time to file the

12 amended reply and plaintiffs do not challenge this ruling on

appeal.

Finally, plaintiffs filed a motion to extend time to file a

second amended reply to CCF’s motion for summary judgment on

August 1, 2005, attaching an affidavit from their proposed expert

that they contend established genuine issues of material fact.

The district court’s ruling, however, both barred the proposed

expert’s affidavit and denied plaintiffs’ motion to extend time

to file the second amended reply. On appeal, plaintiffs do not

challenge the district court’s rulings regarding their second

amended reply. Furthermore, plaintiffs do not address the no-

evidence ground for summary judgment on appeal. As such, summary

judgment is proper because plaintiffs have entirely failed to

point to any evidence in the record that would sustain a finding

in their favor on the issues on which they bear the burden of

proof at trial. See Celotex, 477 U.S. at 322-24.

IV. CONCLUSION

For the foregoing reasons, the Final Summary Judgment

entered by the district court is AFFIRMED.