May 25, 1994 UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
Nos. 93-1932 93-2001
RESOLUTION TRUST CORPORATION,
Plaintiff, Appellee,
v.
NORTH BRIDGE ASSOCIATES, INC., ET AL.,
Defendants, Appellants.
ERRATA SHEET
The order of the court issued on May 2, 1994 is corrected as follows:
On page 4, line 4, change December 2, 1990 to December 20, 1990.
UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT
RESOLUTION TRUST CORPORATION, Plaintiff, Appellee,
NORTH BRIDGE ASSOCIATES, INC., ET AL., Defendants, Appellants.
APPEALS FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Edward F. Harrington, U.S. District Judge]
Before
Selya, Circuit Judge,
Bownes, Senior Circuit Judge,
and Stahl, Circuit Judge.
Peter S. Brooks, with whom Brooks & Lupan was on brief, for
appellants. Joseph F. Shea, with whom Michael P. Condon, Sheila Kraft
Budoff, Paul R. Gupta and Nutter, McClennen & Fish were on brief,
for appellee.
May 2, 1994
SELYA, Circuit Judge. In one corner, the plaintiff, a SELYA, Circuit Judge.
government agency, having won by a knockout in the court below,
asserts that this is a case about defendants who demand their own
timetable for pretrial discovery and motion practice. In the
other corner, a group of defendants, having been laid low by what
they claim was a rabbit punch, assert that this is a case about
the government flouting court-imposed deadlines and procedural
rules. After reconstructing the chronology of events, we
conclude that the defendants are substantially correct. We also
conclude that the district court, instead of hurrying to grant
summary judgment, should have held the government accountable for
the lack of punctual discovery and given the government's
litigation adversaries a fair opportunity to formulate their
opposition.
I. THE VIEW FROM RINGSIDE
At the height of a boom market in real estate, two
neophytes, Ralph H. Scott, II, a physician, and his wife, Betty,
decided to build a large, expensive residential subdivision on
the picturesque island of Martha's Vineyard. In order to
proceed, Dr. and Mrs. Scott formed a corporation, North Bridge
Associates, Inc. The Scotts and North Bridge Associates
(collectively, "borrowers" or "appellants") then executed a note
in favor of ComFed Savings Bank ("ComFed" or "the bank") in the
amount of $2,995,000. The borrowers closed the loan on November
25, 1987, securing it by a mortgage on the North Bridge
subdivision. They also executed a construction loan agreement
that specified when and how the bank would disburse the borrowed
funds.
The venture experienced several setbacks. A
particularly vexing problem involved abutting property owners who
eventually served a lis pendens asserting that title defects
invalidated easements essential to the subdivision's viability.
At this delicate juncture, the bank shut off the flow of funds
and construction ground to a halt. When the promissory note
matured on November 25, 1988, the borrowers failed to repay the
outstanding balance. In a last-ditch effort to avert
foreclosure, they capitulated to ComFed's demands. As part of
the tribute that ComFed exacted for deferring the repayment
obligation, the borrowers signed an extension agreement and
general release surrendering all potential defenses and
counterclaims.1
The loan remained unpaid at the end of the extension
period. The bank then sued the borrowers in a Massachusetts
state court. The borrowers answered and counterclaimed alleging,
inter alia, that ComFed had broken its promises, violated an
implied covenant of good faith and fair dealing, disregarded
fiduciary responsibilities, and engaged in fraudulent
misrepresentation. They also asked the court to set aside the
1In the extension agreement, the borrowers represented that "no defenses, offsets, or counterclaims exist to the full payment of such indebtedness in accordance with its terms." In the general release, they purposed to discharge ComFed "of and from any and all debts, demands, action, causes of action, suits, accounts, covenants, and damages which North Bridge Associates, Inc. or its officers . . . may have or ever had . . . ."
extension agreement and general release on grounds of duress.
Inasmuch as procedural tussles have dominated the
course of this litigation, we deem it prudent to set forth a
detailed chronology of relevant events occurring from and after
the time that the parties joined issue. In doing so, we
eliminate many matters unimportant to our resolution of the
issues on appeal.2
1. December 20, 1990. The borrowers serve 1. December 20, 1990. interrogatories and a request for document production. In compliance with applicable procedural rules, see Fed. R. Civ. P. 34(b),
the request sets a reasonable time and place for production, specifying that the documents shall be produced within 30 days at the offices of the borrowers' lawyers.
2. January 23, 1991. Following ComFed's 2. January 23, 1991. failure, the Resolution Trust Corporation ("RTC"), having been appointed as conservator (and soon to be appointed receiver), is substituted as the party plaintiff and, on April 1, 1991, removes the action to the federal district court.
3. April 16, 1991. Over three months after 3. April 16, 1991.
2At the time the borrowers initiated discovery, the state court had jurisdiction and, accordingly, the borrowers' initial discovery requests were governed when made by the Massachusetts Rules of Civil Procedure. The action was soon removed to the federal district court. See Chronology, infra, at No.2. This
procedural wrinkle has no effect on our ensuing discussion for two reasons. First, removed cases are governed fully by the Federal Rules, and are treated no differently than if they had originated in a federal forum. See Fed. R. Civ. P. 81(c); see
also Granny Goose Foods, Inc. v. Brotherhood of Teamsters, 415
U.S. 423, 438 (1974). Second, the state's procedural rules parallel their federal counterparts in their relevant particulars. See, e.g., Mass. R. Civ. P. 34(b) (directing that
requests for document production "specify a reasonable time, place, and manner of making the inspection and performing the related acts"); Mass. R. Civ. P. 33(a) (allotting 45 days within which to answer interrogatories). For simplicity's sake, we cite only to the Federal Rules.
the date on which the plaintiff's discovery responses were due, RTC takes a first, tentative step toward responding: it offers to produce the described documents, but attempts unilaterally to amend the time and place for production. No documents are received and nothing is said with respect to the answers to interrogatories although, under the Federal Rules, the answers were due within 30 days of service, see Fed. R. Civ.
P. 33(b)(3).
4. May 26, 1992. After thirteen more months 4. May 26, 1992. without incident or action of any kind, the district judge holds a status conference. RTC agrees to provide all outstanding discovery "promptly."
5. February 22, 1993. RTC fritters away 5. February 22, 1993. another nine months. Eventually, the judge convenes a second status conference. This time, RTC comes armed with a motion for partial summary judgment ("the SJM").3 The judge orders all outstanding discovery obligations honored by March 24, at the latest.
6. March 2, 1993. As no progress has been 6. March 2, 1993. made toward completion of discovery, the borrowers file the first of three motions for enlargement of the time within which to oppose the SJM. The borrowers' motion is accompanied by an attorney's affidavit detailing the history of the action and noting that, more than two years after they should have been delivered, discovery materials are still in the pipeline.
7. March 18, 1993. RTC notifies the 7. March 18, 1993. borrowers that it has gathered some responsive documents, and suggests that the parties agree upon a mutually convenient time to review them.
8. March 25, 1993. Over RTC's objection, 8. March 25, 1993.
3The SJM addressed only count 1 of the complaint and the borrowers' several counterclaims. The remainder of the complaint, dealing principally with RTC's effort to reach and apply assets standing in the name of a related third party (himself a defendant), remains pending in the district court.
the district court grants the borrowers' motion and extends the time for opposing the SJM to April 16, 1993.
9. April 2, 1993. The interrogatories are 9. April 2, 1993. finally answered and, on the same date, the borrowers' attorneys review the documents that RTC has made available at its counsel's offices.
10. April 9, 1993. Some of the documents 10. April 9, 1993. originally requested on December 2, 1990, amounting to over 2,000 pages, are at long last delivered to the offices of the borrowers' lawyers, Peter and Cathy Brooks (who are husband and wife). On the same day, however, the Brooks' infant son is hospitalized and placed in an intensive care unit. He remains there, initially, for nine days, and is readmitted on April 20. Upon discharge three days later, he continues to require special attention.
11. April 12, 1993. The borrowers file a 11. April 12, 1993. motion in which they request a further enlargement of time until May 14, 1993. This motion is not accompanied by an affidavit, but, in an accompanying memorandum, Peter Brooks (who authored the affidavit in support of the first extension motion) describes the medical emergency and informs the court that the borrowers cannot intelligently address the SJM until they have time to review the compendious discovery materials produced only a few days earlier.
12. May 20, 1993. The borrowers conclude 12. May 20, 1993. their document review and find the documents produced to be incomplete and inadequate. They write to RTC's counsel specifying seventeen missing categories of documents and soliciting a conference to reduce areas of potential controversy.4 The ensuing
4The letter implicates a local rule that provides in pertinent part:
Before filing any discovery motion, including any motion for sanctions . . ., counsel for each of the parties shall confer in good faith to narrow the areas of disagreement to
discussion between the parties engenders no results.
13. May 24, 1993. The borrowers file their 13. May 24, 1993. third motion for an extension, accompanied by an affidavit from Cathy Brooks rehearsing the latest developments, stating her belief that the documents withheld exist, and opining that those papers, if produced, will illuminate genuine disputes concerning material facts.
14. June 15, 1993. The borrowers move to 14. June 15, 1993. compel production of the undisclosed documents.
15. July 20, 1993. Without giving notice or 15. July 20, 1993. holding a hearing, the district judge grants the SJM, rejects the borrowers' second and third extension motions, and denies the motion to compel. The court offers no meaningful explanation for any of its rulings. In due course, the court invokes Fed. R. Civ. P. 54(b) and enters judgment.
The borrowers appeal.5 They assert that the lower
court erred: in denying their second and third extension
motions; in taking up the SJM while discovery remained
incomplete, and without prior notice or a hearing; and in
granting the SJM despite the presence of genuine issues of
material fact.
II. THE RULE 56(f) PARADIGM
When a party claims an inability to respond to an
the greatest possible extent. It shall be the responsibility of counsel for the moving party to arrange for the conference. . . .
D. Mass. Loc. R. 37.1.
5For technical reasons related primarily to an abortive effort to secure reconsideration, the borrowers filed two notices of appeal. We need not distinguish between them.
opponent's summary judgment motion because of incomplete
discovery or the like, Fed. R. Civ. P. 56(f) looms large.6 Our
first task, therefore, is to erect the framework under which Rule
56(f) motions must be analyzed. We then proceed to a more
particularized discussion of the borrowers' motions and the
rulings with respect thereto. In performing this analysis, we
remain mindful that a district court's denial of a Rule 56(f)
motion is reviewed only for abuse of discretion. See Licari v.
Ferruzzi, F.3d , (1st Cir. 1994) [No. 93-2047, slip
op. at 16]; Nestor Colon Medina & Sucesores, Inc. v. Custodio,
964 F.2d 32, 38 (1st Cir. 1992).
A. The Applicable Framework.
Fed. R. Civ. P. 56(f) describes a method of buying time
for a party who, when confronted by a summary judgment motion,
can demonstrate an authentic need for, and an entitlement to, an
additional interval in which to marshal facts essential to mount
an opposition. See Paterson-Leitch Co. v. Massachusetts Mun.
Wholesale Elec. Co., 840 F.2d 985, 988 (1st Cir. 1988). The rule
6The rule reads:
Should it appear from the affidavits of a party opposing the motion [for summary judgment] that the party cannot for reasons stated present by affidavit facts essential to justify the party's opposition, the court may refuse the application for judgment or may order a continuance to permit affidavits to be obtained or depositions to be taken or discovery to be had or may make such other order as is just.
Fed. R. Civ. P. 56(f).
is intended to safeguard against judges swinging the summary
judgment axe too hastily. See Price v. General Motors Corp., 931
F.2d 162, 164 (1st Cir. 1991).
Consistent with the salutary purposes underlying Rule
56(f), district courts should construe motions that invoke the
rule generously, holding parties to the rule's spirit rather than
its letter. See United States v. One Lot of U.S. Currency
($68,000), 927 F.2d 30, 33-34 (1st Cir. 1991); Hebert v.
Wicklund, 744 F.2d 218, 222 (1st Cir. 1984). This does not mean,
however, that Rule 56(f) has no bite or that its prophylaxis
extends to litigants who act lackadaisically; use of the rule not
only requires meeting several benchmarks, see infra, but also
requires due diligence both in pursuing discovery before the
summary judgment initiative surfaces and in pursuing an extension
of time thereafter. In other words, Rule 56(f) is designed to
minister to the vigilant, not to those who slumber upon
perceptible rights. See Paterson-Leitch, 840 F.2d at 989.
Having traced the anatomy of the rule, we next add some
flesh to the bones. A litigant who desires to invoke Rule 56(f)
must make a sufficient proffer. In all events, the proffer
should be authoritative; it should be advanced in a timely
manner; and it should explain why the party is unable currently
to adduce the facts essential to opposing summary judgment. See
id. at 988. When, as is often the case, the reason relates to
incomplete discovery, the party's explanation must take a special
form: it should show good cause for the failure to have
discovered the facts sooner; it should set forth a plausible
basis for believing that specified facts, susceptible of
collection within a reasonable time frame, probably exist; and it
should indicate how the emergent facts, if adduced, will
influence the outcome of the pending summary judgment motion.
See id.
In the "delayed discovery" type of case, then, the
criterion for Rule 56(f) relief can be thought of as embodying
five requirements: authoritativeness, timeliness, good cause,
utility, and materiality. We have acknowledged that these
requirements are not inflexible and that district courts are
vested with considerable discretion in their administration. See
id. at 989. In the exercise of that discretion, one or more of
the requirements may be relaxed, or even excused, to address the
exigencies of a given case. When all five requirements are
satisfied, however, a strong presumption arises in favor of
relief. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250
n.5 (1986) (stating that summary judgment will be forestalled if,
and to the extent that, the nonmoving party "has not had the
opportunity to discover information that is essential to his
opposition"). Unless the movant has been dilatory, or the court
reasonably concludes that the motion is a stalling tactic or an
exercise in futility, it should be treated liberally. See 6
Moore's Federal Practice 56.24, at 797-800 (2d ed. 1993).
B. Analysis.
The main battleground between the parties is the
borrowers' third, and final, Rule 56(f) motion,7 which rested on
a claim of delayed discovery still outstanding. We proceed to
test this motion in the crucible of Rule 56(f).
1. Authoritativeness. Appellants accompanied their 1. Authoritativeness.
motion with an affidavit executed by Cathy Brooks. Reading the
rule literally and the case law carelessly, RTC asseverates that
the affidavit is defective because it is made by an attorney
rather than a party. This asseveration stems from misreading one
case, Hebert, 744 F.2d at 221 (a case that, contrary to RTC's
rendition of it, stands only for the proposition that an
undocketed letter from a lawyer is not a sufficient Rule 56(f)
proffer), and from ignoring a later case, Paterson-Leitch, 840
F.2d at 988 (a case in which we stated unequivocally that a Rule
56(f) proffer may acceptably take the form of "written
representations of counsel subject to the strictures of Fed. R.
Civ. P. 11").
This case floats comfortably within the safe harbor
contemplated by the Paterson-Leitch court. The affidavit is of
record and has been duly served on the opposing party. It is
signed by a person who possesses firsthand knowledge and who is
competent to address the specifics of the matters discussed. The
7The second extension motion sought a continuance through May 14, 1993, necessitated by a medical emergency. See
Chronology, supra, at No. 11. While that motion appears to have
been meritorious in the sense that a documented family illness precluded the borrowers from "presenting facts essential to justify [their] opposition," Fed. R. Civ. P. 56(f), the district court did not consider the motion in an expeditious fashion, and it was effectively superseded by the third motion. Hence, we train our sights on the latter target.
fact that the affiant is also the borrowers' attorney does not
undermine the proffer; after all, the borrowers themselves would
know the relevant particulars only through communications from
counsel. Since they could hardly speak either to the cause or
the effect of discovery delays, requiring that the supporting
affidavit be signed by them rather than by a lawyer would
mindlessly exalt form over substance. Attorney Brooks' affidavit
is, therefore, sufficiently authoritative.
2. Timeliness. RTC questions whether the Rule 56(f) 2. Timeliness.
motion was filed in a timely manner. We answer this query
affirmatively. There is no fixed time limit for filing a Rule
56(f) motion; that is, neither the Federal Rules nor the local
rules place any relevant restriction on the submission of such a
motion, at least when the court has not assigned a firm date for
a hearing on, or adjudication of, the opposing party's summary
judgment initiative.8
In the absence of an applicable time limit, we hold
that a party must invoke Rule 56(f) within a reasonable time
following receipt of a motion for summary judgment. It is, after
all, black letter law that when a rule requires an act to be
done, and does not specify a time for doing it, courts generally
8The only deadline that arguably might apply arises out of the requirement that affidavits opposing a motion for summary judgment must be submitted at least one day before the scheduled hearing on the motion. See Fed. R. Civ. P. 56(c); see also
Ashton-Tate Corp. v. Ross, 916 F.2d 516, 519-20 (9th Cir. 1990)
(discussing interface between Rules 56(c) and 56(f)). But that proviso has no application where, as here, a motion for summary judgment is decided on the papers, without oral argument or notice from the court of a cutoff date.
imply an obligation to perform the act within a reasonable
period. Under this rubric, courts regularly have grafted
"reasonable time" requirements onto otherwise silent federal
procedural rules in both the criminal and civil contexts. See,
e.g., Government of Virgin Islands v. Knight, 989 F.2d 619, 627
(3d Cir.) (collecting examples), cert. denied, 114 S. Ct. 556
(1993); Smith v. Bowen, 815 F.2d 1152, 1156 (7th Cir. 1987)
(applying judicially created reasonableness requirement to
determine timeliness of motion to amend judgment under Fed. R.
Civ. P. 54(d)); Brittain v. Stroh Brewery Co., 136 F.R.D. 408,
413 (M.D.N.C. 1991) (same, anent motion for protective order
under Fed. R. Civ. P. 26(c)); Titus v. Smith, 51 F.R.D. 224, 226
(E.D. Pa. 1970) (imposing reasonable time limit on filing of Fed.
R. Civ. P. 55(c) motion to remove entry of default).
Application of the reasonableness principle to this
case is straightforward. Given that the district court delayed
ruling on the first extension motion for several weeks before
allowing it, appellants had reason to wait until near the end of
what would have been the second extension period in the
expectation that the judge would rule momentarily on their second
extension motion. When the judge had not handed down a ruling by
the end of that interval, appellants promptly renewed their
motion, seeking a further extension. In the peculiar
circumstances of this case, we cannot say that the timing of the
third extension motion falls outside the realm of
reasonableness.9
3. Good Cause. Although RTC protests that the 3. Good Cause.
borrowers failed to show good cause, the facts belie this
protestation. RTC bases its argument on the faulty premise that
it complied fully with all outstanding discovery demands when it
cavalierly announced, more than three months after discovery
responses initially were due upon the borrowers' terms, that it
would deign to produce documents at a site and time of its
choosing.10 See Chronology, supra, at No. 3. We do not agree
that this ipse dixit was the functional equivalent of full
compliance with outstanding discovery requests.
The rules provide that interrogatories must be answered
within 30 days, see Fed. R. Civ. P. 33(b)(3), and RTC's offer
made no provision whatever for fulfilling that obligation. Of
9The absence of any satisfactory explanation by the judge as to why the second and third extensions were denied weighs heavily in our resolution of this issue. And that shortcoming is one of several factors that distinguish this case from Mendez v. Banco
Popular de Puerto Rico, 900 F.2d 4 (1st Cir. 1990), upon which
RTC pins its hopes. In contrast to the case at bar, Mendez
involved "a district court's reasoned refusal to grant
incremental enlargements of time." Id. at 7 (emphasis supplied).
Furthermore, Mendez did not implicate Rule 56(f) at all; rather,
the case concerned a motion for an enlargement of time under Fed. R. Civ. P. 6(b). See id. at 6. Finally, Mendez presented the
very different case of an attorney who, unlike the Brookses, repeatedly asked the court, without any good reason, to accommodate his personal schedule. See id. at 6-7. A petition
for a continuance is always suspect when it is within the power of the petitioner to alter the conditions that allegedly preclude him from acting within the allotted period of time.
10RTC proposed to effect production at the offices of its law firm and when "mutually convenient."
broader significance, the rules give the discovering party, not
the discovery target, the option of specifying the time, place,
and manner of production and inspection. See Fed. R. Civ. P.
34(b). Absent a court order or an agreement among the litigants,
a party from whom discovery is sought cannot unilaterally alter
these directives to suit its fancy. This verity has particular
force where, as here, the discovering party's notice limned an
entirely reasonable time/place/manner format for document
production.
In the final analysis, a movant's claim of good cause
must be viewed against the historical background of the
litigation. Here, RTC's dilatoriness over a three-year span
lends considerable worth to the "goodness" of the borrowers'
"cause." Although discovery was due and owing, RTC did nothing
for three months, then made a token gesture toward compliance,
then hibernated for the next thirteen months, and then, after
representing to the court that it would promptly set matters
straight, twiddled its corporate thumbs for another nine months.
It was only under the hammer of a court order that RTC took
significant, albeit incomplete, steps toward compliance; it
answered the interrogatories on April 2, 1993 (two weeks after
the court-imposed deadline and well over two years after the
answers were originally due) and it simultaneously effected
partial compliance with the request for document production.
This was too little and too late.
In what amounts to an effort at confession and
avoidance, RTC labors to shift the focus of our inquiry away from
its chronic disregard of procedural requirements. It says that
appellants contributed to the delay and, at any rate, that they
were lax in enforcing discovery deadlines. We are unimpressed by
this fingerpointing.
In comparison to RTC, the borrowers' contribution to
the litany of delay appears modest. RTC asserts, correctly, that
the borrowers waited two weeks before beginning inspection of the
initial batch of records, and that they then took from April 9 to
May 20 to review the documents delivered to their counsel's
office. On the whole, however, neither interval seems
unreasonable. The former period strikes us as no more than a
routine scheduling glitch and the latter period is largely
excused by the family illness documented in the second
continuance motion (and not disputed by RTC).
RTC's effort to place the blame for two lost years on
appellants' shoulders is disingenuous. When discovery is
appropriately initiated, the burden of compliance lies foremost
with the party from whom the discovery is sought. Of course, the
discovering party has the right to file a motion to compel under
Fed. R. Civ. P. 37, see R.W. Int'l Corp. v. Welch Foods, Inc.,
937 F.2d 11, 15-20 (1st Cir. 1991) (discussing mechanics of
motion practice under Rule 37), but this right is not an
obligation. Rule 37 contains no time limit, and, unless a
particular situation presents special circumstances suggesting
that concepts of waiver or estoppel should apply,11 a
discovering party's failure to invoke Rule 37 celeritously will
not excuse the guilty party's failure to furnish required
discovery in a timely manner. RTC's argument to the contrary is
reminiscent of an embezzler who seeks to avoid the consequences
of his defalcation by criticizing the victim as having been
careless with its funds or slow in reporting shortages to the
police.
We will not whip a dead horse. RTC has cited no case
in which a Rule 56(f) motion was denied on the ground that the
movant, having sought discovery expeditiously, then failed to
take heroic measures to enforce his rights against a recalcitrant
opponent. We decline to break new ground and set so odd a
precedent. While there are no model litigants here neither
side has done its utmost to advance the case we think that
under operative norms of litigation practice and the totality of
the extant circumstances, appellants' lassitude in moving to
compel did not excuse RTC's protracted dawdling.
Before leaving this topic, we offer a final
observation. With minor exceptions not relevant here, the
Federal Rules of Civil Procedure apply to the government as well
as to all other litigants. See United States v. Yellow Cab Co.,
11A handful of courts have denied Rule 37 motions as unreasonably late when brought on the eve of trial or under similar circumstances. See, e.g., Price v. Maryland Cas. Co.,
561 F.2d 609, 611 (5th Cir. 1977); Lapenna v. Upjohn Co., 110
F.R.D. 15, 18 (E.D. Pa. 1986); see also 4A Moore's Federal
Practice, supra, 37.02[6], at 47-48 (citing cases). These
cases, however, are inapposite.
338 U.S. 338, 341 (1949); EEOC v. Waterfront Comm'n of N.Y.
Harbor, 665 F. Supp. 197, 200 (S.D.N.Y. 1987). This tenet has
been endorsed with especial frequency in discovery disputes.
See, e.g., Campbell v. Eastland, 307 F.2d 478, 485 (5th Cir.
1962), cert. denied, 371 U.S. 955 (1963); Barrett v. Hoffman, 521
F. Supp. 307, 315 (S.D.N.Y. 1981) (collecting cases), rev'd on
other grounds, 689 F.2d 324 (2d Cir. 1982), cert. denied, 462
U.S. 1131 (1983). Indeed, because the government is rendered
uniquely powerful by its vast resources and statutory authority,
it has a special responsibility to abide by civil adjudicatory
rules. Here, RTC shirked this responsibility.
4. Utility. We next consider whether appellants 4. Utility.
presented a plausible basis for a belief that discoverable
materials exist that would likely suffice to raise a genuine
issue of material fact and, thus, defeat summary judgment. See
Nestor Colon, 964 F.2d at 38; Price, 931 F.2d at 164. For
purposes of achieving this benchmark, a Rule 56(f) proffer need
not be presented in a form suitable for admission as evidence at
trial, so long as it rises sufficiently above mere speculation.
See Carney v. United States, F.3d , (2d Cir. 1994)
[1994 U.S. App. LEXIS 5449 at *16]. This is as it should be, for
Rule 56(f) is best understood as a complement to other provisions
contained in Rule 56, allowing the opposing party to explain why
he is as of yet unable to file a full-fledged opposition, subject
to the more harrowing evidentiary standard that governs under
Rules 56(e) and 56(c).12 See 10A Charles Alan Wright, Arthur
R. Miller & Mary Kay Kane, Federal Practice & Procedure 2740,
at 530-31 (1987 & Supp. 1993).
We think that appellants' proffer passes the test of
utility. In the affidavit accompanying the motion, Cathy Brooks
states, among other things:
When I completed my review of documents that RTC did produce, I reviewed them with my client Betty Wells Scott . . . . Based in part upon her recollection, in part on my own experience with banks' procedures and record keeping with respect to construction loans, and in part on documents obtained through other sources, I have reason to believe that RTC has not produced all of the records requested.
RTC attacks this statement as inherently unreliable.
It draws analogies to two cases in which we discounted Rule 56(f)
proffers for vagueness. See Mattoon v. City of Pittsfield, 980
F.2d 1, 8 (1st Cir. 1992); Peterson-Leitch, 840 F.2d at 989. But
here, the proffer contained more than gauzy generalities; it
specified seventeen categories of materials requested but
withheld.
RTC also draws an analogy to Hebert, 744 F.2d at 220, a
case in which a Rule 56(f) affidavit was rejected partly because
it recounted the affiant's conversations with a third person. In
this case, however, although the Brooks affidavit refers to
12Although Rule 56 sets out stricter standards for materials offered on the merits of a summary judgment motion, see, e.g.,
Garside v. Osco Drug, Inc., 895 F.2d 46, 49-50 (1st Cir. 1990),
those standards do not apply to proffers under Rule 56(f). See
Carney, supra; see also Committee for First Amendment v.
Campbell, 962 F.2d 1517, 1522 (10th Cir. 1992).
conclusions drawn by a third person, the challenged reference
merely provides a partial basis for Brooks' good-faith belief.
Since Rule 56(f) requires a movant to spell out the reasons
underpinning the conclusion that further discovery would be
futile, and since the other bases for Attorney Brooks' belief
fell well within her personal knowledge, we are unprepared to say
that this brief reference spoiled the proffer. Accordingly,
appellants' motion satisfies the utility requirement.
5. Materiality. Conceding nothing, RTC also contests 5. Materiality.
the materiality of the facts that the borrowers wish to discover.
We think that materiality for purposes of Rule 56(f) means
material to the issues raised on summary judgment, and, hence,
the kind of additional discovery that will serve to vivify a Rule
56(f) motion is theoretically different from, and ordinarily will
be more restricted than, the kind of discovery generally
permitted under the Federal Rules. See First Nat'l Bank v.
Cities Serv. Co., 391 U.S. 253, 298 (1968). In short, the facts
that the movant seeks to discover must be foreseeably capable of
breathing life into his claim or defense. See Licari, F.3d
at [slip op. at 16]; Taylor v. Gallagher, 737 F.2d 134, 137
(1st Cir. 1984).
Evaluating the potential significance of unknown facts
in regard to unadjudicated issues is something of a metaphysical
exercise. Consequently, the threshold of materiality at this
stage of a case is necessarily low. Cf., e.g., United States v.
Agurs, 427 U.S. 97, 103 (1976) (explaining that a fact may be
material for some purposes as long as there is "any reasonable
likelihood" that it could affect the outcome). Appellants'
proffer crosses that threshold.
It cannot be gainsaid that the issues raised in the
complaint, answer, and counterclaims are complicated. The issues
raised in the SJM mirror this complexity. In an effort to cut
through the legal tangle, we parse the premises on which the SJM
rests and contrast them with appellants' prospective
counterarguments.
RTC insists that appellants' defenses and counterclaims
are entirely barred by reason of (i) the provisions contained in
the extension agreement and general release, see supra note 1,
(ii) the mandate of 12 U.S.C. 1823(e), and/or (iii) the D'Oench
doctrine, see D'Oench, Duhme & Co. v. FDIC, 315 U.S. 447 (1942).
The borrowers resist this onslaught by positing (i) that the
extension agreement and general release are products of duress,
and, hence, void (or voidable); and (ii) that claims based on
violations of the plain terms of an agreement that itself
comports with the requisites of section 1823 and the D'Oench
doctrine are not barred.
In respect to this last assertion, the borrowers
maintain that further discovery will prove ComFed violated the
plain terms of the construction loan agreement in that it
disbursed loan proceeds improperly by (i) paying contractors
directly, without authorization, (ii) paying for work never
completed, (iii) paying for substandard work, and (iv) paying for
work that deviated from the construction plans. The allegedly
discoverable facts bear directly on the applicability of section
1823(e) and the D'Oench doctrine. They also bear, albeit perhaps
less obviously, on the question of duress (and, hence, on the
enforceability of the extension agreement and general release)
because duress in this type of setting requires proof that the
coercing party caused the financial plight of the coerced party.
See International Underwater Contractors, Inc. v. New England
Tel. & Tel. Co., 393 N.E.2d 968, 970 (Mass. App. Ct. 1979).
We do not believe it is either necessary or desirable
for a court to attempt to probe sophisticated issues on an
undeveloped record. If, at this stage of the proceedings, a lack
of materiality is not apparent, then an inquiring court should
err, if at all, on the side of liberality. See $68,000, 927 F.2d
at 33-34; Paterson-Leitch, 840 F.2d at 988; Hebert, 744 F.2d at
222; see also Slagle v. United States, 228 F.2d 673, 678 (5th
Cir. 1956) (discussing perceived need for courts "to exercise a
spirit of liberality" under Rule 56(f)); 10A, Federal Practice &
Procedure, supra, 2740, at 532; id. 2741, at 550-51. Since
we cannot say that appellants' merits-related arguments are
plainly unmeritorious,13 and since the sought-after discovery
13In a post-argument submission, RTC proclaims that the very recent case of Capizzi v. FDIC, F. Supp. (D. Mass. 1994)
[No. 90-12775-S] sounds the death knell for the claim of duress. We do not agree. Capizzi concluded that a lender's threat to
foreclose could not constitute duress because the borrower had the option of vigorously defending against the foreclosure action. In this case, it is not clearly established that the borrowers had such an option, for Mrs. Scott suggests in her affidavit that she had no knowledge of her potential defenses at
pertains closely to the underpinning for those arguments, the
Rule 56(f) motion passes the materiality test.
C. Synthesis.
We have now established, perhaps at greater length than
necessary, that appellants' motion satisfies the strictures of
Rule 56(f). And though we leave open the possibility that a
court may deny even a facially valid Rule 56(f) motion in
appropriate circumstances, the aspects of the situation here
militate strongly in favor of granting a continuance.
In the first place, the facts needed to oppose summary
judgment are in RTC's exclusive control. This is a circumstance
that can assume decretory significance. See Hebert, 744 F.2d at
222 n.4 (suggesting that, once the benchmarks for a valid proffer
are met, "continuances should be routinely granted under Rule
56(f) where the moving party has sole possession of the relevant
facts"). In the second place, the incompleteness of discovery is
RTC's fault. When litigants spar over Rule 56(f), fault packs a
considerable wallop in inscribing the scorecard. See Sames v.
Gable, 732 F.2d 49, 51 (3d Cir. 1984) (explaining that, when
reasonably diligent efforts to obtain evidence from the summary
judgment proponent have been thwarted, continuances "should be
granted almost as a matter of course"); see also International
Shortstop, Inc. v. Rally's, Inc., 939 F.2d 1257, 1267 (5th Cir.
the time she signed the extension agreement and general release. Thus, even assuming that Capizzi is good law of general
applicability a matter on which we take no view it is not necessarily controlling.
1991), cert. denied, 112 S. Ct. 936 (1992). When Rule 56(f)
functions properly, it ensures that, in the mine-run of cases, a
litigant who fails to answer potentially relevant discovery
requests on schedule will be unable to demand summary judgment
until after he remedies his failure. See Bane v. Spencer, 393
F.2d 108, 109 (1st Cir. 1968), cert. denied, 400 U.S. 866 (1970);
see also 10A Federal Practice Procedure, supra, 2741, at n.2
(collecting cases holding that a grant of summary judgment with
discovery outstanding constitutes clear error).
Giving these additional factors due weight, and
considering the record as a whole, we conclude without serious
question that the court below abused its discretion in denying
the borrowers' third Rule 56(f) motion. See United States v.
Roberts, 978 F.2d 17, 21 (1st Cir. 1992) (explaining that a
district court abuses its discretion, inter alia, when it
"commits a palpable error of judgment").
III. CONCLUSION
We need go no further.14 In civil as in criminal
litigation, the government may strike forceful blows, so long as
they are struck within the rules. Here, the government went too
far, frustrating appellants' legitimate discovery initiatives by
14In light of our finding that the court below improvidently denied a further continuance to the borrowers, we have no occasion to reach, and express no opinion upon, the remaining assignments of error. We deem it appropriate to mention, however, that, contrary to the borrowers' suggestion, this circuit has approved, in appropriate circumstances, the adjudication of summary judgment motions on the papers, i.e.,
without oral argument. See, e.g., Cia. Petrolera Caribe, Inc. v.
Arco Caribbean, Inc., 754 F.2d 404, 411 (1st Cir. 1985).
playing keepaway. The district court should not have
countenanced, much less rewarded, such dubious conduct.
The order denying relief under Rule 56(f) is reversed,
the judgment below is vacated, and the cause is remanded to the
district court for further proceedings. Costs to appellants.