Wright v. Old Gringo, Inc.

Opinion

2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 MARSHA WRIGHT, Case No.: 17cv1996-BAS (MSB)

12 Plaintiff, ORDER DENYING PLAINTIFF’S EX PARTE 13 v. MOTION TO AMEND THE SCHEDULING ORDER 14 OLD GRINGO, et al.,

15 Defendants. [ECF NO. 209] 16 17 Before the Court is Plaintiff’s “Ex Parte Motion to Amend Scheduling Order and 18 Extend or Vacate Remaining Pretrial and Trial-Related Deadlines and Dates” (“Instant 19 Motion”), filed on January 8, 2020. (See ECF No. 209.) Defendants filed their 20 Opposition on January 9, 2020. (ECF No. 210.) The Court finds this motion suitable for 21 ruling on the papers pursuant to Civil Local Rule 7.1 (d). For the reasons discussed in 22 this Order, the Court DENIES Plaintiff’s motion. 23 I. RELEVANT FACTUAL AND PROCEDURAL BACKGROUND 24 Plaintiff, a former designer for Defendants Old Gringo, Inc. (“OGI”) and Old 25 Gringo, S.A. de C.V. (“OGS”) (a Western wear manufacturer and distributor and its 26 Mexican sister company, together the “Old Gringo Companies”) alleges that the 27 principles and officers of the Old Gringo Companies, Defendants Ernest Tarut (“Tarut”) 2 conveyed. (See ECF No. 1.) This basic allegation underlies the remaining causes of 3 action in this case. 4 This case was filed on September 28, 2017. (ECF No. 1.) The first scheduling 5 order was issued on March 2, 2018 by Magistrate Judge Stormes, who was then the 6 magistrate judge handling this case. (ECF No. 18.) Judge Stormes then set the fact and 7 expert discovery deadline for October 15, 2018. (Id. at 2.) Judge Stormes issued a First 8 Amended Scheduling Order on September 27, 2018, wherein she continued the 9 deadline for the completion of the depositions identified by the parties to December 14, 10 2019. (ECF No. 33 at 3.) 11 Even though discovery in this case closed on October 15, 2018, this Court has 12 spent significant time and patience over the last thirteen months resolving the parties’ 13 persistent discovery disputes. (See, e.g., ECF Nos. 49, 56, 68, 70, 72, 77, 78, 80, 82, 83, 14 85, 86, 87, 92, 93, 99, 100, 108, 112, 113, 140, 141, 154, 159, 164, 166, 171, 174, 175, 15 176, 177, 179, 186, 191, 194, 195, 199, 201, 202, 205, 206, 208 and 219.) A large part of 16 this time was spent addressing Plaintiff’s motions to compel further responses to 17 production of documents from Defendant OGI, primarily regarding the finances of both 18 OGI and OGS and a protective order to facilitate that exchange of documents. (See, e.g., 19 ECF Nos. 58, 73, 78, 85, 90, 92, 94, 100, 121, 127, 128, 129, 159, 175, 180, and 194.) 20 At the same time, this case was being litigated through motions before the 21 District Court. Having been served late in the proceedings, (see, e.g, ECF No. 33 at 3 22 (OGS had not been served on September 27, 2018)), OGS first specially appeared in the 23 case on December 10, 2018, when it filed a “Motion to Quash Service of Summons for 24 Lack of Personal Jurisdiction or, in the Alternative, to Stay or Dismiss the Action of the 25 Ground of Forum Non Conveniens.” (See ECF No. 61.) Judge Bashant denied that 26 motion on June 11, 2019. (ECF No. 115.) OGS answered on June 17, 2019. (ECF No. 27 116.) 2 October 19, 2018. (ECF No. 38.) On December 13, 2018, Judge Bashant granted the 3 motion in part, and denied it in part. (ECF No. 62.) Defendants OGI, Yan, and Ferry filed 4 a Motion for Reconsideration on December 20, 2018, (ECF No. 63), which Judge Bashant 5 denied on December 26, 2018, (ECF No. 67). On January 25, 2019, Defendants OGI, Yan, 6 and Ferry filed a second motion for summary judgment or summary adjudication. (ECF 7 No. 79.) OGS joined in this motion after making a general appearance on June 18, 2019. 8 (ECF No. 119.) Judge Bashant denied this motion on August 13, 2019. (ECF No. 163.) 9 On April 26, 2019, with a pretrial conference scheduled for May 20, 2019 and trial 10 to proceed on July 16, 2019, Plaintiff filed an ex parte motion to continue the pretrial 11 and trial related dates by 90 to 120 days. (See ECF No. 33 at 5-6; ECF No. 101.) Plaintiff 12 based her request on unresolved discovery issues regarding the valuation of the 13 defendant companies, and uncertainty about whether late-served and specially- 14 appearing defendant, Mexican company Old Gringo, S.A. de C.V. (“OGS”), would remain 15 in the case for trial. (See id.) With both the motion to quash service of summons and 16 the second defense motion for summary judgment then pending, the Court vacated the 17 pretrial dates and instructed the parties to contact chambers to schedule a case 18 management conference within three days of Judge Bashant’s rulings on the pending 19 motions. (ECF No. 103.) Judge Bashant issued rulings denying OGS’ jurisdictional 20 motion on June 11, 2019, (ECF No. 115), and denying Defendants’ motion for summary 21 judgment on August 13, 2019, (ECF No. 163). 22 After Judge Bashant denied Defendants’ motion, the parties placed a joint call to 23 chambers on August 16, 2019, and the Court set a Case Management Conference for 24 September 11, 2019, based on the parties’ availability. (See ECF No. 164.) Pursuant to 25 the Court’s order, the parties submitted a Joint Discovery Plan on September 6, 2019, 26 specifically addressing the parties’ positions on discovery regarding the newly-appeared 27 OGS, and the resetting of pretrial and trial dates. (See ECF Nos. 164, 172.) While the 2 condition, finances, and value,” and requested 10 to 12 months to conduct such 3 discovery, particularly because OGS is a Mexican company, and Plaintiff’s expert 4 anticipated that it would take approximately that amount of time to use the Hague 5 Evidence Convention to effectuate discovery in Mexico. (ECF No. 172 at 10-11.) On the 6 other hand, OGS noted that Plaintiff had obtained substantial discovery regarding OGS 7 from the other defendants in this action and argued that the discovery period had 8 closed, and discovery from OGS should be limited to relevant information which Plaintiff 9 could not have already obtained by other means. (Id. at 14-15, 19, 31.) Nevertheless, 10 OGS agreed to additional depositions of Tarut and Ferry, who refused to answer 11 questions about OGS at their initial depositions; to make three OGS witnesses available 12 for voluntary depositions in Mexico; and stated they would likely agree that Plaintiff 13 should be entitled to OGS discovery that could not have been obtained during open 14 discovery. (Id. at 14-15.) Plaintiff argued for following the Hague Evidence Convention 15 procedures, rather than voluntary discovery under the Federal Rules as suggested by 16 Defendant, based on Plaintiff’s expert’s opinion that not following Hague Evidence 17 Convention could jeopardize Plaintiff’s efforts to collect a future judgment against 18 Mexican-based assets. (Id. at 28-29.) 19 The Court then held telephonic case management conferences on September 11 20 and 17, 2019. (ECF Nos. 174, 177.) After considering the parties’ extensive briefing and 21 oral advocacy regarding the appropriateness of permitting Plaintiff to conduct further 22 discovery into OGS, on September 19, 2019, the Court issued a Second Amended 23 Scheduling Order reiterating discussions and indicated orders from the September 17 24 conference. (ECF No. 179.) The Order permitted Plaintiff nearly four additional 25 months—not the 10 to 12 requested by Plaintiff—to conduct discovery into OGS. (Id. at 26 4-5 & n.1.) The Order further specified that such discovery was to be “completed by 27 Plaintiff on or before January 13, 2020,” and emphasized that “[i]t is incumbent on 2 Mexico ex parte on October 10, 2019. (See ECF No. 189.) While Defendants did not 3 oppose the issuance of a letter of request generally, they opposed the motion on 4 procedural grounds and objected certain content of Plaintiff’s proposed letter on 5 substantive grounds on October 15, 2019. (See ECF No. 190.) After finding that 6 Plaintiff’s counsel had completely disregarded his requirement to meet and confer with 7 opposing counsel and improperly filed the motion ex parte, the Court denied the motion 8 without prejudice on October 25, 2019. (ECF No. 191.) On November 16, 2019, the 9 parties filed a Joint Motion for Determination of Discovery Dispute asking the Court to 10 resolve disagreements regarding Plaintiff’s letter of request. (ECF No. 198.) Because 11 the joint motion did not include the schedules to be attached to Plaintiff’s proposed 12 Letter of Request, the Court denied the motion on November 18, 2019. (ECF No. 199.) 13 Plaintiff refiled the parties’ joint motion with the necessary attachments on November 14 19, 2019. (ECF No. 200.) On November 25, 2019, the Court issued an order instructing 15 Plaintiff to resubmit her Letter of Request with certain modifications, so that the Court 16 could issue it. (See ECF No. 201.) The Court signed the Letter of Request on December 17 2, 2019, (ECF No. 202), and a certified copy was made available to Plaintiff on December 18 5, 2019. (ECF No. 209-1 at 2.) 19 Plaintiff filed the Instant Motion, asking to continue all remaining dates by at least 20 four months, on January 8, 2020, just five days before discovery cut-off. (ECF No. 209.) 21 Defendants opposed the motion on January 9, 2020. (ECF No. 210.) 22 II. DISCUSSION 23 A. Procedural Issues 24 Defendants have raised two procedural objections to Plaintiff’s motion. First, 25 Defendants claim that the Instant Motion qualifies as a discovery motion and should 26 have been filed as a joint motion under the Court’s Civil Chambers Rule IV.F. (ECF No. 27 210 at 2.) Second, Defendants argue that the Instant Motion is not timely because it 2 by Court’s Civil Chambers Rule V. (Id. at 3.) 3 The Court construes the Instant Motion to change a discovery deadline and trial- 4 related dates set in the Second Amended Scheduling Order [ECF No. 179] as a motion to 5 modify the scheduling order, not a discovery dispute motion, subject to Civil Chambers 6 Rule V, but not Civil Chambers Rule IV. The Court does not require that motions to 7 modify the scheduling order be brought by joint motion; but does require that “any 8 request to continue an ENE, MSC, or scheduling order deadline shall be made in writing 9 no less than seven (7) calendar days before the affected date.” Civil Chambers Rule V 10 (emphasis in original). Plaintiff explains in the Instant Motion that her counsel was 11 “severely ill on January 6 and January 7,” and that “Plaintiff’s counsel also wished to file 12 because he believed that more information on the Mexican authorities’ timetable might 13 be forthcoming by January 8.” (ECF No. 209-1 at 3.) Defendants argue that given the 14 fact that Plaintiff’s counsel has known he would be filing this motion since December 19, 15 2019, and since he has experienced multiple last minute emergencies that have caused 16 him to miss filing deadlines in this case, “diligence would require that Plaintiff’s counsel 17 not wait until the very last day of a deadline to prepare a motion that Plaintiff has 18 known about the need for since at least December 19, 2019.” (ECF No. 210 at 4.) 19 The Court agrees that the instant motion is untimely under the circumstances. 20 Nevertheless, the Court exercises its discretion and will not deny the motion on this 21 basis. 22 B. Plaintiff Has Not Shown Good Cause to Amend the Scheduling Order 23 A scheduling order “may be modified only for good cause and with the judge’s 24 consent.” Fed. R. Civ. P. 16(b)(4). This good cause standard “primarily considers the 25 diligence of the party seeking the amendment. The district court may modify the 26 pretrial schedule ‘if it cannot reasonably be met despite the diligence of the party 27 seeking the extension.’” Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th 2 ECF No. 203-1 at 6 (OGS citing same authority and standard), ECF No. 204 at 4 (Plaintiff 3 citing same standard and authority).) 4 When ruling on Rule 16 motions to reopen discovery, the Ninth Circuit has 5 instructed district courts to consider the following factors: 6 1) whether trial is imminent, 2) whether the request is opposed, 3) whether the non-moving party would be prejudiced, 4) whether the moving party was 7 diligent in obtaining discovery within the guidelines established by the court, 8 5) the foreseeability of the need for additional discovery in light of the time allowed for discovery by the district court, and 6) the likelihood that the 9 discovery will lead to relevant evidence. 10 City of Pomona v. SQM N. Am. Corp., 866 F.3d 1060, 1066 (9th Cir. 2017) (quoting 11 United States ex rel. Schumer v. Hughes Aircraft Co., 63 F.3d 1512, 1526 (9th Cir. 1995).) 12 Here, Plaintiff asks to continue the remaining dates, including OGS discovery 13 cutoff and pretrial dates by 120 days or vacate them all together until Plaintiff receives a 14 response to the Court’s Letter of Request from the Mexican Authority. (ECF No. 209 at 15 1.) In support of her request to modify the scheduling order to permit Plaintiff to 16 complete OGS discovery pursuant to the Court’s Letter of Request, Plaintiff argues that 17 she “diligently complied with the complex procedure to secure the Letter of Request 18 from the Court and duly transmitted it to Mexico, where is now awaits action by the 19 Mexican authorities over whom Plaintiff has no control.” (ECF No. 209-1 at 3, 5-11.) 20 Detailing the timeline of Plaintiff’s efforts to secure the Letter of Request from the 21 Court, Plaintiff argues that Plaintiff’s actions were both diligent and reasonable “given 22 the scope of the task and the needed participation of Defendants and the Court.” (Id. at 23 10.) Plaintiff adds that she “requires discovery from [OGS], embodied in the Letter of 24 Request, to present her case at trial,” specifically noting that she will not be able to 25 compel the Mexican witnesses to testify at trial and their depositions are the only way 26 to admit their testimony. (Id. at 11.) 27 2 at least as early as May 2019, she waited until the Court issued the Second Amended 3 Scheduling Order on September 19, 2019 to even begin the process. (ECF No. 210 at 4.) 4 Defendants argue that Plaintiff should have begun this process after OGS appeared as a 5 party in this case on June 17, 2019. (Id. at 4.) Defendants argue that Plaintiff lacked 6 diligence even after the Court filed the Second Amended Scheduling Order, when 7 knowing of the time constraints, Plaintiff did not properly file her motion as soon as 8 possible. (Id. at 5.) Second, Defendants argue that Plaintiff has sufficient information to 9 present her case at trial, as she has already received extensive discovery related to OGS, 10 “including all financial statements and all communications for all relevant years,” and 11 Plaintiff will be deposing Defendants Tarut and Ferry, the majority owners and president 12 of OGS (Ferry). (Id. at 6.) Finally, Defendants point out that Plaintiff has alleged no new 13 facts since to indicate changed circumstances from those presented to the Court at the 14 time of the September case management conference and considered by this Court 15 when issuing the Second Amended Scheduling Order. (Id. at 6-7.) 16 Consideration of the prescribed factors in this case does not support modification 17 of the scheduling order. For the second time, this case is at the point of pretrial 18 disclosures, and quickly approaching trial, a fact that weighs against amending the 19 scheduling order. Also for the second time, Defendants strongly oppose Plaintiff’s 20 request, noting that “[t]he disruption to Defendants’ lives and businesses from this case 21 has been extremely damaging. Defendants have been ready to go to trial in this case for 22 over a year.” (ECF No. 210 at 6.) The need for this discovery was foreseeable, as 23 Plaintiff knew when she brought this case that OGS was a Mexican Corporation, and 24 Plaintiff has not alleged any major changes in the applicable law between 2017 and 25 now. It is also speculative when, if ever, Plaintiff will be able to complete discovery in 26 Mexico pursuant to the Letter of Request. Plaintiff is not able to predict when she may 27 hear from the Mexican Authority, (see ECF No. 209-1 at 3), and Mexico is not required 2 inappropriate or in violation of Mexico’s internal laws.”) .) 3 The last factor is Plaintiff’s diligence. First the Court notes that it does not 4 consider only Plaintiff’s actions since September 19, 2019 when determining whether 5 Plaintiff has acted diligently, it evaluates Plaintiff’s diligence from the beginning of this 6 case, particularly regarding the Letter of Request procedure that Plaintiff has insisted on 7 utilizing in this case. Plaintiff brought this lawsuit naming Mexican Company, OGS, as a 8 defendant. Plaintiff ought to have known from the beginning that it would seek 9 discovery from OGS and could have learned that if she sought to use Hague Evidence 10 Convention discovery procedures, such discovery would take approximately twelve 11 months. Plaintiff did not have to wait for OGS to make a general appearance in this case 12 to seek discovery from OGS under the Hague Evidence Convention, which “draws no 13 distinction between evidence obtained from third parties and that obtained from the 14 litigants themselves.” Societe Nationale Industrielle Aerospatiale v. U.S. Dist. Court for 15 S. Dist. of Iowa, 482 U.S. 522, 541 (1987). Instead, Plaintiff evidently sought documents 16 and information regarding OGS from the other Defendants. (See ECF No. 58 at 44-101; 17 ECF No. 73 at 3-7, 13-15, 66-92.) This approach was quite effective and resulted in the 18 production of significant documents related to OGS, (see ECF Nos. 85), and the 19 depositions of Tarut and Ferry into OGS’ finances and operation, (ECF No. 159). If 20 Plaintiff believed discovery via a letter of request was essential to her case, she waited 21 until after OGS’ appearance to seek it at her own peril. 22 In their Joint Discovery Plan submitted prior to the September 2019 Case 23 Management Conferences, both parties offered extensive argument regarding whether 24 Plaintiff should be permitted additional time to conduct discovery into OGS, and 25 whether any continuance should accommodate the letter of request schedule Plaintiff 26 advocated. The Court considered the timeline to date and the parties’ arguments when 27 it determined to grant the Plaintiff less than four months for additional OGS discovery. 2 Evidence Convention were potentially available for Plaintiff to take discovery. See 3 Multimedia Patent Tr. v. Apple Inc., Case No. 10-CV-2618-H, 2012 WL 12868304, at *2 4 (S.D. Cal. July 30, 2012) (citing Societe Nationale, 482 U.S. at 529) (“The Hague 5 Convention procedures are not exclusive or mandatory, but rather is an optional 6 supplement to the Federal Rules to facilitate the taking of evidence abroad.”). In fact, 7 Defendants had offered to make certain witnesses available for voluntary depositions. 8 (ECF No. 172 at 14.) The Second Amended Scheduling Order did not endorse the Hague 9 Evidence Convention procedures, and stressed it was “incumbent on Plaintiff to 10 diligently pursue discovery within the time provided.” (ECF No 179 at 5 (emphasis 11 added).) Nevertheless, knowing that she likely did not have enough time to obtain 12 discovery via a letter of request, Plaintiff still chose to pursue that route. 13 Plaintiff suggests that since this Court issued the letter of request, it has endorsed 14 her strategy and implied that she will be given additional time to pursue it. (See ECF No. 15 209-1 at 1-2 (requesting to extend deadlines to “allow Plaintiff to complete Court- 16 authorized discovery in Mexico”) (emphasis added), 2-3 (stating “[b]ecause Plaintiff 17 diligently complied with the complex procedure to secure the Letter of Request from 18 the Court and duly transmitted it to Mexico, where it now awaits action by the Mexican 19 authorities over whom Plaintiff has no control, Plaintiff respectfully requests that the 20 Court amend the scheduling order”).) However, because Defendants did not oppose the 21 use of the letter of request procedure, (ECF No. 198 at 4), the Court did not address 22 whether the Hague Evidence Convention was the correct procedure to follow, only 23 which evidence sought by Plaintiff was discoverable. (See ECF No 201 at 1-2, 4.) 24 Further, while Plaintiff’s counsel appears to have spent a lot of time working on 25 this case, (see, e.g., ECF No. 209-1 at 6-10, ECF Nos. 180, 185, 189, 192, 196, 197, 198, 26 200, 204, 207), the Court is not persuaded that Plaintiff exercised the diligence required 27 by the circumstances. Specifically, Plaintiff understands parties are required to meet 1 || (See, e.g, ECF No. 80 at 5, 8, 34 (the Court stating “I don’t think the two of you have in 2 good faith... got together and tried to resolve this on your own without the Court’s 3 || assistance” and breaking for counsel to further meet and confer), Judge Berg’s Civil 4 || Chambers Rules IV. A., Civ. LR 26.1(a), ECF No. 179 at 5.) Nevertheless, Plaintiff elected 5 || to file her “Ex Parte Motion for Issuance of Letter of Request” [ECF No. 189] over three 6 || weeks after the Case Management Conference where the parties were first informed 7 there would be an additional OGS discovery period, without meeting and 8 || conferring at all with Defendants regarding the content of the request. (See ECF No. 9 at 4-5.) Notably, when the parties did finally engage in some meet and confer 10 || conversations, the issues in the motion were narrowed. (Compare ECF No. 190 with ECF 11 || No. 198-1.) Plaintiff’s counsel’s attempt to ignore his responsibilities and the Court’s 12 || strong indication that the parties needed to narrow their disputes as much as possible 13 || unnecessarily delayed the Court’s issuance of a letter of request. 14 For these reasons, the Court finds that Plaintiff’s lack of diligence, and the other 15 || facts, weigh against a modification of the scheduling order to accommodate the 16 ||completion of OGS discovery pursuant to the Letter of Request. 17 lll. CONCLUSION 18 For the foregoing reasons, the Court DENIES Plaintiff's request to modify the 19 || scheduling order or vacate the remaining dates. 20 IT IS SO ORDERED. 21 ||Dated: January 23, 2020 _ TZ. 22 4 L <—{—\. 33 Honorable Michael S. Berg United States Magistrate Judge 24 25 26 27 28