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Hautala v. Progressive Direct Insurance Co.

May 3, 2010

ANDREA HAUTALA AND STEVEN HAUTALA, PLAINTIFFS,
v.
PROGRESSIVE DIRECT INSURANCE COMPANY, DEFENDANT.



The opinion of the court was delivered by: Jeffrey L. VIKEN United States District Judge

ORDER ON DISCOVERY AND RELATED MATTERS

INTRODUCTION

Pending before the court are the defendant's motions to (1) amend or withdraw requests for admissions (Docket 51) and (2) bifurcate and stay portions of discovery (Docket 62), and plaintiffs' second motion to compel discovery (Docket 60). On February 3, 2010, the court heard and considered the arguments of counsel on the issues set forth in the order of January 12, 2010, (Docket 64) and requested the parties to provide additional information regarding the issues requiring resolution by the pending motions. On March 1, 2010, counsel submitted their joint report to the court (Docket 73) and then informally provided the court with correspondence dated February 22, 2010, which counsel agree provides further detail regarding the terms of their concessions and disagreements on discovery and the issues remaining for resolution. These matters are ripe for resolution.

DEFENDANT'S MOTIONS

1. MOTION TO AMEND OR WITHDRAW REQUESTS FOR ADMISSIONS

Under the order granting motion to compel (Docket 49) entered by Chief Judge Karen E. Schreier on September 19, 2009, the court ordered that the "plaintiffs' Second Set of Requests for Admissions are hereby deemed admitted." To understand the reason for that order, it is necessary to examine the history of this case.

Plaintiffs' complaint dated December 18, 2007, in the Fourth Judicial Circuit Court of the state of South Dakota was removed to this court on January 14, 2008. (Docket 1). Defendant's answer dated January 18, 2009, was filed by Attorney Jack H. Hieb. (Docket 4). The court's scheduling order (Docket 7) was entered on February 29, 2008.

Just four months later, defendant's motion for summary judgment (Docket 13) was filed on June 26, 2008. By an order dated July 14, 2008, (Docket 18) Chief Judge Schreier allowed plaintiffs until August 8, 2008, to respond to defendant's motion for summary judgment. On August 8, 2008, plaintiffs filed their brief in resistance to defendant's motion for summary judgment and requested the court defer ruling under Fed. R. Civ. P. 56(f). (Docket 23). In plaintiffs' supporting affidavit, it was asserted that plaintiffs' discovery, including a first set of requests for admissions, interrogatories, and requests for production of documents had been served on defendant on May 9, 2008. (Docket 21, ¶ 14). As of August 8, 2008, defendant had not answered any of that written discovery. Id. at ¶ 12. Plaintiffs' affidavit further indicated that defendant intended to file a motion to bifurcate and stay plaintiffs' bad faith claims, thereby avoiding the necessity of responding to the written discovery, but defendant never filed such a motion. Id. at ¶ 15.

On August 11, 2008, plaintiffs filed plaintiffs' responses and objections to defendant's statement of material facts in dispute and not in dispute. (Docket 24). Also filed with that submission were plaintiffs' first set of requests for admissions to defendant Progressive Direct Insurance Company dated May 9, 2008, (Docket 24-4) and a letter of January 18, 2008, from Attorney Hieb on behalf of defendant wherein he advised that since the action had been removed to federal court he was "going to simply ignore the written discovery requests . . . sent with the Summons and Complaint and assume that you are going to re-serve new interrogatories and requests for production of documents subsequent to the exchange of initial disclosures required by Rule 26(a)(1)." (Docket 24-2).

Defendant filed its reply brief in support of defendant's motion for summary judgment on August 18, 2008. (Docket 26). Contemporaneously with that brief, Attorney Hieb filed defendant's brief in response to plaintiffs' motion to defer ruling pursuant to Fed. R. Civ. P. 56(f) (Docket 27) together with the affidavit of Jack H. Hieb. (Docket 28). Attached to that affidavit was, among other things, plaintiffs' discovery of May 9, 2008, namely:

1. Plaintiffs' first set of requests for admissions (Docket 28-1);

2. Plaintiffs' first set of interrogatories to defendant (Docket 28-2);

3. Plaintiffs' first set of requests for documents to defendant (Docket 28-3); and

4. Plaintiffs' second set of requests of documents to defendant (Docket 28-4).

Attorney Hieb's affidavit asserted that he was under the impression that no responses to the plaintiffs' discovery requests were required until defendant's motion for summary judgment had been decided. (Docket 28 at ¶¶ 12, 13). That affidavit concludes if defendant's counsel had believed responses were due to plaintiffs' discovery, defendant would have moved for a protective order. Id. at ¶ 16.

In response to these submissions on September 2, 2008, Chief Judge Schreier entered an order extending deadlines. (Docket 30). Then on October 3, 2008, Chief Judge Schreier entered an order (Docket 31) denying, without prejudice, defendant's motion for summary judgment and allowing plaintiffs further discovery under Rule 56(f).

Plaintiffs filed their second motion to extend deadlines (Docket 32) on October 16, 2008. Defendant did not oppose that motion. (Docket 33). On November 10, 2008, Chief Judge Schreier entered a second order extending deadlines. (Docket 34).

On December 15, 2008, plaintiffs filed their third motion to extend deadlines (Docket 35) and represented that defendant had no objections to the request. On December 16, 2008, Chief Judge Schreier entered an order extending deadlines. (Docket 36).

On February 10, 2009, plaintiffs filed their fourth motion to extend deadlines (Docket 37) asserting, among other things, that "Plaintiff's [sic] have not received Defendant's answers to discovery" and representing the defendant had no objection to this extension. In response, on February 10, 2009, Chief Judge Schreier entered the fourth order extending deadlines. (Docket 38).

On March 12, 2009, plaintiffs filed their fifth motion to extend deadlines (Docket 39), again asserting that "Plaintiff's [sic] have not received Defendant's answers to discovery" and representing that the defendant had no objection to this extension. On March 16, 2009, Chief Judge Schreier entered the fifth order extending deadlines. (Docket 40).

On May 15, 2008, plaintiffs filed their sixth motion to extend deadlines. (Docket 41). In this motion, plaintiffs represented to the court that "Plaintiff's [sic] have not received Defendant's answers to discovery which has been outstanding since October 2008" and plaintiffs' counsel had attempted contact with defendant's attorney about this motion but had received no response. On May 28, 2009, Chief Judge Schreier, without any response from defendant or its attorney of record, Mr. Hieb, entered the sixth order extending deadlines. (Docket 42).

On July 15, 2009, plaintiffs filed the seventh motion to extend deadlines. (Docket 43). Again, counsel represented to the court that "Plaintiff's [sic] have not received Defendant's answers to discovery which has been outstanding since October 2008," but this time indicated defendant's counsel had no objection to the requested extension. On July 16, 2009, Chief Judge Schreier entered the seventh order extending deadlines. (Docket 44). In this order, defendant was directed to "respond to plaintiffs' request for discovery by August 3, 2009. If it does not respond, plaintiffs shall file a motion to compel by August 10, 2009. There will be no further extensions of discovery deadlines unless a motion to compel discovery is made and granted." Id. (emphasis in original).

On August 10, 2009, plaintiffs filed their first motion to compel. (Docket 45). In this motion, plaintiffs asserted that all of their discovery, dated October 14, 2008, had been served and plaintiffs advised the court that defendant:

1. Failed to produce discoverable documents . . . formally requested in Plaintiffs' Third Set of Interrogatories and Requests for Production of Documents (Docket 46-2); and

2. Failed to produce [respond to] . . . Plaintiffs' Second Set of Requests for Admissions to Defendant (Docket 46-1); and

3. Failed to produce discoverable documents . . . formally requested in . . . Plaintiffs' Fourth Set of Requests for Production of Documents (Docket 46-3).

(Docket 45).

Defendant failed to respond to plaintiffs' first motion to compel and thirty-five days later, on September 15, 2009, plaintiffs filed their motion for default on plaintiffs' first motion to compel. (Docket 47). On September 17, 2009, Chief Judge Schreier entered an order granting plaintiffs' motion to compel. (Docket 49). In that order, Chief Judge Schreier found, among other things, that:

All the discovery requests were dated October 14, 2008. Defendant has not responded to or objected to the discovery requests. Nor has defendant moved for a protective order. Plaintiffs did move for seven extensions of the discovery deadline because plaintiffs had not received defendant's responses to their discovery requests. The court granted the extension, but in its order dated July 16, 2009, directed defendant to respond to plaintiffs' requests for discovery by August 3, 2009. Defendant did not meet this deadline and, as a result, plaintiffs moved to compel discovery on August 10, 2009.

Id. Based upon those findings, Chief Judge Schreier's order granted the motion to compel and gave direction to the defendant as follows:

IT IS FURTHER ORDERED that defendant shall respond to plaintiffs' Third and Fourth Set of Interrogatories and Request for Production of Documents no later than October 15, 2009.

IT IS FURTHER ORDERED that plaintiffs' Second Set of Requests for Admissions are hereby deemed admitted.

IT IS FURTHER ORDERED that plaintiffs shall be entitled to reasonable attorney's fees for bringing this motion to compel. Plaintiffs shall file an affidavit setting forth the time spent on this motion and the hourly rate requested for attorney's fees by October 10, 2009. . . . .

Id. (emphasis in original). The order was electronically served on defendant's attorney, Mr. Hieb, on September 17, 2009.

On September 25, 2009, Attorney Lon Kouri filed a notice of appearance (Docket 50) indicating that he was appearing as co-counsel on behalf of the defendant. Then on September 28, 2009, defendant, through Attorney Kouri, filed the defendant's motion to amend or withdraw requests for admissions. (Docket 51). Defendant now acknowledges that it failed to satisfy the August 3, 2009, discovery deadline imposed by the court's order extending deadlines. See defendant's memorandum in support of defendant's motion to amend or withdraw responses to requests for admissions (second set). (Docket 52, p. 2). Defendant also admits that it did not respond to plaintiffs' August 10, 2009, motion to compel. Id.

In support of its motion to amend or withdraw, defendant asserts that "if deemed admitted [some of plaintiffs' thirty-two requests for admission], are arguably dispositive of this case." Id. at p. 3. Defendant identifies those particular requests for admission as:

19. That Defendant owed UIM policy benefits to Plaintiff Andrea Hautala;

20. That Defendant did withhold UIM benefits from Plaintiffs;

21. That Defendant encourages its claims personnel to reduce and/or diminish the amount of money paid out to first ...


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