United States District Court, D. Nevada
DESERT PALACE, INC., d/b/a CAESERS PALACE, a Nevada Corporation, Plaintiff,
v.
ANDREW P. MICHAEL,
ORDER
GEORGE
FOLEY, JR. United States Magistrate Judge.
This
matter is before the Court on Plaintiff's Motion to
Compel (ECF No. 44), filed on January 3, 2017. Instead of
filing a response to Plaintiff's motion to compel,
Defendant filed his Motion to Continue Filing Deadlines and
Hearing Regarding Plaintiff's Motion to Compel (ECF No.
49) on January 8, 2017. Plaintiff filed its Opposition (ECF
No. 53) on January 13, 2017 and Defendant filed his Reply
(ECF No. 55) on January 18, 2017. The Court conducted a
hearing in this matter on January 30, 2017.
BACKGROUND
AND DISCUSSION
Plaintiff
Desert Palace Inc., d/b/a Caesars Palace
(“Caesars”) filed this action in the Nevada
District Court, Clark County, Nevada on June 25, 2015.
Defendant Andrew Michael (“Michael”) removed the
action to federal court on March 3, 2016. Caesars alleges
that Michael, a regular casino customer, executed credit
applications seeking a credit line pursuant to which he would
receive gaming chip advances up to a certain approved
monetary limit. Complaint (ECF No. 1), ¶¶
7, 8. The credit applications signed by Michael contained the
following provisions: (a) “Before drawing on my line of
credit, if granted, I agree to sign credit instruments (i.e.,
checks) in the amount of the draw;” (b) “I agree
that each draw against my credit line is a separate advance
of money by [Caesars];” (c) “If I receive an
advance before I execute a credit instrument, I promptly will
sign a credit instrument in the amount of the advance;”
(d) “I am aware that this application is required to be
prepared by the Nevada State Gaming Control Board regulations
of the State of Nevada, and I may be subject to civil or
criminal liability if any material information provided by me
is willfully false;” (e) “I agree that this
application and all credit issued pursuant thereto will be
governed, construed and interpreted pursuant to the laws of
the State of Nevada and venue shall lie solely in that
state;” and (f) “I agree that [Caesars] may
litigate any dispute involving the credit line, the debt or
the payee in any court, state or federal, in Nevada. I submit
to the jurisdiction of any court, state or federal, in the
state of Nevada.” Complaint (ECF No. 1),
¶ 8.
According
to Caesars:
Although a credit instrument (also referred to as a
“marker”) is generally
signed contemporaneously when funds are advanced on credit to
a casino patron, Nevada law and the regulations of the Nevada
Gaming Commission promulgated thereunder also permit and
authorize a licensee to advance funds on credit to a patron
through the initial use of “lammers” a customary
practice when a licensee allows a patron to “play on
the rim” (also referred to as “rim
play”). Rim play is generally a courtesy
extended only to high level, ultra-VIP casino patrons.
During rim play, a licensee uses “lammers” or
“rim cards” to track advances made to a patron
during play, while the patron is in action, thereby allowing
the patron to game without interrupting play to obtain
executed markers.
Complaint (ECF No. 1), ¶¶ 15-16.
Michael
gambled at Caesars Palace on September 20-21, 2014, during
which he received advances that exhausted his entire credit
limit of $3 million. Id. at ¶¶ 19-21.
After completing his play, Michael allegedly avoided
Caesars' employees who attempted to have him execute a
marker. Michael left Nevada and returned to London, England
and has since refused to execute the marker. Id. at
¶¶ 22-40. Caesars alleges claims against Michael
for breach of contract, breach of the implied covenant of
good faith and fair dealing, unjust enrichment, fraud,
specific performance, account stated, promissory/equitable
estoppel, and declaratory relief. In his answer to the
complaint, Michael denies that “Rim Debt” is
valid or enforceable. Answer (ECF No. 5),
¶¶ 21-39. Michael also alleges that “[a]t the
time of the alleged advances, [he] lacked the capacity to
contract given Caesars consistent provision of alcohol
throughout the period in question.” Id. at pg.
12, Affirmative Defense No. 23. Michael also asserts a
counterclaim for $582, 800 that Caesars allegedly owes to
him. Both parties have filed motions for summary judgment
regarding the legal enforceability of Michael's $3
million gambling debt.
In its
motion to compel, Caesars states that it noticed Defendant
Michael's deposition to be taken on December 13, 2016 at
Plaintiff's counsel's law office in Las Vegas,
Nevada. Caesars also noticed the depositions of non-parties
Chris Michael, Elias Michael, Ian Simpkins and Kai Feller.
These individuals allegedly accompanied Defendant Michael
during his visit to Caesars in September 2014 and were
present when he gambled on September 21-22, 2014. These
witnesses apparently reside in England or Europe. Caesars
seeks their depositions in regard to Michael's
affirmative defense that Caesars plied him with alcohol such
that he was not legally competent to request advances on his
credit limit. Caesars served subpoenas for the non-party
deponents on Michael's counsel who indicated that he was
the contact person for these individuals. Neither Defendant
Michael or the witnesses appeared for their scheduled
depositions. Caesars is willing to take the witnesses'
depositions by remote video conferencing so that they need
not travel to the United States. Caesars, however, seeks an
order compelling Defendant Michael to appear in Las Vegas for
his deposition.
Michael
requests in his motion that Plaintiff's motion and its
related briefing schedule, and the depositions be continued
until the motions for summary judgment are decided “and
the validity of this Court's jurisdiction over
Plaintiff's action is determined.” Motion to
Continue (ECF No. 49), pg 6. Defendant, in effect, moves
for a stay of discovery pending a decision on the motions for
summary judgment.
DISCUSSION
“The
Federal Rules of Civil Procedure do not provide for automatic
or blanket stays of discovery when a potentially dispositive
motion is pending.” Kor Media Group, LLC v.
Green, 294 F.R.D. 579, 581 (D.Nev. 2013) (quoting
Tradebay, LLC v. eBay, Inc., 278 F.R.D. 597, 601
(D.Nev. 2011). “Courts in this District have formulated
three requirements in determining whether to stay discovery
pending resolution of a potentially dispositive motion;
motions to stay discovery may be granted when: (1) the
pending motion is potentially dispositive; (2) the
potentially dispositive motion can be decided without
additional discovery; and (3) the Court has taken a
‘preliminary peek' at the merits of the potentially
dispositive motion and is convinced that the plaintiff will
be unable to state a claim for relief.” Id.; see
also Jones v. Wirth, 2016 WL 4994962, *3 (D.Nev. Sept.
16, 2016). In this case, both parties have filed motions for
summary judgment on the issue of whether Michael's $3
million gambling debt is legally enforceable under Nevada
law. If Defendant Michael's motion is granted, it would
be dispositive of the case. The issue can be decided without
additional discovery.
The
Court has reviewed the parties' briefs on the summary
judgment motions. Although Defendant Michael casts the issue
as jurisdictional, it is not jurisdictional in the sense of
whether the court has personal jurisdiction over the parties
or whether the claims fall within federal subject matter
jurisdiction. Instead, Defendant contends that the ...