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Dinkins v. Schinzel

United States District Court, D. Nevada

January 17, 2018

KENNETH DINKINS, Plaintiff,
v.
GERALDINE SCHINZEL, Defendants.

          ORDER

          GEORGE FOLEY, JR. UNITED STATES MAGISTRATE JUDGE

         This matter is before the Court on Defendant's Motion to Compel (ECF No. 37), filed on September 1, 2017. Plaintiff filed his Response (ECF No. 46) on September 18, 2017. Defendant filed her Reply (ECF No. 53) on September 21, 2017. The Court conducted a hearing in this matter on September 29, 2017. Defendant filed her Supplement to her Motion to Compel (ECF No. 61) on October 17, 2017. Plaintiff filed his Response to the Supplement (ECF No. 64) on October 20, 2017. Also before the Court is Defendant's Motion to Compel (ECF No. 75), filed on November 21, 2017. Plaintiff filed his Response (ECF No. 76) on December 4, 2017 and Defendant filed her Reply (ECF No. 77) on December 8, 2017.

         BACKGROUND

         This matter arises from Plaintiff's allegations of defamation, intentional infliction of emotional distress, tortious interference with business relationship, and assault stemming from a real property transaction between Plaintiff and Defendant. See Complaint (ECF No. 1). Plaintiff alleges that Defendant published defamatory statements regarding his real estate transactions on a website causing him emotional distress and interference with his business relationships. Id. Defendant asserts counterclaims against Plaintiff including fraud, breach of contract, breach of covenant of good faith and fair dealing, defamation, and invasion of privacy claims. See Amended Counterclaim (ECF No. 70). Defendant alleges that Plaintiff made fraudulent misrepresentations regarding real property in Arizona that he sold to Defendant, that Plaintiff breached their contract and the implied covenant of good faith and fair dealing by failing to transfer a warranty deed, and that Plaintiff published defamatory statements regarding Defendant. Id.

         Defendant requests an order compelling Plaintiff to respond to Defendant's requests for production. Plaintiff produced redacted income tax returns and Defendant argues that Plaintiff should produce income tax returns that include paid preparer information and deductions. Defendant further requests profit and loss statements for Summit Ventures, LLC, bank statements, advertisements, documents containing communications about obtaining Plaintiff's services, documents containing defamatory statements, and property records.

         DISCUSSION

         Rule 26(b)(1) of the Federal Rules of Civil Procedure provides that “[p]arties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, and the importance of the discovery in resolving the issues, and whether the burden and expense of the proposed discovery outweighs its likely benefit. Information within the scope of discovery need not be admissible in evidence to be discoverable.”

         The intent of the 2015 amendments to Rule 26(b) was to encourage trial courts to exercise their broad discretion to limit and tailor discovery to avoid abuse and overuse, and to actively manage discovery to accomplish the goal of Rule 1 “‘to secure the just, speedy, and inexpensive determination of every action and proceeding.'” Roberts v. Clark County School District, 312 F.R.D. 594, 601-04 (D. Nev. 2016). The court, quoting Chief Justice Roberts' 2015 Year-End Report, states:

The 2015 amendments to Rule 26(b)(1) emphasize the need to impose “reasonable limits on discovery through increased reliance on the common-sense concept of proportionality.” The fundamental principle of amended Rule 26(b)(1) is “that lawyers must size and shape their discovery requests to the requisites of a case.” The pretrial process must provide parties with efficient access to what is needed to prove a claim or defense, but eliminate unnecessary and wasteful discovery. This requires active involvement of federal judges to make decisions regarding the scope of discovery.

312 F.R.D. at 603. See also Nationstar Mortgage v. Flamingo Trails No. 7, 316 F.R.D. 327, 331 (D.Nev. 2016).

         The party opposing discovery has the burden of showing that it is irrelevant, overly broad, or unduly burdensome. Graham v. Casey's General Stores, 206 F.R.D. 251, 253-4 (S.D.Ind. 2000); Fosbre v. Las Vegas Sands Corp., 2016 WL 54202, at *4 (D.Nev. Jan. 5, 2016); Izzo v. Wal-Mart Stores, Inc., 2016 WL 593532, at *2 (D.Nev. Feb. 11, 2016). When a request is overly broad on its face or when relevancy is not readily apparent, however, the party seeking discovery has the burden to show the relevancy of the request. Desert Valley Painting & Drywall, Inv. v. United States, 2012 WL 4792913, at *2 (D.Nev. Oct. 9, 2012) (citing Marook v. State Farm Mut. Auto. Ins. Co. 259 F.R.D. 388, 394-95 (N.D. Iowa 2009)). The 2015 amendments to Rule 26(b) have not changed these basic rules, although they must now be applied with a greater emphasis on proportionality.

         1.Tax Returns

         Discovery regarding a party's financial condition may be obtained if it is relevant to the claims or defenses in the case. Wynn Las Vegas v. Zoggolis, 2014 WL 2772241, *4-5 (D.Nev. June 17, 2014); Pacific Coast Steel v. Leany, 2011 WL 4572008 (D.Nev. September 30, 2011); Dawe v. Corrections, USA, 2008 WL 1849802, *5-9 (E.D.Cal. April 23, 2008); and iSmart International Ltd. v. I-Docsecure, LLC, 2006 WL 2263910, *2-3 (N.D.Cal. August 8, 2006). Where inquiry into a party's financial condition is of only marginal relevance and based on speculative assertions, however, the court may in its discretion deny such discovery. Brady v. Conseco, Inc., 2009 WL 5218046, *2 (N.D.Cal. December 29, 2009); Sarbacher v. Americold Realty Trust, 2011 WL 2470681, *3 (D.Idaho June 20, 2011).

         Plaintiff has already produced his income tax returns, but has redacted sections identifying the paid preparer, Summit Ventures' reductions, and personal identifying information. Defendant does not dispute that Plaintiff may redact personal identifying information including EINs, social security numbers, and names of dependents. Plaintiff argues that he is not required to hire a licensed tax preparer and that Defendant's request is harassing and invasive. See Response (ECF No. 64), 2. He further represents that he provided 2015 and 2016 tax returns for Summit Ventures because those are the only years in which Summit Ventures filed its taxes. Id. at 3. Plaintiff's financial condition is relevant to the claims and defenses in this case and he is instructed to produce his tax returns in their entirety, but he may redact social ...


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