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Snow Covered Capital, LLC v. Weidner

United States District Court, D. Nevada

June 26, 2019

SNOW COVERED CAPITAL, LLC, Plaintiffs,
v.
WILLIAM WEIDNER, et al., Defendants.

          ORDER [DOCKET NOS. 27, 33]

          NANCY J. KOPPE, UNITED STATES MAGISTRATE JUDGE

         Pending before the Court is Plaintiff's motion for expedited discovery to take the deposition of nonparty John Knott prior to the Rule 26(f) conference, which Plaintiff filed on an emergency basis. Docket No. 34. Defendants filed a response in opposition. Docket Nos. 32, 34 (joinder), 35 (joinder). Plaintiff filed a reply. Docket No. 39. Defendants also filed a counter-motion for protective order. Docket Nos. 33, 34 (joinder), 35 (joinder). Plaintiff filed a response in opposition. Docket No. 40. These motions are properly resolved without a hearing. See Local Rule 72-1. For the reasons discussed below, the motion for expedited discovery is hereby DENIED and the counter-motion for protective order is DENIED as unnecessary.[1]

         I. BACKGROUND

         This is a civil case arising out of loan agreements for the now-defunct Lucky Dragon Hotel and Casino. Docket No. 1. Plaintiff is seeking to recover from Lucky Dragon and individual guarantors for losses associated with a loan default. The complaint was filed on April 8, 2019. Defendants answered the complaint on June 18 and June 19, 2019. Docket Nos. 19, 21, 22. Given that recent appearance, no discovery conference has taken place pursuant to Rule 26(f) of the Federal Rules of Civil Procedure.

         Mr. Knott is not a party to this action, but he participated in the marketing of the Lucky Dragon before and after the foreclosure of the property. He has been diagnosed with Stage IV pancreatic cancer and has approximately one month before he passes away. Knott Decl. (Docket No. 29) ¶ 7. He has already hosted a “final going away party.” Id. at ¶ 8. Mr. Knott is preparing to enter hospice care. Id. He has been prescribed medications to help manage his anticipated pain and to provide him comfort, medications that will interfere with his ability to testify. Id. at ¶ 9. Notwithstanding the above, Plaintiff obtained a declaration from Mr. Knott that he is available on a few dates to be deposed “[a]ssuming that [his] medical condition permits.” Id. at ¶ 10.

         The instant dispute centers on whether the Court should allow early discovery for that deposition.[2]

         II. STANDARDS

         “A party may not seek discovery from any source before the parties have conferred as required by Rule 26(f), except in a proceeding exempted from initial disclosures under Rule 26(a)(1)(B), or when authorized by these rules, by stipulation, or by court order.” Fed.R.Civ.P. 26(d); see also Fed. R. Civ. P. 30(a)(2)(A)(iii) (addressing the need to obtain leave of court for depositions taken before the Rule 26(d) timeframe). Early discovery may be permitted by court order upon a showing of good cause. Am. LegalNet, Inc. v. Davis, 673 F.Supp.2d 1063, 1066 (C.D. Cal. 2009).[3] The party seeking expedited discovery bears the burden of making that showing. Id. Because expedited discovery is not the norm, the movant must make a prima facie showing of the need for that expedited discovery. Id. A finding of good cause may be made where the need for expedited discovery, in consideration of the administration of justice, outweighs the prejudice to the responding party. Id. Court engage in that balancing analysis by evaluating the reasonableness of the request in light of all the surrounding circumstances. Id. at 1067.[4] At bottom, courts have “wide discretion” in determining whether the circumstances justify expedited discovery. Semitool, Inc. v. Tokyo Electron Am., Inc., 208 F.R.D. 273, 276 (N.D. Cal. 2002) (citing Little v. City of Seattle, 863 F.2d 681, 685 (9th Cir. 1988)).

         Moreover, courts always maintain the discretion, in the interests of justice, to prevent excessive or burdensome discovery. American LegalNet, 673 F.Supp.2d at 1067; see also Fed. R. Civ. P. 30(a)(2)(A)(iii) (incorporating limitations on discovery in Rule 26(b)). Courts are more likely to authorize expedited discovery on specific, limited topics. See 8A Wright, Miller & Marcus, Federal Practice and Procedure, § 2046.1 at p. 291 (2019 suppl.). On the other hand, courts generally eschew requests for open-ended discovery at this stage, such as “a free ranging deposition” for which there is not sufficient time or information to prepare. Semitool, 208 F.R.D. at 277.

         III. ANALYSIS

         Plaintiff's motion fails to show good cause for the relief requested. As a threshold matter, Plaintiff's highlight that Mr. Knott “generous[ly] offer[ed] to testify” and “volunteered to give his deposition.” See Docket No. 43 at 1. The Court is not privy to Mr. Knott's beliefs other than understanding them from his attestations in his declaration that he “could attend a deposition” and would be “available” if his medical condition permits. See Knott Decl. at ¶ 10. These statements do not strike the Court as someone excited about spending his precious remaining time being deposed in a civil suit about a loan agreement. At any rate, the Court is aware that Mr. Knott himself has not objected to the deposition.

         Nonetheless, the remaining circumstances make clear that allowing expedited discovery to conduct this deposition is not justified. Most significantly, there has been no showing that there is any need for the deposition testimony. The motion identifies certain issues related to affirmative defenses on which Mr. Knott may have relevant knowledge. See Docket No. 27 at 5-6. The motion also indicates that his testimony “may be relevant” to expert witness opinions. See Id. at 6. Problematically, the motion does not identify any facts or subjects that are uniquely known to Mr. Knott and cannot be attested to by other employees or a Rule 30(b)(6) deponent. To the contrary, Plaintiff conceded during the meet-and-confer process that “[m]ost if not all of what [Mr. Knott] can testify to can be covered by other CBRE marketing team members.” Docket No. 32-3 at 2 (emphasis added).[5] Given this concession that deposition testimony can be obtained from other witnesses, there is no need to proceed with Mr. Knott's deposition now. See, e.g., Fed.R.Civ.P. 26(b)(2)(C)(i) (courts should not permit discovery that “can be obtained from some other source that is more convenient, less burdensome, or less expensive”).

         The Court is also persuaded by Defendants' argument that allowing a free-wheeling deposition would be prejudicial. See, e.g., Resp. at 4, 7-8. Plaintiff contends that it is proper to conduct this deposition now so that Mr. Knott's deposition testimony can be preserved and the other parties have their own opportunity to examine Mr. Knott. See Docket No. 27 at 5. At the same time, Plaintiff has not clearly identified what ground this deposition will cover. Indeed, Plaintiff represents amazingly in reply that it still does not know what information it will seek at the deposition. Docket No. 39 at 5 (“SCC is still determining how to use its thirty minutes of testimony”). For depositions taken outside the normal course of discovery, this alone is highly problematic. Cf. Fed. R. Civ. P. 27(a)(1)(C) (to obtain an order to allow a pre-litigation deposition to preserve testimony, the movant must identify “the facts that the petitioner wants to establish by the proposed testimony and the reasons to perpetuate it”). The prejudice from conducting a blind deposition is heightened by the shortened notice to opposing counsel of the deposition and the very limited time for the deposition itself.[6] Moreover, no discovery has been conducted in this case, so the parties are unaware what documentary evidence may bear on the issues that will in fact be discussed. Defendants cannot examine (or cross-examine) Mr. Knott effectively without an understanding of the issues that will be discussed and how discovery that is obtained bears on the answers provided.

         In short, this case involves a nonparty in his final days. No. showing has been made that he has unique knowledge or that his testimony will not be duplicative of other deposition testimony. In fact, Plaintiff's counsel acknowledges the contrary. No. guidance has been provided as to the testimony that would be covered, and no discovery has been conducted that would enable effective examination by ...


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