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Luv N' Care Ltd. v. Laurain

United States District Court, D. Nevada

September 10, 2019

LUV N' CARE, LTD., Plaintiff,
v.
LINDSEY LAURAIN, et al., Defendants.

          ORDER

          ELAYNA J. YOUCHAH UNITED STATES MAGISTRATE JUDGE

         Before the Court is Plaintiff Luv N' Care, Ltd.'s (“LNC”) Motion for Attorney's Fees (ECF No. 12), and Plaintiff's Motion to Hold Blue Basin Medical, LLC (“Blue Basin”) and Bradley Laurain in Contempt (ECF No. 13). The Court has considered Plaintiff's Motions, Blue Basin's Response to Plaintiff's Memorandum of Attorney's Fees and Costs (ECF No. 17), Blue Basin and Bradley Laurain's Response to Plaintiff's Motion for Contempt (ECF No. 18), and Plaintiff's Replies (ECF Nos. 19, 22). The Court finds as follows.

         Background

         On July 9, 2018, LNC issued a subpoena to interested party Blue Basin out of the United States District Court for the Western District of Louisiana in the matter pending as Luv N' Care, LTD. v. Lindsey Laurain, Eazy-PZ, LLC, No. 3:16-cv-00777-TAD-JPM. Blue Basin failed to answer the Subpoena or otherwise respond. ECF No. 1 at 5:8-11; ECF No. 1-2, ¶ 7; ECF No. 1-6, ¶ 11; ECF No. 13 at 3:9-10. On October 16, 2018, LNC sent a meet and confer letter to Blue Basin's registered agent Incorp. Services, Inc. (“Incorp.”), and Mr. William Delaney (one of Blue Basin's three managing members) seeking to informally resolve the matter. ECF No. 19 at 2:20-22. Although Incorp. signed the return receipt for the meet and confer letter, Blue Basin did not respond.[1]ECF No. 19 at 2:22-24.

         On November 19, 2018, LNC filed a Motion to Compel Blue Basin to produce documents responsive to its subpoena in this Court. ECF No. 1. On December 19, 2018, the Court granted LNC's Motion, finding Blue Basin in contempt of LNC's subpoena, ordering Blue Basin to “produce all responsive documents . . . no later than December 28, 2018, ” and awarding LNC attorney's fees and costs arising from LNC's Motion to Compel. ECF No. 11 at 2:11-15. Despite this Court's Order, Blue Basin did not produce any documents.

         LNC now alleges Mr. Laurain caused Blue Basin to withhold responsive documents when the Court entered its Order granting LNC's Motion to Compel. ECF No. 13 at 3:24-5:6. LNC believes Mr. Laurain possesses an ulterior motive to withhold documents because he is married to Lindsey Laurain, the founder and sole owner of Eazy-PZ, LLC (“EZPZ”), which is the Defendant in the underlying Louisiana action. ECF No. 1 at 2:21-4.

         LNC's attorneys sent a copy of the Court's December 19, 2018 Order to EZPZ's in-house counsel, Zac Garthe (“Garthe”), on the day it was docketed because LNC mistakenly believed Garthe was acting as Blue Basin's counsel. ECF No. 12-1, ¶¶ 33-38; ECF No. 13 at 3:26-28; ECF No. 17-4, ¶ 3. Garthe responded within an hour of receipt stating, in part:

Earlier this week, Brad found a box of hard-copy documents, some of which he said may relate to Blue Basin. If so, I am not sure if they are responsive to the subpoena. Brad also told me neither he nor his former business associate retained any electronic records at all. We were planning to meet to review the documents this week, but then his father passed away. Brad is currently in Michigan with his family. I will connect with him after the Holidays to find out if that box has any responsive materials in it. If so, we will of course produce.

         ECF No. 12-5 (“Garthe email”). When Blue Basin and Mr. Laurain did not produce responsive documents by the Court's December 28, 2018 deadline, the instant motions and related filings followed.

         Discussion

         Federal Rule of Civil Procedure (“Fed. R. Civ. P.”) 45(g) permits a court to hold a nonparty in contempt who, having been served, fails without adequate excuse to obey the subpoena or an order related to it. Once the moving party demonstrates by clear and convincing evidence that the contemnor has violated a clear and specific court order, the burden shifts to the contemnor to demonstrate that he or she took every reasonable step to comply, and to articulate reasons why compliance was not possible. Bademyan v. Receivable Mgm't Services Corp., No. 2:11-cv-00154-GMN-NJK, 2009 WL 605789, *2 (D. Nev. March 9, 2009). The “clear and convincing” standard is more demanding than the preponderance of the evidence standard generally applicable in civil cases. Battaglia v. United States, 653 F.2d 419, 422 (9th Cir. 1981); United States v. Powers, 629 F.2d 619, 626 n.6 (9th Cir. 1980). To assess the extent to which the contemnor has taken “every reasonable step” to comply with the court order, the court may consider (1) a history of noncompliance, and (2) a failure to comply despite the pendency of a contempt motion. Bademyan, 2009 WL 605789 at *2 (citations omitted).

         As a threshold matter, the Court finds Magistrate Judge George W. Foley, Jr.'s December 19, 2018 Order was clear and specific: “Blue Basin shall produce all responsive documents, requested by the topics set forth in the Subpoena no later than December 28, 2018.” ECF No. 11 at 2:10-12. Further, as explained below, the Court also finds LNC has demonstrated by clear and convincing evidence that Blue Basin and Mr. Laurain violated the abovementioned Order. The Court further finds Blue Basin and Mr. Laurain failed to take any reasonable steps to comply with the Order considering the interested parties' history of noncompliance despite having previously been held in contempt.

         LNC argues Blue Basin should be held in contempt for failing to comply with this Court's order to produce responsive documents to its subpoena. ECF No. 13 at 5:11-13. LNC also argues that Mr. Laurain, Blue Basin's managing member, should be held in contempt, because he told Garthe that he possessed potentially responsive documents, but failed to review and produce them by the deadline. ECF No. 1-4, ¶ 7; ECF No. 12-5; ECF No. 13 at 5:6-7; ECF No. 22 at 8, ¶ 12-14. “Because Mr. Laurain controls Blue Basin, and Blue Basin appears to be insolvent, ” LNC asks the Court to hold Mr. Laurain jointly and severally liable with Blue Basin for all fees and costs awarded in connection with enforcing the subpoena, order Blue Basin and Mr. Laurain to produce the responsive documents immediately without any further delay, and award LNC attorney's fees and costs incurred in connection with this motion. ECF No. 13 at 5:14-16.

         Blue Basin and Mr. Laurain respond to LNC's Motion by saying they are not in contempt because they had no knowledge of the Order until after the deadline to respond had passed. ECF No. 18 at 4:10-6:17. Specifically, Blue Basin states it had notice of this Court's Order for the first time on January 4, 2019, when a copy of LNC's Memorandum of Fees and Costs was served on Incorp. ECF No. 18 at 4:19-21. Mr. Laurain states he was never served with a copy of the Order at all. ECF No. 18 at 4:22. On the other hand, LNC argues both Blue Basin and Mr. Laurain first received notice of this Court's Order from LNC's Motion to Compel, which was “undisputedly served at Blue Basin's registered agent [Incorp.] on November 20, 2018.” ECF No. 22 at ...


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