Californians for Alternatives to Toxics v. Reichardt Duck Farm, Inc

Background

This discovery order resolves the parties’ April 24 dispute about defendants’ document production. The plaintiff asked the court to require defendants to finish producing outstanding documents within one week. The court noted that the fact-discovery cutoff was May 29, 2024, and that the plaintiff had not explained why it needed the documents within a week or identified prejudice from waiting.

Production Deadline

The court did not set a deadline for defendants to complete their production. It said defendants could not simply wait until the discovery cutoff and directed them to identify a date by which they would finalize production. If the plaintiff believed that date was too late, it would need to explain why the documents were needed sooner. The court characterized the lack of specificity in defendants’ response as a matter for the parties’ meet-and-confer process.

Corporate Defendant’s Tax Returns

The court ordered Reichardt Duck Farm, Inc. (RDF) to produce its federal income tax returns from October 21, 2017, to the present in response to Request for Production 32. The court found RDF’s financial condition relevant to the possible amount of civil penalties under the Clean Water Act, even though liability had not been established and the case had not been divided into separate liability and penalty phases.

The court rejected RDF’s objection based on the policy against unnecessary public disclosure of tax returns because a protective order prohibited the plaintiff from publicly disclosing defendants’ confidential information. RDF did not have to produce all source documents underlying the returns, such as every tax form used to prepare them. The court stated that the tax returns were relevant but that a full audit was not warranted.

Individual Defendant’s Financial Information

The plaintiff asked John Reichardt to produce tax returns, Internal Revenue Service Forms 1099, and documents showing his income and net worth for the same period. Reichardt had produced W-2 forms but no other personal financial information.

For now, the court did not require Reichardt to produce additional financial information. It said the plaintiff’s theory of liability against him was unclear because the complaint did not identify actions he had taken. The court noted that the plaintiff had not clearly stated whether it sought to hold Reichardt responsible for RDF’s acts or identified legal authority supporting that theory in this context. The plaintiff may renew the request in a new joint statement, but the court will not compel the additional information unless the plaintiff makes a more persuasive showing that it is relevant.

Disposition

The court did not set the requested one-week production deadline, ordered RDF to produce the specified tax returns subject to the limitations stated in the order, and did not compel John Reichardt to produce additional financial information at that time. Each side must bear its own costs for the discovery dispute. Judge Alex G. Tse signed the order on May 5, 2023.