Gao v. Umi Sushi, Inc.

Background

Shiqiang Gao and Jianmin Peng brought claims under the Fair Labor Standards Act and New York Labor Law. The issue in this order was not the merits of those wage claims. Instead, the court reviewed the plaintiffs’ objection to Magistrate Judge Netburn’s October 31, 2019 ruling awarding the defendants attorney’s fees for expenses connected to a discovery-sanctions motion.

The case-management order initially required all fact discovery to be completed by February 1, 2019. After delays and requests for extensions, the parties agreed that the plaintiffs’ depositions would occur on August 15, 2019. The plaintiffs later sought to change the date and informed the defendants that Gao, who had relocated to China, needed to be deposed by video. Judge Netburn extended the discovery deadline to September 16, 2019, for the limited purpose of taking Gao’s deposition by video, and ordered the plaintiffs to pay the video-deposition expenses as a sanction for their delay in bringing Gao’s location to the court’s attention.

The parties then agreed that Gao’s deposition would take place on September 16. Four days before that date, the plaintiffs said Gao could not travel to Hong Kong because of political unrest and requested another seven-day extension. The plaintiffs later confirmed that Gao would appear as scheduled, but the defendants said the late confirmation prevented them from arranging a court reporter. The defendants moved for discovery sanctions, seeking to prevent Gao from testifying and to dismiss the complaint. Judge Netburn granted that motion in part and denied it in part, ordering the plaintiffs to pay the defendants’ reasonable attorney’s fees and costs incurred in bringing the sanctions motion.

Legal standard

Under Federal Rule of Civil Procedure 72(a), a district judge reviewing an objection to a magistrate judge’s order on a nondispositive matter—such as a discovery dispute—may change or set aside the order only if it is clearly erroneous or contrary to law. A finding is clearly erroneous when the district judge is left with a firm conviction that a mistake was made. An order is contrary to law when it fails to apply, or misapplies, relevant law or procedural rules. The court explained that magistrate judges have broad discretion to manage discovery disputes and that a party challenging such an order faces a heavy burden.

Under Rule 37(b)(2), a court may issue appropriate orders when a party fails to comply with a discovery order. The rule also generally requires an award of reasonable expenses, including attorney’s fees, caused by the failure unless the failure was substantially justified or another circumstance makes the award unjust.

Court’s analysis

Judge Carter concluded that Judge Netburn’s August 23 order clearly and unambiguously established September 16, 2019, as the deadline for Gao’s video deposition. He found the plaintiffs’ explanation for failing to comply unpersuasive. The plaintiffs had more than three weeks to arrange the logistics of an overseas deposition but waited until September 12—four days before the deposition—to coordinate Gao’s travel to Hong Kong. The court found that this delay was not reasonably diligent.

Disposition

Judge Carter found that Judge Netburn’s decision was neither contrary to law nor clearly erroneous. The plaintiffs’ objection was DENIED. The parties were also ordered to follow a briefing schedule for summary judgment motions, oppositions, and replies.