SGM Holdings LLC v. Andrews

Background

Plaintiffs SGM Holdings LLC, Richard Featherly, James T. Hughes, Premier Natural Resources LLC, and Syndicated Geo Management Corporation brought this action against A James Andrews, Richard Gaines, and Karl Schledwitz. The action began on October 15, 2015, and plaintiffs filed an amended complaint on January 15, 2021. The opinion states that the original and amended complaints were “virtually identical.”

Under the most recent case-management plan, fact discovery closed on March 16, 2022, and expert discovery closed on April 29, 2022. The parties filed cross-motions for summary judgment in November 2022, and Judge Paul A. Crotty denied those motions on September 25, 2023.

Earlier Discovery Order

On December 8, 2023, defendant Karl Schledwitz requested additional discovery from plaintiff Charles Stephenson. After a telephone conference, the court partially granted that request. It allowed a continued deposition of Stephenson limited to two hours of on-the-record time and questions about assignments of certain plaintiffs’ claims to Stephenson in September 2020 and plaintiffs’ counsel’s billing records related to those assignments.

The court denied all other discovery requests, including expert discovery, because the requesting party had not shown good cause. It also required the parties to file a joint letter by March 7, 2024, certifying completion of the permitted discovery.

Request at Issue

Defendants asked for permission to serve Stephenson with 15 requests for admission and 10 requests for production concerning relevant paragraphs of the amended complaint. The requests concerned topics about which Stephenson’s counsel had directed him not to respond during the limited continued deposition held on January 29, 2024. Stephenson opposed the request.

Legal Standard

Federal Rule of Civil Procedure 16(b)(4) provides that a court-ordered discovery schedule may be changed only for good cause and with the judge’s consent. The opinion explains that good cause depends on the moving party’s diligence.

Court’s Analysis

The court first found that defendants had not complied with the court’s Individual Practices. Those procedures required the parties to confer before filing a discovery request and required the moving party to provide specific information about that conference, including the opposing party’s position and whether the parties had reached an impasse. The court held that this failure alone justified denying the request.

The court also denied the request on its merits. The December 13 order had clearly limited Stephenson’s deposition to the assignments and related billing records. If defendants believed their deposition questions were within that permitted scope, they could have contacted the court during the deposition for a ruling. Instead, they waited more than a month to raise the issue, doing so after the deadline for completing the deposition and one day after the certification letter was due.

The court further noted that the requested discovery concerned claims in an amended complaint filed more than three years earlier, claims that were nearly identical to those in the original complaint filed more than eight years earlier, and assignments made nearly four years earlier. The court concluded that defendants had not diligently sought the requested discovery and therefore had not shown good cause.

Disposition

The court DENIED defendants’ request. It directed the clerk to close ECF No. 170. Because the parties had not filed the required certification letter, the court deemed all discovery required by the December 13 order complete.