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Carlson v. American Pacific Mortgage Corporation

United States District Court, W.D. Washington

April 24, 2015

AMERICAN PACIFIC MORTGAGE CORPORATION, a California corporation, and JOHN DOES I-IV, Defendants.


RICARDO S. MARTINEZ, District Judge.

This matter comes before the Court pursuant to Motion to Extend Deadlines (Dkt. # 19) and Motion to Extend Pretrial Deadlines (Dkt. # 25) by Defendant American Pacific Mortgage Corporation ("APMC"), as well as Motion to Modify Case Scheduling Order (Dkt. # 27), Second Motion to Compel Responses to Requests for Production (Dkt. # 31), and Third Motion to Compel Responses to Requests for Production (Dkt. # 40) by Plaintiffs Gary and Susan Carlson (the "Carlsons"). The parties suggested a telephonic hearing on the motions to extend, which the Court deems unnecessary. Having considered the parties' briefs and supporting exhibits, as well as the relevant remainder of the record, the Court finds and rules on the pending motions as follows.


Plaintiffs commenced this civil action on April 3, 2014 by filing a Complaint in King County Superior Court, which Defendant APMC removed to this Court on the basis of its federal question jurisdiction. See Dkt. # 1. Plaintiffs, former APMC executives, asserted that their respective employment agreements entitled them to bonuses based upon profitability, that APMC kept improper financial records, and that APMC wrongfully terminated Plaintiffs' employment when they inquired about unpaid bonuses in violation of 12 U.S.C. § 5567. Dkt. # 1-1 ("Compl."). Defendants counterclaimed for overpayment of wages, trade defamation, and breach of fiduciary duty/duty of loyalty, seeking an award of over $1, 000, 000 in damages. See Dkt. # 3; Dkt. # 8, Ex. 1 ("Evans Decl.") ¶ 5.

On January 30, 2015, the Court entered an Order on Plaintiff's first motion to compel, directing APMC to produce responsive documents within thirty days and to pay Plaintiffs' reasonable expenses associated with bringing its motion. Dkt. # 16. Shortly prior to this deadline, Defendant filed the instant request to extend the deadline for production of these documents by at least 60 days in light of the substantial volume of responsive material (approximately 137, 000 pages of documents). Dkt. # 19. This request was followed by two additional motions to modify the case scheduling order, one by Plaintiffs and one by Defendant, proposing different deadlines for production of expert reports, discovery cutoff, and discovery-related motions. Dkt. ## 25, 27. Finally, Plaintiffs filed two related motions to compel detailed below. Dkt. ## 31, 40. The instant Order resolves all pending Motions.


A. Motions to Extend Deadlines

The Court first considers Defendant's request for a 60-day extension until May 2, 2015 to produce documents responsive to Plaintiffs' Requests for Production ("RFPs") No.'s 7 through 33. A Court's scheduling order may be modified under Federal Rule of Civil Procedure 16(b) "upon a showing of good cause." Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th Cir. 1992). The district court may modify the pre-trial schedule if it cannot reasonably be met despite the diligence of the party seeking the extension. Id. The Court finds these standards met with respect to APMC's request for a continuance, in light of the substantial volume of responsive material and APMC's good faith efforts to comply with the Court-ordered deadline. The Court further finds that Plaintiffs will not be prejudiced by the extension, particularly in light of the continuance of discovery-related deadlines outlined below. Accordingly, APMC's request to continue the deadline to respond to RFP's 7 through 33 shall be granted.

Plaintiffs and Defendant have both moved for additional modifications to the Court's Scheduling Order. See Dkt. ## 25, 27. First, both parties agree that an extension of the deadline for disclosure of expert reports is necessary, as the parties have been unable to agree on the production of certain financial documents that would likely be considered by the experts. The parties disagree solely on the scope of the extension. Plaintiffs assert that the extension should not apply to APMC, which did not timely disclose an expert. Plaintiffs also ask that the expert report disclosure deadline be extended to May 29, 2015, rather than April 27, 2015 as suggested by APMC, to allow the experts time to assimilate the financial data that APMC anticipates it will disclose by the end of April. See Dkt. # 26, ¶ 9 (Chappel Decl.).

The Court agrees with Defendant that the deadline should be moved with respect to both disclosure of the identity of experts and the experts' reports. As Federal Rule of Civil Procedure 26(a)(2) explicitly contemplates both the disclosure of expert identities and reports by the Court-ordered deadline, the Court finds no reason to parse this deadline in the way that Plaintiffs request. In light of the Court's decision herein to extend the deadline for Defendant's disclosures and its decision on Plaintiffs' requests to compel, the Court finds it appropriate to extend the deadline for expert witness disclosures to May 29, 2015, as suggested by Plaintiffs. The Court notes that the Federal Rules allow for supplementation such that no further extension of this deadline should be necessary. See Fed.R.Civ.P. 26(a)(2)(E); Fed.R.Civ.P. 26(e).

As to discovery, both parties agree on an extension of the discovery-related motions deadline from April 13, 2015 to May 28, 2015 but disagree as to an extension of the deadline for the cutoff of discovery itself, currently set for May 11, 2015. Plaintiffs request an extension solely for expert witnesses' depositions ( see Dkt. # 28, pp. 2-3), while Defendant asserts that the substantial volume of production contemplated coupled with the exigencies of its contemporaneous audit period necessitate an extension of the discovery period in its entirety. The Court agrees with APMC, particularly in light of its decisions herein on Plaintiffs' requests to compel, and shall accordingly move the discovery period cutoff to June 25, 2015. As Defendant represents, this extension should not delay the trial date for this case. In light of this extension, the Court finds it appropriate to also extend the dispositive motions deadline to July 25, 2015, thirty days after the close of discovery. See Fed.R.Civ.P. 56(b).

B. Motions to Compel

Through their Second Motion to Compel Discovery Reponses, Plaintiffs move the Court to compel APMC to produce documents in response to RPF No.'s 6 and 7. Through RFP No. 7, Plaintiffs seek production of documents reflecting the sale of retail loans opened during Plaintiffs' employment with APMC, including those related to bulk sales and service release premiums. Defendant asserts that the requested documents related to APMC's sale of retail loans on the secondary market are irrelevant, as the profits that APMC may have made in the capital or secondary market would not have been used as a basis for the calculation of Plaintiffs' bonuses. Defendant also asserts that RFP No. 6, which seeks production of documents reflecting bonus calculations for any APMC Washington employee, is overbroad, in that it would require production of documents related to fixed bonuses, signing bonuses, and other bonuses unrelated to the performance-based bonuses to which Plaintiffs assert they were contractually entitled.

Plaintiffs' Third Motion to Compel Discovery Responses moves the Court to compel disclosure of retail loan related documents for loans closed on after the termination of Plaintiffs' employment (RFP No.'s 1 and 2), which Plaintiffs contend are relevant to their compensation for lost wages should their employment termination be found wrongful. AMPC objects to this request on the same relevancy ground asserted in response to RFP No. 7. Plaintiffs also seek an order compelling APMC to identify specific documents among those already disclosed that are responsive to Plaintiffs' request for emails among APMC employees regarding the Carlsons' employment performance and termination (RFP No.'s 3-6). Defendant ...

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