United States District Court, E.D. Washington
BLOCKTREE PROPERTIES, LLC, a Washington limited liability company; CORSAIR INVESTMENTS, WA, LLC, a Washington limited liability company; CYTLINE, LLC, a Delaware limited liability company; 509 MINE, LLC, a Washington limited liability company; MIM INVESTORS, LLC, a Washington limited liability company; MINERS UNITED, LLC, a Washington limited liability company; MARK VARGAS, an individual; WEHASH TECHNOLOGY, LLP, a Washington limited liability company; Plaintiff,
PUBLIC UTILITY DISTRICT NO. 2 OF GRANT COUNTY WASHINGTON, a Washington municipal corporation; TERRY BREWER, individually and in his official capacity; BOB BERND, individually and in his official capacity; DALE WALKER, individually and in his official capacity; TOM FLINT, individually and in his official capacity; LARRY SCHAAPMAN, individually and in his official capacity; NELSON COX, individually and in his official capacity; JUDY WILSON, individually and in her official capacity; and DOES 1-10, managers and employees of Grant PUD, individually and in their official capacities; Defendants.
ORDER GRANTING PLAINTIFFS' MOTION TO DEFER
CONSIDERATION OF MOTION FOR SUMMARY JUDGMENT
Rosanna Malouf Peterson United States District Judge.
THE COURT is Plaintiffs' Motion to Defer Consideration of
Defendants' Motion for Summary Judgment under Rule 56(d),
ECF No. 74. Plaintiffs move to defer hearing Defendants'
Motion for Summary Judgment until discovery is completed.
Id. A hearing on Defendants' Motion for Summary
Judgment is scheduled for June 27, 2019. ECF No. 65. Having
considered the briefing and the record, the Court is fully
are several cryptocurrency miners with operations located in
Grant County, Washington. ECF No. 81 at 4-6. Defendants are
Grant County Public Utility District Number 2, its
Commissioners, and some of its employees. Id. at
6-7. Plaintiffs allege that Defendants violated Washington
law, the Washington State Constitution, Federal law, and the
United States Constitution by adopting and implementing Rate
Schedule 17 (“RS-17”), which is an electrical
rate that applies to certain “evolving industries,
” and a priority queue system that places
“evolving industries” at the end of the
electrical services application queue. Id. at 37-46.
Plaintiffs previously moved for a preliminary injunction
enjoining the implementation of RS-17 throughout this
lawsuit, ECF No. 25, but the Court denied Plaintiff's
motion. Blocktree Props., LLC v. Pub. Util. Dist. No. 2
of Grant Cty., Wash., No. 2:18-CV-390-RMP, 2019 WL
1429998 (E.D. Wash. Mar. 29, 2019). Plaintiffs have appealed
the Court's order denying their motion for preliminary
injunction to the Ninth Circuit, which is still pending. ECF
Defendants filed a motion for summary judgment on all eight
of Plaintiffs' claims. ECF No. 65. Plaintiffs filed a
response to Defendants' motion, ECF No. 69, but also
filed the present motion to defer ruling on Defendants'
motion. ECF No. 74. Plaintiffs argue that they have not had a
chance to conduct discovery and that discovery will yield
additional information pertinent to its claims against
Defendants. Id. Defendants argue that Plaintiffs
already have received extensive information regarding RS-17
and the evolving industries queue from Plaintiffs' public
records requests, and that any additional discovery will be
futile. ECF No. 79. Pursuant to the Scheduling Order, the
parties are permitted to seek discovery until October 4,
2019. ECF No. 39 at 4. Dispositive motions, including motions
for summary judgment, must be filed by October 25, 2019.
Id. at 5.
Federal Rule of Civil Procedure 56, “a party may file a
motion for summary judgment at any time until 30 days after
the close of all discovery.” Fed.R.Civ.P. 56(b).
However, “[i]f a nonmovant shows by affidavit or
declaration that, for specified reasons, it cannot present
facts essential to justify its opposition, the court may: (1)
defer considering the motion or deny it; (2) allow time to
obtain affidavits or declarations or to take discovery; or
(3) issue any other appropriate order.” Fed.R.Civ.P.
56(d). Summary judgment cannot be granted “where the
nonmoving party has not had the opportunity to discover
information that is essential to [its] opposition.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250
n.5 (1986). If the Rule 56(d) requirements are met, then the
district court should defer ruling on the motion for summary
judgment. Metabolife Int'l, Inc. v. Wornick, 264
F.3d 832, 846 (9th Cir. 2001). If summary judgment is filed
“before a party has had any realistic opportunity to
pursue discovery relating to its theory of the case, district
courts should grant any Rule 56[(d)] motion fairly
freely.” Burlington N. Santa Fe R.R. Co. v.
Assiniboine & Sioux Tribes of Fort Peck Reservation,
323 F.3d 767, 773 (9th Cir. 2003).
district court should defer ruling on a motion for summary
judgment when “the party opposing summary judgment
makes (a) a timely application which (b) specifically
identifies (c) relevant information, (d) where there is some
basis for believing that the information actually
exists.” VISA Int'l Serv. Ass'n v. Bankcard
Holders of Am., 784 F.2d 1472, 1475 (9th Cir. 1986).
Deferral is especially appropriate where the material sought
is the subject of outstanding discovery requests.
Id. However, a Rule 56(d) motion may be denied when
the party seeking deferral has not diligently sought
discovery or additional discovery would be futile or
irrelevant to the dispute. Pfingston v. Ronan Eng'g
Co., 284 F.3d 999, 1005 (9th Cir. 2002); Nordstrom,
Inc. v. Chubb & Son, Inc., 54 F.3d 1424, 1436 (9th
Cir. 1995). Ultimately, the district court's decision on
a Rule 56(d) motion is within the district court's
discretion. Burlington N., 323 F.3d at 773.
only requirement before the Court may consider deferring a
ruling on a parties' summary judgment motion is that the
nonmovant “shows by affidavit or declaration that, for
specified reasons, it cannot present facts essential to
justify its opposition.” Fed.R.Civ.P. 56(d). Plaintiffs
filed a declaration in support of their motion explaining
that they have not yet begun discovery in this case. ECF No.
74-2. However, Plaintiffs state that they have received some
documents from preliminary public records requests, and are
set to receive more on June 21, 2019, just six days before
the parties are set to argue Defendants' summary judgment
motion. Id. at 2. They also identified several areas
in which further discovery must be conducted in order to
fully support their claims against Defendants. Id.
at 3. The Court finds that Plaintiffs have met Rule
56(d)'s prerequisite of showing, by declaration,
specified reasons that they cannot present facts essential to
justifying their opposition to Defendants' summary
judgment motion. Fed.R.Civ.P. 56(d).
Plaintiffs have met the only Rule 56(d) requirement, the
Court considers the VISA factors to determine
whether it should grant Plaintiffs' motion, which are
“(a) a timely application which (b) specifically
identifies (c) relevant information, (d) where there is some
basis for believing that the information actually exists,
” and, additionally, whether “the material sought
is also the subject of outstanding discovery requests.”
VISA, 784 F.2d at 1475. As to the first factor,
Plaintiffs' motion is timely, as it is made before the
Court heard the summary judgment motion. ECF No. 74 at 6. The
first VISA factor favors granting Plaintiffs'
second VISA factor is that the information sought by
the party opposing summary judgment is specifically
identified. VISA, 784 F.2d at 1475. Plaintiffs'
motion specifically identifies several areas that Plaintiffs
want to explore before the close of discovery. ECF No. 74-2.
They state that they want to conduct discovery on
Defendants' cost-of-service model; the actual load on
Defendants' power grid caused by cryptocurrency miners;
the effects of the evolving industry queue; damages suffered
by Defendants as a result of cryptocurrency miners, if any;
any discriminatory motives Defendants might have fostered
against cryptocurrency miners; the decision-making process
that classified cryptocurrency miners as an evolving
industry; or any alternatives to RS-17 considered by
Defendants before implementing RS-17; among other topics.
Id. The Court finds that Plaintiffs have
specifically identified the information that it seeks, so the
second VISA factor favors granting Plaintiffs'
third VISA factor is that the information sought by
the nonmovant is relevant to the summary judgment motion.
VISA, 784 F.2d at 1475. Defendants argue that the
information sought by Plaintiffs is irrelevant because the
facts are undisputed, and Plaintiffs' claims only present
the Court with questions of law. ECF No. 79 at 6. However,
Defendants' arguments ignore the standards by which the
Court must scrutinize RS-17. For example, regarding
Plaintiffs' claim that RS-17 is arbitrary and capricious
under Washington's utility ratemaking laws, an action is
arbitrary and capricious when it is “willful and
unreasoning and taken without regard to the attending facts
or circumstances.” Hillis v. State Dep't of
Ecology, 932 P.2d 139, 144 (Wash. 1997). Further, an
action is arbitrary and capricious when “there is no
support in the record for the action.” Dorsten v.
Port of Skagit Cty., 650 P.2d 220, 224 (Wash.Ct.App.
1982). While these two cases only apply to one of
Plaintiffs' eight claims, they show that further
discovery must be conducted in order for Plaintiffs to prove
their allegations against Defendants. Burlington N.,
323 F.3d at 773 (holding that a Rule 56(d) motion should be
granted if a party has not had a “realistic opportunity
to pursue discovery relating to its theory of the
case”). The Court finds that the third VISA
factor favors granting Plaintiffs' motion.
fourth VISA factor is that there is some basis for
believing that the information sought actually exists.
VISA, 784 F.2d at 1475. While it may be difficult to
predict what is or is not available in discovery, Plaintiffs
already possess evidence from their public records request
that indicate that further information is available on
certain topics. For example, Plaintiffs attest by declaration
that they have reason to believe that the assumptions upon
which RS-17 was created are incorrect based on certain
documents received from public records requests, but that
they need to conduct more discovery into these assumptions to
oppose Defendants' summary judgment motion. ECF No. 74-2
at 6-7. Additionally, Plaintiffs attest that they have not
had a chance to conduct discovery on the evolving ...