Opinion
No. EDCV 04-00759-VAP (SSx) [consolidated with Case No, EDCV 03-00079-VAP (SSx)].
June 10, 2005
I. INTRODUCTION
This is an action arising out of certain operations on a 160 acre parcel of land in Rialto, California by a corporation known as the West Coast Loading Corporation (a predecessor of the named defendant, Emhart Industries, Inc. ("EII")) and plaintiff The B.F. Goodrich Company ("Goodrich"). Goodrich has filed a Motion to Compel Production of Documents And Answers To Interrogatories And To Determine the Sufficiency of Responses to Requests for Admissions (the "Motion"). A. Goodrich's Contentions
Goodrich served discovery on EII requesting information and documents regarding West Coast Loading Corporation ("WCLC"), Kwikset Locks, Inc. ("KLI"), Kwikset Corporation ("Kwikset"), American Hardware Corporation ("AHC") and EII. (Joint Stipulation ("Jt. Stip." at 3). Goodrich has named each of these entities as a defendant in this action. Goodrich asserts in its complaint that WCLC, KLI and AHC are all corporate predecessors to EII. (Id.). Goodrich claims that EII has access to information and documents regarding these entities. However, EII claims that WCLC, KLI and AHC are no longer in existence. (Id.).
Included in Goodrich's discovery were definitions of certain terms. One of those definitions was for the terms "you" or "your." Goodrich defined these terms as:
"YOU" and "YOUR," as used in these Requests, mean and refer to the defendant EMHART, and any of its subsidiaries, agents, employees, and/or representatives, and includes any and all other natural PERSONS, businesses or legal entities, acting or purporting to act on behalf of or for YOU, including, but not limited to, all technical or expert consultants or contractors retained or hired by YOU. The term "YOU" and "YOUR" also specifically includes all of YOUR corporate predecessors and related entities, including, but not limited to, West Coast Loading Corporation, Kwikset Locks, Inc., American Hardware Corporation, Black and Decker, Inc., Emhart Manufacturing Company, Emhart Corporation, and Emhart Industries, Inc.
(Fellers Decl., Exh. C at 6-7).
After receiving discovery, EII asserted that WCLA, KLI and AHC are separate and distinct entities and therefore EII could not respond to discovery on their behalf. (Jt. Stip. at 4). Specifically, EII asserted the following objection:
EII [Emhart] objects to the definition of "YOU" and "YOUR" on the grounds that it is vague, ambiguous, overly broad, unduly burdensome, circular, compound and not reasonably calculated to lead to the discovery of admissible evidence. For purposes of these responses, the terms "YOU" AND "YOUR" have been interpreted to mean and refer exclusively to Emhart Industries, Inc., a Connecticut corporation in dissolution. Also, for purposes of these responses the term "EII" refers exclusively to Emhart Industries, Inc., a Connecticut corporation in dissolution. EII objects to the definition of these terms as overly broad, unduly burdensome, and not reasonably calculated to lead to the discovery of admissible evidence to the extent that it includes entities other than EII and various entities and individuals that EII does not control. EII specifically objects to the undefined phrase "YOUR corporate successors and predecessors and related entities" as vague, ambiguous and overbroad. EII objects to this definition in that it erroneously conflates EII with separate and distinct entities, which are neither EII's successors or predecessors, and which are not entities "related" to EII. EII is responding to these requests for production solely on behalf of EII. . . .
(Fellers Decl., Exh. H at 3-4).
Goodrich disagrees, stating that EII must respond to the discovery requests on behalf of all the named entities since all of the entities share a unity of interest and common legal representation. Furthermore, Goodrich cannot obtain the information directly from these entities because they are no longer viable companies. Goodrich believes that EII possesses the relevant information. (Jt. Stip. at 4).
In the declaration of Jeffrey Dintzer, counsel for Goodrich, he describes several meet and confers concerning discovery disputes. He states that at the February 8, 2005 meet and confer, Robert Wyatt, lead counsel for EII, was unwilling to discuss in any detail whatsoever any form of compromise. (Dintzer Decl. ¶ 5). According to Dintzer, Wyatt insisted that Goodrich serve various other entities (some of whom are not parties and some who are dissolved corporations). (Id.).
On March 30, 2005, Goodrich served its portion of the Joint Stipulation. Although Dintzer acknowledges that certain issues were resolved on April 5, 2005, the extent of that resolution is unclear from the papers. B. EII's Contentions
EII represents that many of the issues presented in Goodrich's Motion were resolved by the parties during a meet and confer held on April 5, 2005. (Jt. Stip. at 8). Nonetheless, according to EII, Goodrich decided to file the Motion as originally drafted and served on March 30, 2005, so that the resolved matters remained in the Joint Stipulation as contested matters. (Id.). In the declaration of Gary Sloboda, he states that he met and conferred with Elizabeth Klein, Goodrich's counsel, for approximately 50 minutes regarding the current issues. According to Sloboda, the parties reached a resolution on most of the matters raised in the present motion. (Sloboda Decl. ¶ 5). He states that the parties resolved their disputes concerning Goodrich's document requests and requests for admissions that incorporate Goodrich's definition of "you" and "your." (Id.). However, despite this agreement, Goodrich filed its motion as originally drafted. (Id. at 6).
II. DISCOVERY REQUESTS/ISSUES IN DISPUTE
A. The Motion to Compel Further Responses to the Requests for Admissions Is Moot as the Parties Reached an Agreement on This Dispute
The parties agreed that Goodrich would re-serve the Request for Admissions and direct the Requests to the specific party involved. This resolution is documented in the Exhibits to the Supplemental Memorandum filed by EII and was also confirmed by the parties during the telephonic hearing. As the parties have reached an agreement on the Requests for Admissions, the Court considers the Motion to be moot as to those discovery requests and DENIES the Motion on that ground. However, the Court's ruling is based upon its understanding that Goodrich will reserve the Request for Admissions and will serve a separate set for each entity. The Court anticipates that EII will serve appropriate responses to the Request for Admissions within 30 days of service.
B. Further Responses to Goodrich's Interrogatories and Request for Production Are Required
Goodrich contends that EII's rejection of Goodrich's definition of "you" or "your" as including WCLC, Kwikset, AHC, and other entities is improper. (Jt. Stip. at 14-15). Goodrich argues that EII is merely being evasive and/or hiding behind a "corporate veil" and should be required to answer on behalf of all the identified entities. (Jt. Stip. at 17-18). EII contends that the Federal Rules do not require it to answer discovery requests on behalf of other entities, including subsidiaries or affiliated corporations.
1. EII Is Required to Provide All Responsive Information Within Its Possession, Even If That Information Pertains to Predecessor Corporations or Other Corporate Entities
Clearly, the relationship between EII and the corporate entities described in the definition of "you" or "your" is material and relevant to the legal issues raised by the pleadings. If EII has information in its possession, custody or control pertaining to these other entities, it must be produced.
In paragraph 8 of EII's Answer to the First Amended Complaint, EII sets forth the relationship between WCLC, KLI, American Hardware Corporation, Emhart Manufacturing Company, Emhart Corporation and Emhart Industries, Inc.
The cases that have examined this issue have reached a consistent result. A corporation responding to interrogatories must provide not only the information contained in its own files and possessed by its own employees, but also all information under its control. American Rockwool, Inc. v. Owens-Corning Fiberglas Corp., 109 F.R.D. 263, 266 (E.D.N.C. 1985). Accordingly, "when the parent is served with an interrogatory, it is no defense to claim that the information is within the possession of a wholly owned subsidiary, because such a corporation is owned and controlled by such interrogee."Westinghouse Credit Corp. v. Mountain States Mining Milling Co., 37 F.R.D. 348, 349 (D. Col. 1965); see also Brunswick Corporation v. Suzuki Motor Company, Ltd., 96 F.R.D. 684, 685 (E.D. Wis. 1983) (corporation must answer interrogatories on behalf of its subsidiaries).
The discovery rules require that a corporation furnish such information as is available from the corporation itself or from sources under its control. Westinghouse, 37 F.R.D. at 349. If the corporation can obtain the information from sources under its control, it may not avoid answering by alleging ignorance.Greenbie v. Noble, 18 F.R.D. 414, 415 (S.D.N.Y. 1955) (corporate defendant must answer all interrogatories seeking information under the control of the corporation, even though interrogatory sought information about subsidiary corporation which was not a party and related to defendant only through stock ownership); see also Sol S. Turnoff Drug Distributors Inc. v. N.V. Nederlandsche Combinatie, etc., 55 F.R.D. 347, 349 (E.D. Pa. 1972) (corporation must respond to discovery on behalf of subsidiaries or predecessor corporations). However, if the information is truly not "available" to the corporation, i.e., it is not in their possession and the responding corporation cannot exercise control over it, then the responding corporation may state this fact in response. Erong Corporation v. Skouras Theatres Corporation, 22 F.R.D. 494, 498 (S.D.N.Y. 1958).
Thus, EII's objection is improper. EII cannot refuse to respond on the grounds that Goodrich seeks information about "separate entities." Even if Goodrich sought information from EII that was generated by a corporate entity that never had any connection with EII, but EII somehow obtained possession of that entity's documents or information, EII would be required to produce that information. EII's objection to the definition of "you" and "your" is overruled. EII must serve supplemental responses to the interrogatories and request for production and must provide all responsive information available from EII or from "sources under [EII's] control."
2. EII's Objection to the Definition of Hazardous Substance and Hazardous Waste Is Improper
EII objected to the definition of "Hazardous Substance" included in the requests by stating that the definition was "compound, overly broad, unduly burdensome, vague, ambiguous and uses undefined or uncertain terms." (Jt. Stip. at 31). EII also objected on the grounds that the substances in question "ceased to exist" nearly fifty years ago and it is impossible to locate or test the substances. (Jt. Stip. at 32). EII makes similar assertions in connection with the definition of "Hazardous Waste."
As Goodrich points out, EII used the same definitions in its discovery to Goodrich. (Jt. Stip. at 33; Fellers Decl., Exh. B (EII's First Demand for Production of Documents, Definitions 10, 11)). Thus, on its face, EII's objection to its own definition of terms seems questionable. Moreover, the definition's language is lifted from the CERCLA statute itself. EII's contention that the definition is somehow vague or ambiguous may be EII's suggestion that the statute itself is unclear — but the Court disagrees and concludes that the definitions are appropriate in the context of this litigation. The objection is therefore rejected.
3. EII's Proposed Compromise to the Dispute Over "Corporate History" is Reasonable
In EII's portion of the Joint Stipulation, EII proposed a compromise to resolve its objection to the term "corporate history." EII offered to provide discoverable documents within its possession, custody or control regarding the corporate history of the entities specified in request nos. 22-28, "to the extent the documents relate to the merger of WCLC into KLI, the dissolution of KLI, and the subsequent operation of KLI as a division of American Hardware Corporation." (Jt. Stip. at 39).
The Court finds that this is a reasonable solution to the concerns raised by both Goodrich and EII. Therefore, EII will be required to respond to the discovery requests including the term "corporate history" to the extent the information or documents requested relate to the merger of WCLC into KLI, the dissolution of KLI, and the subsequent operation of KLI as a division of American Hardware Corporation.
4. Goodrich's Requests for Production Nos. 154-160 Are Overbroad
Goodrich's requests for production nos. 154-160 seek all documents that refer or relate to the various corporate entities related to EII. (Jt. Stip. at 40-49). EII objected on multiple grounds, including that the requests were overbroad, burdensome and oppressive. The Court agrees that the requests are overbroad. The range of documents requested is extremely broad and there are no specific descriptions of documents or time limitations imposed. Thus, the objection is upheld and EII need not respond to these requests.
However, the Court recognizes that a subset of documents which would be included in the very broad categories of documents described in request nos. 154-160 are likely to be relevant to the successor liability issue. As such, Goodrich is free to seek these documents through a limited number of additional requests for production. These requests must be limited to seeking only those documents that are truly essential and material to determining the successor issue. Goodrich must use specific and narrow language to describe the documents it is seeking. Goodrich must also include reasonable time period limitations on the requests.
As the original requests involved six separate requests for production, there should be no increase in the number of requests if the requests are redrafted and reserved.
If such requests are served by Goodrich, EII is required to produce only responsive documents within its possession, custody or control (or from sources under its control). A responding party is not required to "create" documents to respond to a discovery request. Alexander v. FBI, 194 F.R.D. 305, 310 (D.D.C. 2000).
III. EII's REQUEST FOR SANCTIONS
The Court finds that many of the disputes raised in the Joint Stipulation could have been resolved by further meet and confers. Court intervention was clearly unnecessary to resolve several of these disagreements. Even if a party proposes a compromise after the Motion to Compel is filed, it is the professional responsibility of the moving party to determine if any compromise can be effectuated before the Court issues a ruling. The Court generally takes into consideration the reasonableness of a party's position with regard to proposed compromises when the Court is faced with a sanctions request. In addition, Rule 37(a) (4) (C) directs that when a court grants in part and denies in part a motion to compel further discovery, the court retains the discretion to decide whether reasonable expenses should be apportioned among the parties.
After considering the Joint Stipulation, Supplemental Memorandum from each party, declarations and exhibits, the Court concludes that neither side is blameless. Both parties contributed in different ways to the failure of the meet and confer process. Both sides had some merit to the contentions they raised in the discovery papers, yet both probably could have compromised more on their positions during the meet and confer process. The Court, in the exercise of its discretion, therefore determines that no award is justified.
IV. CONCLUSION
For the reasons stated above, Goodrich's Motion to Compel is GRANTED in part and DENIED in part. The Court issues the following Order:
1) EII must serve supplemental responses to Goodrich's Interrogatories and must withdraw its Objections to the definitions of "you" and "your," "Hazardous Waste and Substance," within 30 days of the date of this Order. EII will be required to respond to the discovery requests including the term "corporate history" to the extent the information requested relates to the merger of WCLC into KLI, the dissolution of KLI, and the subsequent operation of KLI as a division of American Hardware Corporation. EII must provide all information that is responsive to the interrogatories and that is within EII's control. To the extent EII or any source under its control does not possess responsive information, EII must so state.
2) EII must serve supplemental responses to the requests for production identified in Goodrich's Motion to Compel, except request nos. 154-160 (addressed in no. 4, below). EII must withdraw its Objections to the definitions of "you" and "your," "Hazardous Waste and Substance." EII will be required to respond to the discovery requests including the term "corporate history" to the extent the documents requested relate to the merger of WCLC into KLI, the dissolution of KLI, and the subsequent operation of KLI as a division of American Hardware Corporation. The supplemental responses must be served within 30 days of the date of this Order. EII must provide all responsive documents within 30 days of the date of this Order. EII must provide all documents that are responsive to the requests and that are within EII's control. To the extent EII or any source under its control does not possess responsive information, EII must so state.
3) Goodrich must reserve the Request for Admissions and direct a separate set to each responding party. EII must respond within 30 days of the date of service.
4) EII is not required to respond to request for production nos. 154-160, as currently written.
5) EII's request for Sanctions is DENIED.
IT IS SO ORDERED.