Opinion
Civil No. 06cv1022-B(BLM).
July 2, 2008
ORDER GRANTING MOTION FOR SANCTIONS [Doc. No. 124]
Presently before the Court are (1) the Morales Defendants' Motion for Sanctions ("Sanctions Mot.") together with the June 3, 2008 Declaration of Barbara Richards [counsel for the Morales Defendants] ("June 3rd Richards Decl."), (2) the declaration of J. Manuel Sanchez [counsel for Defendant Lopez] in Opposition to Sanctions ("Sanchez Decl."), and (3) the June 19, 2008 Declaration of Barbara Richards in Response to Declaration of Manuel Sanchez ("June 19th Richards Decl."). Doc. Nos. 123, 124 128. This briefing was filed in response to this Court's determination that Mr. Sanchez knowingly and intentionally failed to comply with this Court's December 19, 2007 Order Setting Discovery Cut-Off and Remaining Pretrial Dates and the Court's resulting invitation to the parties to address the appropriate type and extent of sanctions to be imposed. See Doc. No. 121. Upon completion of the briefing, the matter was taken under submission pursuant to Civil Local Rule 7.1(d)(1). Id.
Having reviewed the briefing submitted, and for the reasons set forth below, the Morales Defendants' motion is GRANTED.
BACKGROUND
This interpleader action was filed on May 10, 2006, to determine the proper beneficiary of life insurance proceeds from a policy on the life of Maria F. Lopez ("the decedent"). See Doc. No. 1. The policy named the decedent's spouse, Defendant Juan Javier Lopez, as the sole beneficiary. Id. ¶ 7. However, the decedent's parents, Defendants Ildefonso Morales and Alicia A. Ruiz de Morales, claim they are entitled to the insurance proceeds as their daughter's heirs because Defendant Lopez was convicted by a Mexican court of murdering their daughter. Id. ¶ 8. Defendant Lopez remains incarcerated in Mexico as a result of this conviction. Id.Last year, Defendant Lopez and the Morales Defendants filed cross-motions for summary judgment. Doc. Nos. 26 44. On November 20, 2007, the district judge denied both motions for summary judgment [Doc. No. 86] and, in his subsequent written order, instructed the parties that the case would be set for a bench trial [Doc. No. 89, issued December 10, 2008]. In the same order, the district judge authorized additional discovery, with deadlines to be set by this Court. Doc. No. 89.
This Court held a telephonic, attorneys-only case management conference with attorneys Sanchez and Richards on December 3, 2007, to discuss the additional discovery the parties needed to conduct and the requisite scheduling. See Doc. No. 87, 97. During the conference, attorney Sanchez represented to the Court that he wanted to take a video-deposition of his client in the Mexican prison, and possibly depose one or two other people. However, Mr. Sanchez was unable to provide specific information regarding how the prison deposition would be conducted, nor how long he needed to make the necessary arrangements. Accordingly, the Court continued the hearing to permit Mr. Sanchez to obtain that information.
On December 10, 2007, attorney Sanchez informed attorney Richards and the Court's law clerk that he anticipated needing two months to complete his client's deposition. See Sanctions Mot. at 2. Mr. Sanchez also filed a Status Report detailing the efforts he had expended and indicating the discovery he might pursue. Doc. No. 90. In his written report, Mr. Sanchez did not request a specific discovery deadline. Id.
On December 19, 2007, this Court issued a new Case Management Order, providing the parties with three additional months (more than the two requested by Mr. Sanchez) to conduct discovery. Doc. No. 92. The scheduling order required the parties to complete discovery by March 21, 2008 and defined "completed" as meaning that "all discovery under Rules 30-36 of the Federal Rules of Civil Procedure, and discovery subpoenas under Rule 45, must be initiated a sufficient period of time in advance of the cut-off date, so that it may be completed by the cut-off date, taking into account the times for service, notice, and response as set forth in the Federal Rules of Civil Procedure." Id. (emphasis in original).
On April 8, 2008, more than two weeks after the expiration of the second discovery period, attorney Sanchez sent attorney Richards a letter informing her that he would conduct Defendant Lopez' videotaped deposition on April 14, 2008. Sanchez Decl., Ex. Item 17 at 28; June 3rd Richards Decl. ¶ 3. Attorney Richards responded the same day with a letter objecting to the deposition on the grounds that discovery had closed. June 3rd Richards Decl., Ex. A.
Attorney Sanchez sent a responsive letter on April 9, 2008, expressing concern because he understood attorney Richards to have verbally agreed on March 19, 2008 to attorney Sanchez' proposal to take his client's deposition "within the next two weeks." Sanchez Decl., Ex. Item 18 at 30. He further stated that if attorney Richards did not reconsider her position, he would "be forced to file an emergent ex-parte motion with the court requesting a formal order extending the Discovery cut-off date only as to [his] client's video deposition." Id. Attorney Richards denies ever having agreed to an extension of the March 21, 2008 discovery cut-off. June 19th Richards Decl. ¶ 2.
Attorney Sanchez did not thereafter seek the Court's leave to conduct his client's deposition after the discovery cut-off date. In fact, he did not complete the deposition until April 14, 2008, which was well after the two-week extension of the March 21, 2008 discovery cut-off date, to which he contends attorney Richards informally agreed. See Sanchez Decl. at 2.
Despite the fact that this Court had conducted numerous hearings addressing the parties' discovery issues and the potential difficulties associated with deposing defendant Lopez in a Mexican prison, attorney Sanchez never contacted the Court to request an extension of the discovery deadline due to the difficulties he now claims he encountered. Moreover, attorney Sanchez has not provided any letters, emails or correspondence with attorney Richards in which he confirmed their alleged agreement. And, attorney Sanchez did not contact this Court to request an extension of the applicable deadlines when attorney Richards allegedly disavowed their agreement. All of these facts support the Court's conclusion that attorney Sanchez knowingly and intentionally violated the Court's discovery deadline order by deposing his client on April 14th and that the imposition of sanctions is warranted.
During a status hearing on May 27, 2008, this Court found that sanctions were appropriate for attorney Sanchez' failure to comply with this Court's December 19, 2007 Order Setting Discovery Cut-Off and Remaining Pretrial Dates. Doc. No. 121 (Order Following Status Hearing Setting Deadlines). The Court afforded both attorneys an opportunity to address the type and extent of sanctions to be imposed. Id.
LEGAL STANDARD
Dates set in a scheduling order only may be modified "for good cause and with the judge's consent." Fed.R.Civ.P. 16(b)(4); Doc. No. 92 (scheduling order stating that dates may be modified for "good cause"). If a party fails to comply with the court's scheduling order, the court may, on its own or on motion from a party, impose any just sanction including those authorized by Rule 37(b)(2)(A)(ii)-(vii) of the Federal Rules of Civil Procedure. Fed.R.Civ.P. 16(f)(1); see also Wong v. Regents of Univ. of California, 410 F.3d 1052, 1060 (9th Cir. 2005) (confirming that "[t]he Federal Rules of Civil Procedure explicitly authorize the establishment of schedules and deadlines, in Rule 16(b), and the enforcement of those schedules by the imposition of sanctions, in Rule 16(f)"). In addition to or in lieu of other sanctions, "the court must order the party, its attorney, or both to pay the reasonable expenses — including attorneys fees — incurred because of any noncompliance" unless the noncompliance was "substantially justified or other circumstances make an award of expenses unjust." Fed.R.Civ.P. 16(f)(2); Rodriguez v. Bimbo Bakeries, USA, Inc., 2007 WL 959027, *1-*2 (S.D. Cal. 2007) (awarding as a Rule 16(f) sanction reasonable attorneys fees and costs incurred by opposing counsel as a result of plaintiff's violation of a court order).DISCUSSION
It is undisputed that attorney Sanchez did not conduct Defendant Lopez' deposition within the time frame set by this Court for completing discovery. However, attorney Sanchez argues that he relied, ultimately to his detriment, on an oral agreement with opposing counsel to extend the Court's March 21, 2008 discovery cutoff date. Sanchez Decl. at 2-3. Attorney Richards disputes that such an agreement ever existed and attorney Sanchez has not provided this Court with any evidence, aside from his own unsupported declaration, establishing the existence of such an agreement. Absent some support, and in light of the contentious relationship between counsel, this Court has no legitimate basis for concluding that such an agreement was made.
Even if the parties had reached such an agreement, attorney Sanchez violated the scheduling order because he did not obtain the Court's consent to the alleged discovery deadline extension and parties do not have the authority to unilaterally amend the Court's scheduling order. See Fed.R.Civ.P. 16(b)(4) (dates set in a scheduling order may only be modified "for good cause and with the judge's consent") (emphasis added). Here, attorney Sanchez did not submit a joint motion or other appropriate request to the Court seeking an extension of the discovery deadline based upon the parties' alleged agreement. Moreover, when he reached an impasse with attorney Richards regarding the extension, attorney Sanchez informed opposing counsel that he would seek the Court's permission if she did not agree to the extension (Sanchez Decl., Ex. Item 18 at 30), but he failed to pursue that option. As a result, attorney Sanchez never requested, and this Court never approved, an extension of the March 21, 2008 discovery deadline.
Even now, attorney Sanchez has failed to establish good cause for his failure to depose his client prior to the March 21, 2008 deadline. In his declaration, attorney Sanchez claims he only had three weeks — starting February 28, 2008 when the Court granted his ex parte motion for video deposition — to make the myriad arrangements necessary to conduct the deposition in the Mexican prison. Sanchez Decl. at 8. He contends that this proved to be an insufficient period of time in which to accomplish all of the necessary tasks, despite his diligent efforts. Id. at 9. But, attorney Sanchez' recitation of the facts is somewhat misleading. Attorney Sanchez made clear during the December 3, 2008 case management conference that he wanted to depose his client, but at that time, could not provide the Court with any information as to how he would conduct this deposition or how long it would take to make the necessary arrangements. The Court instructed attorney Sanchez to investigate these issues and be prepared to provide explanations during the conference on December 10, 2008. Thereafter, attorney Sanchez filed a "Status Report" detailing the steps he had taken, but the report did not set forth any specific plan for proceeding or any estimate of the anticipated time frame. See Doc. No. 90. The Court then gave attorney Sanchez three months in which to complete Defendant Lopez' deposition. Doc. No. 92. As a result, attorney Sanchez had three months, not three weeks, to make the necessary arrangements.
However, as previously noted, attorney Sanchez represented to attorney Richards and this Court's law clerk later in the day that he anticipated needing two months to complete his client's deposition.
Had attorney Sanchez been diligently preparing to depose his client, the only arrangement left unresolved in February 2008 should have been how attorney Richards would participate in the deposition (via video-conference, telephonic conference, or subsequent written questions). Once the parties agreed, and the Court ruled on February 28, 2008, that attorney Richards did not have to participate in the oral deposition of defendant Lopez, and could submit written questions after her review of the deposition videotape and transcript, attorney Sanchez should have been ready to immediately depose his client. Under the existing scheduling order, attorney Sanchez then had three weeks to depose his client, utilizing the arrangements he previously should have made.
In his declaration, attorney Sanchez explains that in the weeks after the Court's February 28, 2008 hearing, he engaged in the following activities to finalize his client's deposition: (1) making arrangements for a local court reporter, (2) coordinating with the warden of the prison, (3) obtaining a Mexican Court Order with the names of the individuals authorized to attend the deposition, (4) retaining an actuario to personally serve the Mexican Court Order on the prison warden and actually effecting this service, and (5) making arrangements for the actuario to be present during the deposition. Sanchez Decl. at 8. These arrangements were not contingent on how attorney Richards was going to participate in the deposition. As a result, they could have, and should have, been completed prior to the February 28, 2008 hearing.
Furthermore, to the extent there was a delay in resolving the method by which attorney Richards could participate in defendant Lopez' deposition, it was in large part due to attorney Sanchez' own lack of diligence in determining the technological capabilities of the prison. The Rule 16 "good cause" standard focuses on the "reasonable diligence" of the moving party. Noyes v. Kelly Services, 488 F.3d 1163, 1174 n. 6 (9th Cir. 2007); Coleman v. Quaker Oats Company, 232 F.3d 1271, 1294 (9th Cir. 2000) (Rule 16(b) scheduling order may be modified for "good cause" based primarily on diligence of moving party). Diligence should not be confused with carelessness, which offers no reason for a grant of relief. Johnson v. Mammoth Recreations, Inc., 975 F.2d 604, 609 (9th Cir. 1992). "If [the moving] party was not diligent, the inquiry should end." Id.
Here, the Court instructed counsel to be prepared to present facts and evidence at the February 22, 2008 hearing on Defendant Lopez' motion confirming that it either would or would not be possible to conduct a video-conferenced or telephonic deposition from the prison and, if such a deposition were possible, exactly how it would be done (what technology would be used, who would initiate the call, etc.). At the hearing, attorney Sanchez was not able to provide the Court with any evidence as to whether or not the prison had any internet or telephone capabilities, so the Court found it necessary to continue the hearing to February 28, 2008, to allow time for counsel to garner additional factual and legal evidence. Doc. No. 103. Again on February 28, 2008, attorney Lopez was unable to confirm whether or not the prison had the technology necessary for attorney Richards to participate by video-conference or telephone. But regardless, since the Court ultimately approved a procedure wherein attorney Sanchez would videotape his client's deposition and then arrange for his client to respond to written interrogatories prepared by attorney Richards after she viewed the video (see Doc. No. 106), very few, if any, additional arrangements should have been necessary to effect the deposition after the hearing and order on February 28, 2008. In other words, had attorney Sanchez acted diligently in making all of the arrangements for the deposition during the preceding two months and in procuring the information the Court required regarding the prison's internet and telephone capabilities, he could have completed the deposition and responded to attorney Richards' written interrogatories within the time frame the Court set for completing discovery. His failure to do so demonstrates that, even if attorney Sanchez had properly sought the Court's leave to amend the scheduling order, he would not have been able to demonstrate good cause for granting his request.
However, regardless of the length of the discovery period and the difficulties experienced, if Mr. Sanchez determined he did not have sufficient time to depose his client, the correct response was to contact the Court, provide "good cause" supporting his request, and request the Court to extend the discovery deadline. Fed.R.Civ.P. 16(b)(4). Mr. Sanchez chose not to do so. Instead, Mr. Sanchez ignored this Court's scheduling order, declined to comply with the Federal Rules of Civil Procedure, and deposed his client well after the discovery deadline. As a result, he knowingly and intentionally violated this Court's order.
The question then, is the proper remedy for attorney Sanchez' violation of this Court's order. The Federal Rules provide that it is appropriate for the court to order an attorney to pay as a sanction opposing counsel's reasonable expenses, including attorney's fees, incurred because of the attorney's noncompliance with a court order. Fed.R.Civ.P. 16(f)(2); see also Martin Family Trust v. Heco/Nostalgia Enter. Co., 186 F.R.D. 601, 604 n. 4 (E.D. Cal. 1999) (quoting Matter of Baker, 744 F.2d 1438, 1442 (10th Cir. 1984)) (under Rule 16, "[i]f the fault lies with the attorneys, that is where the impact of sanction should be lodged"). Such an award is mandatory "unless the noncompliance was substantially justified or other circumstances make an award of expenses unjust." Id. As explained previously, the Court finds that attorney Sanchez' failure to comply was due to his own lack of diligence, so his noncompliance was not substantially justified. Moreover, as explained more fully in her declaration, attorney Richards has had to undertake significant legal work as a result of attorney Sanchez' actions that now will have to be redone to incorporate discovery and legal arguments related to Defendant Lopez' deposition (e.g. she prepared the Morales Defendants' memorandum of contentions of fact and law, reviewed Defendant Lopez' late-filed memorandum of contentions of fact and law, prepared a proposed pretrial order, met and conferred regarding the proposed pretrial order, and appeared at the pretrial conference). June 3rd Richards Decl. at 2. The Court finds that this makes an award that compensates attorney Richards for her efforts just. See Fed.R.Civ.P. 16 Advisory Committee Notes (1983 Amendment) ("the court has discretion to impose whichever sanction it feels is appropriate under the circumstances").
In her motion, attorney Richards argues that exclusion of the untimely deposition is an appropriate remedy for attorney Sanchez' violation of this Court's order. Sanctions Mot. at 4-5. However, the trial judge apparently rejected this sanction when he continued the pretrial conference and directed the parties to complete discovery. Transcript of May 14, 2008 hearing, Doc. No. 117. Because this sanction affects trial evidence, the Court defers to the trial judge. Attorney Richards' alternative request was for a monetary sanction (Sanctions Mot. at 5-6) and the Court, therefore, addresses that request only.
During the pretrial conference, Judge Brewster suggested that the parties may need to revise the pretrial filings, including the proposed pretrial order, in light of the additional discovery pertaining to Defendant Lopez and he also directed counsel to contact his chambers when they were ready for another pretrial conference. Doc. 117 at 15-25 (Transcript of May 14, 2008 pretrial conference before Judge Brewster).
Attorney Richards requests compensatory sanctions in the amount of $3,000, which represents twelve hours of work at her hourly billing rate of $250. Id. Determination of whether attorney's fees are reasonable typically involves calculating the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate. Hensley v. Eckerhart, 461 U.S. 424, 433-434 (1983). "The calculation of the amount of a `reasonable attorney's fee' is not a precise science," Green v. Baca, 225 F.R.D. 612, 614-615 (C.D. Cal. 2005), and the Supreme Court has repeatedly reemphasized that discretion to determine the amount of a fee award lies with the district court, Hensley, 461 U.S. at 437. In this case, attorney Richards explains that the twelve hours consisted of time spent preparing a memorandum of contentions of fact and law, reviewing Defendant Lopez' memorandum, reviewing and comparing a second late-filed "amended" memorandum, preparing a proposed pretrial order, reviewing Defendant Lopez' proposed pretrial order and meeting and conferring about the same, responding to Defendant Lopez' ex parte request for extension of time for the pretrial conference, and appearing at the pretrial conference. June 3rd Richards Decl. ¶ 4. Given the large volume of work this entails, the Court finds twelve hours to be a reasonable amount of time. A billing rate of $250 per hour is reasonable for an experienced attorney in the San Diego market, so the Court also finds attorney Richards' billing rate to be appropriate. Furthermore, the Court notes that attorney Sanchez has not objected to the amount of attorney Richards' fee request. Therefore, the Court finds it appropriate to sanction attorney Sanchez in the amount of $3,000, payable to attorney Richards as compensation for expenditures stemming from attorney Sanchez' failure to comply with the Court's order.
CONCLUSION
For the foregoing reasons, the Morales Defendants' motion for sanctions is GRANTED. Attorney Sanchez is hereby ordered to reimburse attorney Richards in the amount of $3,000 on or before July 17, 2008, and to file a declaration verifying said payment by July 23, 2008. Failure to comply with this Order may result in the imposition of additional sanctions.