The opinion of the court was delivered by: Judge Caputo
Now before the Court are two motions made by Defendant NBT Bank concerning the appropriate scope of discovery in this case. First, is Defendant's "Motion to Compel Discovery, Motion for Sanctions, Motion for Attorney Fees" (Doc. 72) filed on January 13, 2009. Second, is Defendant's "Motion for Allowance to Serve Supplemental Discovery Requests Upon Plaintiff" (Doc. 77) filed on January 22, 2009. For the reasons detailed in this memorandum, both motions will be denied.
The Court has jurisdiction in this matter pursuant to 28 U.S.C. § 1332.
On or about January 11, 2006, property owned by Kevin and Jacqueline Fitzgerald ("the Fitzgeralds") sustained fire damage. (Am. Compl., Doc. 48 ¶ 12.) In accordance with the terms and conditions of a mortgage they had entered with Plaintiff Option One Mortgage Corporation ("Option One"), the Fitzgeralds had a hazard insurance policy for damage to the property. (Id. ¶ 10.) As a result of the fire damage to the property, on May 23, 2006, the Fitzgeralds' insurer, Nationwide Insurance, issued a loss draft check in the amount of one hundred thirteen thousand, six hundred thirteen dollars ($113,613.00). (Id. ¶ 13.) This check was made payable to "Kevin Fitzgerald and Jacqueline Fitzgerald and Option One Mrtg. Corp." (Id.; Check, Doc. 1, Ex. 2.) This check was endorsed by the Fitzgeralds, and on or about June 28, 2006, Defendants NBT Bank, N.A. ("NBT") and JP Morgan Chase Bank, N.A. ("JP Morgan") both honored the check, even though it had not been endorsed by Option One. (Am. Compl. ¶¶ 17-22.)
On October 16, 2007, Option One filed its Complaint (Doc. 1) with this Court alleging four (4) counts of conversion and fraud against the Fitzgeralds, NBT, and JP Morgan. On November 3, 2008, this Court granted Option One's motion to amend the original Complaint. (Doc. 47.) The Amended Complaint (Doc. 48) included an additional, fifth count against the Fitzgeralds for breach of contract. In November of 2008, Defendants NBT Bank, N.A. and JP Morgan Chase Bank, N.A. filed Answers to Option One's Amended Complaint that included numerous cross claims against all Defendants. (Docs. 54, 55.) On December 10, 2008, NBT Bank, N.A. and JP Morgan Chase Bank, N.A. mutually withdrew the cross claims brought against each other without withdrawing the cross claims brought against the Fitzgeralds. (Doc. 57.)
On January 13, 2009, NBT filed the present "Motion to Compel Discovery. Motion For Sanctions, Motion for Attorney Fees." (Doc. 72.) Therein, NBT states that, in 2007, NBT served Option One with a document request and set of interrogatories, and that Option One's responses to these discovery requests "consist largely of blanket objections" and "do not provide the requested information or documents." (Id. ¶¶ 1-3.) NBT, thus, requests that this Court order Option One to provide all of the supplemental document productions and interrogatory replies identified in the motion, and requests that the Court impose sanction against Option One for all of NBT's costs and fees associated with the preparation and filing of the present motion. (Id. ¶ 48.) On January 22, 2009, NBT filed the second present "Motion for Allowance to Serve Supplemental Discovery Requests Upon Plaintiff." (Doc. 77.) In this motion, NBT reiterates those arguments pertaining to Option One's responses to NBT's discovery requests originally made in its January 13, 2009 motion, argue that discovery has raised new issues, and that statements made by the Fitzgeralds during depositions "cast this case in a whole new light, and raise questions concerning: whether the Plaintiff knew of and consented to the use of the insurance funds by Mr. Fitzgerald; whether Plaintiff ever objected to Mr. Fitzgerald's use of the insurance check proceeds; and, whether Plaintiff was negligent in its monitoring and/or involvement with the insurance repairs." (Id. ¶¶ 6-9.) As a result, NBT requests that this Court enter an order allowing NBT to serve supplemental discovery requests upon Option One. (Id. ¶ 15.)
NBT filed its brief in support of its motion to compel discovery on January 22, 2009 (Doc. 79), Option One filed its brief in opposition on January 23, 2009 (Doc. 80), and NBT filed a reply brief on February 4, 2009 (Doc 92). Likewise, NBT filed a brief in support of its motion to serve supplemental discovery requests on February 4, 2009 (Doc. 93) and Option One filed a statement of facts (Doc. 95) and opposition brief (Doc. 96) on February 10, 2009. On February 20, 2009, the Court heard oral argument concerning both motions from counsel for NBT and Option One. (Feb. 20, 2009 Transcript, Doc. 100.) As these motions have been thoroughly briefed and argued, they are currently ripe for disposition.
Rule 26(b)(1) of the Federal Rules of Civil Procedure provides:
Parties may obtain discovery regarding any matter, not privileged, that is relevant to the claim or defense of any party, including the existence, description, nature, custody, condition, and location of any books, documents, or other tangible things and the identity and location of persons having knowledge of any discoverable matter. For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence...
It is critical to note that the discovery shall be "relevant to the claim or defense of any party" or that "for good cause" the court may order discovery of any matter relevant to the subject matter involved in the action." As to the latter, relevancy is broader than the former. In the latter, "relevant information" need not be admissible or relevant to the "claim or defense" if the discovery "appears reasonably calculated to lead to the discovery of admissible evidence." In the former, it must be relevant to the claim or defense. This structure of Rule 26(b)(1) is the result of amendment in 2000. Instead of all discoverybeing relevant to the subject matter of the action, i.e. reasonably calculated to the discovery of admissible evidence, it must now be relevant, and therefore admissible at trial or if good cause is shown, the court may order discovery if it is relevant to the "subject matter" of the action, i.e. reasonably calculated to lead to the discovery of admissible evidence.
Under Federal Rule of Civil Procedure 37, a party who has received evasive or incomplete discovery responses may seek a court order compelling additional disclosure or discovery. "The party seeking the order to compel must demonstrate the relevance of the information sought. The burden then shifts to the opposing party, who must demonstrate in specific terms why a discovery request does not fall within the broad scope of discovery or is otherwise privileged or improper." Paluch v. Dawson, No. 1:CV-06-1751, 2007 WL 4375937, at *2 (M.D. Pa. Dec. 12, 2007).
I. NBT's Motion to Compel Discovery
In its motion to compel, Defendant NBT offers several arguments why the Court should require Option One to further respond to NBT's discovery requests. First, NBT makes a generalized complaint that Option One's answers to various interrogatories have primarily consisted of blanket objections. NBT further argues that Option One's provision of documents was limited to "Plaintiff's extremely narrow interpretation of the issues relevant to this case" and has "wholly disregarded NBT's pleaded Affirmative Defenses and Counterclaims." (Def.'s Br. in Reply, Doc. 92, at 5.) In response, Option One argues that the current case "involves the cashing (conversion) of a check and that "[t]he information that the Defendant is seeking is not relevant to the instant action, but only sought in bad faith to annoy, embarrass, or cause undue burden on Plaintiff." (Pl.'s Br. in Opp., Doc. 80, Ex. 1 at 10.)
On February 20, 2009, counsel for both NBT and Option One appeared before the Court for oral argument on NBT's motion to compel. During the course of this argument, counsel for NBT represented that the interrogatories submitted to Option One that are the subject of the present motion to compel were drafted by NBT's prior counsel. (Feb. 20, 2009 Transcript, at 14:23-15:19.) The Court questioned NBT's counsel concerning these interrogatories and, after acknowledging that some of these original interrogatories were not on-point and relevant to the current case, counsel agreed that answers to these interrogatories was unnecessary in the event that Option One, provided responses to the supplemental interrogatories submitted by NBT. (Id. at 16:11-21.) At the conclusion of arguments, the Court asked, and NBT's counsel confirmed, ...