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Lora v. NHS, Inc.

United States District Court, E.D. Pennsylvania

May 22, 2014

YENNY LORA, et al., Plaintiffs,
v.
NHS, INC., et al. Defendants.

MEMORANDUM ORDER

LINDA K. CARACAPPA, Magistrate Judge.

After an extensive history of discovery disputes and plaintiffs' systemic failure to comply with this court's discovery orders, defendants have filed a motion for sanctions pursuant to Federal Rule of Civil Procedure 37(b). See Doc. 84. Plaintiffs subsequently filed a cross-motion for sanctions alleging defendants' motion for sanctions violates Federal Rule of Civil Procedure 11(b) and Local Rule 26.1. See Doc. 90. For the reasons that follow, defendants' motion for sanctions is GRANTED and plaintiffs' cross-motion for sanctions is DENIED.

I. PROCEDURAL HISTORY RELATED TO DISCOVERY DISPUTES

On December 3, 2013, the Honorable Petrese B. Tucker referred this matter to the undersigned for resolution of all outstanding discovery matters. At the time of referral, plaintiffs had made no reasonable response to either the first or second sets of propounded interrogatories, and refused requests for deposition scheduling. Motions to compel filed by both sides were pending.

The undersigned issued discovery orders dated December 20, 2013 and March 12, 2014 regarding various motions to compel. It was necessary for the court to order that plaintiffs execute medical and mental health record authorizations, and then stand for deposition. Additionally, in the December 20, 2013 order, plaintiffs were precluded from submitting expert reports on damages for failure to comply with discovery deadlines previously set by the District Court. This court's March 12, 2014 order also required production by plaintiffs of certain income documentation. See Doc. 60, 70.

On March 27, 2014, the undersigned held an extensive discovery conference to address outstanding discovery issues. On March 31, 2014, this court issued a detailed order in response to plaintiffs' failure to respond to defendants' discovery requests and this court's previous orders. See Doc. 75, which is attached hereto and re-incorporated for easy reference as "Attachment 1." In its March 31, 2014 order, this court found that Plaintiff Lora completely failed to comply with the court's order for production of income verification, and ordered Lora be precluded from introducing evidence of wage loss or any other financial loss should the matter proceed to trial. Id.

In its March 31, 2014 order, this court also found that Plaintiff Palma's failure and her counsel's failure to provide any documents or information pertaining to prior lawsuits and prior claims of emotional distress damages to be a deliberate and willful failure to comply with legitimately sought discovery. Plaintiff was given another chance, and ordered to provide specific documents in this regard within three (3) additional days. Now, more than six (6) weeks later, neither Plaintiff Palma, nor her counsel, have complied in any respect.

Relevant to the pending motion for sanctions, the undersigned learned through the discovery conference that plaintiffs' counsel interviewed Defendant Tamitra Foreman, but refused to provide any documentation. The date of the interview was of particular concern as plaintiff's counsel interviewed Ms. Foreman on January 24, 2012, eighteen (18) days after initiating a lawsuit, naming Tamitra Foreman as a defendant, in state court. See Palma, et al. v. NHS, et al., CCP Philadelphia, January Term, No. 120103288 (Jan. 6, 2012).[1] Subsequently, on March 31, 2014, the court ordered as follows:

Within three (3) day of the date of this order, Attorney Jauregui, who is an officer of this court and now a potential witness in this case by virtue of this interview, is hereby ORDERED to produce and serve upon opposing counseling a duly sworn affidavit setting forth a detailed proffer of the complete contents of the interview. Failure to comply with this order may result in discovery sanctions.

See Doc. 75.

Plaintiff subsequently filed three motions for protective orders, which the Honorable Petrese B. Tucker denied. See Doc. 81, 87, 88. As it relates to this pending motion for sanctions, plaintiffs' counsel asserted through his motion for a protective order that his interview of Tamitra Foreman was protected by attorney work product privilege. See Doc. 76. On April 9, 2014, the Honorable Petrese B. Tucker denied this motion. See Doc. 81. Plaintiffs' counsel subsequently served a declaration, not a sworn affidavit as directed by this court's previous order, merely describing the circumstances of the interview, such as the weather, his actions walking up to the house on the day in question, and the location of their conversation, and did not provide a proffer of the complete contents of the interview as ordered by this court. See Doc. 84, Def. Motion for Sanctions, Ex. 1. Defendants represent that they attempted to subsequently resolve the issue without the court's intervention; however, despite Chief Judge Tucker rejecting plaintiffs' counsel's claim of attorney work product privilege, plaintiffs' counsel continued to assert this privilege as the reason for not providing the proffer. See Def. Motion for Sanctions, Ex. 2, 3.

Each plaintiff has asserted additional federal claims that she was not compensated properly under the Fair Labor Standards Act, yet despite being ordered to do so by the court in its extensive discovery order of March 31, 2014 (Doc. 75), neither plaintiff has produced any documentation or itemized calculation of damages whatsoever in support of their claims. The plaintiffs have taken zero (0) depositions in this, or any other regard. These FLSA claims now must be dismissed for failure to prosecute, and failure to provide court ordered discovery.

The March 31, 2014 discovery order (Doc. 75) of this court additionally ordered Plaintiff Palma to produce copies of her federal, state, and local tax returns for years 2011, 2012, 2013, whether filed personally or for any business entity in which Palma had an interest.[2] In response to this specific order and, from the court's perspective, completely standard discovery request, Palma produced only redacted transcripts of her federal tax filings for years 2010, 2011, and 2012. A tax return transcript, redacted or otherwise, is not, and does not equate to, a complete federal tax return with accompanying schedules. It is relevant and appropriate here to have production of the schedules and supporting documents. For instance, the 2011 tax return transcript shows:

1) Itemized deductions $25, 719. 2) Real estate/personal taxes paid $0. 3) Form 3800 general business credit/ new energy efficient home credit $3, 000, 000.

The 2012 transcript shows:

1) Itemized deductions $31, 965. 2) Real estate/personal taxes paid $22, 123. 3) Form 3800 - general business credit/ new energy efficient home credit $1, 928, 000.

These and other entries certainly are appropriate for further inquiry regarding financial or emotional damages.

Again, a tax return transcript is a summary document only, and Plaintiff Palma has not produced state or local returns as ordered. Moreover, plaintiffs' Second Motion for a Protective Order (Doc. 77) sought in part protection from producing an unredacted tax return and Chief Judge Tucker denied this motion by order dated April 22, 2014 (Doc. 87). Plaintiff Palma has failed completely to comply with the court's production order, and when we note the many efforts Palma and her counsel seemingly took to avoid this production, or to delay until after her deposition, we find this failure to comply to be willful and most deliberate.

Additionally, the March 31, 2014 discovery order (Doc. 75), directed Plaintiff Lora to produce verification of her Master's Degree, including transcript, within three (3) days. Counsel for plaintiff advised the court additional time was needed, as the degree was obtained from an educational institution in the Dominican Republic. Plaintiffs' Second Motion for a Protective Order (Doc. 77) also sought relief from providing the school records and Chief Judge Tucker denied this motion by order dated April 22, 2014 (Doc. 87). As such, the production order remained in effect. Now, more than ten (10) weeks later, this production order has still not been met, and the court has not been advised of any circumstances that would prevent one from obtaining an educational transcript in ten (10) weeks time.

Defendants have brought the instant motion for sanctions as a result of plaintiffs' failure and plaintiffs' counsel's failure to comply with discovery orders, including the affidavit of the interview of Defendant Tamitra Foreman. See Def. Motion for Sanctions. Plaintiffs subsequently filed a cross-motion for sanctions in which plaintiffs assert that defendants' motion ...


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