United States District Court, W.D. Pennsylvania
NORA BARRY FISCHER, District Judge.
I. BACKGROUND AND PROCEDURAL HISTORY
Presently pending before the undersigned is Plaintiffs' Motion for Sanctions, filed on April 6, 2015. (Docket No. 37). By way of background, this case was initially filed by Chie and Theodore Blakeney ("Plaintiffs") against only Faros Pittsburgh, LLC ("Faros"), on April 4, 2015, alleging claims of personal injury and loss of consortium for an incident that occurred in a property owned by Faros. (Docket No. 1). On July 24, 2014, Plaintiffs and Faros submitted a Stipulation Selecting ADR, agreeing to proceed to Early Neutral Evaluation ("ENE"). The next day, they were referred to ENE before Retired Judge Gary P. Caruso ("Judge Caruso"), pursuant to the Western District's Mandatory ADR Program. (Docket Nos. 10, 11). On November 17, 2014, Plaintiffs moved to amend their Complaint to add AGPM Pennsylvania, LLC ("AGPM PA") and AGPM, LLC ("AGPM") (collectively "the AGPM Defendants"), as those entities previously owned the property at issue. (Docket No. 13). The next day, the Hon. Cathy Bissoon granted the Motion to Amend, (Text Order of Nov. 18, 2014), and Plaintiffs filed their Amended Complaint on November 20, 2015, (Docket No. 14).
On December 29, 2014, Plaintiffs and Faros jointly moved to amend the Case Management Order, requesting an extension of time to complete ADR, owing to the addition of the AGPM Defendants and the inability to take Plaintiffs' depositions before the previously scheduled deadline. (Docket No. 22). Judge Bissoon granted that motion by text order, extending the deadline to complete ADR to March 20, 2015. (Text Order of Dec. 30, 2014). This Order made no mention of requiring the AGPM Defendants to participate in the ENE. Then, on January 9, 2015, the AGPM Defendants filed a Motion to Dismiss Plaintiffs' Amended Complaint for lack of personal jurisdiction, pursuant to Federal Rule of Civil Procedure 12(b)(2). (Docket No. 23).
As the ENE was set to occur prior to Judge Bissoon's disposition of the AGPM Defendants' Motion to Dismiss,  on March 4, 2015, the AGPM Defendants' Counsel, Donald H. Smith, Esq. ("Mr. Smith"), circulated a proposed agreement (the "Waiver Letter"), stipulating that his attendance at the ENE would not serve to waive his clients' rights and defenses, specifically referencing the pending Motion. (Docket Nos. 40-1, 40-2). On March 5, 2015, Counsel for Plaintiffs and Faros both signed the Waiver Letter. (Id. ). Prior to the ENE session, Mr. Smith also sent an email to Plaintiffs' Counsel, Counsel for Faros, and Judge Caruso, advising that, due to the pending Motion to Dismiss, he intended not to file a Statement in Anticipation of Early Neutral Evaluation, as would normally be required. (Docket No. 40-4); see also Vay v. Huston, No. 14-769, 2015 WL 791430, at *5 (W.D. Pa. Feb. 25, 2015) (sanctioning a party for, inter alia, failing to provide an ENE Position Statement). No responses or objections were made to this email.
That afternoon, Plaintiffs moved to be excused from personal attendance at the ENE session. (Docket No. 33). In support of same, Plaintiffs averred that, subsequent to the filing of this lawsuit, they moved from Pittsburgh, PA to Honolulu, Hawaii, in order to be closer to Mrs. Blakeney's family, in Japan. (Id. at ¶ 2). They argued that, since the Plaintiffs had come to Pittsburgh the prior month for depositions, it would be unduly burdensome, in expenditure of both time and money, to travel back to Pittsburgh for the ENE. (Id. at ¶ 4). Plaintiffs filed this Motion prior to knowing whether Defendants consented to it and, seemingly, without consultation with the Neutral, Judge Caruso. (Id. at ¶ 8). The day after it was filed, Judge Bissoon denied that Motion. (Text Entry of March 6, 2015).
The ENE session in this matter took place on March 20, 2015. (Docket No. 36). The following people were in attendance in person: Chie and Theodore Blakeney; Jason Shipp, Esq., the Blakeneys' attorney; a claims representative of Faros; Cathy Gordon, Esq., Faros' attorney; and Donald Smith, Esq., AGPM PA's attorney. All agreed that the Neutral provided his assessment of the case. Of note, AGPM PA paid its share of the ENE cost, although it did not actively participate in the session.
On April 6, 2015, Plaintiffs filed the pending Motion for Sanctions, alleging that AGPM PA violated Section 2.7(A)(3) of the Local ADR Policies and Procedures (hereinafter "ADR P&P") by not having a corporate representative with full settlement authority present at the ENE. (Docket No. 37). Pursuant to ADR P&P § 2.4, Judge Bissoon elected to have the Motion for Sanctions be randomly reassigned to another judge on the Court's Case Management and ADR Committee. Accordingly, on April 8, 2015, the Motion was reassigned to the undersigned. (Text Entry of April 6, 2015). Faros has taken no position as to this Motion, and certainly has not made any allegations of bad faith.
On April 27, the Court held a Hearing and Oral Argument on Plaintiffs' Motion, and ordered that any ruling on same would be held in abeyance, pending Judge Bissoon's resolution of the Motion to Dismiss. (Docket Nos. 45, 46). Subsequently, Judge Bisson partially granted Defendants' Motion to Dismiss, dismissing, with prejudice, the Plaintiffs' Amended Complaint as to AGPM, but denying the Motion, without prejudice, as to AGPM PA. (Docket No. 47). Then, on June 9, 2015, the Court reconvened the Hearing on the Motion for Sanctions. (Docket No. 50). Following same, the parties met with the Court's ADR Coordinator, Karen Engro, Esq., in an attempt to reach a resolution as to the Motion without further Court action. (Id. ). The next day, the Court was informed via email correspondence that no resolution was reached. Accordingly, the Motion is ripe for disposition.
II. LEGAL STANDARD
The law controlling the resolution of this motion is the ADR P&P and case law interpreting same. "Each party must attend the selected ADR session unless excused under paragraph D below." ADR P&P § 2.7(A). "A party other than a natural person (e.g., a corporation or an association) satisfies this attendance requirement if represented by a decision maker(s) (other than outside counsel) what has full settlement authority and who is knowledgeable about the facts of the case." Id. at § 2.7(A)(1). "No later than 10 calendar days before the ENE, each party must submit directly to the evaluator, and must serve on all other parties, a written statement." Id. at § 4.5(a).
"This Court must determine if sanctions should be imposed upon [AGPM PA] for failing to participate in the [ENE] in good faith." Vay v. Huston, 2015 WL 791430, at *2. "[T]he burden of proof in persuasion rests on the party moving for sanctions." TEGG Corp. v. Beckstrom Elec. Co., Civ. No. 08-435, 2008 WL 5216169, at *3 (W.D. Pa. Dec. 10, 2008).
The basic assertion in Plaintiffs' Motion is that, because AGPM PA was not represented by anyone other than outside counsel at the ENE session, it violated ADR P&P § 2.7(A)(1). (Docket No. 37 at ¶ 5). According to Plaintiffs, this "failure to be represented by a decision maker resulted in an ENE that was ...