UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF CALIFORNIA
January 10, 2008
JOEL M. CRAM, MINH D. NGUYEN, AND ROES 1 THROUGH 10, INDIVIDUALLY, AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED, PLAINTIFFS,
ELECTRONIC DATA SYSTEMS CORPORATION, A DELAWARE CORPORATION, AND DOES 1 THROUGH 100, INCLUSIVE, DEFENDANTS.
The opinion of the court was delivered by: Honorable Larry Alan Burns United States District Judge
ORDER OVERRULING OBJECTIONS TO MAGISTRATE JUDGE'S DENIAL OF MOTION TO COMPEL DISCOVERY [Dkt No. 65]
By Order entered December 19, 2007, this court denied plaintiffs' Motion For Remand in this putative class action alleging violations of California law associated with defendant Electronic Data Systems Corporation's ("EDS") practices regarding the payment of overtime compensation to its employees, among other things. Dkt No. 55. The issue presented in the Motion To Remand was whether EDS, as the removing party, could demonstrate it is more likely than not the amount in controversy exceeds the $5 million jurisdictional threshold required before this court can exercise original federal jurisdiction pursuant to the Class Action Fairness Act of 2005, 28 U.S.C. § 1332(d) ("CAFA"). Magistrate Judge Nita L. Stormes had authorized limited, expedited discovery solely on the amount in controversy issue associated with the Motion To Remand, limited to the propounding of ten (10) interrogatories per side. Dkt No. 18. EDS provided plaintiffs with responses and supplemental responses to their interrogatories. Plaintiffs remained dissatisfied with EDS' responses to plaintiffs' Interrogatory Nos. 9 and 10.
Please describe in the greatest detail possible the basis, if any, for EDS' contention that the amount in controversy in the above-captioned civil action exceeds Five Million Dollars ($5,000,000.00). At a minimum, please show EDS' calculations, and explain the underlying factual basis for the numbers utilized by EDS in performing such calculations.
Interrogatory No. 9 (emphasis added).
Please identify by name, business address, and job title, each person who may have knowledge of the factual basis, if any, for EDS' contention that the amount in controversy in the above-captioned civil action exceeds Five Million Dollars ($5,000,000.00).
Interrogatory No. 10.
Plaintiffs moved to compel further responses to those two interrogatories. Dkt No. 34. In an Order entered December 12, 2007, Judge Stormes denied their motion on grounds the additional responses sought information beyond the scope of the authorized expedited discovery and were unnecessary to inform the question whether the jurisdictional threshold amount in controversy appeared to be satisfied. Dkt No. 52. She determined EDS' factual showing, based on computations of back overtime damages and waiting penalties alone, demonstrated the Complaint placed in controversy an amount in excess of the CAFA jurisdictional threshold, so that compelling EDS to provide further calculations of additional damages associated with plaintiffs' equitable relief theories was unnecessary.
In consideration of plaintiffs' moving papers in support of remand, EDS' Opposition to the remand motion, the parties' filings associated with the Motion To Compel, and the grounds for Judge Stormes' denial of that motion, this court concluded EDS carried its burden to demonstrate CAFA removal jurisdiction, irrespective of any argument plaintiffs could attempt to make to the contrary in a Reply brief. Without recourse to any other damages valuation under any other theory of recovery, upon de novo review of the amount in controversy issue as illuminated by the authorized interrogatory responses, this court concurred with Judge Stormes' finding the amount placed in controversy by the Complaint more probably than not exceeds $5 million and denied the Motion To Remand. Dkt No. 55. Plaintiffs filed, then withdrew applications for reconsideration of the Order denying remand. Dkt Nos. 59-62, 66.
On December 21, 2007, plaintiffs filed Objections to Judge Stormes' Order denying their Motion To Compel supplemental responses to Interrogatory Nos. 9 and 10. Federal Rules of Civil Procedure ("Rule") 72 provides, in pertinent part, that when a magistrate judge has decided a nondispositive matter:*fn1
Within 10 days after being served with a copy of the magistrate judge's order, a party may serve and file objections to the order. . . . The district judge to whom the case is assigned shall consider such objections and shall modify or set aside any portion of the magistrate judge's order found to be clearly erroneous or contrary to law.
The undersigned district judge's Standing Order in Civil Cases provides: "A party objecting to a Magistrate Judge's [non-dispositive] order shall file objections as provided in Federal Rule of Civil Procedure 72. Upon receipt of objections the Court will issue a briefing schedule and set a hearing date, if appropriate." Standing Order ¶ 9(a). For the reasons discussed below, the court finds neither additional briefing nor a hearing is required to address and overrule plaintiffs' Objections for failure to demonstrate any portion of Judge Stormes' Order is clearly erroneous or contrary to law.
Plaintiffs object: (1) the discovery Order "erroneously concluded that EDS' own interrogatory responses rendered complete discovery responses 'unnecessary'; and, to the extent the discovery Order might be interpreted to contain a finding regarding amount in controversy, same was erroneous and in excess of the magistrate judge's jurisdiction" (Obj. 6:16-19 (upper case modified)); and (2) "the Discovery order itself indicates that it may constitute a predicate to an award of monetary sanctions" (Obj. 5:13-15, citing Discovery Order, 6:14-7:8, discussing Rule 37(a)(4)(B) awards of fees and costs incurred to successfully oppose motions to compel discovery). The second Objection is simply inchoate and moot.*fn2
The first objection is without merit. Once EDS demonstrated the amount in controversy more likely than not exceeds the CAFA jurisdictional threshold predicated on certain of the theories of recovery advanced in the Complaint, any additional valuations predicated on other Complaint theories would serve only to increase the amount in controversy to sums in even greater excess of the jurisdictional limit. The objective underlying preliminary jurisdictional discovery is not to establish what plaintiffs' recovery might actually be, but rather to ascertain whether the minimum amount placed in controversy by the Complaint allegations likely satisfies the jurisdictional threshold. The removing party is not required at this phase to make a dispositive showing definitively establishing the actual damages plaintiffs are likely to recover if they prevail. The purpose of the expedited discovery responses was solely to resolve the parties' dispute over the likely minimum valuation of the Complaint claims for purposes of the remand motion, a purpose satisfied without the need for recourse to additional calculations under other of the Complaint theories. Plaintiffs may seek the additional information they desire in the normal course of the discovery process.
In addition, this court conducted a de novo review of the evidence in denying remand to independently conclude that it is more likely than not the Complaint places in controversy an amount in excess of $5 million based on the overtime and penalty wages calculations alone. That process disposes of plaintiffs' jurisdictional challenge to the same finding by Judge Stormes in denying their Motion To Compel a second supplemental response to Interrogatory No. 9. This court did not simply adopt Judge Stormes' finding on the issue of amount in controversy as demonstrated in the EDS responses to Interrogatory No. 9 nor give it "preclusive effect." See Singer v. State Farm Mutual Ins. Co., 116 F.3d 373, 376 (9th Cir. 1997); Sanchez v. Monumental Life Ins. Co., 102 F.3d 398, 404 (9th Cir. 1996).
Plaintiffs also object they are entitled to an expanded damages valuation response, in reliance on evidentiary objections and "best evidence" theories. The Verification by EDS representative Suzy K. Arnold alludes to business records and employees of EDS as the source of the materials used to calculate the likely number of employees, their salaries, their overtime, and the like relevant to the Complaint's putative class allegations as those inform the amount in controversy issue. Plaintiffs' argument that EDS' interrogatory responses are "inadmissible" evidence for failure to provide supporting documentation is without merit. Interrogatories are not a proper discovery device to obtain production of documents. Judge Stormes limited the expedited jurisdictional discovery to ten (10) interrogatories per side. Plaintiffs cannot unilaterally expand that discovery burden to encompass document production on "best evidence" or any other theory. A propounding party may request copies of supporting documentation identified in the response be attached to interrogatory answers, but the responding party cannot be compelled by such a request to produce those documents, and the viability of the interrogatory response is not compromised for failure to attach copies of identified documents. Normally, a party may serve a Rule 34 request for document production concurrently with the interrogatories. However, the narrow and exceptional discovery at issue here was circumscribed by the court to a limited number of interrogatories only. Nothing prevents plaintiffs in the normal course of discovery from seeking document production.*fn3
Plaintiffs also challenge the Interrogatory No. 9 responses as incompetent evidence because Ms. Arnold describes the calculations provided as compiled based on "the materials and records of [EDS] and the employees, agents and representatives of EDS," and the "responses . . . [as] true to the best of her knowledge, information and belief." Dkt No. 65, 9:26-10:8. Plaintiffs' reliance for its evidentiary Objections on representations in EDS' Opposition To Motion To Compel that "the tabulation of data [was] from multiple sources that were not within the knowledge of any single individual" and "[n]o one witness had knowledge as to the entire class or global amount in controversy," actually reinforces the adequacy of EDS' responses at this preliminary stage of the litigation for purposes of ascertaining whether it carried its burden to demonstrate the probability the amount in controversy is satisfied. See Dkt No. 45, 8:13-18. In addition, plaintiffs' criticism of the Discovery Order for failure to "expressly state that EDS' interrogatory responses were evidentiary in nature, or that EDS had provided any matter by evidence" on grounds "[c]alculations are not evidence" is without merit. Dkt No. 65 8:7-9. The call of Interrogatory No. 9, by its own terms, requested as a minimum satisfactory response only "calculations" and an "explanation" of the underlying factual basis, the very responses EDS provided. For all the foregoing reasons, Plaintiffs' objections to Judge Stormes' Order denying their motion to compel a supplemental response to Interrogatory No. 9 are OVERRULED as neither clearly erroneous nor contrary to law, without the need for further briefing or hearing.
Plaintiffs fail to elaborate on what basis this court should find Judge Stormes clearly erred or made a ruling contrary to law at this stage in the litigation in denying their motion to compel discovery of additional detail associated with EDS contact persons whose identities and descriptions were solicited in Interrogatory No. 10. No witness interviews, depositions, or other discovery is permitted as of course at the pre-Early Neutral Evaluation Conference stage of the litigation. EDS was only required to produce underlying facts showing it is more likely than not the amount in controversy threshold is met. Dkt No. 52, 5:26-28. EDS responded twice to that interrogatory, providing names, while preserving its objection the call of the question exceeded the authorized scope of the limited expedited discovery on the narrow issue of amount in controversy. Both Judge Stormes and this court, respectively, have independently determined EDS carried its burden adequately to avoid being compelled to augment its interrogatory responses and to avoid remand at this time. This court OVERRULES the objections to the Discovery Order result with respect to Interrogatory No. 10, without the need for further briefing or hearing.
Finally, the court finds plaintiffs' request that this court "set aside the Discovery Order, at least to the extent it might be construed to preclude Plaintiffs from litigating whether the amount-in-controversy requirement for CAFA jurisdiction has been satisfied" (Dkt No. 65, 12:2-4) seeks speculative relief neither necessary nor appropriate.
For all the foregoing reasons, IT IS HEREBY ORDERED plaintiffs' Objections to the denial of their motion to compel additional interrogatory responses are OVERRULED in that they identify no portion of the Discovery Order that is clearly erroneous or contrary to law in the procedural posture of this case.
IT IS SO ORDERED.