The opinion of the court was delivered by: Dennis L. Beck United States Magistrate Judge
ORDER GRANTING PLAINTIFFS' MOTION TO COMPEL IN PART (Document 37)
Plaintiffs C&G Farms and Amaral Ranches ("Plaintiffs") filed the instant motion to compel on March 3, 2010. The matter was heard on April 16, 2010, before the Honorable Dennis L. Beck, United States Magistrate Judge.*fn1 Dennis Lewis appeared on behalf of Plaintiffs. Tara Cooper appeared on behalf of Defendant Capstone Business Credit, LLC ("Capstone").
Plaintiffs filed the instant breach of contract action on January 6, 2009, against Defendants Lindsay Foods International, Tulare Frozen Foods, LLC, and Capstone Business Credit, LLC. Plaintiffs filed a First Amended Complaint as of right on April 23, 2009, removing Lindsay Foods as a Defendant. On July 9, 2009, the Court dismissed Tulare Frozen Foods, LLC pursuant to Plaintiffs' notice of voluntary dismissal.
On March 17, 2010, after receiving leave of Court, Plaintiffs filed a Second Amended Complaint ("SAC"). The SAC adds Capstone Capital Group I, LLC, John R. Rice, Joseph F. Ingrassia, Capstone Group, Inc., and The Capstone Group, LLC as Defendants.
Plaintiffs seek to recover amounts due for produce sold to Lindsay Foods in 2006 and 2007. Plaintiff contend that the sale of the produce was subject to the Perishable Agricultural Commodities Act, 7 U.S.C. § 499e(c) ("PACA").
Plaintiffs further allege that Capstone began lending money to Lindsay Foods and took a security interest in assets of Lindsay Foods, including real property, inventory, accounts receivable, equipment and other assets. Between February 2007 and May 2008, Capstone, its managing members John R. Rice and Joseph F. Ingrasia, and Capstone Capital Group had substantial control over the assets of Lindsay Foods and controlled decisions as to which creditors would be paid and in what amount. Plaintiffs allege that they elected to pay themselves and other non-PACA creditors.
Plaintiffs contend that they are beneficiaries of a PACA-created trust over all of Lindsay Foods' perishable agricultural commodities, all inventories of food or other products derived from the sale of the produce and all proceeds derived from the sale of the products. Plaintiffs further contend that Capstone and Capstone Capital Group knew or should have known that Lindsay Foods owed money and that its assets were subject to a floating PACA trust in favor of Plaintiffs.
Based on these allegations, each Plaintiff alleges causes of action for (1) breach of contract, (2) declaratory judgment, (3) unlawful receipt and retention of PACA trust assets, (4) violation of PACA by direct contract and (5) violation of PACA by controlling and directing payments of Lindsay Foods' assets.
Plaintiffs filed the instant motion to compel against Capstone on March 3, 2010. Plaintiffs seek to compel responses to Request for Interrogatories and Request for Production of Documents. Plaintiffs also seek sanctions in the amount of $4,412.00.
The parties filed their joint statement on April 9, 2010.
Federal Rule of Civil Procedure 26(b)(1) provides that a party "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."
Plaintiffs move to compel responses to Interrogatories numbers 5, 6, 7, 8, 9, 10, 12, 13 and 14, and document production for Requests numbers 2-21. As indicated in the joint statement and confirmed at the hearing, Capstone intends to provide supplemental responses to all interrogatories. Capstone also intends to provide supplemental responses to ...