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U.S. Equal Employment Opportunity v. Giumarra Vineyards Corporation

February 6, 2012

U.S. EQUAL EMPLOYMENT OPPORTUNITY COMMISSION,
PLAINTIFF, DELFINA OCHOA, MARIBEL OCHOA, JOSE OCHOA, AND GUADALUPE MARTINEZ, PLAINTIFFS-IN-INTERVENTION,
v.
GIUMARRA VINEYARDS CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Michael J. Seng United States Magistrate Judge

ORDER DENYING PLAINTIFF-INTERVENORS' DEMAND FOR DISCOVERY OF FINANCIAL INFORMATION

I. INTRODUCTION

This action was initiated December 29, 2009, by Plaintiff, the U.S. Equal Employment Opportunity Commission ("EEOC"), alleging Defendant engaged in unlawful employment practices directed against individuals now named as Plaintiff Intervenors. The unlawful acts were claimed to consist of toleration of a hostile work environment arising out of alleged sexual harassment of one Intervenor by a co-worker and the retaliation, by summary termination of employment, against all Intervenors for complaining about the unlawful actions. The complaint sought recovery of lost wages, general compensatory damages, punitive damages and other equitable and injunctive relief. Intervenors added supplemental state law discrimination and retaliation claims.

Defendant denies the claims and specifically denies that any of the Intervenors were harassed, complained of harassment or were terminated for complaining of harassment. Defendant claims Intervenors voluntarily terminated their own employment after approximately thirteen days on the job.

EEOC and Defendant have reached an agreement to settle the former's claims. The terms are being finalized. Intervenors pursue their claim for damages.

The case originally faced a June 30, 2011, discovery deadline and an August 19, 2011, deadline for filing non-dispositive motions. Trial was set to begin on November 15, 2011. Later, the discovery deadline was extended to September 30, 2011, and trial was set for January 31, 2012. Then, following retirement of the District Judge to whom the case had been assigned, discovery was continued until December 30, 2011 and trial is now set for June 12, 2012.

The matter is before the Court at this time in response to Intervenor's request for an order directing Defendant to produce records and deposition testimony relating to Defendant's financial status. This issue was first presented to the Court in a request for a telephone conference; such a conference is a prerequisite to filing a discovery motion before the undersigned. During the November 15, 2011 conference and by follow-up minute order (ECF No. 56), the parties were directed to provide further briefing on the issue. A continued informal conference was convened December 14, 2011, at which time, after hearing further argument from the parties, the Court announced its intended decision consistent with the following.

The Court now issues its order without formal hearing, the matter being deemed submitted based on the briefing and informal conferences discussed above and in accordance with Local Rule 230(g) and Fed. R. Civ. P. 78.

II. ISSUE PRESENTED

The issue before the undersigned is whether Defendant should be compelled at this time to produce, in connection with Intervenor's punitive damage claim, evidence relating to Defendant's final status.

III. APPLICABLE LAW

Fed. R. Civ. P. 26(b)(1) gives each party in federal litigation the right to discover "any non-privileged matter that is relevant to any party's claim or defense".

A valid claim for punitive damages generally puts defendant's financial worth at issue and makes it admissible at trial for consideration in determining an amount of the punitive damages to be awarded. City of Newport v. Fact Concerts, Inc., 453 U.S. 247 267 (1981). Since net worth is relevant to the issue of punitive damages, it is discoverable in a proper case. As Intervenors note, the question here, and generally, is when such information is to be disclosed. Id.

Applicable law on this issue in this circuit is clearly unclear: The Ninth Circuit has not yet issued a decision signifying whether it will follow that line of cases holdings that a defendant's financial condition is discoverable in advance of trial whenever punitive damages are properly pled, or that line which holds that plaintiff must make a prima facie showing of entitlement to such damages. See EEOC v. California Psychiatric Transitions, 258 F.R.D. 391, 394-395 (E.D. Cal. 2009) (citing U.S. v. Matusoff Rental Co., 204 F.R.D. 396, 399 (W.D. Ohio 2001); EEOC v Klockner H & K Machines, 168 F.R.D 233, 235-236 (E.D. Wis. 1996); and EEOC v. Staffing Network, 2002 WL 311473840 at *3-4 (N.D. Ill. Nov. 4, 2002) as representative of the former and to Roberts ...


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