United States District Court, N.D. California, San Jose Division
ORDER GRANTING DEFENDANTS' MOTION TO COMPEL AND DENYING DEFENDANTS'
REQUEST FOR SANCTIONS (RE: DOCKET NOS. 28, 29)
PAUL S. GREWAL, Magistrate Judge.
Before the court are Defendants' motion to compel Plaintiffs to produce all documents responsive to Defendants' Request for Production of Documents and Defendants' motion for sanctions under Federal Rule of Civil Procedure 37. Plaintiffs oppose. Because the parties' papers squarely present the issues, the court finds the motion suitable for disposition without a hearing. After considering the arguments, the court GRANTS Defendants' motion to compel and DENIES Defendants' request for sanctions.
Plaintiffs allege that in December 2010, ASIC and Microsemi Corporation began to discuss the possibility of Microsemi buying ASIC. Plaintiffs also allege that ASIC's President and Chief Executive Officer promised that contributions to ASIC's Simplified Employee Pension Plan would be paid for 2010 and the first half of 2011. Defendants see things differently, claiming that the alleged promises could not have been made because ASIC did not begin discussions with Microsemi until April 2011.
In any event, on July 5, 2011, Microsemi acquired ASIC. According to Plaintiffs, at the ASIC Board of Directors' final meeting before the acquisition, the Board represented that all contributions accrued through June 30, 2011 would be paid into the participant employees' accounts and that it also allocated funds for this purpose. Defendants deny this and contend that each of the thirteen Plaintiffs who were laid off following the merger signed releases of at least some of their asserted SEP claims.
On March 4, 2013, Plaintiffs brought a myriad of claims against Defendants. After the court subsequently dismissed a majority of these claims,  Plaintiffs filed amended claims.
On February 4, 2014, Defendants served document requests on each of the Plaintiffs. The 134 requests relate to specific allegations regarding the SEP Plain in Plaintiffs' First Amended Complaint,  and in particular (1) what promises were made by ASIC's executives and (2) whether Plaintiffs signed the releases knowingly and voluntarily. Plaintiffs objected to the document requests, claiming that (1) the discovery was not authorized under the Employee Retirement Income Security Act and (2) that the requests were unduly burdensome and harassing. Despite meet and confer between the parties regarding these records, they have not been able to resolve the issue, and this motion to compel followed. Defendants also filed a motion for monetary discovery sanctions under Fed.R.Civ.P. 37, claiming that Plaintiffs' objections to the RFPs are not substantially justified by existing case law.
II. LEGAL STANDARDS
The Federal Rules of Civil Procedure provide parties "may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense." "Once the moving party establishes that the information requested is within the scope of permissible discovery, the burden shifts to the party opposing discovery." "An opposing party can meet its burden by demonstrating that the information is being sought to delay bringing the case to trial, to embarrass or harass, is irrelevant or privileged, or that the person seeking discovery fails to show need for the information."
If a motion to compel is granted or the requested discovery is provided after the motion was filed, Fed.R.Civ.P. 37(a)(5)(A) provides for "the movant's reasonable expenses incurred in making the motion, including attorney's fees." However, the court may not order sanctions if (1) the movant filed the motion before attempting in good faith to obtain the disclosure or discovery without court action, (2) the opposing party's nondisclosure, response, or objection was substantially justified or (3) other circumstances make an award of expenses unjust.
A. The Discovery Is Permissible Under ERISA
The SEP plan in question is subject to the terms of the Employee Retirement Income Security Act. Under ERISA, discovery may be limited in claims for plan benefits under Section 1132(a)(1)(B) because an administrative record exists for such claims, and allowing additional discovery beyond that record would frustrate ERISA's goal of "provid[ing] a method for workers and beneficiaries to resolve disputes over benefits inexpensively and expeditiously." However, discovery beyond the administrative record may be appropriate for claims under Section 1132(a)(3) that do not arise from the written ERISA plan terms, as there may be no administrative record for such claims.
Plaintiffs appear to acknowledge that discovery beyond the administrative record is permissible for 1132(a)(3) actions, but assert that discovery by plan administrator defendants should be limited because their cited cases only involved discovery by plaintiffs. But Plaintiffs ...