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Wake Forest Acquisitions, L.P v. Vanderbilt Commercial Lending, Inc.

United States District Court, E.D. California

April 2, 2018

WAKE FOREST ACQUISITIONS, L.P.; SHAFFER ASSET MANAGEMENTCORPORATION; ROBERT P.SHAFFER, individually and as Co-Trustee of the Robert P. Shaffer Revocable Trust; and MARY SHAFFER, as Co-Trustee of the Robert P. Shaffer Revocable Trust, Plaintiffs,
v.
VANDERBILT COMMERCIAL LENDING, INC.; and GREGORY COOK, Defendants. VANDERBILT COMMERCIAL LENDING, INC., Counterclaim-Plaintiff,
v.
WAKE FOREST ACQUISITIONS, L.P., Counterclaim- Defendant.

          ORDER

         Plaintiffs move to reopen discovery solely to renew and resolve a previously filed motion for sanctions against defendant Gregory Cook for failure to appear at his properly noticed deposition. Mot. at 2, ECF No. 59-1; see ECF No. 52 (motion for sanctions).

         No other party has filed an opposition or response to plaintiffs' motion to reopen discovery for this purpose, and the deadline to file an opposition has passed. See ECF No. 59; L.R. 230(c). The court submitted the matter without oral argument. ECF No. 63.

         For the reasons provided below, the court GRANTS plaintiffs' motion to reopen discovery for the limited purpose of renewing their motion for sanctions, ECF No. 52.

         I. BACKGROUND

         A. Dispute

         Plaintiffs have sued defendants Gregory Cook and Vanderbilt Commercial Lending (VCL) for VCL's alleged failure to extend a $14, 060, 000 loan for development of a 272-bed student housing community. See First Am. Compl. (FAC) ¶¶ 23, 61, 117-18, 158, ECF No. 69. According to plaintiffs, VCL, by and through Cook, fraudulently represented itself as a lender and committed to extending the loan to plaintiff Wake Forest Acquisitions, LP. Id. ¶¶ 45, 59, 71, 78-80, 110, 170, 172. Plaintiffs have alleged injury stemming from VCL's failure to honor its obligation to fund the loan. Id. ¶¶ 175-90. Plaintiffs' claims include breach of contract, breach of the implied covenant of good faith and fair dealing, promissory estoppel, breach of fiduciary duty, rescission, violation of California's Unfair Competition Law, third party beneficiary breach of contract, and fraud-intentional misrepresentation. Id. ¶¶ 191-361.

         B. Plaintiffs' Attempts to Depose Cook

         Plaintiffs have sought multiple times to depose Gregory Cook, VCL's President, as both a percipient witness and a witness designated by VCL as its “person most knowledgeable, ” or “PMK, ” subject to Federal Rule of Civil Procedure 30(b)(6). See generally Bellafronto Decl., ECF No. 52-2. Cook was one of only two witnesses plaintiffs sought to depose. Id. ¶ 2. Plaintiffs' counsel attempted to meet and confer with defendants' counsel about deposing Cook, but defendants' counsel informed plaintiffs through email that Cook was “experiencing severe medical issues” and was “not fit for a deposition at this time” without knowing for “sure when he [would] be” fit. ECF No. 52-3 at 2, Ex. A. A few weeks later, plaintiffs' counsel contacted defendants' counsel again to request “documentary evidence” of Cook's “medical circumstances and condition.” Bellafronto Decl. ¶ 5; see ECF No. 52-3, Ex. B. Nearly a month after their initial email exchange, defendants' counsel communicated that Cook “is collecting medical information, but even that is hard for him.” ECF No. 52-3 at 6, Ex. C. Defendants' counsel acknowledged that “we must move forward, since I will not be able to provide you with comprehensive medical records in short order.” Id. Counsel confirmed Cook was “the PMK [person most qualified] of VCL, ” and that she had asked Cook to appear for his deposition scheduled March 6, 2017. Id.; see Bellafronto Decl. ¶ 6.

         Over the course of approximately four months, the parties stipulated several times to continue fact and expert discovery deadlines based on Cook's stated health problems. Bellafronto Decl. ¶¶ 8, 10-11, Exs. D-F; see also ECF Nos. 36, 43-47. The parties continued to meet and confer to schedule Cook's deposition, and plaintiffs asked Cook's counsel to present some form of medical evidence about Cook's inability to appear for deposition. Bellafronto Decl. ¶¶ 5-6, 9, 12-14; ECF No. 52-3, Exs. G, H, I. According to plaintiffs, “No such documentation was ever presented.” Mot. at 4; Bellafronto Decl. ¶ 26.

         As requested by the parties, the court amended the scheduling order for the case, extending the fact discovery cut-off date to July 21, 2017. ECF No. 47. The parties agreed on Cook's deposition as set for July 6, 2017, to take place in Corning, California where Cook resided. ECF No. 52-3 at 29, 31, Exs. K-L; Bellafronto Decl. ¶¶ 9, 16-17. Defendants' counsel communicated with plaintiffs' counsel at least twice through email, confirming Cook was confirmed for the July 6 date. ECF No. 52-3 at 29, 31, Exs. K-L.

         Plaintiffs' counsel then drove the three hours to Corning, California for Cook's deposition, scheduled to begin on July 6 at 10:00 a.m. Bellafronto Decl. ¶ 18. “After waiting for approximately 30 minutes, ” Cook's counsel informed plaintiffs' counsel that Cook “had an ‘unexplained emergency' and could not appear for his deposition for another hour but that he would appear.” Id. At 11:25 a.m., Cook still had not arrived. ECF No. 52-3 at 37, Ex. M. Defendants' counsel stated he thought Cook had identified “between 12:15 and 12:30, ” as his arrival time. Id. Cook had not arrived by 12:30 p.m., and plaintiffs' counsel then left at 12:31 p.m. Id. at 38; Bellafronto Decl. ¶ 18. Later that day, Cook, who was no longer represented by an attorney, ECF No. 49, contacted plaintiffs' counsel through email, stating he had “received a most urgent and very high priority call” that he was not expecting and “was kept on this call for several hours.” ECF No. 52-3 at 43, Ex. N. Cook suggested still “try[ing] to do one of [the depositions] today” or arranging for “a continuance.” Id. at 44.

         Plaintiffs' counsel then sent multiple emails and called Cook on his cell phone number attempting to arrange a new date and time for Cook's deposition to occur before the fact discovery cut-off date. Bellafronto Decl. ¶¶ 20-22; ECF No. 52-3 at 43, 46, Exs. N-O. After three emails, a phone call and a voicemail message, Cook responded by email stating he was “not trying to ignore” plaintiffs' counsel. ECF No. 52-3 at 47, Ex. O. Despite plaintiffs' counsel requesting from Cook a date and time for his deposition, Cook did not offer any date or time. Id. Instead, Cook asked where the parties would meet. Id. Cook described “still experiencing the light headedness, shortness of breath, [being] unbalanced at times.” Id. Cook wrote that he “could momentarily pass out for a few minutes” while drafting an email “without even realizing it, ” then “abruptly come to” and his “mouse [would] go flying across the room.” Id. Cook stated “[t]his is all very difficult for me to stay focused long enough to finish this, ” then wrote he would give plaintiffs' counsel “a call this afternoon.” Id. In response, plaintiffs' counsel offered to take the deposition at Cook's house if that was “easiest for [Cook], or in Sacramento.” Id. Plaintiffs' counsel asked Cook to provide her “with a date and location to avoid a motion [to compel].” Id.

         Four days after the close of fact discovery, Cook e-mailed plaintiffs' counsel to discuss deposition scheduling, without mentioning his health condition. Bellafronto Decl. ¶ 25. Plaintiffs' counsel then called Cook but got no answer and received no reply by phone or email. Id. Cook never provided plaintiffs' counsel with dates for taking the deposition originally scheduled for July 6, nor did he provide “any doctor's notes, medical records or other evidence of the illness which ha[d] purportedly prevented him from testifying since January [2017].” Id. ¶ 26.

         C. Motion ...


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