United States District Court, S.D. California
REPORT AND RECOMMENDATION FOR ORDER GRANTING IN PART
AND DENYING IN PART MOTION FOR DISCOVERY SANCTIONS [ECF No.
261] REDACTED
HONORABLE LINDA LOPEZ, UNITED STATES MAGISTRATE JUDGE
Currently
before the Court is Plaintiff Stone Brewing's Motion for
Further Discovery Sanctions [see ECF Nos. 261, 280
(“Mot.”)], Defendant's opposition to the
motion [see ECF Nos. 265, 279
(“Oppo.”)], and Plaintiff's October 21, 2019
reply [see ECF Nos. 274, 282 (“Reply”)].
This Report and Recommendation is submitted to the Honorable
Roger T. Benitez, United States District Judge, pursuant to
the provisions of 28 U.S.C. § 636 because the order
makes recommendations regarding evidentiary sanctions
including but not limited to adverse inference instructions.
For the reasons set forth below, the Court
RECOMMENDS that United States District Judge
Benitez issue an order: (1) approving and adopting this
Report and Recommendation; (2) DENYING
Plaintiff's request to strike MillerCoors's defenses
and counterclaims to the extent they allege prior use of
“STONE” or “STONES” and the alleged
lack of competition between economy and craft beer; (3)
DENYING Plaintiff's request to instruct
the jury that MillerCoors withheld material evidence and that
an adverse inference may be drawn from that fact; (4)
DENYING Plaintiff's request to require
MillerCoors to detail how, where, and when it searched for
responsive documents and provide an appropriate certification
regarding its efforts; (5) GRANTING
Plaintiff's request to supplement its expert reports to
take account of the newly produced materials; (6)
DENYING Plaintiff's request for
additional discovery on XXXXX; and
(7) GRANTING IN PART and DENYING IN
PART Plaintiff's request for monetary sanctions.
RELEVANT
DISCOVERY BACKGROUND
On
September 5, 2019, Plaintiff filed a Motion to Compel and for
Sanctions for Discovery Violations. ECF No. 218. In the
motion, Plaintiff argued that Defendant failed to make a
“full production of historical Keystone
Materials” [in response to RFP Nos. 41 and 42].
Id. Plaintiff requested an “on-site inspection
of the historical items in their locations in the Coors
archive” and an additional deposition of Ms. Heidi
Harris. Id. at 14-15. Plaintiff also requested
sanctions. See id. at 15-18. MillerCoors opposed the
motion, and Stone filed a reply. ECF Nos. 221, 224. On
September 17, 2019, the Court issued an order granting in
part and denying in part Plaintiff's motion for the
requested discovery and for sanctions. ECF No. 250.
Specifically, the Court ordered MillerCoors to make a full
production of the historical Keystone materials in response
to RFP Nos. 41 and 42 on or before September 20, 2019, and
also ordered Ms. Heidi Harris to appear for a follow-up video
deposition on or before September 27, 2019. Id. at
13. The Court denied Stone's request for an inspection of
the Coors archive and for evidentiary and/or monetary
sanctions. Id.
On
October 8, 2019, counsel for the parties contacted the Court
regarding Plaintiff's instant request for sanctions on
the basis that Defendant has systemically failed to comply
with its discovery obligations in this case. The Court issued
a briefing schedule. ECF No. 258. The parties filed their
pleadings in accordance with the briefing schedule.
See Mot, Oppo., and Reply.
LEGAL
STANDARD
Federal
Rule of Civil Procedure 37 empowers the Court to issue
sanctions where a party fails to obey a previous order to
provide discovery. The Rule provides for various sanctions,
including:
(i) directing that the matters embraced in the order or other
designated facts be taken as established for purposes of the
action, as the prevailing party claims;
(ii) prohibiting the disobedient party from supporting or
opposing designated claims or defenses, or from introducing
designated matters in evidence;
(iii) striking pleadings in whole or in part;
(iv) staying further proceedings until the order is obeyed;
(v) dismissing the action or proceeding in whole or in part;
(vi) rendering a default judgment against the disobedient
party; or (vii) treating as contempt of court the failure to
obey any order except an order to submit to a physical or
mental examination.
Fed. R. Civ. P. 37(b)(2)(A)(i)-(vii). The Court has broad
discretion regarding the type and degree of discovery
sanctions it may impose pursuant to Rule 37 and can impose
any sanction it sees as just. Von Brimer v. Whirlpool
Corp., 536 F.2d 838, 844 (9th Cir. 1976). “When
sanctions are warranted, the Court must determine the
appropriate level or severity of sanctions based on the
circumstances of the case.” Daniels v. Jenson,
2013 WL 1332248, at *2 (D. Nev. Mar. 11, 2013).
SUMMARY
OF PARTIES' POSITIONS
Stone
argues that the newly ordered discovery and Court-ordered
deposition of Ms. Harris “has shown that
MillerCoors's misconduct on this score was even more
severe than previously understood.” Mot. at 6. First,
XXXXX Id. Second, Stone
argues that recent third-party productions, from Boston
Consulting Group [hereinafter “BCG”] and Andrews
Distributing, reveal further withholding of documents.
Id. at 7. Finally, Stone argues that it learned for
the first time at the settlement conference on October 2,
2019 XXXXX Id. at 8. Stone
argues that these “recent revelations demonstrate
MillerCoors's repeated and systematic failure to
comply” with its discovery obligations in this case and
thus warrant a variety of requested sanctions. Id.
at 8.
MillerCoors
opposes Stone's Motion on the following grounds: (1) with
respect to the historical Keystone materials,
“MillerCoors has already produced all
remaining Keystone marketing and packaging materials from the
Coors Archive as ordered by the Court;” (2) with
respect to the recent third-party productions from BCG and
Andrews Distributing, MillerCoors conducted a “thorough
and reasonable search for documents responsive to the
requests Stone Brewing actually served based
on the parties' agreed-upon [ESI] ...