United States District Court, D. Nebraska
GERALD J. KLEIN, Plaintiff,
TD AMERITRADE HOLDING CORPORATION, TD AMERITRADE, INC., and FREDRIC TOMCZYK, Defendants.
D. Thalken United States Magistrate Judge.
matter is before the court on TD Ameritrade Holding
Corporation, TD Ameritrade, Inc., and Fredric Tomczyk's
(collectively Ameritrade) Motion for Protective Order (Filing
No. 141) and lead plaintiff, Roderick Ford's (Ford)
Motion to Compel Responsive Discovery (Filing No. 149).
Ameritrade filed a brief (Filing No. 142) and an index of
evidence (Filing No. 143) in support of the Motion for
Protective Order. Ameritrade further filed a Supplemental
Motion for Protective Order (Filing No. 146) and an index of
evidence (Filing No. 147) in support of the supplemental
motion. Ford filed a brief (Filing No. 150) and an index of
evidence (Filing No. 151) in opposition to the motions for
protective order and in support of his motion to compel.
Ameritrade filed a brief (Filing No. 155) and an index of
evidence (Filing No. 156) in reply. Ford filed a brief
(Filing No. 157) and index of evidence (Filing No. 158) in
reply for his motion. Ameritrade filed a Motion for Leave to
File Sur-Reply (Filing No. 159) to which Ford responded
opposing the sur-reply, or in the alternative, seeking leave
to consult his expert witness and file a retort. For the
reasons set forth below, further briefing is denied,
Ameritrade's motions for protective order are granted and
Ford's motion to compel is denied without prejudice.
Ford alleges, Ameritrade violated federal securities law. See
Filing No. 1 -Complaint p. 1. Parties requested an in-person
conference prior to the entry of a scheduling order and the
hearing was held on August 9, 2016. See Filing No. 126.
During the hearing, counsel for the parties had an
opportunity to argue and raise challenges to the discovery
issues related to Ford's class certification claim. See
Filing No. 143-2 - Tr. p. 1-39. Ford specifically argued
against bifurcation of the discovery, but after a lengthy
discussion with counsel, the court bifurcated discovery and
ordered that no merit discovery would be allowed until the
class certification issue was resolved. Id. An
evidentiary hearing is scheduled for May 2, 2017, on the
class certification issue. See Filing No. 129 - Text Order.
asserts, on September 22, 2016, he served First Requests for
Production of Documents and on October 5, 2016, he served
First Set of Interrogatories on Ameritrade. See Filing No.
150 - Ford Brief p. 4. Ford alleges Ameritrade provide the
requested discovery even though such discovery is necessary
for Ford to support class certification. Id. 1-16.
Ameritrade contests Ford's discovery requests and alleges
Ford's requests violate the progression order by
attempting to obtain merit-based discovery, which is beyond
the scope of the progression order. See Filing No. 142
-Ameritrade Brief p. 1-10. Parties have attempted to resolve
the discovery issues without the court's involvement;
however, they have not been able to do so. See Filing No.
143-4 to -6.
discovery is initially limited to a class certification
issue, “the plaintiff bears the burden of advancing a
prima facie showing that [the class action requirements are
satisfied or] discovery is likely to produce substantiation
of the class allegations.” Jarrett v. Panasonic
Corp. of N. Am., 8 F.Supp.3d 1074, 1090 (E.D. Ark. 2013)
(quoting Mantolete v. Bolger, 767 F.2d 1416, 1424
(9th Cir. 1985)). Specifically, the plaintiff must
demonstrate “discovery measures are likely to produce
persuasive information substantiating the class action
allegations.” Doninger v. Pac. Nw. Bell, Inc.,
564 F.2d 1304, 1313 (9th Cir. 1977). “Mere speculation
that information might be useful will not suffice; litigants
seeking to compel discovery must describe with a reasonable
degree of specificity, the information they hope to obtain
and its importance to their case.” Telco Grp., Inc.
v. Ameritrade, Inc., No. 8:05CV387, 2006 WL 560635, at
*2 (D. Neb. Mar. 6, 2006) (citing Cervantes v. Time,
Inc., 464 F.2d 986, 994 (8th Cir. 1972)). Once the
plaintiff's burden is met, “[t]he party opposing a
motion to compel has the burden of showing its objections are
valid by providing specific explanations or factual support
as to how each discovery request is improper.”
Montes v. Union Pac. R. Co, No. 8:09CV226, 2010 WL
4684010, at *2 (D. Neb. Nov. 12, 2010) (citing St. Paul
Reinsurance Co. v. Commercial Fin. Corp., 198 F.R.D.
508, 511 (N.D. Iowa 2000)). “Bare assertions that
discovery requested is overly broad, unduly burdensome,
oppressive or irrelevant are ordinarily insufficient to bar
production.” Kellogg v. Nike, Inc., No.
8:07CV70, 2007 WL 4570871, at *10 (D. Neb. Dec. 26, 2007)
(citing St. Paul, 198 F.R.D. at 511-12). The
“party resisting discovery must show specifically how
each interrogatory or request for production is not relevant
or how each question is overly broad, burdensome or
oppressive.” Kooima v. Zacklift Int'l,
Inc., 209 F.R.D. 444, 446 (D.S.D. 2002).
reviewing parties' motions, briefs, and indexes of
evidence, the sole issue for the court is to decide whether
Ford has presented sufficient justification for the disputed
discovery to compel Ameritrade to disclose the information at
this time. Ford argues Ameritrade failed to show good cause
for denying Ford's discovery requests and the requested
information is necessary for Ford to prove his class
certification claim. See Filing No. 150 - Ford Brief p. 1-16.
Ford failed to substantiate why he needs additional discovery
to show class certification is warranted. The disputed
discovery expands beyond the scope of the class certification
issue. Ford seeks discovery encompassing “all
[Ameritrade] clients” and “all communications,
” which demonstrates the discovery surpasses the class
certification issue. In addition, Ford failed to limit the
discovery requests to a reasonable time frame; for instance,
Ford does not identify a time frame limited to demonstrate
specificity as required for the class certification issues.
See Filing No. 143-3.
stage of the litigation, the court finds no justification for
compelling Ameritrade to provide the requested discovery.
Ford's discovery requests are overbroad and, at this
time, not relevant, as beyond the scope of the class
certification issues. Moreover, Ameritrade has provided
extensive discovery on the lead plaintiffs' equity orders
and concedes, for purposes of the class certification
process, many of the plaintiff's elements of proof for
class certification. See Filing No. 155 Ameritrade Brief p.
Ameritrade contends the chief issues for class certification
are economic loss and reliance, neither of which relate to
the discovery sought by Ford. Id. Nevertheless, the
court finds Ford's motion to compel should be denied
without prejudice to allow Ford an opportunity to narrow the
requests and provide detailed justification correlating
specific discovery sought to class certification issues based
on the proportional needs of the case. See Fed.R.Civ.P.
26(b). Upon consideration, IT IS ORDERED:
Ameritrade's Motion for Protective Order (Filing No. 141)
and Supplemental Motion for Protective Order (Filing No. 146)
Ford's Motion to Compel Responsive Discovery (Filing No.
149) is denied without prejudice.
Ameritrade's Motion for Leave to File Sur-Reply (Filing
No. 159) is denied.
parties' Joint Motion to Extend Class Certification
Schedule (Filing No. 162) is granted. The parties shall have
to on or before January 6, 2017, to confer and submit a