United States District Court, D. Nebraska
COR CLEARING, LLC, a Delaware limited liability company, Plaintiff,
CALISSIO RESOURCES GROUP, INC., a Nevada corporation, ADAM CARTER, an individual, SIGNATURE STOCK TRANSFER, INC, A Texas corporation; and DOES 1-50, Defendants.
MEMORANDUM AND ORDER
E. STROM, Senior Judge.
matter is before the Court on the motion of the plaintiff,
COR Clearing, LLC, to compel discovery responses (Filing No.
199). The matter has been fully briefed.
See Filing Nos. 200, 201, 215, 216, and 223. After
review of the motion, the parties' briefs and
accompanying indexes of evidence, and the relevant law, the
Court finds as follows.
August 26, 2015, COR Clearing LLC (“COR” or
“plaintiff”) filed its first complaint against
Calissio Resources Group, Inc. (“Calissio”), Adam
Carter (“Carter”), Signature Stock Transfer, Inc.
(“Signature”), and Does 1-50 (Filing No.
1). Plaintiff's complaint alleged three causes
of action including: (1) a request for declaratory judgment;
(2) unjust enrichment; and (3) fraud. See Id. at
9-13. The complaint alleged that defendants “calculated
[a] scheme to defraud the marketplace and the clearing system
in order to obtain millions of dollars from unsuspecting
market participants by exploiting a weakness in the dividend
payment system of the third-party Depositary [sic] Trust
Clearing Corporation (“DTCC”).”
(Id. at 1).
November 10, 2015, following a hearing, the Court denied
COR's expedited motion (Filing No. 20) for the
appointment of a limited purpose receiver (Filing No.
80). On December 8, 2015, the Court denied
Signature's motion (Filing No. 29) to dismiss
(Filing No. 85). On April 21, 2016, the Court
granted plaintiff's application (Filing No. 108)
for default judgment against Calissio Resources Group, Inc.
(Filing No. 109). On May 23, 2016, the Court granted
plaintiff's motion (Filing No. 94) to compel TD
Ameritrade Clearing, Inc. (“TDAC”) “to
produce documents and things responsive to [plaintiff's]
subpoena served on or about December 4, 2015.” (Filing
August 2, 2016, the Court granted plaintiff leave to file an
amended complaint (Filing No. 122). The amended
complaint (Filing No. 123) added four brokerage
defendants, namely, National Financial Services, LLC
(“NFS”), TDAC, E-Trade Clearing, LLC
(“E-Trade”), and Scottrade, Inc.
(“Scottrade”) (collectively the “Clearing
Firm Defendants”). On December 9, 2016, the Court
denied the Clearing Firm Defendants' joint motion (Filing
No. 137) to dismiss the amended complaint (Filing
No. 160). On January 25, 2017, COR sought and was
granted leave to again amend its complaint (Filing Nos. 171
and 174). On January 30, 2017, COR filed its Second
Amended Complaint (Filing No. 175). On February 10,
2017, NFS filed its answer (Filing No. 181). On
February 13, 2017, defendants TDAC and Scottrade filed their
respective answers (Filing Nos. 183 and 184). On February 15,
2017, E-Trade filed its answer (Filing No. 186).
March 6, 2017, the Court issued its Third Amended Final
Progression Order (Filing No. 193). On April 3,
2017, Signature brought a motion to compel COR's
production of 43 different requests for production (Filing
No. 194). On June 2, 2017, the Court denied
Signature's motion to compel (Filing No. 228).
On April 14, 2017, COR brought the instant motion seeking to
compel certain discovery responses (Filing No. 199).
Rule of Civil Procedure 26(b)(1) allows
[p]arties [to] obtain discovery regarding any nonprivileged
matter that is relevant to any party's claim or defense
and proportional to the needs of the case, considering the
importance of the issues at stake in the action, the amount
in controversy, the parties' relative access to relevant
information, the parties' resources, the importance of
the discovery in resolving the issues, and whether the burden
or expense of the proposed discovery outweighs its likely
benefit. Information within this scope of discovery need not
be admissible in evidence to be discoverable.
Fed. R. Civ. P. 26(b)(1). The United States Supreme Court has
held that discovery under Rule 26 should be “construed
broadly to encompass any matter that bears on, or that
reasonably could lead to other matter that could bear on, any
issue that is or may be in the case.” Oppenheimer
Fund, Inc. v. Sanders, 437 U.S. 340, 351, 98 S.Ct. 2380,
57 L.Ed.2d 253 (1978). However, this broad interpretation and
liberal application of the rule does not provide unlimited
discovery. Oppenheimer, 437 U.S. at 351;
see also Hickman v. Taylor, 329 U.S. 495,
507, 67 S.Ct. 385, 91 L.Ed. 451 (1947) (stating
“discovery, like all matters of procedure, has ultimate
and necessary boundaries.”).
“[t]he party seeking discovery must satisfy some
threshold showing of relevancy before discovery is
required.” Lubrication Technologies, Inc. v.
Lee's Oil Service, LLC, Civil No. 11-2226
(DSD/LIB), 2012 WL 1633259, at *2 (D. Minn. April 10, 2012)
(internal citation omitted). However, “[o]nce that
threshold has been met, the resisting party ‘must show
specifically how . . . each . . . [request for production] is
not relevant or how [the discovery] is overly broad,
burdensome, or oppressive.'” Lubrication
Technologies, 2012 WL 1633259, at *2 (quoting St.
Paul Reinsurance Co., Ltd. v. Commercial Financial
Corp., 198 F.R.D. 508, 512 (N.D. Iowa 2000))
(alterations in original).
of relevance in discovery rulings are left to the sound
discretion of the trial court . . . .” Hayden v.
Bracy, 744 F.2d 1338, 1342 (8th Cir. 1984) (internal
citations omitted). District courts may limit “the
scope of discovery after balancing a number of
interests.” Slate v. American Broadcasting
Companies, Inc., 802 F.Supp.2d 22, 26 (D.D.C. 2011)
(citing In re Sealed Case (Medical Records), 381
F.3d 1205, 1215 (D.C. Cir. 2004) (additional citations and
seeks an order compelling the Clearing Firm Defendants
“to designate a 30(b)(6) witness to testify as to
certain topics and to produce documents . . . .”
(Filing No. 199 at 1). Specifically, COR seeks to
compel Rule 30(b)(6) deposition testimony on deposition
topics 2, 18, 41, and 42 (Filing No. 200). In
addition, COR seeks to compel the production of documents to
Requests for Production (“RFP”) 10-11 (First
Set), 2, 9 (as to NFS and E-Trade only), 25, and 26 (Second
Set), and 15 and 18 (First Set) (Id.). The Court
will discuss each in turn.
Deposition TopicNo. 2 and RFP Nos. 10-11 (First Set) and ...