United States District Court, E.D. Wisconsin
STADTMUELLER, U.S. DISTRICT JUDGE.
an action to recover funds which Plaintiff alleges were
fraudulently transferred to Defendant Rocky Point
International, LLC (“Rocky Point”). Before the
Court is Plaintiff's motion to compel production of
certain financial records, including bank statements, balance
sheets, income statements, and tax returns. (Docket #58).
Plaintiff wants to use these records for several purposes,
including attempting to undermine Rocky Point's
justifications for the transfers at issue in this case (such
as the upfront commission scheme and the cash pooling
agreement discussed at length in the parties'
summary-judgment submissions) and to show that the transfers
rendered the relevant entities insolvent. Id. at
3-5. Thus, Plaintiff seeks an order for Rocky Point to
produce: (1) all of Rocky Point's bank statements from
BMO Harris Bank, N.A. from October 1, 2013 through January
31, 2017; and (2) all fiscal year end reports, balance
sheets, profit and loss statements, tax returns, budget
reports, audited financial statements, and audit reports for
Rocky Point for the period January 1, 2013 through December
31, 2016. Id. at 7.
courts have broad discretion in deciding matters relating to
discovery. Packman v. Chicago Tribune Co., 267 F.3d
628, 646-47 (7th Cir. 2001); Rennie v. Dalton, 3
F.3d 1100, 1110 (7th Cir. 1993). Under Federal Rule of Civil
Procedure 26(b)(1), parties may obtain discovery
“regarding any nonprivileged matter that is relevant to
any party's claim or defense and proportional to the
needs of the case.” Fed.R.Civ.P. 26(b)(1). The
information sought need not itself be admissible to be
discoverable. Id. In considering matters of
proportionality, the Rule directs courts to consider
“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.” Id.; Elliot
v. Superior Pool Prods., LLC, No. 15-cv-1126, 2016 WL
29243, at *2 (C.D. Ill. Jan. 4, 2016).
Point initially resisted Plaintiff's discovery requests
as overly broad and unduly burdensome. As to the BMO Harris
bank statements, Rocky Point asserts that Plaintiff can
retrieve them from the bank directly by way of a subpoena.
(Docket #70 at 7). This objection makes no sense, however, as
the ability of a third party to produce records does not
obviate Rocky Point's duty to produce relevant documents
when they are within its control. See Fed. R. Civ. P
34(a). Moreover, Rocky Point does not dispute the notion that
it has easy access to its own bank statements. Thus, this
objection is without merit. See In re NASDAQ
Market-Makers Antitrust Litig., 169 F.R.D. 493, 530
(S.D.N.Y. 1996) (holding that a party can be ordered to
produce documents that it has the legal right and practical
ability to obtain from another).
regarding both the BMO Harris statements and the other
requested financial records, Rocky Point believes that the
narrow issue of fraudulent transfer presented in this suit
belies Plaintiff's asserted need for so many records over
such an expansive time period. However, it should be noted at
the outset that after Plaintiff filed his motion, Rocky Point
produced a large number of responsive documents-what it calls
“almost all” of the requested discovery. (Docket
#70 at 3). As of the filing of Plaintiff's reply, it
appears that Rocky Point has produced the sought-after tax
returns, bank statements from Wells Fargo and Bank of
America, “paperwork” concerning the underlying
loan and brokerage agreements, mortgage-related documents,
invoices and checks regarding improvements made to the
Pewaukee lake house, and “most of its financial
statements, books and records, and other financial
documents.” See Id. at 4-5; (Docket #76 at 2).
According to Rocky Point's opposition brief, this leaves
only “some third-party records” that have not
been produced, (Docket #70 at 9), although its later
supplement represents that there is nothing more to provide,
(Docket #76 at 2).
Plaintiff and this Court noticed the slippage in these
representations: the outside observer cannot be expected to
know what it means to produce “almost all” of the
relevant records or why some portion of those records has
been withheld while “most” have not. Put simply,
Rocky Point does not equip the Court or Plaintiff to assess
what has been produced and what has not, making it impossible
to determine whether other responsive records exist. In this
vacuum of certainty, the Court is obliged to enforce
compliance with Plaintiff's requests.
Federal Rules of Civil Procedure contemplate a scheme of
ongoing, fulsome disclosure of information and documents when
a party is presented with appropriate requests for the same.
They do not invite a game of hide-the-ball as to whether
relevant material is being withheld, or how much, or why.
Trial by ambush is no longer the name of the game.
Macaulay v. Anas, 321 F.3d 45, 50 (1st Cir. 2003).
noted above, “[p]arties may obtain discovery regarding
any nonprivileged matter that is relevant to any party's
claim or defense and proportional to the needs of the
case[.]” Fed.R.Civ.P. 26(b)(1). Rocky Point claims that
Plaintiff must also show that the records sought are
“indispensable, ” but this has never been the
relevant standard, (Docket #70 at 6),  and the Court
finds that Plaintiff's requests seek information relevant
to its claims and proportional to the needs of the case as a
whole, given the ease of locating and producing the records
and their potential probative value on the core questions at
issue in this lawsuit. At best, Rocky Point thinks that the
records sought will not turn out to be persuasive evidence in
Plaintiff's favor, but it is free to make that argument
at trial. It is not a reason to deny discovery.
the Court will enter an order compelling Rocky Point to
supplement its responses to provide: (1) all of Rocky
Point's bank statements from BMO Harris Bank, N.A. from
October 1, 2013 through January 31, 2017; and (2) all fiscal
year end reports, balance sheets, profit and loss statements,
tax returns, budget reports, audited financial statements and
audit reports for Rocky Point for the period January 1, 2013
through December 31, 2016. To the extent such records have already
been produced, they need not be produced again.
the Court must address Plaintiff's request for an award
of attorney's fees expended in connection with the
instant motion. Federal Rule of Civil Procedure
37(a)(3)(B)(iv) provides that if a party fails to produce
documents as requested, a party seeking discovery may move
for an order compelling production of documents. Fed.R.Civ.P.
37(a)(3)(B)(iv). If the motion is granted-or if the requested
discovery is provided after the motion was filed-the court
must, after giving an opportunity to be heard, require the
party whose conduct necessitated the motion to pay the
movant's reasonable expenses incurred in making the
motion, including attorney's fees. Id.
37(a)(5)(A). However, the court must not order such a payment
if (i) the movant filed the motion before attempting in good
faith to obtain the disclosure or discovery without court
action; (ii) the opposing party's nondisclosure,
response, or objection was substantially justified; or (iii)
other circumstances make an award of expenses unjust.
Plaintiff requests an award of fees and expenses in the
amount of $11, 500, arguing that although Rocky Point
produced most of what was asked for, it should have done so
sooner. See (Docket #77 at 11). The Court must deny
the request for a simple reason: other than baldly stating
the amount of their fees and expenses, Plaintiff has produced
not a single sworn statement or other shred of documentary
proof, such as time sheets or evidence regarding
counsel's billing rates, to substantiate the amount
claimed. Awarding Plaintiff an amount of fees seemingly
plucked from thin air would be unjust, as neither Rocky Point
nor the Court have the ability to interrogate the
reasonableness of the requested fees. See Commodity
Future Trading Comm'n v. Tade Exchange Network Ltd.,
159 F.Supp.3d 5, 8 (D.D.C. 2015) (proponent of fee award
under Rule 37 must show that rate requested and hours
expended are reasonable); Kamps v. Fried, Frank, Harris,
Shriver & Jacobson L.L.P., 274 F.R.D. 115, 120
(S.D.N.Y. 2011) (fees denied where no contemporaneous time
records describing work performed were timely submitted).
Thus, no award of fees will be made.
IT IS ORDERED that Plaintiff's motion to
compel discovery responses (Docket #58) be and the same is
hereby GRANTED in part and DENIED in
part as stated herein;
IS FURTHER ORDERED that Plaintiff's motion to
restrict an exhibit submitted in connection with his motion
to compel (Docket #60) be and the same is hereby
IS FURTHER ORDERED that Defendant supplement its
discovery responses as required by this Order no later than