Sequatchie Mountain Creditors et al v. Detweiler et al

OCR transcription for search; preserved printed pages are authoritative

The court incorporates by reference in this paragraph and adopts as the findings and orders
of this court the document set forth below.

Russ Kendig
United States Bankruptcy Judge

UNITED STATES BANKRUPTCY COURT
NORTHERN DISTRICT OF OHIO

EASTERN DIVISION
IN RE: ) CHAPTER 11
)
JOSEPH J. DETWEILER, ) CASE NO. 09-63377
)
Debtor. ) ADV. NO. 09-6118
)
SEQUATCHIE MOUNTAIN ) JUDGE RUSS KENDIG
CREDITORS, )
)
Plaintiff, »)
)
Vv. ) MEMORANDUM OF OPINION
) (NOT INTENDED FOR
JOSEPH J. DETWEILER, ) PUBLICATION)
Defendant.

Defendant moves to dismiss certain plaintiffs from this action based on their failure
to comply with discovery orders, including an order to compel. Some of the plaintiffs, but
not all, object to dismissal.

The court has jurisdiction of this proceeding pursuant to 28 U.S.C. § 1334 and the
general order of reference entered in this district on July 16, 1984. Venue in this district and
division is proper pursuant to 28 U.S.C. § 1409. This is a core proceeding under 28 U.S.C.

§ 157(b)(2)(D.

This opinion is not intended for publication or citation. The availability of this
opinion, in electronic or printed form, is not the result of a direct submission by the Court.

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On April 1, 2010, Defendant served initial discovery requests on the eighteen named
plaintiffs! identified in the opening paragraph of the complaint. On March 18, 2011, more
than one year later, Defendant moved to compel responses to those requests. The court
granted the order to compel on April 20, 2011.

Defendant now seeks dismissal of eleven plaintiffs from this proceeding, alleging
a failure to comply with the order to compel. Seven of the eleven plaintiffs do not oppose
dismissal. They are Donald Bird, Patricia Bird, Joseph Kohan, Teresa Kohan, John Hallman
(deceased), Roger Pearson and Sharon Pearson. Since there is no controversy between the
parties as to these seven parties, the motion to dismiss the claims of these plaintiffs is
granted. The court must determine whether to dismiss the case of the remaining four
plaintiffs: Lisa Allen, Robert Allen, Shirley Hallman and Wesley Jinks?

The facts are shocking. According to the plaintiffs, they complied with the April 1,
2010 discovery request on:

Plaintiff Interrogatories Production of Documents
Lisa Allen March 23, 2011 May 12, 2011
Robert Allen March 23, 2011 May 12, 2011
Shirley Hallman April 6, 2011 May 10, 2011
Wesley Jinks April 6, 2011 May 10, 2011

Obviously, their compliance far exceeds the parameters set forth in the federal rules of
bankruptcy procedure and the applicable rules of federal civil procedure.

However, there are intervening circumstances which may assuage the harsh facts.
A primary issue in the main case involved ArborOne, a secured creditor. ArborOne’s
disputes were the subject of lengthy settlement negotiations and it was not clear if resolution
of those disputes would have a material impact on this adversary. In October 2010, the court
continued a pretrial conference for two months so the parties could determine the impact of
the ArborOne settlement on this adversary. The potential impact of the settlement
negotiations is also evident through the multiple discovery extensions entered by the court.

The court entered the following orders related to discovery:

' A motion to join additional parties as plaintiffs is pending. Although there is
discussion of this issue in the reply and sur-reply to the present motion, the court
reserves discussion until it is ripe under the joinder motion.

2 The motion does not seek dismissal of the seven remaining named plaintiffs in the
complaint: Gay Glassman, Vincent Agusta, Mary Alice R. Agusta, Paul Meschino,
Lana Meschino, Robert Friske and Deborah Friske.

2

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Document No. Date Entered Discovery Deadline

10 January 6, 2010 June 30, 2010
15 July 22, 2010 September 30, 2010
19 December 23,2010 July 15, 2011

Although entitled to the responses much earlier, Defendant waited until March 2011,
approximately ten months after the responses were due, to push the issue. The motion to
compel was filed on March 18, 2011 and identified all eighteen named plaintiffs. Not one
plaintiff objected to the motion to compel. An order® granting the motion to compel was
docketed on April 20, 2011 and required compliance by April 18, 2011. To be clear, the
order was entered affer the deadline for compliance established in the order. As Plaintiffs
point out, complying with the order was impossible.

Additionally, the order to compel directed only twelve plaintiffs to provide responses.
Lisa Allen and Robert Allen were not among the plaintiffs compelled to provide discovery
responses. As a result, the court will not dismiss them from this action. It would be unfair
to dismiss them for failing to comply with an order that did not direct them to do anything.

That leaves Shirley Hallman and Wesley Jinks as the remaining plaintiffs against
whom dismissal is sought. The motion to dismiss indicates that Shirley Hallman and Wesley
Jinks furnished the requested discovery on the same day the motion to dismiss was filed.
Thus, at the time of filing, Defendant’s own motion indicates they had fully complied with

the discovery request, albeit inexplicably late.

Federal Rule of Bankruptcy Procedure 7037(b)(2) gives a court numerous sanction
options for a party who fails to obey an order to compel discovery, including dismissal. Fed.
R. Bankr. P. 7037(b)(2)(A)(v). Under the facts of this case, Defendant’s request for the
harshest sanction is not warranted. This conclusion, however, is not intended to condone the

dilatory behavior of the plaintiffs.

Two specific facts militate against dismissal based on a failure to comply with the
order to compel. First, at the time it was entered, plaintiffs were unable to comply with the
order because it was entered after the deadline set forth in the order. Second, at the time the
motion to dismiss was filed, Defendant’s own statements indicate the plaintiffs had complied
with the order to compel. Therefore, the court will also deny the motion to dismiss as it
applies to Shirley Hallman and Wesley Jinks.

Plaintiffs have clearly been inexplicably tardy in responding to Defendant’s discovery
request. The court will award Defendant the payment of his expenses under Bankruptcy Rule

> The order references plaintiffs other than the eighteen named plaintiffs in the
complaint.

Lo

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7037(b)(2)(C). Counsel for plaintiffs is ordered to pay the reasonable expenses, including
attorney’s fees, for the motion to compel.

An order will be entered immediately.

#t # it

Service List:

Peter G. Tsarnas
Goldman & Rosen, Ltd.
11 South Forge Street
Akron, OH 44304

Scott M Zurakowski

PO Box 36963

4775 Munson St NW
Canton, OH 44735-6963

Anthony J DeGirolamo
116 Cleveland Ave., N.W.
Suite 307

Canton, OH 44702

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