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Pelayo v. Platinum Limousine Services, Inc.

United States District Court, D. Hawaii

January 5, 2018





         On October 19, 2017, the Magistrate Judge granted Plaintiffs' Motion to Compel and ordered Defendants to provide satisfactory responses to long-standing discovery requests. In doing so, however, the Magistrate Judge denied Plaintiffs' request for attorneys' fees associated with the motion. Although the Magistrate Judge acknowledged that Federal Rule of Civil Procedure 37(a)(5)(A) ordinarily requires the payment of expenses, including such fees, if a motion to compel is granted, he denied Plaintiffs' request, finding that “circumstances make an award of expenses unjust, ” based upon his conclusion that the case was “being driven almost entirely by attorneys' fees.” 10/19/17 Order at 4, Dkt. No 166.

         Plaintiffs now appeal only the portion of the Magistrate Judge's October 19, 2017 Order denying their request for attorneys' fees.[1] Because the Magistrate Judge granted Plaintiffs the relief sought in their Motion to Compel and the award of expenses is not unjust in light of the specific circumstances supporting Plaintiffs' request-defense counsel's discovery conduct-the Court reverses only the portion of the Magistrate Judge's Order denying Plaintiffs' fees under Federal Rule of Civil Procedure 37(a)(5)(A). Plaintiffs are awarded $8, 740.83 in fees.


         I. Settlement Of Claims And Appeal Of Order Awarding Attorneys' Fees

         Plaintiffs Arsenio Pelayo and Brandon Boreliz, limousine driver-employees of Platinum Limousine Services, Inc. (“Platinum”), filed a collective action against Platinum and its principal, Kurt Tsuneyoshi, alleging that Defendants failed to pay wages and expenses for various employment-related activities, as required by state and federal law.[2] The parties settled the underlying claims on January 15, 2016.[3]See Dkt. No. 122.

         On September 27, 2016, Plaintiffs were awarded $47, 917.34 in fees and costs under the Court's Order Adopting in Part and Modifying in Part the Magistrate Judge's Findings and Recommendation on Plaintiffs' Motion for Attorneys' Fees and Costs. Dkt. No. 139 (9/27/16 Order). On October 27, 2016, Defendants appealed the award, Dkt. No. 140, and Plaintiffs cross-appealed. Dkt. No. 141. No stay of execution of the judgment was sought by Defendants in this Court prior to the filing of Plaintiffs' Motion to Compel, nor was a supersedeas bond posted.

         II. Plaintiffs' Motion To Compel

         Plaintiffs served written discovery requests on Tsuneyoshi, pursuant to Federal Rule of Civil Procedure 69(a)(2), on January 27, 2017.[4] Dkt. No. 148-3. When the discovery requests went unanswered, Plaintiffs sought to meet and confer with Defendants' counsel on several occasions. See Decl. of Richard Holcomb ¶ 30, Dkt. No. 168-2. Plaintiffs also informed Defendants' counsel, beginning in February 2017, that Plaintiffs would stipulate to a stay of collection if Defendants posted a sufficient surety bond. According to Plaintiffs, the only response received to their discovery requests and offer was sent on April 11, 2017. On that date, instead of answering the interrogatories and producing documents, Defendants wrote the following after each of Plaintiffs' requests:

Kurt Tsuneyoshi objects on the ground that, as you have previously been informed, an appellate bond is being posted in connection with the de minimis/nuisance value settlement of $5, 575.00 (total) you obtained on behalf of two of your clients. Kurt Tsuneyoshi further objects on the ground that all discovery is stayed pending mediation.

Holcomb Decl. ¶ 21, Dkt. No. 148-2. Plaintiffs' counsel immediately objected to the sufficiency and accuracy of these responses. Holcomb Decl. ¶ 24, Dkt. No. 148-2. Indeed, from April 11 until June 22, 2017, Plaintiffs sent four more letters and e-mails, following up on the discovery issues and requesting a meet and confer. Holcomb Decl. ¶¶ 23-28, Dkt. No. 148-2. When the parties were finally able to schedule a meet and confer for July 5, 2017, defense counsel did not appear or return Plaintiffs' counsel's telephone calls. Five days later, counsel for Defendants emailed Plaintiffs' counsel and, on July 25, 2017, counsel for the parties did meet and confer. Holcomb Decl. ¶¶ 34-39, Dkt. No. 148-2. At that meet and confer, defense counsel promised that the bond would be posted on July 28, 2017, and, in exchange, Plaintiffs agreed to forego further discovery responses. Holcomb Decl. ¶ 39, Dkt. No. 148-2.

         When no bond (or discovery responses) was provided by the July 28 deadline, Plaintiffs again wrote defense counsel requesting the posting of the bond by no later than August 10, 2017 or, at minimum, an assurance that the bond would be posted by August 11, 2017. Holcomb Decl. ¶ 41, Dkt. No. 148-2.

         Receiving no response, on August 11, 2017, Plaintiffs filed a Motion to Compel Answers to Plaintiffs' First Interrogatories and Request for Production of Documents Pursuant to Fed. R. Civ. P., Rule 69(a)(2) or Alternatively, the Posting of a Supersedeas Bond (“Motion to Compel”). Dkt. No. 148. By that motion, Plaintiffs sought an order compelling responses to Plaintiffs' discovery requests that were served pursuant to Rule 69(a)(2) on January 27, 2017. In the alternative, Plaintiffs requested the posting of a supersedeas bond in the amount of the judgment at issue, $47, 917.34. Plaintiffs also sought sanctions, including, but not limited to, an award of fees and costs, pursuant to Rule 37(a)(5). See Mem. in Supp. of Mot. to Compel at 2-3, Dkt. No. 148-1.

         Defendants filed a response to Plaintiffs' Motion to Compel on August 28, 2017. The response did not cogently explain why no stay had been sought nor any bond posted since the entry of the Court's 9/27/16 Order, other than to mention “failed settlement attempts.” See Dkt. No. 151 at 2. Defendants also objected to the requested discovery as improper “hybrid” requests that exceeded the limits of the Federal Rules and that were propounded to harass Defendants. Id. at 4-5.

         For the first time at the September 18, 2017 hearing on the Motion to Compel, defense counsel informed the Magistrate Judge and Plaintiffs' counsel that Defendants had, in fact, obtained a bond and would seek a stay. Dkt. No. 161 (9/18/17 Hrg. Tr.). In part because the bond was not provided to either the Magistrate Judge or Plaintiffs, however, the Magistrate Judge directed the parties to meet and confer to attempt to reach resolution and “to file an appropriate request for a stay.” The Magistrate Judge continued the hearing on the Motion to Compel to October 4, 2017.

         III. 10/19/17 Order And Appeal

         The parties were unable to reach a resolution on Plaintiffs' outstanding discovery requests, and Defendants did not file a motion for a stay. As a result, at the October 4, 2017 continued hearing, the Magistrate Judge granted in part and denied in part the Motion to Compel, and set an October 25, 2017 deadline for Defendants' supplemental responses. Dkt. No. 163 ...

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