The opinion
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8 UNITED STATES DISTRICT COURT
9 SOUTHERN DISTRICT OF CALIFORNIA
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11 SOUTHERN NATURAL RESOURCES, Case No.: 20-CV-2144-JES(WVG)
LLC,
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ORDER FOLLOWING MAY 12, 2023
Plaintiff,
13 DISCOVERY HEARING
v.
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(ECF No. 207, 212, 228, 229, and 239)
NATIONS ENERGY SOLUTIONS, INC.
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et al ,
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Defendants.
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19 I. BACKGROUND
20 Pending before this Court are five discovery motions filed by the Parties. (ECF No.
21 207, 212, 228, 229, and 239.) On March 24, 2023, the Court sua sponte converted the May
22 12, 2023 Video Discovery Conference to an in-person discovery hearing and ordered all
23 parties and representatives, with full and complete settlement authority, and counsel
24 responsible for the litigation to appear. (ECF No. 251.)
25 On May 12, 2023, the Court convened an in-person discovery hearing to address
26 each pending discovery motion along with the underlying discovery disputes. (“May 12,
27 2023 Discovery Hearing”, ECF No. 269.) Richard K. Welsh and Jeffrey Zuidema appeared
28 on behalf of Plaintiff – Counter-Defendant Southern Natural Resources, LLC (“SNR”) and
1 Counter-Defendants TG High Prairie, LLC (“TGHP”), TG High Prairie Land, LLC
2 (“TGHPL”), Terra-Gen Operating Company, LLC (“TGOC”), Terra-Gen, LLC (“TG”),
3 Terra-Gen Power, LLC (collectively referred to as “Terra-Gen Counter-Defendants”) and
4 Randy Hoyle. Yuanlong Hu appeared as the client representative for SNR and Terra-Gen
5 Defendants. Randy Hoyle appeared on behalf of Counter-Defendant Randy Hoyle. Daniel
6 P. Scholz and Lindsey C. Herzik appeared on behalf of Defendant – Counterclaimant
7 Nations Energy Solutions, Inc (“NES”). Kirk Tracey appeared as the client representative
8 for NES. Suzanne Pollack and Maggie E. Schroedter appeared on behalf of Defendant
9 Bergstrom Renewables, LLC, Eric Bergstrom, and Robert Bergstrom (collectively referred
10 to as “Bergstrom Defendants”). Eric Bergstrom and Robert Bergstrom appeared as client
11 representatives for Defendant Bergstrom Renewables, LLC, and in their individual
12 capacity as Defendant Eric Bergstrom and Robert Bergstrom.
13 At the May 12, 2023 Discovery Hearing, the Court provided counsel the opportunity
14 to address whether any of the five pending motions had been resolved or were still at issue.
15 Based upon the representations and oral arguments made by the parties, the Court
16 addressed and ruled on the following motions from the bench: (1) NES’ Motion for
17 Protective Order to Prevent the Compulsion of NES’s Responses to Randy Hoyle’s Special
18 Interrogatories, Set Two, Nos. 10-19 and TGHPL’s Special Interrogatories, Set Two, Nos.
19 18-20 (ECF No. 207), (2) SNR’s Motion for Protective Order to Preclude the Deposition
20 of James Pagano and SNR’s 30(b)(6) Representative and Request for Sanctions (ECF No.
21 212), (3) TGHPL’s Motion to Compel Further Responses from NES to TGHPL’s
22 Interrogatories, Set One, Nos. 2-4, 8, and 14 (ECF No. 228), (4) TGHPL’s Motion to
23 Compel Further Responses from Defendant Robert Bergstrom to TGHPL’s Interrogatories,
24 Set One, Nos. 1, 3, and 7 (ECF No. 229), and (5) NES’s Motion to Compel the Deposition
25 of SNR’s Person Most Qualified (ECF No. 239).
26 Although the Court addressed and ruled on SNR’s Motion for Protective Order to
27 Preclude the Deposition of James Pagano and SNR’s 30(b)(6) Representative and Request
28 for Sanctions (ECF No. 212), the Court deferred ruling on five deposition topics in dispute
1 included in SNR’s Motion for Protective Order to Preclude the Deposition SNR’s 30(b)(6)
2 Representative. The Court now summarizes each of its rulings made from the bench and
3 addresses the five remaining deposition topics, Deposition Topics No. 39, 40, 42, 43, and
4 45 Proposed by the Bergstrom Defendants.
5 II. RULINGS ON THE BENCH
6 a. ECF No. 207 – Motion for Protective Order to Prevent the Compulsion of
7 NES’s Responses to Randy Hoyle’s Special Interrogatories, Set Two, Nos.
8 10-19 and TGHPL’s Special Interrogatories, Set Two, Nos. 18-20
9 NES’s Motion for Protective Order to Prevent the Compulsion of NES’s Responses
10 to Randy Hoyle’s Special Interrogatories, Set Two, Nos. 10-19 and TGHPL’s Special
11 Interrogatories, Set Two, Nos. 18-20 (“NES’ Motion for Protective Order Regarding Hoyle
12 and TGHPL’s Special Interrogatories”) sought preclusion of NES’s obligation to respond
13 to discovery due to the volume of interrogatories previously propounded by TGHPL and
14 the Bergstrom Defendants, and NES and the Bergstrom Defendants’ joint motion to modify
15 the Court’s November 19, 2021 Discovery Order which sought limitations on the number
16 of interrogatories allowed (“Motion to Modify”. ECF No. 200). (ECF No. 207 at 2.) NES
17 also sought sanctions for attorney’s fees in the amount of $1,050.00 for three hours spent
18 preparing its motion. (ECF No. 207 at 7.) On February 24, 2023, Honorable Andrew G.
19 Schopler held an informal discovery conference to address other discovery disputes and
20 the Motion to Modify. (ECF No. 237.) In pertinent part, Judge Schopler ordered:
21 Discovery limits in this case are now as follows: (1) limits are per side, rather
than per party; (2) defendants constitute one side, and plaintiff and all counter-
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defendants together constitute one side; (3) going forward, each side may
23 propound a maximum of 20 additional special interrogatories and 10
additional requests for production of documents; (4) discovery requests served
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before February 24, 2023, do not count against these new limits; (5) responses
25 to all currently outstanding discovery requests are due to the propounding
party on the dates that the Court has previously ordered or, when no such order
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applies, on the dates to which the parties have already agreed or, when there
27 has been no such prior agreement, March 10, 2023; and (6) plaintiff's special
status allowing for "per-defendant" discovery limits (see ECF 51) is
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1 terminated.
(ECF No. 237.)
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This Court’s reading of Judge Schopler’s February 24, 2023 ruling renders NES’s
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Motion for Protective Order Regarding Hoyle and TGHPL’s Special Interrogatories moot.
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At the May 12, 2023 Discovery Hearing, SNR and NES both agreed the substantive
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discovery disputes underlying NES’s Motion for Protective Order Regarding Hoyle and
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TGHPL’s Special Interrogatories had been mooted by Judge Schopler’s February 24, 2023
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Order (ECF No. 237). However, NES contended part of the motion remained as NES still
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sought sanctions for attorney’s fees and costs related to filing its motion.
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As both Parties and the Court agreed the substantive dispute underlying NES’s
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Motion for Protective Order Regarding Hoyle and TGHPL’s Special Interrogatories was
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no longer in dispute, NES’s Motion for Protective Order to Prevent the Compulsion of
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NES’s Responses to Randy Hoyle’s Special Interrogatories, Set Two, Nos. 10-19 and
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TGHPL’s Special Interrogatories, Set Two, Nos. 18-20 is DENIED AS MOOT. The Court
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further DENIES NES’s sanctions request for attorney’s fees in the amount of $1,050.00.
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b. ECF No. 212 – SNR’s Motion for Protective Order to Preclude the
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Deposition of James Pagano
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SNR’s Motion for Protective Order to Preclude the Deposition of James Pagano
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sought an order from the Court preventing the deposition of Terra-Gen’s CEO James
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Pagano (“Mr. Pagano”) in light of the apex doctrine and SNR’s contentions that Mr.
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Pagano had no unique first-hand knowledge which would not be duplicative testimony in
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light of the depositions of Defendant Hoyle. (See ECF No. 212.) In contrast, NES and the
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Bergstrom Defendants contend Mr. Pagano had unique knowledge about Defendant
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Hoyle’s authority to bind Terra-Gen in Mr. Pagano’s capacity as CEO and Mr. Hoyle’s
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supervisor. (See ECF No. 226, 227.)
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Once again, the Court found itself in the midst of a dispute and heavy motion practice
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for a matter that the Parties seemingly could (and in fact did) resolve themselves. In
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pertinent part, although SNR disputed the relevancy and appropriateness of deposing Mr.
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1 Pagano, SNR previously offered Mr. Pagano for a two-hour deposition. (ECF No. 212 at
2 5.) Despite this offer by SNR, the Parties proceeded with filing SNR’s Motion for
3 Protective Order to Preclude the Deposition of James Pagano (ECF No. 212) and the
4 numerous opposition and reply briefs related to the motion (ECF No. 222, 226, 227, 230,
5 238). In light of the Parties’ clear failures to meaningfully meet and confer amongst
6 themselves thus far in the discovery process, during the May 12, 2023 Discovery Hearing
7 the Court provided the Parties with an opportunity to meet and confer to determine whether
8 counsel could work amongst themselves to resolve this dispute. As evidenced by the
9 Parties’ compromise after a ten-minute meet and confer, the Parties clearly could and
10 should have resolved this issue amongst themselves without engaging in motion practice.
11 As agreed to by the Parties during the May 12, 2023 Discovery Hearing, Terra-Gen’s
12 CEO James Pagano shall be produced for deposition at a time and place agreed to by the
13 Parties, limited to a maximum of two and a half (2.5) hours. Accordingly, SNR’s Motion
14 for Protective Order to Preclude the Deposition of James Pagano (ECF No. 212) is
15 DENIED AS MOOT.
16 c. ECF No. 212 – SNR’s Motion for Protective Order to Preclude Deposition
17 Topics No. 5, 6, and 16 Proposed by NES Related to the Deposition of
18 SNR’s 30(b)(6) Representative
19 The Court summarizes below its rulings made on May 12, 2023 regarding SNR’s
20 Motion for Protective Order to Preclude Deposition Topics No. 5, 6, and 16 Proposed by
21 NES related to the deposition of SNR’s 30(b)(6) representative.
22 i. NES’s Deposition Topic No. 5
23 For the reasons stated on the record, the Court SUSTAINS SNR’s objections to this
24 deposition topic and SNR’s Motion for Protective Order Precluding Deposition Topic No.
25 5 is GRANTED. SNR need not produce a 30(b)(6) witness for this deposition topic.
26 ii. NES’s Deposition Topic No. 6
27 For the reasons stated on the record, the Court SUSTAINS SNR’s objections to this
28 deposition topic and SNR’s Motion for Protective Order Precluding Deposition Topic No.
1 6 is GRANTED. SNR need not produce a 30(b)(6) witness for this deposition topic.
2 iii. NES’s Deposition Topic No. 16
3 Topic No. 16 seeks “Meetings between SNR, NES and Vestas Development around
4 May 2018”. As stated on the record, the Court OVERRULES SNR’s objections that Topic
5 No. 16 is overbroad and burdensome. The topic is limited to the timeframe of one month
6 and SNR’s counsel conceded at the May 12, 2023 Discovery Hearing that SNR understood
7 NES meant the entity of “Vestas America” notwithstanding misidentifying it as “Vesta
8 Development”. Thus, the Court ORDERS SNR to produce a 30(b)(6) representative to
9 testify about this topic, with the modification that the entity is “Vestas America”, not
10 “Vestas Development”.
11 SNR’s Motion for Protective Order Precluding Deposition Topic No. 16 is DENIED.
12 d. ECF No. 212 – SNR’s Motion for Protective Order to Preclude Deposition
13 Topics No. 6, 7, 8, 13, and 33 Proposed by the Bergstrom Defendants
14 Related to the Deposition of SNR’s 30(b)(6) Representative
15 The Court summarizes each ruling made on May 12, 2023 regarding the Bergstrom
16 Defendants’ Deposition Topics No. 6, 7, 8, 13, and 33.
17 i. Bergstrom Defendants’ Deposition Topic No. 6
18 For the reasons stated on the record, the Court SUSTAINS SNR’s objections to this
19 deposition topic and SNR’s Motion for Protective Order Precluding Bergstrom
20 Defendant’s Deposition Topic No. 6 is GRANTED. SNR need not produce a 30(b)(6)
21 witness for this deposition topic.
22 ii. Bergstrom Defendants’ Deposition Topic No. 7
23 For the reasons stated on the record, the Court SUSTAINS SNR’s objections to this
24 deposition topic and SNR’s Motion for Protective Order Precluding Bergstrom
25 Defendant’s Deposition Topic No. 7 is GRANTED. SNR need not produce a 30(b)(6)
26 witness for this deposition topic.
27 iii. Bergstrom Defendants’ Deposition Topic No. 8
28 For the reasons stated on the record, the Bergstrom Defendants’ Deposition Topic
1 No. 8 is overbroad and burdensome. The Court SUSTAINS SNR’s objections to this
2 deposition topic and SNR’s Motion for Protective Order Precluding Bergstrom
3 Defendant’s Deposition Topic No. 8 is GRANTED. SNR need not produce a 30(b)(6)
4 witness for this deposition topic.
5 iv. Bergstrom Defendants’ Deposition Topic No. 13
6 As to Deposition Topic No. 13, at the May 12, 2023 Discovery Hearing the
7 Bergstrom Defendants acknowledged that the Court’s ruling on NES’s Deposition Topic
8 No. 16 should apply as both topics sought testimony about “Meetings between SNR, NES
9 and Vestas Development” (also known as Vestas America). The only difference between
10 NES Topic. No. 16 and Bergstrom Defendants’ Topic No. 13 was that the latter further
11 defined the timeframe and topic to “in April through May 2018 relating to the NES
12 development assets”. For the reasons stated on the record, the Court OVERRULES SNR’s
13 objections that Topic No. 13 is overbroad and burdensome and SNR’s Motion for
14 Protective Order Precluding Bergstrom Defendant’s Deposition Topic No. 13 is DENIED.
15 Thus, the Court ORDERS SNR to produce a 30(b)(6) representative to testify about
16 this topic, with the modification that the entity is “Vestas America”, not “Vestas
17 Development”.
18 v. Bergstrom Defendants’ Deposition Topic No. 33
19 For the reasons stated on the record, the Court OVERRULES SNR’s objections that
20 the Bergstrom Defendant’s Deposition Topic No. 33 requires a lay witness to testify as an
21 expert. Accordingly, SNR’s Motion for Protective Order Precluding Bergstrom
22 Defendants’ Deposition Topic No. 33 is DENIED.
23 The Court ORDERS SNR to produce a 30(b)(6) representative to testify to the topic
24 of “The factual basis for SNR’s calculation of damages”.
25 / / /
26 / / /
27 / / /
28 / / /
1 e. ECF No. 228 and 229 – TGHPL’s Motions to Compel NES’s
2 Supplemental Responses to TGHPL’s Interrogatories, Set One, Nos. 1, 3,
3 and 7 and Defendant Robert Bergstrom’s Supplemental Responses to
4 TGHPL’s Interrogatories, Set One, Nos. 2-4, 8, and 14
5 TGHPL’s Motion to Compel NES’s Supplemental Responses to TGHPL’s
6 Interrogatories, Set One, Nos. 1, 3, and 7 and Motion to Compel Defendant Robert
7 Bergstrom’s Supplemental Responses to TGHPL’s Interrogatories, Set One, Nos. 2-4, 8,
8 and 14 both seek sanctions for attorney’s fees in the amount of $3,100.00 per motion. (ECF
9 No. 228-2 at 3 and 229-2 at 3.)
10 For the reasons stated on the record at the May 12, 2023 Discovery Hearing, TGHPL
11 Motion to Compel NES’ Supplemental Responses to TGHPL’s Interrogatories, Set One,
12 Nos. 2-4, 8, and 14 and TGHPL’s Motions to Compel Robert Bergstrom’s Supplemental
13 Responses to TGHPL’s Interrogatories, Set One, Nos. 1, 3, and 7 and the related sanctions
14 requests are DENIED.
15 The Court finds TGHPL in violation of this district’s Civil Local Rule 26.1(a)’s meet
16 and confer requirements. See CivLR 26.1(a) (“The Court will entertain no motion pursuant
17 to Rules 26 through 37, Fed. R. Civ. P., unless counsel will have previously met and
18 conferred concerning all disputed issues.”) TGHPL did not meet and confer with Defendant
19 Robert Bergstrom and NES’s counsel in good faith prior to the filing of these two motions.
20 (See ECF No. 228 and 229, Exs. 2.) The meet and confer requirement as set out by the
21 local rules obligates the parties to engage in a dynamic good faith process to resolve
22 disputes amongst themselves. Here, TGHPL’s conduct was clearly not aligned with the
23 spirit of the meet and confer obligations. (Id.) TGHPL’s counsel’s emails demanding a
24 meet and confer at the proverbial eleventh hour, after business hours (6:05 p.m. and 6:08
25 p.m.), the day before the deadline to file a motion to compel, was more akin to a ransom
26 demand than a good faith effort to meet and confer to resolve the discovery dispute. (Id.)
27 To expect defendants’ counsel to meaningfully meet and confer, revise their client’s
28 discovery responses, and obtain client verification as to the truthfulness of the revised
1 responses within twenty-four hours is an unreasonable and unworkable standard. There is
2 no manner in which such a meet and confer could reasonably be considered to have been
3 made in good faith.
4 Accordingly, TGHPL Motion to Compel NES’s Supplemental Responses to
5 TGHPL’s Interrogatories, Set One, Nos. 2-4, 8, and 14 and TGHPL’s Motion to Compel
6 Robert Bergstrom’s Supplemental Responses to TGHPL’s Interrogatories, Set One, Nos.
7 1, 3, and 7 are DENIED. Additionally, TGHPL’s requests for sanctions in the amount of
8 $3,100.00 for attorney’s fees and costs related to each motion are also DENIED.
9 Additionally, NES requested $2,310.00 for attorney’s fees and costs incurred in
10 opposing TGHPL’s Motion to Compel NES’ Supplemental Responses to TGHPL’s
11 Interrogatories, Set One, Nos. 2-4, 8, and 14. (ECF No. 253-1 at 3.) The Court also DENIES
12 NES’s request for attorney’s fees and costs in the amount of $2,310.00.
13 f. ECF No. 239 – NES’s Motion to Compel Deposition Topics No. 11, 12,
14 and 13 of SNR’s 30(b)(6) Representative and Request for Sanctions
15 At the May 12, 2023 Discovery Hearing, SNR’s counsel represented that SNR
16 always intended to produce a corporate representative to address NES’s Deposition Topics
17 Nos. 11, 12, and 13. NES’s counsel represented that despite the substantive resolution of
18 this motion to compel (ECF No. 239), NES still sought sanctions in the amount of
19 $3,850.00 for costs related to raising the motion.
20 The Court once again finds the underlying dispute has been resolved yet the Parties
21 failed to provide any indication or notice to the Court, instead leaving the motion on the
22 Court’s docket for two and a half months and continuing to seek sanctions when the dispute
23 is no longer live. This is simply not how discovery should be conducted.
24 As the Parties both agreed NES’s Deposition Topic Nos. 11, 12, and 13 were no
25 longer at issue, NES’s Motion to Compel the Deposition of SNR’s Person Most Qualified
26 (ECF No. 239) is DENIED AS MOOT. The Court further DENIES NES’s sanctions
27 request for attorney’s fees in the amount of $3,850.00.
28 / / /
1 III. BERGSTROM DEFENDANTS’ DEPOSITION TOPICS NUMBER 39,
2 40, 42, 43, AND 45 AS RELATED TO ECF NO. 212
3 As the Court did not issue any rulings on the bench regarding SNR’s Motion for
4 Protective Order to Preclude Deposition Topics No. 39, 40, 42, 43, and 45 Proposed by the
5 Bergstrom Defendants related to the depositions of SNR’s 30(b)(6) Representative (ECF
6 No. 212), the Court now addresses each below.
7 SNR argued each of these topics are irrelevant, overbroad, and unduly burdensome
8 as the deposition notice and topics, as written, potentially encompass years of meetings and
9 “cover nearly every conceivable facet of this litigation”. (ECF No. 212-1 at 12.) SNR
10 argued the Bergstrom Defendants added numerous irrelevant deposition topics which do
11 not relate to any of the claims or defenses at issue. (Id. at 18-19; May 12, 2023 Hrg. Tr. at
12 5-10.) In turn, the Bergstrom Defendants argued the topics are relevant because they all
13 related to SNR’s ability to develop, market, or sell the Salt Creek project between
14 December 2013 to December 2017. (ECF No. 227 at 19-20; May 12, 2023 Hrg. Tr. at 3-
15 5.) The Bergstrom Defendants argued SNR had a limited period to actually develop and
16 sell the Salt Creek project and elected to abandon it, yet now SNR alleges the Bergstrom
17 Defendants’ actions constituted a breach of contract and misappropriation of trade secrets
18 resulting in SNR’s damages. (May 12, 2023 Hrg. Tr. at 4, 11.) At the May 12, 2023
19 Discovery Hearing, the Bergstrom Defendants also argued that the legal standard for such
20 discovery is not relevancy but rather whether the “particular topic or testimony garnered
21 therefrom is reasonably likely to lead to the discovery of admissible evidence and whether
22 it is proportional to the case.” (May 12, 2023 Hrg. Tr., ECF No. 270 at 11:7-11.)
23 As a threshold matter, the Court finds the Bergstrom Defendants’ argument that
24 relevancy is not the standard for discovery to be improper under Federal Rule of Civil
25 Procedure 26(b)(1) (“Rule 26(b)(1)”). At the heart of all discovery is whether the discovery
26 is relevant to the litigation. If it is not relevant, the inquiry ends. Rule 26(b)(1) provides:
27 Unless otherwise limited by court order, the scope of discovery is as follows:
Parties may obtain discovery regarding any nonprivileged matter that is
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1 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
2
amount in controversy, the parties’ relative access to relevant information, the
3 parties’ resources, the importance of the discovery in resolving the issues, and
whether the burden or expense of the proposed discovery outweighs its likely
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benefit. Information within this scope of discovery need not be admissible
5 in evidence to be discoverable.
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Fed. R. Civ. P. 26(b)(1) (emphasis added).
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Further, the Advisory Committee Note to the 2015 Amendment of Rule 26(b)(1)
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makes clear:
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The former provision for discovery of relevant but inadmissible information
10 that appears “reasonably calculated to lead to the discovery of admissible
evidence” is also deleted. The phrase has been used by some, incorrectly, to
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define the scope of discovery. As the Committee Note to the 2000
12 amendments observed, use of the “reasonably calculated” phrase to define the
scope of discovery “might swallow any other limitation on the scope of
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discovery.” The 2000 amendments sought to prevent such misuse by adding
14 the word “Relevant” at the beginning of the sentence, making clear that
“‘relevant’ means within the scope of discovery as defined in this subdivision
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...” The “reasonably calculated” phrase has continued to create problems,
16 however, and is removed by these amendments. It is replaced by the direct
statement that “Information within this scope of discovery need not be
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admissible in evidence to be discoverable.” Discovery of nonprivileged
18 information not admissible in evidence remains available so long as it is
otherwise within the scope of discovery.
19
20 Fed. R. Civ. P. 26(b)(1) Advisory Committee Note 2015 (emphasis added).
21 Turning to the Bergstrom Defendants’ Deposition Topics No. 39, 40, 42, 43, and 45,
22 the Court finds each deposition topic to be irrelevant and disproportional to the claims or
23 defenses of this case.
24 a. Bergstrom Defendants’ Deposition Topic No. 39 and 42
25 Deposition Topic No. 39 seeks a SNR 30(b)(6) witness to testify about: The
26 calculation of Iowa sales tax on wind turbines that SNR and/or Terra-Gen used to submit
27 bids or proposals of any kind, solicited or unsolicited, to Alliant Energy Company related
28 to Salt Creek. (ECF 212 at 18.) Deposition Topic No. 42 seeks a SNR 30(b)(6) witness to
1 testify about: The meeting with Alliant Energy Company in or about July 2016 in Madison,
2 Wisconsin. (ECF 212 at 18.) SNR objected to both topics based on relevancy and
3 burdensomeness.
4 SNR argued that both deposition topics are unrelated to the underlying claims of
5 breach of contract and misappropriation of trade secrets alleged in its Complaint. SNR
6 argued the Iowa sales tax calculations and whether SNR submitted a bid to Alliant Energy
7 has no relevancy to the allegations made against the Bergstrom Defendants. (May 12, 2023
8 Hrg. Tr. at 5.) SNR represented that the claims underlying this case entail the Bergstrom
9 Defendants’ possession and use of SNR’s data to improperly develop the Salt Creek
10 project. (Id.) SNR represented that their client did not abandon the Salt Creek project and
11 has not contended that they are presently attempting to develop the project. (Id.) Finally,
12 SNR argued the APA specifies that abandonment of any project must occur via a signed
13 writing – yet the Bergstrom Defendants and NES instead rely on circumstantial evidence
14 to argue abandonment and have not provided any concrete explanation for why calculations
15 of the Iowa sales tax or July 2016 meeting are relevant. (Id. at 7.)
16 The Court finds the Bergstrom Defendants have not made a sufficient showing that
17 the calculation of the Iowa sales tax and the July 2016 meeting with Alliant relates to SNR’s
18 allegations against the Bergstrom Defendants and the underlying disputes involving the
19 alleged breach of the APA. Accordingly, the Court SUSTAINS SNR’s objections of
20 relevancy and burdensomeness to the Bergstrom Defendants’ Deposition Topics No. 39
21 and 42.
22 SNR’s Motion for Protective Order Precluding Deposition Topic No. 39 and 42 is
23 GRANTED. SNR need not produce a 30(b)(6) witness for these two deposition topics.
24 b. Bergstrom Defendants’ Deposition Topic No. 40
25 Deposition Topic No. 40 seeks a SNR 30(b)(6) witness to testify about: The selection
26 of Energy Resource Interconnection Service (ERIS) rather than Network Resource
27 Interconnection Service (NRIS) with MISO for Salt Creek. SNR objected to this topic
28 based on relevancy and burdensomeness. The Bergstrom Defendants argued this was not
1 an insignificant decision, resulting in a $25 million uptick in costs for the Salt Creek
2 project, directly impacting SNR or Terra-Gen’s ability to sell the project. (May 12, 2023
3 Hrg. Tr. at 18.) In turn, SNR argued the basis for this topic and many of the Bergstrom
4 Defendants’ arguments are centered on the marketability of the Salt Creek Project. (Id. at
5 8.) SNR represented it already agreed to produce a 30(b)(6) witness on the topic of
6 marketability of the Salt Creek wind farm between 2015 and 2018 (Deposition Topic No.
7 44). (Id. at 8.)
8 Based upon SNR’s representations and the Bergstrom Defendant’s insufficient
9 showing of relevancy and proportionality, the Court SUSTAINS SNR’s objections of
10 relevancy and burdensomeness to the Bergstrom Defendants’ Deposition Topics No. 40.
11 SNR’s Motion for Protective Order Precluding Deposition Topic No. 40 is
12 GRANTED. SNR need not produce a 30(b)(6) witness for this deposition topic.
13 c. Bergstrom Defendants’ Deposition Topic No. 43
14 Deposition Topic No. 43 seeks a SNR 30(b)(6) witness to testify about: Terra-Gen’s
15 decision to reduce energy development efforts in Iowa between 2015 and 2019. (ECF 212
16 at 19.) SNR objected to this topic on the basis of relevancy and burdensomeness. SNR
17 argued the Bergstrom Defendants have already had an opportunity to depose Dan
18 Thompson, head of Midwestern Development, about this very topic. (May 12, 2023 Hrg.
19 Tr. at 7.) SNR represented that Mr. Thompson testified he was not aware of any
20 institutional decision to not develop in Iowa during this time frame. (Id.) SNR argued
21 relevancy may have been different had the topic been narrowed and specified to the
22 Bergstrom Defendants’ argument about abandoning the Salt Creek project, but the topic is
23 ambiguous as written. (Id.) The Bergstrom Defendants countered that Iowa is one of the
24 two states mentioned in the APA, thus the topic was not limited to just the Salt Creek
25 project. (May 12, 2023 Hrg. Tr. at 11.)
26 The Court finds the Bergstrom Defendants have not made a sufficient showing to
27 demonstrate the relevancy of this deposition topic. The Bergstrom Defendants presented
28 no evidence to counter SNR’s representations that this topic has already been addressed by
1 another corporate representative of SNR. They also failed to adequately address why this
2 topic is relevant to the underlying claims at issue.
3 Accordingly, the Court SUSTAINS SNR’s objections of relevancy and
4 burdensomeness to the Bergstrom Defendants’ Deposition Topics No. 43 and SNR’s
5 Motion for Protective Order Precluding Deposition Topic No. 43 is GRANTED. SNR need
6 not produce a 30(b)(6) witness for this deposition topic.
7 d. Bergstrom Defendants’ Deposition Topic No. 45
8 Deposition Topic No. 45 seeks a SNR 30(b)(6) witness to testify about: The impact
9 of Terra-Gen’s decision to intervene in Alliant Energy Company’s case before the Iowa
10 Utilities Board RUP-2016-0005. (ECF 212 at 18.) SNR’s objected to this topic on the basis
11 of relevancy, calls for legal conclusions, and attorney-client privilege. SNR argued the
12 Iowa rate case did not relate to any of the core issues or claims alleged by SNR and that
13 every factual occurrence related to the Salt Creek project does not necessarily involve or
14 relate to the underlying suit between SNR and the Bergstrom Defendants. (May 12, 2023
15 Hrg. Tr. at 9.) SNR further argued that Terra-Gen’s decision to intervene in Alliant
16 Energy’s rate case is deeply intertwined with attorney-client privilege as Mr. Bergstrom
17 and Mr. Hoyle consulted with and retained counsel to make the decision. (Id. at 10.) In
18 response, the Bergstrom Defendants contended abandonment is a defense to a breach of
19 contract claim and the decision to intervene in Alliant Energy’s rate case is one of many
20 steps SNR took leading up to the abandonment of the Salt Creek project. (Id. at 10-11.)
21 The Bergstrom Defendants also represented that to the extent the request potentially
22 implicates attorney-client privileged information, they would not request the witness to
23 answer those questions. (Id. at 17.)
24 Upon review of the deposition topic and the Parties’ arguments, the Court does not
25 find that the Bergstrom Defendants have sufficiently demonstrated relevancy. Although
26 the Bergstrom Defendants argue the topic relates to the ultimate marketability of the Salt
27 Creek project, they did not tie in how this topic relates to SNR’s underlying claims of
28 breach of contract for the APA. Further, based upon SNR’s representation that SNR has
1 already agreed to produce a 30(b)(6) witness for Deposition Topic No. 44, the marketability
2 of the Salt Creek wind farm between 2015 and 2018, the Court is unable to determine how
3 Deposition Topic No. 45 continues to be relevant or proportional to the needs of this case.
4 Accordingly, the Court SUSTAINS SNR’s objections of relevancy, legal
5 conclusions, and attorney-client privilege and SNR’s Motion for Protective Order
6 Precluding Deposition Topic No. 45 is GRANTED. SNR need not produce a 30(b)(6)
7 witness for this deposition topic.
8 IV. SANCTIONS
9 Inherent in Federal Rule of Civil Procedure 26 (“Rule 26”), which governs
10 discovery, is the expectation that counsel and parties will engage in meaningful good faith
11 efforts to obtain and conduct discovery in an expeditious manner. The interplay between
12 meaningful, good faith efforts to obtain and conduct discovery and the potential for
13 discovery abuse and unnecessary gamesmanship has been contemplated and addressed
14 multiple times by the drafters of the Federal Rules. For instance, the Advisory Committee
15 Notes to the 1983 Amendment to Rule 26 states:
16 The purpose of discovery is to provide a mechanism for making relevant
information available to the litigants. ‘Mutual knowledge of all the relevant
17
facts gathered by both parties is essential to proper litigation.’ Hickman v.
18 Taylor, 329 U.S. 495, 507 (1947). Thus the spirit of the rules is violated when
advocates attempt to use discovery tools as tactical weapons rather than to
19
expose the facts and illuminate the issues by overuse of discovery or
20 unnecessary use of defensive weapons or evasive responses. All of this
results in excessively costly and time-consuming activities that are
21
disproportionate to the nature of the case, the amount involved, or the
22 issues or values at stake.
23
Fed. R. Civ. P. 26(b)(1) Advisory Committee Note 1983 (emphasis added).
24
This concept of limiting unduly burdensome discovery and minimizing excessively
25
costly and time-consuming discovery is further espoused in the 2015 Advisory Committee
26
Notes to the 2015 Amendment:
27
Most of what now appears in Rule 26(b)(2)(C)(iii) was first adopted in 1983.
28 The 1983 provision was explicitly adopted as part of the scope of discovery
1 defined by Rule 26(b)(1). Rule 26(b)(1) directed the court to limit the
frequency or extent of use of discovery if it determined that “the discovery is
2
unduly burdensome or expensive, taking into account the needs of the case,
3 the amount in controversy, limitations on the parties’ resources, and the
importance of the issues at stake in the litigation.” At the same time, Rule
4
26(g) was added. Rule 26(g) provided that signing a discovery request,
5 response, or objection certified that the request, response, or objection was
“not unreasonable or unduly burdensome or expensive, given the needs of the
6
case, the discovery already had in the case, the amount in controversy, and the
7 importance of the issues at stake in the litigation.” The parties thus shared the
responsibility to honor these limits on the scope of discovery.
8
9 Fed. R. Civ. P. 26(b)(1) Advisory Committee Note 2015.
10 The 2015 Advisory Committee Notes further state: “The parties and the court have
11 a collective responsibility to consider the proportionality of all discovery and consider it in
12 resolving discovery disputes.” Id.
13 Yet, the concepts of collaboration and compromise inherent in Rule 26 have not
14 translated well to the conduct of the Parties in this case. As stated on the record, monetary
15 sanctions requested and awarded thus far in this case have seemingly fallen upon deaf ears
16 and hearts resulting in a zero-sum gain with monetary sanctions flowing in both directions.
17 Consequently, no party really felt the financial string of being sanctioned. At the December
18 5, 2022, hearing before Judge Schopler, the Parties were admonished they had been “well
19 aware of the warning shot that [Judge Schopler] sent across the bow. … and going forward,
20 the Court would not be inclined to further reduce any sanctions. The party resisting
21 reasonable discovery attempts should expect to bear the full force of any sanctions that
22 come from that behavior.” (ECF No. 191, Dec. 5, 2023 Hrg. Tr. at 77.) Despite this
23 admonishment, the Parties have continued to engage in meaningless discovery
24 gamesmanship which has only further delayed this case. As evidenced by the Parties’
25 continued requests for sanctions despite resolution of the underlying dispute and their
26 ability to resolve a dispute within ten minutes of in-person meet and conferring, all sides
27 have disregarded the spirit of cooperation espoused in the Federal Rules of Civil Procedure
28 and have taken to the Court for every minuscule discovery disagreement.
1 Everyone – the Court, the attorneys, and the parties – are all charged with
2 the responsibility to engage in civil discovery practices that are meant to achieve “the just,
3 speedy, and inexpensive determination of every action and proceeding.” Fed. R. Civ. P. 1.
4 “Effective advocacy is consistent with – and indeed depends upon – cooperation and
5 proportional use of procedure.” Fed. R. Civ. P. 1, 2015 Advisory Committee Notes. This
6 Court’s chambers rules also espouse a concept common amongst the courts: the Court is
7 not a discovery dispute hotline to be called every time the parties have a disagreement and
8 have not put in the effort to resolve it on their own. J. Gallo Civ. Chambers R. IV(G).
9 Given this case’s protracted discovery history, rippled with gamesmanship in which
10 all Parties are guilty, and for the reasons stated by the Court on the record, the Court sua
11 sponte issued sanctions against all parties at the May 12, 2023 Discovery Hearing. The
12 Court’s sanctions required all counsel and client representatives with settlement authority
13 present at the hearing to work together to compose a 1,000-word, handwritten essay
14 detailing the merits and importance of cooperation, compromise, and how it could be
15 achieved in this case moving forward. All counsel and client representatives were required
16 to sign the essay. The Parties were not allowed to use any technology to aid their essay
17 writing efforts and were not permitted to vacate the court until the essay was submitted and
18 approved by the Court. A copy of the Parties’ essay is attached to this order as Exhibit A.
19 V. AMENDED RULES FOR RAISING DISCOVERY DISPUTES
20 Finally, in light of the abysmal discovery conduct which has thus far occurred, the
21 Court, for this case only, amends section IV of its Civil Chamber Rules setting forth the
22 procedures for raising discovery disputes in this case.
23 a. Before the Parties jointly call Judge Gallo’s chambers to raise a dispute,
24 the Parties shall:
25 i. Meet and confer in good faith, via Zoom videoconference. The
26 entire meet and confer shall be recorded.
27 ii. Transmit the videorecording of the Parties’ meet and confer to Judge
28 Gallo’s Chambers in advance of raising the discovery dispute. The
1 videorecording shall be transmitted to Judge Gallo’s Chambers via
2 electronic mail addressed to efile_Gallo@casd.uscourts.gov, or
3 delivered to Judge Gallo’s Chambers on a usb or compact disc.
4 b. If upon review of the Parties’ meet and confer recording it becomes
5 apparent the Parties have not engaged in their best efforts to legitimately
6 meet and confer in good faith, the Court will not entertain the dispute.
7 c. If upon review of the Parties’ meet and confer recording, the Parties have
8 engaged in meaningful meet and confer and a dispute legitimately remains,
9 all discovery dispute hearings will be held in person.
10 i. All counsel and clients with settlement authority shall appear in
11 person at the discovery dispute conference.
12 ii. The prevailing party will be awarded all fees and costs for time
13 incurred as a result of the Court’s intervention in the discovery
14 disputes.
15 These new discovery dispute guidelines do not abridge the current deadlines set forth
16 in Judge Gallo’s Civil Rule IV. The Court reserves its authority to issue further sanctions
17 under Rule 37 should such abysmal discovery conduct continue to ensue. IT IS SO
18 ORDERED.
19 VI. CONCLUSION
20 a. ECF No. 207
21 NES’s Motion for Protective Order to Prevent the Compulsion of NES’s Responses
22 to Randy Hoyle’s Special Interrogatories, Set Two, Nos. 10-19 and TGHPL’s Special
23 Interrogatories, Set Two, Nos. 18-20 is DENIED AS MOOT. NES’ request for sanctions
24 in the amount of $1,050.00 is also DENIED.
25 b. ECF No. 212
26 SNR’s Motion for Protective Order to Preclude the Deposition of James Pagano
27 (ECF No. 212) is DENIED AS MOOT.
28 SNR’s Motion for Protective Order to Preclude Deposition Topics No. 5, 6, and 16
1 ||Proposed by NES Related to the Deposition of SNR’s 30(b)(6) Representative is
2 || GRANTED IN PART and DENIED IN PART.
3 SNR’s Motion for Protective Order to Preclude Deposition Topics No. 6, 7, 8, 13,
4 || and 33 Proposed by the Bergstrom Defendants Related to the Deposition of SNR’s 30(b)(6)
5 || Representative is DENIED IN PART and GRANTED IN PART.
6 SNR’s Motion for Protective Order to Preclude Deposition Topics No. 39, 40,42,
7 ||43, and 45 Proposed by the Bergstrom Defendants Related to the Deposition of SNR’s
8 ||30(b)(6) Representative is GRANTED.
9 c. ECF No. 228
10 TGHPL Motion to Compel NES’ Supplemental Responses to TGHPL’s
11 || Interrogatories, Set One, Nos. 2-4, 8, and 14 is DENIED. TGHPL’s requests for sanctions
12 |/in the amount of $3,100.00 is also DENIED.
13 NES’s request for sanctions in the amount of $2,310.00 is also DENIED.
14 d. ECF No. 229
15 TGHPL’s Motion to Compel Robert Bergstrom’s Supplemental Responses to
16 || TGHPL’s Interrogatories, Set One, Nos. 1, 3, and 7 is DENIED. TGHPL’s requests for
17 || sanctions in the amount of $3,100.00 is also DENIED.
18 e. ECF No. 239
19 NES’s Motion to Compel Deposition Topics No. 11, 12, and 13 of SNR’s 30(b)(6)
20 || Representative and Request for Sanctions is DENIED AS MOOT. NES’s request for
21 sanctions in the amount of $3,850.00 is DENIED.
22 The Parties shall abide by the Court’s new rules for raising future discovery disputes.
23 Court encourages the Parties to meaningfully engage in good faith meet and confer
24 || efforts as the case proceeds.
25 IT IS SO ORDERED.
26 || DATED: June 2, 2023 | A | Se
27 Hon. William V. Gallo
28 United States Magistrate Judge