Graham v. Ingan et al

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UNITED STATES BANKRUPTCY COURT
CENTRAL DISTRICT OF CALIFORNIA
NORTHERN DIVISION
In re: ) CASE NO. 9:10-bk-10138-RR
)
Edwin Ingel Ingan and Jane ) Chapter 7
Quines Ingan )
) Adv. No. 9:10-ap-01148
Debtors. )
) ORDER DENYING MOTION FOR
) RELIEF FROM ORDER EXCLUDING
Joan Graham, as successor in ) TESTIMONY OF SHEPHERD
interest to Marian Eileen ) ROYLANCE
Kengel, )
) No hearing set
Plaintiffs, )
vs. )
)
Edwin Ingel Ingan and Jane )
Quines Ingan, )
)
Defendants. )
)
The instant Adversary Proceeding, commenced on June 2, 2010,
objects to the discharge of the Debtor/Defendants under 11 U.S.C.
FILED & ENTERED
SEP 10 2012
CLERK U.S. BANKRUPTCY COURT
Central District of California
BY DEPUTY CLERK	rust
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§727. Trial is presently set for September 18 and 19, 2012.
This Order addresses the third motion involving the testimony
of Plaintiff’s expert witness, Shepherd Roylance. On May 7, 2012,
Defendants filed their first motion to exclude the testimony of Mr.
Roylance. The initial motion was denied, finding that Plaintiff’s
disclosure of the identity of her expert witness in March 2012, was
timely under F.R.Civ.P. 26(a)(2)(D). See Order entered May 23,
2012.
Defendants’ second motion to exclude the testimony of Mr.
Roylance followed on July 6, 2012. The second motion was granted,
pursuant to F.R.Civ.P. 26(a)(2)(B) and 37(c)(1), finding that
Plaintiff had failed to timely provide Mr. Roylance’s written expert
report to the Defendants after repeated efforts to obtain such
report by Defendants’ counsel. See Order entered August 9, 2012.
The instant motion filed by Plaintiff on August 16, 2012,
essentially seeks reconsideration of the Court’s August 9, 2012,
Order excluding Mr. Roylance’s testimony.
As with the two prior motions, the Court once again finds the
matter appropriate for consideration without a hearing.
Plaintiff’s motion seeks an “order pursuant to Rule 7060 of the
Federal Rules of Bankruptcy Procedure, vacating and setting aside
the Court’s order . . .” There is no Bankruptcy Rule 7060.
F.R.Civ.P. 60 is made applicable to bankruptcy cases by Bankruptcy
Rule 9024. Under F.R.Civ.P. 60(b), a court may reconsider an
earlier order or judgment upon a showing of (1) mistake,
inadvertence, surprise, or excusable neglect; (2) newly discovered
evidence; (3) fraud, misrepresentation or misconduct by an opposing
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party; (4) a void judgment; (5) a satisfied or discharged judgment;
or (6) any other reason that justifies relief. F.R.Civ.P. 60(b);
School Dist. No. 1J, Multnomah County, Oregon v. ACandS, Inc., 5
F.3d 1255, 1263 (9th Cir. 1993); Fuller v. M.G. Jewelry, 950 F.2d
1437, 1442 (9th Cir. 1991). Additionally, Local Bankruptcy Rule
9013-4 sets forth the grounds for a motion for new trial, a new
hearing, or amendment of a judgment. Such grounds include, but are
not limited to irregularity in the proceedings, abuse of discretion,
accident or surprise, newly discovered material evidence, excessive
or inadequate damages, insufficiency of evidence, and errors of law.
The Court finds that Plaintiff’s motion for reconsideration
lacks merit. No excusable neglect has been demonstrated and no new
facts have been shown.
Plaintiff argues that she did not file opposition to
Defendants’ second motion to exclude Mr. Roylance’s testimony based
on her counsel’s belief that the Court would set a hearing date
prior to ruling. The contention is disingenuous. The Court ruled
on Defendants’ first motion to exclude the testimony without
conducting a hearing, notwithstanding that Defendants’ first motion
was accompanied by a request for hearing and no opposition or
response had been filed. The Court’s Order denying Defendants’
first motion to exclude the testimony was entered 16 days after the
motion was filed, finding the matter appropriate for consideration
without a hearing.
Additionally, more than 30 days passed between the filing of
Defendants’ second motion to exclude the testimony and the Court’s
issuance of its August 9, 2012, Order, giving Plaintiff ample time
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to file opposition, to notify this Court that it had belatedly
produced the required report, to request a hearing, or to seek an
extension of time for submitting the expert witness report.
Instead, Plaintiff elected to take no action. Prior Products, Inc.
v. Southwest Wheel-NCL Co., 805 F.2d 543, 546 (5th Cir. 1986) (“An
attorney has a responsibility to monitor proceedings with some
degree of diligence.”)
Plaintiff attempts to blame the Defendants’ counsel for not
self-calendaring the two prior motions. Contrary to Plaintiff’s
argument, neither the first nor the second of Defendants’ motions to
exclude testimony could be self calendared since the motions did not
fall within the categories specified in the Court’s Self-Calendaring
Instructions posted on the Court’s website. See Self-Calendaring
Instructions for the Honorable Robin L. Riblet, Local Bankruptcy
Rule 9013-1(b).
The events which purportedly caused a delay in delivering Mr.
Roylance’s report to Defendants’ counsel do not constitute newly
discovered evidence. Defendants’ second motion included a letter
from Plaintiff’s counsel, Mr. Nardoni, which stated, “The delay in
sending Mr. Roylance’s report to you has been occasioned by medical
problems in the family of my cocounsel, Mr. Balisok. I expect to
send the report to you early next week.” Thus, the Court was aware
of these facts when it considered the Defendants’ second motion to
exclude the testimony.
While Plaintiff is entitled to have the benefit of counsel of
her choice, co-counsel’s reliance upon Mr. Balisok to review and
approve the required expert report was not reasonable under the
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circumstances. Plaintiff has simultaneously engaged three separate
attorneys from different firms in this adversary proceeding. As
noted above, Mr. Nardoni knew of Mr. Balisok’s unavailability no
later than June 29, 2012, the date of his letter to Mr. Rambuski.
Mr. Balisok’s declaration attests that he was “emotionally and
physically” unable to work while being primary caregiver to his wife
between June 22 and July 5, 2012. Ms. Moore, the third of
Plaintiff’s three attorneys, stated in her declaration that she had
met with Mr. Roylance during the week of June 18, and that the work
needed to complete the expert report “was substantially completed
that week.” Notwithstanding the looming deadline for submitting the
report, Mr. Rambuski’s repeated requests for the report, and the
unavailability of Mr. Balisok, Ms. Moore “forwarded a memorandum to
Mr. Balisok for his review, comment, and approval, before generating
the final report.” Given Plaintiff’s concession that, “The opinions
expressed by Mr. Roylance in his report are substantially the same
as those in the proposed joint pretrial order filed on March 29,
2012,” co-counsel’s reliance upon Mr. Balisok for “necessary and
substantive feedback” during the period of time which Mr. Balisok
was knowingly unable to work was simply not reasonable. Plaintiff’s
counsel’s delay in submitting the expert witness report is
especially egregious given that Plaintiff did not seek an extension
of the deadline for submitting the report from either opposing
counsel or the Court.
Waiting until the week of June 18 to meet with Mr. Roylance to
finalize his expert witness report was not reasonable in the first
instance. As stated in the August 9, 2012, Order of this Court,
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under F.R.Civ.P. 26(a)(2)(B) and (D), the deadline for providing
Plaintiff’s expert report to the Defendants was June 20, 2012. The
governing rules should have been well known to Plaintiff’s counsel
since this Court referenced Rule 26 in denying Defendants’ first
motion to exclude the testimony. “Deadlines are not meant to be
aspirational; counsel must not treat the goodwill of the court as a
sign that, as long as counsel tries to act, he has carte blanche
permission to perform when he desires.” Rucinski v. Torian Plum
Condominium Owners Assoc., Inc., 2010 WL 2985604 *2 (D. Col. 2010),
citing Young v. City of Palm Bay, 358 F.3d 859, 864 (11th Cir.
2004).
Even if Plaintiff’s three attorneys misunderstood the deadline
under Rule 26, they were alerted to the expiration of the deadline
on the following day by Mr. Rambuski’s telephone call to Mr. Nardoni
inquiring about the report. Mr. Nardoni reported of his own illness
and a busy law practice. Written correspondence from Mr. Rambuski
seven days later on June 28, 2012, once again put Plaintiff’s
counsel on notice of the expiration of the deadline for the report
and fairly warned of Mr. Rambuski’s intent to file a motion to
exclude the testimony. These undisputed facts -- waiting until the
eleventh hour to meet with Plaintiff’s expert witness, then further
delaying the report by submitting it to unavailable co-counsel for
comment, and failing to seek an extension of time through opposing
counsel or the Court -- demonstrate nothing less than a complete
disregard for compliance with the applicable rules.
The “new facts” cited in support of her motion for
reconsideration belatedly inform the Court that the written expert
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witness report was tendered on July 9, 2012, three days after
Defendants’ second motion to exclude the testimony was filed.
Unfortunately, Plaintiff’s counsel withheld this important
information from the Court by choosing not to file opposition or to
otherwise notify the Court of the belated compliance. Consequently,
the Court granted Defendants’ second motion on August 9, 2012. “A
motion to reconsider may not be used to present a new legal theory
for the first time or to raise legal arguments which could have been
raised in connection with the original motion.” In re Armstrong
Store Fixtures Corp., 139 B.R. 347, 349 (Bankr. W.D. Pa. 1992),
citing Matter of Sisson, 668 F.Supp. 1196, 1197 (N.D. Ill. 1983)
(emphasis added).
As stated in the Order of August 9, 2012, F.R.Civ.P. 37(c)(1)
provides that a party who fails to provide information or to
identify a witness may be barred from using expert testimony not so
disclosed, unless the failure to disclose was “substantially
justified” or “harmless.” The decision of whether to admit or
exclude evidence lies within the broad discretion of the trial
court. Cantrell v. GAF Corp., 999 F.2d 1007, 1014 (6th Cir. 1993).
The Court must balance fairness to the parties with the need to
manage crowded dockets and consider a multiplicity of pertinent
factors including the history of the litigation, the need for the
challenged evidence, any justifications for the late disclosure, and
the opponent’s ability to overcome its adverse effects. Macaulay v.
Anas, 321 F.3d 45, 51 (1st Cir. 2003).
Plaintiff maintains that no prejudice will result in allowing
Mr. Roylance to testify because Mr. Roylance was made available for
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deposition and because Defendants submitted an expert witness
disclosure of a rebuttal witness. However, as Defendants explain in
their opposition, Mr. Roylance was not made available for deposition
until August 27, 2012, only 22 days before trial. Due to the
anticipated cost for an expedited deposition transcript, the need
for and the expense of a rebuttal expert on very short notice, and
most importantly, due to entry of the Court’s August 9, 2012, Order
excluding Mr. Roylance’s testimony, Defendants elected to take the
deposition off calendar. Should the Court now reconsider and allow
Mr. Roylance to testify, the Defendants will be substantially harmed
through no fault of their own or that of their counsel.
The purpose of Rule 26(a)(2) is to prevent unfair surprise
at trial and to permit the opposing party to prepare
rebuttal reports, to depose the expert, and to prepare for
depositions and cross-examination at trial. The Rule also
prevents experts from “lying in wait” to express new
opinions at the last minute, thereby denying the opposing
party the opportunity to depose the expert on the new
information or closely examine the expert’s new testimony.
“[T]he very purpose of the rule is nullified” when an
expert “supplements” his report by addressing a new matter
after discovery has ended. Rule 37(c)(1) provides for the
exclusion at trial of any information not disclosed
pursuant to Rule 26(a), unless the failure to disclose is
harmless, or if there is substantial justification for
such failure.
Iacangelo v. Georgetown University, 272 F.R.D. 233, 234 (D. D.C.
2011), citing Minebea Co., Ltd. v. Papst, 231 F.R.D. 3, 5-6 (D. D.C.
2005) and Coles v. Perry, 217 F.R.D. 1, 4 (D. D.C. 2003) [internal
citations omitted].
At this late date, with trial scheduled for September 18 and
19, 2012, relief to Plaintiff cannot be afforded without continuing
the trial dates, and forcing the Defendants to incur the costs of
deposing Mr. Roylance and preparing for a rebuttal expert. While
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Plaintiff suggests the Court can readily continue the trial date,
this suggestion is not well taken given the Court’s very congested
trial calendar. The Court set the trial dates for a two-day trial
over five months in advance. A continuance at this late juncture
prevents the Court from otherwise utilizing these valuable two days
of the Court’s limited time for other productive purposes. A
continuance will also work to further delay the Defendants’
entitlement to a fresh start under the Bankruptcy Code. This
adversary proceeding is already 27 months old.
Undeniably, Plaintiff may be harmed by her counsel’s failure to
submit the expert report in a timely fashion. However, “clients
must be held accountable for the acts and omissions of their
attorneys.” Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd., 507
U.S. 380, 396 (1993).
Petitioner voluntarily chose this attorney as his
representative in the action, and he cannot now avoid the
consequences of the acts or omissions of this freely
selected agent. Any other notion would be wholly
inconsistent with our system of representative litigation,
in which each party is deemed bound by the acts of his
lawyer-agent and is considered to have notice of all
facts, notice of which can be charged upon the attorney.
Pioneer Inv. Servs. Co. v. Brunswick Assocs. Ltd., 507 U.S. at 397,
citing Link v. Wabash R.Co., 370 U.S. 626, 633-34 (1962) [internal
quotations and citations omitted].
Moreover, denial of this motion for reconsideration does not
deprive Plaintiff of her right to trial on the merits. While the
May 23, 2012, Order recognized a legitimate need for the challenged
expert evidence, the need for the challenged evidence is but one
factor the Court must consider. The Court must balance fairness to
the parties with the need to manage its crowded docket. It is also
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required to consider the absence of substantial justification for
the late disclosure and Defendants’ inability to overcome the
adverse effects of the tardy disclosure at this late juncture.
Accordingly,
IT IS HEREBY ORDERED that Plaintiff’s motion for relief from
the Order excluding the testimony of Shepherd Roylance is DENIED.
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United States Bankruptcy Judge
DATED: September 10, 2012
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SERVICE LIST FOR ENTERED ORDER
Counsel for Defendants
Edwin J. Rambuski, Esq.
1401 Higuera Street
P.O. Box 12503
San Luis Obispo, CA 93406
Counsel for Plaintiff
Jody Moore, Esq.
1429 E. Thousand Oaks Blvd, Suite 202
Thousand Oaks, CA 91362
Russell Balisok, Esq.
Balisok & Associates
330 No. Brand Blvd, Suite 702
Glendale, CA 91203
Silvio Nardoni, Esq.
535 North Brand Blvd, Suite 501
Glendale, CA 91203
Chapter 7 Trustee
Jerry Namba
504 East Chapel St.
Santa Maria, CA 93454
U.S. Trustee
Office of the U.S. Trustee Region 16
21051 Warner Center Lane, Ste 115
Woodland Hills, CA 91367
Brian Fittipaldi, Esq.
Office of the U.S. Trustee
128 East Carrillo Street
Santa Barbara, CA 93101
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