Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_04-cv-06456/USCOURTS-caed-1_04-cv-06456-6/pdf.json

Nature of Suit Code: 370
Nature of Suit: Other Fraud
Cause of Action: 28:2201 Declaratory Judgement (Insurance)

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

AMCO Insurance Company, )

 )

Plaintiff, )

)

v. )

)

MADERA QUALITY NUT LLC, et )

al., )

)

 Defendants. )

______________________________)

)

MADERA QUALITY NUT LLC, et )

al., )

 )

 Counter-Claimants, )

 )

v. )

 )

AMCO INSURANCE COMPANY, )

 )

 Counter-Defendant. )

 )

1:04-cv-06456-SMS

ORDER DENYING IN PART AND

GRANTING IN PART THE MOTION OF

AMCO TO COMPEL PAYMENT OF EXPERT

WITNESS FEES (DOC. 116)

ORDER GRANTING IN PART AND

DENYING IN PART THE MOTION OF

AMCO TO EXCLUDE TESTIMONY OF

EXPERTS (DOCS. 103, 106)

ORDER DIRECTING THE PARTIES TO

FILE ADDITIONAL SUBMISSIONS

REGARDING MQN’S MOTION TO COMPEL

PRODUCTION OF DOCUMENTS, (DOC.

105)

Additional evidentiary

 materials:

Due on or before 

August 15, 2006

Responsive materials:

Fifteen days after service 

The motions of Plaintiff and Counter-defendant AMCO

Insurance Company (AMCO) to compel payment of expert witness fees

and to exclude expert testimony, and the motion of Defendant and

Counter-claimant Madera Quality Nut, Inc. (MQN) to compel further

production of documents came on regularly for hearing on July 27,

2006, at 10:00 a.m. in Courtroom 7 before the Honorable Sandra M.

Snyder, United States Magistrate Judge. Julian J. Pardini of

Case 1:04-cv-06456-SMS Document 139 Filed 07/31/06 Page 1 of 6
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Lewis Brisbois Bisgaard & Smith, and Gordon M. Park and Mohammed

S. Mandegary of McCormick, Barstow, Sheppard Wayte & Carruth

appeared on behalf of Plaintiff AMCO; Arturo Gonzalez of Morrison

& Foerster and Jeffrey P. Davis of Dowling Aaron & Keeler

appeared on behalf of Defendants. After argument the matters were

submitted to the Court, which had considered all joint

stipulations and other papers submitted in connection with the

motions. The matters relating to joinder have previously been

considered and ruled upon by the Court, which granted joinder.

I. AMCO’S MOTION TO COMPEL PAYMENT OF EXPERT WITNESS FEES

AMCO seeks an order pursuant to Fed. R. Civ. P. 26(b)(4)(C),

which requires that unless manifest injustice would result, the

Court “shall require” a party seeking to depose an identified or

retained expert a reasonable fee for time spent in responding to

discovery, and with respect to a retained expert who is not

expected to be called as a witness at trial, a fair portion of

the fees and expenses reasonably incurred by the responding party

in obtaining facts and opinions from the expert. AMCO seeks an

order with respect to the preparation, travel, and deposition

time of Susan Thompson and Stephen Schroeder, two accountants who

are both percipient and expert witnesses in this action. AMCO’s

motion and accompanying authorities, declarations, and exhibits,

as well as its reply, in addition to MQN’s opposition,

objections, and declarations, have been reviewed by the Court.

AMCO relies on Fisher-Price, Inc. v. Safety 1 , Inc., 217 st

F.R.D. 329 (D.Del. 2003), in which it was found that requiring

the plaintiff to pay the fees of defendant’s expert witness for

time spent attempting to comply with the plaintiff’s document

Case 1:04-cv-06456-SMS Document 139 Filed 07/31/06 Page 2 of 6
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request would not create a manifest injustice. The instant case

differs from Fisher-Price in that after considering the parties’

papers and weighing the hardships imposed on the respective

parties and balancing the need for doing justice on the merits

against the need for maintaining orderly and efficient procedural

arrangements, the Court concludes that it would create a manifest

injustice to require MQN to pay for AMCO’s experts’ past or

future time in preparing for such discovery, including searching

for documents that are voluminous. This finding is based on the

nature and extent of the involvement of the experts (Thompson and

Schroeder) as percipient witnesses, the nature and extent of

their expert contributions and the extent to which they have

already been compensated, the course and scope of discovery

preceding the upcoming depositions, and the lack of evidentiary

support for the claim regarding the amount of time taken by

Thompson and her staff in responding to document requests. 

Accordingly, the Court DENIES AMCO’s motion to compel

payment of expert witness fees except that, as is the case with

both parties, MQN shall be required to pay the experts’ usual

expenses of actual deposition time and necessary travel. 

II. AMCO’s Motion to Exclude Expert Witnesses’ Testimony

AMCO moves to exclude Defendants’ expert witnesses,

including their designation, reports, and testimony because of

untimely designation.

The Court has reviewed the parties’s submissions relating to

this motion, including the motion, memorandum, declaration and

attachments; the opposition and supporting declarations; and the

reply and supporting papers. Counsel for Defendants and CounterCase 1:04-cv-06456-SMS Document 139 Filed 07/31/06 Page 3 of 6
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claimants has represented as an officer of the Court that the two

witnesses designated by it as retained experts are solely

rebuttal witnesses, and that should AMCO not introduce expert

testimony as disclosed by its timely disclosures, then Defendants

will not produce these witnesses.

Because of the wording of this Court’s order of February 28,

2005, concerning the direction to disclose all expert witnesses

and supplemental expert witnesses, no order of the Court

expressly governed the disclosure of rebuttal expert witnesses.

The disclosure of such witnesses is thus governed by Fed. R. Civ.

P. 26(a)(2)(C), and thus the Court does not find untimely the

disclosure of witnesses Frank Zeigon to rebut the expert opinions

already rendered and reported by AMCO’s designated expert

Veentra; and of Jerry Randall, to rebut the expert opinions

already rendered and reported by AMCO’s designated expert

Thompson. The Court emphasizes that such rebutting expert

evidence is limited to evidence intended solely to contradict or

rebut the previously disclosed evidence on the same subject

matter. Fed. R. Civ. P. 26(a)(2)(C). 

AMCO’s motion to exclude the designation, reports, and

testimony of these two witnesses IS DENIED; these two expert

witnesses will be permitted to be designated and to report and

testify solely to contradict or rebut evidence of the opinions

already rendered and reported as described hereinabove; any other

testimony or evidence of these experts will be excluded.

III. MQN’s Motion to Compel Production of Documents

MQN moves to compel further production of documents,

consisting essentially of post-litigation Passport notes and eCase 1:04-cv-06456-SMS Document 139 Filed 07/31/06 Page 4 of 6
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mails. AMCO claims attorney-client privilege (privilege) and work

product protection. The Court has considered all the papers

submitted by the parties, which include privilege logs from AMCO.

A court has inherent power to control its docket and the

disposition of its cases with economy of time and effort for both

the court and the parties. Landis v. North American Co., 299 U.S.

248, 254-255 (1936); Ferdik v. Bonzelet, 963 F.2d 1258, 1260 (9th

Cir. 1992). The Court finds the compilation of materials

submitted by AMCO in connection with establishing a foundation or

basis for either the privilege or the protection not to be

organized in a helpful fashion. Further, in the interest of the

importance of preserving privileges and in furtherance of the

Court’s desire to be fully informed before undertaking to rule on

this motion, the Court exercises its discretion to permit AMCO to

submit no later than fifteen days after the date of service of

this order additional evidentiary materials, and authority if

desired, to establish a basis for either attorney-client

privilege with respect to assertedly privileged communications,

or work product protection with respect to communications and any

other materials included in those sought by this motion, and

further to provide a helpful privilege log focused on only the

matters that are sought by this motion. As it stands, the Court

does not understand the precise post-litigation function of the

Passport system, the identities of various AMCO personnel and

their duties in connection with litigation activities, and the

degree of oversight, direction, or other connection between the

persons using Passport and AMCO’s counsel who are involved in the

litigation. The Court extends this opportunity in order to be

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fully informed and to be able to make reasoned decisions with

respect to the privilege and the protection. The general legal

principles governing the attorney-client privilege and the work

product protection in this action have been previously set forth

in the Court’s order of April 11, 2006.

MQN may file responsive additional evidentiary materials and

authority no later than fifteen days after the date of service of

any supplemental materials filed by AMCO in response to this

order. 

Thereafter, absent further order of the Court, the matter

will be deemed submitted to the Court for decision.

IT IS SO ORDERED.

Dated: July 31, 2006 /s/ Sandra M. Snyder 

icido3 UNITED STATES MAGISTRATE JUDGE

Case 1:04-cv-06456-SMS Document 139 Filed 07/31/06 Page 6 of 6