Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_13-cv-05001/USCOURTS-cand-3_13-cv-05001-29/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:1132 E.R.I.S.A.: Employee Benefits

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

DAVID SLACK, et al.,

Plaintiffs,

v.

RUSSELL E. BURNS, et al.,

Defendants.

Case No. 13-cv-05001-EMC (KAW)

ORDER DENYING DEFENDANTS' 

JOINT ADMINISTRATIVE MOTION 

TO TAKE THE DEPOSITION OF 

DEBBIE S. MORGAN

Re: Dkt. No. 340

On August 15, 2016, Defendants filed a joint administrative motion to take the deposition 

of Debbie S. Morgan in connection with Defendants’ motion for attorneys’ fees. 

Upon review of the moving papers, the Court deems this matter suitable for disposition 

without oral argument pursuant to Civil L.R. 7-1(b), and DENIES Defendants’ administrative 

motion to take Ms. Morgan’s deposition.

I. BACKGROUND

In December 2014, Debbie Shank Morgan pled guilty to one count of obstruction of justice 

for fabricating physical evidence and providing false information to a federal agent in an attempt 

to frame an International Union Operating Engineer (“IUOE”) official for embezzlement of $30 

million from a union political action committee. She was sentenced to six months in a federal 

correctional facility, six months under house arrest, placed on supervised release for three years, 

ordered to undergo mental health counseling, and given debt restrictions and assessed fines 

totaling $5,000. Currently, Morgan has been released from the federal correctional facility and is 

under the supervision of the U.S. Probation Office in Cleveland, Ohio.

The undersigned granted a prior request to take Morgan’s deposition in November 2015. 

(Dkt. No. 246.) Morgan’s various health conditions, however, resulted in her deposition not going 

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forward due to medical unavailability. (See Dkt. No. 332.) On July 20, 2016, the district court 

granted Defendants’ motion for summary judgment. Thereafter, judgment was entered against 

Plaintiffs, which has been appealed.

On August 15, 2016, Defendants filed an administrative motion to take Morgan’s 

deposition in connection with their motion for attorneys’ fees. (Defs.’ Mot., Dkt. No. 340.) On 

August 18, 2016, Plaintiffs filed a response. (Pls.’ Opp’n, Dkt. No. 341.)

II. LEGAL STANDARD

Under Federal Rule of Civil Procedure 26, parties may obtain “discovery regarding any 

non-privileged matter that is relevant to any party’s claim or defense and proportional to the needs 

of the case . . . .” Fed. R. Civ. P. 26(b)(1). Whether to grant or deny discovery requests in 

connection with an attorney’s fee motion is within the discretion of the district court. Sablan v. 

Dep’t of Fin. of Com. of N. Mariana Islands, 856 F.2d 1317, 1321 (9th Cir. 1988). The court has 

discretion to award “a reasonable attorney’s fee and costs of action to either party.” 29 U.S.C.A. § 

1132(g)(1). In deciding whether to award discretionary attorney’s fees and costs is an ERISA 

action, the court employs the five factors set out in Hummell v. S. E. Rykoff & Co.:

(1) the degree of the opposing parties' culpability or bad faith; (2) 

the ability of the opposing parties to satisfy an award of fees; (3) 

whether an award of fees against the opposing parties would deter 

others from acting under similar circumstances; (4) whether the 

parties requesting fees sought to benefit all participants and 

beneficiaries of an ERISA plan or to resolve a significant legal 

question regarding ERISA; and (5) the relative merits of the parties' 

positions.

634 F.2d 446, 453 (9th Cir. 1980). When applied, the Hummell factors “confront the ‘nuclei of 

concerns’ relevant to ERISA lawsuits.” Eddy v. Colonial Life Ins. Co. of Am., 59 F.3d 201, 206 

(D.C. Cir. 1995)(quoting Iron Workers Local No. 272 v. Bowen, 624 F.2d 1255, 1266 (5th Cir. 

1980)). A recipient of attorney’s fees under § 1132(g)(1) does not need to be a “prevailing party.”

Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 243(2010).

III. DISCUSSION

Defendants request leave to take Morgan’s deposition in connection with their motion for 

attorney’s fees on the grounds that she possesses critical, non-privileged information to prove that 

Plaintiffs acted in bad faith in their prosecution of this action, including information and/or 

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documents obtained from current or former trustees of the Operating Engineers Pension Trust, 

information from various witnesses and information that could support Defendants’ affirmative 

defenses, or may contradict allegations made by Plaintiffs’ counsel in this action.

A. Hummell Factors

There is no dispute that the court has the discretion to permit post-judgment discovery. 

Thus, the Court will analyze the applicable Hummell factors to determine whether Morgan’s 

testimony is relevant to one or more Hummell factors. In support of their motion, Defendants 

contend that Morgan’s testimony is highly relevant to determine the degree of Plaintiffs’ and their 

counsel’s culpability and bad faith in bringing the action, and whether an award of fees would 

deter others from acting under similar circumstances. (Defs.’ Mot. at 4.)

i. Bad Faith

The first Hummel factor concerns an evaluation of the opposing party’s conduct to 

determine the degree of culpability or bad faith. While bad faith is not required, it generally 

justifies an award of attorneys’ fees. Smith v. CMTA-IAM Pension Trust, 746 F.2d 587, 590 (9th 

Cir. 1984).

Here, Defendants contend that evidence demonstrates that Plaintiffs and their counsel have

made “unsupported claims against numerous entities and individuals in this action,” which 

constitutes bad faith. (Defs.’ Mot. at 4). At the time the present action was filed, Plaintiffs’ 

counsel had two pending lawsuits—Salas and Pette—against IUOE-affiliated entities. (Defs.’ 

Mot. at 4.) Thus, Defendants believe that Plaintiffs’ counsel and Morgan participated in an 

unsuccessful litigation scheme to target IUOE entities and its affiliates. Id. In addition, court 

records show that leading up to Morgan’s date of incarceration , Plaintiffs’ counsel utilized 

Morgan in some capacity because she was “granted work-related travel to California, Hawaii, 

Nevada, and Utah, all areas within the jurisdiction of IUOE, Local 3 (the union local central to this 

action).” (Defs.’ Mot. at 5). To date, Defendants have been unable to question Morgan about her 

involvement and communications with Plaintiffs’ counsel due to objections of privilege. Id. 

In opposition, Plaintiffs argue that Defendants’ inference that the other cases qualify as an 

unsuccessful litigation scheme is unfounded given the fact that Plaintiffs’ counsel has obtained 

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positive results. (Pls.’ Opp’n at 3.) For instance, the filing of the Salas action “led directly to 

reimbursement to several trust funds and Defendants admitted numerous allegations in their 

[a]nswers.” (Pls.’ Opp’n. at 3). Furthermore, after Pette was filed, “the local union sued a major 

employer to recover unpaid trust contributions that plaintiffs identified in their complaint.” (Pls.’ 

Opp’n. at 3). Therefore, the filing of those lawsuits alone does not demonstrate bad faith. 

The undersigned declines to speculate as to whether Morgan’s deposition would uncover 

evidence to support the theory that the case was filed in bad faith. Indeed, the fact that Morgan 

remained employed by Plaintiffs’ counsel while her criminal matter was pending does not, without 

more, demonstrate bad faith. Moreover, two similar lawsuits are not a scheme. The Court further 

notes that any information sought regarding communications between Morgan, as a paralegal, and 

Plaintiffs’ counsel that occurred during her employ would likely be privileged. Notwithstanding, 

this factor weighs slightly in favor of permitting Defendants to depose Morgan in connection with 

their motion for attorney’s fees.

ii. Deterrence

The third Hummell factor pertains to whether an award of fees would deter others from 

acting under similar circumstances. “[T]he district court must consider whether the award of fees 

will likely deter not only similar future ERISA violations but also delayed or otherwise inadequate 

detection and resolution of such violations.” Eddy, 59 F.3d at 207. The purpose of this deterrence 

factor is “to protect the interests of plan participants and their beneficiaries.” Id.

Here, Defendants argue that a fee award would serve as a deterrent because, at the time of 

filing, Plaintiffs’ counsel had “several” other suits pending against IUOE-affiliated entities and 

personnel. (Defs.’ Mot. at 4). These lawsuits shared similar characteristics, such as being lengthy 

complaints against IUOE entities and affiliates, which indicated that this was becoming a pattern 

for Plaintiffs’ counsel. (Defs.’ Mot. at 5). Defendants believe that Morgan’s deposition will bring 

to light many of the unsupported claims behind the targeted attack on the IUOE entities and 

affiliates and would be used to “deter such future actions and safeguard plans from expending 

resources defending unfounded allegations.” Id.

In opposition, Plaintiffs contend that Defendants’ representation that the claims were 

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without merit is baseless. For example, one of the claims that Plaintiffs brought led to 

“reimbursements to several trust funds, and defendants admitt[ing] numerous allegations in their 

[a]nswers.” (Pls.’ Opp’n. at 3). Furthermore, Plaintiffs argue that Defendants’ “fishing 

expedition” will not justify a deviation from barring discovery into dismissed claims under Rule 

26(b)(1).

Three lawsuits are not “several,” and the positive results obtained by Plaintiffs in two of 

them refute the existence of a “litigation scheme.” Therefore, the court does not believe that an 

award of attorney’s fees in this instance would serve as a deterrent, as Plaintiffs obtained some of 

the relief sought in the other cases, thereby rendering the deposition unnecessary.

iii. Other factors

Plaintiffs point out that Defendants do not address nor claim that they are able to satisfy 

the three remaining Hummell factors: the ability to pay, that Defendants were acting to benefit all 

participants, and the relative merits of the parties’ positions. (Pls.’ Opp’n at 2.) Defendants, 

however, need not satisfy all five factors. Paddack v. Morris, 783 F.2d 844, 846 (9th Cir. 1986) 

(“None of the Hummell factors is ‘necessarily decisive’; various permutations and combinations 

can support an award of attorney fees.”) 

Notwithstanding, discretionary fees are generally awarded to ERISA participants rather 

than defendant employers or union officials, and “should not be charged against ERISA 

plaintiffs.” See Carpenters S. California Admin. Corp. v. Russell, 726 F.2d 1410, 1416 (9th Cir. 

1984). This is because ERISA “is remedial legislation which should be liberally construed in 

favor of protecting participants in employee benefits plans.” Smith, 746 F.2d at 589.

Defendants, however, are not plan participants. Essentially, the only Hummell factor that 

potentially weighs in favor of permitting the post-judgment deposition of Morgan is the possibility 

that testimony could be elicited to support Defendants’ unsubstantiated claim that Plaintiffs acted 

in bad faith by engaging in a litigation scheme to attack IUOE entities and affiliates statewide. As 

discussed above, a few lawsuits do not constitute a scheme, especially given the favorable results 

obtained by Plaintiffs’ counsel in the cases cited in Defendants’ moving paper. (See Pls.’ Opp’n at 

3.) 

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In considering Rule 26, the Court notes that Morgan’s medical condition would likely 

render any deposition unduly burdensome, if one could even go forward. Thus, the Court finds 

that, in totality, the Hummell factors do not outweigh the burden imposed by taking the postjudgment deposition of Debbie Morgan.

B. Scope of Discovery

Plaintiffs argue that any post-judgment discovery pertaining to fee disputes should be rare 

and narrow. (Pls.’ Opp’n at 4 n. 7.) Plaintiffs, however, cite only to cases involving discovery 

requests pertaining to the amount of reasonable attorneys’ fees, in which one party sought the 

complete billing records of the other party, including information that was determined to 

constitute work product. See ids. As a result, the courts in those cases ordered the disclosure of 

the hours worked and the hourly rates charged. Id.; see Real v. Cont'l Grp., Inc., 116 F.R.D. 211, 

214 (N.D. Cal. 1986)(“[S]imply the number of hours billed, the parties’ fee arrangement, costs and 

total fees paid do not constitute privileged information.”) 

Notwithstanding, given the Court’s finding that the Hummell factors do not outweigh the 

burden of taking Morgan’s deposition, see discussion supra Part III.A.iii, the Court need not 

address the scope of the deposition.

IV. CONCLUSION

In light of the foregoing, the Court DENIES Defendants’ joint motion to take Debbie 

Morgan’s deposition in connection with the motion for attorneys’ fees. 

IT IS SO ORDERED.

Dated: October 7, 2016

__________________________________

KANDIS A. WESTMORE

United States Magistrate Judge

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