Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_13-cv-00484/USCOURTS-caed-1_13-cv-00484-7/pdf.json

Nature of Suit Code: 470
Nature of Suit: Civil (Rico)
Cause of Action: 18:1962 Racketeering (RICO) Act

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

JAGJEEVAN K. DHALIWAL, an individual 

and MOHINDER S. GILL, an individual,

Plaintiffs,

v.

NIRMAL SINGH, et al.,

Defendants.

_____________________________________/

Case No. 1:13-cv-00484-LJO-SKO

ORDER ON PLAINTIFFS' MOTION FOR 

EXCLUSIONARY SANCTIONS 

PURSUANT TO RULE 37

ORDER THAT DEFENDANTS 

SUPPLEMENT INITIAL DISCLOSURES 

AND PROVIDE DOCUMENTS BY JULY 

15, 2014

(Doc. No. 60)

I. INTRODUCTION

Plaintiffs Jagjeevan K. Dhaliwal and Mohinder S. Gill ("Plaintiffs") filed this action on 

April 3, 2013, alleging claims against Defendants Nirmal Singh, Nachhattar S. Chandi, Susana E. 

Chandi, KS Chandi & Sons, Inc., Chandi Brothers, LLC, and Valley Petroleum, Inc.

On August 16, 2013, the Court dismissed all claims against each of the Defendants with 

the exception of a breach of contract claim against Defendant KS Chandi & Sons, Inc. ("Chandi & 

Sons") and an involuntary dissolution claim against Chandi & Sons and Chandi Brothers, LLC 

("Chandi Brothers") (collectively, "Defendants"). 

On May 13, 2014, Plaintiffs filed a Motion for Sanctions to Exclude Evidence and 

Witnesses ("Motion to Exclude") asserting that Defendants had failed to make their initial 

disclosures pursuant to Federal Rule of Civil Procedure 26(a) and seeking the exclusion of any

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evidence Defendants may offer for any purpose. (Rule 60.) On the same day, Plaintiffs also filed 

a motion for summary judgment. (Doc. 54.)

Defendants filed a brief in opposition to Plaintiffs' Motion to Exclude on June 19, 2014, 

asserting they timely served their Rule 26(a)(1) initial disclosures on October 15, 2013. 

On June 20, 2014, the district court referred Plaintiffs' Motion to Exclude to the 

undersigned, and the hearing on the motion was reset to July 9, 2014. On June 23, 2014, a minute 

order was issued indicating that any reply brief in support of Plaintiffs' Motion to Exclude was to 

be filed by no later than June 26, 2014. (Doc. 73.) No reply brief was filed. 

On June 30, 2014, having reviewed the parties' briefs and supporting documentation, the 

Court determined the matter was suitable for decision without oral argument, the July 9, 2014, 

hearing was vacated, and the matter was taken under submission.

For the reasons set forth below, Plaintiffs' Motion to Exclude is DENIED. Plaintiffs' 

alternative request that Defendants be ordered to produce documents and witnesses is GRANTED 

IN PART. Defendants are ordered to supplement their initial disclosure statement to provide a 

more specific categorical breakdown of documents they intend to use to support their claims and 

defenses and these documents shall be produced to Plaintiffs by no later than July 15, 2014. 

Whether a further exclusionary sanction is warranted with respect to the documentary evidence 

offered by Defendants in support of their opposition to the motion for summary judgment is left

for the district court's determination.

II. BACKGROUND

A. Factual Background1

1. Summary

Mr. Singh is an ARCO AM PM ("AM PM") franchisee and developer who sought 

investors to purchase and develop AM PM gas station/convenience stores along with his brother 

and sister-in-law, Mr. and Ms. Chandi ("the Chandis"). The Chandis reside in Riverside County 

and, with Mr. Singh, own more than 10 California AM PMs. Chandi & Sons and Chandi Brothers

 

1 The factual background is taken from the District Court's summary of Plaintiffs' factual allegations as set forth in the 

Court's order of August 16, 2013. (Doc. 25.)

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are California corporations principally located in Turlock, California. At relevant times, Mr. 

Singh was the chief financial officer ("CFO") and shareholder of Chandi Brothers, a California 

corporation. Plaintiffs are husband and wife and Canadian physicians who claim to have been 

bilked out of a $1.35 million investment in the AM PMs at issue in this action.

2. Litigation Conduct Between the Parties

On October 3, 2013, the parties appeared for a Scheduling Conference, and a Scheduling 

Order was issued on October 9, 2013, requiring the parties to exchange initial disclosures on or 

before October 15, 2013. (Doc. 38.)

Plaintiffs maintain that no initial disclosures were made by Defendants on October 15, 

2013; the Plaintiffs made their disclosures. (Doc. 60-2, Durst Decl., ¶ 5.)

In January 2014, Mr. Bradford states he received a Notice of Taking Deposition and 

Request for Production of Documents for Nirmal Singh, which set Mr. Singh's deposition for 

February 6, 2014; the deposition date was continued by Plaintiffs to February 10, 2014. (Doc. 71-

1, Bradford Decl., ¶ 12.) Mr. Bradford and Mr. Singh were unavailable on February 10, 2014, and 

advised counsel for Plaintiffs, Lee Durst, Esq., of their unavailability and served objections to the 

deposition notice of Mr. Singh. (Doc. 71-1, Bradford Decl., ¶ 15.) 

On January 9, 2014, Mr. Durst sent a letter to Defendants' accountant Travis Salisbury

("Salisbury") demanding copies of Defendants' tax returns; a copy of the letter was not sent to Mr. 

Bradford, nor was Mr. Bradford notified of the request. (Doc. 71-1, Bradford Decl, ¶ 19.) Mr. 

Bradford informed Mr. Durst that Mr. Salisbury had no legal obligation to comply with the letter.

On April 2, 2014, Plaintiffs served Salisbury with a Subpoena to Produce Documents on 

April 22, 2014, to which Mr. Bradford served objections.2 (Doc. 71-1, Bradford Decl., ¶ 22.) On 

that same day, Plaintiffs also served Gaby Polous ("Polous"), as custodian of records for Polous & 

Polous, Inc. with a Subpoena to Produce Documents, to which Mr. Bradford served objections. 

(Doc. 71-1, Bradford Decl., ¶ 23.) According to Mr. Bradford, no other communication regarding 

these subpoenas was received from Mr. Durst until an email dated April 16, 2014.

 

2

Plaintiffs contend Defendants' objections to the subpoena are not proper. (See Doc. 65.)

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Also in April 2014, Plaintiffs began preparing to file a motion for summary judgment; in 

early April, Mr. Durst contacted Mr. Bradford via email indicating he had never received 

Defendants' initial disclosures. (Doc. 60-2, Durst Decl., ¶ 6; Exhibit A.) In this email, Mr. Durst 

also requested dates for Mr. Singh's deposition, as well as those for accountants Salisbury and 

Polous. (Doc. 60-2, Durst Decl., ¶ 7.) Mr. Durst maintains that by the time of his April 2014 

email to Mr. Bradford, Defendants had already "taken four depositions of our witnesses, Kevin 

Doan, Pauline Doan, Harpreet Dhaliwal, and Amanda Bui, and [Mr. Durst] relating to the subject 

matter of this case." (Doc. 60-2, Durst Decl., ¶ 7.)

On April 27, 2014, Mr. Durst sent another letter to Mr. Bradford indicating that he would 

be filing a motion for partial summary judgment on behalf of Plaintiffs and would seek exclusion 

of evidence as a violation for failure to make initial disclosures. Mr. Durst requested a response 

and a copy of the disclosures by April 30, 2014. (Doc. 60-2, Durst Decl., ¶ 9; Exhibit C.)

On May 2, 2014, Mr. Durst received a letter from Mr. Bradford dated April 28, 2014, 

denying Defendants had failed to make initial disclosures, and refusing to provide a copy of the 

disclosures. (Doc. 60-2, Durst Decl., ¶ 10.) On that same day, Mr. Durst sent another letter to Mr. 

Bradford demanding that Defendants provide a copy of their initial disclosures by 5:00 p.m. that 

day. (Doc. 60-2, Durst Decl., ¶ 11.) In response to Mr. Durst's letter, Mr. Bradford provided 5 

pages of documents "that are replete with errors that have been made for the first time by 

Defendants' counsel . . . ." (Doc. 60-2, Durst Decl., ¶ 12.) This was the first time Mr. Durst had 

received Defendants' two-page initial disclosure statement, and no documents were provided. 

(Doc. 60-2, Durst Decl., ¶ 12.)

B. Relevant Procedural Background

On October 9, 2013, following a scheduling conference, a Scheduling Order was issued. 

The Scheduling Order set October 15, 2013, as the deadline for the parties to make their initial 

disclosures. (Doc. 38.)

On May 13, 2014, Plaintiffs filed a motion for summary judgment. (Doc. 54.) On that 

same date, Plaintiffs also filed a Motion to Exclude. (Doc. 60.) On June 5, 2014, Plaintiffs filed 

a motion to compel accountant Travis Salisbury to comply with a subpoena duces tecum issued 

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pursuant to Rule 45. (Doc. 63.) Also on June 5, 2014, Plaintiffs filed a motion to compel Polous 

& Polous, Inc. to comply with a subpoena duces tecum. (Doc. 65.) 

On June 19, 2014, Defendants filed an opposition to Plaintiffs' motion for summary 

judgment (Doc. 70), as well as an opposition to Plaintiffs' Motion to Exclude (Doc. 71.) On June 

20, 2014, Plaintiffs' Motion to Exclude was referred to the undersigned, and the hearing on the 

motion was reset to July 9, 2014. (Doc. 72.) 

III. DISCUSSION

A. Legal Standard – Rule 26

Rule 26(a)(1) requires the parties disclose the identity of "each individual likely to have 

discoverable information – along with the subjects of that information – that the disclosing party 

may use to support is claims or defenses . . . " Rule 26(a) also requires the parties to disclose "a 

copy—or a description by category and location—of all documents . . . that the disclosing party 

has in its possession, custody, or control and may use to support its claims or defenses . . . ." This 

disclosure must occur at least 21 days before the scheduling conference is held or as ordered by 

the court.

The parties have a continuing duty to supplement these initial disclosures under Rule 26(e) 

if they learn in some material respect the disclosure is incomplete or incorrect, "and if the 

additional or corrective information has not otherwise been made known to the other parties 

during the discovery process or in writing." Fed. R. Civ. P. 26(e). As such, the proffering party 

may be absolved of its duty to serve a supplemental disclosure under Rule 26(e) to identify a 

certain person if the other parties have learned through other means that the person might have 

discoverable information regarding the proffering party's claims or defenses.

The failure to comply with Rule 26(a) disclosure requirements may result in the imposition 

of sanctions pursuant to Rule 37. In relevant part, Rule 37(c)(1) provides as follows:

If a party fails to provide information or identify a witness as required by Rule 

26(a) or (e), the party is not allowed to use that information or witness to supply 

evidence on a motion, at a hearing, or at trial, unless the failure was substantially 

justified or is harmless. In addition to or instead of this sanction, the court, on 

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motion and after giving an opportunity to be heard . . . may impose other 

appropriate sanctions, including any of the orders listed in Rule 37(b)(2)(A)(i)-(iv).

B. Defendants' Rule 26(a)(1) Initial Disclosure Statement Was Timely Served

1. The Parties' Contentions

Plaintiffs assert Defendants failed to timely serve their initial disclosure, and assert 

Defendants should be precluded from introducing any evidence or witnesses in support of their 

claims and defenses.

The gravamen of Plaintiffs' argument is that Mr. Bradford did not mail the initial 

disclosures to Mr. Durst on October 15, 2013, as he represents. Rather, Plaintiffs contend the 

proof of service of the initial disclosure statement, dated October 15, 2013, is fabricated in an 

effort to cover-up Defendants' untimeliness. As evidence, Plaintiffs note they did not receive 

Defendants' initial disclosure statement until May 2014, and when the statement was finally 

produced, it was only two pages and could have been provided by email or fax at the time of the 

initial request in early April. Plaintiffs argue Defendants have been sending documents to 

Plaintiffs via email over the course of the litigation, but for "some reason" the initial disclosure 

statement was mailed. Plaintiffs claim the only reason Defendants resorted to mailing this initial 

disclosure statement was to "be able to delay the production of documents and discovery because 

their documents and discovery would be very damaging to their case." (Doc. 60-1, 9:17-19.) 

Plaintiffs contend they have "not received a single document from Defendants," and in 

other state court litigation and bankruptcy proceedings involving many of these parties, 

Defendants have not produced any documents. (Doc. 60-1, 9:20-25.) In his declaration 

supporting Plaintiffs' motion, Mr. Durst argues the October 15, 2013, letter is "replete with errors," 

which establish that "Defendants' counsel had hastily prepared these documents on May 2, 2014, 

but dated them October 15, 2013, and in the haste made a large number of errors, to present to 

Plaintiffs that they have complied with Rule 26 and this Court's Scheduling Order." (Doc. 60-2, 

Durst Decl., ¶ 13.) Specifically, the cover letter to the initial disclosure statement from Mr. 

Bradford dated October 15, 2013, contains a case number that corresponds to the Doan litigation 

pending in state court; additionally, the cover letter indicates that Defendants' counsel represents 

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"Cross-Complainants, KS Chandi & Sons, Inc. and Chandi Brothers, LLC," but there are no crosscomplaints in this action. Finally, the proof of service accompanying the initial disclosures 

indicates Defendants' counsel represents "Defendants Kulvir Singh Mehroke, Bhajan Singh and

Kamboj LLC," who are Plaintiffs in the Mehroke litigation. 3

In response, Defendants filed Mr. Bradford's declaration and a copy of the initial disclosure 

statement mailed to Plaintiffs' counsel. The proof of service is dated October 15, 2013, and Mr. 

Bradford's declaration states it was prepared in October 2013 and served on October 15, 2013. 

(Doc. 71-1, Bradford Decl., ¶ 3; Doc. 71-1, Exhibit A.)

2. Analysis

The Court initially notes that the mistakes contained in Defendants' initial disclosure 

statement dated October 15, 2013, are not evidence of discovery misconduct. There were at least 

two other litigations involving some of the same parties who are represented by the same counsel 

as in this case. The fact that Defendants' initial disclosure statement and the proof of service 

contain careless mistakes referencing these other cases does not establish that Defendants 

manufactured their initial disclosure statement months after it was due. The same is true with 

regard to Plaintiffs' argument concerning the mailing, rather than emailing or faxing of the initial 

disclosure statement.

Plaintiffs appear to argue that Defendants' continued objection to the production of 

documents identified in the initial disclosure statement establishes Defendants did not make initial 

disclosures in October 2013. In response, Defendants maintain that Plaintiffs have never served a 

 

3 There have been at least two other civil actions that involve similar parties who are represented by the same counsel 

as the parties to this litigation. First, in Case No. 2:13-cv-00663-MCE-DAD, Plaintiffs Kulvir Singh Meroke, Bhajan 

Singh, and Kamboj LLC sued Nirmal Singh, Nacchattar S. Chandi, Susana E. Chandi, and KS Chandi & Sons, Inc. 

alleging they were bilked out of $2.354 million by the defendants related to investments in AM PM franchises in 

California. The plaintiffs in that action are represented by Lee Durst, Esq.; the defendants are represented by Matthew 

Bradford, Esq. That action was voluntarily dismissed on April 29, 2013, and the matter has been closed. ("Meroke

litigation").

There is also a state court litigation involving many of the same parties pending in the Stanislaus County Superior 

Court. In that case, entitled Doan v. Singh, Case No. 684071, Lee Durst, Esq., represents Plaintiffs Harpreet 

Dhaliwal, Pauline Doan, and Devin Doan. Matthew Bradford, Esq., represents Defendants Nirmal Singh, Watsonville 

Petroleum, Inc., Chandi Brothers, LLC, Modesto Petroleum, Inc., Randjeet Singh, Gurdev Singh Teer, Chadha 

Construction, Inc, KS Chandi & Sons, Paul Raj Chadha, Aasra Petroleum, Inc., and JPH LLC. ("Doan litigation"). 

According to the public docket, that case is set for jury trial on October 21, 2014.

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document request other than the April 2014 subpoenas served on Salisbury and Polous. 

Additionally, although Plaintiffs served a document request with the Notice of Taking Deposition 

of Nirmal Singh, Defendants counsel objected to that notice and no other notice has been served. 

Rule 26(a)(1)(A)(ii) does not require the actual production of documents. Rather, it 

requires only that the disclosing party provide "a copy—or a description by category and 

location—of all documents . . . . " Fed. R. Civ. P. 26(a)(1)(A)(ii)(emphasis added). That 

Defendants have not provided actual documents to Plaintiffs is not evidence Defendants' initial 

disclosure statement was not timely provided in October 2013 in the face of Mr. Bradford's 

declaration and the proof of service of the initial disclosure statement.

4

In sum, there is no evidence that Defendants failed to timely serve their initial disclosure 

statement on October 15, 2013.

B. Sufficiency of Defendants' Rule 26(a)(1) Initial Disclosures

Plaintiffs argue that, even assuming Defendants' initial disclosure statement was timely, it 

is insufficient. Plaintiffs claim the description of documents contained in the initial disclosure 

statement is impermissibly vague such that Plaintiffs could not make an informed decision about 

how to frame document requests. Plaintiffs also argue the identification of witnesses in the initial 

disclosure statement is inadequate because it does not include the subject of the information 

known by the witness, but instead contains only the names of the witnesses. 

1. Disclosure of the Subject of Information Disclosed Witnesses Were Likely to 

Possess

Defendants' initial disclosure statement provides the names of only six individuals, but the 

subject of information that each individual is likely to possess is not provided. (Doc. 71-1, 

Bradford Decl., Exhibit A.) For purposes of the summary judgment motion pending before the 

district court, no testimony or evidence from the first four witnesses identified in the initial 

 

4 The Court notes Plaintiffs provide no evidence establishing they sought a statement of initial disclosures from 

Defendants at any time before April 2014; rather, the record reflects they waited until nearly 6 months after the 

disclosures were due before asking Defendants whether disclosures had actually been made. This has no bearing on 

the timeliness of Defendants' disclosure, but it does evidence a lack of diligence by Plaintiffs with respect to exploring 

the basis of Defendants' defenses. The parties were aware of the deadline to submit initial disclosures as it was set 

forth in the scheduling order. (Doc. 38.)

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disclosures are offered by Defendants. Thus, for purposes of the motion for summary judgment, 

the failure to identify the subject of the information likely held by these four witnesses is harmless. 

Moreover, because two of these witnesses (Jagjeevan K. Dhaliwal and Mohinder S. Gill) are 

Plaintiffs themselves, Plaintiffs were fully aware of what information they possessed pertinent to 

the litigation. The third and fourth witnesses (Harpreet Dhaliwal and Amanda Bui) are plaintiffs 

in the Doan litigation, and are represented by Mr. Durst. Although the disclosure statement was 

deficient in failing to identify the subject of the information these individuals were likely to have, 

the Court can discern no prejudice or harm to Plaintiffs in this regard. As such, no sanction is 

warranted. Fed. R. Civ. P. 37(c)(1).

2. Insufficiency of Initial Disclosure as to Raj Grewal is Not Harmful

As it pertains to Defendants' identification of Raj Grewal, the initial disclosure statement 

indicates that no telephone number or address was known at the time of the disclosure statement. 

Further, the subject of information Mr. Grewal is likely to possess was not provided by 

Defendants. It is not clear whether Mr. Grewal's address and telephone number was discovered by 

Defendants at any time during the litigation triggering a duty to supplement the disclosure 

statement. Fed. R. Civ. P. 26(e). As to the subject of information Mr. Grewal is likely to provide 

or possess, the Court finds Defendants' initial disclosure is insufficient with regard to this witness. 

For purposes of the pending summary judgment motion, however, Defendants do not seek 

to present any evidence or testimony from Raj Grewal. Thus, there is no present harm to Plaintiffs 

in failing to sufficiently state the subject of information this witness is likely to possess. 

Moreover, other than noticing a deposition of Mr. Singh and serving subpoenas on Salisbury and 

Polous, Plaintiffs have not conducted any discovery to obtain information about Mr. Grewal. To 

the extent Defendants attempt to offer testimony or evidence from Mr. Grewal at a later time in the 

proceedings, Plaintiffs may renew their evidentiary objection based on Rule 26(a). 

3. Initial Disclosure as to Nirmal Singh

Plaintiffs seek to exclude the declaration of Nirmal Singh filed by Defendants in support of 

their opposition to Plaintiffs' motion for summary judgment. (See Doc. 70-1, Singh Declaration.) 

Nirmal Singh was identified in Defendants' initial disclosure statement, but his telephone number 

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and address were not listed; it was noted Mr. Singh could be contacted through Defendants' 

counsel. This is appropriate as Mr. Singh is a defendant in other litigation involving a number of 

the same parties and similar issues, and Mr. Durst and Mr. Bradford are counsel for the parties in 

that case. As a result, Mr. Durst is prohibited from directly contacting Mr. Singh. Cal. Rules of 

Prof. Conduct Rule 2-100. Nevertheless, Defendants did not provide the subject matter of 

information Mr. Singh was likely to possess. This is a technical violation of the disclosure 

requirements under Rule 26(a)(1)(A)(i). 

Although a technical violation of Rule 26(a)(1), it is difficult to draw the conclusion this 

deficiency was harmful to Plaintiffs under Rule 37(c)(1). As Mr. Singh was initially named as a 

Defendant in this action, and the complaint contains numerous detailed allegations regarding his 

conduct, Plaintiffs are familiar with Mr. Singh and the subject matter of the information he was 

likely to provide or possess. 

Additionally, even to the extent this deficiency was somehow harmful to Plaintiffs, the 

factual circumstances of this case do not warrant a particularly harsh sanction, such as exclusion of 

evidence. Plaintiffs were aware of the initial disclosure deadline of October 15, 2013, yet 

apparently waited until after discovery was closed to raise the issue of an incomplete and 

insufficient initial disclosure statement. Moreover, Plaintiffs have had an opportunity to schedule 

the deposition of Mr. Singh. While Plaintiffs complain this deposition has not occurred because 

Defendants have failed to cooperate, no motion has been filed seeking to compel his deposition.

The record evidences a lack of diligence in this regard. Any prejudice or harm accruing from the 

inadequate disclosures was compounded, in no small part, by Plaintiffs' lack of attention to the 

progress of the litigation. See Sheridan v. FIA Card Servs., No. C13-01179 HRL, 2014 WL 

587739, at 2 (N.D. Cal. Feb. 14, 2014) ("Regardless of whether FIA's initial disclosures were 

sufficiently specific, the Court will not exclude such relevant evidence where [the plaintiff] made 

no attempt whatsoever to obtain the material or any other discovery from [the defendant], 

particularly in view of the fact that the declarations provide only basic account information that 

would have been produced in response to even the most perfunctory of discovery requests.").

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In sum, the insufficiency of Defendants' Rule 26(a) disclosure statement is technical and, 

under the circumstances of this case, the Court can discern no harm to Plaintiffs. See Fed. R. Civ. 

P. 37(c)(1) (no sanction where failure is harmless).5 Nevertheless, because Mr. Singh's declaration

is offered to the district court as evidence in opposition to a pending motion for summary 

judgment, and because the equities do not strongly favor Plaintiff, the remedy for this technical 

failure is left to the discretion of the district court. 

4. Defendants Initial Disclosures of Documents

As set forth above, Rule 26(a)(1)(A)(ii) requires that "a copy—or a description—of all 

documents" that the disclosing party has in its possession, custody, or control and may use to 

support its claims and defenses shall be provided to the other parties. Fed. R. Civ. P. 

26(a)(1)(A)(ii). Plaintiffs argue the categories of documents identified by Defendants are broad 

and do not provide Plaintiffs with sufficient information to propound and serve discovery requests.

Defendants identified four categories of documents they may use to support their claims or 

defenses:

1. Loan documents (including amendments, revisions, etc.) which are in 

possession of Defendants, Defendants' counsel and Plaintiffs.

2. Correspondence between Plaintiffs and Nirmal Singh and/or Defendants 

that pertain to payments, the loan, investment, operations of the Defendants 

and other matters. These documents are in the possession of Defendants, 

Defendants' counsel and Plaintiffs.

3. Accounting records regarding the Defendants. These documents are in the 

possession of Defendants.

4. Financial records and reports of Defendants. These documents are in the 

possession of Defendants.

(Doc. 71-1, Bradford Decl., Exhibit A.) Plaintiffs argue this was so insufficiently vague they 

could not formulate discovery requests, make "an informed decision concerning which documents 

Plaintiffs needed to examine[,] . . . or frame their document requests in a manner likely to avoid 

squabbles resulting from the wording of the request." (Doc. 60-1, 11:1-22.) Plaintiffs complain 

 

5

Plaintiffs correctly note that it is Defendants' burden to establish the insufficiency of their disclosure was harmless; 

Defendants did not address this issue, but the undersigned cannot discern any harm given the facts of this case.

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Defendants have objected to Subpoenas for Production of Documents with respect to Defendants' 

accounting records ostensibly in the possession of Salisbury and Polous, and have blocked 

Plaintiffs' attempts to obtain these documents. 

The categories of documents identified in Defendants' initial disclosure statement are 

vague and insufficient. See N. Am. Lubricants Co. v. Terry, No. 11-cv-1284-KJM-GGH, 2011 

WL 582832, at *5 (E.D. Cal. Nov. 18, 2011) (finding description "business files for NALC" to be 

so broad as to be meaningless). The broad categories gives no notice to Plaintiffs which 

documents Defendants may use to support their claims. At this stage, the Court presumes that 

Defendants have investigated their claims and are able to provide a more categorical breakdown of 

documents. Although Plaintiffs seek exclusion of all Defendants' documentary evidence, the 

factual circumstances of this case weigh against such a sanction. First, Plaintiffs delayed inquiring 

about Defendants' initial disclosure statement until April 2014, more than 5 months after it was to 

be served. Second, Plaintiffs bypassed moving to compel supplementation of the initial disclosure 

statement pursuant to this Court's Local Rule 251. Finally, Plaintiffs have not served discovery on 

Defendants seeking the production of any documents, other than the requests noted above, which 

occurred late in the discovery process. See Sheridan, 2014 WL 587739, at 2.

Defendants must supplement their disclosures by providing a categorical breakdown of the 

documents they intend to use in this litigation, and because of the current posture of the case, these 

identified documents must also be produced to Plaintiffs either via electronic means or in hard 

copy. Since the district court will be addressing Plaintiffs' motion for summary judgment, it can 

more appropriately address the issue of any additional sanction for Defendants' insufficient 

disclosure statement as to the identification of documents. 

5. Declaration of Travis Salisbury in Support of Defendants' Opposition to the 

Motion for Summary Judgment

Plaintiffs' preemptive Motion to Exclude was served before Defendants filed their 

opposition.6 Plaintiffs' Motion to Exclude seeks to preclude Defendants from offering any 

evidence in support of their claims or defenses that was not initially disclosed. Defendants offer 

 

6 Typically, evidentiary objections such as Plaintiffs' would have been raised in the reply to Defendants' opposition.

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the declaration of Salisbury in support of their opposition to Plaintiffs' motion for summary 

judgment. (Doc. 70-2, Salisbury Decl.) 

Plaintiffs were apparently aware Salisbury had possession of Plaintiffs' accounting records 

and documents as early as January 9, 2014, when Mr. Durst sent a letter to Salisbury requesting 

copies of Defendants' tax returns between 2007 and 2012. (Doc. 71-1, Bradford Decl., Exhibit C.) 

The existence of accounting and financial records was noted in Defendants' initial disclosure 

statement, but no discovery was served on Defendants seeking the production of those documents. 

To the extent Plaintiffs wish to specifically object to Salisbury's declaration based on lack 

of disclosure under Rule 26(a), Plaintiffs may do so in their reply to Defendants' opposition to the 

motion for summary judgment. The hearing on Plaintiffs' motion for summary judgment is set for 

July 9, 2014 (Doc. 74), and pursuant to this Court's local rules, any reply brief must be filed on or 

before July 2, 2014. Local Rule 230(d).

6. Plaintiffs' Alternative Request to Compel Defendants to Produce Evidence

Plaintiffs request that, if the motion to exclude is not granted, Defendants be ordered to

immediately produce accountants Salisbury and Polous for deposition, and that Salisbury and 

Polous produce all documents in their possession.

Defendants failed to disclose Salisbury in their initial disclosure statement, and Plaintiffs 

may raise their objection to the declaration of Salisbury in their reply to Defendants' opposition to 

the motion for summary judgment. The issue of compelling all documents from Salisbury and 

Polous pursuant to Plaintiffs' Rule 45 subpoenas is currently pending before the undersigned, and 

will be decided by separate order.

IV. CONCLUSION AND ORDER

For the reasons set forth above, Plaintiffs' Motion to Exclude is DENIED. Defendants' 

initial disclosure statement was timely, but it was insufficient in certain regards. As to Mr. Singh's 

declaration offered in support of Defendants' opposition to the motion for summary judgment, any 

technical deficiency in the initial disclosure statement is harmless. Nevertheless, because this 

declaration is before the district court for consideration relating to a pending motion for summary 

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judgment, if the district court concludes there was harm to Plaintiffs as a result of the 

insufficiency, the district court may impose any appropriate remedy.

As to Mr. Salisbury's declaration, also offered in support of Defendants' opposition to the 

motion for summary judgment, Plaintiffs may raise any specific objection on Rule 26(a) grounds

in their reply to the Defendant's opposition to the motion for summary judgment so that it may be 

considered by the district court. 

Defendants' disclosure of categories of documents in the initial disclosure statement is 

inadequate. As such, Defendants shall provide Plaintiffs with a supplemental disclosure statement 

providing a more specific categorical breakdown of documents they intend to use and shall 

produce those documents to Plaintiffs by no later than July 15, 2014. Because Defendants have 

submitted documentary evidence in support of their opposition to the motion for summary 

judgment pending before the district court, the undersigned leaves to the district court's discretion 

whether the insufficient disclosures requires further sanction through exclusion.

Accordingly, IT IS HEREBY ORDERED that:

1. Plaintiffs' Motion to Exclude is DENIED;

2. Plaintiffs' alternative request that Defendants be ordered to produce documents is 

GRANTED in part;

a. Defendants shall supplement their initial disclosure statement to provide a 

more specific categorical identification of documents they will use to 

support their claims and defenses; 

b. Defendants shall produce all documents identified in their supplemental 

initial disclosure statement to Plaintiffs by no later than July 15, 2014, 

either electronically or in paper form; and 

c. The issue of whether Defendants' insufficient disclosure of documents 

requires further sanction is left to the discretion of the district court;

3. Plaintiffs may raise any objection to Mr. Salisbury's declaration, which is offered in 

support of Defendants' opposition to the motion for summary judgment, in 

Plaintiffs' reply brief for the district court's consideration;

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4. To the extent Defendants attempt to offer evidence or testimony of Mr. Grewal 

at any later proceeding, hearing, or motion, Plaintiffs may renew their objection 

based on Rule 26(a) at that time; and

5. To the extent the district court concludes Defendants' failure to identify the subject 

matter of information Mr. Singh was likely to possess was harmful to Plaintiffs, 

any sanction will be left to the discretion of the district court.

IT IS SO ORDERED.

Dated: June 28, 2014 /s/ Sheila K. Oberto 

UNITED STATES MAGISTRATE JUDGE

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