UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF MICHIGAN 

SOUTHERN DIVISION 

DGD PROCESSING 

SOLUTIONS, LLC, 

 Plaintiff/Counter-Defendant, CIVIL ACTION NO. 14-cv-13740 

 v. DISTRICT JUDGE GEORGE CARAM STEEH 

 

MD FINANCIAL, LLC and MAGISTRATE JUDGE MONA K. MAJZOUB 

MICHAEL D’AMBROSE, 

 Defendants/Counter-Plaintiff, 

and 

SPEEDY SERVICING, INC., 

Intervenor-Plaintiff. 

__________________________________/ 

OPINION AND ORDER GRANTING IN PART AND DENYING IN PART 

PLAINTIFF’S MOTION TO DEEM MATTERS ADMITTED [27] 

 This matter comes before the Court on Plaintiff DGD Processing Solutions, LLC’s 

Motion to Deem Matters Admitted. (Docket no. 27.) Defendants MD Financial, LLC and 

Michael D’Ambrose responded to Plaintiff’s Motion (docket no. 32), and Plaintiff replied to 

Defendants’ Response (docket no. 34). The Motion has been referred to the undersigned for 

consideration. (Docket no. 28.) The Court has reviewed the pleadings and dispenses with oral 

argument pursuant to Eastern District of Michigan Local Rule 7.1(f)(2). The Court is now ready 

to rule pursuant to 28 U.S.C. § 636(b)(1)(A). 

 This matter involves counter-breach-of-contract claims related to a Payment Facilitation 

Agreement (PFA) between Plaintiff and Defendants. (See docket nos. 1 and 42.) Plaintiff served 

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Defendants with a set of discovery requests, including Requests for Admission, on February 3, 

2015. (Docket no. 27 at 14-24.) Defendants served Plaintiff with responses on March 4, 2015. 

(Docket no. 27 at 3; docket no. 32 at 5.) That same day, Plaintiff pointed out deficiencies in 

those responses to Defendants, and Defendants agreed to supplement them, which they did on 

March 11, 2015. (Docket no. 34 at 5-8; docket no. 27 at 25-38; docket no. 32-2.) Plaintiff 

subsequently filed the instant Motion to Deem Matters Admitted on April 17, 2015. (Docket no. 

27.) 

Federal Rule of Civil Procedure 36 permits a party to serve on any other party a written 

request to admit the truth of any matter within the scope of Rule 26(b)(1). Rule 36(a)(4) 

provides that, if a party does not admit a request to admit, then “the answer must specifically 

deny it or state in detail why the answering party cannot truthfully admit or deny it.” Fed. R. 

Civ. P. 36(a)(4). The Rule further provides, “[a] denial must fairly respond to the substance of 

the matter; and when good faith requires that a party qualify an answer or deny only a part of the 

matter, the answer must specify the part admitted and qualify or deny the rest.” Id. Rule 

36(a)(6) provides a party objecting to the sufficiency of a request for admission’s answer the 

ability to bring a motion for the determination of the answer’s sufficiency. Fed. R. Civ. P. 

36(a)(6). If the Court finds that a party’s objection is justified, then Rule 36 permits the Court to 

order “either that the matter [be] admitted or that an amended answer be served.” Fed. R. Civ. P. 

36(a)(6). 

Plaintiff alleges that Defendants’ supplemental responses to its Requests for Admission 

nos. 1, 2, and 3 are deficient and do not comply with Rule 36. (Docket no. 27 at 3.) As relief, 

Plaintiff seeks a court order deeming that Request nos. 1, 2, and 3 are admitted, or, in the 

alternative, compelling Defendants to produce documents and facts that support their denials. 

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(Id. at 7.) The Court presents each of the contested requests and responses in relevant part and 

will address the parties’ arguments in turn. 

A. Request for Admission No. 1 

Plaintiff’s Request: 

Please admit that MDF never attempted to submit any ACH transactions to DGD 

for processing after June 9, 2014. If your response is anything other than an 

unqualified admission, please: 

a. State in detail all facts that support your response; 

b. Produce all documents that support your response; 

c. Identify all witnesses who will testify in support of your response.1 

(Docket no. 27 at 17.) 

Defendants’ Response:

MDF denies this request for admission. MDF made every effort to process ACH 

transactions through DGD until such time as DGD could no longer perform. This 

occurred on or about June 9, 2014 (and the parties had notice of this as early as 

June 3, 2014). DGD lost access to Talmer Bank and communicated to MDF that it 

had no other ODFI lined up at the time. This request improperly implies that 

DGD’s failure to perform is the result of MDF’s malfeasance, not DGD’s. See 

also MDF’s previous document production bates nos. 0001-00197. Very little 

discovery has taken place to date, and MDF reserves the right to supplement this 

response as discovery proceeds. 

The witnesses known or believed by Defendants to have knowledge of 

discoverable information include, but are not limited to, . . . . 

Defendants otherwise object to this Request for Admission to the extent that it is 

premature, overly broad, unduly burdensome, seeks information neither relevant 

nor reasonably calculated to lead to the discovery of admissible evidence, and is 

vague and ambiguous. 

(Id. at 30-31.) 

 Plaintiff argues that Defendants’ denial does not fairly respond to the substance of the 

matter. (Id. at 3.) Specifically, Plaintiff argues that Defendants are entitled to explain why they 

did not submit ACH transactions to Plaintiff after June 9, 2014, but it is improper for Defendants 

 

1

 This sentence also appears with Plaintiff’s Requests for Admission nos. 2 and 3; however, the Court will only 

reproduce it once, here. 

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to deny the Request where they, in fact, did not submit ACH transactions to Plaintiff after June 9, 

2014, and have not set forth any facts or documents to support their denial. (Id. at 4.) 

Defendants contend that Plaintiff seeks an answer to a question that it did not ask, pointing out 

that Request no. 1 does not ask Defendants to admit that they did not submit ACH transactions to 

Plaintiff for processing after June 9, 2014, it asks Defendants to admit that they never attempted 

to submit ACH transactions to Plaintiff for processing after June 9, 2014. (Docket no. 32 at 8.) 

Defendants elaborate that they are able to admit that they did not submit ACH transactions to 

Plaintiff for processing after June 9, 2014, but that it would be inaccurate to admit that they 

never attempted to do so. (Id.) 

 Defendants’ position holds merit. The Court finds that Defendants appropriately 

responded to Plaintiff’s Request for Admission no. 1 as worded, in accordance with Rule 

36(a)(4). The Court will deny Plaintiff’s Motion in this regard. 

B. Requests for Admission Nos. 2 and 3 

Plaintiff’s Request No. 2: 

Please admit that, prior to June 27, 2014, MDF never gave notice to DGD that 

DGD materially breached the PFA. 

(Docket no. 27 at 17.) 

Defendants’ Response: 

MDF is unable to admit or deny this request for admission at this time. At this 

early juncture of the lawsuit, MDF is unaware of any written notice made by 

MDF to DGD prior to June 27, 2014 declaring DGD to be in material breach of 

the processing agreement. However, DGD has not, to date, produced documents 

(MDF has), and discovery is ongoing. See also MDF’s previous document 

production bates nos. 0001-0197. MDF reserves the right to supplement this 

response as discovery proceeds. 

In further response, MDF denies that any such written notice was required, 

because, as early as June 3, 2014, DGD and MDF were both on notice that Talmer 

Bank had canceled its processing contract with DGD, and that DGD was 

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incapable of processing additional ACH transactions for MDF. At this time, DGD 

and MDF had discussions concerning mistakes that DGD had made, which caused 

issues with Talmer Bank. DGD was, thus, aware of its material breach of the 

processing agreement. DGD’s performance problems occurred before expiration 

of the 60-day ramp up. DGD failed to provide MDF with adequate assurances of 

continued performance. Notwithstanding the foregoing, on June 27, 2014, DGD 

inexplicably demanded millions of dollars in purported damages from MDF and 

threatened to hold all monies related to the processed transactions, refusing to 

remit such funds to MDF. MDF responded to this unconscionable behavior by 

formally rescinding the contract in writing on June 30, 2014. 

The witnesses known or believed by Defendants to have knowledge of 

discoverable information include, but are not limited to, . . . . 

Defendants otherwise object to this Request for Admission to the extent that it is 

premature, overly broad, unduly burdensome, seeks information neither relevant 

nor reasonably calculated to lead to the discovery of admissible evidence, and is 

vague and ambiguous. 

(Id. at 31-32.) 

Plaintiff’s Request No. 3: 

Please admit that MDF never gave notice to DGD that DGD materially breached 

the PFA. 

(Id. at 18.) 

Defendants’ Response: 

 Denied. See Response No. 2. 

(Id. at 32.) 

 Plaintiff argues that Request nos. 2 and 3 should be deemed admitted because Defendants 

have not set forth any facts or documents to support the assertion that notice of material breach 

was given. (Id. at 5.) Defendants assert that their Response to Request no. 2 acknowledged their 

lack of awareness of any formal written notice issued prior to June 27, 2014. (Docket no. 32 at 

11.) Defendants also allude to discussions that took place between the parties prior to June 27, 

2014, and assert that whether those discussions constitute notice of material breach is a question 

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of fact for the Court or a jury to decide. (Id. at 11-12.) Defendants further assert that Plaintiff’s 

Motion is premature because at the time of Plaintiff’s discovery request, Defendants had not yet 

received document discovery from Plaintiff or other entities; Defendants argue that they should 

be permitted to obtain and review the documents they requested before they are required to admit 

or deny Plaintiff’s Requests for Admission. (Id. at 12.) 

 The Court understands Defendants’ arguments, but finds that Defendants’ Responses lack 

specificity and are not qualified as required by Rule 36(a)(4), especially with regard to whether 

Defendants gave Plaintiff verbal notice of material breach. Defendants’ explanation in their 

Response to Plaintiff’s Motion does not cure their deficient discovery responses. Accordingly, 

the Court will order Defendants to amend their Responses to Requests for Admission nos. 2 and 

3 to conform with the correct form of answer under Rule 36(a)(4). At this stage of the litigation, 

any further argument from Defendants regarding an inability to answer due to a lack of 

document discovery is invalid. Defendants will succinctly and specifically either admit or deny 

Plaintiff’s Requests for Admission nos. 2 and 3, and qualify their responses where necessary 

without any ancillary argument, within fourteen (14) days of this Opinion and Order. 

 IT IS THEREFORE ORDERED that Plaintiff’s Motion to Deem Matters Admitted 

[27] is GRANTED IN PART AND DENIED IN PART as follows: 

a. Plaintiff’s Motion with regard to Request for Admission no. 1 is DENIED; 

b. Plaintiff’s Motion with regard to Requests for Admission nos. 2 and 3 is 

GRANTED IN PART and DENIED IN PART. Plaintiff’s Requests for 

Admission nos. 2 and 3 are not deemed admitted; Defendants are ordered to 

amend their Responses to Requests for Admission nos. 2 and 3 to succinctly and 

specifically either admit or deny the Requests, and qualify their responses where 

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necessary without any ancillary argument, within fourteen (14) days of this 

Opinion and Order. 

NOTICE TO THE PARTIES 

 Pursuant to Fed. R. Civ. P. 72(a), the parties have a period of fourteen days from the date 

of this Order within which to file any written appeal to the District Judge as may be permissible 

under 28 U.S.C. § 636(b)(1). 

Dated: September 18, 2015 s/ Mona K. Majzoub 

 MONA K. MAJZOUB 

 UNITED STATES MAGISTRATE JUDGE 

PROOF OF SERVICE

 I hereby certify that a copy of this Opinion and Order was served upon counsel of record 

on this date. 

Dated: September 18, 2015 s/ Lisa C. Bartlett 

 Case Manager

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