UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF INDIANA 

FORT WAYNE DIVISION 

CCT ENTERPRISES, LLC, 

 Plaintiff, 

 v. 

KRISS USA, INC., 

 Defendant. 

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Case No. 1:14-CV-249 JD 

OPINION AND ORDER

Now before the Court is defendant Kriss USA, Inc.’s motion to exclude material 

produced after discovery. [DE 41]. The relevant facts have been set forth and discussed at length 

in the party’s filings and during the telephonic hearing on the motion. In short, this is a 

commercial dispute between plaintiff CCT Enterprises, LLC, which manufactures component 

parts used in firearms, and Kriss USA, Inc., which assembles and sells firearms. Around January 

2013, the parties entered an agreement for CCT to manufacture various component parts for 

Kriss. The terms of the parties’ agreement were spread over various purchase orders, quotes, and 

written and verbal communications. This arrangement continued for over a year, when Kriss 

terminated the relationship and purported to withdraw its pending purchase orders. CCT then 

filed this suit for breach of contract and promissory estoppel, claiming that Kriss was not entitled 

to cancel the orders. 

A central point of contention in this matter is what terms the parties agreed to relative to 

the cancellation of any purchase orders. Some purchase orders contained a caveat stating, “Either 

party can cancel this purchase order at any time with a 30-day advance notification.” [DE 42-1]. 

The parties also had discussions relative to the cancellation provisions, and as to some of the 

purchase orders, may have agreed to cross off the caveat. At a deposition held the day prior to 
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the close of discovery, a CCT employee testified that as to the very first purchase order between 

the parties, he had discussed the cancellation provision with Kriss, and that pursuant to those 

discussions, he crossed off the cancellation provision and sent the purchase order back to Kriss. 

However, no such document had been produced in discovery, though it would have been 

responsive to document requests Kriss propounded over a year earlier. CCT was unable to locate 

the document during the deposition, but after subsequent searching, CCT produced the modified 

purchase order to Kriss on December 14, 2015, shortly after the close of discovery. Consistent 

with the employee’s testimony, the cancellation provision on that document had been crossed 

off. 

Kriss then filed the present motion to exclude the document under Rule 37(c), arguing 

that CCT failed to timely produce the document during discovery and that Kriss had been 

prejudiced by its inability to conduct any follow-up discovery on the document, given the close 

of discovery. Rule 37(c) states: 

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 a trial, unless the failure was substantially justified 

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

after giving an opportunity to be heard: 

(A) may order payment of the reasonable expenses, including attorney's fees, 

caused by the failure; [or] 

. . . . 

(C) may impose other appropriate sanctions . . . . 

Fed. R. Civ. P. 37(c). “The exclusion of non-disclosed evidence is automatic and mandatory 

under Rule 37(c)(1) unless non-disclosure was justified or harmless.” Musser v. Gentiva Health 

Services, 356 F.3d 751, 758 (7th Cir. 2004). However, the Seventh Circuit has warned that “‘in 

the normal course of events, justice is dispensed by the hearing of cases on their merits.’” Id. at 
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759 (quoting Salgado v. General Motors Corp., 150 F.3d 735, 740 (7th Cir. 1998)). Thus, the 

Seventh Circuit “urge[s] district courts to carefully consider Rule 37(c), including the alternate 

sanctions available,” before excluding evidence that may affect a case’s outcome. Id.

The Court concludes that sanctions are justified under these circumstances, but that 

instead of excluding the document, the appropriate course is to reopen discovery for the limited 

purpose of allowing Kriss to conduct any follow-up discovery necessary as to the Modified PO, 

and to require CCT to pay the reasonable costs of that discovery. To begin with, CCT argues that 

its failure to produce the document earlier was an honest oversight, and that it has diligently 

discharged its discovery obligations. The Court has no reason to suspect subjective bad faith by 

CCT, but that explanation does not undo the prejudice that could accrue to Kriss from the 

untimely production of the document, or excuse CCT from responsibility for failing to produce 

the document earlier. Nor has CCT been able to explain why this document was not produced 

earlier if its search for responsive documents was as diligent as it claims, particularly since this is 

a document upon which CCT’s case is founded. CCT had an obligation to timely produce the 

document as requested, and it should be CCT that bears the cost for its failure to do so. Fautek v. 

Montgomery Ward & Co., Inc., 96 F.R.D. 141, 145 (N.D. Ill. 1982) (“Parties are required to 

respond to requests to produce in a complete and accurate fashion. This in turn requires that 

parties take reasonable steps to ensure that their responses to requests to produce are complete 

and accurate. Ultimate production of the material in question does not absolve a party where it 

has failed to produce the material in a timely fashion.”). 

That said, the lack of bad faith does weigh against excluding the document entirely 

instead of permitting it to cure the prejudice. In that vein, the Court believes that the prejudice to 

Kriss can be appropriately remedied by re-opening discovery and requiring CCT to bear the costs 
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of that discovery. In arguing that exclusion is the appropriate remedy, Kriss relies heavily on 

Davis v. Lakeside Motor Company, Inc., No. 3:10-cv-405, 2014 WL 1316945 (N.D. Ind. Mar. 

31, 2014). However, the circumstances in that case were much more aggravating than the 

circumstances here, and warranted a more severe sanction. In Davis, the documents in question 

were disclosed after the case had been pending for over three years, discovery had been closed 

for over a year, dispositive motions had already been ruled on, and a trial date had already been 

set. The documents also only came to light when the defendant produced them among its 

proposed trial exhibits, and some of them had been in counsel’s possession for over two years 

before they were produced. The circumstances of the disclosure and other instances of 

misconduct by the defendant also reflected a general indifference to the party’s discovery 

obligations. Under those circumstances, the Court concluded that reopening discovery at such a 

late stage and further delaying trial was not appropriate, so it excluded the documents. Here, 

however, this case is not nearly as old, and a trial date has not yet been set. The document’s 

existence was also disclosed during the discovery period, and the document itself was produced 

only shortly thereafter. And as just noted, the circumstances here are not indicative of any bad 

faith. Therefore, the same result as in Davis is not compelled here. 

Imposing no sanction at all would leave Kriss unfairly prejudiced, though, as Kriss would 

be deprived of the opportunity to conduct discovery into the document and its authenticity. To 

conduct adequate inquiry into the document, it appears reasonable for Kriss to re-depose at least 

Mr. Nagel and Mr. Stevenson, the two individuals whose communications allegedly led to the 

modification. Kriss has already conducted depositions of both of those individuals, and if CCT 

had timely produced the document in question, Kriss could have fully questioned those witnesses 

about the document with little expense. But to re-depose them, it will have to schedule, prepare 
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for, and attend the additional depositions and also retain court reporters. Accordingly, the Court 

believes that it is appropriate to require CCT to reimburse Kriss for those attorneys’ fees and 

costs, which would not have been incurred had the document been timely produced. Kriss also 

raised the possibility of retaining an expert to analyze the document’s authenticity, which Kriss 

asserts has been called into question by the circumstances of its production. To the extent such 

an analysis is even feasible and would be reasonable under the circumstances, Kriss may seek 

recovery for those expenses also. Kriss may also seek recovery of its expenses in propounding 

any additional written discovery that may be necessary. As discussed at the telephonic hearing, 

however, the Court will require Kriss to submit an estimate of the reasonable expenses it believes 

will be necessary to conduct the appropriate discovery. Should CCT wish to withdraw the 

document rather than incur those expenses, it may do so. 

Finally, Kriss also seeks an award of attorneys’ fees that it incurred in bringing this 

motion. CCT’s only response specific to that request was that it should be denied because Kriss 

failed to adequately confer with CCT before filing the motion, as required under the local rules. 

Though the Federal Rules of Civil Procedure do not require parties to confer before filing a 

motion to exclude under Rule 37(c), Local Rule 37-1(a) imposes such a requirement on “any 

discovery motion.” However, the Court finds that Kriss adequately met that requirement. Prior to 

filing its motion, Kriss sent a letter to CCT requesting that it agree to the relief that Kriss sought 

in its motion, and detailing the factual support for that request. CCT responded by declining to 

agree. Under the circumstances, further discussion would likely have been unfruitful, as CCT 

was unlikely to withdraw the document voluntarily or agree to pay Kriss’ expenses if discovery 

was reopened. Accordingly, the Court will award Kriss its reasonable expenses in bringing the 

motion, as authorized by Rule 37(c)(1)(A). 
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In summary, Kriss’ motion to exclude [DE 41] is GRANTED in part, in that the Court 

will reopen discovery for the limited purpose of allowing Kriss to conduct reasonable follow-up 

discovery into the Modified PO, and will require CCT to reimburse Kriss for the reasonable 

expenses it incurs in conducting that discovery. Kriss is ORDERED to file a notice, by April 11, 

2016, itemizing the reasonable expenses it expects to incur through that discovery. CCT may file 

any response by April 18, 2016. The Court will then approve the reasonable expenses and reopen 

discovery for this limited purpose unless CCT chooses to withdraw the document. Kriss is also 

ORDERED to submit an accounting of the reasonable attorneys’ fees it incurred in bringing this 

motion, by April 11, 2016, with any response by CCT due April 18, 2016. 

 SO ORDERED. 

 ENTERED: March 31, 2016 

 /s/ JON E. DEGUILIO 

 Judge 

 United States District Court