COR Clearing, LLC v. Calissio Resources Group, Inc.
8:15-cv-00317
D. Neb.Jun 9, 2017Background
- COR Clearing, LLC sued Calissio Resources Group, Adam Carter, Signature Stock Transfer, and later added four clearing firms (NFS, TDAC, E-Trade, Scottrade) alleging a scheme that exploited DTCC dividend handling and seeking declaratory relief, unjust enrichment, and fraud.
- Early proceedings: default entered against Calissio; various motions to dismiss denied; COR served discovery and moved to compel certain 30(b)(6) testimony and document production from the Clearing Firm Defendants.
- COR sought testimony on compensation/float revenues, prior handling of fraudulent dividends, customer-acquisition/goodwill costs, and reversals/communications with DTCC (multiple RFPs across two sets).
- The Clearing Firm Defendants objected broadly as overbroad, burdensome, proprietary, and irrelevant; NFS and E-Trade additionally argued scope/search burdens for older materials.
- The dispute reached the court on COR’s motion to compel; the court analyzed relevance under Fed. R. Civ. P. 26(b)(1) and balanced burden and scope for each topic/RFP.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 30(b)(6) Topic 2 (compensation, float, revenue) & RFPs 10-11 (First Set), RFP 2 (Second Set) | Revenue/float info relevant to unjust enrichment and possible defendant enrichment from disputed payments | Overbroad, burdensome, seeks proprietary business data and customer financials | Granted — COR showed relevancy; defendants failed to justify objections |
| 30(b)(6) Topic 18 (handling of fraudulent dividends) & RFP 9 (Second Set) — NFS and E-Trade only | Prior handling shows reasonableness of responses and ability to prevent fraud | Overbroad, vague, burdensome, wide custodian/time search | Granted but narrowed — limited to matters brought to in-house legal departments from Jan 1, 2014 to present |
| 30(b)(6) Topic 41 (customer goodwill/acquisition costs) & RFP 25 (Second Set) | Costs/marketing/acquisition bear on damages or mitigation | Too vague, overbroad, not sufficiently tied to claims | Denied — defendants met burden showing vagueness and overbreadth |
| 30(b)(6) Topic 42 (impact on acquisition/retention/etc.) & RFP 26 (Second Set) | Impact evidence relevant to damages and defenses | Too vague, overbroad, proportionality concerns | Denied — same reasoning as Topic 41 |
| RFPs 15 & 18 (First Set) — reversals of due bill credits and communications with DTCC (2011–present) | Relevant to authority/ability to reverse credits and show corrective practices | Overbroad, burdensome, and not required absent regulatory/judicial directive | Granted — COR showed relevancy; defendants did not sufficiently justify refusal |
Key Cases Cited
- Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340 (1978) (discovery construed broadly to include any matter that reasonably could lead to admissible evidence)
- Hickman v. Taylor, 329 U.S. 495 (1947) (discovery has ultimate and necessary boundaries)
- Hayden v. Bracy, 744 F.2d 1338 (8th Cir. 1984) (district courts have discretion in discovery relevance determinations)
- In re Sealed Case (Medical Records), 381 F.3d 1205 (D.C. Cir. 2004) (courts may limit discovery after balancing competing interests)
- St. Paul Reinsurance Co., Ltd. v. Commercial Financial Corp., 198 F.R.D. 508 (discussing resisting party burden to show requests are overly broad or oppressive)