Pryde v. United States
15-878
| Fed. Cl. | May 25, 2017Background
- This is a tax-refund case before the U.S. Court of Federal Claims with a February 11, 2016 Scheduling Order setting a fact-discovery deadline of September 9, 2016.
- Plaintiffs' counsel repeatedly disclosed (and then changed) which fact witnesses would be called after the discovery cutoff: notifications occurred Sept. 12, Sept. 14, and Dec. 8, 2016. Some witnesses had been listed in initial disclosures but later represented as not to be called, then reintroduced.
- The government repeatedly sought and obtained reopenings of fact discovery to depose additional witnesses, resulting in a roughly seven-month delay and additional expenses.
- The government sought sanctions/recovery of reasonable expenses (travel, court-reporter fees, attorney fees, and expert fees) under RCFC 16(f) for plaintiffs’ counsel’s noncompliance.
- The Court found plaintiffs’ counsel’s conduct not substantially justified, granted recovery of a portion of the government’s reasonable expenses, ordered plaintiffs’ counsel to pay one-quarter of specified deposition-related travel, court-reporter, and attorney fees, and held the government’s request for expert-fee reimbursement in abeyance.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether court may sanction for failure to obey scheduling order | Plaintiffs argued additional witnesses had been disclosed in initial disclosures | Government argued plaintiffs’ late witness notifications repeatedly violated scheduling order, causing delay and expense | Court: RCFC 16(f) authorizes sanctions; enforcement proper |
| Whether plaintiffs’ noncompliance was "substantially justified" | Plaintiffs contended initial disclosures included some witnesses (implying justification) | Government emphasized repeated, unexplained late notifications and seven-month delay | Court: Noncompliance not substantially justified; no genuine dispute |
| Whether government may recover reasonable expenses caused by noncompliance | Plaintiffs opposed shifting costs | Government sought travel, court-reporter, attorney, and expert fees tied to reopened discovery | Court: Government may recover reasonable deposition-related travel, reporter, and attorney fees; ordered one-quarter payment by plaintiffs’ counsel; parties to stipulate amount |
| Recovery of anticipated expert fees | Plaintiffs opposed or disputed extent | Government requested recovery of anticipated expert reassessment fees | Court: Held expert-fee request in abeyance (anticipated costs not yet incurred); will decide after documentation or agreement |
Key Cases Cited
- Tracinda Corp. v. DaimlerChrysler AG, 502 F.3d 212 (3d Cir. 2007) (explains when noncompliance is "substantially justified" under Rule 16 and when fees may be imposed)
- Pacific Gas & Elec. Co. v. United States, 82 Fed. Cl. 474 (2008) (discusses court’s power to enforce scheduling orders and impose sanctions)
- Aloe Vera of Am., Inc. v. United States, 376 F.3d 960 (9th Cir. 2004) (recognizes a court’s inherent powers to manage cases and ensure obedience to orders)