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Sequel Capital, LLC v. Pearson

July 5, 2011

SEQUEL CAPITAL, LLC
v.
PEARSON, ET AL.



Name of Assigned Judge Sitting Judge if Other or Magistrate Judge Robert M. Dow, Jr than Assigned Judge

CASE TITLE

DOCKET ENTRY TEXT

For the reasons below, the Court denies Third Party Plaintiffs' motion to reset the briefing schedule on summary judgment [188].

O[ For further details see text below.] Notices mailed by Judicial staff.

STATEMENT

This case began in state court in 2004. In 2007, after an amended pleading added federal claims, the case was removed to federal court. During the course of both the state and federal phases of the litigation, the assigned judges have given the parties considerable latitude in regard to their attempts to frame their claims. Of particular note in that regard is the fact that Third Party Plaintiffs William Pearson and Argus Industries, Inc. have been given five opportunities (an original and four amended complaints) to attempt to state a claim against Third Party Defendants Rally Capital Services, Inc. and Howard Samuels (collectively, the "Rally Defendants").

The most recent iteration of Third Party Plaintiffs' claims was filed in February 2010. The Court granted in part the Rally Defendants' motion to dismiss that fourth amended complaint in September 2010 [see 144]. As the Rally Defendants note [see 173, at 7], the claim that remains against them is whether they breached a fiduciary duty in connection with Defendant Samuels's service as acting Assignee following the sale of the Argus assets to Hartford on July 15, 2003. The Rally Defendants filed a motion for summary judgment on that claim [see 171] in January 2011.

In March 2011, the Rally Defendants filed a motion for decision [179]. In that motion, they took the position that Third Party Plaintiffs' failure to respond to the summary judgment motion within the time period provided in the Federal Rules should be deemed as a forfeiture of the opportunity to respond and that the Court should proceed to decision on the motion without the benefit of a brief from Third Party Plaintiffs. At the March 15 motion hearing, the Court rejected that contention and directed the parties to submit a joint status report with a proposed schedule for any discovery required by Third Party Plaintiffs prior to responding to the summary judgment motion and for briefing of the motion itself. [See 181.]

In response to the Court's directive, the parties conferred and submitted a joint status report [184] in which they reported that by agreement Mr. Samuels would be deposed on April 18, 2011 and requested a briefing schedule pursuant to which Third Party Plaintiffs would respond by May 27, 2011 and the Rally Defendants would reply by June 17, 2011. The Court adopted the agreed briefing schedule in a minute order dated April 5, 2011 [see 185].

Regrettably, the May 27 deadline came and went without the filing of either a response brief or a motion seeking an extension of the agreed deadline. A few days later, on June 2, the Rally Defendants filed a "reply" brief [186] in which they observed that (1) the deposition did not go forward and (2) the response brief had not been filed.

It was not until more than two weeks later -- on June 17 -- that Third Party Plaintiffs placed on file a motion to reset the briefing schedule [188]. In that motion, Third Party Plaintiffs belatedly requested the extension on the grounds that counsel had been preparing for an oral argument that took place in New York on May 10 and that the client had been behind on payment to counsel for several months. Third Party Plaintiffs asked for 21 additional days to complete the deposition of Mr. Samuels (if it could be accomplished in that time frame) and to file their response brief.

The motion was noticed for presentment on June 29, 2011. Counsel for all parties except Third Party Plaintiffs (the moving party) were present. On behalf of his clients, counsel for the Rally Defendants expressed his clients' opposition to the motion. The Court took the matter under advisement.

Federal Rule of Civil Procedure 6(b) grants courts authority both to establish filing deadlines and to enforce them. FED. R. CIV. P. 6(b); see also Raymond v. Ameritech Corp., 442 F.3d 600, 605 (7th Cir. 2006) (citing Reales v. Consol. Rail Corp., 84 F.3d 993, 996 (7th Cir. 1996)). "[C]court-imposed deadlines are no less binding merely because they have passed," and a court therefore is well within its discretion to deny a request to extend a deadline that has already passed. Raymond, 442 F.3d at 606. "The overriding principle at stake involves the district court's ability to mitigate the scourge of litigation delays by setting deadlines 'to force parties and their attorneys to be diligent in prosecuting their causes of action.'" Id. at 606-07 (quoting Spears v. City of Indianapolis, 74 F.3d 153, 157-58 (7th Cir. 1996)).

After careful review of all of the relevant circumstances in this case, the Court concludes that Third Party Plaintiff's motion should be denied. In reaching that determination, the Court is guided by several considerations. To begin with, the third party dispute has grown long in the tooth, and the record reflects a fairly consistent pattern of indulging Third Party Plaintiffs through multiple amendments of the pleadings and extensions of deadlines. In addition, the most recent scheduling order was set by agreement of the parties. It provided ample time to complete the anticipated deposition and the briefing of a straightforward, single-issue motion for summary judgment. At the time that those dates were agreed, proposed, and adopted, both lawyer and client on the Third Party Plaintiff side presumably were on board with the schedule. Furthermore, to the extent that circumstances arose that may have justified the alteration of that recently adopted schedule, the appropriate time for seeking the ...


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