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Hannah's Boutique v. Surdej

United States District Court, N.D. Illinois, Eastern Division

March 25, 2014

HANNAH'S BOUTIQUE, an Illinois corporation, Plaintiff,
v.
BARBARA ANN SURDEJ, ROY SURDEJ and JEFFREY SURDEJ d/b/a PEACHES BOUTIQUE and AGNIESZKA BIALAS, Defendants.

MEMORANDUM OPINION AND ORDER

AMY J. ST. EVE, District Judge.

In October 2013, the parties came before the Court with differing proposals for the scope of discovery. ( See R. 99, Joint Discovery Plan.) Defendants sought to limit the initial phase of discovery to the issue of market power and to set restrictions on third-party discovery and the number of depositions for each side. ( Id. at 2-5.) Plaintiff, on the other hand, proposed that the parties conduct discovery on all issues simultaneously. ( Id. at 6-7.) The Court ultimately adopted a middle-ground discovery plan that prioritized discovery on market power and allowed Defendants to move for summary judgment on the issue of market power at an early stage in the discovery process, but rejected Defendants' proposed limitations on the scope of third-party discovery and the number of depositions. ( See R. 101.)

Since the Court's ruling, the parties have continued to argue over discovery. On December 30, 2013, Plaintiff filed a motion to compel Defendants to provide further responses to its discovery requests, which the Court granted in part and denied in part on January 29, 2014. Recently, the parties filed several additional discovery motions. Currently before the Court are (1) Plaintiff's motion for issuance of a rule to show cause and to bar Defendants from raising certain defenses or presenting certain evidence due to Defendants' failure to comply with the Court's order on Plaintiff's earlier motion to compel ( see R. 123); (2) Plaintiff's motion to strike or remove Defendants' designation of documents as "Confidential" and "Attorney's Eyes Only" under the Agreed Confidentiality Order ( see R. 125); and (3) Defendants' motion to compel Plaintiff to produce documents in response to Defendants' non-market power discovery requests ( see R. 130).[1] For the following reasons, the Court grants in part and denies in part Plaintiff's motions, and denies Defendants' motion as moot in light of Plaintiff's agreement to produce the requested documents within twenty-one days.

LEGAL STANDARD

The Federal Rules of Civil Procedure allow liberal discovery to assist in preparation for trial and settlement of disputes. See Bond v. Uteras, 585 F.3d 1061, 1075 (7th Cir. 2009). Federal Rule of Civil Procedure 26(b)(1) provides that "[p]arties may obtain discovery regarding any non-privileged matter that is relevant to any party's claim or defense. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence." Fed.R.Civ.P. 26(b)(1). "The burden rests upon the objecting party to show why a particular discovery request is improper." Kodish v. Oakbrook Terrace Fire Prot. Dist., 235 F.R.D. 447, 450 (N.D. Ill. 2006). This burden "is not satisfied by a reflexive invocation of the same baseless, often abused litany that the requested discovery is vague, ambiguous, overly broad, unduly burdensome, or that it is neither relevant nor reasonably calculated to lead to the discovery of admissible evidence.'" Osada v. Experian Info. Solutions, Inc., 290 F.R.D. 485, 494 (N.D. Ill. 2012) (citation omitted).

As with all discovery motions, district courts have broad discretion in deciding motions to compel. See James v. Hyatt Regency Chicago, 707 F.3d 776, 784 (7th Cir. 2013). A district court may grant or deny a motion to compel in whole or in part and, "similar to ruling on a request for a protective order under Rule 26(c), the district court may fashion a ruling appropriate for the circumstances of the case." Gile v. United Air Lines, Inc., 95 F.3d 492, 496 (7th Cir. 1996). District courts also have broad discretion in deciding "whether and how to sanction [discovery] misconduct, for they are much closer to the management of the case and the host of intangible and equitable factors that may be relevant in exercising such discretion." Hunt v. DaVita, Inc., 680 F.3d 775, 780 (7th Cir. 2012).

ANALYSIS

I. Plaintiff's Motion for Issuance of a Rule to Show Cause and to Bar Defenses and Evidence

A. Background

Plaintiff's motion for issuance of a rule to show cause and to bar defenses and evidence concerns Defendants' failure to comply with the Court's ruling on Plaintiff's previous motion to compel further responses to its interrogatories. Specifically, Plaintiff argues that Defendants' supplemental response to Interrogatory No. 14 of Plaintiff's First Set of Interrogatories to Defendant Surdej is deficient.[2] ( See R. 123, Pl. Mot. for Rule to Show Cause ΒΆΒΆ 9-13.) Interrogatory No. 14 requested Defendants to

[i]dentify any and all contracts and/or agreements between Defendants and/or Peaches' Employees and any of the Designers and/or their Independent Sales Representatives regarding Peaches' exclusive right to sell Women's Fashion Dresses anywhere within the Chicago Market, including the date of the agreement, the terms of the agreement, the geographic scope or area of the agreement, and the length of the agreement.

( See Pl. Mot. for Rule to Show Cause at Ex. C, Roy Surdej's Second Supp. Interrog. Resp., at 14.) Defendants' initial response to Interrogatory No. 14 stated, in relevant part:

[T]o provide uniqueness for its product mix and to maintain its ability to offer its customers reasonable confidence that someone else at the event that customer is attending will not be wearing the same dress, it is not uncommon for Peaches to request that a Designer from which it purchases special occasion dresses elect whether to sell to Peaches or another retailer on a going-forward basis. There is no set geographical area for such requests, which are determined on a case-by-case basis, and varies [sic] on a number of factors including, inter alia, the time period, the Designer, and the volume of dresses that Peaches purchases from the Designer.

( See R. 111-2, Roy Surdej's Initial Interrog. Resp. at 13-14.)

On January 29, 2014, the Court ordered Defendants to supplement their response to Interrogatory No. 14 in two respects. First, the Court ordered that if, as Defendants' counsel represented in court, no contracts or written agreements with designers or independent sales representatives reflecting Peaches' exclusive right to sell their dresses exist, Defendants should state that in their response to Interrogatory No. 14 and swear to and verify their responses. ( See R. 122, Jan. 29, 2014 Hrg. Tr. at 12-13.) Second, the Court ordered Defendants to identify any oral agreements of which they are aware and provide the requested information about the agreements-"the who, when, terms, et cetera"-to the extent they could ...


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