United States District Court, N.D. Illinois, Eastern Division
PALDO SIGN AND DISPLAY COMPANY, an Illinois corporation, and SABON, INC., a Florida corporation, individually and as representatives of a class of similarly-situated persons, Plaintiffs,
UNIFIED MARKETING, LLC, et al., Defendants.
MEMORANDUM OPINION AND ORDER
L. ALONSO United States District Judge
the Court are four motions. For the reasons explained below,
the motions of defendants j2 Global Canada, Inc. and j2
Global, Inc. (the “j2 Defendants”) for summary
judgment [147, 150] are granted; plaintiffs' motion to
strike declarations and portions of defendants' motions,
memoranda, and fact statements; to bar certain evidence; and
to set a briefing schedule on class certification  is
granted in part and denied in part; and the j2
Defendants' motion to strike portions of plaintiffs'
memorandum in opposition to defendants' motions and
statement of additional facts  is denied.
a single-count putative class action under the Telephone
Consumer Protection Act, 47 U.S.C. § 227
(“TCPA”), in which plaintiffs, Paldo Sign and
Display Company (“Paldo”) and Sabon, Inc.
(“Sabon”) allege that they received junk faxes
that did not display a proper opt-out notice as required.
Paldo alleges that on September 28, 2009, it was sent an
unsolicited fax that advertised a “limited time
offer” for a “free” “brand new
combination snack & soda vending machine.” (ECF No.
71, Second Am. Class Action Compl. ¶¶ 28, 32 &
Ex. A.) Sabon alleges that it was sent a nearly identical
unsolicited fax on May 23, 2011. (Id. ¶¶
29, 32 & Ex. B.) The operative complaint, the Second
Amended Complaint, names the following defendants: Unified
Marketing, LLC (“Unified Marketing”); United
Vending and Marketing, Inc. (“United Vending”);
Sunrise Marketing & Vending, Inc.
(“Sunrise”); Global Vending Services Inc.
(“Global Vending”); Matthew A. Capicchioni;
Nicholas G. Chomakos; Laura E. Chomakos (all of whom
plaintiffs collectively call the “Vending Machine
Advertisers”); Accelero Communications, Inc.
(“Accelero”); Digitalspeed Communications, Inc.
(“Digitalspeed”); Slingshot Technologies
Corporation (“Slingshot”); j2 Global, Inc.
(“j2 Global”); j2 Global Canada, Inc. (“j2
Canada”); Tyler Eyamie; and John Does 1-10.
plaintiffs have not filed a return of service as to Unified
Marketing, United Vending, Sunrise, Global Vending, or
Matthew A. Capicchioni, it appears that those defendants have
been served. The parties stated in a joint status report that
Capicchioni was served but has not appeared. (ECF No. 124 at
2.) Unified Marketing, United Vending, Sunrise, and Global
Vending are entities affiliated with the Chomakoses, who are
proceeding pro se. No attorney has entered an appearance on
behalf of those entities. Judge Darrah, to whom this case was
previously assigned, dismissed Eyamie for lack of personal
jurisdiction. (ECF No. 104.) After the case was reassigned to
this Court, plaintiffs voluntarily dismissed Accelero,
Digitalspeed, and Slingshot. (ECF Nos. 132 & 134.)
j2 Global and j2 Canada filed motions for summary
judgment, which are now before the Court. Both sides have
filed motions to strike certain evidence submitted in
connection with the summary judgment motions; the Court first
will address the motions to strike.
Plaintiffs' Motion to Strike
ask the Court to strike the declarations of David Allen
Tough, David Guerrero, and Teruko Furuya (the
“Declarants”)-which the j2 Defendants submitted
in support of their motions for summary judgment-as well as
“all portions” of defendants' motions,
memoranda in support, and Local Rule 56.1 Statements that
rely on those declarations. (ECF No. 153, Pls.' Mot.
Strike 1.) Plaintiffs contend that defendants should not be
permitted to use the evidence the Declarants supply because
defendants did not previously disclose them as potential
witnesses. Plaintiffs also seek to strike “untimely
produced documents.” (Id.)
Rule of Civil Procedure 26 requires a party to provide to the
other parties “the name and, if known, the address and
telephone number of each individual likely to have
discoverable information-along with the subjects of that
information-that the disclosing party may use to support its
claims or defenses, unless the use would be solely for
impeachment.” Fed.R.Civ.P. 26(a)(1)(A)(i). A party who
has made a Rule 26(a) disclosure must supplement that
disclosure “in a timely manner if the party learns that
in some material respect the disclosure or response is
incomplete or incorrect, and if the additional or corrective
information has not otherwise been made known to the other
parties during the discovery process or in writing.”
Fed.R.Civ.P. 26(e)(1)(A). To ensure compliance with these
requirements, Rule 37(c)(1) provides that 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.” Preclusion is
“automatic and mandatory” unless “the
offending party can establish that its violation of Rule
26(a)(2) was either justified or harmless.” Ciomber
v. Coop. Plus, Inc., 527 F.3d 635, 641 (7th Cir. 2008)
(internal quotation marks omitted). “In addition to or
instead of” preclusion, the court may order other
sanctions. Fed.R.Civ.P. 37(c)(1). “Whether a failure to
comply with Rule 26(a) or (e) is substantially justified,
harmless, or warrants sanctions is left to the broad
discretion of the district court.” Dynegy Mktg.
& Trade v. Multiut Corp., 648 F.3d 506, 514 (7th
undisputed that the j2 Defendants never identified Tough,
Guerrero, or Furuya as individuals who were likely to have
discoverable information. The j2 Defendants contend, however,
that they had no duty to supplement their Rule 26 disclosures
because the Declarants were otherwise made known to
plaintiffs before the close of discovery. Tough and Guerrero
were the individuals who verified, respectively, j2 Canada
and j2 Global's supplemental responses to
interrogatories. (ECF Nos. 153-6 & 153-8.) As for
Furuya, defendants state that it is “unclear”
whether plaintiffs knew about her prior to the submission of
her declaration in connection with the summary judgment
motions, but they argue that she is “simply a j2
representative testifying in her corporate capacity”
and the information contained in her declaration already
became known to plaintiffs during the discovery process. (ECF
No. 171, Defs.' Mem. Opp'n Pls.' Mot. Strike
8-9.) Even if they did have a duty to supplement, say
defendants, plaintiffs have failed to demonstrate a lack of
substantial justification or that they suffered any harm from
the failure to disclose the Declarants. Alternatively,
defendants suggest, any harm could be cured by allowing
plaintiffs to depose the Declarants regarding the statements
concede that Tough and Guerrero verified defendants'
supplemental interrogatory responses but emphasize that
defendants tendered those responses as well as certain j2
Canada documents on January 11, 2016, the last day of the
discovery period. According to plaintiffs, those disclosures
were untimely. (ECF No. 181, Pls.' Reply Supp. Mot.
Strike 2, 9-10.) The Court disagrees. Plaintiffs knew within
the discovery period that Tough and Guerrero were individuals
with information responsive to their interrogatories.
Moreover, j2 Canada produced the documents at issue within
the discovery period. Yet plaintiffs did not follow up on
these matters, seek to extend the discovery period in an
effort to depose Tough or Guerrero, or file any discovery
motion despite the fact that they now complain broadly about
defendants' discovery responses and “substantial
and irreparabl[e]” prejudice. This Court held a status
hearing on January 21, 2016, during which plaintiffs'
counsel did not raise any discovery concerns and in fact
affirmed that discovery was closed and indicated that the
next step after settlement discussions would be to set a
briefing schedule on j2 Global's anticipated motion for
summary judgment. (ECF No. 186, Tr. of 1/21/16 Hr'g 3.)
The Court therefore set such a briefing schedule.
Court further notes that despite having been on notice
through the j2 Defendants' Rule 26(a)(1) disclosures that
defendants would rely on unnamed corporate representatives
and employees who had knowledge of defendants' relevant
business practices and policies and extent of involvement in
the transmission of faxes, plaintiffs never sought a Rule
30(b)(6) deposition of a j2 representative. Consequently,
plaintiffs' claims of prejudice ring hollow. See
Physicians Healthsource, Inc. v. Allscripts Health Sols.,
Inc., No. 12 C 3233, 2016 WL 7034074, at *4 n.9 (N.D.
Ill.Dec. 2, 2016) (“[I]nferences from silence are often
perilous. But not always in a context where some prompt
outcry would be expected. If the plaintiff truly was
handicapped by not having names of those who it was claimed
had agreed to receive faxes, it is doubtful that it would
have said nothing and proceeded through discovery.”);
Krawczyk v. Centurion Capital Corp., No. 06 C 6273,
2009 WL 395458, at *6 (N.D. Ill. Feb. 18, 2009) (“Any
prejudice to Plaintiff resulted from not conducting his own
discovery with respect to Defendants' witnesses, not from
Defendants' bad faith or willfulness in failing to
specify the names of the representatives whom they intended
to use.”). It is telling that plaintiffs do not invoke
Federal Rule of Civil Procedure 56(d) or contend that the
Court should reopen discovery to allow them to obtain facts
essential to justify their opposition, but rather simply move
to strike the declarations of Tough, Guerrero, and Furuya and
urge the Court to “reject Defendants'
‘offer' to reopen discovery.” (Pls.'
Reply Supp. Mot. Strike 14.)
it was made known to plaintiffs within the discovery period
that Tough and Guerrero possessed relevant information and
plaintiffs had a fair opportunity to ask the Court to allow
additional discovery from them prior to the filing of
defendants' summary judgment motions (and prior to the
Court's setting a briefing schedule), as well as a fair
opportunity to seek follow-up discovery on the j2 Canada
documents, the Court will not strike Tough or Guerrero's
declarations, bar them from testifying, bar use of the j2
Canada documents, or strike the portions of defendants'
statements, motions, and memoranda that rely on these
declarations or documents. See Gutierrez v. AT&T
Broadband, LLC, 382 F.3d 725, 732-33 (7th Cir. 2004)
(where defendants submitted an affidavit in support of their
summary-judgment motion and plaintiffs had known prior to the
close of discovery about the affiant and that she had
relevant information, the district court did not abuse its
discretion in denying plaintiffs' motion to strike the
contrast with Tough and Guerrero, Furuya was not made known
to plaintiffs before the close of discovery. And the Court is
not persuaded that it should excuse defendants' failure
to disclose her as a potential witness on the ground that she
is “simply” a corporate representative of j2
whose declaration consists of information of which defendants
say plaintiffs are aware. The issue is not whether plaintiffs
already knew generally of the information contained in her
declaration, but whether plaintiffs were on notice that
Furuya had relevant information. See, e.g.,
Gutierrez, 382 F.3d at 733-34. They were not.
Furthermore, defendants misstate the burden when they assert
that plaintiffs have failed to demonstrate a lack of
substantial justification or that they suffered any harm from
the failure to disclose Furuya. It is
defendants' burden to show that their failure to
disclose Furuya was either justified or harmless. See
Ciomber, 527 F.3d at 641. Defendants rely only upon the
latter. To evaluate harmlessness, the Court considers the
following factors: “(1) the prejudice or surprise to
the party against whom the evidence is offered; (2) the
ability of the party to cure the prejudice; (3) the
likelihood of disruption to the trial; and (4) the bad faith
or willfulness involved in not disclosing the evidence at an
earlier date.” See David v. Caterpillar, Inc.,
324 F.3d 851, 857 (7th Cir. 2003).
argue that plaintiffs are not prejudiced by the use of
Furuya's declaration because plaintiffs “already
deposed all of the key witnesses with personal knowledge
relating to the transactions at issue” and they chose
not to depose any j2 witnesses other than Eyamie. (Defs.'
Mem. Opp'n Pls.' Mot. Strike 11.) These arguments
miss the point. j2 Global uses Furuya's testimony about
defendants' corporate structure to support its motion,
and her identity was never disclosed prior to the filing of
defendants' summary-judgment motions. Plaintiffs were
prejudiced because they were not put on notice that Furuya
possesses information pertinent to the case such that they
would be expected to request her deposition or anticipate the
use of her declaration in support of summary judgment. It
matters not that defendants believe plaintiffs should have
taken other depositions or that Furuya is not a
defendants failed to disclose Furuya as a potential witness,
her identity as a potential witness was not otherwise made
known to plaintiffs during the discovery process, and
defendants have failed to show that the failure to disclose
her was substantially justified or harmless, the Court
strikes her declaration. But the Court denies as unnecessary
plaintiffs' request to strike those portions of
defendants' summary-judgment materials that rely solely
on Furuya's declaration. As discussed below, the Court is
not an editor and has not relied on Furuya's declaration
in deciding the instant motions.
also ask the Court to 1) strike the defendants' motions
for summary judgment for failure to timely disclose the
Declarants; 2) bar the Declarants from offering evidence or
participating in this litigation; and 3) set a briefing
schedule on plaintiffs' anticipated motion for class
certification. The Court denies each request. Striking
Furuya's declaration itself is a sanction commensurate
with the failure to disclose her, but striking
defendants' motions would be highly disproportionate.
There is no ripe controversy as to plaintiffs' second
request because defendants do not seek at this time to use
the Declarants to offer any additional testimony in this
litigation. As to the third request, there is no pending
motion for class certification, so the Court will cross the
scheduling bridge when it comes to it.
Defendants' Motion to Strike
Defendants ask the Court to strike certain portions of
plaintiffs' Local Rule 56.1 statement of additional
facts; corresponding portions of plaintiffs' memorandum
in opposition to defendants' summary judgment motions;
and several of plaintiffs' exhibits. Essentially,
defendants seek to have the Court carve out what they deem to
be objectionable or unpersuasive portions of plaintiffs'
summary judgment materials. Defendants' motion itself
(quite aside from the thirteen-page supporting memorandum)
contains a ten-page detailed list of portions defendants seek
to have stricken. This sort of motion to strike is
particularly disfavored, see Custom Vehicles, Inc. v.
Forest River, Inc., 464 F.3d 725, 726 (7th Cir. 2006),
and “waste[s] time by requiring judges to engage in
busywork and judicial editing without addressing the merits
of a party's claim, ” U.S. Bank Nat'l
Ass'n v. Alliant Energy Res., Inc., No.
09-cv-078-bbc, 2009 WL 1850813, at *3 (W.D. Wis. June 26,
2009). “The way to point out errors in an
[opponent's] brief is to file a reply brief, not to ask a
judge to serve as editor. . . . The judiciary has quite
enough to do deciding cases on their merits.”
Custom Vehicles, 464 F.3d at 726. Defendants'
motion does little to advance the ball in this litigation and
is therefore denied. To the extent necessary, the Court will
address within its discussion of the summary judgment motions
the materials to which defendants object.
complaint sets out two time frames during which the Vending
Machine Fax was allegedly unlawfully transmitted. Plaintiffs
allege that the j2 Defendants are responsible for the
transmission of the subject junk faxes from 2009 through
2011; this time period includes the fax allegedly sent to
Paldo. For purposes of the instant motions, plaintiffs do not
dispute that the fax allegedly sent to Sabon in 2011 was sent
by an entity other than the j2 Defendants, nor do they
dispute that the statute of limitations bars recovery for any
faxes sent prior to January 18, 2009. (ECF No. 162, Pls.'
Mem. Opp'n Defs.' Mots. Summ. J. 2 n.2.)
Canada is a wholly-owned subsidiary of j2 Global, with
multiple layers of subsidiaries between them. j2 Canada
provides communications services, including web-based
facsimile broadcasting, which it defines as a “means
through which a customer can transmit a single facsimile to
multiple destinations.” (ECF No. 156, Pls.' Resp.
j2 Canada's LR 56.1(a)(3) Stmt. ¶ 4.) j2 Canada was
formerly known as Protus IP Solutions, Inc.
(“Protus”) until an indirect subsidiary of j2
Global acquired Protus in December 2010. Taking its cue from
the parties, the Court will refer to j2 Canada and Protus
interchangeably throughout this opinion (with exception of
the discussion below regarding the Protus Lawsuit).
Nicholas Chomakos is or was the owner and/or president of
defendants Unified Marketing, United Vending, Sunrise, and
Global Vending (collectively, “Chomakos”).
Chomakos was in the business of installing vending machines
for clients who owned such machines. When a client contacted
Chomakos about placing a vending machine, Chomakos then sent
a fax (the “Vending Machine Fax” or
“Fax”) to businesses within a certain geographic
area that might want a vending machine located at their place
of business, free of charge. For each vending machine
placement, Chomakos's clients paid him a flat fee of $200
to $300. Chomakos began sending the Fax in 2004. He, along
with non-parties Yuriy Mirskiy and another individual,
created its content.
between 2007 and early 2009, Chomakos began exclusively using
Mirskiy to send the Fax and to provide fax numbers to which
to send it. Chomakos provided Mirskiy with zip codes of areas
he wished to target, and Mirskiy responded by telling him how
many fax numbers he “had” in those designated
areas. Although Mirskiy arranged for the transmission of the
Fax, he never disclosed to Chomakos what entity he used to do
That entity was UnixUSA, LLC (“Unix”), which is
solely owned by an individual named Erol Sonmez. Unix, in
turn, used other companies' fax-broadcasting systems to
transmit faxes on behalf of its customers.
2005 through December 2010, Unix, through Sonmez, worked
almost exclusively with Protus and Eyamie to send faxes.
Eyamie was employed by Protus in 2009 and early 2010 as its
Manager of Business Development. In that capacity, Eyamie
served as a commissioned sales representative for Sonmez and
others. Eyamie handled customer inquiries, sold fax
broadcasting and fax reception services, and performed
various other duties, such as reporting on sales activities
and maintaining customer relationships. With respect to
Sonmez, Eyamie also handled billing matters, helped Sonmez
obtain credit and multiple account numbers, addressed
Sonmez's concerns about the speed with which his orders