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Hansen v. Combined Transport, Inc.

United States District Court, D. Oregon, Medford Division

May 8, 2014

CHRIS HANSEN, Plaintiff,
v.
COMBINED TRANSPORT, INC., Defendant.

ORDER

MARK D. CLARKE, Magistrate Judge.

Plaintiff Chris Hansen brings various employment and contract related claims against the defendant Combined Transport, Inc., ("Combined Transport") based on Oregon and Washington state law. This Court has jurisdiction under 28 U.S.C. ยง 1332. The case comes before the Court on the defendant's motions for relief, imposition of sanctions, and disqualification of counsel (#32, #53, #57), discovery motions (#36), and motion for leave to file an amended answer (#49). Also at issue is Plaintiffs motion to compel (#52). The motions are granted and denied as discussed below.

BACKGROUND

Plaintiff Chris Hansen began his employment with the defendant, Combined Transport, in June, 2011. At that time, the parties entered into a Letter of Agreement, stating the terms of Plaintiffs employment, as well as a Non-Solicitation Agreement. The Letter of Agreement provided, in part, that Combined Transport would pay Plaintiff "a salary of $5, 800 per month with a bonus of no less than 1% on loads hauled by Combined [Transport]'s equipment and 2% on loads that are brokered." The Non-Solicitation Agreement provided, in part, that for two years after his employment terminated, Plaintiff would not solicit or do business with any customers that were "exclusive" customers of Combined Transport as of June, 2011.

Nearly two years later, in April, 2013, Plaintiff's employment with Combined Transport was terminated. The facts surrounding Plaintiff's termination are disputed by the parties. For instance, Plaintiff claims that Combined Transport's General Manager, Tony Keller, asked him what he felt he was owed for his bonuses, and what it would take to "get out of the Letter of Agreement." Plaintiff claims that he then asked Pam Hurley, another Combined Transport employee, to prepare reports for him, which he intended to use to calculate the bonuses owed. Ms. Hurley, currently still an employee at Combined Transport, submitted a declaration denying that such a conversation took place. Regardless, it is undisputed that certain documents belonging to Combined Transport were in Plaintiffs possession after he was terminated. It is also undisputed that Keller sent letters to Plaintiff and Plaintiff's attorneys requesting the return of all Combined Transport's equipment, records, notes, documents, and other proprietary items and information, as provided in the Letter of Agreement.

On April 12, 2013, Plaintiff met with his attorney, John Kreutzer, and turned over the various documents he had in his possession relating to Combined Transport. These documents were place into a binder labelled "client documents." On April 18, Mr. Kreutzer received from Plaintiff a series of PDF's via email, which contained a 582-page report. The report contained a customer list, labelled by Combined Transport, "New Customer Report." Mr. Kreutzer states that due to his own error, and possibly that of his staff, this report was not placed into the client documents binder; instead a separate binder was created. The next day, April 19, 2013, Plaintiffs attorney sent Mr. Keller a letter, which stated, "Attached are Combined documents that were in Mr. Hansen's possession that are now being returned to you." The letter also indicated that Mr. Hansen himself did not retain copies or electronic files of those documents. However, it now appears that the 582-page New Customer Report was not included in the attachment to that letter. Mr. Kreutzer states that this was an unintentional omission by his office, probably due to the fact that the report was placed in a separate binder from the other client documents. There was no pending litigation at that time.

Besides the letters regarding the Combined Transport documents in Plaintiffs possession, the parties also exchanged correspondence regarding the bonuses due Plaintiff under the terms of the Letter of Agreement. After it became clear that the parties could not resolve their dispute over the bonuses, Plaintiff filed his Complaint in King County Superior Court in the state of Washington. The Complaint was served on the defendant on June 26, 2013, and the defendant then removed to federal court in the Western District of Washington (Dkt. # 1). The case was transferred to this Court on a motion to change venue on November 8, 2013 (Dkt. #23).

In September, 2013, the defendant received Plaintiffs Rule 26 Initial Disclosures, which identified "Customer Lists" under Rule 26(a)(1)(A)(ii). The actual 582-page New Customer Report, however, was not produced to the defendant until January, 2014, although Plaintiff counsel believed at the time that it had been produced back in April, 2013. Plaintiff claims he does not retain any copies of this report, and his attorneys retain one computer disk copy.

DISCUSSION

I. Motions for relief, sanctions, disqualification of counsel (#32, 53, 57) are denied.

The Plaintiff has submitted a declaration denying that he obtained the documents at issue in any improper way, and his attorneys have provided evidence that the New Customer Report was not immediately provided to defense counsel due to an unintentional error. Plaintiff counsel did disclose the report, the attorneys eventually produced it in its entirety, and they are willing to tum over the computer disk containing the only copy to defense counsel. Plaintiff counsel stated that the report was not examined, and it was not used in drafting Plaintiffs First Request for Production: Considering that portions of the report are likely discoverable in this litigation, and there is no evidence of bad faith or improper motive for not disclosing the document sooner, the defendant's motions regarding this report are denied: However, Plaintiff counsel shall return all copies to defense counsel, including the computer disk, immediately.

II. Defendant's motion to compel (#36) is granted in part and denied in part.

"Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense.... Relevant information need not be admissible at trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence." Fed.R.Civ.P. 26(b)(1). Under Rule 26, all such discovery is subject to restrictions imposed by the court to limit the frequency or extent of discovery if the court determines that "the discovery sought is unreasonably cumulative or duplicative, ...


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