Opinion
MDL NO. 1087 and Master File No. 95-1477
July 19, 2000
THIS DOCUMENT RELATES TO ALL ACTIONS
ORDER
This matter is before the Court on Class Plaintiffs' Motion for Order to Require Defendants to Supplement Responses to Certain Interrogatories. For the reasons stated herein, the Motion is GRANTED IN PART and DENIED IN PART.
Background
On April 18, 1996, Class Plaintiffs served their Second Request to All Defendants for Production of Documents. (Plt. Ex. 1). Request No. 2 of that set sought:
For the period January 1, 1984 to date, for HFCS and glucose documents sufficient to show (in the most efficient and economic way) all transaction prices.
(Plt. Ex. 1 at 6). Request No. 3 sought:
For the end of each calendar quarter and year within the relevant period, for each of your plants which manufactures or manufactured HFCS, all documents sufficient to show:
(a) production capacity;
(b) the level of production during the preceding year or quarter.
(Id.). Request No. 8 sought, in part:
All profit and loss, income statements, . . . and other similar documents . . . whether prepared monthly, quarterly or at other intervals, of each plant, department, division or unit which manufactured or sold HFCS. . . .
(Id. at 8). Request No. 14 sought, in part:
All documents relating to any of your HFCS competitors or potential competitors, including, but not limited to:
(a) production or production capacity; . . .
(Id. at 9). The discovery request further provided:
All requests herein refer to the period of time from January 1, 1987, to the date of this request, [April 18, 1996,] . . . unless otherwise stated. . . .
(Id. at 5) (emphasis added).
On June 14, 1996, Defendants, A.E. Staley Manufacturing ("Staley"), American Maize-Products Company ("American Maize"), and Cargill, Inc. ("Cargill"), responded, and on June 17, 1996, Defendant, Archer Daniels Midland Company ("ADM"), responded. (Plt. Ex. 2 through 5). Each Defendant objected to the time period of the request as too broad, and each objected to producing information concerning glucose, i.e., regular corny syrup, in response to Request No. 2. Defendants otherwise agreed to produce responsive documents to the request described above.
Class Plaintiffs subsequently moved to compel the production of, inter alia, data for the period of January 1, 1987, through June 30, 1996, documents for the period of January 1, 1988, through December 31, 1995, and information concerning regular corn syrup. The issue of the relevant time period for discovery was briefed and argued before the Magistrate Judge. In his Order, the Magistrate Judge held, in relevant part, that Defendants were to produce documents and answers to interrogatories for the time period of January 1, 1988, through December 31, 1995, and transaction data for the time period of January 1, 1987, through June 30, 1996. (Plt. Ex. 6 at 1).
On December 20, 1996, Class Plaintiffs served their Third Set of Interrogatories and Sixth Set of Document Requests to All Defendants. (Plt. Ex. 7). Interrogatory No. 6 asked, in relevant part:
For the first day of each calendar year and quarter for each plant at which you produced HFCS during the Relevant Period, state:
(a) the annual grind capacity at the plant;
(b) the daily grind capacity of the plant;
(c) the annual finishing capacity for each type of HFCS produced at the plant. . .; [and]
(d) the daily finishing capacity for each type of HFCS produced at the plant. . . .
(Plt. Ex. 7 at 11) (emphasis added). The discovery request further provided:
All information request is for the period from January 1, 1988 through December 31, 1995, except for the data relating to transactions for which the period is January 1, 1987 through June 30, 1986 (the "Relevant Period").
(Id. at 7). Each Defendant filed its answer to the discovery request by February 24, 1997. (Plt. Ex. 8, 10, 13, and 15).
On October 1, 1997, Class Plaintiffs served their Sixth Set of Interrogatories to All Defendants. (Plt. Ex. 22). Interrogatory No. 1, which was directed at Staley and Cargill, asked:
For each month of the Relevant Period, state the number of pounds of each type of HFCS sold.
(Id. at 4). The term "Relevant Period" was defined in this discovery request as "the period from January 1, 1986 through June 30, 1997." (Id. at 4). On October 31, 1997, Cargill responded. (Plt. Ex. 23). It objected to providing information for 1997 and listed the number of pounds of HFCS 42 and 55 it produced in each month from January, 1986, through October, 1997. (Id. at 2, 3 through 16). There is no indication in the record as to if and when Staley responded to Interrogatory No. 1 and if so whether Staley provided the requested data through June, 1997. Class Plaintiffs did not file a Motion to Compel either Cargill or Staley to provide the requested data through June, 1997. Cargill subsequently provided Class Plaintiffs on February 10, 1998, the new figures for the data requested in Interrogatory No. 1 for the time period of January, 1986, through December, 1996. According to Class Plaintiffs, Cargill's provision of these new figures was in response to Rausser's criticism of Cargill's data in his expert report.
In Class Plaintiffs Seventh Set of Document Requests to Certain Defendants (Plt. Ex. 26) and Eighth Set of Document Requests to Cargill (Exhibit 27), served September 5 and 9, 1997, respectively, Class Plaintiffs
[S]ought to expand the period for which they had received transaction data from the defendants from January 1, 1986 (rather than January 1, 1987) to June 30, 1997 (rather than June 30, 1996).
(Arenson Aff., ¶ 16). ADM, American Maize, and Cargill agreed to produce data for 1986, but refused to provide post-conspiracy data beyond December 31, 1996. (Plt. Ex. 28 through 30). Staley did not have any electronic data prior to October 1, 1987, and also refused to produce any data for that period of time beyond December 31, 1996. (Plt. Ex. 31). Class Plaintiffs did not seek an order from this Court compelling Defendants to produce data for that period of time after December 31, 1996, until it filed its current Motion.
Gregory K. Arenson is one of Class Plaintiffs' attorneys.
On March 19, 1998, Defendants' expert, Professor Christopher M. James, completed his Rule 26(a) expert report. Therein, he was critical of the regression analysis performed by Class Plaintiffs' expert, Professor Gordon C. Rausser. In his Rule 26(a) expert report, Professor Rausser presented a multivariate regression analysis to identify whether prices were higher in the alleged conspiracy period of January, 1989, through June, 1995, as compared to the pre and post-conspiracy periods. In his report, James criticized Rausser's analysis by claiming that if the alleged conspiracy period is compared to the post-conspiracy period of July, 1995, through December, 1996, there is no statistically significant increase in the quarterly-weighted average transaction prices during the alleged conspiracy period.
On May 31, 2000, over two years after Professor James completed his report criticizing Professor Rausser's regression analysis, Class Plaintiffs' filed the Motion now before the Court. Therein, they seek an order directing Defendants to "supplement" their answers to documents requests 2:2, 2:3, 2:8, and 2:14(a) and interrogatories 3:6 and 6:1. Specifically, Class Plaintiffs request:
The number before the colon refers to the set of document requests or interrogatories, and the number following the colon refers to the document request or interrogatory in the specified set.
[T]his Court enter an order directing defendants to supplement through December 31, 1999 their responses to [the above cited discovery requests] by providing computer readable transactional invoice data for HFCS and corn syrup, profit and loss reports containing monthly production figures for HFCS 42 and 55 for American Maize, and documents reflecting capacity for each of defendants' plants (including Minnesota Corn Processors for ADM and ProGold LLC for Cargill) and for the industry.
(Class Plt. Mem. at 10). According to Class Plaintiffs, this post-conspiracy data is necessary to defend against James' criticism of Rausser's regression analysis. They claim that the additional data would allow a more robust statistical comparison of the alleged conspiracy and post-conspiracy prices of HFCS. Moreover, Class Plaintiffs claim that the additional data might allow a meaningful test of James' assertion that prices in the post-conspiracy period are not statistically different than prices during the alleged conspiracy period.
In the alternative, Class Plaintiffs request that this Court enter an order in limine precluding Defendants and their experts from considering, relying on, or presenting on summary judgment, at trial, or otherwise any information or analysis relating to any post-December 31, 1996, data and from arguing that any post-conspiracy data negatively affects Rausser's analysis or conclusions.
This Order follows.
Discussion
This Court previously held during the June 6, 2000, telephonic hearing that Cargill did not have to "supplement" any of the above-cited discovery requests due to a binding stipulation entered into between Cargill and Class Plaintiffs. This finding remains undisturbed. However, to any extent this Court erred in reaching its conclusion, the following analysis and conclusions apply equally to Cargill.
The discovery cut-off date in this case passed in November, 1997. However, Class Plaintiffs contend that the discovery cut-off date is not germane because they are merely seeking "supplementation" of discovery requests pursuant to Federal Rule of Civil Procedure 26(e). Respectfully, this argument is without any merit. Class Plaintiffs argument that it is seeking "supplementation" of prior discovery request is belied by their attempts in September, 1997, to expand the relevant time frame for transaction data in their Seventh and Eight Sets of Document Requests. If, as Class Plaintiffs argue, that their document requests 2:2, 2:3, 2:8, and 2:14(a) and interrogatories 3:6 and 6:1 facially call for supplementation of transactional for each quarter after December 31, 1996, why, pray tell, did they ever believe that they needed to serve upon Defendants subsequent sets of document requests that sought to extend the data cut-off date from December 31, 1996, to June 30, 1997?
Class Plaintiffs' argument that their discovery requests call for supplementation of transaction data through December, 1999, is further belied by the fact that the relevant sets of discovery request defined the "Relevant Period" that Defendants' answers were to encompass. No definition of "Relevant Period" authored by Class Plaintiffs' experienced and sophisticated counsel even begins to imply that the "Relevant Period" for each set of discovery requests placed upon Defendants a continuous duty to provide transactional data for each quarter or year until this case goes to trial. This, however, is precisely what Plaintiffs are arguing by seeking "supplementation" of data for the "Relevant Period" that is beyond the scope of the "Relevant Period" as defined by Class Plaintiffs' counsel in the sets of discovery requests at issue in the Motion. One would think that if Plaintiffs truly believed that their discovery requests required ongoing supplementation of transaction data for quarters after December, 1996, they would have long ago been seeking such supplementation and on a regular basis. They have not, and will not now be heard to argue that Defendants had and have an ongoing duty to supplement the discovery requests at issue.
The Court further notes, as argued by Defendants, that when the James expert report was served upon Class Plaintiffs, they immediately sought in March, 1998, to exclude his opinion in this case, claiming that they lacked regular corn syrup data that would allow their expert to challenge James' conclusions. On April 13, 1998, this Court held a telephonic hearing, during which the following exchange took place:
THE COURT: I have three or four items on the agenda today. The first one is the motion to strike/bar the testimony of the expert James. I have read the pleadings and I have some specific questions that I would like to you to answer if you would.
First of all, this is directed to the plaintiffs, as of today what is it that you don't have that you feel you need to have in order to fully test the credibility of James' opinion?
MR. KAPLAN: Your Honor, it's Bob Kaplan. We don't have any of the glucose, which is another word for [regular] corn syrup, the glucose transaction data.
THE COURT: Hold on. What period of time does that cover?
MR. KAPLAN: It would cover the same period of time — basically it would cover the same period of time that we got discovery for high fructose corn syrup, which I believe was January 1, 1986 through December 31, 1996, because we look at it — we need before and after the alleged conspiracy period.
* * *
THE COURT: So you have indicated to me that what you want that you don't have right now is the transaction data from `86 to `96. Is there anything else?
MR. KAPLAN: Yes. We would like to reopen depositions to inquire about the market forces on corn syrup because [James] said it's a similar pattern to the market forces on HFCS and we would need their documents on corn syrup which they haven't produced, the same types of documents they have produced with respect to HFCS.
* * *
THE COURT: All right. Is there any other argument you want to make on this?
MR. KAPLAN: No, Your Honor.
(Plt. Ex. 37 at 4, 6, 8) (emphasis added). At the conclusion of the hearing, this Court directed Defendants to turn over the regular corn syrup transactional data and further allowed Class Plaintiffs to re-depose witnesses as a result of the additional data. (Id. at 26-27).
Noticeably absent from Class Plaintiffs' request for additional data in April, 1998, was any request for transactional data, either regarding HFCS or corn syrup, for the period of time after December 31, 1996. This is in spite of the fact that Class Plaintiffs were well aware at that time that James had concluded that there was no statistical difference in pricing during the post-conspiracy and alleged conspiracy time frames and in spite of the fact that as of April, 1998, there were five additional quarters of data potentially available (January 1, 1997 through March 31, 1998).
However, Plaintiffs argue in the Reply that their March, 1998, Motion to Strike the James report focused on Professor James' use of regular corn syrup prices to attack Professor Rausser's analysis, not on the need to obtain data beyond December, 1996. While this is true, the Court could not have been any clearer when it asked Plaintiffs' counsel "[W]hat is it that you don't have that you feel you need to have in order to fully test the credibility of James' opinion?" (Plt. Ex. 37 at 4) (emphasis added). Moreover, nothing prohibited Class Plaintiffs from focusing their Motion to Strike on other issues presented by the James report. Plaintiffs should have known as of March 1998, when over a year's worth of additional transaction data was then available, that such data would have been helpful in rebutting Professor James' conclusions since, as they now argue, additional data allows for a more robust statistical analysis. At a minimum, since they are seeking data through December, 1999, their motion should have been on file no later than January, 2000, while this case was still in the court of appeals awaiting resolution of the recent interlocutory cross-appeal.
The Court recognizes that it has the authority under Rule 26(e) to order supplemental discovery even though Class Plaintiffs' discovery requests impose no such duty. It declines to do so because Class Plaintiffs have not proffered a sufficient reason for waiting until now to seek additional discovery. In their Reply, Class Plaintiffs state:
Why did plaintiffs wait until now to seek this data? Because plaintiffs did not want to keep renewing their request piecemeal every six months or every year. Instead, plaintiffs waited until a juncture was reached where the completion of the case was in sight and the scope of the supplemental data could be known.
(Reply at 2). Class Plaintiffs' argument presupposes: (1) that this Court would have ever been inclined to have allowed the scope of data discovery to extend to December 31, 1999; and (2) that this Court could not have earlier entered a self-executing order placing upon Defendants the duty to produce additional data on a quarterly basis. Both presuppositions are tenuous. It is highly doubtful that Class Plaintiffs would have ever been entitled to three additional years of data, and there is nothing that prohibited this Court, upon motion by Class Plaintiffs and for good cause shown, to have entered an order back in the spring of 1998 requiring Defendants to provide additional data on a quarterly basis through a certain date. Additionally, if every litigant before this Court took the approach of asking for additional discovery when the end of a case were in sight, there would be no end to any case.
For the foregoing reasons, the Court concludes that Class Plaintiffs are not entitled to additional data.
Class Plaintiffs alternate request that Defendants' experts not be allowed to rely on any post-December 31, 1996, data is moot. Defendants represented to the Court during the telephonic hearing on June 6, 2000, that Professor James relied on the same information that is in Class Plaintiffs' possession and did not rely on any post-December 31, 1996, data. (Doc. #578 at 14-16; see also Dft. Resp. at 11).
The Court is denying Class Plaintiffs' alternative request to bar Defendants and their experts from arguing that the post-conspiracy data, i.e., the data from July 1, 1995, through December 31, 1996, negatively affects Professor Rausser's conclusion that there was a conspiracy in the HFCS market to fix prices. Class Plaintiffs have failed to explain why Professor Rausser should be able to rely on post-conspiracy data in reaching his conclusions but Defendants' experts should not be allowed to rely on the same data in reaching contrary conclusions. Contrary to Class Plaintiffs' contention, there is nothing fundamentally unfair about opposing experts relying on the same data in reaching their respective conclusions and leveling criticism against each other. Absent the parties' experts being prohibited pursuant to Daubert and its progeny from testifying at trial, this battle of the experts will be left for the trier of fact to resolve.
Conclusion
For the foregoing reasons, Class Plaintiffs' Motion for Order [#568-1] is GRANTED IN PART and DENIED IN PART. The Motion is GRANTED solely with respect to Class Plaintiffs' request that Defendants and their experts be prohibited from relying on and using any post-December 31, 1996, transactional data and is DENIED in all other respects.
ENTERED this 19th day of July, 2000.