Norman B. Newman, solely as Liquidating Trustee of the World Marketing Liquidating Trust v. Crane, Heyman, Simon, Welch & ClarMOTIONN.D. Ill.June 10, 2019-1- IN THE UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION NORMAN B. NEWMAN, solely as Liquidating Trustee of the World Marketing Liquidating Trust, Plaintiff, v. CRANE, HEYMAN, SIMON, WELCH & CLAR, Defendant. Civil Action No. 17-6978 Judge Thomas M. Durkin Magistrate Judge Susan E. Cox TRIAL BY JURY DEMANDED MOTION FOR DISCOVERY UNDER FEDERAL RULE OF CIVIL PROCEDURE 56(D) The Plaintiff has filed a Motion for Partial Summary Judgment (“MPSJ”) as to CH’s Second, Third, and Fourth Affirmative Defenses. For the reasons stated in CH’s Opposition to Plaintiff’s MPSJ, filed contemporaneously with this motion, the Plaintiff’s MPSJ should be denied. However, because CH has not been permitted to conduct full and complete fact discovery, including but not limited to depositions of key individuals involved in the underlying bankruptcy and production of documents in the exclusive custody and control of Plaintiff or its counsel. Without such evidence, CH is unable to fully present facts essential to its opposition to Plaintiff’s MPSJ. Accordingly, pursuant to Federal Rule of Civil Procedure 56(d), and for the reasons stated in the attached Declaration of LeighAnn M. Thomas, CH moves the Court to deny, or defer consideration of, the Plaintiff’s MPSJ to allow time to conduct and complete fact discovery in this case. Joseph R. Marconi, ARDC #01760173 Ramses Jalapour, ARDC #6313128 LeighAnn M. Thomas, ARDC #6327687 Johnson & Bell, Ltd. 33 West Monroe Street, Suite 2700 Chicago, Illinois 60603 Tel: 312-372-0770 marconij@jbltd.com jalapourr@jbltd.com thomasl@jbltd.com Respectfully submitted, CRANE, HEYMAN, SIMON, WELCH & CLAR By: __/s/ Joseph R. Marconi One of Its Attorneys Case: 1:17-cv-06978 Document #: 111 Filed: 06/10/19 Page 1 of 5 PageID #:1681 -2- CERTIFICATE OF SERVICE I hereby certify that on June 10, 2019, I served a copy of the foregoing on the following individuals by email: Eric D. Madden (admitted pro hac vice) Brandon V. Lewis (admitted pro hac vice) D. Benjamin Thomas (admitted pro hac vice) Reid Collins & Tsai LLP 1601 Elm Street, Suite 4250 Dallas, Texas 75201 Telephone: 214.420.8900 Facsimile: 214.420.8909 emadden@rctlegal.com blewis@rctlegal.com bthomas@rctlegal.com -and- Michael Brandess (6299158) SF Grais & Helsinger LLP 30 N. LaSalle St., Ste. 3000 Chicago, Illinois 60602 Telephone: 312.704.9400 Facsimile: 312.372.7951 mbrandess@SFGH.com Counsel for Plaintiff Norman B. Newman, solely as Liquidating Trustee of the World Marketing Liquidating Trust _/s/ Tula Kotsiovos __________________ Case: 1:17-cv-06978 Document #: 111 Filed: 06/10/19 Page 2 of 5 PageID #:1682 -3- DECLARATION OF LEIGHANN M. .THOMAS I, LeighAnn M. Thomas, declare as follows: 1. I am a member in good standing with the Illinois Bar and the Wisconsin Bar, and am employed as an associated at the law firm of Johnson & Bell, Ltd., which represents Defendant Crane, Heyman, Simon, Welch & Clar (“CH”). 2. I am one of the attorneys of record who assists with the Defendant’s representation in the above-captioned matter, and I am familiar with the pleadings, papers, and other communications in the above-captioned matter. 3. The statements made in this declaration are based upon my personal knowledge. 4. This Declaration is submitted pursuant to Federal Rule of Civil Procedure 56(d), which provides, (d) When Facts Are Unavailable to the Nonmovant. If a nonmovant shows by affidavit or declaration that, for specified reasons, it cannot present facts essential to justify its opposition, the court may: (1) defer considering the motion or deny it; (2) allow time to obtain affidavits or declarations or to take discovery; or (3) issue any other appropriate order. 5. Although CH believes the Plaintiff’s Motion for Partial Summary Judgment (“MPSJ”) should be denied outright for the reasons set for in CH’s Memorandum of Law in Opposition to Plaintiff’s MPSJ, CH submits this Declaration to demonstrate that CH cannot present all facts essential to support its opposition because it has not yet been able to discover all facts underlying the issues in this case. 6. At the time Trustee filed its MPSJ on April 10, 2019, fact discovery was scheduled to close on May 31, 2019. 1 Prior to the In-Chambers Conference before Judge 1 On April 11, 2019, Magistrate Judge Cox granted the parties’ joint oral motion for Extension of Fact Discovery to July 30, 2019. Case: 1:17-cv-06978 Document #: 111 Filed: 06/10/19 Page 3 of 5 PageID #:1683 -4- Durkin, counsel for CH indicated that a motion prior to fact discovery closing without full completion of fact discovery was premature. Counsel repeated this position during the In- Chambers Conference on March 13, 2019 and again following the In-Chambers Conference. Nevertheless, Trustee filed its MPSJ. 7. The following discoverable information is essential to CH’s opposition to Plaintiff’s MPSJ, but is unavailable to CH without discovery: a. Evidence regarding settlement of the WARN Claim. Plaintiff has refused to produce relevant documents based upon unfounded objections. Plaintiff has asserted the attorney-client privilege over communications between SF and the WARN Class counsel, i.e. communications between attorneys of opposing parties. Communications pursuant to Rule 37 regarding this discovery dispute are ongoing. b. Evidence that was recently discovered in the possession of a former CH employee. In the Wisconsin Litigation, the WARN Class filed a lawsuit against World Marketing Holdings, LLC and Blue Streak Holdings LLC for violation of the Act (“Wisconsin Litigation”). See Carroll, et al., v. World Marketing Holdings, LLC, Case No. 2:17-cv-01309-LA (E.D. Wisc. 2017), Doc. 1. The claims raised by the WARN Class are identical to the claims asserted against WM in the underlying bankruptcy. On December 6, 2018, the defendants in the Wisconsin Litigation reported that “they recently discovered numerous documents in the possession of a former employee.” Id. Doc. 50. On June 6, 2019, after numerous requests, counsel for CH obtained these documents, which consist of 5,795 pages. Counsel for CH is currently reviewing these documents, which may be relevant to the issues raised by the MPSJ. c. Evidence concerning SF’s objection to the WARN Claim. CH has not yet had the ability to depose certain witnesses, including former and current attorneys at SF. Although CH noticed the attorneys at SF for deposition to take place on May 6, 7 and 8, 2019. Unfortunately, those depositions have been postponed indefinitely as a result of a five-plus month delay by SF to produce documents responsive to a subpoena issued by CH in December 2018. Counsel for CH intends to notice these depositions for dates in or around July 2019. These depositions will be critical on numerous issues; in particular, their testimony is expected to reveal why SF chose to waive certain defenses to the WARN Class claim. d. Evidence concerning the decision to file bankruptcy, terminate employees, and not issue a WARN notice. CH has not yet had the opportunity to depose John Widmer, the Chief Financial Officer of FirstPathway Partners, Inc. He was on a phone call that took place prior to CH’s retention during which it was decided— Case: 1:17-cv-06978 Document #: 111 Filed: 06/10/19 Page 4 of 5 PageID #:1684 -5- without CH’s input—that WM did not need to issue a WARN notice. From e- mail communications, it is also clear Mr. Widmer was intimately involved with the decision to file bankruptcy and the timing of that decision, which is a critical fact at issue in Plaintiff’s MPSJ. Mr. Widmer’s deposition is scheduled to take place on June 11, 2019. 8. The foregoing evidence is discoverable pursuant to Federal Rule of Civil Procedure 26(b)(1) because it is relevant to CH’s affirmative defenses that certain exceptions to WARN Act liability applied but were not properly asserted by Trustee. 9. CH is presently unable to present the foregoing evidence because such evidence is solely and exclusively in the possession and/or control of Trustee and/or can only be compelled, as a practical matter, through the discovery process. 10. Accordingly, the Court should grant CH’s relief under Federal Rule of Civil Procedure 56(d). Plaintiff’s MPSJ should be denied, or alternatively deferred, to allow time to take discovery regarding the foregoing evidence. 11. Pursuant to 28 U.S.C. 1746, I declare under penalty of perjury that the foregoing is true and correct to the best of knowledge and belief. Executed on June 10, 2019. ______________________________ LeighAnn M. Thomas Counsel for Defendant Case: 1:17-cv-06978 Document #: 111 Filed: 06/10/19 Page 5 of 5 PageID #:1685