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Noranda Alumina LLC v. Associated Terminals LLC

United States District Court, E.D. Louisiana

February 28, 2018


         SECTION: “J” (5)

          ORDER & REASONS



         Before the Court is the Report and Recommendation issued by the United States Magistrate Judge assigned to this case. (Rec. Doc. 34.) On November 8, 2017, Associated Terminals, LLC (“Associated”) filed a Motion to Dismiss With Prejudice for Failure to Comply with a Court Order and Abuse of Discovery.[1] (Rec. Doc. 17.) The Court referred the motion to the Magistrate Judge for a Report and Recommendation. After a hearing, the Magistrate Judge issued his Report on January 4, 2018, with the recommendation that the motion be granted and that the claims of Noranda Alumina, LLC (“Noranda”) be dismissed with prejudice. (Rec. Doc. 34.) Noranda filed an objection to the Report (Rec. Doc. 36) and Associated filed a response (Rec. Doc. 39). Having considered the motion, the Magistrate Judge's Report and Recommendation, the legal memoranda, the record, and the applicable law, the Court finds that the motion should be GRANTED.


         A. Facts and Procedural Background

         This case concerns cross-claims for property damage arising out of stevedoring operations at Noranda's Gramercy, Louisiana facility. Specifically, Noranda has asserted a claim for damages against Associated arising out of the March 2016 partial collapse of Noranda's dock fendering system. Associated filed a counterclaim for damage to the hull of its vessel, the M/V MISS TARA, allegedly caused by the deteriorated condition of the dock.

         In October 2015, Associated began stevedoring operations for Noranda at the Gramercy facility. Associated was tasked with unloading bauxite from oceangoing vessels with the help of Associated's crane barges. Associated alleges that it was hesitant to commence operations on the dock due to the dock's deteriorated condition but proceeded after receiving various assurances from Noranda that improvements would be forthcoming. On February 8, 2016, Noranda filed for Voluntary Chapter 11 Bankruptcy. Associated alleges that at that time, Noranda owed Associated over $1.3 million for services rendered, however it continued its operations for Noranda. Associated claims that it has not recovered any of those accounts receivable to date.

         On March 16, 2016, part of Noranda's dock face and fender system collapsed into the river. On May 9, 2016, Associated discovered significant damage to its crane barge, the M/V MISS TARA, which was allegedly caused by submerged portions of the collapsed dock structure. After discovering the damage, Associated immediately placed Noranda on notice that it held Noranda responsible for the damages.

         Without any prior notice of a claim, on June 6, 2016, Noranda filed an Adversary Complaint against Associated in Noranda's Chapter 11 Bankruptcy proceeding in the United States Bankruptcy Court for the Eastern District of Missouri. In the complaint, Noranda alleges that Associated caused the Gramercy dock collapse by damaging the dock during its stevedoring operations. Noranda seeks $1.5 million from Associated for a new dock fender system.

         On August 4, 2016, Associated filed an answer and counterclaim for the damage caused to the M/V MISS TARA. On August 10, 2016, Associated issued to Noranda the written discovery that is the subject of the instant motion, responses to which were due on September 28, 2016. Noranda did not respond to the discovery requests.

         On November 23, 2016, the bankruptcy proceeding was closed and Noranda transferred the claims to this Court. The following is a summary of the relevant procedural history pertinent to the present motion:

- On March 23, 2017, the Court issued a Scheduling Order (Rec. Doc. 6), setting forth the following deadlines:
o Plaintiff's expert reports due August 9, 2017
o Pretrial motion deadline September 26, 2017
o Discovery deadline October 6, 2017
o Pretrial conference November 11, 2017
o Non-jury Trial December 4, 2017

         - Beginning on May 3, 2017, counsel for Associated began inquiring about Noranda's overdue responses to Associated's written discovery requests (issued August 10, 2016, responses due September 28, 2016). Associated formally inquired about the responses again on June 12, 2017 and July 13, 2017. Associated warned Noranda that it would file a motion to compel if Noranda failed to timely provide responses. (Rec. Doc. 7-3.)

         - On August 3, 2017, Associated arranged a Rule 37 discovery conference and a second conference on August 10, 2017. (Rec. Doc. 7.) Despite the two conferences, Noranda still did not provide responses to Associated's discovery requests.

         - On August 11, 2017, Associated requested dates for corporate depositions and the depositions of four fact witnesses. Noranda did not provide any available dates. (Rec. Doc. 17-11.)

         - On August 14, 2017, Associated filed a Motion to Compel. (Rec. Doc. 7.) On August 22, 2017, counsel for Noranda filed a two-and-a-half page opposition memorandum to Associated's motion to compel, suggesting that the discovery delay was his fault because he had been busy attending to another case, but was “endeavoring to provide Noranda's responses to Associated's discovery prior to the motion hearing on August 30, 2017.” (Rec. Doc. 9 at 2.)

         - On August 23, 2017 and August 28, 2017, Associated again sought dates from Noranda for the depositions of Noranda's fact witnesses. Noranda again provided no dates. (Rec. Doc. 17-11.)

         - On August 30, 2017, after the hearing on the motion to compel, the Magistrate Judge ordered Noranda to fully and formally respond to the outstanding discovery within 14 days, without objection. (Rec. Doc. 10.) The Magistrate Judge held Associated's request for reasonable expenses, including attorneys' fees, in abeyance pending compliance with the Order.

         - On August 28, 2017 and September 1, 2017, Associated issued a subpoena and Notice of 30(B)(6) corporate deposition to Noranda and Noranda's apparent successor entity, New Day Aluminum, LLC (“New Day”).[2] Noranda and New Day's responses would have been due on September 27 and October 2, 2017, respectively. (Rec. Doc. 17-11.) No responses were provided.

         - On September 1, 2017, Associated's counsel, for the third time, requested deposition dates for fact witnesses by the close of business on September 6, 2017.

         - On September 13, 2017, the deadline ordered by the Magistrate Judge for Noranda to provide full and complete responses to written discovery without objection, counsel for Noranda asked Associated's counsel for an additional “day or two” to respond. (Rec. Doc. 17-5.) Counsel for Noranda did not request an extension from the Magistrate Judge.

         - That same day (when responses were due per the Magistrate Judge's order) Noranda's counsel requested certain material, responsive information from his client. (Rec. Doc. 17-8.)

         - On September 15, 2017, two days after the Magistrate Judge ordered full and complete responses, Noranda provided Associated with partial, incomplete responses. (Rec. Doc. 34.)

         - On October 10, 2017, due to Noranda and New Day's failure to respond to Associated's Notice of 30(B)(6) corporate deposition, Associated unilaterally noticed the corporate depositions for October 25 and 26, and again notified Noranda of its overdue responses to the Corporate Deposition Notices. (Rec. Doc. 17-12.)

         - Following up on Noranda's incomplete responses, on October 12, 2017, Associated requested that Noranda “produce all responsive documents within seven days or issue supplemental discovery responses certifying that no such document exist.” (Rec. Doc. 17-9.)

         - One week before the noticed depositions, on October 18, 2017, Associated's counsel yet again requested complete responses to its written discovery. (Rec. Doc. 17-13.)

         - Noranda's ongoing failure to respond to these requests caused Associated's counsel to request a telephone conference with the Magistrate Judge, during which Noranda stated for the first time that it did not “own” the claim that it was asserting as the nominal plaintiff in this matter. The Magistrate Judge gave Noranda 48 hours to notify him and Associated of the identity of the real party in interest that owns the claim being asserted by Noranda.

         - On October 25, counsel for Noranda informed the Magistrate Judge by letter that the true owner of the claim is non-party, Gramercy Holdings I, LLC (“Gramercy Holdings”), and that there were no funds remaining in the estate of the bankrupt debtor (Noranda) to satisfy any judgment against it in this case. (Rec. Doc. 30.)

         - On November 1, 2017, the Magistrate Judge held a Court-ordered settlement conference with the parties, which was unsuccessful. (Rec. Doc. 15.)

         - On November 7, 2017, due to a conflict in the Court's calendar, the Court issued an order continuing the November 9, 2017 pretrial conference and December 4, 2017 trial. (Rec. Doc. 16.) The Court also ordered that the parties ...

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