SUE E. MYERSCOUGH, District Judge.
This cause is before the Court on the Motion and Brief to Deem Facts Admitted (d/e 19) filed by Plaintiff H.D. Smith, LLC, and the Motion to Withdraw Default Admissions (d/e 21) filed by Defendants Meds 2 Go Express Pharmacy, Inc. (Express Pharmacy), and Philip Michael. The Court GRANTS Defendants' Motion to Withdraw Default Admissions because doing so promotes the presentation of the merits of the action and any prejudice to Plaintiff is cured by the Court extending the discovery deadline for Plaintiff. Plaintiff's Motion to Deem Facts Admitted is DENIED.
This Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1332(a). Complete diversity exists between the parties.
Plaintiff is a single member Delaware limited liability company. Compl. ¶ 1 (d/1-1); Residency Statement (d/e 6). The single member is H.D. Smith Holdings, LLC, a Delaware limited liability company.
Defendant Express Pharmacy is a West Virginia corporation that operates in Alum Creek, West Virginia. Compl. ¶ 2; Notice of Removal ¶ 4 (d/e 1). Defendant Michael is a citizen of West Virginia who resides in Charleston, West Virginia. Notice of Removal ¶ 5.
In addition, the amount in controversy exceeds $75,000 exclusive of interest and costs. In the Complaint, Plaintiff seeks damages in the amount of $103,835.17.
In September 2016, Plaintiff filed a complaint against Defendants in the Seventh Judicial Circuit, Sangamon County, Illinois. Defendants removed the action to this Court.
The complaint alleges the following. Plaintiff is engaged in the business of selling health products. In October 2015, Express Pharmacy entered into a Credit Agreement with Plaintiff. From approximately July 1, 2016 through August 25, 2016, Plaintiff provided health products to Express Pharmacy but Express Pharmacy refused to pay the customary charges and associated taxes and fees that were due. Plaintiff brings a breach of contract, quantum meruit, and action on account stated claim against Express Pharmacy (Counts I, II, III) and a claim against Philip Michael, who executed an individual guarantee (Count IV).
Defendants filed an Answer and Counterclaim (d/e 2). The Counterclaim contains claims for breach of contract, breach of the covenant of good faith and fair dealing, and promissory estoppel. Defendants allege that Express Pharmacy entered into a contract with Plaintiff whereby Express Pharmacy would purchase controlled medications from Plaintiff and sell them to customers with valid prescriptions. Defendants specifically allege that, in July 2016, Plaintiff suddenly stopped supplying controlled medications to Pharmacy Express, without any warning or explanation. Pharmacy Express has allegedly suffered damages because of Plaintiff's abrupt termination of shipments of controlled medications.
In December 2016, United States Magistrate Judge Tom Schanzle-Haskins entered a Scheduling Order (d/e 13). The Scheduling Order granted the parties until September 1, 2017 to complete fact discovery.
On June 8, 2017, Plaintiff served upon Defendants a Request to Admit Facts and Genuineness of Documents (Request to Admit) pursuant to Federal Rule of Civil Procedure 36. The Request to Admit listed 228 facts. Defendants' response was due on or before July 11, 2017. Defendants did not timely respond.
On August 1, 2017, Plaintiff filed a Motion and Brief to Deem Facts Admitted (d/e 19). On August 15, 2017, Defendants responded to the Motion and moved to withdraw the default admissions.
On August 25, 2017, Plaintiff filed a Reply. While replies are generally not permitted for motions other than motions for summary judgment, the Court will accept Plaintiff's document as a response to Defendants' motion to withdraw the default admissions.
In their Motion to Withdraw Default Admissions, Defendants assert that, even though the response to the Request to Admit was served 35 days late, the matter should proceed on the merits because discovery has not yet concluded and Plaintiff is not prejudiced by the tardy response. Defendants also indicate that the parties reached an agreement that Defendants would respond to Plaintiff's outstanding Interrogatories and Request to Produce by August 22, 2015.
Plaintiff argues that Defendants could have requested an extension of the 30-day period to respond to the Request to Admit but failed to do so. Instead, Defendants did not respond to the Request to Admit until August 15, 2017, over a month after the deadline and just two weeks before fact discovery closed. Plaintiff asserts it will suffer prejudice because Defendants failed to respond to the Request to Admit until two weeks before the discovery deadline, which leaves little time for Plaintiff to conduct follow-up discovery. Plaintiff also notes that, while the parties did reach an agreement to extend the deadline for Defendants to respond to Plaintiff's Interrogatories and Request to Produce, the agreement was reached only after Plaintiff sent a meet-and-confer letter.
Pursuant to Rule 36 of the Federal Rules of Civil Procedure, a party may serve on another party a written request to admit the truth of any matter within the scope of Rule 26(b)(1) relating to: "(A) facts, the application of law to fact, or opinions about either; and (B) the genuineness of any described documents." Fed. R. Civ. P. 36(a)(1). A matter is admitted unless the party answers or objects within 30 days after being served.
In this case, Defendants failed to timely respond to the Request to Admit. Therefore, the facts therein are deemed admitted.
The Court will exercise that discretion here. In doing so, the Court does not condone Defendants' untimely response to the Request to Admit. Furthermore, Defendants' excuse for failing to timely respond was vague. Nonetheless, allowing withdrawal of the admissions promotes the presentation of the case on the merits and any prejudice to Plaintiff can be cured by extending the discovery deadline for Plaintiff.
As noted by Defendants, allowing withdrawal of the admissions would promote the presentation of the merits of the case because the admissions would otherwise conclusively establish at least some of the claims in Plaintiff's complaint and Defendants' counterclaim. For example, Plaintiff asked Defendants to admit that Michael did not send written notice of revocation of the individual guarantee and did not receive a written release of the individual guarantee. One of Defendants affirmative defenses is that Plaintiff released "Defendant" from any liability.
As for prejudice, Plaintiff bears the burden of establishing that withdrawal of the admissions would result in prejudice.
Plaintiff argues it will suffer prejudice because discovery closes September 1, 2017, which limits Plaintiff's ability to conduct follow-up discovery. The Court can, however, eliminate any such prejudice by extending discovery—for Plaintiff only—to November 1, 2017.
For the reasons stated, the Court GRANTS Defendants' Motion to Withdraw Default Admissions (d/e 21). Defendants' August 15, 2017 response to the Request to Admit—which includes the admission to 195 facts—will stand. The deadline for the completion of fact discovery is extended—for Plaintiff only—to November 1, 2017. All other dates in the Scheduling Order remain the same. Plaintiff's Motion to Deem Facts Admitted (d/e 19) is DENIED.