ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFFS' MOTION TO COMPEL, ADOPTING IN PART AND REJECTING IN PART SPECIAL MASTER REPORT NO. 7, AND OVERRULING IN PART AND SUSTAINING IN PART PLAINTIFFS' OBJECTIONS

WILLIAM J. MARTÍNEZ, District Judge.

Plaintiffs Lorraine M. Ramos and others assert claims under Section 502 of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1132, against Defendants Banner Health and several of its officers (collectively, "Banner") as well as against Jeffrey Slocum & Associates, Inc. ("Slocum"). This case is currently before the Court on Plaintiffs' Motion to Compel Supplementation of the Banner Defendants' Discovery Responses (the "Motion") (ECF No. 258) and Special Master John P. Leopold's Report No. 7 concerning the Motion (ECF No. 267).1 Plaintiffs seek production of five categories of documents related to materials prepared, developed, and used at meetings of the Banner Health Retirement Plans Advisory Committee ("RPAC") and the Banner Investment Committee ("IC"), quarterly asset balances through the present, Plan participant counts through the present, and a spreadsheet related to a 2016 audit. The discovery dispute was referred to Special Master Leopold for a recommendation, which he provided on January 16, 2018 by way of Report No. 7. (ECF No. 267.)

For the reasons discussed below, the Court concurs in part with the Special Master and orders Banner to produce the 2016 RPAC minutes and materials. The Court rejects the Special Master's recommendation on the quarterly asset balances and Plan participant counts, and orders Banner to produce docum ents with such information through November 30, 2017. In addition, because the Special Master recom mendation did not directly address the audit spreadsheet, the Court reviewed the underlying Motion and now orders production of the subject document.

I. BACKGROUND

The parties are familiar with the factual and procedural background of this case, so an exhaustive review is unnecessary. The facts relevant to the instant dispute as set forth below are drawn primarily from Plaintiffs' Amended Complaint (ECF No. 118) and the parties' briefing on the Motion and on the Special Master's recommendation (ECF Nos. 258, 264, 265, 269-1, 272).

Plaintiffs are participants in Banner's 401(k) employee retirement plan (the "Plan"). The Plan assets are held in trust, with a trustee appointed by Banner. Banner Health is the named fiduciary of the Plan, as well as Plan administrator within the meaning of ERISA. See 29 U.S.C. §§ 1002(16)(A) & 1102(a).

Banner selected Fidelity Management Trust Company ("Fidelity") to provide recordkeeping and administrative services to the Plan. Banner also hired Defendant Slocum as a third-party investment consultant to act as a fiduciary for investment and administration of Plan assets. Slocum was responsible for reviewing investment policy statements that governed the Plan and investment options in the Plan.

The parties agree that RPAC was a fiduciary to the Plan responsible for day-to-day Plan operations, selecting investment options, and evaluating fees. (ECF No. 258 at 4; ECF No. 264 at 3.) The IC was an authorized subcommittee of the Banner Health Board of Directors that was responsible for monitoring performance of the CEO. (ECF No. 258 at 4; ECF No. 264 at 3; ECF No. 269-1 at 4.) Plaintiffs claim that the IC was a fiduciary to the Plan. (ECF No. 269-1 at 4.) Banner Defendants disagree. (ECF No. 264.)

Plaintiffs commenced this class action litigation on November 20, 2015, alleging five separate causes of action. (ECF No. 1.) Relevant to this discovery dispute, Plaintiffs allege that Defendants breached their fiduciary duties to Plaintiffs by allowing Fidelity to collect excessive recordkeeping and administrative fees from the Plan, and by failing to assure that compensation paid to Fidelity and Banner Health was reasonable for the administrative services provided. (ECF No. 118 ¶¶ 62-80, 120-30). On March 28, 2018, the Court granted class certification of Plaintiffs' claims against Banner, defining the class as "[a]ll participants and beneficiaries of the Banner Health Employees 401(k) Plan from November 20, 2009 through the date of judgment, excluding the Defendants." (ECF No. 296.)

In late 2017, Plaintiffs moved to compel production of certain documents. (ECF No. 258.) The Court referred the discovery dispute to Magistrate Judge Michael J. Watanabe, who in turn referred it to Special Master Leopold with instructions to review the Motion and provide the Court with a written report and recommended ruling. (ECF Nos. 55, 261.) Special Master Leopold submitted Report No. 7 on the Motion on January 16, 2018. (ECF No. 267.) Plaintiffs timely filed an objection (ECF No. 268) and, though not explicitly contemplated by the Federal Rules of Civil Procedure, Defendants filed a response (ECF No. 272). Upon Judge Watanabe's retirement, the undersigned withdrew the referral to Judge Watanabe. (ECF No. 326.) As a consequence, the Court will treat Report No. 7 as a report and recommendation made directly to the undersigned.

II. STANDARD OF REVIEW

The Court reviews objections to factual and legal findings of a special master de novo and rulings on procedural matters for abuse of discretion. Fed. R. Civ. P. 53(f)(3)-(5). Even where a party does not object to a recommendation, a court may elect to review a special master recommendation de novo. Id., Advisory Comm. Note 2003. Upon review, the Court may "adopt or affirm, modify, wholly or partly reject or reverse, or resubmit to the master with instructions." Id. 53(f)(1).

Courts differ on whether discovery recommendations are procedural or non-procedural in nature. See Callwave Commc'n LLC v. AT&T Mobility LLC, 2016 WL 3450736, at *1, n.3 (D. Del. June 16, 2016).2 Neither this District nor the United States Court of Appeals for the Tenth Circuit has directly addressed this issue. Some courts in other Districts consider discovery recommendations a procedural matter and review special master recommendations for abuse of discretion. See Nippon Steel & Sumitomo Metal Corp. v. Posco, 2014 WL 1266219, at *1 (D.N.J. Mar. 26, 2014) (reviewing a special master recommendation on discovery matters under an "abuse of discretion" standard); In re Hardieplank Fiber Cement Siding Litig., 2014 WL 5654318, at *1 (D. Minn. Jan. 28, 2014) ("A decision regarding the scope of discovery is a procedural matter, reviewed for abuse of discretion."). Other courts, faced with objections to special master recommendations on discovery issues, have reviewed de novo. See In re Cathode Ray Tube (CRT) Antitrust Litig., 301 F.R.D. 449 (N.D. Cal. 2014) (reviewing de novo a special master's recommendation on a motion for a protective order); Wellin v. Wellin, 2015 WL 5781383, at *1 (D.S.C. Sept. 30, 2015) (appearing to apply a de novo standard to a special master's report and recommendation to non-dispositive discovery motions).

III. ANALYSIS

The Court concludes that it need not resolve the question of whether objections to a special master recommendation on the scope of discovery should be decided de novo or under an abuse of discretion standard of review. Both Plaintiffs and Banner contend that the Court should review Report No. 7 de novo, which the Court may in any event do in its discretion. See Fed. R. Civ. P. 53, Advisory Comm. Note. 2003.3

Reviewing under a de novo standard, the Court overrules in part and sustains in part Plaintiffs' objections to the issues actually decided by the Special Master. For issues on which the Special Master did not issue a specific recommendation, the Court decides Plaintiffs' Motion in the first instance.

A. Discovery Standards

The Federal Rules provide that "parties may obtain discovery regarding any nonprivileged mater that is relevant to any party's claim or defense and proportional to the needs of the case." Fed. R. Civ. P. 26(b)(1). This broad standard allows parties to discover information necessary to support their case. Meeker v. Life Care Ctrs. of America, Inc., 2015 WL 5244947, at *2 (D. Colo. Sept. 9, 2015). Generally, the party "objecting to discovery must establish that the requested information does not fall under the scope of discovery as defined in Fed. R. Civ. P. 26(b)(1)." Clay v. Lambert, 2017 WL 4755152, at *2 (D. Colo. Oct. 20, 2017). However, "when the relevance of a discovery request is not apparent on the face of the request itself, the proponent of discovery bears the burden of making an initial, rebuttable showing of relevance." Meeker, 2015 WL 5244947, at *2.

While the scope of discovery is broad, it is not unlimited and is bounded by the principle of proportionality. Meeker, 2015 WL 5244947, at *2; see Fed. R. Civ. P. 26(b)(2)(c). In determining whether a discovery request is proportional or should be limited, a court considers "the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit." Fed R. Civ. P. 26(b)(1), (2)(C); see Meeker, 2015 WL 5244947, at *2. "This is particularly true in large or complex litigation, in which a court may limit the scope of discovery to protect a party from unduly burdensome discovery requests." Beltran v. InterExchange, Inc., 2018 WL 2045890, at *3 (D. Colo. May 2, 2018).

Parties are under a continuing obligation to supplement discovery if they learn "that in some material respect the disclosure or response is incomplete or incorrect, and if the additional or corrective information has not otherwise been made known to the other parties during the discovery process." Fed. R. Civ. P. 26(e)(1); see Switch Commc'ns Group v. Ballard, 2012 WL 2342929, at *7 (D. Nev. June 19, 2012). While courts allow discovery of documents post-dating the filing of a complaint, such documents must be relevant to the claims in the complaint and not a fishing expedition into other potential claims. United States ex rel. Spay v. CVS Caremark Corp., 2013 WL 4525226, at *3-4 (E.D. Pa. Aug. 27, 2013). When evaluating the temporal scope of discovery, "the court's task is to balance the relevance of the information against the burden on the defendant." Caban v. Sedgwick Cnty. Sheriff's Dept., 2000 WL 1480481, at *2 (D. Kan. May 18, 2000). The balance will reflect the needs of and burdens on the parties and the judicial system. For example, in a Medicare fraud case, the court recognized that "some end date must be established; otherwise, discovery would never end. It is not manageable to permit the continued discovery of patient records, experts' reviews of them, and deposition testimony about them through trial." United States ex rel. Conroy v. Select Med. Corp., 307 F.Supp.3d 896, 906 (S.D. Ind. 2018). The court in Conroy thus set a "somewhat arbitrary" end date (the date on which the court entered its ruling on defendants' motion to dismiss) as "a proxy for establishing a reasonable period of overall time . . . that is manageable for discovering information about [the claims]." Id. at 906-07.

B. Application

Plaintiffs seek production of five categories of documents: (1) RPAC minutes and materials (including consultant reports and agendas) from 2016 and 2017; (2) IC minutes and materials (including consultant reports and agendas) from 2016 and 2017; (3) quarterly asset balances from the second quarter of 2015 through the present; (4) Plan participant counts from the second quarter of 2015 through the present; and (5) a spreadsheet created by Michael O'Connor as a result of the 2016 audit (covering 2012 to 2016), referenced at Mr. O'Connor's November 28, 2017 deposition. (ECF No. 258 at 2-3.)

The Special Master recommended (1) production of the 2016 RPAC minutes and materials, but not the 2017 RPAC minutes and materials; (2) no production of the IC minutes and materials; (3) no production of quarterly asset balances; and (4) no production of Plan participant counts. (ECF No. 267 at 2-3.) The parties disagree on whether Report No. 7 contained a clear recommendation on the audit spreadsheet, and what the recommendation was. (ECF No. 269-1 at 9-10; ECF No. 272 at 7-8.)

Plaintiffs object to the parts of Report No. 7 that recommended denying the Motion. Specifically, Plaintiffs contend that they should receive (1) the 2017 RPAC minutes and materials; (2) the IC minutes and materials; (3) quarterly balances through the present; and (4) plan participant counts through the present. Plaintiffs also seek clarification on the recommendation on the audit spreadsheet. The Court will address each category in turn.

1. RPAC Minutes and Materials

The Special Master recommended that Defendants be required to produce the 2016 RPAC minutes and materials. Neither party objects to this recommendation and Defendants have agreed to produce the RPAC 2016 minutes and materials if the Court adopts the Special Master's recommendation. (ECF No. 272 at 6.) The Court finds that, though these materials post-date filing of the complaint, the 2016 RPAC minutes and materials are temporally proximate to the events giving rise to Plaintiffs' claims and thus more likely than not to contain relevant information about RPAC's decisionmaking, are not unduly burdensome to produce, and have already been partially disclosed. Banner is therefore ordered to produce the 2016 RPAC minutes and materials.

The Special Master recommended denying the Motion for the 2017 RPAC minutes and materials. (ECF No. 267 at 3.) The Special Master credited Defendants' arguments that the 2017 RPAC minutes and materials are irrelevant because they post-dated the complaint by over a year and thus would not contain information about the fiduciary's decisionmaking process at the time of the decision, the request constituted a fishing expedition, and a ruling in Plaintiffs' favor could require Defendants to produce RPAC minutes and materials indefinitely. (ECF No. 264 at 3-5.) Plaintiffs argue that the materials are necessary to establish post-complaint liability and evaluate the consequences of Defendants' acts and omissions. (ECF No. 265 at 3.) Defendants have not produced any of the 2017 RPAC minutes or materials, unlike the partial production of the more temporally proximate 2016 RPAC minutes and materials. (Id.)

Recognizing the balance between production of relevant information and burden on the producing party, the Court agrees with the Special Master and finds that the burden of producing the 2017 RPAC minutes and materials, and the potential for producing such materials continually until the date of trial, outweighs the need for the 2017 materials, which, given the passage of time, are less likely to contain relevant information about RPAC's earlier decisionmaking. See Caban, 2000 WL 1480481, at *2. The Court therefore overrules Plaintiffs' objection to the Special Master recommendation and denies the Motion as to the 2017 RPAC m inutes and materials.

2. IC Minutes and Materials

Plaintiffs seek production of the IC minutes and materials from 2016 and 2017. In doing so, they rely on a prior order of the Special Master. Special Master Report No. 6 (adopted by this Court without objection) recommended the production of "unredacted minutes of meeting involving those serving as Plan fiduciaries together with the materials distributed at those meetings." (ECF No. 238 at 5.) Plaintiffs argue that the IC is a "Plan fiduciary," whose minutes and associated materials must be produced. (ECF No. 258 at 4; ECF No. 265 at 5; ECF No. 269-1 at 5-6.)

Defendants contend that the IC did not have direct fiduciary oversight over the Plan but rather, as an authorized committee of the Board, received updates about the 401(k) Plan for purposes of monitoring the CEO. (ECF No. 264 at 3; ECF No. 272 at 3-4.) Defendants add that they have already produced "relevant IC materials that relate to the monitoring of the CEO and Plan." (ECF No. 272 at 4.) The Special Master credited Defendants' arguments about the IC minutes and materials, and stated that they served as a basis for denying Plaintiff's Motion. (ECF No. 267 at 2.)

The Court agrees with Banner on this matter and will not compel production of the IC minutes and materials. First, while the Special Master Report No. 6 ordered that all "Plan fiduciary" minutes to be produced, the IC was not within the scope of that order. In the briefing prior to Report No. 6 (which this Court adopted in full), "Plan fiduciary" was not defined to include the IC. Indeed, Plaintiffs' own brief identified the RPAC as the Plan's named fiduciary and characterized individual defendant Board members as "Plan fiduciaries [who] serve on the Banner Health Investment Committee." (ECF No. 230 at 4, n.5.) The IC was not within the scope of "fiduciaries" under Report No. 6. Plaintiffs may not rely on other documents to expand Report No. 6 to include the IC minutes and materials.

In addition, Plaintiffs have failed to establish the relevance of the IC minutes and materials. See Meeker, 2015 WL 5244947, at *2. The IC is not a Plan fiduciary, and Defendants state that they have produced the IC materials that relate to supervision of the 401(k) plan. The Court finds that the remainder of the 2016 and 2017 IC minutes and materials have little to no relevance to Plaintiffs' claims and would be unduly burdensome to produce. Thus, the Court overrules Plaintiffs' objection and denies Plaintiffs' Motion as to the IC minutes and materials.

3. Quarterly Plan Asset Balances and Plan Participation Counts from Quarter Two of 2015 to Present

Plaintiffs seek quarterly updates of Plan asset balances and Plan participation counts from the second quarter of 2015 to present. They contend that this information is necessary for two purposes: determining appropriate injunctive relief and calculating damages. (ECF No. 269-1 at 7-9.)

Banner states that the relevant information through 2015 has already been produced and post-2015 production is premature, and thus the request unnecessary and unduly burdensome. It urges the Court to defer production of such materials pending the outcome of the case. (ECF No. 264 at 5-6.) The Special Master recommended against bifurcating discovery. (ECF No. 267 at 2.) He also recommended denying production of these materials because they would be created on an ongoing basis, and thus would also have to be produced on a rolling basis, continuing indefinitely. (Id. at 3.) While Plaintiffs objected, Banner did not address the Special Master's recommendation or respond to Plaintiffs' objection.

The requested materials are plainly relevant to Plaintiffs' claims and are documents which will allow them to discover information relevant to support their case. See Meeker, 2015 WL 5244947, at *2. If Plaintiffs prevail, they will be entitled to some form of relief. Information about asset balances and Plan participants counts would be relevant to monetary relief and could also assist the Court in determining other appropriate relief.

Banner has not established that production is unduly burdensome or irrelevant to Plaintiffs' claims. Rather, Banner's arguments acknowledge that such information is relevant to an appropriate remedy, should Plaintiffs prevail. And Banner's proposal to bifurcate discovery would likely be more burdensome than allowing all discovery to occur at once. Banner has not articulated a principled ground for denying Plaintiffs' request for quarterly asset balances or Plan participation counts. See Clay, 2017 WL 4755152, at *2. Thus, the Court sustains the Plaintiffs' objection on this matter and will grant Plaintiffs' Motion to compel quarterly Plan asset balances and Plan participation counts.

The Court is also cognizant of creating an ongoing burden of production on Defendants, who will likely continue to create such information in the course of business. Thus, to manage the discovery process, the Court will limit discovery of information regarding the quarterly asset balances and Plan participation counts to the deadline for fact discovery, November 30, 2017. (ECF No. 199 at 17.) See United States ex rel. Conroy, 307 F. Supp. 3d at 906.

4. Audit Spreadsheet

Plaintiffs ask for clarification of Report No. 7 regarding the audit spreadsheet. They contend that the Special Master recommendation is either unclear or directed Banner to produce the spreadsheet. (ECF No. 269-1 at 9.) The Special Master recommendation stated the following regarding the audit spreadsheet:

(ECF No. 267 at 2.) It also more generally stated that:

(Id. at 3.)

Plaintiffs construe the Special Master recommendation that "the remaining materials be produced" to include all documents not otherwise directly addressed in Report No. 7. (ECF No. 269-1 at 9.) Banner argues that Report No. 7 "expressly considered whether Plaintiffs were entitled" to the spreadsheet, but does not state the Special Master's recommendation. (ECF No. 272 at 7.) Banner construes the Special Master's recommendation to produce the remainder of the 2016 RPAC materials as excluding the audit spreadsheet. (Id.)

The Court agrees with Plaintiffs that Report No. 7 is unclear and finds that it did not address Plaintiffs' request for the audit spreadsheet. Thus, this Court will decide the matter in the first instance.4

Plaintiffs seek production of a spreadsheet that reflects administrative fees allegedly improperly paid by the Plan between 2012 and 2016. Banner makes two arguments against production: (1) the complaint encompasses only duplicative fees for administrative services, not administrative errors resulting in excessive fees, and (2) Plaintiffs' claims cover 2009-2013, whereas the audit focuses on improper fees from 2012-2016. (ECF No. 272 at 7-8.)

Defendants arguments against production are unavailing. Courts broadly construe relevancy at the discovery stage, and "a request for discovery should be considered relevant if it is possible that the information sought may be relevant to the claim or defense of any party." Tara Woods Ltd. P'ship v. Fannie Mae, 265 F.R.D. 561, 568 (D. Colo. 2010); see also Meeker, 2015 WL 5244947, at *2. Plaintiffs allege that payments to Fidelity were excessive and that Banner failed to assure that compensation paid to Fidelity and Banner Health for administrative services was reasonable. (ECF No. 118 ¶¶ 76, 123.) While Plaintiffs focus on the duplicative nature of those services, Plaintiffs' claims of failure to assure reasonable compensation, broadly construed, may also encompass improperly paid administrative fees. Moreover, though the audit timeframe extends beyond the period alleged in the complaint, there are two years of overlap during which improper fees may have been paid (2012 and 2013). Therefore, the audit spreadsheet is relevant to Plaintiffs' claims of administration of funds and oversight of fees. Because the spreadsheet is a presumably singular document, the burden of production is, in the context of this litigation, low. The Court therefore grants the Motion as to the audit spreadsheet.

IV. CONCLUSION

For the reasons set forth above, the Court ORDERS as follows:

1. The Special Master's Report No. 7 (ECF No. 267) is ADOPTED IN PART and REJECTED IN PART;

2. Plaintiffs' Objection (ECF No. 269) to Special Master Report No. 7 is OVERRULED IN PART and SUSTAINED IN PART;

3. Plaintiffs' Motion to Compel (ECF No. 258) is GRANTED IN PART and DENIED IN PART;

4. Plaintiffs' Motion to Compel is GRANTED as to the following documents:

5. Plaintiffs' Motion to Compel is DENIED in all other respects.

6. By no later than September 10, 2018 the Banner Defendants SHALL PRODUCE the documents listed in 4.a, 4.b, and 4.c, above. This Order in no way limits Banner Defendants' ability to appropriately redact or withhold such documents for privilege only, consistent with the prior recommendation of the Special Master (ECF No. 232) adopted by this Court (ECF No. 237).

7. The Court emphasizes that its ruling in this Order shall not be treated as an invitation to the Parties to ask the Court to reconsider any other already-decided discovery issue, re-open fact discovery, or compel additional fact discovery.