United States District Court, E.D. Michigan, Southern Division
ORDER DENYING WINGET'S MOTION TO COMPEL (Doc.
COHN UNITED STATES DISTRICT JUDGE.
a commercial dispute which resists closure. J. P. Morgan
Chase (Chase) is the administrative agent for a group of
lenders that extended credit to Venture Holdings Company, LLC
(Venture) under a credit agreement. In 2008, Chase sued Larry
J. Winget (Winget) and the Larry J. Winget Living Trust
(Winget Trust) to enforce a Guaranty and two Pledge
Agreements entered into by Winget and signed by Winget and
the Winget Trust in 2002, guaranteeing the obligations of
Venture. After years of litigation and multiple appeals, on
July 28, 2015, the Court entered an Amended Judgment in favor
of Chase and against Winget and the Winget Trust that
enforced the Guaranty and Pledge Agreements against Winget
and the Winget Trust. Specifically, the judgment against the
Winget Trust was in the amount of $425, 113.115.59. The
judgment against against Winget was limited to $50 million.
(Doc. 568). Because Winget later satisfied his portion of the
judgment, Chase began collection efforts against the Winget
Trust. Winget then revoked the Winget Trust and then filed a
separate action seeking a declaration that the Winget Trust
had no remaining obligations to Chase. Chase filed several
counterclaims, asserting that the revocation was fraudulent.
Winget demanded a jury on the counterclaims. The Court later
consolidated the declaratory action and Chase's
counterclaims with this case. The Court has ruled that the
transfer amounted to constructive fraud. (Doc. 732). Since
that time, Chase has been pursuing collection efforts against
the Winget Trust and discovery as to the assets in the Winget
the Court is Winget's Motion to Compel the deposition of
Phillip Martin. (Doc. 827). For the reasons that follow, the
motion will be denied.
Federal Rule of Civil Procedure 26(b)(1), discovery is
permitted of “any nonprivileged matter that is relevant
to any party's claim or defense.” Rule 26(b) is to
be liberally interpreted to permit wide-ranging discovery of
information, even if that information is not ultimately
admitted at trial. See also Fed.R.Civ.P. 26(b)(1)
(“[r]elevant information need not be admissible at the
trial if the discovery appears reasonably calculated to lead
to the discovery of admissible evidence.”). To
determine the proper scope of discovery, a district court
should balance a party's “right to discovery with
the need to prevent ‘fishing expeditions.' ”
Conti v. Am. Axle & Mfg., 326 Fed.Appx. 900, at
*907 (6th Cir. May 22, 2009 (quoting Bush v. Dictaphone
Corp., 161 F.3d 363, 367 (6th Cir. 1998)).
seeks to compel the deposition of Phillip Martin, the Chase
employee who is responsible for the defaulted loan which was
the subject of the Guaranty.
says that despite the fact that Martin has already been
deposed twice in the case and fact discovery is closed, it
does not oppose making Martin available for a third
deposition regarding relevant topics. To that end, Chase
agreed to make Martin available for deposition should Winget
seek discovery on the interest calculations underlying
Chase's Motion to Amend Judgment because the issue has a
bearing on the amount of damages Chase may seek at trial.
Chase remains willing to have Martin testify on this topic.
however, asserts that Martin could provide testimony
“potentially relevant to both Winget's mindset when
he revoked his trust, and to the balancing of the equities
with regard to the alleged harm caused to Chase by that
revocation.” (Doc. 827 at 6.) Winget says that there is
“a strong possibility” that Martin has
information relevant to determining “whether ... Winget
acted with the intent to defraud Chase when he revoked his
Trust.” (Doc. 827 at 8.)
motion lacks merit. First, the Court has already determined
that Winget is liable for constructive fraudulent transfer,
as to which intent is not an element. Thus, the question at
trial will be the amount of damages Chase suffered due to the
fraudulent transfer. Winget's state of mind is
even if Winget's intent were relevant, Martin's work
on a credit file does not provide Martin with information as
to Winget's thinking in revoking the Trust in 2014.
Winget's description of Martin as the “point
man” in Chase's relationship to the Winget Trust
does not give Martin knowledge of Winget's state of mind
when he engaged in the 2014 transactions. Indeed, Martin (and
the Court) did not even learn of Winget's 2014 revocation
until a year and half later, in July 2015, and only then
through counsel. Martin has had no direct interaction or
contact with Winget relating to those issues or anything
else. To the extent the issue of Winget's
“intent” is pertinent, the appropriate witness is
also appears to contend that Martin may have information that
would support an equitable adjustment to any potential
damages award against Winget. Winget suggests this
information might relate to the “actions or inactions
of Chase and the lending group” (Doc. 827 at 10).
Winget, however, has not identified what “actions or
inactions” might support such equitable adjustments.
Winget's conclusory assertions fail to show that ...