United States District Court, D. Minnesota
Katherine Menendez United States Magistrate Judge
matter is before the Court on the Plaintiffs' request to
compel compliance with a Rule 45 subpoena by non-party
Phillip A. Cole, an attorney with the Lommen Abdo law firm.
Mr. Cole asks the Court to Order the Plaintiffs to compensate
him for his time in responding to the subpoena. For the
reasons that follow, the Court grants the Plaintiffs'
motion to compel compliance with the subpoena and denies Mr.
Cole's request for an Order requiring payment.
Plaintiffs are attempting to collect on several million
dollars in separate judgments obtained years ago against
Defendant John Seibert and one of his companies, JFS
Development Inc., in the Northern District of Iowa. However,
Plaintiffs allege that they have been unable to collect on
those judgments because Mr. Seibert and his spouse, Defendant
Julie Seibert, have engaged in fraudulent transfers and other
fraudulent conduct to avoid paying the debt. Mr. Cole is
familiar with these proceedings, having represented Ms.
Seibert from at least July 1, 2016 (ECF No. 58), until
current defense counsel substituted into the case on July 25,
2017 (ECF No. 166).
discovery, as the Plaintiffs attempted to obtain information
relevant to the alleged fraudulent transfers, John and Julie
Seibert stated that certain financial decisions they made
were based on the advice of their attorneys. As the Court
recently explained, both John and Julie Seibert thereby
invoked an advice-of-counsel defense on behalf of themselves
and Trinity Business Consulting. As a result, they waived the
work-product protection and attorney-client privileges as to
several specific subject areas delineated by the Court.
(Order (Jun. 1, 2018), ECF No. 265.) Perhaps obviously,
Defendants' assertion of the advice-of-counsel defense
and the resulting waivers means that the Plaintiffs are
entitled to discover information from the attorneys who
allegedly advised the Defendants' conduct. To probe such
information, the Plaintiffs served a subpoena on Mr. Cole.
Given that this case will be tried in less than three months,
time is of the essence.
Dispute Over the Subpoena
Plaintiffs and Mr. Cole presented their dispute concerning
that subpoena to the Court by email. The relevant emails are
included in the Appendix attached to this Order.
(See App.) The Plaintiffs asked the undersigned to
intervene about Mr. Cole's request for payment before he
complies with the subpoena. (App. at A-2). The Court
construes the Plaintiffs' email as a motion to compel
production or inspection. Fed.R.Civ.P. 45(d)(2)(B)(i). In his
email to the Court, Mr. Cole asks: “Please consider
this email an objection under the Rule. . . .” (App. at
¶ 1.) He further states that he “hope[s] to avoid
appearing in court and plead[s] with the Court to rule upon
the issue with the communications in hand.”
(Id.) The Court construes Mr. Cole's emails as a
response in opposition to the Plaintiffs' motion to
emails, Mr. Cole does not argue that the Plaintiffs'
subpoena seeks irrelevant information, fails to allow a
reasonable time to comply, or requires him to comply beyond
the geographical limits specified in Rule 45(c). See
Fed. R. Civ. P. 45(d)(3)(A)(i)-(iii) (allowing the Court to
quash or modify a subpoena under certain circumstances). He
argues only that he should be compensated at his professional
rate for the time it takes him to respond to the
subpoena's commands. Specifically, Mr. Cole estimates
that it will take him three hours to review the file and
comply with the subpoena. Because his own hourly rate for
legal work performed on behalf of clients is $450/hour, he
asks the Court to require the Plaintiffs to pay him $1, 350
to cover his costs of complying with the subpoena.
(See App. at ¶ 5.) The Plaintiffs argue that no
such payment is required. (See Id. at A2-A3.)
requires a Court compelling compliance with a subpoena to
protect a person who is not a party from “significant
expense resulting from compliance.” Fed.R.Civ.P.
45(d)(2)(B)(ii). “‘Rule 45(d)(2)(b)(ii) requires
the district court to shift a non-party's costs of
compliance with a subpoena, if those costs are
significant.'” Balfour Beatty Infrastructure,
Inc. v. PB & A, Inc., 319 F.R.D. 277, 281 (N.D. Cal.
2017) (quoting Legal Voice v. Stormans Inc., 738
F.3d 1178, 1184 (9th Cir. 2013)). Whether a subpoena imposes
significant expense on a non-party depends on the
“‘circumstances of a particular case.'”
Id. (quoting Untied States v. McGraw-Hill Cos.,
Inc., 302 F.R.D. 532, 536 (C.D. Cal. 2014)).
the Rule requires a Court to protect the non-party from
significant expense, “[a] non-party can be required to
bear some or all of its expenses where the equities of a
particular case demand it.” In re Honeywell
Int'l, Inc. Sec. Litig., 230 F.R.D. 293, 303
(S.D.N.Y. 2003) (denying a request for costs of compliance
with a subpoena where the non-party was “not a classic
disinterested non-party” and offered no “basis
for determining the reasonable costs for compliance with the
subpoena”); Honda Lease Trust v. Middlesex Mut.
Assur. Co., No. 3:05-cv-1426 (RNC), 2008 WL 349239, at
*5 (D. Conn. Feb. 6, 2008) (“‘Typically, a
non-party is required to absorb the costs of complying with a
subpoena duces tecum. Generally, reimbursement only occurs
where the costs are great or the document demand unreasonably
broad.'”) (quoting Florida Software Systems,
Inc. v. Columbia/HCA Healthcare Corp., No. 99-MC-0036E,
2002 WL 1020777 (W.D.N.Y. Feb. 25, 2002)).
Cole has not demonstrated that the cost of compliance with
the Plaintiffs' subpoena or the three hours he estimates
it will take him to provide responsive documents amounts to a
“significant expense.” Mr. Cole asserts only that
complying with the subpoena will require him to spend time
examining his file to provide documents that are responsive
to the subpoena while not providing information that remains
privileged. But this is an ordinary incident of responding to
a subpoena, not a demonstration of significant expense. At
the heart of the matter, rather than a payment to offset
significant expense, Mr. Cole's request is to be
compensated for the loss of three hours that he could
otherwise spend earning an attorney's fee. However, that
is a cost of doing business, and the cost-shifting provisions
of Rule 45 do not kick in merely because a party may be
determining whether a subpoena imposes a significant expense,
courts also consider a non-party's “financial
ability to bear the costs of production.” Balfour
Beatty, 319 F.R.D. at 281. This consideration does not
support Mr. Cole's request. He did not present any
argument or proof to demonstrate that he cannot bear the
costs of production. Given that he bills his time at $450 per
hour, it seems unlikely that the costs associated with three
hours of gathering and reviewing documents for production
really amounts to a significant expense.