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Van Stelton v. Van Stelton

United States District Court, Eighth Circuit

October 9, 2013

VIRGIL VAN STELTON, et al., Plaintiffs,
v.
JERRY VAN STELTON, et al., Defendants.

ORDER IMPOSING SANCTIONS

LEONARD T. STRAND, Magistrate Judge.

"With all due respect, I am the client, and I'm in charge." - Defendant Daniel DeKoter, while refusing to answer questions during his deposition. [1]

I. INTRODUCTION

Plaintiffs have filed two motions for discovery sanctions and contempt sanctions - one against defendant Daniel DeKoter (Doc. No. 131) and one against defendant Douglas Weber (Doc. No. 133). Both motions are based on refusals to answer questions about certain topics during depositions. Weber and DeKoter have filed resistances (Doc. Nos. 147 and 150). While plaintiffs have requested oral argument, I find that oral argument is not necessary. See Local Rule 7(c). As set forth below, the behavior by the witnesses and/or their counsel was so obviously improper that oral argument would serve only to cause further expense and delay.

II. BACKGROUND

Many prior orders have described this case's rather-complex background in great detail. See, e.g., Doc. 105 and 128. I will recite background here only to the extent necessary to establish context relevant to the present motions.

Plaintiffs' Current Claims. The defendants filed motions to dismiss various claims in this case (which are currently described in the third amended complaint). Weber, along with defendants Scott Gries, Nate Krikke, Robert Hansen and Osceola County, Iowa (collectively the County defendants) sought dismissal of Count II (RICO) as to all plaintiffs; Count V (slander and libel) as to plaintiff Carol Van Stelton; and Count VI (tortious interference with prospective business relations) as to all plaintiffs. Meanwhile, DeKoter and his law firm, defendant DeKoter, Thole, and Dawson, P.L.C. (the Law Firm defendants), sought dismissal of all claims against them.

On July 17, 2013, Judge Bennett ruled (Doc. No. 105) on the motions to dismiss. Judge Bennett granted the motions with regard to certain claims but denied them with regard to others. At the conclusion of the ruling, he provided the following summary of the outcome with regard to claims against the County defendants and the Law Firm defendants:

1. The County defendants' motion to dismiss is granted, and the following claims against the County defendants are dismissed:
a. the RICO claim;
b. the First Amendment right to petition claim;
c. Carol Van Stelton's slander and libel claim;
d. the tortious interference with prospective business relations claim;
e. the Iowa Ongoing Criminal Conduct (OCC) claim.
2. The Law Firm defendants' motion to dismiss is granted in part and denied in part, as follows:
a. That part of the motion seeking dismissal of the § 1983 claims against DeKoter is denied;
b. That part of the motion seeking dismissal of the § 1983 claims against the Law Firm is granted;
c. That part of the motion seeking dismissal of the RICO claims is granted;
d. That part of the motion seeking dismissal of Virgil Van Stelton's false arrest claim is denied;
e. That part of the motion seeking dismissal of the malicious prosecution claim is denied;
f. That part of the motion seeking dismissal of the defamation claim against them is granted;
g. That part of the motion seeking dismissal of the tortious interference with prospective business relations is denied;
h. That part of the motion seeking dismissal of the fraud claims is granted;
i. That part of the motion seeking dismissal of the breach of fiduciary duty claim is denied;
j. That part of the motion seeking dismissal of the OCC claim is granted.

Doc. No. 105 at 55-56.

In denying the motion to dismiss plaintiffs' Section 1983 claim against DeKoter, Judge Bennett explained plaintiffs' allegations as follows:

[P]laintiffs allege that DeKoter controls and directs a symbiotic relationship with [Osceola County Attorney Robert] Hansen and [Osceola County Sheriff Doug] Weber. In this relationship, DeKoter directs Hansen and Weber to selectively enforce criminal laws and ordinances to benefit the Law Firm's clients and used their official positions to suppress local political activities in order to maintain the balance of power within the county. In return for their actions, Hansen and Weber are rewarded with excessive compensation. Their overcompensation is allegedly assured through DeKoter's law partner's advice to the Osceola County Board of Supervisors in his role as its compensation counsel. Plaintiffs specifically allege that DeKoter orchestrated Virgil [Van Stelton]'s false arrest with County Attorney Hansen as a pretext to seize Virgil's tape recorder. Thus, plaintiffs allege a concerted plan between DeKoter and the County defendants to violate due process rights. Taking these allegations of joint activity as true, they are sufficient to make DeKoter a state actor liable under § 1983.... This portion of the Law Firm defendants' motion to dismiss is denied as to DeKoter.

Id. at 21-22 [emphasis added; citations omitted].

Earlier in his ruling, Judge Bennett explained that the "local political activities" DeKoter allegedly sought to suppress involved Osceola County's "Unified Law." Plaintiffs allege that Osceola County allocates its real estate tax proceeds under the Unified Law. They further allege that the Law Firm's predecessor entities were instrumental in the County's implementation of the Unified Law. While the County's rural taxpayers allegedly pay the majority of the County's property taxes, the Unified Law has allegedly been administered to "provide disproportionate benefits" to the City of Sibley (which is the county seat) and disproportionate funding of Osceola County's central administration. Plaintiffs allege that the Unified Law continues to be followed in Osceola County even though it has been repealed or its term has expired. They contend that Sibley's taxpayers benefit from the Unified Law by receiving a disproportionate allocation of tax funding.[2] For that reason, allegedly, residents of Sibley support the Unified Law in order to maintain a reduced tax burden. Doc. No. 105 at 5.

Plaintiffs allege that some of the County's rural residents have formed an organization called Osceola County Taxpayers Association (OCTA) to investigate and challenge the Unified Law. They contend that all three plaintiffs have been known to associate with OCTA and that plaintiff Virgil Van Stelton is active in the organization. Meanwhile, they allege, DeKoter has actively and publicly opposed OCTA and its objectives. They contend that DeKoter has used his relationship with Weber (the Sheriff) and Hansen (the County Attorney), along with his own status as attorney for a Van Stelton family trust, to punish the plaintiffs for their political activities in opposition to the Unified Law. Among other things, plaintiffs contend DeKoter caused Alvin Van Stelton to be removed as a trustee of the family trust and caused the false arrest of Virgil Van Stelton. They also contend that DeKoter took, or directed, various actions as part of a scheme to prevent Virgil and Alvin from inheriting land and realizing income from the family trust. Id. at 10-12, 45-46.

Of course, these are all just allegations. I take no position as to their merit. However, Judge Bennett found the allegations to be sufficient to overcome DeKoter's motion to dismiss several claims, including the Section 1983 claim and claims for false arrest, malicious prosecution and tortious interference with prospective business advantage. Moreover, as noted above, neither Weber nor the other County defendants even sought dismissal of the remaining claims. All of these claims were pending on August 19 and 20, 2013, when DeKoter and Weber were deposed.

The Counterclaim. On July 31, 2013, Weber and the other County defendants filed an answer (Doc. No. 108) to the third amended complaint, along with a counterclaim against plaintiffs. In the counterclaim, the County defendants allege that various claims in the third amended complaint are frivolous and that plaintiffs filed that document for an improper purpose. The County defendants further allege that they have been injured by the plaintiffs' alleged abuse of process and seek an award of actual and punitive damages. While plaintiffs have moved to dismiss the counterclaim, it remains pending and was part of the case when Weber was deposed.[3]

The Pre-Deposition Motions. On August 8, 2013, the County defendants filed a motion (Doc. No. 109) to quash subpoenas and for a protective order. On August 9, 2013, the Law Firm defendants filed a similar motion (Doc. No. 111). The motions noted that depositions of DeKoter, Weber and Hansen were scheduled for August 19, 20 and 21 and that plaintiffs' counsel had recently served deposition subpoenas on the deponents that included demands for the production of documents. The motions asked that the subpoenas be quashed. The motions further requested entry of a blanket protective order declaring that certain topics, including "issues surrounding funding and administration of the unified law, " be placed off-limits during the depositions and all other discovery in this case. See Doc. No. 109-1 at 4-5, Doc. No. 111-1 at 4.

I addressed the motions on an expedited basis and conducted a telephonic hearing on August 16, 2013. I entered an order (Doc. No. 119) on the same day. I granted the motions with regard to the document requests contained in the subpoenas, pointing out that any attempt to obtain documents from a party in connection with a deposition is governed by Rule 34, which provides a 30-day period of time for responding. Doc. No. 119 at 2. Because plaintiffs attempted to circumvent this rule with subpoenas served less than 30 days before the depositions, I quashed those subpoenas "to the extent they purport to require defendants Weber, Hansen and Dekoter to produce documents at their depositions on August 19, 20 and 21." Id.

However, I denied defendants' anticipatory request for entry of an order limiting the scope of questioning during the depositions. I deemed the request to be premature and explained:

With regard to the scope of questioning at the upcoming depositions, all parties know which claims and allegations are currently part of this case. And, of course, the scope of permissible discovery is broad. Fed.R.Civ.P. 26(b)(1). Reasonable people can, and often do, disagree as to the relevance of specific information in the course of discovery. For the most part, even if counsel for a deponent is convinced that a question seeks irrelevant information, the correct course of action is to allow the witness to answer. An attorney may "instruct a deponent not to answer only when necessary to preserve a privilege, to enforce a limitation ordered by the court, or to present a motion under Rule 30(d)(3)." See Fed.R.Civ.P. 30(c)(2). A motion under Rule 30(d)(3) is appropriate only when a deposition "is being conducted in bad faith or in a manner that unreasonably annoys, embarrasses, or oppresses the deponent or party." See Fed.R.Civ.P. 30(d)(3).
At this point, it is simply not prudent or proper for me to give advisory opinions as to which questions, or topics, might or might not be appropriate during the depositions. If any attorney determines, in good faith, that a motion under Rule 30(d)(3) is necessary, then he or she can instruct the deponent not to answer the question or questions at issue. The examination should then move on to other topics, with the motion being presented as soon as practicable after the deposition. At that point, at least, there will be a record with one or more specific questions about which the parties may present arguments. Of course, if the motion is denied, and the question(s) at issue deemed appropriate, the examining party would be allowed to reconvene the deposition, most likely at the deponent's expense.

Id. at 2-3. With this guidance (which, even in hindsight, I find unambiguous), the depositions took place as scheduled the following week.

III. DEKOTER'S DEPOSITION

DeKoter's deposition on August 19, 2013, was the first of the three. Plaintiffs were represented during the deposition by their counsel of record, Wendy Nora and Thomas Frerichs. DeKoter was represented by his attorney of record, James Redmond. DeKoter Tr. 3. DeKoter testified that he has practiced law in Sibley for 33 years, that he is licensed to practice law in Iowa and that he is admitted to practice in this court. Id. 6-7, 25. Minutes after his deposition commenced, the following exchange occurred:

Q [By Ms. Nora] Thank you. Now, tell me what you know about Don Skiver's relationship to what is called unified law locally in Osceola County.
A Unified law isn't in this case anymore, ma'am.
Q I'm sorry, sir. You are represented by counsel. If you have an objection, then your counsel is going to have to make the objection.
A No, ma'am. No, ma'am. I'm not going to answer questions about unified law today. It's not in this case.
MS. NORA: Is that your position, Mr. Redmond?
MR. REDMOND: You heard the witness.
MS. NORA: I'm afraid I'm going to have to have counsel make the objection for the record.
MR. REDMOND: I don't think so.
Q Okay. Let's talk about why you think unified law is - I think my co-counsel wants to confer on this.
(Discussion held off the record between Ms. Nora and Mr. Frerichs.
MS. NORA: Is it counsel's position for the witness that counsel is not interposing an objection to the question that I posed?
MR. REDMOND: I haven't made an objection.
MR. FRERICHS: Here's the thing that I'm concerned about. In the magistrate judge's last order it said that if you are going to object and not answer a question, that counsel needed to object and advise the person not to answer the question. If we're not going to follow that procedure, I think that we probably should get Judge Bennett[4] involved sooner rather than later so we don't have to deal with it again.
THE WITNESS: With all due respect, I am the client, and I'm in charge.
MR. FRERICHS: I understand that, but that's not what Judge Strand's order is. That's all I'm saying. I think procedurally we need to follow Judge Strand's order.
THE WITNESS: I don't think he ordered anything.
MR. FRERICHS: I think he set forth a pretty clear procedure as for what we do. Quite frankly, I don't think any of us want to get Judge Bennett involved in this thing, but if we have to, we have to.
MR. REDMOND: That's your prerogative.
MS. NORA: I think he meant at this particular moment, so early on. We would like to develop more of a record here so that we don't call on every dispute that may come forward here.
MR. REDMOND: I understood his statement.
MS. NORA: Thank you.
MR. REDMOND: I also participated along with you in the hearing, and I understood perfectly what Judge Strand was saying. Now, you're entitled to contact Judge Bennett, whatever you want to do. Mr. DeKoter has told me in no uncertain terms he does not intend to get into the 28E[5] issues. So, you know, you have your options. You can continue with the deposition, or get Judge Bennett, or go into the other issues, or however you choose to proceed. I'm not telling you what to do or how to do it.
MR. FRERICHS: I guess what I'm saying is I think there has to be some kind of advice of counsel involved in the thing and, of course, we're not entitled to know that, but I think that he's got to - he has got to advise his counsel. I think counsel has got to then say, hey, I'm advising him not to answer it.
MS. NORA: In other words, we would like to hear your objection, and then we would like you to instruct your witness not to answer. You're smiling and shaking your head.
MR. REDMOND: I don't think I have to make a record beyond what I already have. I mean, I understand what you would like me to do, but it's not going to happen, so you have options available to you. You can proceed with the deposition on the issues that are covered, or not do so.
* * *
MS. NORA: But you're saying that - your position is that those issues are not before the Court. Our position is that they are. So should we have a general objection to any 28E questions that we would reopen the deposition to proceed upon? You could have a standing objection, but I would still like to get the specific questions on the record. So far counsel is not objecting. The witness is objecting.
MR. REDMOND: I'm not going to tell you how to proceed with your deposition.
MR. FRERICHS: Judge Strand's order basically said that an attorney may instruct a deponent not to answer only when necessary to preserve a privilege, enforce a limitation, or ordered by the Court, or present a motion under Rule 30(d)(3). So I guess what we're asking is, what's the basis? Is it to enforce a privilege? To enforce a limitation by court order? Or is it to present a motion under rule 30D3?
THE WITNESS: I'm objecting. Not the attorney. So what he says there doesn't apply to me. I'm the witness. Secondly, what you need to understand is that -
MS. NORA: Just -
THE WITNESS: I'm entitled to finish here, I think. First of all, it's not part of the case. It's not relevant. Secondly, you are doing this solely for purposes of harassment of me. This whole lawsuit is about that.
And I do think -
MS. NORA: Who is you? When you said you are doing this, who is you?
THE WITNESS: You, and you, and them (indicating).
MS. NORA: So everyone who is proceeding in this lawsuit, counsel and the plaintiffs have brought this lawsuit just to harass you, Mr. DeKoter?
THE WITNESS: No. I think you have financial motivations, too, ma'am. I don't care to get into that, but the objection I was making was, I also think that inquiry into my exercise of my political rights, my free speech rights, which is what you intend to do, would violate -
MS. NORA: How do you know what I intend to do?
THE WITNESS: - would violate my 1st amendment rights. That's where I'm at. I'll shut up. Sorry.
Q Are you asserting a 5th amendment privilege here?
A No, ma'am.
Q Okay. So you are saying that anything that inquires into the exercise of your 1st amendment right, you don't have to answer a question pertaining to that?
A I don't think I made that broad of a statement. I'm saying that the things that I have seen in the depositions that you've inquired about, and the things that I believe you are about to inquire about based upon the filings with the court, which is how I know what you're going to inquire about, by the way, would tell me that you're going to infringe on my rights. But, again, not relevant to this case, the Court has dismissed all the RICO claims. All this stuff about conspiracy is gone from this case at this point, so I think we should stick to the issues. That's all I'm saying.
MR. REDMOND: And just so we're clear, you seem to imply that if you don't pursue each of these individual questions about 28E, and get a non-response, that somehow or another you waive it. I don't think that -
MS. NORA: We don't want to -
MR. REDMOND: Let me finish. I don't think that that is ever contemplated in the rules. You have got all sorts of issues that remain.
MS. NORA: I don't need to be lectured on that. I do know all of those other issues.
MR. FRERICHS: I agree with him. I don't think we waive anything by moving on to another area, but I think under these circumstances you need to flesh it out a little bit more as to what exactly we want to address. Should we presume you are operating under a motion under Rule 30D3?
MR. REDMOND: You shouldn't presume any such thing. You should understand that Mr. DeKoter is an experienced trial lawyer. He has read all of the rulings. He has read all of the complaints, and the amended complaints, and the orders in this case. He considers 28E to be irrelevant to the issues in this case at this point, but he acknowledges that there are other issues that the judge has kept alive in the case. I'm not objecting. So I'm not directing him not to answer, but he has told me that he is going to refuse to answer those questions.
MR. FRERICHS: I understand, and I just want to flesh it out with the court's order, so I'm not trying to argue with you. I just want - so that means that it's not a Rule 33 - or 30D3 motion that you are acting pursuant to right now, correct?
MR. REDMOND: There is no motion.
MR. FRERICHS: It's also - there is no current limitation by the Court that you are acting under, is there?
MR. REDMOND: I think the current limitation of the Court is the ruling on the motion to dismiss. The Court has ruled and thrown out RICO, and 28E issues, and I understand that you still think somehow it's relevant, but that's your -
MR. FRERICHS: I understand. I just want to go through - is there any privilege that you are relying upon at this point?
MR. REDMOND: No.
THE WITNESS: No.
MR. FRERICHS: So basically you're acting to enforce the limitation of the court order on your motion to dismiss? That's the basis for refusing to answer.
THE WITNESS: To be clear, I am making the objection as the witness. I think what you're reading from the order is what Judge Strand says about attorneys. I don't think it ...

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