United States District Court, W.D. Oklahoma
JANE B. GRIGGS, as Personal Representative of the Estate of Richard O. Bertschinger, Sr., deceased, Plaintiff,
THE VANGUARD GROUP, INC., and VANGUARD MARKETING CORP., Defendants.
L. PALK UNITED STATES DISTRICT JUDGE
the Court is Plaintiff's Motion to Compel Discovery
Responses [Doc. No. 47]. It is at issue. See Resp.,
Doc. No. 65; Reply, Doc. No. 69. After Defendants removed
this case to this Court, they requested that Plaintiff's
claims against Vanguard Marketing Corp. be compelled to
Financial Industry Regulatory Authority (“FINRA”)
arbitration and that Plaintiff's claims against Vanguard
Group, Inc. be dismissed. Plaintiff then put the
“making” of the alleged arbitration agreements at
issue, so the Court authorized limited-scope discovery in
advance of the determination required by 9 U.S.C. § 4.
See Order of Oct. 31, 2018, Doc. No. 27. The only
question on which discovery has been authorized in this case
is whether Mr. Bertschinger lacked mental capacity to enter
into the arbitration clauses at issue-which were executed by
Mr. Bertschinger on August 11, 1999 and on September 4,
2001. See Doc. Nos. 10-2, 10-4.
Relevant discovery standard
Rule of Civil Procedure 26(b)(1) applies to Plaintiffs'
motion, and it provides in relevant part:
Parties may obtain discovery regarding any nonprivileged
matter that is relevant to any party's claim or defense
and proportional to the needs of the case, considering 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
requested discovery appears relevant, the party objecting to
production has the burden of establishing the lack of
relevance by demonstrating that the request falls outside the
scope set forth in Rule 26(b)(1), or that the requested
discovery is of such marginal relevance that the potential
harm occasioned by discovery would outweigh the ordinary
presumption in favor of broad disclosure.” Shotts
v. Geico Gen. Ins. Co., No. CIV-16-1266-R, 2017 WL
4681797, at *1 (W.D. Okla. Oct. 17, 2017) (citation omitted).
Discussion and analysis
capacity to contract is evaluated as of the date of the
contract's execution. See Evans v. First Nat'l
Bank of Stillwater, 146 P.2d 111, 113 (Okla. 1944)
(“[T]he test of the capacity to make a contract is
whether the party had the ability to comprehend in a
reasonable manner the nature and effect of the act in which
he engaged and the business he transacted.” (quotation
marks and citation omitted) (citing Charley v.
Norvell, 221 P. 255 (Okla. 1924))); cf.
Charley, 221 P. at 257 (“It must be borne in mind
that at the time the release was executed in the case at bar
the plaintiff was of full age, and the presumption of
contractual capacity cannot be overthrown merely . . . by the
fact that a short time after the release was executed a
guardian was appointed by the county court on the ground of
improvidence.”). This time-of-transaction evaluation is
applicable regardless of whether New York, Oklahoma, or
Pennsylvania law applies to the issue of mental
capacity. See Cardinal v. Kindred Healthcare,
Inc., 155 A.3d 46, 50 (Pa. Super. Ct. 2017)
(“Where mental capacity to execute an instrument is at
issue, the real question is the condition of the person at
the very time he executed the instrument in question.”
(quotation marks omitted) (quoting Estate of McGovern v.
Pa. State Emps. Ret. Bd., 517 A.2d 523 (Pa. 1986),
overruling on other grounds recognized by Vine v. Pa.
State Emps. Ret. Bd., 9 A.3d 1150 (Pa. 2010)));
Sears v. First Pioneer Farm Credit, 850 N.Y.S.2d
219, 222 (N.Y.App.Div. 2007) (“[T]o prevail, plaintiffs
had to demonstrate that [the alleged-to-be- incapacitated
person's] mind was so affected as to render him wholly
and absolutely incompetent to comprehend and understand the
nature of the transaction and, further, that such
incompetency/incapacity existed when he executed the loan
documents . . . .” (quotation marks and citations
asserts that the time period relevant to the issue of mental
capacity is broader, at least if New York law applies.
Pointing to Ortelere v. Teachers' Retirement
Board, Plaintiff stresses that case's reliance on
the Restatement (Second) of Contracts and part of its test
for a voidable contract: “(1) A person incurs only
voidable contractual duties by entering into a transaction if
by reason of mental illness or defect . . . (b) he is unable
to act in a reasonable manner in relation to the transaction
and the other party has reason to know of his
condition.” 25 N.Y.2d 196, 204 (1969) (quotation marks
omitted). Under this standard, Plaintiff asserts
that Defendants' knowledge of Mr. Bertschinger's
capacity is relevant, opening up the period before (and,
according to Plaintiff, the period after) Mr. Bertschinger
executed the August 1999 and September 2001 documents to
reaching the issue of what State's laws apply, the Court
agrees with Plaintiff that Defendants' knowledge of Mr.
Bertschinger's mental capacity to enter into the
arbitration clauses at issue in August 1999 and September
2001 is relevant and is likely to be revealed by
communications between Defendants and Mr. Bertschinger, at
least for the periods before the agreements were executed-as
well as, as previously determined, for the period of time
extending to three months after the latter of agreements at
issue in this case: December 4, 2001. See Order of
May 7, 2019, at 6, Doc. No. 45. That is, Defendants'
knowledge in August 1999 and September 2001-based on their
prior interactions with Mr. Bertschinger-is relevant
regardless of whether Oklahoma or New York law applies.
the Court does not see the relevance-as to the limited issues
on which discovery has been authorized-of communications
between Defendants and Mr. Bertschinger that took place after
December 4, 2001. Such communications do not shed light on
Mr. Bertschinger's mental capacity in August 1999 or
September 2001; nor do they show what knowledge of Mr.
Bertschinger's mental capacity Defendants had during
those same prior periods. In light of these general
determinations, the Court turns to Plaintiff's individual
Plaintiff's Interrogatory No. 1 and Request for
Production No. 1
Plaintiff seeks recordings of communications between Mr.
Bertschinger and Defendants' employees or representatives
from January 1, 1998, through October 4, 2016 (Mr.
Bertschinger's date of death), along with
“identification of the software requirements for
accessing such data, and the manner of storage and backup of
all such data.” Pl.'s Interrog. No. 1, Doc. No.
47-1. The Court is inclined to grant Plaintiff's request
for production of communications-but only as to
communications had from January 1, 1998, through December 4,
2001 (three months after Mr. Bertschinger executed the second
agreement at issue in this case). As Defendants have
indicated that they do not have any recordings from before
November 2010-due to their document destruction policy that
was in place prior to them being served with this lawsuit-no
recordings exist for the Court to compel production of.
Plaintiff's request is therefore denied.
Plaintiff's request for Defendants' audio recording
policies and data storage policies, the Court does not see
any relevance between them and the issues on which discovery
has been authorized. Even if Defendants (i) had policies in
place that they violated (as Plaintiff seems to hypothesize)
or (ii) did not have policies in place that they should have
had under FINRA regulations, such violations do not reveal
any relevant information regarding Mr. Bertschinger's
mental capacity at the relevant times, or even
Defendants' knowledge about his mental capacity at such
times. Plaintiff's request is therefore
Plaintiff's Interrogatory Nos. 2-3 and Request ...