The opinion of the court was delivered by: JOHN M. CANNELLA
Plaintiffs Rand and LeWinter's appeal from the Order of Magistrate Judge Katz is denied. Fed. R. Civ. P. 72(a). Plaintiffs' motion to amend the class action order to allow withdrawal of named plaintiffs Rand, LeWinter, and Levy is denied. Fed. R. Civ. P. 23(c)(1).
Plaintiffs Rand and LeWinter appeal from an Order of Magistrate Judge Katz dated March 25, 1992, in which he granted the defendant Harcourt Brace Jovanovich's ("HBJ") request that the named plaintiffs in the instant class action suit produce (1) the complaint and transcript of any deposition the plaintiffs have given in other securities or class action suits, and (2) plaintiffs' brokerage statements showing trading in public securities during 1988 and 1989. Plaintiffs Rand, LeWinter, and Levy also seek to withdraw as class representatives. Defendants oppose both motions, asserting that the Magistrate Judge's determination of the relevancy of discovery documents must be upheld under the clearly erroneous or contrary to law standard of Rule 72; and that the withdrawal of Rand, LeWinter, and Levy when fact discovery is nearly complete will prejudice the defendants.
This securities fraud action represents the consolidation of class action complaints
filed against defendant HBJ and its officers and directors in the spring of 1990. Plaintiffs' claims are premised upon section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder, and upon section 20 of the Securities Act of 1933. On July 25, 1990, the Court certified the class of purchasers of HBJ common stock for the period March 30, 1989 through November 28, 1989. See Stipulation and Order, 90 Civ. 1318 (JMC) (S.D.N.Y. July 25, 1990). The Court certified six individuals as class representatives, including plaintiffs Rand, LeWinter, and Levy. See id. Samuel Heins was designated as Lead Counsel for the plaintiffs. See Stipulation and Order, 90 Civ. 1318 (JMC), at 6 (S.D.N.Y. May 9, 1990).
On January 21, 1992, the defendants served a document request on plaintiffs' Lead Counsel, addressed to all named plaintiffs. Lead Counsel objected to the document request on behalf of all plaintiffs. No separate objections were filed by Rand and LeWinter. Plaintiffs objected to document requests numbered five and seven. Request No. 5 sought the production of documents concerning any other securities law, class action, derivative, breach of fiduciary duty, or waste of corporate assets litigation to which the named plaintiffs were or had been a party. Request No. 7 sought to obtain documents identifying publicly-traded securities beneficially owned or controlled by the named plaintiffs, and documents relating to such securities for the five-year period from December 1984 through December 1989.
On March 19, 1992, defendants moved to compel production of the aforementioned documents from all named plaintiffs. On March 25, 1992, the Magistrate Judge heard argument on defendants' motion. During the March 25, 1992, hearing, the Magistrate Judge ruled that the named plaintiffs must produce (1) the complaint, and transcript of any deposition given in other securities law, class action, breach of fiduciary duty, or waste of corporate assets litigation to which the plaintiff has been a party, and (2) brokerage statements reflecting the plaintiffs' trading in publicly-traded securities during 1988 and 1989.
On April 6, 1992, plaintiffs Rand and LeWinter, through their individual attorneys, the Law Offices of Joseph H. Weiss, appealed from the Magistrate Judge's Order. Thereafter on April 22, 1992, plaintiffs moved for withdrawal of Rand and LeWinter as class representatives. On April 23, 1992, the Magistrate Judge granted the plaintiffs' application for a stay of enforcement of the Magistrate Judge's ruling concerning document requests as applied to plaintiffs Rand and LeWinter. See Memo Endorsed, 90 Civ. 1318 (JMC) (S.D.N.Y. Apr. 23, 1992). The Magistrate Judge also granted the plaintiffs' application for a stay of their depositions. See Memo Endorsed, 90 Civ. 1318 (JMC) (S.D.N.Y. May 7, 1992). On May 13, 1992, plaintiffs requested that a third named plaintiff, Frank Levy, be joined in the motion for withdrawal. See Letter to the Court from Samuel D. Heins, dated May 13, 1992. Defendants also oppose Levy's withdrawal as a named plaintiff. See Letter to the Court from John Sullivan, dated May 20, 1992. The Magistrate Judge granted the plaintiffs' request for a stay of bevy's deposition. See Memo Endorsed, 90 Civ. 1318 (JMC) (S.D.N.Y. May 20, 1992). The plaintiffs have stated that if the motion to withdraw is granted by the Court, then the plaintiffs will withdraw the pending Rule 72 motion. See Letter to the Court from Samuel D. Heins, dated April 22, 1992.
I. Appeal from the Magistrate Judge's Order
The Court's review of the Magistrate Judge's Order is governed by the clearly erroneous or contrary to law standard for non-dispositive pretrial matters contained in Rule 72(a). Rule 72(a) provides:
The district judge to whom the case is assigned shall consider such objections and shall modify or set aside any portion of the magistrate's order found to ...