Lupe Development Partners, LLC v. Deutsch

U.S. District Court, District of Minnesota November 13, 2024

Trial Court Opinion

             UNITED STATES DISTRICT COURT                            
                DISTRICT OF MINNESOTA                                


Lupe Development Partners, LLC,          Civ. No. 21-2668 (PAM/DTS)       
and Steven Minn,                                                          

          Plaintiffs,                                                

v.                                    MEMORANDUM AND ORDER                

Fred Deutsch, Deutsch Development                                         
Corp., Pacific Flats I LLC, and                                           
Pacific Flats II LLC,                                                     

          Defendants.                                                

This matter is before the Court on Plaintiffs Lupe Development Partners, LLC and 
Steven  Minn’s  timely  objections  to  the  Magistrate  Judge  David  T.  Schultz’s  Order 
denying Plaintiffs’ motion to depose the Scher Law Firm, LLP.  (Docket No. 78.)  Third-
party Penny Drue Baird responded to Plaintiffs’ objections.  (Docket No. 81.)  For the 
following  reasons,  Plaintiffs’  objections  are  overruled,  and  the  Magistrate  Judge’s 
decision is affirmed.                                                     
This standard of review for nondispositive decisions of a magistrate judge “is 
extremely deferential.”  Magee v. Trs. of the Hamline Univ.,

957 F.Supp.2d 1047, 1062

 
(D.  Minn.  2013)  (Tunheim,  J.);  see

28 U.S.C. § 636

(b)(1)(A)  and  D.  Minn. 
L. R. 72.2(a)(3).  “A ruling is clearly erroneous when the reviewing court is left with the 
definite and firm conviction that a mistake has been committed.  A decision is contrary to 
law when a court fails to apply or misapplies relevant statutes, case law or rules of 
procedure.”  Smith v. Bradley Pizza, Inc.,

314 F. Supp. 3d 1017, 1026

 (D. Minn. 2018) 
(citations and internal quotation marks omitted) (Wright, J.).  “If the magistrate judge’s 
account of the evidence is plausible in light of the record viewed in its entirety, the 

reviewing court may not reverse it even though had it been sitting as the trier of fact, it 
would have weighed the evidence differently.”  Meyer v. Haeg, Civ. No. 15-2564,

2016 WL 29257

, at *3 (D. Minn. Jan. 4, 2016) (Nelson, J.).
The extensive factual background has been set forth previously and need not be
revisited at this juncture. (See Docket Nos. 66, 78.) Relevant here, in December 2023,
the Magistrate Judge instructed that Plaintiffs could not pursue “further discovery into

Baird’s finances . . . absent new evidence of fraudulent or voidable transactions. They
have subjected Baird to multiple lawsuits and third-party subpoenas over the last thirteen
years, and in that time, they have uncovered scant evidence of any suspicious activity.”
(Docket No. 59 at 19.)
Plaintiffs then filed a motion seeking permission to subpoena and depose the Scher

Firm, which sued Baird and her children in 2009. (See Docket No. 78 at 1–2.) The
Magistrate Judge denied that motion, finding that it ran afoul of the previous Order, and
that, in any event, Plaintiffs could have raised this issue many years ago. (Id. at 3–5.)
Additionally, the Magistrate Judge imposed limited sanctions in the form of Baird’s costs
and fees in responding to the motion. (Id. at 5–6.)

Plaintiffs object to that decision, contending that their motion proposing a
subpoena to obtain information from a third party regarding Baird’s finances does not
violate the Court’s Order. But Plaintiffs allege no “new evidence of fraudulent or
voidable transactions,” as the Court required in order to obtain further discovery into
Baird’s finances. Plaintiffs contend that the Scher Firm’s deposition may potentially
reveal such evidence of fraud, but that possibility does not meet the prerequisite for

further discovery that the Court has ordered. Indeed, it is precisely the type of discovery
that the Court cautioned against.
Further, Plaintiffs assert that by filing a motion seeking permission to subpoena
the law firm, they demonstrated a special effort to comply with the Court’s Order.
However, asking the Court to deviate from its previous decision does not evince the
vigilance that Plaintiffs claim to display.

Finally, Plaintiffs argue that the effect of the Magistrate Judge’s Order would
prevent them “from undertaking any additional post-judgment discovery because the
potentiality that discovery might include information about Baird” and effectively
preclude them from collecting any of the outstanding judgment. (Docket No. 79 at 7.)
This view misconstrues the Court’s instructions, and is, as Plaintiffs themselves

characterize it, “a broad interpretation” of the Court’s strictures for discovery regarding
Baird’s and her company’s finances. (Id. at 7–8.)
Through the course of the parties’ litigation, multiple state and federal courts have
admonished Plaintiffs’ unrelenting tactics to obtain information regarding Baird’s
finances. (See Docket No. 74, App’x A at 1–2.) Plaintiffs’ methods fare no differently

here. As the Magistrate Judge ordered, limited sanctions are appropriate. Plaintiffs fail
to demonstrate any error, clear or otherwise, in the Magistrate Judge’s decision, and their
objections are overruled.
Accordingly, IT IS HEREBY ORDERED that:
1. Plaintiffs’ Objections (Docket No. 79) are OVERRULED; and

2. The Magistrate Judge’s Order (Docket No. 78) is AFFIRMED.

Dated: November 13, 2024 s/ Paul A. Magnuson
Paul A. Magnuson
United States District Court Judge