Unreported / Non-Citable
Background
Plaintiffs Brook Mancinelli and others sued Marriott International, Inc. in the Northern District of California. Marriott filed a potentially dispositive motion and moved to stay discovery pending its resolution, as reflected in ECF No. 67. The court began by emphasizing that the Federal Rules of Civil Procedure do not provide for automatic or blanket stays of discovery when a potentially dispositive motion is pending, citing Tradebay, LLC v. eBay, Inc., 278 F.R.D. 597, 600 (D. Nev. 2011).
The court then applied the two-pronged test used in the Northern District of California. First, a pending motion must be potentially dispositive of the entire case, or at least dispositive on the issue at which discovery is directed. Second, the court must determine whether the pending motion can be decided absent additional discovery. Only if both factors are met may a court consider issuing a stay. In applying this test, the court must take a preliminary peek at the merits of the pending dispositive motion to assess whether a stay is warranted, as stated in Singh v. Google, Inc., No. 16-CV-03734-BLF, 2016 WL 10807598, at *2 (N.D. Cal. Nov. 4, 2016).
The Court’s Holding
The court denied Marriott's motion to stay discovery. Having taken a preliminary peek at the merits of Marriott's motion, the court was not convinced that the motion was likely to dispose of the entire case or of the issues on which discovery is directed. The first prong of the two-factor test was therefore not satisfied.
The court further explained that even if it were to dismiss Mancinelli's claims, it was likely to grant leave to amend. Relying on National Union Fire Insurance Co. of Pittsburgh, PA v. Resource Development Services, Inc., No. 10-cv-01324-JF(PVT), 2010 WL 3746290, at *1 (N.D. Cal. Sept. 18, 2010), the court noted that a stay is inappropriate when it is unlikely that the claims would be dismissed without leave to amend and therefore the motion would not be entirely dispositive of the claims. Accordingly, Marriott's motion to stay discovery was denied.
Key Takeaways
- A party seeking to stay discovery pending a potentially dispositive motion must satisfy both prongs of the Northern District of California test: the motion must be potentially dispositive of the entire case or the discovery-directed issues, and it must be capable of decision without additional discovery.
- The Federal Rules of Civil Procedure do not authorize automatic or blanket stays of discovery merely because a potentially dispositive motion is pending.
- Courts take a preliminary peek at the merits of the pending dispositive motion to assess whether a stay is warranted.
- The likelihood that leave to amend would be granted weighs against finding that a pending motion is potentially dispositive for stay purposes, because the motion would not entirely dispose of the claims.
- The court denied the stay, allowing discovery to proceed.
Why It Matters
This order reinforces the Northern District of California's restrictive approach to staying discovery pending potentially dispositive motions. It confirms that the prospect of leave to amend weighs heavily against finding a motion potentially dispositive for stay purposes, because a dismissal without prejudice and with leave to amend would not finally resolve the litigation.
The decision also illustrates the practical operation of the preliminary peek standard. Rather than resolving the underlying motion, the court examined only whether the pending motion was likely to dispose of the entire case or the discovery-directed issues, and concluded that it was not. The order therefore ensures that discovery proceeds absent a strong showing that the pending motion will finally resolve the case without need for amendment.