TETRA TECH, INC., a Delaware corporation, Plaintiff, v. JERRY HERLING CONSTRUCTION, INC., a California corporation, and JERRY HERLING, in individual, Defendants Civil No. 08–CV–210–D United States District Court, D. Wyoming Filed April 25, 2011 Skavdahl, Scott W., United States Magistrate Judge ORDER GRANTING PLAINTIFF'S MOTION TO COMPEL PRODUCTION OF FINANCIAL DATA *1 The above-entitled matter has come before the Court on Plaintiff's Motion to Compel Production of Financial Data. Doc. 51. The Court, having carefully considered the motion and response, and being fully advised in the premises, FINDS: I. BACKGROUND Plaintiff provides construction services. Plaintiff alleges Defendants engaged in fraud and breached contractual obligations for work Defendants had contracted to perform at various wind farm sites in Wyoming. Plaintiff explains that in 2008 it entered into contracts with PacifiCorp to provide construction and construction management services for three wind farm energy development projects: (1) the Rolling Hills Wind Farm, near Glenrock, Wyoming; (2) the seven Mile Wind Farm in Carbon County, Wyoming; and (3) the Glenrock Wind Farm Project, also near Glenrock, Wyoming. Plaintiff then entered into three subcontract agreements with Defendant Jerry Herling Construction (JHC) for the civil earthwork services on the wind farm projects. The subcontracts established specifications, quality control requirements, and schedules for JHC's earthwork. Plaintiff alleges JHC was behind schedule on the projects, to the extent it delayed Plaintiff and other subcontractors working on the projects. Plaintiff explains that in August 2008, JHC asked Plaintiff to directly pay JHC's vendors and subcontractors because JHC was unable to make payments. According to Plaintiff, it told JHC it “may pay some of JHC's vendors and subcontractors,” but that JHC falsely represented to its vendors and subcontractors that Plaintiff had promised to pay them. Plaintiff asserts that after it paid hundreds of thousands of dollars to JHC's vendors and subcontractors, as well as making JHC's payroll, it learned JHC owed substantially more that it had originally represented to Plaintiff and that Defendant Jerry Herling concealed the actual amounts owed. On September 13, 2008, JHC removed its equipments from the three wind farm sites, despite not having completed the work. On September 16, 2008, Plaintiff terminated the subcontract agreements by written notice of termination and then retained other subcontractors to complete the work. Plaintiff asserts JHC failed to pay its vendors and subcontractors, who have since asserted claims or liens against Plaintiff. Plaintiff states it has paid some of these, and in doing so, has suffered substantial damages. Defendants filed a Counterclaim, asserting JHC was induced to enter into the subcontracts with Plaintiff based on fraudulent misrepresentations. JHC claims that it submitted its bid to Plaintiff based on the belief that it would be required to move no more than 88,000 cubic yards of material, but that the actual amount of material removed exceeded the 88,000 cubic yards. JHC asserts Plaintiff then required it to perform additional work not contemplated by the subcontract agreements without additional compensation. JHC believes plaintiff conspired to take over JHC's business and assets, by placing JHC in extreme financial distress. II. DISCUSSION *2 Plaintiff now files this motion to compel seeking electronic files, bank account statements, and cancelled checks from Defendants' accounting records. Plaintiff explains that it has served three sets of written discovery on Defendants, but that they refuse to produce the information. Plaintiff claims this information is necessary to verify the accuracy of reports already produced by Defendants and to prove its claims and defend against Defendants' counterclaims. Defendants object to the requested discovery as being intrusive, excessive, and burdensome. 1. Law The rules governing discovery are to be accorded broad and liberal construction. See Herbert v. Lando, 441 U.S. 153, 177 (1979). Pursuant to Rule 26 of the Federal Rules of Civil Procedure, the parties are entitled to “obtain discovery regarding any nonprivilege matter that is relevant to any party's claim or defense ... For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence.” Fed.R.Civ.P. 26(b)(1). Relevancy is broadly construed, meaning if there is any possibility that the discovery sought may be relevant to a party's claim or defense, such request should be considered relevant. Centurion Indus., Inc. v. Warren Steurer & Assoc., 665 F.2d 323, 326 (10th Cir. 1981). “When the discovery sought appears relevant, the party resisting the discovery has the burden to establish the lack of relevancy by demonstrating that the requested discovery (1) does not come within the scope of relevance as defined under Fed.R.Civ.P. 26(b)(1), or (2) is of such marginal relevance that the potential harm occasioned by discovery would outweigh the ordinary presumption in favor of broad disclosure.” Simpson v. University of Colorado, 220 F.R.D. 354, 350 (D. Colo. 2004)(citations omitted). The Court recognizes the right to conduct discovery is not absolute. The Court may limit discovery if it determines: (i) the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive; (ii) the party seeking discovery has had ample opportunity to obtain the information by discovery in the action; or (iii) the burden or expense of the proposed discovery outweighs its likely benefit. Fed.R.Civ.P. 26(b)(2)(C). 2. Analysis Plaintiff seeks all of Defendants' QuickBooks data in native format, bank account statements, and cancelled checks for the period of January 1, 2008 to December 31, 2008. Defendants kept track of JHC's income and expenses by categorizing and entering that financial data into QuickBooks. Plaintiff asserts that it needs this data to prove certain claims, specifically its claims for fraud, conversion, beach of trust obligations, and constructive fraud, which are dependent on a detailed analysis of Defendants' financial records. Plaintiff also argues the QuickBooks data may evidence improper use of contract funds. Based on the claims and defenses in this case, the Court finds this information to be relevant and reasonably calculated to lead to the discovery of admissible evidence. Defendants, however, do not argue the information is irrelevant. Rather, Defendants claim it would be unnecessarily intrusive, excessive, and burdensome for JHC “to turn itself inside out based upon [Plaintiff's] flimsy allegations [because] the money that was co-mingled into JCH's checking account cannot be traced by radioactive markers.” Doc. 53 at 5. Defendants argue they were not obligated to pay the suppliers and vendors who worked on the wind farm projects with monies received from Plaintiff. Defendants explain that the wind farm projects were not the only projects JHC was working on and the money it received went into a single checking account and bills were then paid out of that account. Therefore, Defendants suggest the Job Costs by Job and Vendor Detail form is sufficient because it shows what funds JHC received and what it paid out. See Doc. 53–4. *3 The Court rejects Defendants' arguments. “In opposing discovery on the grounds of burdensomeness, a party has the burden to show facts justifying their objection by demonstrating that the time or expense involved in responding to requested discovery is unduly burdensome.” Cory v. Aztec Steel Bldg., Inc., 225 F.R.D. 667, 672 (D. Kan. 2005). Defendants have not met their burden. The discovery sought is not excessive or burdensome. Nor does the expense or burden outweigh the benefit. Moreover, the information sought by Plaintiff is not overly intrusive given the nature of the claims and counterclaims in this action. Finally, regardless of the validity of the underlying claims, these claims exist and for this reason the information sought is relevant, thus discoverable. II. CONCLUSION The Court finds Plaintiff is entitled to obtain discovery on any nonprivileged matter that is relevant to its claims and defenses. The information Plaintiff has requested in its motion to compel is relevant to this action. The Court does not agree that the information is excessive or burdensome as Defendants suggest. Therefore, Defendants shall produce their QuickBooks data in native format, bank account statements, and cancelled checks for the period of January 1, 2008 to December 31, 2008 on or before May 3, 2011. NOW, THEREFORE, IT IS ORDERED that Plaintiff's Motion to Compel Production of Financial Data be, and the same is hereby, GRANTED as set forth herein. Dated this 25th day of April, 2011.