              IN THE COURT OF APPEALS OF NORTH CAROLINA

                                   No. COA17-984

                                Filed: 20 March 2018

Durham County, No. 17 CVS 1647

ENGILITY CORPORATION, Plaintiff,

             v.

PAUL NELL, et al., Defendants.


      Appeal by defendants from orders entered 20 February 2017 and 3 April 2017

by Judge Orlando F. Hudson, Jr. in Durham County Superior Court. Heard in the

Court of Appeals 20 February 2018.


      Whiteford, Taylor & Preston LLP, by C. Allen Foster and Eric C. Rowe, for
      plaintiff-appellee.

      Vann Attorneys, PLLC, by Joseph A. Davies, and Marino Finley LLP, by Daniel
      Marino, Tillman J. Finley and Kathrynn Benson, pro hac vice, for defendant-
      appellants.


      TYSON, Judge.


      Paul Nell, Torch Hill Investment Partners, LLC, The Allies Corporation, and

Andrew Blair (“Defendants”) appeal from an order granting Engility Corporation’s

(“Plaintiff”) motion to quash and for protective order. Defendants also appeal from

an order denying their Rule 60 motion for relief. We dismiss the appeal pertaining

to the order granting Plaintiff’s motion to quash as untimely and interlocutory. The

trial court’s order denying Defendants’ motion for relief is affirmed.
                                ENGILITY CORP. V. NELL

                                    Opinion of the Court



                                     I. Background

                                      A. Subpoena

        Plaintiff filed suit against Defendants in Fairfax County, Virginia (the

“Virginia Case”). Some of the allegations arose from the Plaintiff’s attempted sale of

International Resource Group (“IRG”), a subsidiary of its international business. In

early January 2017, Research Triangle Institute, Inc. (“RTI”) purchased IRG.

        On 11 January 2017, Defendants requested the Durham County superior court

to issue a subpoena to RTI pursuant to the Uniform Depositions and Discovery Act.

N.C. Gen. Stat. § 1F-3 (2017). This request was based upon a previously issued

Virginia subpoena and sought to obtain documents related to the pending Virginia

Case.

        Plaintiff objected to the request for third-party discovery and filed a motion to

quash the Virginia subpoena to RTI in Fairfax County, on 9 February 2017. Plaintiff

and RTI requested Defendants allow them to postpone the production of documents

until after the motion concerning the Virginia subpoena was resolved. Defendants

refused.

        On 14 February 2017, RTI sent Defendants a letter of objection to the

subpoena, and again requested to delay production, pending the outcome of the

hearing in Virginia.     That same day, Plaintiff filed a motion to quash and for

protective order in Durham County, arguing



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             the information requested from RTI [was] repetitive of
             discovery requests already made to Plaintiff, is in the
             process of being provided by Plaintiff to Defendants, serves
             no purpose other than to unduly burden RTI and is the
             subject of a pending motion to quash in the Circuit Court
             of Fairfax County, VA, the venue of the related action.

      This motion was served upon Defendants by first class and electronic mail on

14 February 2017. Defendants deny ever receiving the motion via first class mail.

No hearing was held on Plaintiff’s motion. The superior court granted Plaintiff’s

motion to quash the subpoena and allowed monetary sanctions on Defendants in an

order dated 20 February 2017 (the “February order”). In an order dated 3 March

2017, the Fairfax County circuit court denied Plaintiff’s motion to quash the Virginia

subpoena to RTI. The Virginia circuit judge ruled the court lacked jurisdiction over

subpoenas issued to out-of-state entities.

      After receiving a copy of the February order from Plaintiff via email,

Defendants filed a Rule 60 motion for relief on 9 March 2017. After a hearing, the

superior court denied Defendants’ motion for relief on 3 April 2017 (the “April order”).

      Defendants filed notice of appeal of both the February order and the April order

on 20 April 2017.

                                    B. Post-Appeal

      Defendants served Plaintiff with their proposed record on appeal on 29 June

2017. Plaintiff responded with its objections and proposed amendments on 28 July

2017. After much discussion between the parties, Defendants filed the record on


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appeal on 13 September 2017. Neither party sought judicial settlement to settle the

record.

        On 17 September 2017, Defendants filed a motion for retroactive extension of

time to file the record on appeal or for alternative relief under Rule 25. Plaintiff

opposed Defendants’ motion, and submitted a motion to dismiss the appeal on 27

September 2017. Defendants’ motion to extend the time to file was allowed by this

Court, and Plaintiff’s motion was referred to this panel on 27 October 2017.

        Defendants filed a petition for writ of certiorari on 10 October 2017, which was

also referred to this panel on 27 October 2017. On 13 October 2017, an order of

nonsuit was entered in the Virginia Case, and the underlying case between Plaintiff

and Defendants was dismissed.        Plaintiff included this order in its response to

Defendants’ petition for writ of certiorari on 24 October 2017. Defendants requested

this Court to take judicial notice of the order from the Virginia Case on 2 February

2018.

                                       II. Issues

        Defendants argue the superior court abused its discretion by granting

Plaintiff’s motion to quash and for protective order three days after it was filed,

without waiting for Defendants’ response, and without providing a hearing, notice of

a hearing, or notice that the motion would be reviewed without a hearing. Defendants

assert the trial court also erred by granting the motion and argue Plaintiff



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purportedly did not have standing to file the motion and it was untimely. Finally,

Defendants argue the superior court abused its discretion in denying their Rule 60

motion for relief.

                                  III. February Order

                               A. Appellate Jurisdiction

      The first matter before us is the 20 February order granting Plaintiff’s motion

to quash and for protective order. Plaintiff argues Defendants failed to give timely

notice of appeal and the appeal must be dismissed. Defendants delayed filing this

notice of appeal until 20 April 2017. Defendants filed a petition for writ of certiorari

on 10 October 2017.

      We allow Defendants’ petition and issue the writ pursuant to Rule 21 of the

North Carolina Rules of Appellate Procedure. N.C. R. App. P. 21(a)(1) (“The writ of

certiorari may be issued in appropriate circumstances by either appellate court to

permit review of the judgments and orders of trial tribunals when the right to

prosecute an appeal has been lost by failure to take timely action . . . .”).

                              B. Timeliness of the Appeal

      “As a general rule, discovery orders are interlocutory and therefore not

immediately appealable.” Mims v. Wright, 157 N.C. App. 339, 341, 578 S.E.2d 606,

608 (2003) (citations omitted). “The prohibition against appeals from interlocutory

orders prevents fragmentary, premature and unnecessary appeals by permitting the



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                                   Opinion of the Court



trial court to bring the case to final judgment before it is presented to the appellate

courts.” Feltman v. City of Wilson, 238 N.C. App. 246, 250, 767 S.E.2d 615, 618-19

(2014) (citation and quotation marks omitted).            An interlocutory order may be

immediately appealable if it affects a substantial right. Hudson-Cole Dev. Corp. v.

Beemer, Inc., 132 N.C. App. 341, 344, 511 S.E.2d 309, 311 (1999) (citation omitted).

             It is well settled that a judgment which determines liability
             but which leaves unresolved the amount of damages is
             interlocutory and cannot affect a substantial right: [i]f . . .
             [such a] partial . . . judgment is in error defendant can
             preserve its right to complain of the error on appeal from
             the final judgment by a duly entered exception. Even if
             defendant is correct on its legal position, the most it will
             suffer from being denied an immediate appeal is a trial on
             the issue of damages.

Steadman v. Steadman, 148 N.C. App. 713, 714, 559 S.E.2d 291, 292 (2002) (quoting

Johnston v. Royal Indemnity Co., 107 N.C. App. 624, 625, 421 S.E.2d 170, 171 (1992)).

      Here, the February order allows Plaintiff’s motion to quash, grants a protective

order, and orders Defendants to bear the costs related to the discovery sought and

pay reasonable attorney’s fees.      The superior court did not certify its order as

immediately appealable under Rule 54(b). N.C. Gen. Stat. § 1A-1, Rule 54(b) (2017).

      The amount of any costs and fees that may be imposed remains undetermined

at this time. “[I]f we were to allow this appeal, we would be required to visit the [costs

and] fees issue twice: one appeal addressing, in the abstract, whether plaintiff may

recover [costs and] fees at all and, if we upheld the first order, a second appeal



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                                   Opinion of the Court



addressing the appropriateness of the actual monetary award.” Triad Women’s Ctr.,

P.A. v. Rogers, 207 N.C. App. 353, 358, 699 S.E.2d 657, 660 (2010).

      In order to avoid a “fragmentary, premature and unnecessary” appeal, we

dismiss the purported appeal of the February order as interlocutory until the amount

of costs and fees, if any, is imposed. Feltman, 238 N.C. App. at 250, 767 S.E.2d at 618.

                                    IV. April Order

                              A. Appellate Jurisdiction

      The order denying Defendants’ Rule 60 motion for relief was entered 3 April

2017. Defendants timely appealed on 20 April 2017. The April order was a final

judgment of a superior court from which an appeal of right may be taken to this Court.

N.C. Gen. Stat. § 7A-27(b)(1) (2017).

                                B. Standard of Review

      “A trial court’s discovery ruling is reviewed for abuse of discretion, and will be

overturned only upon a showing that its ruling was manifestly unsupported by reason

and could not have been the result of a reasoned decision[.]” Friday Investments v.

Bally Total Fitness, __ N.C. __, __, 805 S.E.2d 664, 669 (2017) (internal citations and

quotation marks omitted).

                                C. Abuse of Discretion

      Defendants filed a motion seeking relief from the February order quashing the

subpoena pursuant to Rule 60(b)(1) and (b)(6). See Sink v. Easter, 288 N.C. 183, 196,



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217 S.E.2d 532, 540 (1975) (holding Rule 60(b) motions only apply to final, not

interlocutory, judgments or orders). Defendants argue the February order should be

vacated under (b)(1) as it “was entered by mistake and in contravention of the

procedures established by the Court, resulting in surprise to Defendants” and the

“lack of hearing, notice of a hearing, or any opportunity to respond and the entry of

the Order in expedited fashion” also justify relief under (b)(6). Defendants argue, and

Plaintiff admits, the February order was irregular, due to the lack of prior notice or

hearing provided to the parties.

      “A judgment rendered in violation of the rules respecting procedural notice is

irregular.” Collins v. Highway Commission, 237 N.C. 277, 284, 74 S.E.2d 709, 715

(1953). “An irregular judgment is not void,” and “stands as the judgment of the court

unless and until it is set aside by a proper proceeding.” Id. (citations omitted). “A

party seeking to set aside an irregular judgment may properly do so by filing a motion

for relief from judgment pursuant to Rule 60(b)(6).” Brown v. Cavit Sci., Inc., 230 N.C.

App. 460, 464, 749 S.E.2d 904, 908 (2013) (citations omitted).

       “In order for a defendant to succeed in setting aside a . . . judgment under Rule

60(b)(6), he must show: (1) extraordinary circumstances exist, (2) justice demands the

setting aside of the judgment, and (3) the defendant has a meritorious defense.” Gibby

v. Lindsey, 149 N.C. App. 470, 474, 560 S.E.2d 589, 592 (2002) (citations omitted).

Defendants argue their lack of ability to respond to the February order, the entry of



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the order in “an expedited fashion” without notice or hearing, and the entry of the

order inhibiting their ability to pursue discovery and imposing sanctions against

them were enough to constitute “extraordinary circumstances.” See id. Defendants

raise no arguments concerning the other two prongs required to set aside a judgment

under Rule 60(b)(6).

      Between the denial of Defendants’ motion for relief and this appeal, the

discovery Defendants sought was provided and the Virginia Case has been dismissed.

The issue of the sanctions, as discussed above, is not timely nor properly before this

Court. Without a showing of a “meritorious defense,” the February order remains

undisturbed. See Sellers v. Rodriguez, 149 N.C. App. 619, 625, 561 S.E.2d 336, 340

(2002). Defendants have failed to show any abuse of discretion in the trial court’s

denial of their 60(b) motion. Defendants’ arguments are overruled.

                                   V. Conclusion

       We allow Defendants’ petition and issue the writ of certiorari to consider

Defendants’ challenges to the February order, pursuant to Rule 21 of the North

Carolina Rules of Appellate Procedure. N.C. R. App. P. 21(a)(1). Without a final order

assessing the costs and fees, if any, to be awarded to Plaintiff, the appeal of the

February order is interlocutory, untimely, and is dismissed. Feltman, 238 N.C. App.

at 250, 767 S.E.2d at 618.




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      Defendants failed to show a meritorious defense or any abuse of the trial

court’s discretion to support setting aside the February order. See Sellers, 149 N.C.

App. at 625, 561 S.E.2d at 340. We dismiss the appeal of the February order and

remand. The April order is affirmed. It is so ordered.

      DISMISSED IN PART, AFFIRMED IN PART, AND REMANDED.

      Chief Judge McGEE and Judge DILLON concur.




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