Catagory:Case Summaries

Clearone Communications, Inc. v. Chiang, 2008 WL 704228 (D. Utah Mar. 10, 2008)

In this case involving claims of misappropriation of trade secrets, breach of contract and conversion, plaintiff sought sanctions for two claimed wrongs:  (1) defendants’ belated production of, and misrepresentations about, source code complete with developer comments; and (2) defendants’ failure to produce “smoking gun” email, which was produced by another party who was the recipient of the email.

The so-called “smoking gun” email was written by defendant Lonny Bowers on September 5, 2005.  Bowers was one of the founders and principals of defendant WideBand.  The email was only discovered in documents produced by defendant Biamp, the recipient of the email, not in any discovery from the WideBand defendants.  The WideBand defendants explained that the computer system used by Bowers did not retain copies of email sent by Bowers.  On this point, the court observed:

For any business this is a significant irregularity; almost unimaginable for a technology company; and even more unlikely for a person of Bowers’ importance in such a company.  Nonetheless, it does not appear that the September 5, 2005, email was withheld by WideBand Defendants — they did not have any copies of emails sent by Bowers. 

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Equity Analytics, LLC v. Lundin, 248 F.R.D. 331 (D.D.C. 2008)

In this case, plaintiff Equity Analytics claimed that defendant, its former employee, gained illegal access to electronically stored information after he was fired.  Defendant explained that another Equity employee had granted him permission to use the employee’s username and password to access a particular Equity computer system.  Defendant admitted that he had accessed the system some 18 times over a 90-day period, and had used his Macintosh computer to do it.

In November 2007, the district court issued a TRO prohibiting defendant from “accessing or attempting to access Equity Analytics, LLC’s data on Salesforce.com for any purpose.”  The judge initially struck from the TRO a requirement that defendant permit Equity to have a computer forensic expert examine his computer to ascertain:  (1) whether defendant accessed Equity’s confidential customer data and/or trade secrets; (2) whether the data has been forwarded to defendant’s new employer an Equity competitor; and (3) whether the data was purged or overwritten.  The parties subsequently agreed that a computer forensic specialist should be permitted to examine defendant’s Macintosh computer, but they could not reach agreement on the search protocol.

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City of Seattle v. Prof’l Basketball Club, LLC, 2008 WL 539809 (W.D. Wash. Feb. 25, 2008)

The discovery dispute in this decision involved the City of Seattle’s request to have defendant Professional Basketball Club, LLC (“PBC”) search for and produce responsive emails for six of its eight members.  In January 2008, PBC produced approximately 150,000 emails from two members of PBC.  It objected to producing emails for the remaining six PBC members because such a search would “increase the universe exponentially” and would generally produce irrelevant documents.  The City moved to compel production of the requested emails.

The court first considered whether the requisite principal-agent relationship existed to establish that PBC had the legal right to obtain documents upon demand from its members.  The court analyzed PBC’s operating agreement under Oklahoma law, and concluded that the City had met its burden in establishing that PBC had “possession, custody, or control” over the at-issue documents for purposes of Fed. R. Civ. P. 34(a).

Next, the court found that the substance of the requested emails – information regarding the formation of PBC and the Sonics’ finances – may be relevant to the underlying issues.  Given the liberal discovery rules, the court declined to limit the City’s inquiry on relevancy grounds.  It stated that, whether such evidence warrants admissibility is a distinctly separate question that would be addressed at the appropriate time.

Finally, the court observed that the Federal Rules contemplate a specific requirement when a party objects to the production of electronically stored information, citing Fed. R. Civ. P. 26(b)(2)(B).  The court faulted PBC’s lack of specificity, stating that PBC had not explained why producing the emails at issue would be unnecessarily burdensome.  It continued:
 

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Petcou v. C.H. Robinson Worldwide, Inc., 2008 WL 542684 (N.D. Ga. Feb. 25, 2008)

In this employment discrimination case, the court had previously ordered defendant to produce computer-generated reports of attempts by its employees to access adult websites at two of its branches during the relevant time period.  Although the court had denied plaintiffs’ request for email messages with adult content, it gave plaintiffs the option to file a motion for reconsideration after they had been given an opportunity to obtain evidence regarding defendant’s burden of production.  This opinion addresses plaintiffs’ renewed motion, in which they requested that defendant produce “at a minimum, documents showing any emails of a sexual or gender derogatory nature sent from 1998 through 2006.”

Evidence relating to defendant’s burden was as follows:

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Finley v. Hartford Life and Acc. Ins. Co., 2008 WL 509084 (N.D. Cal. Feb. 22, 2008)

In this case, plaintiff claimed that defendant wrongfully terminated her disability benefits in violation of ERISA.  Plaintiff also alleged that Hartford violated her right to privacy by causing its agent Dempsey Investigators to trespass onto her land and videotape her and her roommate through the kitchen window of plaintiff’s home.

When Hartford served its Rule 26(a)(1) initial disclosures, it indicated it was disclosing a copy of the administrative record related to plaintiff’s disability claim, and produced among other things copies of the claim file, electronic notes and surveillance videos conducted by Dempsey.  Due to what Hartford calls an "administrative oversight," the videos produced did not contain the footage of plaintiff in her kitchen.  Hartford later produced the “kitchen video” in a supplemental disclosure under Rule 26(e).  Hartford argued that it complied with its usual procedure and that a reasonable search was done, and that as soon as it discovered that the full video had not been disclosed it complied with Rule 26(e) and supplemented its earlier disclosure.

Plaintiff sought sanctions, alleging that Hartford failed to disclose the kitchen video in violation of Rule 26(a); that Hartford’s attorney certified Hartford’s initial and incomplete disclosure in violation of Rule 26(g); and that Hartford failed to produce the kitchen video in response to a particular request for production.  Plaintiff sought sanctions in the amount of the costs and attorney’s fees she spent taking the depositions of Dempsey witnesses and retaining the services of an expert.  She argued that she took these depositions and engaged this expert solely because defendant did not produce the kitchen video in a timely manner, and that she would not have otherwise engaged the expert, or taken the depositions.
 

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Henry v. Quicken Loans, Inc., 2008 WL 474127 (E.D. Mich. Feb. 15, 2008)

This Fair Labor Standards Act overtime collective action was brought on behalf of approximately 422 plaintiffs who worked as "loan consultants" for defendants.  After defense counsel objected to plaintiffs’ requests to produce emails of the several hundred individual plaintiffs and their 32 team leader managers, plaintiffs agreed to limit the relevant time period to the months of April, May and June of 2004.  They proposed that, after they reviewed all the emails and narrowed them down to those they thought were relevant, they would give defendants an opportunity to review this reduced set of emails and raise any attorney client privilege or other objections they might have and retrieve items that should be protected.  Fearing that this "claw back" provision could be deemed a waiver of the privilege in some states, defense counsel was relunctant either to agree to the provision or to produce the relevant back up tapes because of the exceedingly expensive process of defense counsel screening them for privilege before production.

Plaintiffs filed a motion to compel to resolve the dispute and a hearing was held.  The court established a protocol that was intended to balance the concerns and needs of both sides at what was hoped to be manageable costs.  Under the protocol, plaintiffs’ computer forensic expert, Mark Lanterman, was to retrieve from defendants’ computer back up tapes all of the emails for the months of April, May and June of 2004.  Based on search terms and methods to be worked out by the attorneys for both sides, Mr. Lanterman, "at Plaintiffs’ reasonable expense for his services and the electronic copying expenses," was to filter this database for the team leaders and hundreds of plaintiffs.  Mr. Lanterman was to act under the "direction and control" of defense counsel in retrieving the requested emails from the backup tapes.  The searching and filtering of defendants’ database by Mr. Lanterman would be limited to the terms agreed upon by the parties.  Further, Mr. Lanterman was required to sign a declaration agreeing to the agency relationship with and under the direction and control of defense counsel, to be bound by the court’s orders and to maintain confidentiality.  At the hearing, while plaintiffs’ counsel agreed to pay the reasonable expenses of Mr. Lanterman, he expressed a desire to limit the costs to no more than what was needed and not to be giving defense counsel a "carte blanche" to run up the costs of the screening procedure at plaintiffs’ expense.

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D’Onofrio v. SFX Sports Group, Inc., 247 F.R.D. 43 (D.D.C. 2008)

In this contentious employment discrimination case, Magistrate Judge John M. Facciola resolved a number of discovery disputes relating to the production of electronically stored information.

Among other relief, plaintiff sought the production of a certain business plan in its original electronic format, with accompanying metadata.  Plaintiff argued that Fed. R. Civ. P. 34 permits the production of documents outside of their original format only "if necessary," and that in this case, there was no such necessity.  Defendants responded that:  (a) plaintiff did not request that the Business Plan or any other documents be produced in a specific format; (b) production in original electronic format with metadata is not required by the Federal Rules of Civil Procedure or in the absence of a clear agreement or court order, neither of which were present here; and (c) plaintiff had not demonstrated the relevance of the metadata.

The court rejected plaintiff’s interpretation of Rule 34:

Rule 34(a) does not set forth constraints on the manner of production, but instead establishes the permissible scope of a request.  Consequently, the "if necessary" clause seized upon by plaintiff is actually a constraint on the requesting party rather than the responding party.  In other words, electronic data is subject to discovery if it is stored in a directly obtainable medium.  If, however, it is not stored in a directly obtainable medium, a request may be made of the responding party to translate the electronic data into a "reasonably usable form."  Because the step of translating this type of electronic data adds an extra burden on the responding party, the request may only seek for it to be done "if [the translation is] necessary."  It is not the case that this clause requires the responding party to produce data in its original form unless "necessary" to do otherwise.
 

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Qualcomm Inc. v. Broadcom Corp., 2008 WL 66932 (S.D. Cal. Jan. 7, 2008)

On Monday, January 7, 2008, United States Magistrate Judge Barbara L. Major issued her Order on Broadcom’s Motion for Sanctions related to Qualcomm’s failure to produce tens of thousands of documents that Broadcom had requested in discovery.  (A copy of the January 7 order downloaded from Westlaw is available here.)  Additional background regarding the sanctions motion is available in our previous posts on the case on September 20, 2007, August 29, 2007 and August 13, 2007.

In this most recent order, the judge ordered Qualcomm to pay Broadcom $8,568,633.24 for its “monumental and intentional discovery violation,” representing all of Broadcom’s attorneys’ fees and costs incurred in the litigation.  (Because the trial judge had already awarded these costs and fees to Broadcom in its Exceptional Case Order, the court directed that Qualcomm receive credit toward this penalty for any money it paid to Broadcom to satisfy the exceptional case award.)

The court also found that six of Qualcomm’s outside attorneys “assisted Qualcomm in committing this incredible discovery violation by intentionally hiding or recklessly ignoring relevant documents, ignoring or rejecting numerous warning signs that Qualcomm’s document search was inadequate, and blindly accepting Qualcomm’s unsupported assurances that its document search was adequate.”  The court observed that these six attorneys “then used the lack of evidence to repeatedly and forcefully make false statements and arguments to the court and jury.”  As such, the court found that the attorneys had violated their discovery obligations and also may have violated their ethical duties.  Accordingly, the court concluded that sanctions against the six named outside attorneys were also warranted.

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