Oculu, LLC v. Oculus VR, Inc.
Oculu, LLC v. Oculus VR, Inc.
2015 WL 12732897 (C.D. Cal. 2015)
March 3, 2015

Rosenbluth, Jean P.,  United States Magistrate Judge

Native Format
Sanctions
Cost Recovery
Metadata
Failure to Produce
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Summary
The Court found that Plaintiff had not opposed any of Defendant's motions regarding Electronically Stored Information, and that the motion did not concern spoliation of evidence. As a result, the Court limited sanctions to a token amount of $1500, to be paid by Plaintiff and its counsel.
Additional Decisions
Oculu, LLC
v.
Oculus VR, Inc
Case No. SACV 14-0196-DOC (JPRx)
Signed March 03, 2015

Counsel

Olivier A. Taillieu, National Injury Law Firm LLP, Beverly Hills, CA, Marc Stefan Williams, Dordi Williams Cohen LLP, Los Angeles, CA, for Oculu, LLC.
Bobby A. Ghajar, Marcus D. Peterson, Pillsbury Winthrop Shaw Pittman LLP, Los Angeles, CA, Michael G. Rhodes, Cooley LLP, San Francisco, CA, for Oculus VR, Inc.
Rosenbluth, Jean P., United States Magistrate Judge

Order Granting in Part Defendant's Motion for Sanctions

*1 On January 26, 2015, Defendant filed a followup request for sanctions based on Plaintiff's failure to comply with the Court's December 2, 2014 Order to produce financial documents as well as documents in native format. On February 2, 2015, Plaintiff filed opposition. Defendant filed a reply on February 5, 2015. Defendant seeks three categories of monetary sanctions: (1) half of its attorneys' fees for bringing the sanctions motion, or $13,033; (2) its fees in preparing the pending motion, or $3082.50; and (3) “a small portion” of the fees it expended in filing the original motion to compel, or $5606.90.
As an initial matter, Plaintiff is correct that Defendant is not entitled to the $5606.90 it seeks in connection with its original motion to compel, filed in November. The Court denied its request for sanctions related to that motion in its December 2 Order granting the motion in part, and Defendant did not seek reconsideration. It is not entitled to have the Court revisit the issue now. Accordingly, that part of Defendant's sanctions request is DENIED.
Federal Rule of Civil Procedure 37(d)(3) provides that instead of or in addition to the nonmonetary sanctions listed in subsection (b)(2)(A), “the court must require the party failing to act, the attorney advising that party, or both to pay the reasonable expenses, including attorney's fees, caused by the failure, unless the failure was substantially justified or other circumstances make an award of expenses unjust.” Indeed, “[e]xpenses should ordinarily be awarded” against the party who “carr[ies] his point to court” and loses. Fed. R. Civ. P. 37 advisory committee's note to 1970 amendment (subdivision (a)(4)).
As the Court already found at the January 15, 2015 hearing, Plaintiff clearly failed to timely produce the exact financial records requested by Defendant.[1] But as Plaintiff persuasively argues in its opposition to the sanctions request, its offered remedy for having failed to do so – producing to Defendant its entire Quickbooks file – was more than generous and gave Defendant access to information it neither requested nor was necessarily entitled to. Accordingly, minimal sanctions are warranted. Cf. Fay Ave. Props., LLC v. Travelers Prop. Cas. Co. of Am., No. 3:ll-cv-02389-GPC-WVG,2013 WL 3746107, at *9-10 (S.D. Cal. July 15, 2013) (declining to impose terminating sanctions in part because moving party not sufficiently prejudiced by other side's nine-month delay in supplementing responses to interrogatories).
As for the documents in native format, the Court still cannot discern whether Plaintiff has produced documents in the “most native” format it can. Plaintiff apparently maintains its files in “Basecamp,” “a project management application.” Plaintiff contends that “there simply is no way to call up the document with any of its original metadata once it is uploaded to Basecamp.” (Opp'n at 3.) This begs the question, of course, as to why Plaintiff can't produce versions of the files from before they were uploaded to Basecamp. Plaintiff implies, without actually saying, that it does not retain files other than on Basecamp.[2] But Defendant's argument that because of Plaintiff's Basecamp-filtered production it cannot tell when a document was created is beside the point: the parties agreed in their Rule 26 Joint Report that “the production of metadata beyond the following fields is not necessary in this lawsuit absent a showing of a compelling need: Date Sent, Time Sent, Date Received, Time Received, To, From, CC, BCC, and Email Subject.” (R. 26 J. Rep. at 7.) “Date Created,” which is not necessarily the same thing as “Date Sent,” is not among the fields listed. Defendant has not shown a “compelling need” for metadata relating to when any documents were created, which is the only missing field it has identified. As to the Kickstarter printout (see Mot. at 3), Defendant can determine when Plaintiff first learned about it by posing an interrogatory on the subject. Thus, no compelling need exists.
*2 Accordingly, although the Court previously ordered Plaintiff to produce documents in the most native format possible, it does not at this point have any basis for concluding that Plaintiff has not done so. Neither party has submitted an expert declaration explaining how Basecamp works or what its capabilities concerning metadata are. Although the Court might conjecture that Plaintiff should have versions of the files from before they were posted to Basecamp, nothing beyond speculation demonstrates that. Indeed, Plaintiff indicates that it does not “maintain” any files other than on Basecamp. (Opp'n at 3.) Moreover, Plaintiff has apparently complied with the parties' Rule 26 agreement; at least, Defendant has not shown that it has not. Thus, sanctions are not warranted based on Plaintiff's production of e-discovery. To the extent it has not already done so, however, Plaintiff must immediately produce to Defendant hard-copy printouts of any charts or other portions of the production identified in the original motion to compel as not being legible.
For the reasons stated above, the Court finds that only modest sanctions are appropriate, and only based on Plaintiff's failure to timely produce the requested financial records. Defendant prevailed as to only one of the two issues in its pending request for sanctions, and thus it deserves at most only half the requested amount, or $1541. Plaintiff offered at the January 15 hearing to make its Quickbook files available and apparently promptly did so. Thus, Defendant is entitled to reimbursement for at most half of the requested amount it expended in bringing the motion for sanctions, or $6516. The Court finds that the total of those two sums, $8057, overrepresents the prejudice to Defendant given Plaintiff's subsequent release of its Quickbook files. The short delay followed by Plaintiff's generous production of all of its financial records greatly mitigated any prejudice to Defendant, and therefore “other circumstances” would make a greater award unjust. Accordingly, sanctions limited to a token amount of $1500, to be paid by Plaintiff and its counsel, must be remitted to Defendant no later than seven days from the date of this Order. Given the annual sales produced by Plaintiff, such an amount is sufficient to curb any future “abuses occurring in the discovery process.” See Fed. R. Civ. P. 37 advisory committee's note to 1970 amendment.

Footnotes

Plaintiff has not opposed any of Defendant's motions on the ground that the requests for production were improper or otherwise objectionable. Rather, it has contended all along that it has complied with the requests to the extent it is able.
This motion does not concern spoliation of evidence, and the Court does not mean to imply that any such spoliation has taken place.