I. Background.

*1 In June 2019, Petitioner Lufthansa Technik AG (“Lufthansa”) applied for an order under 28 U.S.C. § 1782 to take discovery from Respondent Thales Avionics, Inc. (“Thales”), a Delaware corporation with an office in Irvine, to use in foreign proceedings. (Dkt. 1 at 6.) The discovery was sought for use in actions then-pending in Germany, the United Kingdom (“UK”), and France and “contemplated” actions in Spain and Japan. (Id. at 1.)

Lufthansa initiated the German action in December 2010 against Astronics Advanced Electronic Systems (“AES”) alleging infringement of Lufthansa's European “EP 145 Patent.” (Id. at 2.) The patent claims technology that “enabled a standard household voltage supply to be provided in the cabin of an aircraft to supply electricity to allow passengers to use their laptops or electronic entertainment devices in flight.” (Id. at 5.) AES sells 110V in-seat power systems to Thales for incorporation into Thales's in-flight entertainment (“IFE”) units. Thales then sells the IFE units to airlines worldwide. (Id. at 6.)

Thales is not a participant in the German or UK actions. (Id. at 10.) While Thales is a party to proceedings in France, Lufthansa argued that it needed § 1782 discovery against Thales in the United States to obtain documents located here. (Id. at 12; Dkt. 38 at 20.)

In July 2019, the Court granted Lufthansa's application and permitted Lufthansa to serve Thales with a document subpoena (Dkt. 14) but without prejudice to Thales objecting to or moving to quash or modify the subpoena. (Dkt. 11.)

After service, Thales moved for reconsideration (Dkt 15) and AES moved to intervene (Dkt. 18). On August 14, 2019, the Court held a hearing on those motions. (Dkt. 38 [transcript].) The Court granted the motion to intervene (Dkt. 34) and directed the parties to file a status report after meeting and conferring to reach a compromise over the disputed scope of the subpoena's document requests (Dkt. 38 at 32-33).

The Court instructed that the compromise should involve the “least burdensome” way to produce relevant information in view of deadlines in the foreign litigation. (Id. at 42.) Lufthansa suggested that Thales might be able to create a spreadsheet with responsive information based on exporting data from Thales's accounting system and then produce a 30(b)(6) witness to explain the spreadsheet. (Id. at 37, 42.) Counsel for Lufthansa stated, “We agree, if there's some of them they [Thales] don't have, we're not going to insist on it ... If they say, look, we can give you ten of these, but not the other eight, we take the ten, right.” (Id. at 37-38.) Both Thales and the Court understood Lufthansa to be agreeing to pursue discovery “much more narrow” than that sought by the subpoena. (Id. at 42-43.) Thales represented that it would be easier to respond by country based on their record-keeping system, focusing on Germany first. (Id. at 45-46.) The Court directed the parties to file status reports stating what Thales had produced, what Thales had agreed to produce and when, and what remained in dispute. (Id. at 60.)

*2 After reviewing the status reports (Dkt. 40, 41), the Court held another hearing on August 29, 2019. (Dkt. 46 [transcript].) Additional hearings and/or status conferences were held on September 5, 2019 (Dkt. 48, 52 [transcript] ), September 10, 2019 (Dkt. 51), September 27, 2019 (Dkt. 67, 71 [transcript] ), October 24, 2019 (Dkt. 73), November 4, 2019 (Dkt. 74), November 20, 2019 (Dkt. 75), December 3, 2019 (Dkt. 76), December 16, 2019 (Dkt. 77), and July 29, 2020 (Dkt. 88, 91 [transcript] ). Lufthansa filed the instant motion to compel on August 22, 2020 (Dkt. 97, 100 [joint stipulation] ), and the Court conducted a lengthy telephonic hearing on September 1, 2020 (Dkt. 101, 104 [transcript].)

II. Geographic Scope.

Thales argues that it should not be compelled to produce any records related to Spain and Japan, because Lufthansa has not initiated any litigation in those jurisdictions despite publicly stating that it has been “contemplating” litigation there for more than eight years. (Dkt. 100 at 7 [citing records from a 2011 § 1782 case Lufthansa filed in the Western District of Washington].)

Back in September 2019, counsel for Lufthansa advised the Court that the parties had tentatively reached an agreement on Spain and Japan whereby Thales would “estimate ... the total ... dollar figure of sales in those two countries” so that Lufthansa could “assess whether honestly it makes sense to bring claims there.” (Dkt. 46 at 18.) Counsel added, “at that point it may be the end of it for Spain and Japan.” (Id.) Counsel for Thales was “agreeable to at least looking into that and providing that information ... if it's not too difficult.” (Id. at 18-19.)

In the current motion, however, Lufthansa abandons this tentative agreement and moves to compel production of all of the documents/information responsive to Requests 2 and 3 in the subpoena for Spain and Japan, without foreclosing the possibility of requesting more documents later. (Dkt. 100 at 43.)

Considering the burden to Thales, Lufthansa's refusal to commit to a narrowed scope of discovery during the lengthy “meet and confer” process, the fact that no litigation is presently pending in Japan or Spain, and that Lufthansa has contemplated such litigation since at least 2011 without filing it (diminishing the likelihood that it will ever pursue such litigation), the Court finds that Lufthansa's discovery demands concerning Spain and Japan are unduly burdensome and disproportionate to the needs of the case. The Court QUASHES those portions of the subpoena and related deposition notices seeking discovery from Thales about Japan or Spain.

III. Requests for Production.

A. Requests 2 and 3: Purchase and Sales Data

These requests seek documents showing for Germany, the UK, and France (2) all purchases by Thales of AES 110V in-seat power systems for installation in aircrafts and (3) all sales by Thales of units containing an AES 110V in-seat power systems, along with approximately 18 additional pieces of information for each purchase and sale. (Dkt. 100 at 13-14 and 24-25 [charts listing subparts not included in spreadsheets produced by Thales].)

Thales explains that it responded to Requests 2 and 3 by producing spreadsheets identifying relevant purchases and sales. It created the spreadsheets as part of what it understood to be a compromise agreement. (Dkt. 100 at 16.) The “initial spreadsheets included every payment to AES without filtering for specific parts that Lufthansa may allege are infringing.” (Dkt. 100 at 15.) When Lufthansa later provided a list of AES part numbers alleged to be infringing, Thales created an updated spreadsheet with more detailed information about the sale/purchase of those part numbers. (Id. at 17.) Thales also provided deposition testimony to explain how the spreadsheets were created.

*3 In its argument, Lufthansa points out that data is missing without ever discussing the history of the parties' negotiations, the Court's directive to “meet and confer” to narrow the discovery, and the fact that Thales created spreadsheets in reliance on Lufthansa's stated position that it would not insist on full compliance with the subpoena. (Dkt. 100 at 12, 19.)

The Court generally DENIES Lufthansa's motion to compel a further response to Requests 2 and 3. Thales was not obligated by the discovery rules to create spreadsheets, but it undertook to do so and did so under tight time constraints, taking Lufthansa at its word. Lufthansa cannot induce such extensive discovery efforts and then retract its agreement.

The Court, however, will GRANT the motion to the extent of requiring Thales to produce another spreadsheet comparable to the existing UK spreadsheet that includes sales and purchase data for Northern Ireland. As counsel for Thales explained at the hearing, data for Northern Ireland was not purposefully omitted, but retrieving it required a different database query that Thales inadvertently never made. (Dkt. 104 at 22).

B. Request 4 and 5: Documents from Sales and Purchases

These requests seek purchase orders, specifications, statements of work, and other documents showing the number of Units (a defined term including AES infringing parts and peripherals, not identified by part number) (4) purchased by and (5) sold by Thales for installation in aircrafts in France, Germany, and the UK from 2003 through the present.

Rather than a spreadsheet summarizing purchase and sale data, Lufthansa requests production of underlying documents. Lufthansa suggests that Thales produce “12 representative sample sets (four sets each for Germany, the UK, and France) of purchase orders (including all documents associated with the purchase order; i.e., invoice, packing slip, certificates, other shipment information, technical specifications) for each year since 2007 for Germany, 2011 for the UK, and 2012 for France,” which Lufthansa will then evaluate to determine whether to seek additional documents. (Dkt. 100 at 29-30.)

Thales again asserts that “the parties expressly determined to undertake the production of the spreadsheets in lieu of Requests 4 and 5. Those spreadsheets total thousands of lines of data compiled and delivered to Lufthansa in a good-faith effort to provide Lufthansa the universe of information they sought.” (Id. at 30-31.)

The Court DENIES Lufthansa's motion to compel for the same reasons stated for Requests 2 and 3.

C. Request 6: Contracts

This request seeks “all contracts between Thales and third parties involving the purchase, offering, return or repair of 110V in-seat power systems for installation on Airbus, Boeing, Bombardier, or Embraer aircraft in the United Kingdom, France, ...[or] Germany ... or in the aircraft of any other aircraft manufacturer in those countries.” (Id. at 31.)

Thales provided its contracts with AES. (Id. at 32.) As a compromise, Lufthansa suggests that “Thales produce all such contracts with its largest customers (and their affiliates) in the relevant countries: Air Lease; Airbus; BMI, British Midland; Boeing; British Airways; GE Comm. Aviation; Japan Airlines; Korean Airlines; Libyan Airlines; Oman Air; Qatar Airways; Saudi Arabian Airline; Srilankan Airlines; and Turkish Airlines,” to be followed by additional requests if Lufthansa deemed them warranted. (Id. at 31-32.)

*4 Thales argues that all contracts between Thales and its customers are not relevant, because Thales “has multiple suppliers, so Lufthansa's allegation that any IFE units supplied to Airbus or Boeing are relevant fails to understand that such transactions could have no relation whatsoever to AES or the infringement allegations Lufthansa has brought.” (Id. at 33.) Thales argues that responding would be unduly burdensome, because that would require Thales “to review every contract with every vendor and customer, and then manually cross-check that against the responsive program numbers, part numbers, invoices, or other identifying information.” (Id.) Thales refused the compromise proposed by Lufthansa because it is still “extremely broad and vaguely crafted,” citing the reference to undefined “affiliates” and Lufthansa's refusal to enter into a binding compromise. (Id.)

The Court agrees that Request 6 as drafted encompasses irrelevant information, and responding to it would impose an undue burden disproportionate to the needs of the case. While Lufthansa had an opportunity to narrow its scope during the lengthy “meet and confer” process, Lufthansa declined to propose any binding compromise. The Court DENIES Lufthansa's motion to compel a further response to Request 6.

D. Requests 7 and 8: Statements of Work and Specifications

These requests seeks (7) all statements of work between Thales and third parties involving the purchase, storage, shipment, offering, return or repair of 110V in-seat power systems for installation in aircrafts in the UK, Germany or France; and (8) all specifications that aircraft manufacturers provided to Thales for 110V in-seat power systems to be installed in aircraft in Germany, the UK, and France. (Id. at 34, 36.)

As a compromise for Request 7, Lufthansa proposed that Thales produce “a statement of work from 2007 to 2018 for each of AES and the top customers [identified re Request 6] with respect to ... any outlet unit (ACOU, Power Outlet, PRO, OU), in seat-power supply (or PSPS, including Seat Modules (SPM) and Seat Power Boxes (SPB)), or Master Control Unit (MCU/AMCU/EMCU) for 110V in-seat powers systems.” (Id. at 35.)

As a compromise for Request 8, Lufthansa proposed that Thales produce “at least 20 sample specifications provided by Airbus and Boeing related to outlet units and in-seat power supplies (10 samples for each); 20 sample aircraft manuals (relating to at least five different aircraft types (A380, A350, A320, A321, A319)); and the respective reapproval documentation for those parts and aircrafts” for Lufthansa's review to determine if additional document production is warranted. (Id. at 37.)

Thales again objects that locating responsive documents would require it to “review every contract with every vendor and customer, and then manually cross-check that against the responsive program numbers, part numbers, invoices, or other identifying information.” (Id. at 36.) Further, the requested documents “contain particularly sensitive competitive and technical information, have little relevance to Lufthansa's discovery needs, and are redundant of other materials already produced. Thales Avionics has already provided detailed information of its shipments of AES parts or of assemblies that include AES parts to the relevant jurisdictions.” (Id.)

Thales objections are well-taken. While Lufthansa cites an example of how one statement of work contained information revealing AES's knowledge of the location of the end customer, the likelihood of such information appearing in a significant number of other statements of work or technical specifications is not great enough to justify the burden of a third-party locating and producing them, particularly when Lufthansa has refused to reduce the burden by committing to any binding compromise. For these reasons, the Court DENIES Lufthansa's motion to compel a further response to Request 7.

E. Requests 9 and 12 (duplicative): Part Numbers

*5 This request seeks “all part numbers of 110V in-seat power systems purchased, stored, shipped, offered, returned or repaired by Thales from Astronics” for installation in aircraft in Germany, France, or the UK. (Id. at 38.)

Lufthansa asserts that Thales produced “a few contracts with AES and some forecasting document,” but believes that more responsive documents exist. (Id.)

Thales objected that the request was vague for failing to specify if Lufthansa is seeking AES part numbers, Thales part numbers, or part numbers assigned by aircraft manufacturers. (Id. at 39.) Nevertheless, Thales asserts that it “complied in full by producing a report from its database that identified any AES part number in the database with its corresponding Thales Avionics cross-reference.” (Id.)

At the hearing, when asked why the spreadsheet was not a sufficient response, counsel for Lufthansa suggested that Thales provide a declaration representing that the list of part numbers was complete. (Dkt. 104 at 53.) Counsel for Thales represented that Thales had already disclosed its methodology for creating the spreadsheet, and the spreadsheet contained all the part numbers from the database generated in response. (Id. at 54.) This sufficiently responds to Requests 9 and 12, and the Court DENIES Lufthansa's motion to compel a further response.

F. Requests 10 and 11: AES's Knowledge

These requests generally seek documents showing AES's knowledge that “units” it sold or sold to Thales would end up in Germany, France, or the UK. (Id. at 39-40.)

During the “meet and confer” process, the parties discussed running key word searches against email communications between AES and Thales employees who might have communicated with AES about this subject. Lufthansa proposed searches in February 2020. See Dkt 100-19 [Morris Decl., ¶ 25, Ex. 14].) Thales describes the proposed searches as “something akin to 5,458 searches” with complicated logic and fill-in-the-blank terms that were “demonstrably unworkable.” (Dkt. 100 at 42.) Thales advised Lufthansa in March 2020 that it could not run the proposed searches, and Lufthansa faults Thales for not proposing an alternative search protocol. (Id. at 40-41; Dkt. 104 at 54-56.) Lufthansa moves to compel Thales to run the searches listed in its February 2020 letter and produce additional documents. (Dkt. 100 at 39.)

In patent infringement suits in this district, some judges presumptively limit the number of key word searches that can be demanded during discovery to fewer than ten. See, e.g., mSIGNIA, Inc. v. InAuth, Inc., No. 8:17-cv-01289-AG-KESx, 2018 U.S. Dist. LEXIS 224190, at *2 (C.D. Cal. Oct. 18, 2018). Lufthansa's proposed search protocol is excessive. Lufthansa did not discharge its obligation to meet and confer in good faith by making such a proposal and then demanding that Thales craft reasonable searches. The Court cautioned the parties at the initial hearing not to pursue an “all or nothing” approach to discovery, which is what Lufthansa did when it proposed the subject search protocol and then refused to modify it unless Thales took up the laboring oar. Thales's objections are well-taken, and the Court DENIES Lufthansa's motion to compel a further response to Requests 10 and 11.

IV. Rule 30(b)(6) Depositions.

*6 Lufthansa also moves to compel Thales to produce witnesses sufficiently prepared to testify about 8 topics in the deposition notice served on September 19, 2019. (Dkt. 100 at 3, 44-45.) Thales already produced declarations, had three witnesses testify (Mr. Acebedo, Mr. Marzzacco, and Ms. Ware) and another employee provided an interview per a court order. (Dkt. 104 at 56-57.) Thales had not designated anyone to testify on topic 1 and a “small portion of 4 and 6” because those depositions were never scheduled. (Id. at 60-61, 63.) Thales asserts that topic 4 was covered, despite the lack of designation. (Id. at 61-62.)

Lufthansa argues that the witnesses were “wholly unprepared.” (Dkt. 100 at 45.) Lufthansa complains that while Mr. Acebedo was the person most knowledgeable about how the sales/purchases data spreadsheets were prepared, he did not review any paper files or participate in searches for electronic files outside of the database used to create the spreadsheets. (Id. at 46.) Lufthansa complains that Mr. Marzzascco was unprepared to testify about joint advertising between Thales and AES in France because he had not contacted Thales's Director of Sales for Europe. (Id. at 47.) Ms. Ware had not read individual statements of work in advance of her deposition, and she could not testify about amendments to certain contracts in 2012. (Id. at 49-50.)

The examples cited by Lufthansa do not persuade the Court that the witnesses designated by Thales were so unprepared for all 8 topics so as to justify compelling additional testimony from new witnesses, particularly since some of the events at issue are remote in time, Thales largely stores documents electronically, and Thales produced declarations after the depositions relaying information from inquiries made with other employees. (Id. at 52; Dkt. 104 at 57-58.) Moreover, Lufthansa previously told the Court, “I'm sure that if they prepare a 30(b)(6) on relatively short notice, there are going to be some questions they say, I don't know. ... but given the timeframe we accept that.” (Dkt. 46 at 30.)

Having failed to carry its burden of demonstrating that Thales failed to comply with its Rule 30(b)(6) obligations, the Court DENIES Lufthansa's motion to compel additional designations and/or deposition testimony.

V. Cost Shifting.

Lufthansa asks the Court to shift its costs in bringing the instant motion to Thales “due to Thales' unreasonable position and delay” under Rule 37(a)(5). (Dkt. 100 at 52, 57.) Lufthansa accuses Thales of failing to be forthright by failing to state in 2019 that it would not produce additional documents. (Dkt. 100 at 55.) Lufthansa argues that Thales's refusal to produce more documents now is “without any reasonable justification.” (Id. at 5)

Thales argues, “If any costs are here awarded, they should be awarded to Thales.” (Id. at 55.) “Lufthansa has welched every time, repeatedly coming back demanding more from Thales than it had already agreed to accept.” (Id. at 8.)

Lufthansa fails to acknowledge Thales's position that Thales thought it was working on tight deadlines to create spreadsheets with the most relevant information pursuant to a compromise agreement, only to learn after its extensive efforts that Lufthansa wanted more and would not agree to any binding compromise. Many of Thales's objections based on relevancy, over breadth, and burden are well-taken, and Thales's choice to seek binding compromises to narrow the scope of discovery was justified – indeed, it was directed by the Court.

Under Rules 26(c)(1) and 37(a)(5)(C), when the Court grants in part and denies in part a discovery motion, the Court has discretion to shift costs. Here, the Court finds no basis to shift Lufthansa's costs to Thales and declines to shift Thales's costs to Lufthansa, having largely granted Thales the relief sought, i.e., a close to this matter.

VI. Disposition.

*7 Within sixty (60) days of this order, Thales shall produce a spreadsheet for Northern Ireland with the same data fields as the spreadsheet it previously produced for the UK. Upon doing so, Thales will have fully satisfied its discovery obligations under the subpoena and deposition notice served by Lufthansa in this action.