SGII, Inc. v. Suon
SGII, Inc. v. Suon
2021 WL 6752324 (C.D. Cal. 2021)
December 29, 2021
Early, John D., United States Magistrate Judge
Summary
The Court denied Plaintiff's request for a computer forensic examination of Adonis's devices, communications between Defendant and Arminak, surveillance video of Defendant at Adonis's facilities, and telephone records of Defendant's Adonis work telephone. The Court granted Plaintiff's request for communications between Defendant and Arminak, and ordered Adonis to conduct a reasonable and diligent search and produce any and all nonprivileged documents responsive to RFP No. 3.
SGII, Inc.
v.
Soda Chanda Suon
v.
Soda Chanda Suon
Case No. 8:21-cv-01168-DOC (JDEx)
United States District Court, C.D. California
Filed December 29, 2021
Counsel
Daniel Joshua Salinas, Meghan Marie McBerry, Robert Brian Milligan, Seyfarth Shaw LLP, Los Angeles, CA, for SGII, Inc.Early, John D., United States Magistrate Judge
Proceedings: (In Chambers): Order re Motion [Dkt. 26] and Application [Dkt. 28]
I. INTRODUCTION
*1 On July 6, 2021, SeneGence International, Inc. (“Plaintiff”), a cosmetics company, filed a complaint against a former employee, Soda Chanda Suon (“Defendant”), alleging he misappropriated Plaintiff's trade secrets. See generally Dkt. 1 (“Complaint”). In summary, Plaintiff alleges that Defendant had worked for Plaintiff for less than six months when he inserted a personal USB drive into Plaintiff's computer and copied and/or transferred at least 200 files containing Plaintiff's trade secrets onto the USB drive. Id. ¶¶ 5, 7. Plaintiff seeks an injunction enjoining Defendant from disclosing Plaintiff's trade secrets and requiring Defendant to produce his devices for inspection by Plaintiff. Id. ¶ 14. The Complaint asserts claims for breach of contract, breach of duty of loyalty, violation of California Penal Code § 502, and trade secret misappropriation.
On Saturday, November 6, 2021, Plaintiff filed a Motion to Compel Adonis, Inc. (“Adonis”) to further testify and produce documents pursuant to a subpoena (Dkt. 26, “Motion”), accompanied by evidence (Dkt. 26-1, 26-2), Plaintiff's portion of a Local Rule 37-2 Joint Stipulation (Dkt. 27, “Joint Stipulation” or “Jt. Stip.”), and an application to file certain documents under seal (Dkt. 28, “Application”) with a supporting declaration of counsel (“Dkt. 28-1, “Declaration”). On November 18, 2021, Adonis filed an opposition (Dkt. 31, “Opposition” or “Opp.”) with a supporting declaration (Dkt. 31-1). On November 24, 2021, Plaintiff filed a reply brief. Dkt. 33.
In its Motion, Plaintiff seeks to compel Adonis to provide: (1) a computer forensic of a physical image of Adonis's S Drive on all Adonis computers used by Defendant (Request for Production [“RFP”] No. 1); (2) documents and deposition testimony regarding Ms. Arminak's communications with Defendant concerning Plaintiff (RFP No. 3 and Examination Topic No. 13); (3) surveillance videos showing Defendant's access and use of Adonis's computers for a limited time period (RFP No. 8); (4) documents regarding Defendant's telephone records at Adonis (RFP No. 9); and (5) deposition testimony regarding Ms. Arminak's rules, procedures, guidelines, instructions, or directives regarding Defendant's possession or use of Plaintiff's property (Examination Topic No. 17).
In connection with the Application, counsel attests that the documents sought to be filed under seal “contain confidential and proprietary information, including but not limited to, information regarding product information, individuals who have access to proprietary information, and proprietary information designated by the parties or third-parties under the Stipulated Protective Order.” Declaration, ¶ 5. Counsel further attests that the “information would be highly valuable to [Plaintiff's] competitors and would provide them with a competitive advantage in that they could not only steal [Plaintiff's] ideas, but could save the ample time and resources that would have otherwise been expended in the development of their own products.” Id., ¶ 6. Counsel avers that “this dispute concerns private matters that are of little to no legitimate interest to the general public.” Id., ¶ 7.
*2 The Motion came on regularly for hearing on December 9, 2021, and counsel for Plaintiff and Adonis were heard. The Court indicated its ruling on the Application and the Motion following argument and stated a written order would be issued. For the reasons set forth below and for the reasons stated on the record at the hearing, the Court DENIES the Application (Dkt. 28) and GRANTS in part and DENIES in part the Motion (Dkt. 26).
II. ADDITIONAL RELEVANT PROCEDURAL BACKGROUND
Shortly after filing the Complaint, on July 9, 2021, Plaintiff filed an ex parte application for a temporary restraining order (“TRO”) against Defendant. Dkt. 10. In that application, Plaintiff alleges that at the time Plaintiff employed Defendant, Defendant also worked for Plaintiff's alleged competitor, Adonis, a beauty manufacturing company. Id. at 2. Plaintiff claims Defendant engaged in suspicious behavior during the course of his employment, such as bringing a personal laptop to work in addition to the laptop Plaintiff provided him, and taking photos of Plaintiff's equipment on his personal cell phone. Id. at 4. In addition to seeking a TRO, Plaintiff also requested the Court allow Plaintiff to conduct expedited discovery, specifically permitting: (1) a four hour deposition of Defendant; (2) up to ten RFPs to Defendant; (3) a deposition of and ten RFPs to Defendant's current employer; and (4) a forensic examination of electronic devices or accounts of Defendant's employer that contain or once contained Plaintiff's property. Id.
The following day, on July 10, 2021, the Honorable David O. Carter, United States District Court Judge, issued an order granting Plaintiff's application in part and denying it in part. Dkt. 13 (“July 10 Order”). Relevant to the present dispute, Judge Carter granted Plaintiff's request to conduct expedited discovery. Id. at 2. With respect to Plaintiff's request for expedited discovery, the Court wrote:
Plaintiff also requests expedited discovery regarding the nature of Defendant's alleged misappropriation. Appl. at 21. A party seeking expedited discovery must establish good cause. Good cause exists “where the need for expedited discovery, in consideration of the administration of justice, outweighs the prejudice to the responding party.” Semitool, Inc. v. Tokyo Electron Am. Inc., 208 F.R.D. 273, 276 (N.D. Cal. 2002). Here, while potential harms to Plaintiff are compensable with money damages, Plaintiff's allegations remain quite serious, and expedited discovery is warranted to quickly uncover the full extent of Defendant's conduct. Defendant will not be prejudiced by the Court granting limited discovery as to the issues discussed in Plaintiff's Application. Appl. at 22.
Pursuant to the July 10 Order, Plaintiff served a Rule 45 subpoena upon Adonis for testimony and production of documents. On July 20, 2021, counsel for Adonis sent an email to counsel for Plaintiff indicting a willingness to permit a computer technician to inspect Adonis's computers onsite at Adonis at Plaintiff's expense. Dkt. 26-2 at 132 (CM/ECF pagination used herein for references to Dkt. 26-2). Adonis also agreed to produce a deponent for a Rule 30(b)(6) deposition to be conducted the first week of August. Id. The following day, counsel for Plaintiff responded that early August would be “too late” for a deposition, and further stated that a computer forensic examiner would need to examine Adonis's computer systems “this week.” Id. at 130. Counsel for Adonis then agreed to a computer inspection subject to an agreement regarding scope, but maintained that an Adonis representative could not sit for a deposition until early August because its CEO, Helga Arminak, was unavailable in late July. Id. at 127. Counsel for Plaintiff reiterated on July 21 that the deposition must take place in late July, but on July 22 agreed to conduct the deposition on August 3. Id. at 127, 109.
*3 On July 22, 2021, counsel for Adonis notified Plaintiff that Adonis had retained new counsel. Dkt. 26-2 at 108. The following day, counsel for Adonis stated that “[t]he [July 10] minute order does not apply to Adonis, and therefore Adonis will not proceed with the forensic inspection on Tuesday.” Id. at 106. However, Adonis stated “[w]e are reviewing the computer and Adonis network to determine whether any [of Plaintiff's] files were transferred [onto Adonis's computers].” Id. Adonis also confirmed it would produce a corporate representative for a deposition on August 3. Id. On July 25, Plaintiff sent Adonis a letter accusing Adonis of engaging in “gamesmanship” and “hiding” potential evidence of its wrongdoing by backing out of its prior agreement to allow Plaintiff to conduct a computer inspection, and further stated its intention to proceed with the July 27 forensic inspection of Adonis's computer systems. Id. at 102-103.
On July 29, 2021, counsel for Adonis emailed Plaintiff requesting that its deponent appear virtually on August 3 because the deponent is a “high risk” individual. Dkt. 26-2 at 97. Plaintiff insisted on having the deposition be in person, but later agreed to allow the deposition to proceed remotely. Id. at 95, 97. On August 2, Adonis produced some documents responsive to certain request for production served by Plaintiff in advance of the August 3 deposition. Id. at 94. Plaintiff responded later that day that Adonis's production was “unacceptable” because Adonis had not produced any emails or text messages. Id. at 92. On August 3, Plaintiff deposed Adonis's representative, Anca Brunotto, remotely. Id. at 87. The following day, Plaintiff sent Adonis a letter expressing its frustration that Adonis presented Brunotto as its deponent rather than its CEO Arminak because Brunotto was not prepared to discuss all the topics listed in the deposition notice. Id. at 87-88. Plaintiff requested that Adonis produce the “person most knowledgeable” on deposition topics 6, 8, 9, 12, 13, and 14 for a subsequent deposition, and further stated that Ms. Arminak is likely to be the person most knowledgeable. Id. at 87-89.
On August 24, 2021, Plaintiff took a Rule 30(b)(6) deposition of Adonis's computer forensic examiner. Dkt. 26-2 at 56. On August 30, Plaintiff sent Adonis a letter requesting a deposition of Arminak, and further stated the examiner's report had been deficient because the examiner had not prepared a physical image of Adonis's S drive, “which is needed to identify any deleted files.” Id. at 49. On September 20, Adonis sent Plaintiff a letter stating that Adonis had already voluntarily provided Plaintiff a forensic report of examination of two of Defendant's workplace computers and the S drive as well as its forensic examiner and VP of Innovation and Product Development for deposition. Id. at 41. Moreover, Adonis wrote, “[t]he forensic examination report, which Adonis voluntarily produced to Plaintiff, indicated very few results responsive to Plaintiff's requested search terms, [and] those results gave no indication there was any knowledge or collusion on Adonis's behalf.” Id. Although counsel continued to correspond regarding the disputes, they did not ultimately reach an agreement. Id. at 11, 16. On October 6, 2021, counsel for Plaintiff sent an email to counsel for Adonis warning that “our client has authorized us to proceed with a motion to compel against Adonis and/or to name Adonis in the pending action against Suon.” Id. at 12.
III. RELEVANT LAW
A. Discovery Under Rule 26
“Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.” Rule 26(b)(1). Relevance under Rule 26(b)(1) is defined broadly. See Snipes v. United States, 334 F.R.D. 548, 550 (N.D. Cal. 2020); V5 Techs. v. Switch, Ltd., 334 F.R.D. 306, 309 (D. Nev. 2019), aff'd sub nom. V5 Techs., LLC v. Switch, LTD., 2020 WL 1042515 (D. Nev. Mar. 3, 2020) (noting that relevance for discovery purposes remains broad after the 2015 amendments to Rule 26). “Information within this scope of discovery need not be admissible in evidence to be discoverable.” Rule 26(b)(1). “Generally, the purpose of discovery is to remove surprise from trial preparation so the parties can obtain evidence necessary to evaluate and resolve their dispute.” Duran v. Cisco Sys., Inc., 258 F.R.D. 375, 378 (C.D. Cal. 2009) (citations omitted).
*4 Relevance should be “construed ‘liberally and with common sense’ and discovery should be allowed unless the information sought has no conceivable bearing on the case.” Soto v. City of Concord, 162 F.R.D. 603, 610 (N.D. Cal. 1995) (quoting Miller v. Pancucci, 141 F.R.D. 292, 296 (C.D. Cal. 1992)); see Net-Com Servs., Inc. v. Eupen Cable USA, Inc., 2012 WL 12888106, at *3 (C.D. Cal. Dec. 10, 2012) (“Discovery should ordinarily be allowed under the concept of relevancy unless it is clear that the information sought can have no possible bearing upon the subject matter of this action.” (citation omitted)). Nonetheless, relevance for discovery purposes is not without boundaries. See Rule 26(b)(2); see, e.g., Rivera v. NIBCO, 364 F.3d 1057, 1072 (9th Cir. 2004) (“District courts need not condone the use of discovery to engage in fishing expeditions.” (internal quotation marks and citations omitted)); Gonzales v. Google, Inc., 234 F.R.D. 674, 679-80 (N.D. Cal. 2006). District courts have broad discretion in determining relevancy for discovery purposes. Mfg. Automation & Software Sys., Inc. v. Hughes, 2017 WL 5641120, at *3 (C.D. Cal. Sept. 21, 2017) (citing Surfvivor Media, Inc. v. Survivor Prods., 406 F.3d 625, 635 (9th Cir. 2005)).
B. Rule 45
“Rule 45 is the only discovery-related Rule that pertains to non-parties,” so “a Rule 45 subpoena is required to obtain discovery from a non-party.” Monster Energy Co. v. Vital Pharm., Inc., 2020 WL 2405295, at *5 (C.D. Cal. Mar. 10, 2020) (quoting Thompson v. Gonzales, 2016 WL 5404436, at *4 (E.D. Cal. Sept. 27, 2016)). Under Rule 45, a party may serve a subpoena commanding a nonparty to produce documents. See Rule 45(a). The scope of discovery allowed under Rule 45 is the same as that of Rule 26. See Miller v. Ghirardelli Chocolate Co., 2013 WL 6774072, at *2 (N.D. Cal. Dec. 20, 2013). However, “non-parties should not be burdened in discovery to the same extent as the litigants themselves,” and “[r]equests to nonparties should be narrowly drawn to meet specific needs for information.” Khan v. Rogers, 2018 WL 5849010, at *4 (N.D. Cal. Nov. 6, 2018) (citation omitted); see also Gilmore v. Jones, 339 F.R.D. 111, 120 (W.D. Va. 2021) (“[W]hen a subpoena is directed to a nonparty, courts must give the recipient's nonparty status ‘special weight,’ leading to an even more demanding and sensitive inquiry than the one governing discovery generally.” (internal citations and quotation marks omitted)).
Therefore, “[a] party or attorney responsible for issuing and serving a subpoena must take reasonable steps to avoid imposing undue burden or expense on a person subject to the subpoena.” Rule 45(d)(1). Rule 45(d)(2)(B)(ii) requires that, in ruling on a motion to compel a nonparty to produce documents in response to a subpoena over objections, courts “must protect a person who is neither a party nor a party's officer from significant expense resulting from compliance” with a subpoena. Separately, courts are required to limit discovery if it “is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive” or “is outside the scope permitted by Rule 26(b)(1).” Rule 26(b)(2)(C)(i), (iii); see Duong v. Groundhog Enters., Inc., 2020 WL 2041939, at *7 (C.D. Cal. Feb. 28, 2020) (explaining that Rule 26(b)(2)(C) applies in assessing the propriety of Rule 45 subpoenas). Further, courts may modify or quash a subpoena that “requires disclosure of privileged or other protected matter” or “subjects a person to undue burden.” Rule 45(d)(3)(A)(iii), (iv).
As the party issuing and seeking to compel compliance with the Subpoena here, Plaintiff has the initial burden to demonstrate that “the information sought is relevant and material to the allegations and claims at issue in the proceedings.” Khan, 2018 WL 5849010, at *4; see also Wi-Lan Inc. v. Research in Motion Corp., 2010 WL 2998850, at *3 (S.D. Cal. July 28, 2010) (the serving party has the burden of showing the appropriateness of the subpoena); Rule 45(d)(1)). If Plaintiff meets that burden, the burden shifts to Adonis to explain and support its objections. But where, as here, “discovery is sought from a non-party, the Court should be particularly sensitive to weighing the probative value of the information sought against the burden of the production on the nonparty.” Wi-Lan Inc., 2010 WL 2998850, at *3.
C. Deposition of a Corporation
*5 A corporation cannot be deposed per se; as a result, the Rules provide a mechanism under Rule 30(b)(6) for testimony to be taken from a person answering questions on behalf of the entity. See Hooker v. Norfolk S. Ry. Co., 204 F.R.D. 124, 125 (S.D. Ind. 2001). Rule 30(b)(6) permits a party to notice the deposition of a corporation or other legal entity without specifically naming the individual to be deposed; instead, the noticing party may set forth “with reasonable particularity” the matters on which the examination is requested, thereby requiring the entity to designate one or more individuals to testify on those topics on behalf of the entity. Rule 30(b)(6) was “intended to assist both sides in the deposition process.” Memory Integrity, LLC v. Intel Corp., 308 F.R.D. 656, 660 (D. Or. 2015). On the one hand, the Rule will “curb the ‘bandying’ by which officers or managing agents of a corporation are deposed in turn but each disclaims knowledge of facts that are clearly known to persons in the organization and thereby to it.” Rule 30, Advisory Committee Notes (1970 Amendment). On the other hand, the “provision should also assist organizations which find that an unnecessarily large number of their officers and agents are being deposed by a party uncertain of who in the organization has knowledge.” Id.
In response to a Rule 30(b)(6) deposition notice, “corporate parties have an obligation to present witnesses who are capable of providing testimony on the noticed topics regardless of whether the information was in the witness's personal knowledge, provided that the information is reasonably available to the corporation.” Memory Integrity, 308 F.R.D. at 661; Great Am. Ins. Co. of New York v. Vegas Const. Co., Inc., 251 F.R.D. 534, 539 (D. Nev. 2008) (“The duty to prepare a Rule 30(b)(6) designee goes beyond matters personally known to the witness or to matters in which the designated witness was personally involved.”). The selected individual need not be the “most knowledgeable” individual regarding a designated subject. Est. of Rosado-Rosario v. Falken Tire Corp., 319 F.R.D. 71, 74 (D.P.R. 2016). The corporation must identify and prepare its witnesses “so that they may give complete, knowledgeable and binding answers on behalf of the corporation.” Sprint Commc'ns Co. L.P. v. Theglobe.com, Inc., 236 F.R.D. 524, 528 (D. Kan. 2006) (internal quotation marks and footnote omitted); Starlight Int'l Inc. v. Herlihy, 186 F.R.D. 626, 639 (D. Kan. 1999) (observing that a corporation has “a duty to make a conscientious, good-faith effort to designate knowledgeable persons for Rule 30(b)(6) depositions and to prepare them to fully and unevasively answer questions about the designated subject matter”). “The designating party has a duty to designate more than one deponent if necessary to respond to relevant areas of inquiry on the noticed topics.” Great Am. Ins. Co. of New York, 251 F.R.D. at 539.
Because “Rule 30(b)(6) places substantial responsibilities and burdens on the responding corporate party,” Memory Integrity, 308 F.R.D. at 661, for the Rule “to effectively function, the requesting party must take care to designate, with painstaking specificity, the particular subject areas that are intended to be questioned, and that are relevant to the issues in dispute.” Prokosch v. Catalina Lighting, Inc., 193 F.R.D. 633, 638 (D. Minn. 2000). While a corporation must make a good faith effort to prepare a Rule 30(b)(6) witness to “fully and unevasively answer questions about the designated subject matter ... that task becomes less realistic and increasingly impossible as the number and breadth of noticed subject areas expand.” Apple, Inc. v. Samsung Electronics Co., Ltd., 2012 WL 1511901, at *2 (N.D. Cal. Jan. 27, 2012) (internal quotation marks omitted). Rule 30(b)(6) does not permit “burdening the responding party with production and preparation of a witness on every facet of the litigation.” Apple, 2012 WL 1511901, at *2.
The “ ‘proper procedure to object to a Rule 30(b)(6) deposition notice is not to serve objections on the opposing party, but to move for a protective order.’ ” Rutherford v. Evans Hotels, LLC, 2018 WL 6246516, at *3 (S.D. Cal. Nov. 29, 2018) (quoting Beach Mart, Inc. v. L & L Wings, Inc., 302 F.R.D. 396, 406 (E.D. N.C. 2014)). “Put simply and clearly, absent agreement, a party who for one reason or another does not wish to comply with a notice of deposition must seek a protective order. New England Carpenters Health Benefits Fund v. First DataBank, Inc., 242 F.R.D. 164, 165–66 (D. Mass. 2007) (footnotes omitted).
D. Sealing of Court Records
*6 As the public has a presumptive right of access to court records, in connection with non-dispositive motions, good cause must be shown to support a filing under seal. See Kamakana v. City and County of Honolulu, 447 F.3d 1172, 1176 (9th Cir. 2006). “Parties seeking to file documents under seal with this Court must follow the procedures set forth in the Local Rules [C.D. Cal. L.R. 79-5 et seq.].” Urakchin v. Allianz Asset Mgmt. of Am., L.P., 2017 WL 1836351, at *2 (C.D. Cal. Mar. 28, 2017); see also Doe v. Law Offices of Andrew Weiss, 2020 WL 5983929, at *2 (C.D. Cal. July 30, 2020) (denying an application to seal that failed to substantially comply with the requirements set forth in L.R. 79-5.2.2); Markel Am. Ins. v. Internet Brands, 2018 WL 5085123, at *1 (C.D. Cal. Aug. 28, 2018).
Local Rule 79-5.2.2 provides for different procedures for seeking to file documents under seal depending whether they are the filing party's own documents (Local Rule 79-5.2.2(a)) and documents designated confidential by a non-filing party (Local Rule 79-5.2.2(b)). See L.R. 79-5.2.2 (“A person seeking to file documents under seal must follow the procedures set forth below in subsection (a), unless someone else has designated these documents confidential pursuant to a protective order, in which event those involved must follow the procedures set forth in subsection (b).”)
Under Local Rule 79-52.2(a), a party seeking leave to file its own documents under seal, must, among other things, file a declaration making an appropriate showing to support sealing and “informing the Court whether anyone opposes the Application” and file “[a]n unredacted version of the document(s) proposed to be filed under seal, conspicuously labeled ‘UNREDACTED VERSION OF DOCUMENT PROPOSED TO BE FILED UNDER SEAL,’ with any proposed redactions highlighted.” L.R. 79-5.2.2(a)(i)(2),(a)(iv).
Under Local Rule 79-5.2.2(b), which applies to documents designated as “confidential” under a protective order by a party other than the filing party, in addition to the procedural requirements of subsection (a), above, the filing party must confer with the designating party prior to filing the application and, in the supporting declaration, describe “in detail the efforts made to resolve the issue,” with the papers served on the designating party, with such designating party required to “[w]ithin 4 days of the filing of the Application ... file a declaration establishing that all or part of the designated material is sealable, by showing good cause or demonstrating compelling reasons why the strong presumption of public access in civil cases should be overcome, with citations to the applicable legal standard.” L.R. 79-5.2.2(b)(i). A failure by the Designating Party to file such a declaration “may be deemed sufficient grounds for denying the Application.” Id.
The Protective Order entered in this case (Dkt. 17) provides, in pertinent part:
The parties also acknowledge, as set forth in Section 14.3, below, that this Stipulated Protective Order does not entitle them to file confidential information under seal; rather, Civil Local Rule 79-5 sets forth the procedures that must be followed and the standards that will be applied when a party seeks permission from the Court to file material under seal. There is a strong presumption that the public has a right of access to judicial proceedings and records in civil cases.
Dkt. 17, ¶ 3. Further, Judge Carter's Initial Standing Order issued by Judge Carter provides:
*7 The existence of a Protective Order, a Stipulated Confidentiality Order, or the like, issued by the assigned Magistrate Judge relating to the treatment of documents produced during discovery, does not constitute a court Order permitting an under seal filing. An application to seal that is based solely on the existence of such an Order will be summarily denied. In addition, reliance upon the parties' designation of documents as “Confidential,” “Highly Confidential,” “Attorneys' Eyes Only,” etc. is insufficient. Rather, the party must provide competent evidence explaining why the document(s) should be filed under seal.
If the party seeking to file documents under seal (the “filing party”) is not the party with an interest in the sealing/confidentiality of the documents, then the filing party shall provide the interested party with its proposed application to seal at least two (2) business days in advance of any filing. If the interested party seeks to have the documents filed under seal, it shall file a Declaration setting forth competent evidence explaining why the document(s) should be filed under seal. If the interested party fails to file a Declaration within this two−day period, the filing party is relieved of any obligation to file an application to seal and may publicly file the documents along with a Declaration of Compliance with this paragraph.
Dkt. 9 (“Initial Standing Order”), § VII.
IV. DISCUSSION
A. Plaintiff's Application to Seal is Denied
With respect to Plaintiff's sealing Application, the Declaration filed in support states that the records sought to be sealed are both Plaintiff's “confidential” documents (see Declaration, ¶¶ 4-5) and information “designated by parties or third-parties under the Stipulated Protective Order” (id., ¶ 4). As noted, under Local Rule 79-5.2.2, the procedures are different depending on whether the material sought to be sealed is the requesting party's own records, or records designated as confidential under a protective order by a third party. Here, Plaintiff did not address the specific provisions of either Local Rule 79-5.2.2(a) or 79-52.2(b). In fact, Plaintiff has not complied with either provision.
Plaintiff did not file[1] an unredacted version of the documents proposed to be filed under seal, with the portions to be sealed highlighted. As such, it does not comply with Local Rule 79-5.2.2(a). The lack of compliance is not merely technical, as without an unredacted version of the documents sought to be filed under seal, the Court cannot make an independent assessment of whether the material facially rises to the level to overcome the presumption of public access to documents filed in a public docket, in public litigation.
Further, the Application, fails to state whether any person opposes the Application and does not identify the “third-parties” who counsel attested designated materials as confidential under the Protective Order. No third party filed a declaration making any showing to support sealing of any material. As noted, Local Rule 79-5.2.2, the Protective Order, and Judge Carter's Initial Standing Order all provide that the mere fact that a party designated materials as confidential or highly confidential under a protective order does not, of itself, authorize the parties to file such materials under seal with the Court. Regardless of whether the Court considers the Application to have been brought under Local Rule 79-5.2.2(a) or 79-5.2.2(b), Plaintiff has not complied.
*8 As a result, the Application (Dkt. 28) is DENIED. No further action shall be taken by Plaintiff regarding the filing of the documents at issue in the Application. Rather, the Court will decide the Motion based on the redacted versions provided, along with all other evidence and argument presented. See Reed v. NBTY, Inc., 2014 WL 12284044, at *2 n.5 (C.D. Cal. Nov. 18, 2014) (finding a party did not comply with the local rules for filing documents under seal by failing to file unredacted versions of the documents on the docket, and thus “[t]his Order is based only on the opposition Plaintiffs publicly filed ”).
B. The Motion is Denied in Large Part
As discussed above, the Federal Rules of Civil Procedure do not allow for the unfettered discovery directed to third parties. When assessing a subpoena directed to a nonparty, the Court has an independent obligation to consider: (1) whether the requesting party needs the information sought, meaning that the information offers some value over and above what the requesting party already has; (2) whether the requesting party can obtain the same or comparable information that would satisfy its needs from other sources; and (3) whether the request will impose a cognizable burden on the responding party. Gilmore, 339 F.R.D. at 120 (internal citations omitted). Further, as with all discovery, the requests must be proportional to the needs of the case, balancing, the relevance of the material sought against, among other things, the burden of production.
Here, to the extent Plaintiff relies on Defendant's hearsay statements to show relevance of the discovery sought, as both Plaintiff and Adonis that Defendant has been untruthful in connection with his description of key events in connection with this case and may have (the Court makes no finding here) committed perjury about material matters during his deposition (see Jt. Stip. at 11 [Plaintiff observing that a key portion of Defendant's deposition testimony was “all lies”]), the Court accords little weight to the hearsay recantation statements of Defendant offered by Plaintiff in assessing relevance.
Turning to the RFPs/deposition topics at issue, for the reasons that follow, the Court finds that all but one of the RFPs seek information that is unduly burdensome to Adonis as a third party under Rule 45(d)(1) and/or is disproportionate to the needs of the case at present under Rule 26(b)(1).
1. Computer Forensic Inspection of Adonis's Devices (RFP No. 1)
RFP No. 1 seeks:
ALL DOCUMENTS, data information, or property that belongs to SENEGENCE. For purposes of this Request, please provide for computer inspection all computers owned or used by DEFENDANT, whether hand-held laptop, desktop, or tablet and any external hard drives, Zip drives, floppy disks, DVDs, USB devices, or other drives or electronic media storage devices, and all email account and other virtual storage repositories in your possession, custody, or control, that contained or once contained SENEGENCE trade secrets, confidential information, or other property, including external I-O Data USB drive serial no. 000010b9b090136, email account sodacs@adoniscontractmanufacturer.com, and any ADONIS computers, other electronic devices, email accounts and other virtual repositories used by DEFENDANT.
Plaintiff specifically requests computer forensic examination of: (1) the physical imaging and computer forensic examination of Adonis's “S Drive”; (2) Anca Brunotto's work computer used by Defendant; and (3) production of a full file listing and listing of all deleted files (with all metadata) on all Adonis computers used by Defendant during the period of his overlapping employment through when he admitted to deleting Plaintiff's files. Jt. Stip. at 5. Plaintiff contends good cause exists to allow for a computer forensic examination and further claims it is “entitled to know what Defendant was working on for Adonis while he was also working for [Plaintiff] and at the time that he inserted a USB drive with [Plaintiff] files into Adonis's computers.” Id. at 20-21. Plaintiff asserts a physical image of Adonis's S Drive is needed to capture any Plaintiff files that may have been deleted from the drive, and that it is entitled to search Brunotto's computer because Defendant used that computer at one point. Id. at 22-23. Plaintiff claims it cannot obtain this information from Defendant because Defendant claims he destroyed the USB drive he used to take Plaintiff's files. Id. at 24. Furthermore, Plaintiff states this request is not unduly burdensome because the cost of producing a physical image of the S Drive is minimal. Id. Adonis contends it should not be ordered to undergo further computer forensic examination because “the expansive forensic review that Adonis had already completed gave no indication there was any knowledge or collusion on Adonis's behalf with respect to Defendant's actions,” and such an examination would be unduly burdensome. Opp. at 10.
*9 Courts in this circuit have been reluctant to grant motions compelling forensic examinations of a party's computers. See Moser v. Health Ins. Innovations, Inc., 2018 WL 6735710, at *5 (S.D. Cal. Dec. 21, 2018) (“Forensic examination is generally regarded as a drastic step ... [but] could be appropriate if there is a factual finding by the Court of improper conduct on the part of the responding party or intentional destruction of relevant electronic evidence.”) (internal citations and quotation marks omitted); Alexis v. Rogers, 2017 WL 1073404, at *4 (S.D. Cal. Mar. 21, 2017) (“Compelled forensic imaging is not appropriate in all cases, and courts must consider the significant interests implicated by forensic imaging before ordering such procedures.” quoting John B. v. Goetz, 531 F.3d 448, 460 (6th Cir. 2008))). “Given the legitimate privacy and other interests at issue, absent specific, concrete evidence of concealment or destruction of evidence, courts are generally cautious about granting a request for a forensic examination of an adversary's computer.” Sophia & Chloe, Inc. v. Brighton Collectibles, Inc., 2013 WL 5212013, at *2 (S.D. Cal. Sept. 13, 2013). “Further, a compelled forensic examination is only appropriate where there is a protocol in place that will protect against the unwarranted invasion of privacy.” Alexis, 2017 WL 1073404, at *4.
Here, a forensic examination was conducted, but Plaintiff argues it was insufficient. The Court finds that the “drastic step” of a second forensic examination of a non-party's computers is unwarranted here. First, as noted, Adonis conducted a forensic examination. Although Plaintiff challenges the sufficiency of that examination, there is no evidence that Adonis destroyed or intentionally tried to hide evidence in connection with its examination. Second, Adonis, even before the examination was completed, quickly notified Plaintiff that forensics indicated that Defendant had accessed the USB drive on an Adonis computer despite Defendant's denial of having done so. See Dkt. 33-1 at 2, ¶¶ 5-6. Such conduct evidences good faith on the part of Adonis, as least as to that disclosure. Third, again, although Plaintiff questions the thoroughness of the examination, other than Defendant's hearsay statements (contradicted by his testimony under oath) which the Court does not credit, there is no substantive evidence to call into question the results of Adonis's examination. Third, Adonis is a non-party and issues of burden, expense, privacy, etc., all must be balanced against ordering a further forensic examination when one has already been performed. Based on the information before the Court, a further forensic examination is not warranted here.
2. Communications between Defendant and Arminak (RFP No. 3)
RFP No. 3 seeks “Any and all documents concerning any communications (including emails and text messages), from January 1, 2020 to present between ADONIS and DEFENDANT concerning SENEGENCE.” Plaintiff claims the requested documents are “highly relevant for [Plaintiff] to understand the full extent of Defendant's misappropriation activities, including any instructions, assistance, or involvement from Adonis, Adonis's acquisition of [Plaintiff's] property, and Adonis's use or disclosure of [Plaintiff's] property.” Jt. Stip. at 26. Plaintiff's proffer of relevance meets the threshold under Rule 26. While Adonis “vehemently denies” Defendant's representations that such messages exist (Opp. at 2), as discussed at the hearing, Adonis apparently refused to conduct a search of its employees' email for potentially responsive documents. Adonis has proffered no evidence of any concrete burden in conducting a search of email or other communication streams of Adonis employees who might reasonably be expected to have any potentially responsive information. Although RFP No. 3 uses the broad language “Any and all documents concerning ...,” the subject matter appears to be narrowly circumscribed by date range, participant, and subject. The information sought by the request, and a search of communication streams of Adonis employees, including Ms. Arminak, that could reasonably be expected to contain responsive information, are appropriate, not unduly burdensome, and not disproportionate to the needs of the case. Accordingly, the Court grants Plaintiff's Motion with respect to RFP No. 3.
3. Surveillance Video of Defendant at Adonis's Facilities (RFP No. 8)
*10 RFP No. 8 seeks, “Any and all documents concerning Defendant's access and use of Adonis's computers, email system, and network, including all company property, electronic devices, and accounts assigned to DEFENDANT and all network and internal logs from January 1, 2021 to the present CONCERNING DEFENDANT.” Plaintiff states that “Adonis should be compelled to produce the surveillance videos of Defendant's access and use of Adonis's computers.” Jt. Stip. at 28. The Court finds a request for Adonis to search for and produce such surveillance videos is unduly burdensome under Rule 45(d)(1) and not proportional to the needs of the case under Rule 26(b)(1). Plaintiff claims such videos would show Defendant's use of certain “printouts” at Adonis and show when he inserted the USB drive containing Plaintiff's property into Adonis's computers. Jt. Stip. at 28. The Court is unaware of which “printouts” Plaintiff is referring to because the portion of the Joint Stipulation describing the relevance of the printouts has been redacted and the Court has not been provided with an unredacted copy. As for showing when Defendant inserted the USB drive, as Adonis already disclosed when Defendant inserted the USB drive immediately upon learning of it (Dkt. 31-1 at 2, ¶ 6), the marginal relevance of any video of the event is outweighed by the burden, expense, and potential privacy and proprietary interests implicated by the search for and disclosure of internal video recordings. See, e.g. Putscher v. Smith's Food & Drug Ctrs., 2014 WL 2835315, at *4-5 (D. Nev. June 20, 2014) (denying plaintiff's motion to compel surveillance video because the burden of production outweighed any likely benefit where the plaintiff sought surveillance footage of a fact not in dispute in the case). Even were such footage relevant, common sense dictates that a request to search through nearly a year's worth of footage is disproportionate to the needs of the case. Thus, the Court denies Plaintiff's Motion with respect to RFP No. 8 seeking Adonis's internal video surveillance.
4. Telephone Records of Defendant's Adonis Work Telephone (RFP No. 9)
RFP No. 9 seeks “Any and all DOCUMENTS CONCERNING DEFENDANT'S access and use of Adonis's telephone and cellular devices, including all phone records and call logs from January 1, 2021 to the present.” Plaintiff claims the phone records are relevant to demonstrating the full extent of Defendant's wrongdoing, as these records could show who Defendant called and why from Adonis's telephone on the days he downloaded, printed, or accessed Plaintiff's property from Adonis's network. Jt. Stip. at 28. The Court also finds this RFP is unduly burdensome under Rule 45(d)(1) and disproportionate to the needs of the case under Rule 26(b)(1). Among other defects, the claim of relevance is entirely speculative and in some sense nonexistent. For example, it is unclear how telephone records would bear on “why” Defendant made certain calls. But even were the Court to accept a claim that a chain of calls preceded, coincided with, or postdated Defendant's insertion of the USB device into Adonis's computer (a wholly speculative claim), a demand for more than six months of telephone records is grossly overbroad, unduly burdensome, and disproportionate to the needs of the case. See Salinas v. Procter and Gamble Co., 2020 WL 8455137, at *3 (C.D. Cal. Oct. 9, 2020) (finding plaintiff's request disproportional to the needs of the case because plaintiff did not proffer any “non-speculative” evidence supporting his request); Elkin v. New York Life Ins., 2017 WL 4047235, at *3 (C.D. Cal. Sept. 8, 2017) (finding request to be disproportional to the needs of the case given its “speculative nature”). Accordingly, the Court denies Plaintiff's Motion with respect to RFP No. 9.
5. Further Rule 30(b)(6) Deposition of Ms. Arminak (Topic Nos. 13 and 17)
Plaintiff claims Ms. Brunotto, Adonis's VP of Innovation and Product Development, was an inadequate corporate witness because she was unprepared to testify on behalf of Adonis as to Topic Nos. 13 and 17. Topic 13 requests testimony on “Adonis's communications from January 1, 2020, to the present, with any current or former [Plaintiff] employee, including, but not limited to, Defendant, concerning [Plaintiff].” Plaintiff states it is requesting testimony about any communications between Ms. Arminak and Defendant about his employment with Plaintiff. Jt. Stip. at 8. Topic No. 17 requests testimony on “Any rules, procedures, guidelines, instructions, or directives of Adonis regarding Defendant's possession or use of a competitor or other third party's trade secret or confidential information, including, but not limited to, the dissemination of any such rules, procedures, guidelines, instructions, or directives by Adonis to Defendant, and Adonis's enforcement thereof.” Plaintiff seeks to depose Ms. Arminak as Adonis's Rule 30(b)(6) witness because her “hands are all over this dispute.” Id. at 9. The Court rejects Plaintiff's request for two reasons.
*11 First, to the extent Plaintiff demands Adonis designate Ms. Arminak as its designee for Topic Nos. 13 and 17, Rule 30(b)(6) directs that the corporation, not counsel for the party taking the deposition, determines its designee, subject to the requirements of Rule 30(b)(6) for doing so. Thus, Plaintiff cannot unilaterally determine Adonis's Rule 30(b)(6) designee. Second, in support of the Motion, Plaintiff provided a portion of the transcript of Ms. Brunotto's testimony to argue she was unprepared to serve as Adonis's corporate witness, but these selected portions, without greater context, do not demonstrate Ms. Brunotto was unprepared. Plaintiff has not met its burden to compel a further Rule 30(b)(6) deposition at this stage. However, this ruling is without prejudice to Plaintiff, following a full meet and confer between counsel, seeking leave to take a second deposition of Adonis under Rule 30(a)(2)(A)(ii) upon a further showing that Ms. Brunotto's testimony did not reflect the full information known to Adonis regarding the topics of examination provided. In addition, nothing in this ruling prohibits Plaintiff from serving other Rule 45 subpoenas, subject to the July 10 Order, Rule 26, and any operative Scheduling Order.
V. CONCLUSION AND ORDER
For the foregoing reasons, the Court DENIES the Application (Dkt. 28) and DENIES the Motion (Dkt. 26) except that Adonis is ORDERED to: (1) conduct a reasonable and diligent search, including of communications streams of relevant officers and/or employees, including Ms. Arminak, and produce any and all nonprivileged documents responsive to RFP No. 3 in its possession, custody, or control within 28 days from the date of the hearing on the Motion, as announced at the hearing, that is, by January 6, 2022; and (2) produce all other documents that Adonis has otherwise agreed to produce by January 6, 2022. Nothing in this Order prevents Plaintiff from propounding any other discovery, subject to the July 10 Order, Rule 26, and any operative Scheduling Order, nor does this Order prevent Plaintiff from seeking authorization to take a second deposition of Adonis under Rule 30(a)(2)(A)(ii) if a proper showing is made, following a proper attempt to meet and confer to, in good faith, attempt to resolve any dispute.
IT IS SO ORDERED.
Initials of Clerk: mba
Footnotes
Plaintiff's counsel stated at the hearing that counsel delivered, but did not file, a hard copy of the unredacted versions of the documents to the Court. The Court did not receive such versions. Regardless, delivery of “chambers copies” does not comply with the Local Rules for placing material properly before the Court. See Realtime Data LLC v. Teradata Operations, Inc., 2016 WL 9450682, at *2 (C.D. Cal. May 3, 2016) (“The Court received a chambers copy of the mentioned declaration, but that declaration wasn't filed (in any form—redacted or unredacted) on the public docket. So the declaration isn't properly before the Court. The declaration can't justify granting the [Sealing] Application.”).