Maint. Enters., LLC v. Orascom E&C USA, Inc.
Maint. Enters., LLC v. Orascom E&C USA, Inc.
2017 WL 11703413 (S.D. Iowa 2017)
December 8, 2017

Bremer, Celeste F.,  United States Magistrate Judge

Possession Custody Control
Third Party Subpoena
Proportionality
Initial Disclosures
Download PDF
To Cite List
Summary
The Court granted the motions to quash the subpoena, finding that the documents requested by OEC can be obtained from MEI, which would be more convenient and less burdensome. With respect to ESI, the Court found that OEC can obtain the documents from MEI, which would be more convenient and less burdensome.
Additional Decisions
MAINTENANCE ENTERPRISES, LLC, Plaintiff,
v.
ORASCOM E&C USA, INC. and Iowa Fertilizer Company, LLC, Defendants.
Orascom E&c USA, Inc., Counterclaimant,
v.
Maintenance Enterprises, LLC, Counterclaim Defendant
Case No. 3:16-cv-00014-SMR-CFB
United States District Court, S.D. Iowa, Davenport Division, Davenport Division
Signed December 08, 2017

Counsel

Mark E. Weinhardt, Elisabeth A. Tursi, Todd M. Lantz, The Weinhardt Law Firm, Des Moines, IA, Terry M. Giebelstein, Alexander Clement Barnett, Benjamin James Patterson, Lane & Waterman LLP, Davenport, IA, Brandon K. Black, Pro Hac Vice, Charles Parker Kilgore, Pro Hac Vice, Jones Walker LLP, Baton Rouge, LA, Christopher D. Cazenave, Pro Hac Vice, Jones Walker Waechter Poitevent Carrere & Den'Egre LLP, New Orleans, LA, Joseph P. Henner, Pro Hac Vice, Jones Walker LLP, Atlanta, GA, Michael C. Drew, Pro Hac Vice, Jones Walker Waechter Poitevent Carrere & Den'Egre LLP, New Orleans, LA, Richard John Tyler, Pro Hac Vice, Jones Walker LLP, New Orleans, LA, for Plaintiff.
Rebecca Woods, Pro Hac Vice, Seyfarth Shaw, Atlanta, GA, Anthony J. LaPlaca, Pro Hac Vice, Sara Beiro Farabow, Pro Hac Vice, Seyfarth Shaw LLP, Washington, DC, Roger W. Stone, Chad D Brakhahn, Jacob W. Nelson, Jeffrey A. Stone, P. Gail Brashers-Krug, Simmons Perrine Moyer Bergman PLC, Cedar Rapids, IA, for Defendant.
Bremer, Celeste F., United States Magistrate Judge

ORDER GRANTING MOTIONS TO QUASH

*1 This matter comes before the Court on the resisted Motions to Quash a subpoena duces tecum filed by non-party Brown & Root Industrial Services, LLC (“Brown & Root”), [ECF No. 153], and non-party Bernhard Capital Partners Management LP (“Bernhard”), [ECF No. 154]. A hearing was held on December 7, 2017. Appearing were attorneys: Benjamin Patterson, Christopher Cazenave, and Richard Tyler for Maintenance Enterprises, LLC (“MEI”), Brown & Root, and Bernhard; and Rebecca Woods, Jeffrey Stone, and Chad Brakhahn for Orascom E&C USA, Inc. (“OEC”).
This case involves a construction project. Plaintiff MEI is suing Defendant OEC for breach of contract alleging, among other things, damages for the diminution in value of MEI. MEI was sold to Bernhard in November 2016. Brown & Root is Bernhard's parent entity. On August 1, 2017, OEC served a subpoena duces tecum (the “Subpoena”) on Brown & Root and Bernhard commanding them to comply with seven requests for the production of documents by August 22, 2017. Subsequently, Brown & Root and Bernhard filed the instant motions. [ECF Nos. 153; 154]. OEC resists the motions. [ECF No. 163].
Both Brown & Root and Bernhard are not parties to this case, and as such, pursuant to Fed. R. Civ. P. 45, as well as Fed. R. Civ. P. 26, the Court looks to the proportionality of the request, and whether the request can be obtained from some other source that is more convenient, less burdensome, or less expensive. Brown & Root and Bernhard also claim that most of the documents requested in the Subpoena were provided to them by MEI during negotiations for the purchase of MEI, but that any of their internal analysis consist of proprietary commercially sensitive information which is entitled to protection from disclosure. [ECF Nos. 153-1 at 1–2; 154-1 at 1–2]. MEI has agreed to produce some of the documents that OEC has requested from Brown & Root and Bernhard that are contained in the “due diligence room.” [ECF Nos. 153-1 at 2; 154-1 at 2]. Brown & Root and Bernhard argue that OEC can obtain this information from MEI, which would be more convenient and less burdensome. Id.
On October 23, 2017, OEC filed its response to the motions to quash. [ECF No. 163]. OEC asserts it needs Brown & Root and Bernhard to produce these documents so that it may appropriately respond to MEI's damages claim for diminution in value. OEC argues obtaining these documents from MEI would not be more convenient and less burdensome. OEC argues it is unclear whether all the documents it requested from Brown & Root and Bernhard are in MEI's possession. OEC also argues it cannot more easily obtain certain documents that are in MEI's possession because MEI has been nonresponsive to OEC's requests for the production of similar documents. Id. at 8–9. At the November 2017 status conference it was represented that the due diligence room documents would be promptly produced. At the December 2017 status conference, the parties asked for additional time, [see ECF No. 184], through January 5, 2018 to produce these documents. Discovery has been delayed four months, and the parties are no closer to narrowing or resolving this dispute.
*2 Based upon a review of the subpoena duces tecum, the briefing, and arguments made at the hearing, the Court finds that the motions to quash should be granted. OEC's subpoenas request documents that can essentially be broken into three categories: (1) documents contained in the due diligence data room, (2) documents MEI has in its possession, and (3) documents in the possession of the non-parties that are not in the due diligence data room, and that MEI does not have in its possession.
First, at the hearing on December 7, 2017, the parties informed the Court that MEI had begun production of documents to OEC from the due diligence data room. Further, OEC and MEI have agreed to a set of deadlines regarding the production of documents from the due diligence data room by MEI. The Court adopts these deadlines. See [ECF No. 184 at 2]. Many of the documents that OEC has requested Brown & Root and Bernhard to produce are documents contained in the due diligence data room. [ECF No. 153-2 at 4]. For instance, requests number five and six specifically request Brown & Root and Bernhard to produce documents related to the due diligence process of the sale. As such, the motions to quash are granted because requiring Brown & Root and Bernhard to produce the same documents would be duplicative.
Second, the Court agrees with Brown & Root and Bernhard that the vast majority of documents requested by OEC can be obtained from MEI, which would be more convenient and less burdensome to them. Fed. R. Civ. P. 26(b)(2)(C) (“On motion or on its own, the court must limit the frequency or extent of discovery otherwise allowed by these rules or by local rule if it determines that: (i) the discovery sought... can be obtained from some other source that is more convenient, less burdensome, or less expensive ....”). And “[a] plaintiff does not demonstrate a compelling need to seek duplicative third-party requests simply because a party in the underlying action fails to comply with document requests for the same information.” Nachurs Alpine Sols., Corp. v. Nutra-Flo Co., No. 15-CV-4015-LTS, 2017 WL 1380460, at *6 (N.D. Iowa Apr. 17, 2017) (quoting Tresona Multimedia, LLC v. Legg, No. 15 C 4834, 2015 WL 4911093 (N.D. Ill. Aug. 17, 2015). In general, a party to the litigation may have reasonable objections to the production of evidence and that does not necessarily mean that a non-party then must be required to produce that information. Therefore, the Court also grants the motion because it requests documents from non-parties that are in MEI's possession.
Until the due diligence room documents are produced and reviewed, the Court cannot determine what the “Category 3” documents are (documents relating to the sale of MEI in September of 2016 that only Brown & Root or Bernhard have), and whether these documents are entitled to protection. The Court cannot determine whether production of Category 3 documents is proportional to the needs of the case. Based upon this record, the Motions to Quash are granted as to Category 3 documents.
The Court notes that MEI failed to timely update its initial disclosures and discovery responses relating to its claim for diminution in value damages. Discovery closes on April 13, 2018. [ECF No. 170 ¶ 5]. The trial begins on September 24, 2018. Id. ¶ 6. OEC is entitled to relevant documents so that it can adequately prepare for trial or raise any motions relating to MEI's claim for diminution in value damages. After OEC has been fully provided documents contained in the due diligence data room and has had an opportunity to review those documents, it may craft a more narrowly-tailored subpoena requesting documents from non-parties if it believes relevant information exists. Any additional discovery request from Brown & Root or Bernhard shall be provided by January 19, 2018.
*3 For the reasons stated, Brown & Root and Bernhard's Motions to Quash are GRANTED. [ECF Nos. 153; 154].
IT IS SO ORDERED.