*1 This matter is before the Court on Plaintiffs’ motion to compel non-party PricewaterhouseCoopers LLP (“PwC”) to comply with subpoena [Doc. No. 406] and PwC's cross-motion to quash the subpoena [Doc. No. 419]. For the reasons that follow, Plaintiffs’ motion to compel is granted in part and denied in part and PwC's motion to quash is granted in part and denied in part.

Plaintiffs bring this putative class action securities fraud suit on behalf of themselves and all other persons who purchased securities of the Kraft Heinz Company (“KHC” or the “Company”) during the period from November 5, 2015 to August 7, 2019. Plaintiffs allege that, in 2015, KHC “announced to shareholders a plan to eliminate $1.5 billion in cost saving by targeting redundancies and synergies” and “told investors that these efforts were a success and that Kraft Heinz was using the savings derived from eliminating waste to promote innovation and brand growth.” (Consol. Am. Class Action Compl. ¶ 1.) According to Plaintiffs, however, Defendants actually “implemented extreme and indiscriminate cost-cutting measures that decimated Kraft's supply-chain, alienated vendors, and drove away critically important customers.” (Id. at ¶ 2.) Plaintiffs allege that this ultimately culminated in KHC disclosing “a historic $15.4 billion write-down in the value of the Company's Oscar Mayer and Kraft trademarks and other intangible assets.” (Id. at ¶ 3.) Plaintiffs maintain that, following the write-down, “KHC's stock price plummeted by nearly 50%, causing massive losses to investors.” (Pls.’ Memo. at 13.)

Non-party PwC acted as KHC's independent auditor during the time period in question. Plaintiffs have issued a subpoena to PwC requesting that the firm produce, inter alia, electronically stored information pertaining to PwC's audit work for KHC and documents PwC turned over to the SEC in connection with the SEC's investigation of KHC. Several disputes have arisen between Plaintiffs and PwC concerning the scope of PwC's document production obligations, and they were not able to resolve their disputes through the required Local Rule 37.2 procedure. Plaintiffs now move for an order compelling PwC to comply with the subpoena and PwC cross-moves for an order quashing the subpoena.

Federal Rule of Civil Procedure 26 provides that “[p]arties 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.” Fed. R. Civ. P. 26(b)(1); see also Fed. R. Civ. P. 34; Fed. R. Civ. P. 37(a)(3)(B). “The party requesting discovery bears the initial burden of establishing its relevancy.” Eternity Mart, Inc. v. Nature's Sources, LLC, No. 19-cv-02436, 2019 U.S. Dist. LEXIS 198880, at *4 (N.D. Ill. Nov. 15, 2019) (citations omitted); see also Art Akiane LLC v. Art & SoulWorks, LLC, No. 19 C 2952, 2020 WL 6509228, at *3 (N.D. Ill. Nov. 5, 2020) (collecting cases). If the requesting party meets its burden, “the party opposing discovery has the burden of proving that the requested discovery should be disallowed.” Sols. Team v. Oak St. Health, MSO, LLC, No. 17 CV 1879, 2021 U.S. Dist. LEXIS 132847, at *7 (N.D. Ill. July 16, 2021) (citation omitted). Under Rule 45, “[a] party or attorney responsible for issuing and serving a subpoena must take reasonable steps to avoid imposing an undue burden or expense on a person subject to the subpoena.” Fed. R. Civ. P. 45(d)(1). The Court “must quash or modify a subpoena that ... subjects a person to undue burden.” Fed. R. Civ. P. 45(d)(3)(A)(iv).

*2 Through their motion, Plaintiffs seek an order compelling PwC to: “(1) search for and produce electronic documents responsive to Plaintiffs’ Subpoena, including emails or other electronic messages, and drafts of workpapers or other relevant documents; and (2) produce a copy of any subpoenas that the SEC served on PwC and the emails that PwC previously produced to the SEC in connection with the SEC's investigation.” (Pls.’ Memo. at 2.) On the flipside, PwC seeks an order quashing the subpoena to the extent it seeks these two categories of documents.[1]

Turning first to the second category of documents, as background, there was previously an SEC enforcement action against KHC, and PwC produced documents pursuant to subpoenas as part of the SEC's investigation. Plaintiffs maintain that “[t]he SEC's investigation regarding KHC's accounting fraud both overlaps with the underlying substance of this securities action and is fully subsumed by Plaintiffs’ allegations.” (Id. at 14.) As to Plaintiffs’ request for “the emails that PwC previously produced to the SEC,” PwC has indicated that it is willing to “produce its prior email production to the SEC.” (PwC's Resp. at 15.) Accordingly, that aspect of Plaintiffs’ motion to compel is denied as moot (though the Court expects PwC to produce any such e-mails forthwith if it has not yet done so). The parties’ remaining dispute on this topic concerns Plaintiffs’ request that PwC produce the actual subpoenas the firm received from the SEC. The Court agrees with Plaintiffs that the subpoenas the SEC served on PwC are relevant in that they reflect “the scope of the SEC's investigation and the facts and other information uncovered through this investigation.” (Pls.’ Memo. at 15.) For its part, PwC has not raised any specific arguments in its briefing explaining why it should not produce the subpoenas and has not identified any burden associated with producing the subpoenas. Accordingly, Plaintiffs’ motion to compel is granted to the extent it seeks production of the SEC subpoenas and PwC is ordered to produce any such subpoenas within 14 days of this Order. Correspondingly, PwC's motion to quash is denied to the extent it pertains to the SEC subpoenas.

The other aspect of Plaintiffs’ motion to compel concerns their request that PwC search for and produce custodial ESI. In support of their motion generally, Plaintiffs assert that “[i]n its role as KHC's independent public accountant, PwC audited, reviewed, and certified KHC's internal controls” and “performed audits and reviews of KHC's reporting of revenue and expenses” and further “assessed KHC's testing for goodwill and other intangible assets.” (Id. at 3.) Plaintiffs broadly claim that PwC's ESI is relevant in light of PwC's roles in that regard and assert that “the issues addressed as part of PwC's KHC engagements cover core aspects of Plaintiffs’ claims.” (Id. at 7.) With respect to Plaintiffs’ broad claims of relevance, the Court finds it crucial that PwC has already provided extensive discovery in this matter (and implicitly does not dispute that it possesses at least some relevant information).

Specifically, the record reflects that PwC has already produced nearly 5,000 responsive documents approaching nearly 40,000 pages of material. PwC states that “[t]hese materials span a half-decade and encompass 17 separate engagement files from PwC's audits and interim reviews of [KHC's] financial statements.” (PwC's Resp. at 1.) PwC further characterizes its document production as follows:

(Id.) PwC represents that it “has spent over 600 hours and incurred over $350,000 of expenses to date in responding to the Subpoena.” (Id. at 2.) In light of the extensive document productions PwC has already made and the substantial expenses it has already incurred, the Court finds that Plaintiffs’ broad claim of relevance as a basis for custodial ESI discovery is countervailed. See In re Honeywell Int'l, Inc. Sec. Litig., 230 F.R.D. 293, 301 (S.D.N.Y. 2003) (denying plaintiffs’ request for e-mails as overly broad in case where PwC acted as independent auditor and had already produced workpapers).

In raising more particularized arguments concerning ESI discovery, Plaintiffs primarily point to one of KHC's 28 affirmative defenses, which asserts that “Plaintiffs’ claims are barred, in whole or in part, because Kraft Heinz's management relied, in good faith, and was entitled to rely, on advice and information provided by Kraft Heinz's professional advisors, both within and outside Kraft Heinz.” [Doc. No. 326 at 221.] Plaintiffs assert that Defendants have “put PwC directly at issue by stating that they intend to rely on PwC and its ‘data, analysis, advice, reports, or conclusions’ to assert a good faith defense to Plaintiffs’ securities fraud claims.” (Pls.’ Memo. at 4.) However, the Court disagrees that KHC's affirmative defense entitles Plaintiffs to custodial ESI discovery from PwC.

To the extent Plaintiffs’ request for custodial ESI encompasses electronic communications between PwC and KHC, the Court finds that Plaintiffs are not entitled to that information via their subpoena to PwC because the information can more appropriately be obtained directly from KHC, a party to this action. See Little v. JB Pritzker for Governor, No. 18 C 6954, 2020 WL 1939358, at *2 (N.D. Ill. Apr. 22, 2020) (court may limit discovery “if it determines that the requested documents can be obtained from a more convenient or less burdensome source, the requesting party had an opportunity to obtain the information through the normal discovery process, or the information sought is cumulative or duplicative of other discovery”). Along those lines, the Court agrees with PwC that “to the extent there are emails reflecting ‘advice and information’ from PwC to KHC, the Company, a party to this litigation, would also be in possession of such materials.” (PwC's Resp. at 8-9 (emphasis removed).) See Ameritox, Ltd. v. Millennium Labs, Inc., No. 12-CV-7493, 2012 WL 6568226, at *3 (N.D. Ill. Dec. 14, 2012) (quashing subpoena where information was “certainly more readily available” from a party to the litigation). Accordingly, Plaintiffs’ motion to compel is denied to the extent it seeks custodial ESI and electronic communications between PwC and KHC. Correspondingly, PwC's motion to quash that aspect of the subpoena is granted.

Plaintiffs also seek PwC's “internal” ESI. Plaintiffs argue that PwC's internal communications are relevant because they: may “document[ ] the discussions and decision-making that formed the basis for the conclusions expressed in the workpapers that PwC has produced to Plaintiffs” (Pls.’ Memo. at 2); may “reflect[ ] information or representations that KHC provided to PwC” (id. at 8); may “reflect[ ] any difficulties that PwC had in obtaining the information it needed or any concerns about the reliability or veracity of the information that KHC provided” (id.); and may reflect advice PwC provided “informally and orally to KHC” (id. at 9). The Court finds that these bases of relevance are flimsy and also encompass information available from other sources. First, PwC has already produced its final workpapers and the exact relevance of the discussions that went into the workpapers is unclear. Second, KHC – a party – would be in possession of the information KHC provided to PwC. Third, the notion that PwC had difficulties in obtaining information from KHC is speculative at best. And fourth, KHC – a party – was privy to any informal advice it received from PwC and thus necessarily possesses discoverable information on that topic.

*4 The tenuous relevance of PwC's internal ESI and the fact that the assertedly relevant information is available from another source leads the Court to the claims of burden raised by PwC. PwC represents that, based on the search terms Plaintiffs have proposed, “PwC would need to review an additional 90,388 documents comprising approximately 406,000 pages of information and 9,000 spreadsheets.” (PwC's Resp. at 11 (emphasis removed).) PwC further states that “[s]uch an undertaking would require over 2,400 attorney hours and result in an additional $330,000 to $400,000 of expense.” (Id. (emphasis removed).)[2] So, PwC has set forth a substantial burden that would arise if the firm was required to produce custodial ESI. Under the circumstances of this case, the Court agrees with PwC that “even if PwC's internal emails were to contain kernels of marginally relevant information, Plaintiffs’ demand would impose a burden that far outweighs any incremental benefit.” (Id. at 2.) See United States v. Amerigroup Illinois, Inc., No. 02 C 6074, 2005 WL 3111972, at *7 (N.D. Ill. Oct. 21, 2005) (“But even if it be conceded that the emails are ‘potentially germane’ to that defense, the significant and undue burden on HFS [a non-party] precludes production.”). Ultimately, while also considering the extensive productions PwC has already made, the Court finds that the burden and expense of Plaintiffs’ proposed internal custodial ESI discovery outweighs its likely benefit. See Fed. R. Civ. P. 26(b)(1). Accordingly, Plaintiffs’ motion to compel is denied to the extent it seeks PwC's internal ESI, and PwC's motion to quash that aspect of the subpoena is granted.

For the foregoing reasons, Plaintiffs’ motion to compel [Doc. No. 406] is granted in part and denied in part and PwC's motion to quash [Doc. No. 419] is granted in part and denied in part as specified herein.

SO ORDERED.

ENTERED: