ALLISON CLAIRE, Magistrate Judge.
This matter is before the court on separate motions regarding damages discovery brought by plaintiff and by defendant (ECF Nos. 120 and 121), a motion to compel by plaintiff (ECF No. 104), and a motion to quash by plaintiff (ECF No. 119). These discovery motions were referred to the undersigned pursuant to E.D. Cal. R. 302(c)(1). The parties attended a hearing on March 13, 2019 at 10:00 a.m. All motions are DENIED, and the court will temporarily stay discovery regarding damages.
Plaintiff filed its original complaint on September 21, 2016. On October 24, 2016, defendant filed a motion to dismiss that is currently under submission before Judge Nunley. ECF No. 5. A protective order is in place to govern the confidentiality of certain materials to be exchanged during discovery. ECF Nos. 32, 34. Defendant filed an answer and counterclaims on December 14, 2018. ECF No. 96. Plaintiff filed a motion to amend its complaint on January 3, 2019. ECF No. 102. That motion is pending before the District Judge in this case. Because of the pending motion for leave to amend, no scheduling order has been issued and there are no pending discovery deadlines.
Plaintiff filed the instant motions to compel on January 18, 2019 and February 19, 2019. ECF Nos. 104, 120. Plaintiff filed the instant motion to quash on February 19, 2019. ECF No. 119. The Joint Statements for all three motions were filed on March 6, 2019. ECF Nos. 125, 126, 127 (respectively). Defendant filed a motion for a protective order regarding damages discovery on March 3, 2016. ECF No. 121. The hearing on that motion was advanced to be heard concurrently with the other filed discovery motions. ECF No. 129. Plaintiff also filed notices of requests to seal documents pursuant to Local Rule 141 in support of its motion to quash and motion to compel. ECF Nos. 115, 124. The requests were granted. ECF No. 128, 130. At the March 13, 2019 hearing, defense counsel indicated defendant's intent to file in the near future a motion to bifurcate the liability and damages portions of this case, at least as to discovery. Because bifurcation of discovery will necessarily impact the scheduling of dispositive motions and trial, it is a matter properly decided by the District Judge.
The court's prior order on plaintiff's motion for a protective order provides the relevant factual background:
ECF No. 32 at 1-2.
Four separate discovery motion are before the court. Plaintiff brings a motion to compel damages related discovery (ECF No. 120) and defendant brings a motion for protective order regarding damages related discovery (ECF No. 121). Plaintiff also brings a motion to compel production as to several document requests (ECF No. 104), and a motion to quash a third-party subpoena (ECF No. 119). Each motion is addressed below, with the two motions regarding damages discovery addressed together.
"Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense . . . Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence." Fed. R. Civ. P. 26(b)(1). Federal Rules 33 and 34 provide that discovery requests must be responded to within 30 (or in some cases 45) days.
The issue of damages discovery presents, at this juncture, a case management challenge as opposed to a substantive discovery dispute. Upon review of the docket and the parties' arguments, the undersigned finds that the most prudent course of action is to issue a temporary STAY of damages discovery, which will be automatically lifted upon the entry of a scheduling order in this case.
A temporary stay of damages related discovery is appropriate for several reasons. First, defendant represents that it intends to file a motion to bifurcate liability and damages discovery (ECF No. 126 at 7), and confirmed at hearing that this motion will be filed in the very near future. Such a motion must be directed to the District Judge, because it implicates the structure of the scheduling order that he will issue in due course. Second, the pendency of plaintiff's motion to amend (ECF No. 102) and motion to strike (ECF No. 103) demonstrate that the contours of this case (and thus the appropriate scope of damages discovery) is currently unsettled. Third, there is no scheduling order issued in force because of the pending substantive motions. Accordingly, resolution of the discovery motions regarding damages would be premature. How to proceed with such discovery is a determination best made when it is clear what claims, counter-claims and defenses frame the matters at issue in this case. The complete absence of a discovery cutoff date means that neither party will be prejudiced by a temporary stay of damages related discovery.
At hearing, there was discussion of a time-based temporary stay. A time-based temporary stay is not appropriate here, because the need for a stay is based on the open issues as to the scope of the case and the case schedule. The undersigned therefore orders a temporary stay of damages related discovery until the entry of a scheduling order in this case, at which point the stay will automatically lift. In light of this ruling, both plaintiff and defendant's motions (ECF Nos. 120 and 121) are DENIED as MOOT.
Plaintiff seeks to compel production regarding several requests for production. ECF No. 125. The court finds that each request is either moot, premature, or lacking merit, and thus DENIES the motion. Each category of documents sought is addressed independently below.
Plaintiff contends that defendant must produce its list of OEM drawings which have been scanned on Aerometals' server. ECF No. 125 at 3. Plaintiff maintains that Aerometals has previously provided false representations that it did not maintain such a list and could not produce drawings because they were on fragile, original paper.
Aerometals counters that the allegation of misrepresentation is baseless because no false testimony was provided: the list at issue is not a central list of all OEM drawings in its possession, but a partial and incomplete list generated over ten years ago that does not appear to pertain to drawings in Aerometals' possession. ECF No. 125 at 6. Further, defendant argues that theis issue arose in the context of plaintiff's motion to compel information regarding the
In sum, the court finds defendant's argument on this matter persuasive. At issue in this case is defendant's use of the OEM drawings, which plaintiff has in its possession as part of the FAA packages. It is not at all clear that there was malfeasance regarding defendant's representations as to the exitance of the partial list, and sanctions are not warranted. Plaintiff is capable of comparing the partial list to the FAA packages to determine which documents on the partial list were submitted to the FAA. As to source identification, the court maintains its previous limitation: defendant's duty to identify OEM drawing sources is limited to documents that came into its possession within 10 years prior to the filing of this lawsuit. ECF No. 63 at 12. Plaintiff's motion on this point is DENIED.
Plaintiff contends that Aerometals failed to comply with the Court's May 15, 2017 order to produce its PMA and STC submissions to the FAA. ECF No. 125 at 8, ECF No. 63 at 10. Aerometals contends that it did complete production as of January 31, 2019. ECF No. 129 at 10. In light of the fact that defendant has completed the production at issue, this matter is moot and the motion on this point must be denied. There are no discovery deadlines pending in this case and plaintiff cannot show any prejudice based on the length of time taken for production. This is particularly so in light of the complex docket in this case, which demonstrates that despite the fact that the case was filed in September of 2016 (ECF No. 1), the basic structure of this action is still very much in flux. For example, defendant's Answer and Counterclaim was not filed until December 14, 2019 (ECF No. 96), and plaintiff filed a motion for leave to amend its complaint on January 3, 2019 (ECF No. 102) and a motion to strike defendant's counterclaim on January 4, 2019 (ECF No. 103). The motion to amend and motion to strike are still under submission before the District Judge. There is no discovery deadline in place. Because defendant has made the production at issue and there is no harm from any delay, plaintiff's motion on this point must be denied.
Plaintiff alleges that it has discovered its own trade secret materials in defendant's document production, and that defendant has refused to comply with plaintiff's request to designate these materials as Highly Confidential under Sections 6.2 and 6.3 of the Protective Order entered in this case. ECF No. 125 at 12. Defendant argues, among other things, that plaintiff's position reflects a fundamental misunderstanding of the Protective Order, which permits a receiving party to challenge "a designation of confidentiality" made by the designating party with respect to documents produced by the designating party in discovery.
Defendant is clearly correct on this point. The protective order in this case, ECF No. 33, contains a procedure for challenging a designation of confidentiality; there is no process for challenging a party's decision
Plaintiff moves to compel further production as to several document requests, including: (1) Request for Production of Documents Set 2, RFP No. 12; and (2) Request for Production of Documents Set 3, RFP Nos. 2, 3, 45, 6, 7, 8 and 9. Defendant's position with respect to each of these requests, with the exception of Set 3, RFP 2, is the same: the process of production is ongoing, and a supplemental document production was to take place on March 8, 2019. ECF No. S125 at 17-25. The production as to Set 3, RFP 2 was completed as of February 27, 2019.
Plaintiff seeks to quash a Rule 45 subpoena issued by defendant to non-party The Boeing Company ("Boeing"), which would require Boeing to produce certain documents related to arbitration proceedings between plaintiff and Boeing arising from an Asset Acquisition Agreement ("AAA") and Cross License. ECF Nos. 119, 127 at 2. The dispute between Boeing and plaintiff, which is ongoing in parallel arbitration and federal litigation, addresses ownership of intellectual property regarding parts for use in military aircraft, but which defendant asserts are common to products involved in the litigation at bar. ECF No. 127 at 14. Plaintiff asserts that the litigation with Boeing is solely related to military helicopters and is entirely irrelevant to the litigation at bar. ECF No. 127 at 10. Plaintiff argues that the subpoena should be quashed because (1) it invades attorney work-product doctrine; (2) some documents at issue have already been produced by plaintiff or could be obtained from plaintiff; (3) the documents are not relevant; and (4) the subpoena seeks plaintiff's confidential information. ECF No. 127 at 4.
A nonparty may be compelled to produce documents and tangible things via a Rule 45 subpoena. Fed. R. Civ. P. 34(c). Rule 45 permits a party to issue a "subpoena commanding the person to whom it is directed to attend and give testimony or to produce and permit inspection of designated records or things." Fed. R. Civ. P. 45(a)(1)(C). The recipient may object to a subpoena, or move to quash or modify it. Fed. R. Civ. P. 45(c)(2), 45(c)(3). "The district court has wide discretion in controlling discovery" and "will not be overturned unless there is a clear abuse of discretion."
Fed. R. Civ. P. 45(c)(3)(A). Additionally, the issuing court
Fed. R. Civ. P. 45(c)(3)(B).
The Ninth Circuit has "yet to address the question of whether a party has standing to bring a motion to quash since usually only the subpoenaed non-party may move to quash. The general rule, however, is that a party has no standing to quash a subpoena served upon a third party, except as to claims of privilege relating to the documents being sought".
The only ground for the motion that plaintiff has standing to pursue is the work product argument, to which the court now turns. The motion is denied for lack of standing as to all other asserted grounds.
"The work product doctrine, codified in Federal Rule of Civil Procedure 26(b)(3), protects from discovery documents and tangible things prepared by a party or his representative in anticipation of litigation."
"The work product doctrine affords a qualified protection from discovery for all trial preparation materials prepared "in anticipation of litigation."
When a party withholds information otherwise discoverable by claiming that the information is protected by the work product doctrine, the party must "(i) expressly make the claim; and (ii) describe the nature of the documents, communications, or tangible things not produced or disclosed—and do so in a manner that, without revealing information itself privileged or protected, will enable other parties to assess the claim." Fed. R. Civ. P. 26(b)(5)(A). "An existing privilege exemption from discovery must be raised in a proper fashion to be effective in justifying a refusal to provide discovery. Failure to assert the privilege objection correctly can mean that the privilege is waived." 8 Fed. Prac. & Proc. Civ. § 2016.1 (3d ed.). The party asserting the protection has the burden of proving its application.
In this case, any attorney work product protection has been waived. Although work-product protection is not automatically waived by production to third parties, "[i]f a document otherwise protected by work-product immunity is disclosed to others with an actual intention, or reasonable probability, that an opposing party may see the document, the party who made the disclosure cannot subsequently claim work-product immunity."
Plaintiff's argument that the documents were disclosed in the context of a private arbitration, and thus with the understanding that they would not be disclosed to the outside world, is a red herring. Plaintiff cites no caselaw that supports this argument. Plaintiff's citation to
The work product doctrine is not concerned with the general secrecy of documents; it exists specifically to protect attorney work product prepared in anticipation of litigation from falling into the hands of an opposing party. These allegedly work-product documents have already been disclosed to an opposing party in the context of litigation; any applicable work-product protection is waived.
Plaintiff asserts that the subpoena to Boeing must be quashed because of the sensitive nature of the documents at issue, which were disclosed with the understanding of confidentiality in the context of private arbitration. ECF No. 127 at 10. The cursory argument made by plaintiff on this point betrays its futility. As discussed above, there is a standing protective order in this case that already addresses confidentiality concerns such as the one raised here. ECF No. 33 and 34. Plaintiff's argument on this point is rejected.
The court hereby ORDERS as follows:
IT IS SO ORDERD.