Opinion
For Fox Broadcasting Company, Twentieth Century Fox Film Corporation, Fox Television Holdings Inc, Plaintiffs: Amy M Gallegos, Andrew Jackson Thomas, David R Singer, Richard Lee Stone, Jenner and Block LLP, Los Angeles, CA USA.
For Netflix, Inc., Amazon.Com Inc., Movants: Bobbie J Wilson, Brian Patrick Hennessy, LEAD ATTORNEYS, Anahit Samarjian, Perkins Coie LLP, San Francisco, CA USA.
For Dish Network Llc, Defendant: Jeremiah J Burke, LEAD ATTORNEY, Coblentz Patch Duffy and Bass LLP, San Francisco, CA USA; Annette L Hurst, William A Molinski, Orrick Herrington and Sutcliffe LLP, San Francisco, CA USA; E Joshua Rosenkranz, Elyse D Echtman, Lisa T Simpson, Peter A Bicks, PRO HAC VICE, Orrick Herrington and Sutcliffe LLP, New York, N.Y. USA; Mark Alan Lemley, Michael H Page, Durie Tangri LLP, San Francisco, CA USA; Susan K Jamison, Coblentz Patch Duffy and Bass LLP, San Francisco, CA USA.
For Dish Network Corporation, Defendant: Annette L Hurst, Orrick Herrington and Sutcliffe LLP, San Francisco, CA USA; E Joshua Rosenkranz, Elyse D Echtman, Lisa T Simpson, Peter A Bicks, PRO HAC VICE, Orrick Herrington and Sutcliffe LLP, New York, N.Y. USA; Mark Alan Lemley, Michael H Page, Durie Tangri LLP, San Francisco, CA USA; William A Molinski, Orrick Herrington and Sutcliffe LLP, Los Angeles, CA USA.
For Echostar Technologies Llc, Defendant: Annette L Hurst, LEAD ATTORNEY, Orrick, Herrington & Sutcliffe, LLP, San Francisco, CA USA; William A Molinski, LEAD ATTORNEY, Orrick Herrington and Sutcliffe LLP, Los Angeles, CA USA; E Joshua Rosenkranz, Elyse D Echtman, Lisa T Simpson, Peter A Bicks, PRO HAC VICE, Orrick Herrington and Sutcliffe LLP, New York, N.Y. USA; Mark Alan Lemley, Michael H Page, Durie Tangri LLP, San Francisco, CA USA.
For Nbcuniversal Media, Llc, Objector: Jean P Nogues, Patricia H Benson, Robert H Rotstein, LEAD ATTORNEYS, Mitchell Silberberg and Knupp LLP, Los Angeles, CA USA.
For Abc, Inc., American Broadcasting Companies, Inc., Objectors: Michael M Kowsari, Stephen Gerard Larson, Arent Fox LLP, Los Angeles, CA USA.
Honorable DOLLY M. GEE, UNITED STATES DISTRICT JUDGE.
Proceedings: ORDER RE: DEFENDANTS' MOTION FOR REVIEW OF MAGISTRATE JUDGE'S ORDER DENYING DEFENDANTS' MOTION TO COMPEL PRODUCTION OF DOCUMENTS AND GRANTING NONPARTIES' PROTECTIVE ORDER [Doc. # 399]
On August 11, 2014, Honorable Stephen J. Hillman, United States Magistrate Judge, issued an Order (" Order") denying Defendants DISH Network LLC's (" DISH") Motions to Compel Production of Documents and Granting Non-Parties Amazon.com, Inc. (" Amazon") and Netflix, Inc.'s (" Netflix") Motion for a Protective Order. [Doc. # 357.] On August 28, 2014, DISH filed a Motion for Review of Judge Hillman's Order (" Aug. 28 Motion") requesting that the Court (1) sustain its objections to Judge Hillman's Order denying its motions to compel and (2) reverse the Order granting Amazon and Netflix's motion for a protective order. [Doc. # 399.] On October 3, 2014, this Court issued an order seeking clarification from Fox regarding DISH's Aug. 28 Motion. [Doc. # 486.] On October 9, 2014, Fox filed a response to the order seeking clarification. [Doc. # 546.] On January 12, 2015, this Court issued an Order regarding the parties' motions for summary judgment. (" MSJ Order.") [Doc. # 600.]
For the reasons set forth below, DISH's motion is DENIED and Judge Hillman's Order is AFFIRMED.
I .
FACTUAL BACKGROUND
DISH requests that the Court overrule the portions of Magistrate Judge Hillman's Order pertaining to:
o Request for Production No. 3 (Set One), seeking production of all of Plaintiff Fox's Retransmission Consent (" RTC") Agreements with other multichannel video programming distributors (" MVPDs")
Request for Production No. 3 (Set One) sought other affiliate agreements, but here DISH seeks review only of the part of the Order denying its Motion to Compel Production of the RTC agreements with other MVPDs.
o Request for Production Nos. 32, 35-41 (Set Three), seeking production of documents reflecting program views and revenues earned by Fox on Fox.com, Hulu, Netflix, TV.com, Amazon, Vudu, Apple iTunes, and Cinema Now for the last five television seasons; and
o The Protective Order requested by Non-Parties Netflix and Amazon. (Aug. 28 Motion at 3.)
II .
STANDARD OF REVIEW
A district court reviewing a magistrate judge's ruling on nondispositive matters will set aside the magistrate judge's orders only if that order is " clearly erroneous" or " contrary to law." Fed.R.Civ.P. 72(a); accord 28 U.S.C. § 636(b)(1)(A); see also United States v. Abonce-Barrera, 257 F.3d 959, 969 (9th Cir. 2001) (" [T]he magistrate judge's decision in . . . nondispositive matters is entitled to great deference by the district court.").
The Court is not entitled to overturn a factual finding simply because it is convinced that it would have reached a different result. Anderson v. City of Bessemer City, 470 U.S. 564, 573, 105 S.Ct. 1504, 84 L.Ed.2d 518 (1985). The Supreme Court has held that a factual finding by the magistrate judge is " clearly erroneous" only when the reviewing court is " left with the definite and firm conviction that a mistake has been committed." United States v. Hinkson, 585 F.3d 1247, 1260 (9th Cir. 2009) ( en banc) (quoting United States v. U.S. Gypsum Co., 333 U.S. 364, 395, 68 S.Ct. 525, 92 L.Ed. 746 (1948)) (internal quotation marks omitted).
The standard for review of a magistrate judge's decision regarding the relevance of evidence is " abuse of discretion." Folb v. Motion Picture Indus. Pension & Health Plans, 16 F.Supp.2d 1164, 1168 n. 2 (C.D. Cal. 1998) aff'd sub nom. Folb v. Motion Picture Indus. Pension & Health Plans, 216 F.3d 1082 (9th Cir. 2000); see also Geophysical Sys. Corp. v. Raytheon Co., Inc., 117 F.R.D. 646, 647 (C.D. Cal. 1987). A judge abuses his discretion " only when his decision is based on an erroneous conclusion of law or where the record contains no evidence on which he rationally could have based that decision." Premium Serv. Corp. v. Sperry & Hutchinson Co., 511 F.2d 225, 229 (9th Cir.1975). When a magistrate judge " deals with discovery issues, specifically with striking an appropriate balance between relevancy and burden and expense, it reflects the Magistrate's exercise of discretion rather than his application of rigid rules of law." Indep. Petrochemical Corp. v. Aetna Cas. & Sur. Co., No. CIV. A. 83-3347, 1987 WL 8512, *1 (D.D.C. Mar. 9, 1987).
In contrast, when reviewing a magistrate judge's legal conclusions, a district court applies the " contrary to law" standard, and reviews such conclusions de novo. See China Nat. Metal Products Import/Export Co. v. Apex Digital, Inc., 155 F.Supp.2d 1174, 1177 (C.D. Cal. 2001).
III .
DISCUSSION
A. Denial of Motions to Compel
Magistrate Judge Hillman ruled that DISH was not entitled to the documents sought in Request for Production No. 3 (Set One) or Request for Production Nos. 32, 35-41 (Set Three), as the documents were not sufficiently relevant to justify the burden of production. Order at 9, 12. DISH argues that Judge Hillman's decision was " clearly erroneous" because it relied on the allegedly mistaken assumption that Fox had already produced aggregate responsive viewership and revenue data, incorrectly concluded that the demanded information was irrelevant to the issue of fair use, and incorrectly concluded that the MVPD agreements' terms were irrelevant and unnecessary. Aug. 28 Motion at 1-2.
In his Order, Judge Hillman noted the wide range of discovery that Fox had already produced regarding its revenues, viewing information, licensing agreements, and other financial information. Order at 5. He considered Fox's assertion that producing the requested documents would be unduly burdensome, as it would require the production of 1900 agreements, consuming hundreds of hours and costing tens to hundreds of thousands of dollars. Id. at 4, 8. He also observed that Fox is willing to stipulate that only the agreements produced are relevant to its market-harm claims. Id. at 5.
Judge Hillman found that DISH's economist failed to sufficiently address why Fox's financial records, which have already been supplied to DISH, do not provide adequate data for market analysis or to demonstrate whether DISH's unique features caused Fox's revenues to decrease. Id. at 6. Judge Hillman found that the economist's statements regarding the need for these documents were conclusory and did not convince him that the documents were necessary to conduct market harm, reasonable royalty, and irreparable harm analysis. Id.
In his Order, Judge Hillman also noted that Fox is not seeking actual damages, but a reasonable royalty based on the value of the rights which DISH infringed if Fox were compelled to license those rights to DISH. Id. at 8. He then concluded that " licenses dissimilar in subject matter or scope to those at issue are irrelevant to the assessment of a reasonable royalty." Id. Moreover, to the extent Fox is seeking statutory damages under the Copyright Act, " it is not required to produce evidence of its profits from the works being infringed." Id. at 9. In a similar vein, Judge Hillman considered the request for program views of Fox's primetime programming via online services and determined that the data was not sufficiently probative to outweigh the burden of production. Id. at 12.
Additionally, in light of this Court's MSJ Order, the only remaining damages claims are for reasonable royalties. See MSJ Order at 55-59. Detailed information regarding Fox's revenues is not relevant to the calculation of these damages.
In sum, Judge Hillman did not abuse his discretion in determining that the documents requested were not sufficiently probative to justify the burden of producing them. There is ample evidence in the record on which Judge Hillman was able to rationally base his decision, and a magistrate judge has broad authority to " strik[e] an appropriate balance between relevancy and burden and expense, " as Judge Hillman did here. Indep. Petrochemical Corp., Id. at *1. The fact that DISH disagrees with Judge Hillman's assessment of the probative value of the evidence weighed against the burden of producing it does not make his decision " clearly erroneous."
B. Grant of Protective Order
DISH also argues that Magistrate Judge Hillman committed legal error by granting the Non-Parties' Motion for a Protective Order where they were not directly served with a discovery request. Aug. 28 Motion at 8.
It is well established, however, that " [t]he court has broad authority to control discovery and fashion protective orders." United States v. Columbia Broad. Sys., Inc. (" Columbia"), 666 F.2d 364, 368-69 (9th Cir. 1982); see also Roberts v. Legacy Meridian Park Hosp., Inc., 299 F.R.D. 669, 672 (D. Or. 2014), citing Seattle Times Co. v. Rhinehart, 467 U.S. 20, 36, 104 S.Ct. 2199, 81 L.Ed.2d 17 (1984) (" Rule 26(c) confers 'broad discretion on the trial court to decide when a protective order is appropriate and what degree of protection is required.'")
" [A] court may be as inventive as the necessities of a particular case require in order to achieve the benign purposes of the rule." Columbia, 666 F.2d at 369. Courts have noted that " [g]ranting protective orders to non-parties to protect their trade secrets and confidential commercial information does not offend the public interest in disclosure." In re Northshore Univ. Healthsystem, 254 F.R.D. 338, 343 (N.D.Ill. 2008). " Ultimately, " [t]he grant and nature of protection is singularly within the discretion of the . . . court." John Wiley & Sons, Inc. v. Book Dog Books, LLC, 298 F.R.D. 184, 187 (S.D.N.Y. 2014) citing Dove v. A. Capital Corp., 963 F.2d 15, 19 (2d Cir.1992) (citation omitted).
Trial courts have wide latitude to organize discovery and fashion protective orders as they see fit. While the language of Federal Rule of Civil Procedure 26 states that " [a] party or any person from whom discovery is sought may move for a protective order, " it also states that " [t]he court may, for good cause, issue an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense." Fed.R.Civ.P. 26(c). The first clause of Rule 26(c) gives a party or a person from whom discovery is sought the right to move for a protective order. The second clause gives the Court discretion, for good cause, to permit a " party or person" to seek a protective order.
Here, Amazon and Netflix sought leave to file a motion for a protective order and Magistrate Judge Hillman granted them leave to do so. See Non-Parties Netflix and Amazon's Letter to the Honorable Judge Stephen J. Hillman [Doc. # 260-1]; Order Granting Non-Parties Netflix and Amazon's Joint Application to File Under Seal [Doc. # 241.] Magistrate Judge Hillman's decision to grant the Non-Parties' Protective Order is not contrary to law.
IV .
CONCLUSION
In light of the foregoing, Magistrate Judge Hillman's September 11, 2014 Order to deny Defendant's Motions to Compel Production and grant Non-Parties' Motion for Protective Order is AFFIRMED.
IT IS SO ORDERED.