Opinion
Case No. 2:04-CV-879 TC.
June 9, 2005
ORDER GRANTING MOTION TO AUTHORIZE PRODUCTION
Defendant Coastline Financial, Inc., (Coastline) is a landlord who claims to hold a landlord's lien on a former tenant's personal property. Plaintiffs Host American Corporation and Globalnet (collectively "Host") claim to own that personal property.
Defendants' Opposition to Plaintiffs' Motion for Partial Summary Judgment and Memorandum in Support of Cross Motion for Partial Summary Judgment (Coastline's Summary Judgment Memo) ¶¶ 1 and 19 at 3 and 5, docket no. 32, filed December 6, 2004.
Host contracted with the tenant for the tenant to build electrical equipment according to Host's specifications. Host owns patent and other rights in the equipment and apparently supplied some of the parts to build the equipment. Host claims to have paid for the equipment in advance, and to have owned the parts and equipment while in the tenant's possession, while Defendant Coastline (the landlord) claims Host loaned money to the tenant, and was only a creditor in those goods. Thus, Coastline claims its landlord's lien and claim for unpaid rent is prior to any interest of Host.
Memorandum in Support of Motion for Partial Summary Judgment (Host's Summary Judgment Memo) ¶ 2 at 2, docket no. 24, filed October 26, 2004. This paragraph was not disputed by Coastline's Summary Judgment Memo at 6.
Host's Summary Judgment Memo ¶ 3 at 2. This paragraph was not disputed by Coastline's Summary Judgment Memo at 6.
Host's Summary Judgment Memo ¶ 3 at 2. Coastline's Summary Judgment Memo ¶ 11 at 4.
Host's Summary Judgment Memo ¶¶ 4-7 at 2-3.
Coastline's Summary Judgment Memo at 1.
Host's Summary Judgment Memo at 5; Coastline's Summary Judgment Memo at 2.
Defendant Coastline moved to authorize production of documents from a witness who testified pursuant to a subpoena duces tecum. The witness is a former employee of the tenant, and apparently had some of the tenant's records in her possession. At the deposition, she initially agreed to let Coastline copy the documents and disk, but after strong objections by Host's counsel, she declined. Host claims the materials are its intellectual property, provided to the tenant to enable it to build equipment for Host. Coastline filed this motion to adjudicate its right to the documents under the subpoena.
Docket no. 65, filed April 29, 2005.
Attached as Exhibit B to Memorandum in Support of Motion for Authorization to Produce Documents and for Sanctions (Coastline's Memorandum to Compel), docket no, 66, filed April 29, 2005.
Deposition of Tracy Bailey, pages 26-27attached to Coastline's Memorandum to Compel as Exhibit B and Memorandum in Opposition to Motion for Motion for Authorization to Produce Documents and for Sanctions (Host's Memorandum in Opposition), docket no, 70, filed May 10, 2005.
Host's Memorandum in Opposition at 4.
Coastline claims the records include:
a. A brown folder marked ENS-FanSaver with purchase orders, cost model, quotes by part number, lists of vendors and lead times, business cards and literature on the equipment;
b. A brown folder marked ENS which included purchase orders, cost models, quotes, board layouts, change orders, engineering orders, e-mails, bills of materials, waivers of specification of process, and general notes; and
c. A green folder related to ENS vendor costs, which included a business plan, income and expense reports, notes and spreadsheets.
Coastline's Memorandum to Compel at 2.
The witness's identification of the documents is slightly different. She said the brown folder marked ENS-Fan Saver contains "a customer purchase order," "a disk with the cost model," "hard copies of the cost model," quotes "broken down by part number," a list of "who the vendors are, what the minimums [order quantities] are, what the lead times are," and "business cards and literature." The brown folder marked ENS contains purchase orders, "cost models," "quotes in hard copy and on disk, "change orders, engineering orders," and "various e-mails back and forth," including "waivers of specification of process." The third folder, which is green, contains "a business plan," "income and expense reports," and notes and spreadsheets.
Deposition of Tracy Bailey page 92, line 6.
Id. line 8.
Id. lines 15-18.
Id. lines 20-22, line 25 through page 93 line 2.
Id. page 92, lines 24-25.
Id. lines 6 and 7.
Id. page 93, line 13.
Id. line 15.
Id. lines 17-18.
Id. lines 23 through page 94, line 5.
Id. page 93, lines 8-23.
Host argues that the deponent was not in lawful custody of the records and thus should not be able to turn them over. The cases cited by Host do not support the proposition that a subpoena cannot compel production of materials from a person in possession without legal authority. In those cases, the person subpoenaed did not possess the documents, and the courts rejected the argument that the person should be compelled to obtain and produce documents to which the person had no legal access.
Host's Memorandum in Opposition at 2.
Cochran Consulting, Inc. v. Uwatec USA, Inc., 102 F.3d 1224 (Fed. Cir. 1996) (stating alleged infringers did not own, possess, or control code); Searock v. Stripling, 736 F.2d 650, 652 (11th Cir. 1984) (Party "had done his best to comply with the discovery requests, but had been unable to produce invoices and receipts of which he currently did not have a copy."); Estate of Young Through Young v. Holmes, 134 F.R.D. 291, 293 (D.Nev. 1991) ("Plaintiff does not have possession or custody of the articles."); Burton Mechanical Contractors, Inc. v. Foreman, 148 F.R.D. 230, 236 (N.D.Ind. 1992) (Party "is not in possession or control, and does not have the legal right to obtain the other documents.").
Host claims that the "files contained proprietary and customer information unique" to Plaintiffs. Host argues that the records are not relevant because they deal with the nature of the technology and profitability. If the documents are indeed Host's technology, that may bear on Host's claims. The magistrate judge cannot say that the items identified are not "relevant to the claim or defense of any party." Entry of a protective order to prevent dissemination of any protected technology would be appropriate. The Rules permit a protective order to be imposed when a motion to compel is granted in part.
Host's Memorandum in Opposition at 2 and 5.
Id. at 4.
It does not appear that a protective order appears in the docket.
IT IS HEREBY ORDERED that the motion is GRANTED. The materials in the possession of Tracey Bailey may be produced to Coastline, and Coastline shall make copies for Host.
Docket no. 65, filed April 29, 2005.
Protective Order
IT IS FURTHER ORDERED that none of the materials in the possession of Tracey Bailey shall be provided to persons other than (a) outside counsel of record for the parties in this action, and the partners, associates, secretaries, paralegal assistants, and employees of such counsel to the extent reasonably necessary to render professional services in the action relating to the subject matter of those records; (b) expert witnesses involved in this litigation who are reasonably in need of access to such records; and (c) such other persons as may be permitted to have access such information by further order of the court or stipulation of all parties. Notwithstanding the foregoing, no person shall have access to these records or copies until that person has executed an agreement to abide by the terms of this Order and be subject to the jurisdiction of this court for purposes of enforcement of this Order. Any such documents used as an exhibit to a deposition or any papers filed with the court, and any such document used as an exhibit in this court shall be designated as under seal and any testimony regarding such documents or their contents shall be designated as under seal.
At the conclusion of this action, including through all appeals, all records protected by this order shall be returned to Plaintiff's counsel or destroyed and the person possessing such records shall certify to such destruction or return. Such return or destruction shall not relieve said parties or persons from any of the continuing obligations imposed upon them by this Order. After the termination of this action, the Court will continue to have jurisdiction to enforce this Order.
This Order is without prejudice to any party's right to assert at any time that any particular information or document is or is not subject to privilege, discovery, production or admissibility.