Opinion
CV-19-05760-PHX-SMB
10-14-2022
Kelli Salazar, et al., Plaintiffs, v. Driver Provider Phoenix LLC, et al., Defendants.
ORDER
Honorable Susan M. Brnovich, United States District Judge
Pending before the Court is Defendants' Motion to Quash Subpoena (“MQS”) (Doc. 270) that Plaintiffs issued to Hello! Arizona Destination Management, Inc. (“Hello! Arizona”). (See Doc. 270-1 at 3-15.) The Motion is fully briefed (Docs. 285, 297), and therefore the Court declines Plaintiffs' request for oral argument as it would be unnecessary. See LRCiv 7.2(f) (“The Court may decide motions without oral argument.”). Having considered the parties' arguments and the relevant rules and caselaw, the Court will deny the MQS for the reasons explained below.
I. BACKGROUND
On May 5, 2022, Defendants received Plaintiffs' notice of intent to serve a subpoena on Hello! Arizona, a third-party with no involvement in this case. (Doc. 270 at 2.) Plaintiffs sought Hello! Arizona to do the following by June 6, 2022:
No. 1
Produce documents and electronically stored information sufficient to show the percentage markup charged to customers of Hello! Arizona for the transportation services provided to such customers by the Driver Provider from December 6, 2016 to present.
Produce a copy of all contracts between HELLO! ARIZONA DESTINATION MANAGEMENT, INC and any Defendant or other entity that operates or operated as The Driver Provider from December 6, 2016 to the present.(Doc. 270-1 at 4, 15.)
On May 19, 2022, Defendants filed the MQS. (Doc. 285 at 2.) Plaintiffs assert Defendants did not meet and confer before filing the MQS, as required by Local Rule 7.2(j) and the Court's Case Management Order. (Id.) Therefore, Plaintiffs allege they requested that Defendants withdraw the MQS and first meet those requirements. (Id. at 3.) Defendants withdrew the MQS on May 27, 2022. (Id.) The parties then met and conferred but failed to reach an agreement. (Id.)
But “[t]o allow the parties time to follow the procedures set forth in the Case Management Order, Plaintiffs agreed that they would not oppose any objections or eventual motion filed by Defendants on timeliness grounds, provided the parties notified the Court of the dispute within the time required to respond to the subpoenas at issue.” (Id.) On June 2, 2022, the parties submitted summaries of multiple discovery disputes to the Court. (Id.) Because the Court indicated that a discovery dispute hearing would occur on June 8, 2022-two days after the subpoena's response deadline-Defendants refiled the MQS on June 2, 2022 to preserve their objections. (Doc. 297 at 3.) Defendants' objections included: (1) the subpoena “impose[s] an undue burden on Hello! Arizona because it seeks irrelevant information”; (2) the subpoena is overbroad; and (3) the subpoena seeks “confidential commercial information of Hello! Arizona and the private information of Hello! Arizona customers.” (Doc. 270 at 5.) Plaintiffs argue: (1) Defendants violated the Case Management Order; (2) Defendants lack standing to object on Hello! Arizona's behalf; and (3) the subpoena seeks relevant information, is narrowly tailored, and is not unduly burdensome. (Doc. 285 at 2-10.) In an Order issued after the discovery dispute, the Court noted it would rule on this issue “by separate order.” (Doc. 280.) This is that order.
II. LEGAL STANDARDS
Federal Rule of Civil Procedure 45(d)(3)(A) states that “[o]n timely motion, the court for the district where compliance is required must quash or modify a subpoena that . . . (iii) requires disclosure of privileged or other protected matter, if no exception or waiver applies; or (iv) subjects a person to undue burden.” Moreover, “[t]o protect a person subject to or affected by a subpoena, the court for the district where compliance is required may, on motion, quash or modify the subpoena if it requires . . . disclosing a trade secret or other confidential research, development, or commercial information.” Fed.R.Civ.P. 45(d)(3)(B).
“Ordinarily, only the party served with a subpoena has standing to move to quash it.” Oyenik v. Corizon Health Inc., No. CV-13-01597-PHX-SPL(BSB), 2014 WL 12787872, at *1 (D. Ariz. Nov. 20, 2014). “A party has standing to challenge a subpoena served on another entity only if the party can show it has a personal right or privilege regarding the subject matter of the subpoena.” Blotzerv. L-3 Commc'ns Corp., 287 F.R.D. 507, 509 (D. Ariz. 2012). This includes confidential research, development, or commercial information, but the objecting party must show their own information is at risk, not merely the third party's information. See Wells Fargo & Co. v. ABD Ins., No. C 12-03856-PJH(DMR), 2012 WL 6115612, at *3 (N.D. Cal. Dec. 10, 2012).
A party can also show a personal right or privilege through “information which could expose the moving party to annoyance, embarrassment, oppression, or undue burden or expense.” Firetrace USA, LLC v. Jesclard, No. CV-07-2001-PHX-ROS, 2008 WL 5146691, at *2 (D. Ariz. Dec. 8, 2008) (cleaned up). However, a party's objection that the third-party subpoena “seeks irrelevant information or imposes an undue burden on the nonparty are not grounds on which a party has standing to move to quash a subpoena issued to a non-party.” G.K. Las Vegas Ltd. P'ship v. Simon Prop. Grp., Inc., No. 2:04-CV-01199-DAE-GWF, 2007 WL 119148, at *3 (D. Nev. Jan 9, 2007).
II. DISCUSSION
A. Standing
Defendants lack standing to raise their objections. First, Defendants cannot object to the subpoena's relevancy, or any undue burden placed upon Hello! Arizona. See Miller v. York Risk Servs. Grp., 2:13-CV-1419 JWS, 2015 WL 11120710, at *1 (D. Ariz. Feb. 12, 2015) (“[A] party lacks standing to challenge a third-party subpoena on the grounds of relevancy or undue burden imposed on the non-party when the non-party has not objected.”). Defendants also fail to articulate a personal right or privilege regarding the information sought. See Blotzer, 287 F.R.D. at 509. Lastly, the Court does not find that Plaintiffs' subpoena was issued to cause Defendants' embarrassment, annoyance, and oppression with a non-party customer. See Jesclard, 2008 WL 5146691, at *2. But even if the Court did find standing, though it does not, the Court would still deny the MQS for the reasons described below.
B. Plaintiffs' Subpoena
1. First Request
Plaintiffs' first request that Hello! Arizona produce the percentage markup charged to its customers for services provided by Driver Provider from December 6, 2016 to the present. Plaintiffs seek this information in response to Defendants' affirmative defense under Section 7(i) of the Fair Labor Standards Act, which is limited in part to employees of a “retail or service establishment” that have more than half of their “compensation for a representative period (not less than one month) representing] commissions on goods or services.” 29 U.S.C. § 207(i); see also 29 C.F.R. § 779.312 (defining retail or service establishment as “an establishment 75 per centum of whose annual dollar volume of sales of goods or services (or of both) is not for resale and is recognized as retail sales or services in the particular industry”); 29 C.F.R. § 779.328 (distinguishing retail sales from wholesale sales).
Plaintiffs argues that the information from Hello! Arizona is relevant to show that Driver Provider doesn't qualify for the 7(i) exemption because its revenues are derived from wholesale services and not retail. Defendants asks this Court to decide the exemption applies and then find the information sought is irrelevant. The Court will not do so as a motion to quash is not the place to seek a ruling on the merits of an issue. Here, the Court finds the subpoena seeks relevant information to inform Plaintiffs on the scope and merits of Defendants' Section 7(i) affirmative defense. Defendants argue the December 6, 2016 to present production period represents a scope that would “far exceed the parameters of discoverable information in the lawsuit because it encompasses a period of almost five and a half years,” and was likewise designed to expose Defendants to annoyance, embarrassment, and oppression with a non-party customer. (Doc. 497 at 4, 7.) See Jesclard, 2008 WL 5146691, at *2. However, Hello! Arizona did not object to the subpoena, and Defendants did not explain why the breadth of the time period is inappropriate or how it could be modified under Fed.R.Civ.P. 45(d)(3)(A). As such, the Court denies Defendants' MQS as to this request.
2. Second Request
Plaintiffs' second request would require Hello! Arizona to produce copies of every contract it held with Defendants from December 6, 2016 to the present. Plaintiffs already requested this information from Defendants but were informed no contracts exist. (Doc. 270 at 10-11, Doc. 285 at 6.) Because Defendants already responded to this request, they argue that it would impose an undue burden with a customer who is not a party to this litigation. See Jesclard, 2008 WL 5146691, at *2. However, Plaintiff points out that they should not have to rely on Defendant's avowal that no contract exists because Defendant previously denied possessing documents, but then found them after a third party was subpoenaed. (Doc. 285 at 7 n.4.) The Court agrees and will deny Defendants' MQS as to this request.
IV. CONCLUSION
Accordingly, IT IS ORDERED that Defendants' MQS is denied. (Doc. 270.)