Action Ink, Inc. v. Anheuser-Busch Inc.
ORDER AND REASONS denying 75 MOTION for APPEAL OF MAGISTRATE JUDGE DECISION to District Court. Signed by Chief Judge Sarah S. Vance on 12/20/12. (Copy to Mag 2) (jjs, )
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
ACTION INK, INC.
ORDER AND REASONS
Before the Court is plaintiff Action Ink, Inc.’s motion to
review the order issued by Magistrate Judge Wilkinson on October
31, 2012.1 The Order granted in part and denied in part
plaintiff’s motion to compel the Rule 30(b)(6) deposition of
defendant, Anheuser-Busch, Inc.2 Because the Court finds that the
Magistrate Judge’s Order was neither clearly erroneous nor
contrary to law, the Court DENIES plaintiff’s motion.
This suit arises out of defendant Anheuser-Busch’s alleged
infringement of plaintiff Action Ink’s trademark “The Ultimate
Fan.” After defendant failed to designate Rule 30(b)(6)
representatives to testify on a number of topics identified by
plaintiff, plaintiff filed a motion to compel the 30(b)(6)
depositions. Magistrate Judge Wilkinson denied plaintiff’s motion
R. Doc. 59.
R. Doc. 41
on several of the topics, finding them to be so broadly worded
that they included information irrelevant to plaintiff’s claim
concerning its trademark.3 Magistrate Judge Wilkinson granted in
part and denied in part plaintiff’s motion as to other topics,
permitting the subjects but narrowing their scope. Plaintiff now
seeks review of the Magistrate Judge’s denial or denial in part
of eight topics, in addition to the denial of an award of
attorneys’ fees or costs incurred in connection with the motion
Federal law affords a magistrate judge broad discretion in
the resolution of non-dispositive discovery disputes. See Fed. R.
Civ. P. 72(a); 28 U.S.C. § 636(b)(1)(A). If a party is
dissatisfied with a magistrate judge's ruling, it may appeal to
the district judge, who may reconsider the ruling and reverse it
“where it has been shown that the magistrate judge's order is
clearly erroneous or contrary to law.” Id.; Fed. R. Civ. P.
72(a); see also Castillo v. Frank, 70 F.3d 382, 385 (5th Cir.
1995). A finding is clearly erroneous when a reviewing court is
“left with the definite and firm conviction that a mistake has
been committed.” United States v. Stevens, 487 F.3d 232, 240 (5th
R. Doc. 59.
Cir. 2007) (quoting United States v. U.S. Gypsum Co., 333 U.S.
364, 395 (1948)).
Under the Federal Rules of Civil Procedure, “[p]arties may
obtain discovery regarding any nonprivileged matter that is
relevant to any party's claim or defense.” Fed. R. Civ. P.
26(b)(1). Plaintiff first challenges the Magistrate Judge’s
determination that the topics of trademark licenses between
defendant and third parties, royalty revenues received from those
licenses, and other trademark infringement claims against
defendant are overly broad and include information that is not
relevant to plaintiff’s claim.
Plaintiff asserts that to prove the value of a trademark
license for “The Ultimate Fan,” it would be helpful to review
defendant’s licenses with third parties not involved in the suit.
Plaintiff cites a case in which the calculation of a reasonable
royalty rate involved a comparison of the proposed rate and the
rates of other licenses. See Sands, Taylor & Wood v. Quaker Oats
Co., 34 F.3d 1340, 1343 (7th Cir. 1994). But, in Sands, the
Seventh Circuit Court of Appeals had previously determined that
the trial court calculated incorrectly the plaintiff’s monetary
award, and thus it required the trial court to establish a
baseline reasonable royalty to determine the appropriate award.
Further, the trial court then estimated a royalty rate based
on the plaintiff’s prior licenses and policies, since the
defendant refused to disclose its prior licenses. Id. at 1343-44.
Therefore, the case does not support plaintiff’s contention that
defendant’s prior licenses with other companies are necessarily
relevant to the royalties for plaintiff’s trademark, particularly
given the case-by-case nature of a determination of relevance.
Plaintiff’s desire to address unrelated trademark infringement
claims against defendant is another exceptionally broad request
for information that appears to have minimal relevance to the
dispute here. In light of the extent to which these topics would
expand the scope of the 30(b)(6) depositions, the Court does not
find the Magistrate Judge’s Order denying inclusion of these
topics to be clearly erroneous or contrary to law.
The Court also finds that plaintiff has not demonstrated
that reversal of the Magistrate Order is warranted on the topic
of defendant’s defenses. Magistrate Judge Wilkinson held that
plaintiff’s request for “facts” related to certain legal defenses
asserted by defendant fails to “describe with reasonable
particularity the matters for examination”.5 See Fed. R. Civ. P.
30(b)(6). Plaintiff is entitled to inquire about the defenses
asserted by defendant, namely laches, acquiescence, estoppel,
abandonment, fraud, unclean hands, and trademark misuse. But,
R. Doc. 59.
given that plaintiff vaguely requests “facts” related to these
defenses, the Court does not find that Magistrate Judge Wilkinson
was mistaken in his determination that plaintiff’s request lacks
Plaintiff also seeks reversal of the Order’s partial denial
of four other topics identified by plaintiff. Magistrate Judge
Wilkinson granted plaintiff’s motion to compel deposition
testimony on the topics but limited the scope of the subject
matter to the trademark at issue. Thus, the Order stated that the
topic of defendant’s “negotiation of the license agreement with
the NFL . . . particularly any indemnification for trademark
infringement claims and oversight of marketing campaigns that
would include ‘The Ultimate Fan’ promotions,” was overly broad.6
Magistrate Judge Wilkinson allowed the topic but limited it to
negotiations concerning the use of “The Ultimate Fan.”7
Similarly, Magistrate Judge Wilkinson narrowed plaintiff’s
request for testimony on defendant’s marketing plans from 20062012 to marketing on the “The Ultimate Fan” trademark
specifically.8 Magistrate Judge Wilkinson also limited the motion
to compel related to defendant’s beer sales to beer sales and
R. Doc. 59.
profits for defendant’s products “as to which the Ultimate Fan
promotion was run.”9 Lastly, Magistrate Judge Wilkinson denied
plaintiff’s request for information on defendant’s communications
with advertising agencies about “The Ultimate Fan” promotions but
granted the motion to compel deposition testimony on
communications concerning “plaintiff’s assertion of trademark
rights in ‘The Ultimate Fan’”.10
The Court does not find that the Magistrate Judge’s partial
denial of plaintiff’s motion to compel and narrowing of the
proposed topics are clearly erroneous or contrary to law. Within
the topics proposed, Magistrate Judge Wilkinson allowed plaintiff
to seek information concerning its specific trademark, thereby
ensuring that the Rule 30(b)(6) depositions would address the
topics that plaintiff found relevant without including overly
broad information of questionable relevance. Plaintiff’s requests
would expand the scope of the deposition topics to a potentially
unmanageable degree, and plaintiff has not demonstrated the
relevance of such broad topics other than to contend that the
information would be helpful for comparison purposes.
Therefore, the Court finds that the Order’s denial of
plaintiff’s motion to compel deposition testimony on defendant’s
R. Doc. 59.
overall business, rather than its actions related to “The
Ultimate Fan” trademark does not merit reversal. Further, given
Magistrate Judge Wilkinson’s partial grant and partial denial of
plaintiff’s motion, the Court finds that his determination that
each party should bear its own attorneys’ fees and expenses is
neither clearly erroneous nor contrary to law.
For the foregoing reasons, the Court DENIES plaintiff’s
motion to reverse the Magistrate Judge’s Order issued on October
New Orleans, Louisiana, this 20th day of December, 2012.
SARAH S. VANCE
UNITED STATES DISTRICT JUDGE