Viacom International Inc. et al v. YouTube, Inc. et al

Filing 21

Memorandum in Opposition re 1 MOTION to Compel Respondents' Opposition to Plaintiffs' Joint Motion to Compel Production of Documents Pursuant to Subpoenas to Artis Capital Management L.P., Sequoia Capital Operations LLC and TriplePoint Capital LLC filed byArtis Capital Management, L.P., Sequoia Capital Operations LLC, TriplePoint Capital LLC. (Rubin, Michael) (Filed on 7/21/2008)

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Viacom International Inc. et al v. YouTube, Inc. et al Doc. 21 1 DAVID H. KRAMER, State Bar No. 168452, dkramer@wsgr.com MICHAEL H. RUBIN, State Bar No. 214636, mrubin@wsgr.com 2 WILSON SONSINI GOODRICH & ROSATI Professional Corporation 3 650 Page Mill Road Palo Alto, CA 94304-1050 4 Telephone: (650) 493-9300 Facsimile: (650) 565-5100 5 Attorneys for Nonparty Respondents 6 Artis Capital Management, L.P., Sequoia Capital Operations LLC and 7 TriplePoint Capital LLC 8 9 10 11 12 13 14 15 16 17 18 19 20 THE FOOTBALL ASSOCATION PREMIER LEAGUE LIMITED, ET AL., 21 Plaintiffs, 22 v. 23 YOUTUBE, INC., ET AL. 24 Defendants. 25 26 27 28 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION VIACOM INTERNATIONAL INC., ET AL. Plaintiffs, v. YOUTUBE, INC., ET AL. Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO PLAINTIFFS' JOINT MOTION TO COMPEL PRODUCTION OF DOCUMENTS PURSUANT TO SUBPOENAS TO ARTIS CAPITAL MANAGEMENT L.P., SEQUOIA CAPITAL OPERATIONS LLC, AND TRIPLEPOINT CAPITAL LLC DATE: August 15, 2008 TIME: 9:00 a.m. JUDGE: Hon. Susan Illston RESPONDENTS' OPPOSITION TO MOTION TO COMPEL CASE NO.: 3:08-MC-80129-SI Dockets.Justia.com 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 III. 23 24 25 26 27 28 C. D. E. B. TABLE OF CONTENTS Page PRELIMINARY STATEMENT.....................................................................................................1 FACTUAL BACKGROUND ......................................................................................................... 4 A. The Underlying Litigation...................................................................................................4 1. 2. YouTube's Operations, Influence, and Commitment to Copyright Protection.......4 Plaintiffs' Suits and the Digital Millennium Copyright Act ................................... 6 The Non-Parties...................................................................................................................7 1. 2. 3. Artis and Its Investment in YouTube ...................................................................... 7 TriplePoint and Its Equipment Loan and Lease to YouTube..................................8 Sequoia and Its Investment in YouTube ................................................................. 8 The Subpoenas and the Meet and Confer Process .............................................................. 9 The Matters Actually in Dispute ....................................................................................... 10 The Burden on the Non-Parties ......................................................................................... 11 ARGUMENT ................................................................................................................................ 12 I. II. Relevant Standards ............................................................................................................ 12 Plaintiffs' Subpoena Requests Seek Documents That Should Be Obtained From Defendants YouTube And Google To The Extent They Are Relevant At All ................. 13 A. B. Plaintiffs Should Not be Permitted to Seek from Third Parties Materials that are by Definition in the Possession of their Litigation Adversaries......................13 Internal Analyses Generated by the Non-Parties are Irrelevant to Plaintiffs' Litigation Against Google and YouTube .............................................................. 15 Request Numbers 8, 19, 20, and 21 Are Invalid for Additional Reasons ......................... 16 A. B. C. D. Plaintiffs' Time Period Instruction Is Grossly Overbroad and Seeks Irrelevant Information ........................................................................................... 16 Request Number 8 Is Overbroad and Seeks Irrelevant Information Regarding Potential Investments in YouTube ...................................................... 17 Request Numbers 19, 20, and 21 Are Overbroad and Seek Irrelevant Information Regarding Google's Acquisition of YouTube .................................. 18 Requiring Further Search and Review Would Impose an Undue Burden ............ 19 i CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 1 IV. 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Any Production by the Non-Parties Must Be Governed by a Suitable Protective Order Entered by this Court .............................................................................................. 21 CONCLUSION ............................................................................................................................. 22 RESPONDENTS' OPPOSITION TO MOTION TO COMPEL ii CASE NO.: 3:08-MC-80129-SI 1 2 3 TABLE OF AUTHORITIES Page CASES 4 Beinin v. Ctr for the Study of Popular Culture, C06-2298, 2007 WL 832962 (N.D. Cal. Mar. 16, 2007) .................................................. 12 5 Braxton v. Farmer's Ins. Group, 209 F.R.D. 651 (N.D. Ala. 2002)......................................................................................15 6 7 Dart Indus. Co. v. Westwood Chem. Co., 649 F.2d 646 (9th Cir. 1980).............................................................................................12 8 Dibel v. Jenny Craig, Inc., No. 06 CV 2533, 2007 WL 2220987 (S.D. Cal. Aug.1, 2007) ......................................... 14 9 10 E.E.O.C. v. Lexus Serramonte, 237 F.R.D. 220 (N.D. Cal. 2006) ...................................................................................... 14 11 Exxon Shipping Co. v. U.S. Dept. of Interior, 34 F.3d 774 (9th Cir. 1994)...............................................................................................12 12 13 Harris v. Wells, No. B-89-391, 1990 WL 150445 (D. Conn. Sept. 5, 1990) .............................................. 14 14 Haworth, Inc. v. Herman Miller, Inc., 998 F.2d 975 (Fed. Cir. 1993) ........................................................................................... 14 15 16 Katz v. Batavia Marine & Sporting Supplies, Inc., 984 F.2d 422 (Fed. Cir. 1993) ........................................................................................... 12 17 Moon v. SCP Pool Corp., 232 F.R.D. 633 (C.D. Cal. 2005) ...................................................................................... 14 18 19 Night Hawk Ltd. v. Briarpatch Ltd, L.P., No. 03 CIV 1382, 2003 WL 23018833 (S.D.N.Y. Dec. 23, 2003) ................................... 12 20 Perfect 10, Inc., v. CCBILL LLC, 488 F.3d 1102 (9th Cir. 2007).............................................................................................6 21 22 Visto Corp. v. Smartner Info. Sys., Ltd., Nos. 06-80339 and 06-80352, 2007 WL 218771 (N.D. Cal. Jan. 29, 2007) .............. 15, 16 23 STATUTES 24 17 U.S.C. 512(c)...........................................................................................................................6 25 17 U.S.C. 512(m) .......................................................................................................................... 5 26 RULES 27 Fed. R. Civ. P. 26(b)(2).................................................................................................................12 28 Fed. R. Civ. P. 26(b)(2)(c) ............................................................................................................ 13 CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO MOTION TO COMPEL iii 1 Fed. R. Civ. P. 45(a)......................................................................................................................12 2 Fed. R. Civ. P. 45(a)(2)(C)............................................................................................................21 3 Fed. R. Civ. P. 45(c)(1) ................................................................................................................. 13 4 Fed. R. Civ. P. 45(c)(3)(A)............................................................................................................13 5 Fed. R. Civ. P. 45(c)(3)(B)............................................................................................................13 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 RESPONDENTS' OPPOSITION TO MOTION TO COMPEL iv CASE NO.: 3:08-MC-80129-SI 1 2 PRELIMINARY STATEMENT Plaintiffs' Motion to Compel ("Motion") non-party discovery from non-party 3 Respondents Artis Capital Management L.P. ("Artis"), Sequoia Capital Operations LLC 4 ("Sequoia"), and TriplePoint Capital LLC ("TriplePoint") (collectively, the "Non-Parties"), is 5 heavy on rhetoric and overgeneralizations, but thin on substance and facts. 6 Two of the Non-Parties are venture capital firms that provided early seed money to 7 YouTube Inc. ("YouTube"), a site that would go on to become the leading user-generated video 8 service on the Internet, growing faster than any other online service in history. The other non9 party here, TriplePoint, is a debt and equipment financier who provided early equipment 10 financing to YouTube. 11 After sitting by and watching YouTube grow exponentially for over a year, Plaintiffs 12 brought copyright infringement claims against YouTube and Google Inc. ("Google") in the 13 Southern District of New York seeking a windfall in damages. In the coordinated actions, 14 Plaintiffs allege that YouTube should be held responsible for the infringing activities of users 15 who upload materials to the service without appropriate authorization. Through their claims, 16 Plaintiffs seek to eviscerate the Digital Millennium Copyright Act ("DMCA"), the legislative 17 compromise Congress struck in 1998 to shield online services in precisely these circumstances. 18 Artis, Sequoia and TriplePoint do not warrant so much as a mention in Plaintiffs' 19 Complaints. That is not surprising, as, contrary to the story Plaintiffs concoct in their Motion, 20 the Non-Parties' involvement with YouTube was quite limited. Artis was an entirely passive 21 investor, and had no role at all in the company's operations. TriplePoint merely provided 22 financing for YouTube to lease equipment in exchange for stock warrants, and likewise had no 23 involvement. While Sequoia selected an individual to sit on the YouTube board, the venture 24 fund's connection with the company lasted only a year and ended long ago. Despite these 25 indisputable facts, early in the case, Plaintiffs served each of the Non-Parties with grossly 26 overbroad and burdensome subpoenas (the "Subpoenas"). The Subpoenas mirror Requests for 27 Production ("RFPs") that had already been served on Defendants YouTube and Google; indeed, 28 15 of the 24 Subpoena categories are identical to RFPs served on Defendants. RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 1 CASE NO.: 3:08-MC-80129-SI 1 Plaintiffs took no steps with their subpoenas to avoid imposing undue burden or expense 2 on the Non-Parties. While the Non-Parties could have simply refused to produce documents, 3 they instead engaged in extensive, arduous negotiations with Plaintiffs over a nearly seven4 month period, during which the Non-Parties attempted to rehabilitate Plaintiffs' demands. 5 Through that process, in the interests of compromise and the avoidance of motion practice, the 6 Non-Parties agreed to produce a significant volume of documents tied to their involvement with 7 YouTube. Declaration of Scott Wilkens in Support of Plaintiffs Joint Motion to Compel 8 ("Wilkens Decl."), Exhs. DD, EE, FF, GG, HH, KK, WW. At Plaintiffs' insistence, the Non9 Parties long ago conducted time-consuming and burdensome searches for these materials and are 10 prepared to produce (or already have produced) them. 11 Plaintiffs' Motion obscures the fact of the Non-Parties' good faith negotiations and their 12 agreement on most of discovery Plaintiffs demanded. In this respect, Plaintiffs' Motion is 13 aggressive and unreasonable as their original Subpoenas. After all this time and effort, Plaintiffs 14 cannot take the concessions they obtained and ignore the concessions they made. Such tactics 15 are unreasonable, all the more so in the context of non-party discovery. 16 In point of fact, while the Subpoenas each contain 24 Requests, the only issues that were 17 not resolved during the conference process are: (i) an objection to Plaintiffs' overbroad time 18 period for the Subpoenas; (ii) a partial objection to Request Number 8; and (iii) objections to 1 19 Request Numbers 19, 20, 21. With respect to these issues, no further production should be 2 20 compelled. 21 On the question of relevant time periods, Plaintiffs' demand that the Non-Parties produce 22 documents spanning nearly five years is excessive. Although YouTube was founded in February 23 2005, Plaintiffs seek documents extending back more than a year earlier, to January 2004. On 24 the other end of the spectrum, Plaintiffs demand documents extending all the way to today, more 25 Assuming that Plaintiffs will abide by (or be held to) their agreements and in the 26 interests of avoiding a recitation of seven months of negotiations, the Non-Parties do not brief their objections to demands where agreement was ultimately reached between them. Compare 27 Motion at 15-19. If any of those Requests truly remain in dispute in light of the prior agreements, the Non-Parties request the opportunity to brief them separately. 28 2 As described infra at Factual Background Section D, in a further effort to limit the instant dispute, the Non-Parties withdraw their partial objection to Request Number 5. CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 2 1 1 than a year and half after the Non-Parties' respective investments with (and connection to) 2 YouTube came to an end. The burden associated with searching through an additional two and 3 half years worth of documents, in some cases stored only back up tapes, far outweighs the 4 potential relevance of documents Plaintiffs speculate might exist somewhere in that haystack. 5 The Non-Parties have already agreed to produce significant volumes of documents dating from 6 YouTube's founding--in all cases many months before their investments--to the date those 7 investments ended. That nearly two-year period is the relevant timeframe here and Plaintiffs are 8 overreaching in their effort to more than double it. 9 It is equally improper for Plaintiffs to demand that the Non-Parties produce all 10 information they received from YouTube or Google (apparently regardless of subject matter), 11 when Plaintiffs can seek all such information directly from the Defendants in the first instance. 12 Indeed, the parties to the litigation and the presiding Court are in a considerably better position to 13 evaluate the legitimacy and breadth of such requests. As a matter of law, Plaintiffs should not be 14 burdening non-parties with demands for discovery that they could easily obtain from their 15 litigation adversaries. That is all the more true here, as Plaintiffs have made no showing at all 16 that the information they demand is not available from the Defendants. 17 Plaintiffs' demand for the Non-Parties' internal analyses of YouTube is even more 18 misguided. Plaintiffs apparently hope that the Non-Parties at some point themselves analyzed 19 YouTube's potential liability for copyright infringement. But even if they had, such analyses by 20 non-parties would be wholly irrelevant. The Non-Parties' internal discussions, if any, about 21 hypothetical liability would in no way inform the question of the Defendant's actual liability. 22 Even if Plaintiffs' demands were justified in the abstract, any relevance the documents 23 might have is easily outweighed by the significant burden that production would impose on the 24 Non-Parties if they were obligated to go back and search again for responsive documents. The 25 Non-Parties have already expended considerable time and resources searching for and reviewing 26 their files in response to Plaintiffs' demands. They should not now be made to repeat that 27 burdensome process. 28 RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 3 CASE NO.: 3:08-MC-80129-SI 1 Finally--and contrary to Plaintiffs' assertions--any production should be governed by a 2 suitable protective order entered by this Court, not the New York court in the underlying 3 litigation. The Non-Parties and their documents are located in California, the Subpoenas were 4 issued out of this Court, and this Court has now been called upon to enforce aspects of the 5 Subpoenas. It is this Court that should be the one to address the related issues concerning terms 6 of production and enforcement of those terms. The Non-Parties should not have to bear the 7 expense and burden of going to a New York court to enforce the terms of a protective order--an 8 entirely possible scenario given that Plaintiffs have already been found to have violated the New 9 York protective order. 10 11 A. 12 FACTUAL BACKGROUND The Underlying Litigation Plaintiffs filed this miscellaneous action concerning discovery in two underlying 13 copyright cases pending in the United States District Court for the Southern District of New 14 York. Throughout their brief, Plaintiffs purport to describe the issues in that litigation, offering 15 skewed assertions about YouTube, Google and the Non-Parties. While Plaintiffs' advocacy is 16 generally irrelevant to the issues presented by this Motion (and although Defendants are in the 17 best position to respond to Plaintiffs' assertions), a more balanced presentation of the underlying 18 case may assist the Court. 19 20 1. YouTube's Operations, Influence, and Commitment to Copyright Protection YouTube provides a free online platform that allows any individual to upload videos and 21 allow them to be viewed by tens of millions of people around the world. An individual user 22 creates a free account and then, without YouTube's participation, selects files to be uploaded to 23 YouTube that can be viewed by anyone with an Internet connection. Again without YouTube's 24 participation, the individual user determines what videos to post and selects the title and keywords 25 that are assigned to each clip to identify and help others find it. 26 27 28 RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 4 CASE NO.: 3:08-MC-80129-SI 1 Since its founding in 2005, YouTube has become the fastest growing site in the history of 3 2 the Internet and a social phenomenon. Just a few examples illustrate YouTube's unique role in 3 politics, culture, and education: 4 5 6 7 8 9 10 11 12 In 2007, the Democratic and Republican Parties held separate debates in which their candidates for President faced questions not from professional journalists, but from ordinary Americans who posted their videos on YouTube. Major universities around the world have posted videos of lectures and classes on YouTube, allowing anyone with an Internet connection free access to college-level instruction in a variety of subjects, from physics to Shakespeare; the videos uploaded by the University of California at Berkeley alone have received over 1.4 million views to date. Last year, Queen Elizabeth II posted her annual Christmas message on YouTube, allowing her to reach a worldwide audience in a way never before possible.4 While YouTube is mindful of the possibility that its users may upload video clips to the 13 service that they do not have the right to share, YouTube simply cannot monitor or control the 14 staggering volume of material uploaded each day. The sheer magnitude of the task renders such 15 monitoring impossible. More importantly, a third party reviewer looking at a video, could not 16 determine: (1) whether the content of that video is subject to copyright protection in the first place; 17 (2) who the copyright owner is; (3) whether the person or entity posting the material is the 18 copyright holder; (4) whether that owner has licensed the content to others to post or view, either 19 expressly, or impliedly by allowing it remain available after learning about it; or (5) whether the 20 posting of that video is otherwise permitted by law, for example, by the doctrine of fair use. In 21 recognition of these practical limitations, Congress explicitly relieved online service providers of 22 monitoring or investigative obligations when enacting the DMCA. See 17 U.S.C. 512(m) 23 (service providers' immunity from copyright infringement claims shall not be conditioned on "a 24 See, e.g., YouTube's video boom `a social phenomenon,' San Francisco Chronicle Online, Oct. 10, 2006 (at http://www.sfgate.com/cgi26 bin/article.cgi?f=/c/a/2006/10/10/MNG54LLVSO1.DTL&feed=rss.news). 25 See YouTube video debate actually worked, CNET News.com, July 23, 2007 (http://www.news.com/YouTube-video-debate-actually-worked/2100-1028_3-6198405.html); 28 Thanks to YouTube, Professors Are Finding New Audiences, Chronicle of Higher Education, Jan. 9, 2008 (http://chronicle.com/free/2008/01/1159n.htm); Queen posts holiday speech on YouTube, National Post Online (http://www.nationalpost.com/news/Story.html?id=197497). 27 RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 4 3 5 CASE NO.: 3:08-MC-80129-SI 1 service provider monitoring its service or affirmatively seeking facts indicating infringing 2 activity"). Instead, "[t]he DMCA notification procedures place the burden of policing copyright 3 infringement--identifying the potentially infringing material and adequately documenting 4 infringement--squarely on the owners of the copyright." Perfect 10, Inc., v. CCBILL LLC, 5 488 F.3d 1102, 1113 (9th Cir. 2007). Accordingly, YouTube relies on information it receives 6 from copyright owners regarding allegedly unauthorized material posted to its site. And whenever 7 it receives an appropriate notice of an allegedly infringing video clip, YouTube expeditiously 5 8 disables access to the disputed clip. 9 10 2. Plaintiffs' Suits and the Digital Millennium Copyright Act Plaintiffs, the alleged creators and owners of various copyrighted video content, filed two 11 separate lawsuits in New York, on March 13 and May 4, 2007, respectively. Plaintiffs allege that 12 YouTube and Google (based on its acquisition of YouTube in November 2006) are liable for 13 direct, contributory, and vicarious copyright infringement based on material uploaded to the 14 YouTube service by users. Wilkens Decl. Exhs. M, N. 15 Plaintiffs' suits seek to undermine the legislative compromise embodied in the DMCA. 16 Congress enacted the DMCA in 1998 in an effort to encourage the development of online services 17 by affording them immunity against a variety of copyright infringement claims. The DMCA 18 creates a "safe harbor" for service providers like YouTube, which store, at the direction of their 19 users, material on their systems that may infringe a third party's copyrights. 17 U.S.C. 512(c). 20 In return, service providers must act promptly upon receipt of notices of alleged infringement from 21 It is worth mention that YouTube has led the online industry in developing measures to 22 help copyright owners identify and prevent the unauthorized use of their content online. By way of example only, YouTube: (1) requires its users to agree to terms that expressly prohibit 23 uploading material that the user is not authorized to post; (2) repeatedly warns users who are uploading a clip that they must have the rights to do so and provides a "Copyright Tips" page to 24 help users determine whether their upload is permissible; (3) does not generally permit the uploading of clips longer than 10 minutes, which prevents users from posting longer-running 25 copyrighted content, such as television shows and feature films; (4) has created a Content Verification Program that allows copyright owners to flag disputed videos and request their 26 removal with the click of a button; (5) terminates the accounts of users who repeatedly violate the company's copyright policies and removes from the site all videos posted by such users; and (6) 27 automatically blocks users from posting video clips that previously have been taken down for violating the company's copyright policies. In addition, YouTube has rolled-out a groundbreaking 28 technological solution (known as the "YouTube Video ID System") that assists participating copyright holders in identifying their content on YouTube's service and allows them prospectively to determine where and how that content can appear, if at all. CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 6 5 1 copyright holders to remove disputed materials from their service. In this way, the statute 2 balances the interests of copyright owners and online services. Today, countless online services, 3 ranging from Amazon, eBay, Facebook, and MySpace, to Plaintiffs' own services like iFilms and 4 MTV.com, rely upon (and perhaps owe their existence to) the DMCA. 5 B. 6 The Non-Parties Plaintiffs describe the Non-Parties as "venture capital firms that made early-stage 7 investments" in YouTube. Motion at 2, 4. Plaintiffs' Motion is devoid of virtually any specific 8 information about Artis and TriplePoint. Instead, in broad brushstrokes, Plaintiffs paint all three 9 of the Non-Parties monolithically, as having "privileged" access to YouTube-related information 10 and "privileged" influence over YouTube's management--to the point of allegedly controlling 11 YouTube or acting as YouTube's agent. Motion at 4, 23. This is simply false. 12 13 1. Artis and Its Investment in YouTube In March 2006, Artis invested in YouTube during its Series B round of financing. 14 Declaration of David Lamond in Support of Respondents' Opposition to Plaintiffs' Joint Motion 15 to Compel Production of Documents Pursuant to Subpoenas ("Lamond Decl.") 4. From the 16 beginning of its investment, Artis maintained the role that it typically does in its investments: as 17 a strictly passive investor. Id. at 5. Pursuant to the financing agreement, Artis received 18 periodic reports from YouTube about YouTube's financial and business progress, but that 19 information was no different from what any passive investor would normally receive in the 20 course of its investment. Id. at 6. Artis exercised no control over, and never participated in, 21 the strategic planning or development of YouTube's business model or day-to-day operational 22 management. Id. at 7. There is no reason why Plaintiffs cannot obtain from YouTube all of the 23 information that Artis itself received from YouTube. See infra at Argument, Section II. 24 Artis played no more active a role in Google's acquisition of YouTube. As a YouTube 25 shareholder, Artis was asked to approve the merger agreement. Lamond Decl. 7. Other than 26 voting on the merger--which Artis did alongside other investors and based on the 27 recommendation of YouTube's Board of Directors--Artis was strictly passive. Id. Artis did not 28 conduct due diligence for or analyze the merger agreement. Id. RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 7 CASE NO.: 3:08-MC-80129-SI 1 2 2. TriplePoint and Its Equipment Loan and Lease to YouTube TriplePoint is a debt and equipment financier. In April and August 2006, TriplePoint 3 entered into contracts with YouTube that allowed YouTube to lease and ultimately purchase 4 computer servers from TriplePoint. In exchange, TriplePoint obtained warrants to buy YouTube 5 stock at TriplePoint's option. Declaration of Kevin Thorne in Support of Respondents' 6 Opposition to Plaintiffs' Joint Motion to Compel Production of Documents Pursuant to 7 Subpoenas ("Thorne Decl.") 4-6. At no point did TriplePoint exercise control over YouTube 8 or become involved in decision-making or the setting of business strategies at YouTube. Id. at 9 7. Not surprisingly, given its attenuated role, TriplePoint had no involvement in Google's 10 acquisition of YouTube. Id. at 12. TriplePoint did not conduct due diligence for the merger 11 agreement, and certainly did not analyze the agreement regarding potential copyright 12 infringement liability for YouTube or Google. Id. 13 14 3. Sequoia and Its Investment in YouTube Sequoia had a more significant relationship with YouTube than did Artis or TriplePoint 15 because its investment came earlier in the company's history and on different terms. The 16 relationship was nonetheless limited. 17 Sequoia invested in YouTube's Series A and B rounds of funding, which closed in 18 October 2005 and March 2006 respectively. Declaration of Melinda Dunn in Support of 19 Respondents' Opposition to Plaintiffs' Joint Motion to Compel Production of Documents 20 Pursuant to Subpoenas to Artis Capital Management L.P., Sequoia Capital Operations LLC, and 21 TriplePoint Capital LLC ("Dunn Decl.") 5, 7. Along with its investment, Sequoia was given 22 the right to send a non-voting delegate to YouTube board meetings. Roelof Botha therefore 23 served as one of YouTube's directors from October 2005 through November 2006, when Google 24 acquired YouTube, extinguishing Sequoia's involvement with the company. Id. at 3-6. For 25 roughly a year then, a Sequoia representative served on YouTube's board and was involved at 26 least to some extent, in the company's high-level decision making. It is in recognition of that 27 involvement that Sequoia has already agreed to produce a substantial quantity of documents 28 from that time period. RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 8 CASE NO.: 3:08-MC-80129-SI 1 C. 2 The Subpoenas and the Meet and Confer Process On September 28, 2007, Plaintiffs served identical Subpoenas on Artis and Sequoia, each 3 seeking the same 24 categories of documents. A month later, on October 29, 2007, Plaintiffs 4 served the identical Subpoenas on TriplePoint. Each Non-Party Investor timely objected. 5 Wilkens Decl. Exhs. G-L. The Subpoenas were not only identical to each other, but also 6 virtually identical to--and thus nearly entirely duplicative of--RFPs that had already been 7 served on Defendants YouTube and Google in the litigation. Specifically, 15 of the 24 requests 8 in the Subpoenas are identical to RFPs served on YouTube and Google. Compare Wilkens Decl. 9 Exhs. A-F (Requests 6-8, 10, 12-15, 17-23) with Declaration of Michael Rubin in Support of 10 Respondents' Opposition to Plaintiffs' Joint Motion to Compel Production of Documents 11 Pursuant to Subpoenas to Artis Capital Management L.P., Sequoia Capital Operations LLC, and 12 TriplePoint Capital LLC ("Rubin Decl.") 2, 3, Exhs. A, B (RFPs 6, 26-32, 35-37, 40, 41, 49, 13 64). 14 The Subpoenas are exceptionally broad, owing to the fact that they were cut and pasted 15 from RFPs sent to the Defendants. They demand documents dating from January 1, 2004 to the 16 present, and include demands such as "Each document and all electronically stored information 17 concerning any of the Defendants [YouTube and Google]," and "Each document and all 18 electronically stored information concerning all communications between you and any one of the 19 Defendants [YouTube and Google]." Wilkens Decl. Exhs. A-F (Requests 1 and 4). Apparently 20 recognizing how broad and unreasonable their Subpoenas were, Plaintiffs almost immediately 21 agreed not to pursue five of their requests. Wilkens Decl., Exh. DD. 22 In good faith, the Non-Parties engaged in extensive negotiations with Plaintiffs regarding 23 their objections and production. During the process, which spanned seven months, the Non24 Parties agreed to produce a substantial portion of the requested documents. Indeed, the parties 25 ultimately reached agreement on (or Plaintiffs agreed not to pursue) Request Numbers 1, 3, 4, 6, 26 7, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 22, 23, 24 in the Subpoenas. See Wilkens Decl. Exhs. EE, 27 FF, GG. Through this process, the Non-Parties expended considerable time and resources 28 conducting a reasonable and diligent search for the responsive documents that they had agreed to RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 9 CASE NO.: 3:08-MC-80129-SI 1 produce. Dunn Decl. 13-17; Thorne Decl. 16-17; Declaration of Robert Riemer in Support 2 of Respondents' Opposition to Plaintiffs' Joint Motion to Compel Production of Documents 3 Pursuant to Subpoenas ("Riemer Decl.") 4. 4 D. 5 The Matters Actually in Dispute On May 19, 2008, Plaintiffs detailed the sole "remaining areas of dispute" in a letter to 6 the Non-Parties. Wilkens Decl., Exh. GG. Those areas are (i) the time period covered by the 7 requests, and (ii) requests concerning Google's acquisition of YouTube or other potential 8 investments in or potential acquisitions of YouTube: 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 Instructions 1: "Unless otherwise indicated, the time period covered by these requests is January 1, 2004 through the present." Request Number 8: Each document and all electronically stored information concerning any actual or potential investment in, or financing provided to, and/or any actual or potential divestments of, YouTube including (a) all communications with Defendants and/or potential or actual investors in, or providers of financing to, YouTube, including any representations made concerning YouTube's business model; (b) all documents prepared for or presented to actual or potential investors in, or providers of financing to, YouTube, including any representations made concerning YouTube's business model; and (c) all documents received from actual or potential investors in, or providers of financing to YouTube; and (d) all documents analyzing or assessing investments in or the financing of YouTube, whether prepared by you, Defendants or a third party. Request Number 19: Each document and all electronically stored information concerning Google's acquisition of YouTube, including any reports, analyses or assessments carried out by you, Google, YouTube, investment banks, or any other person, and including any communications between or among you, Google, YouTube and any investor in YouTube or Google. Request Number 20: Each document and all electronically stored information concerning Google's acquisition of YouTube that refers to actual or proposed indemnification or an actual or proposed litigation reserve in relation to copyright infringement lawsuits that might be brought against Defendants in relation to the YouTube website. Request Number 21: Each document and all electronically stored information concerning any person or entity that considered acquiring or merging with YouTube, including persons or entities that entered into negotiations with YouTube regarding a potential acquisition of or merger with YouTube.6 6 A partial objection to Request No. 5, concerning production of certain draft documents, 28 also remained unresolved. In the interests of narrowing the instant dispute, the Non-Parties agree to produce drafts encompassed by Request No. 5, as described in Plaintiffs' December 18, 2007 letter. Wilkens Decl., Exh. DD at 2. CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 10 1 In their Motion, Plaintiffs suggest that the Non-Parties have reneged on their agreement 2 to produce documents. Motion at 6-9, 15. Plaintiffs have it backwards. It is Plaintiffs who 3 agreed to limit (or forego entirely) most of their document Requests--and now may be 4 backtracking from their agreements. Motion at 1, 15-21. The Non-Parties agreed to produce 5 documents and information pursuant to what they believed were facially improper subpoenas to 6 avoid motion practice and to fully resolve the Subpoenas. Wilkens Decl., Exh. GG at 5. The 7 Non-Parties intend to honor those agreements and Plaintiffs should as well. 8 E. 9 The Burden on the Non-Parties The Non-Parties have already expended significant time and expense as a result of the 10 Subpoenas, bearing the excessive burden of collecting the agreed-upon materials. Sequoia 11 undertook the onerous multi-step process of recreating electronic documents stored on backup 7 12 tapes. To accomplish this, Sequoia had to hire an additional IT consultant to locate appropriate 13 tapes, write instructions to extract the relevant data, index the tapes, and retrieve the data to be 14 searched. Dunn Decl. 15-16. This took 30 hours, and Sequoia's regular IT consultant was 15 required to work extended hours to deal with other technical issues in order to prevent delays and 16 disruption of Sequoia employees' work flow. Id. Thereafter, two employees from an outside 17 vendor spent one full week managing the search process and generating a report of relevant 18 documents. Sequoia's on-site IT consultant managed the vendor through this process. Dunn 19 Decl. 16. TriplePoint's Senior Vice President of Compliance & Legal Administration spent 20 some 40 hours searching for and collecting responsive information, during which time he was 21 diverted from performing his regular duties for the firm. Thorne Decl. 15. Artis spent a full 22 business day searching its physical files; a search of electronically stored information was not 23 conducted because it would require a massive devotion of resources for up to twenty-five full 8 24 days. Riemer 4-10. 25 26 27 28 All of Sequoia's files, including email files dated prior to March 2007, are stored on backup tapes. Dunn Decl. 11. Artis' emails dated before June 2006 reside on backup tapes. Riemer Decl. 5. Emails dated after June 21, 2006 are archived by an outside vendor. Riemer Decl. 9. RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 8 7 11 CASE NO.: 3:08-MC-80129-SI 1 2 I. 3 Relevant Standards ARGUMENT The Federal Rules provide that a party may serve a subpoena to obtain discovery from a 4 non-party. Fed. R. Civ. P. 45(a). Notwithstanding Plaintiffs' suggestion (and practice) to the 5 contrary, see Motion at 9-10, there are considerable limits to the reach of a non-party subpoena. 6 Although nowhere acknowledged in Plaintiffs' Motion, the Ninth Circuit long ago 7 observed that the liberal rule for discovery should not apply to non-parties: 8 9 10 11 12 While discovery is a valuable right and should not be unnecessarily restricted, the "necessary" restriction may be broader when a nonparty is the target of discovery. As one district court has noted, "(t)here appear to be quite strong considerations indicating that discovery would be more limited to protect third parties from harassment, inconvenience, or disclosure of confidential documents." One author has stated that the more appropriate nomenclature is "nonparty" discovery, not "third-party" discovery, as "the word nonparty serves as a constant reminder of the reasons for the limitations that characterize `third-party' discovery." 13 Dart Indus. Co. v. Westwood Chem. Co., 649 F.2d 646, 649 (9th Cir. 1980) (internal citations 14 omitted); accord Exxon Shipping Co. v. U.S. Dept. of Interior, 34 F.3d 774, 779 (9th Cir. 1994) 15 (federal rules "afford nonparties special protection against the time and expense of complying 16 with subpoenas"). Numerous other courts have likewise held that the fact of non-party status 17 should be considered by the court in weighing the burdens imposed under the circumstances. See, 18 e.g., Katz v. Batavia Marine & Sporting Supplies, Inc., 984 F.2d 422, 424 (Fed. Cir. 1993) (citing 19 cases); Night Hawk Ltd. v. Briarpatch Ltd, L.P., No. 03 CIV 1382, 2003 WL 23018833, at *8 20 (S.D.N.Y. Dec. 23, 2003) (granting motion to quash subpoena and awarding nonparty sanctions). 21 A non-party subpoena may only seek relevant, nonprivileged information that does not 22 impose an undue burden. Fed. R. Civ. P. 26(b)(2), 45(c)(3)(A); see generally Beinin v. Center for 23 the Study of Popular Culture, C06-2298, 2007 WL 832962, at *2 (N.D. Cal. Mar. 16, 2007) 24 (applying Rule 26 and 45 standards when denying motion to compel non-party discovery). 25 In addition, a court "must" limit discovery under circumstances that are particularly 26 applicable to non-party discovery: 27 28 (i) where "the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive;" 12 CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 1 2 3 4 (ii) (iii) where "the party seeking discovery has had ample opportunity to obtain information by discovery in the action;" or where "the burden or expense of the proposed discovery outweighs its likely benefit, considering the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stake in the action, and the importance of the discovery in resolving the issues." 5 Fed. R. Civ. P. 26(b)(2)(c). Importantly, Rule 45 also mandates that a court "must" quash or 6 modify a subpoena that subjects a person to undue burden. Fed. R. Civ. P. 45(c)(3)(A). 7 Moreover, 8 9 A party or attorney responsible for issuing and serving a subpoena must take reasonable steps to avoid imposing undue burden or expense on a person subject to the subpoena. 10 Fed. R. Civ. P. 45(c)(1). The issuing court "must enforce this duty and impose an appropriate 11 sanction" upon a party who fails to comply with it. Id. And, a court may limit discovery that 12 seeks to disclose a trade secret or other confidential research, development, or commercial 9 13 information. Fed. R. Civ. P. 45(c)(3)(B). 14 II. 15 16 Plaintiffs' Subpoena Requests Seek Documents That Should Be Obtained From Defendants YouTube And Google To The Extent They Are Relevant At All. Plaintiffs assert that responsive documents and information purportedly possessed by the 17 Non-Parties "can be divided in two categories." Motion at 22. Neither category is appropriate for 18 compelled production. 19 20 21 A. Plaintiffs Should Not be Permitted to Seek from Third Parties Materials that are by Definition in the Possession of their Litigation Adversaries. The first category of documents Plaintiffs seek to compel are the Non-Parties' 22 "communications with Defendants." Id. By definition, such documents would be available to 23 the Plaintiffs through discovery from Defendants YouTube and Google. Plaintiffs concede that 24 this "might" be true, but speculate that YouTube's and Google's files may not be complete, for 25 Tacitly conceding the considerable limitations on non-party discovery, Plaintiffs repeatedly characterize the Non-Parties as parties who are financially aligned with YouTube and 27 Google and thus not "disinterested" or "innocent." Motion at 2, 6, 9, 13. As described infra at Argument Section II, Plaintiffs' conclusory assertions based on the Non-Parties' indemnification 28 obligations are incorrect. In any event, whatever purported financial interest the Non-Parties have, that does not change their status from "non-parties" to "parties" in the underlying New York litigation. Plaintiffs cite no case holding otherwise. 26 RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 9 13 CASE NO.: 3:08-MC-80129-SI 1 two reasons. Plaintiffs first note that YouTube employees sometimes used personal email 2 accounts in conducting YouTube business. Motion at 22. Even if true, such documentation and 3 information can, and must, be obtained in the first instance from YouTube or its employees 4 directly. Plaintiffs next assert that YouTube's document retention was "questionable" because it 5 was, at one time, housed in "makeshift offices." Id. Such conjecture cannot be the basis for 10 6 imposing the significant burdens Plaintiffs seek to impose here. At bottom, Plaintiffs cannot 7 impose their broad and burdensome Subpoenas based on pure speculation about what they might 8 not obtain from YouTube's and Google's files. See generally Dibel v. Jenny Craig, Inc., No. 06 9 CV 2533, 2007 WL 2220987, at *2 (S.D. Cal. Aug.1, 2007) (quashing subpoena, despite finding 10 that it sought relevant information, where documents were "readily obtainable" from 11 defendants); E.E.O.C. v. Lexus Serramonte, 237 F.R.D. 220, 223 (N.D. Cal. 2006) (quashing 12 subpoena requesting employee records that were "cumulative, duplicative and irrelevant"); Moon 13 v. SCP Pool Corp., 232 F.R.D. 633, 638 (C.D. Cal. 2005) (quashing subpoena seeking 14 documents that could more easily and inexpensively be obtained directly from parties). 15 Plaintiffs have made no showing of any inadequacies in the Defendants' production 16 (which remains ongoing) or proven that the Non-Parties will have anything that Defendants do 17 not. As a matter of law, Plaintiffs must first exhaust the production process with YouTube and 18 Google and trouble the Non-Parties if, and only if, they can prove some relevant documents 19 remain unavailable to them. See Haworth, Inc. v. Herman Miller, Inc., 998 F.2d 975, 978 (Fed. 20 Cir. 1993) (requiring plaintiff to seek discovery from its party opponent before burdening a 21 nonparty); Dibel, 2007 WL 2220987 at *2 ("Plaintiffs may not employ extraordinary measures 22 that are inconvenient, burdensome and expensive to obtain discovery before propounding 23 customary and appropriate Rule 34 requests."); Harris v. Wells, No. B-89-391, 1990 WL 24 150445, at *4 (D. Conn. Sept. 5, 1990); (granting party's motion for protective order concerning 25 non-party subpoenas; "[D]iscovery should be stayed against these nonparties until it can be 26 10 Plaintiffs fail to mention another potential reason why Google or YouTube might not 27 produce certain documents: it is possible that documents in Google or YouTube's possession would not be produced due to various agreements of the parties. It is entirely inappropriate for 28 Plaintiffs to evade these agreements, and shift the burdens to nonparties, in seeking documents that they have agreed not to seek from Google and YouTube. RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 14 CASE NO.: 3:08-MC-80129-SI 1 determined whether or not all the documents sought by the [defendant] can be obtained from the 2 parties."); Braxton v. Farmer's Ins. Group, 209 F.R.D. 651, 653 (N.D. Ala. 2002) (granting 3 defendant's motion to quash non-party subpoenas; such discovery cannot proceed "[w]ithout a 4 showing by the plaintiff that the defendant's production of all such email messages and other 5 correspondence it can locate is inadequate....") (emphasis in original). Since Plaintiffs failed to 6 make such a showing in their opening papers, the Court should reject Plaintiffs' efforts to burden 7 the Non-Parties with discovery demands that can be satisfied by the Defendants in the first 8 instance. 9 10 11 B. Internal Analyses Generated by the Non-Parties are Irrelevant to Plaintiffs' Litigation Against Google and YouTube. The second "category" of documents that Plaintiffs seek to compel consists of the Non- 12 Parties' internal analyses and communications with third parties about Google's acquisition of 13 YouTube and any potential investments in YouTube. Motion at 22. But Plaintiffs offer no 14 explanation as to why such documents are relevant to their claims against the Defendants. In 15 truth, they are not. In fact, another Court in this District recently and squarely addressed the 16 identical issue. Visto Corp. v. Smartner Info. Sys., Ltd., Nos. 06-80339 and 06-80352, 2007 WL 17 218771 (N.D. Cal. Jan. 29, 2007). In Visto, nonparty Meritech, a venture capital firm, was 18 subpoenaed for information pertaining to its internal analysis of defendant Visto and its ultimate 19 decision to invest in Visto. Id. at *4. The subpoenaing party argued that Meritech's internal 20 documents were relevant to two key issues in dispute, but the Court noted that it "fail[ed] to 21 explain how or why discovery into a venture capital firm's internal investment analyses is 22 `reasonably calculated to lead to the discovery of admissible evidence' on either point." Id. The 23 Court then went on to note that "Meritech's analysts may well have looked at and considered the 24 very same types of information and data that a trier of fact--or the parties' respective expert 25 witnesses--would consider when evaluating" the plaintiff's claims, but rejected the very 26 argument made by Plaintiffs here: 27 28 [Plaintiff's] bare assertion that the thought processes of Meritech's analysts and the private conclusions they drew are "clearly relevant" does not make that so. RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 15 CASE NO.: 3:08-MC-80129-SI 1 Id. 2 Plaintiffs offer no better explanation than the subpoenaing party in Visto for why the 3 Non-Parties' internal analyses of YouTube would be relevant to their copyright infringement 4 cases in New York. Plaintiffs' conclusory assertions that the Non-Parties had "privileged" 5 influence over YouTube's management, or controlled or acted as YouTube's agent, easily fail. 6 Motion at 23. Plaintiffs' assertions about Artis and TriplePoint are completely false, as they had 7 no "influence" on the company at all. See supra at Factual Background Section E. As for 8 Sequoia, Plaintiffs' assertions rely solely on the fact that one Sequoia representative (Mr. Botha) 9 served on YouTube's Board of Directors. But if Mr. Botha undertook analyses or had 10 discussions with third parties in his role as a YouTube director, those documents can and must be 11 sought from YouTube. Any internal Sequoia analyses simply are not germane. 12 Plaintiffs repeated invocation of "indemnification provisions" in the Google/YouTube 13 agreement provides no answer on this point. The Non-Parties internal analyses remain internal 14 analyses--and thus irrelevant to the underlying litigation--regardless of why they were created. 15 Any number of non-parties--law professors, journalists, and even Viacom's shareholders or 16 indemnitors--might hold an opinion about this case. But the opinions or musings of these non11 17 parties are just that, and not an appropriate subject for discovery. 18 III. 19 20 supra. 21 22 23 Request Numbers 8, 19, 20, and 21 Are Invalid for Additional Reasons. The specific Requests in dispute suffer from defects beyond those identified in Section II, A. Plaintiffs' Time Period Instruction Is Grossly Overbroad and Seeks Irrelevant Information. The Subpoenas seek documents dating from January 1, 2004 to the present. But 24 YouTube was not even founded until February 15, 2005, as Plaintiffs acknowledge. Motion at 25 For what it is worth, Plaintiffs overstate the significance of the "indemnification 26 provisions." Pursuant to the agreement between Google and YouTube, at least 35 YouTube shareholders--in addition to the Non-Parties--agreed to "indemnify" Google for all manner of 27 claims: alleged failures of representations and warranties in the merger agreement; alleged breaches of those representations and warranties; certain copyright actions; and the amount of 28 dissenting share payments. Wilkens Decl., Exh. Y at 70-71. There is nothing unusual about such a provision, let alone anything to indicate that it would generate analyses by the Non-Parties (or others) of relevance to the litigation. CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 16 11 1 19. Plaintiffs posit that YouTube's founders may have developed their business concept and 2 initiated communications with potential investors before formally founding the company. Id. 3 This Court need not waste time on such speculation, because the Non-Parties did not even 4 consider investing in YouTube until months after it was founded: Sequoia first considered an 5 investment in YouTube in August 2005. Dunn Decl. 4. Artis first considered one in or after 6 January 2006. Lamond Decl. 3. TriplePoint first considered one in January 2006. Thorne 7 Decl. 3. There is no basis for requiring Non-Parties to search for documents dating back far 8 earlier than any date of possible relevance. 9 Plaintiffs' attempt to seek documents dated after November 13, 2006, the date Google 10 acquired YouTube, fares no better. Motion at 19. As of November 13, 2006, Sequoia's and 11 Artis' early seed investments in YouTube, and TriplePoint's shares of YouTube stock obtained 12 through the exercise of its warrants, were converted to Google common stock. Dunn Decl. 9; 13 Lamond Decl. 8; Thorne Decl. 11. The Non-Parties became just like any other Google 14 shareholders and Mr. Botha ceased to serve on YouTube's Board. Dunn Decl. 9. Whatever 15 purported analyses might have been undertaken by the Non-Parties in connection with their 16 investments in YouTube or in connection with reviewing the proposed YouTube/Google merger, 17 such analyses would, of necessity, have been completed by the merger's closing date of 18 November 13, 2006. Likewise, even if the Non-Parties had some unique influence over 12 19 YouTube--and they did not--it would have necessarily ceased by November 13, 2006. There 20 is no basis for requiring Non-Parties to search for documents dating after any date of possible 21 relevance. 22 23 24 B. Request Number 8 Is Overbroad and Seeks Irrelevant Information Regarding Potential Investments in YouTube. In the interests of compromise, the Non-Parties agreed to produce documents pertaining 25 to their actual investments in YouTube. Plaintiffs acknowledge this, but complain that the Non26 27 Sequoia partner Mr. Moritz held a seat on Google's Board, but that ended in May 2007. Dunn Decl. 3. To the extent sought, whatever information Mr. Moritz obtained as a 28 Google director must be obtained from Google, and not the venture capital firm of which Mr. Moritz is a partner. RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 12 17 CASE NO.: 3:08-MC-80129-SI 1 Parties have objected to producing documents pertaining to third parties' potential investments in 2 YouTube. Motion at 13-14. 3 Plaintiffs' demand for documents and information concerning third parties' potential 4 investments in YouTube fails for all of the reasons articulated above: any such information must 5 be obtained directly from YouTube, or from the third parties contemplating such investments. 6 And, to the extent the Non-Parties performed some analysis of potential third parties' 7 investments in YouTube--a dubious and unsupported assertion--the Non-Parties' views on any 8 such potential investments have nothing to do with Plaintiffs' allegations of copyright 9 infringement in the underlying New York litigation. 10 11 12 C. Request Numbers 19, 20, and 21 Are Overbroad and Seek Irrelevant Information Regarding Google's Acquisition of YouTube. Request Numbers 19, 20, and 21 seek documents pertaining to Google's acquisition of 13 YouTube and to other potential acquisitions of YouTube. As an initial matter, Plaintiffs' 14 demand for documents and information pertaining to potential acquisitions of YouTube is more 15 of the same. If Plaintiffs seek those documents, they should obtain them first from Google and 16 YouTube. If one of the Non-Parties possesses purely internal analyses of a potential acquisition 17 of YouTube, those documents are no more relevant than any of the other internal documents 18 Plaintiffs seek. 19 With regard to Plaintiffs' demand for documents and information pertaining to the actual 20 acquisition of YouTube by Google, this information, too, can be obtained from YouTube or 21 Google. The Requests themselves make this plain: Request Number 19 seeks, among other 22 things, analyses and assessments carried out by "Google, YouTube, investment banks, and any 23 other person." 24 To support their argument, Plaintiffs again rely on broad, and inaccurate, conjecture. 25 Here, Plaintiffs posit that that all three Non-Parties "would have played a significant and active 26 role in evaluating Google's acquisition of YouTube." Motion at 13. This is sheer speculation 27 and it is wrong. TriplePoint played no role in connection with the merger, and conducted no 28 copyright infringement analysis for it. Thorne Decl. 12. Likewise, Artis--as an entirely RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 18 CASE NO.: 3:08-MC-80129-SI 1 passive investor--did nothing more than vote to approve the merger in accordance with 2 YouTube's Board's recommendation and at the same time that other investors so voted, 3 performing no independent analysis. Lamond Decl. 7. Further, and also contrary to Plaintiffs' 4 assertion, Motion at 13, no Sequoia partner sat on Google's Board for purposes of the 5 acquisition; Mr. Moritz recused himself. Dunn Decl. 3. Whatever information Sequoia's Mr. 6 Mr. Botha received or possessed while on YouTube's Board can and should be sought from 7 YouTube. 8 Plaintiffs also again point to the merger agreement's indemnification provisions, and 9 imagine that YouTube's potential liability for copyright infringement must have been a central 10 consideration for the Non-Parties. Id. Again, not so. Plaintiffs' reliance on the indemnification 11 provisions is entirely inapposite; these are standard indemnification provisions covering a variety 12 of claims asserted within one year of the merger. One simply cannot infer from them that the 13 Non-Parties are likely to have relevant information concerning the claims in the underlying New 14 York litigation--much less information that is different from that possessed by YouTube or 15 Google, or information that justifies the burdensome search that Plaintiffs would force Non16 Parties to undertake. 17 18 D. Requiring Further Search and Review Would Impose an Undue Burden. As detailed above, the Non-Parties have already expended significant time and resources, 19 and endured disruption to their businesses, to search for responsive documents. See infra at 20 Factual Background, Section E. To require the Non-Parties to go back and search their files 21 again would magnify those burdens--and it would be particularly undue in view of the limited or 22 non-existent relevance of the information sought. 23 Plaintiffs make the remarkable, and not surprisingly unsupported assertion that "venture 24 capital firms like Respondents are likely to store documents in a way that makes responsive 25 information easy to find." Motion at 21. This is simply untrue. Artis would have to recreate and 26 search electronic documents on backup tapes, an arduous process estimated to take seventeen to 27 twenty full days. Riemer Decl. 6-7. And, there can be no assurance that the entire universe of 28 documents to be searched would be recreated, or that keyword searches of restored documents RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 19 CASE NO.: 3:08-MC-80129-SI 1 would be successful. Id. Furthermore, to search additional electronically stored information, 2 Artis would have to construct keyword searches to be run by an outside vendor, and then run 3 sub-searches. Id. at 7. This process is likely to take at least four to five additional days. Id. 4 The burden would be no less significant for Sequoia or TriplePoint. Sequoia would have to 5 retread the steps it already took: spend at least 30 hours of on-site IT consultant time, plus another 6 week of vendor time as managed by an IT consultant, to recreate and search documents from 7 backup tapes. Dunn Decl. 17. In addition, Sequoia has worked with Google on a number of 8 deals entirely unrelated to YouTube. Id. at 3. Merely conducting a keyword search for 9 "Google," for example, would capture far too much information to review and process and risk 10 substantial business disruption. Id. at 18. Finally, TriplePoint estimates that a second search 11 would require significant additional time of a senior member of its staff's time. Thorne Decl. 18. 12 Plaintiffs wrongly dismiss the extensive efforts already undertaken--labeling them a "self- 13 serving initial search"--and disregard entirely the burdens that would occasion a further search and 14 collection effort. Motion at 21. Yet it was Plaintiffs who demanded that the Non-Parties conduct 15 their search for responsive documents before final resolution had been reached on all outstanding 16 issues. Indeed, as far back as December 2007 and months before the meet and confer process would 17 end, Plaintiffs demanded a date certain upon which documents would be produced. Rubin Decl., 6, 18 Exh. E. These demands came with increasing frequency in the months that followed. Id. 19 Accordingly, the Non-Parties undertook the onerous process of searching for, collecting and 20 reviewing documents, so that they could be in a position to produce the agreed-upon materials within 21 Plaintiffs' requested timeframe--with the expectation that doing so would prevent the need for 22 motion practice. Instead, those efforts have now been distorted in Plaintiffs' misguided effort to cast 23 the Non-Parties as unreasonable. The Non-Parties should not be made to undertake a second 24 burdensome search when Plaintiffs themselves set in motion the search that the Non-Parties have 25 already conducted. 26 27 28 RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 20 CASE NO.: 3:08-MC-80129-SI 1 IV. 2 3 Any Production by the Non-Parties Must Be Governed by a Suitable Protective Order Entered by this Court. During the meet and confer process, the Non-Parties repeatedly advised Plaintiffs that 4 any production must be governed by a suitable protective order entered by this Court. See 5 Wilkens Decl. Exhs. HH at 8, KK at 4. Although Plaintiffs now dispute this, Motion at 8, 15, 6 entry of a protective order by this Court is critical for at least three reasons. 7 First, and most fundamentally, any production will necessarily take place in California, 8 where the Non-Parties, their documents, and their employees are all located. Dunn Decl. 19; 9 Riemer Decl. 11; Thorne Decl. 19. The Subpoenas were issued from this Court, and this Court 10 has now been called upon to rule on certain aspects of them. Fed. R. Civ. P. 45(a)(2)(C), (c)(3). This 11 Court should therefore address any issues arising from the subsequent production, in California. 12 Second, as noted above, each of the Non-Parties, their documents, and their employees 13 are located in California. The Non-Parties should not have to bear the considerable expense and 14 burden of enforcing any protective order in New York. 15 Third, and relatedly, Plaintiffs have already violated the protective order entered in New 16 York. Just last week, the district court in New York ruled that Plaintiffs violated its protective 17 order by providing documents designated as "Confidential" and "Highly Confidential" to an 18 individual who is suing YouTube and Google in separate litigation in California. Rubin Decl., 19 4 Exh. C. Those "Confidential" and "Highly Confidential" documents included documents 20 produced by nonparties, including a nonparty who produced documents pursuant to a subpoena 21 issued from this Court. The nonparties had designated their documents as "Confidential" and 22 "Highly Confidential" under the New York protective order. Thus, Plaintiffs' violation of the 23 New York protective order directly affected the rights of nonparties. The Non-Parties should 24 not, under any circumstances (and certainly not under those presented here), have to bear the 25 risk, expense and burden of litigating in New York to enforce the terms of a protective order 13 26 governing their production of documents in California. 27 28 Although TriplePoint may have originally produced a limited set of documents pursuant to a protective order entered in New York, Wilkens Decl., Exh. II, it later determined that it should not have to bear the expense and burden of enforcing the protective order in New York. TriplePoint's CASE NO.: 3:08-MC-80129-SI RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 21 13 1 2 CONCLUSION For the foregoing reasons, Plaintiffs' Motion should be denied. Respectfully submitted, WILSON SONSINI GOODRICH & ROSATI Professional Corporation By: /s/ Michael Rubin Michael Rubin 3 Dated: July 21, 2008 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 concerns were prescient, given Plaintiffs' subsequent violations of the New York protective order. RESPONDENTS' OPPOSITION TO MOTION TO COMPEL 22 CASE NO.: 3:08-MC-80129-SI

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