Trendsettah USA, Inc. et al v. Swisher International, Inc.

Filing 12

ORDER RE: MOTION FOR ORDER TO SHOW CAUSE AND MOTION TO TRANSFER OR DISMISS: The 2 MOTION That Third Parties Appear and Show Cause Why They Should Not Be Held in Civil Contempt for Failing to Appear for Deposition and/or for Failing to Produce Documents is denied. The subpoena served on Polk & Green Market is enforceable here - the court where compliance is required -- and thus may be transferred pursuant to Rule 45(f). But plaintiff's counsel's representation is not enough to establish Polk & Green's consent to transfer unless counsel is Polk & Green's attorney. Accordingly, by 1/19/2016, Plaintiff's counsel shall file a supplemental declaration stating that he is acting as the attorney for Polk & Green an d in that capacity avers that Polk & Green consents to transfer. In the alternative, Polk & Green must itself consent in writing to transfer pursuant to Rule 45(f). If no such consent is filed, the 2 Motion for Compliance and Contempt will be heard as to Polk & Green on 1/21/2016 at 11:00 a.m. Signed by Judge Jacqueline S. Corley on 1/14/2016. (afmS, COURT STAFF) (Filed on 1/14/2016)

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1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 TRENDSETTAH USA, INC., et al., Plaintiffs, 8 9 10 United States District Court Northern District of California 11 Case No. 15-mc-80315-JSC v. SWISHER INTERNATIONAL, INC., Defendant. ORDER RE: MOTION FOR ORDER TO SHOW CAUSE AND MOTION TO TRANSFER OR DISMISS Re: Dkt. Nos. 2, 6 12 13 This miscellaneous action pertains to an antitrust dispute now pending in the Central 14 District of California. Plaintiffs Trendsettah USA, Inc. and Trend Settah, Inc. (together, 15 “Plaintiff”) alleges that Defendant Swisher International, Inc. (“Defendant”) engaged in certain 16 anticompetitive conduct, including disparaging Plaintiff’s competing band of cigarillos, a type of 17 small cigar. Defendant filed this miscellaneous action to enforce three subpoenas issued to third 18 parties who have knowledge of Defendant’s alleged anticompetitive conduct. (Dkt. No. 2.) 19 Specifically, Defendant seeks an order to show cause why third parties SM Brothers, Inc., 20 Sandeep Mehat, Polk & Green Market, and Allmey Enterprises Inc. d/b/a Toby’s Vapes & More 21 (collectively, the “Third Parties”) should not be held in civil contempt for failing to comply with 22 the subpoenas and an order compelling their compliance. (Id.) 23 The Third Parties neither responded to the subpoenas nor to Defendant’s motion. Instead, 24 now pending before the Court is Plaintiff’s motion to transfer this enforcement action to the 25 Central District of California or, in the alternative, to dismiss the action altogether. (Dkt. No. 6.) 26 Two of the subpoenas were issued to Third Parties located in Chowchilla, California, which is in 27 the Eastern District of California, while one was served here in San Francisco. (Dkt. No. 3 ¶ 10 & 28 Ex. D; id. ¶ 13 & Ex. G.) 1 Federal Rule of Civil Procedure 45 states that “[a]t any time, on notice to the commanded 2 person, the serving party may move the court for the district where compliance is required for an 3 order compelling production or inspection.” Fed. R. Civ. P. 45(d)(2)(B)(i). Further, the “court 4 where compliance is required . . . may hold in contempt a person who, having been served, fails 5 without adequate excuse to obey the subpoena or an order related to it.” Fed. R. Civ. P. 45(g). 6 Thus, Defendant’s motion as to the two Third Parties located in the Eastern District of California 7 was brought in the wrong court; the Northern District, as neither the issuing court nor the court 8 where compliance is required, has no authority to order compliance or find these parties in 9 contempt. 10 Recognizing this error, Defendant asks the Court to transfer its motion to the Central United States District Court Northern District of California 11 District of California pursuant to Rule 45(f). That Rule provides that “[w]hen the court where 12 compliance is required did not issue the subpoena, it may transfer a motion under this rule to the 13 issuing court if the person subject to the subpoena consents or if the court finds exceptional 14 circumstances.” Fed. R. Civ. P. 45(f); see also Fed. R. Civ. P. 45(f) 2013 Advisory Committee 15 Notes (“If the person subject to the subpoena consents to transfer, Rule 45(f) provides that the 16 court where compliance is required may do so.”). Plaintiff represents that the subpoenaed Third 17 Parties all consent to transfer of this miscellaneous action to the courtroom of the Honorable 18 James Selna in the Southern Division of the Central District of California, where the underlying 19 case is pending. (Dkt. No. 6 at 5.) Plaintiff’s counsel avers that he spoke with the Third Parties 20 and explained the posture of the case, and that the Third Parties “advised [him] that they consent 21 to having this issue transferred to the trial court in the Central District.” (Dkt. No. 6-1 ¶ 5.) And 22 indeed, Defendant agrees that transfer to the Central District is appropriate provided that the Third 23 Parties consent to the transfer in writing. (Dkt. No. 8 at 2.) 24 But this Court has no authority to transfer Defendant’s motion as to the Third Parties 25 located in the Eastern District of California. By its express terms, Rule 45(f) allows for transfer by 26 “the court where compliance is required.” The Northern District of California is not such a court 27 for the Eastern District Third Parties. “[W]hen subpoena-related motions are filed in the wrong 28 court, Rule 45(f) does not provide a means for transferring those motions to the court that issued 2 1 the subpoenas.” Agincourt Gaming, LLC v. Zynga, Inc., No. 2:14-cv-0708-RFB-NJK, 2014 WL 2 4079555 *4 (D. Nev. Aug. 15, 2014). 3 Defendant’s citation to Miller v. Hambrick, 905 F.2d 259, 262 (9th Cir. 1990), is 4 unavailing as Miller (and 28 U.S.C. § 1631) do not address the very specific language of Rule 45. 5 Even if section 1631 applied, the Court does not find that it would be “in the interests of justice” 6 to transfer Defendant’s motion to the Central District of California or the Eastern District of 7 California. Rule 45 is designed to encourage parties to enforce subpoenas in districts that reduce 8 the inconvenience to third parties as much as possible. See Fed. R. Civ. P. 45(f) 2013 Advisory 9 Committee Notes (“To protect local nonparties, local resolution of disputes about subpoenas is assured by the limitations of Rule 45(c) and the requirements in Rules 45(d) and (e) that motions 11 United States District Court Northern District of California 10 be made in the court in which compliance is required under Rule 45(c).”). To simply transfer 12 Defendant’s improperly filed motion would encourage parties to not take care to file motions in 13 the proper courts, thus necessitating the third party to defend in a distant court, which is 14 inconsistent with the Rules’ long-held emphasis on minimizing the discovery burden on third 15 parties. See U.S. v. McGraw-Hill Cos., 302 F.R.D. 532, 534-35 (C.D. Cal. 2014) (collecting cases 16 and discussing courts’ duty to shift third parties’ cost of compliance with subpoenas to ensure the 17 third parties’ burden in responding is not significant); see also High Tech Med. Instrumentation, 18 Inc. v. New Image Indus., Inc., 161 F.R.D. 86, 88 (N.D. Cal. 1995) (“Both the language of [the 19 Federal Rules] and that of the Ninth Circuit . . . make clear that sanctions are appropriate if the 20 subpoenaing party fails to take reasonable steps to avoid imposing an undue burden on a third 21 party.”) (citing former Rule 45(c)(1), now Rule 45(d)(1)). Further, a transfer in these 22 circumstances would vitiate Rule 45’s requirement of third party consent. The Eastern District 23 Third Parties allegedly consent to transfer to the Central District only as an alternative to 24 dismissal. Accordingly, Defendant’s motion for an order to show cause and for an order of 25 compliance as to the Third Parties located in the Eastern District of California is DENIED. 26 The subpoena served on Polk & Green Market is enforceable here—the court where 27 compliance is required—and thus may be transferred pursuant to Rule 45(f). But Plaintiff’s 28 counsel’s representation is not enough to establish Polk & Green’s consent to transfer unless 3 1 counsel is Polk & Green’s attorney. Accordingly, by January 19, 2016, Plaintiff’s counsel shall 2 file a supplemental declaration stating that he is acting as the attorney for Polk & Green and in that 3 capacity avers that Polk & Green consents to transfer. In the alternative, Polk & Green must itself 4 consent in writing to transfer pursuant to Rule 45(f). If no such consent is filed, the motion for 5 compliance and contempt will be heard as to Polk & Green on January 21, 2016 at 11:00 a.m. 6 (please note the changed time). 7 8 IT IS SO ORDERED. Dated: January 14, 2016 9 JACQUELINE SCOTT CORLEY United States Magistrate Judge 10 United States District Court Northern District of California 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 4

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