B & R Supermarket, Inc., et al v. Visa, Inc. et al

Filing 406

Discovery Order re 401 . Signed by Judge Maria-Elena James on 3/1/2017. (mejlc2S, COURT STAFF) (Filed on 3/1/2017)

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1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 B & R SUPERMARKET, INC., ET AL., 7 Case No. 16-cv-01150-WHA (MEJ) Plaintiffs, 8 DISCOVERY ORDER v. Re: Dkt. No. 401 9 VISA, INC., et al., 10 Defendants. United States District Court Northern District of California 11 12 INTRODUCTION 13 Pending before the Court is Plaintiffs1 and non-party EMVCo, LLC’s (“EMVCo”) joint 14 15 discovery letter regarding EMVCo’s redactions of a document produced in discovery. Letter, Dkt. 16 No. 401. Having considered the parties’ positions, the relevant legal authority, and the record in 17 this case, the Court issues the following order. BACKGROUND 18 This is a putative class action in which Plaintiffs allege certain payment card networks 19 20 conspired to shift liability for fraudulent card transactions from issuing banks to merchants until a 21 merchant obtained certification to accept chip-enabled EVM cards (the “Liability Shift”). 22 Plaintiffs assert claims under the Sherman Antitrust Act, 15 U.S.C. §§ 1 and 3, and various state 23 antitrust and deceptive practices laws. Am. Compl. ¶¶ 285-361, Dkt. No. 291. They seek to 24 represent a class of “merchants who have been unlawfully subjected to the so-called Liability Shift 25 for the assessment of MasterCard, Visa, Discover and/or American Express credit and charge card 26 chargebacks, from October 2015 until the anticompetitive conduct ceases[.]” Id. ¶ 238. Plaintiffs 27 1 28 Plaintiffs are B & R Supermarket, Inc.; Grove Liquors LLC; Strouk Group LLC (d/b/a Monsieur Marcel); Palero Food Corp.; and Cagueyes Food Corp. (d/b/a Fine Fare Supermarket). 1 2 seek class certification under Federal Rule of Civil Procedure 23(b)(2) and (b)(3). See id. EMVCo is a company “overseen” by Visa, Inc.; Visa USA, Inc., MasterCard International 3 Inc.; American Express Co.; and Discover Financial Services. Am. Compl. ¶ 38. Among other 4 things, EMVCo “develops and manages the technical standards by which EMV chip transactions . 5 . . are processed and maintained.” Id. Plaintiffs named EMVCo as a defendant, but the presiding 6 judge in this matter, the Honorable William Alsup, dismissed EMVCo on September 30, 2016. 7 Order at 19, Dkt. No. 346. Judge Alsup nonetheless noted that because “EMVCo will be required 8 to provide discovery (as a nonparty), the possibility remains that evidence will be developed to 9 show complicity by it such that a motion to amend based on newly discovered evidence will be allowed.” Id. Judge Alsup ordered EMVCo to preserve evidence, including “all emails, 11 United States District Court Northern District of California 10 memorandums, text messages, or any other potential evidence relevant to the Liability Shift and 12 the circumstances that led up to it.” Id. at 19, 22. 13 14 15 16 The parties filed this Letter on February 28, 2017. The deadline to add parties is March 3, 2017. Dkt. No. 348. LEGAL STANDARD Federal Rule of Civil Procedure 26 provides that a party may obtain discovery “regarding 17 any nonprivileged matter that is relevant to any party’s claim or defense and proportional to the 18 needs of the case[.]” Fed. R. Civ. P. 26(b)(1). Factors to consider include “the importance of the 19 issues at stake in the action, the amount in controversy, the parties’ relative access to relevant 20 information, the parties’ resources, the importance of the discovery in resolving the issues, and 21 whether the burden or expense of the proposed discovery outweighs its likely benefit.” Id. 22 Discovery need not be admissible in evidence to be discoverable. Id. However, “[t]he parties and 23 the court have a collective responsibility to consider the proportionality of all discovery and 24 consider it in resolving discovery disputes.” Fed. R. Civ. P. 26 advisory committee notes (2015 25 amendments). Thus, there is “a shared responsibility on all the parties to consider the factors 26 bearing on proportionality before propounding discovery requests, issuing responses and 27 objections, or raising discovery disputes before the courts.” Salazar v. McDonald’s Corp., 2016 28 WL 736213, at *2 (N.D. Cal. Feb. 25, 2016); Goes Int’l, AB v. Dodur Ltd., 2016 WL 427369, at 2 1 *4 (N.D. Cal. Feb. 4, 2016) (citing advisory committee notes for proposition that parties share a 2 “collective responsibility” to consider proportionality and requiring that “[b]oth parties . . . tailor 3 their efforts to the needs of th[e] case”). DISCUSSION 4 The parties’ dispute concerns EMVCo’s Board of Managers meeting minutes (the 5 6 “minutes”), which EMVCo produced to Plaintiffs with redactions “for privilege and 7 responsiveness.” Letter at 2.2 Plaintiffs do not object to EMVCo’s redactions for privilege; they 8 only dispute the redactions for non-responsiveness. Plaintiffs estimate “EMVCo has redacted for 9 non-responsiveness 293 of 303 Board of Manager meeting minutes.”3 Id. at 3. EMVCo did not redact headings, which has allowed Plaintiffs to discern topics which it 10 United States District Court Northern District of California 11 believes demonstrate the redacted minutes are relevant to this action. See id. at 2-3. The parties 12 successfully resolved some of their disputes prior to filing this Letter: Plaintiffs contacted EMVCo 13 on December 5, 2016 and January 20, 2017 regarding certain redactions, and EMVCo agreed to 14 produce in unredacted form those portions of the minutes. Id. Specifically, EMVCo represents it 15 “has agreed to produce the nonprivileged portions of the remainder of the minutes” for topics 16 concerning “Security Evaluation Working Group, Security Working Group, Communications 17 Update, Card Approval Working Group, Interoperability Working Group, Update from PCI, EAP 18 Update, and Terminal Approval Working Group.” Id. at 6. EMVCo has also agreed to produce 19 unredacted portions of the minutes regarding “the topic of negotiations about prospective new 20 equity membership in EMVCo[.]” Id. EMVCo notes “[t]here are no outstanding topics identified 21 by Plaintiffs as being improperly redacted.” Id. It is unclear whether Plaintiffs have fully 22 reviewed or take issue with other parts of the minutes. In light of the parties’ successful meet-and-confers thus far, the Court finds it would be 23 24 more efficient and productive for the parties to continue to attempt to resolve this issue 25 26 2 Because the Letter is unnumbered, the Court’s citations to pages of the Letter refer to the ECF header numbering. 27 3 28 It is unclear whether the “293 of 303” refers to pages or something else. In compliance with the Court’s Discovery Standing Order, the parties did not attach the minutes to their Letter. Id. at 6. 3 1 cooperatively. The Court accordingly ORDERS the parties to continue to meet and confer to 2 address any and all disputes relating to the minutes. If EMVCo believes redactions to the minutes 3 are appropriate for another reason other than relevance, it shall produce a privilege log explaining 4 basis for the redactions. If Plaintiffs dispute those explanations, the parties shall attempt to resolve 5 those disputes during a meet and confer session. Thereafter, the parties may raise any outstanding 6 disputes by filing an updated joint letter brief.4 IT IS SO ORDERED. 7 8 9 Dated: March 1, 2017 ______________________________________ MARIA-ELENA JAMES 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 While the deadline to amend the Complaint to add parties is fast approaching, the parties do not raise any issues of timing in their Letter, nor have they sought to extend the deadline to amend. The Court accordingly proceeds with the understanding the deadline is not relevant to this dispute. 4

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