Digital Reg of Texas, LLC v. Adobe Systems Incorporated et al

Filing 439

Order by Magistrate Judge Kandis A. Westmore re 372 Discovery Letter Brief submitted by Digital Reg and Electronic Arts.(kawlc1, COURT STAFF) (Filed on 9/30/2013)

1
2

United States District Court
Northern District of California

3
4
5
6

DIGITAL REG OF TEXAS, LLC,
Plaintiff,

7
8
9
10

United States District Court
Northern District of California

11
12

v.
ADOBE SYSTEMS INCORPORATED,
VALVE CORPORATION, ELECTRONIC
ARTS INC., UBISOFT, INC., SYMANTEC
CORPORATION, AVG TECHNOLOGIES
USA, INC., ZYNGA GAME NETWORK
INC., ZYNGA, INC., and INTUIT INC.,

Case No.: CV 12-01971-CW (KAW)
ORDER RE: PLAINTIFF AND
DEFENDANT ELECTRONIC ARTS INC.’S
5/15/2013 JOINT DISCOVERY LETTER
(Dkt. No. 372)

Defendant.

13
14
15

Plaintiff Digital Reg of Texas, LLC (“Digital Reg”) filed this action against several

16

defendants, including Electronic Arts Inc. (“EA”), for patent infringement in violation of the U.S.

17

Patent Act, 35 U.S.C. § 271. The parties filed an updated joint discovery letter on May 15, 2013

18

(“5/15/13 Joint Letter”), in which both sides identify perceived deficiencies in their opposing

19

party’s discovery responses. (Dkt. No. 372.)

20

Digital Reg contends that EA has failed to provide adequate discovery in three areas: (1)

21

financial information relating to the use of the accused instrumentalities; (2) basic interrogatory

22

responses; and (3) production of a deponent under Federal Rule of Civil Procedure 30(b)(6).
EA also contends that Digital Reg has failed to provide adequate discovery in three areas

23
24

and seeks to compel the following: (1) Digital Reg’s amended responses to Common

25

Interrogatory Nos. 1, 2, 3, and 5; (2) the production of documents from prior lawsuits relating the

26

Patents-in-Suit.; and (3) the production of documents requested by way of third party subpoena to

27

Intellectual Profit LLC.

28

///

1

In accordance with Civil L.R. 7-1(b), this matter is deemed suitable for disposition

2

without hearing. In light of the joint letter and the documents submitted by the parties, the Court,

3

for the reasons set forth below, DENIES Digital Reg’s request for further financial information.

4

The Court GRANTS IN PART AND DENIES IN PART Digital Reg’s request for further

5

responses to Common Interrogatory Nos. 6, 13, and 15, and Individual Interrogatory Nos. 1, and

6

6-8. The Court DENIES Digital Reg’s request to compel the recall of EA’s Rule 30(b)(6)

7

deponent.
Additionally, the Court GRANTS IN PART AN DENIES IN PART EA’s request for

8
9
10

further responses to Common Interrogatory Nos. 1, 2, 3, and 5, and DENIES EA’s requests for
the production of documents from prior lawsuits and from third party Intellectual Profit LLC.
I.

United States District Court
Northern District of California

11

BACKGROUND

Digital Reg alleges that EA directly and indirectly infringe upon its ‘541 Patent (manages

12
13

or regulates access to digital content), the ‘670 and ‘059 Patents (tracking access to digital

14

content), and the ‘150, ‘515’, and ‘655 Patents (delivering electronic content).

15

On April 12, 2013, the parties filed its second joint discovery letter, which EA contended

16

was filed prematurely based on a previous stipulation of the parties. (Dkt. No. 330.) Some of the

17

disputes had been addressed by the Court in its April 12, 2013 order on the parties’ March 13,

18

2013 Joint Discovery Letter, which ordered EA to provide supplemental responses within 21

19

days. (4/12/13 Order, Dkt. No. 327.).
Pursuant to a stipulation of the parties (Dkt. Nos. 328 & 337), the fact discovery cutoff

20
21

was extended until April 30, 2013, and the last day to file a joint letter for disputes related to fact

22

discovery was on May 7, 2013. See Civil L.R. 37-3 (“no motions to compel fact discovery may be

23

filed more than 7 days after the fact discovery cut-off”).1
On May 9, 2013, to determine whether any of the disputes identified in the April 12 Joint

24
25

Letter were obviated by EA’s supplemental responses due May 3, 2013, the Court issued an order

26
27
28

While this Court does not entertain motions to compel, the Court follows Civil Local Rule 37-3
to determine the last day to file a joint letter pursuant to the Court’s Standing Order.
1

2

1

requiring that the parties update their April 12 Joint Letter to identify “which discovery disputes,

2

if any, still require court intervention.” (Dkt. No. 365.)

3

On May 15, 2013 the parties filed the joint discovery letter currently before the Court.

4

(Dkt. No. 372.) The Court has previously addressed the propriety of the parties’ request to file

5

portions of the joint letter and certain exhibits under seal pursuant to the stipulated protective

6

order currently in effect. (Dkt. Nos. 388 & 391.)
II.

7

LEGAL STANDARD

8

Under Federal Rule of Civil Procedure 26(b)(1), “[a] party may obtain discovery

9

regarding any nonprivileged matter that is relevant to any party's claim or defense.” Fed. R. Civ.
P. 26(b)(1). The information “need not be admissible at the trial” so long as it appears

11

United States District Court
Northern District of California

10

“reasonably calculated to lead to the discovery of admissible evidence.” Id.

12

Rule 45 allows any party to serve a subpoena that commands a non-party "to produce

13

documents, electronically stored information, or tangible things . . ." Fed. R. Civ. P. 45(a)(1)(C).

14

Subpoenas are also subject to the relevance requirements of Rule 26(b), and therefore may

15

command the production of documents which are "nonprivileged [and] . . . relevant to a party's

16

claim or defense." Soto v. Castlerock Farming & Transp., Inc., 1:09-CV-00701 AWI, 2011 WL

17

2680839, at *7 (E.D. Cal. July 8, 2011), quoting Fed. R. Civ. P. 26(b)(1).

18

This broad scope of relevant, discoverable information is limited by the responsibility of

19

the parties to “take reasonable steps to avoid imposing undue burden or expense on a person

20

subject to the subpoena,” and the court may, “[o]n motion or on its own . . . limit the frequency or

21

extent of discovery otherwise allowed by these rules or by local rule if it determines that: (1) the

22

discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other

23

source that is more convenient, less burdensome, or less expensive; (2) the party seeking

24

discovery has had ample opportunity to obtain the information by discovery in the action; or (3)

25

the burden or expense of the proposed discovery outweighs its likely benefit, considering the

26

needs of the case, the amount in controversy, the parties’ resources, the importance of the issues

27

at stake in the action, and the importance of the discovery in resolving the issues.” Fed. R. Civ. P.

28

26(b)(2)(C).
3

III. DISCUSSION

1
2

Digital Reg contends that EA has failed to provide adequate discovery in three areas: (1)

3

financial information relating to the use of the accused instrumentalities; (2) basic interrogatory

4

responses; and (3) sufficiency of Rule 30(b)(6) testimony.

5

EA contends that Digital Reg has failed to adequately respond to the following: (1)

6

interrogatory responses; (2) the production of documents from prior lawsuits relating the Patents-

7

in-Suit.; and (3) the production of documents requested by third party subpoena to Intellectual

8

Profit LLC.

9

A. Digital Reg’s Requests for Relief
1. Requested Financial Information

11

United States District Court
Northern District of California

10

Digital Reg seeks financial information “relating to the sales of digital content distributed

12

using the accused platform.” (5/15/13 Joint Letter at 3.) The Court addressed this dispute in its

13

Order on the March 13, 2013 Joint Letter. (4/12/13 Order, Dkt. No. 327, at 2-4.) Digital Reg

14

contends that EA has not produced all of its records consistent with the April 12 Order, and

15

requests that “EA comply with this Court’s standing order to ‘confirm in writing that they have

16

produced all such materials so described after a diligent search of all locations at which such

17

materials might plausibly exist.’” (5/15/13 Joint Letter at 3-4). Digital Reg’s Request for

18

Production No. 1 only seeks “summary documents sufficient to show” product revenue. Id. at 3.

19

Despite this limitation in its request, Digital Reg now seeks a complete production of EA’s actual

20

business records relating to Origin and digital distribution of games enabled with Origin.” Id.

21

EA contends that it has complied with the April 12 Order and produced its Manager of

22

Financial Planning Dan Givens for deposition. Id. at 4. EA also objects that Digital Reg’s request

23

to “certify that all responsive documents have been produced does not make sense, given Digital

24

Reg’s document request for “summary documents” and the information that EA agreed to

25

produce.” Id. at 4 n. 6. Under the Federal Rules of Civil Procedure, EA does, however, have an

26

ongoing duty to supplement its responses “in a timely manner if the party learns that in some

27

material respect the disclosure or response is incomplete or incorrect, and if the additional or

28

corrective information has not otherwise been made known to the other parties during the
4

1

discovery process or in writing.” Fed. R. Civ. P. 26(e)(1)(A). Given the limitation of Request

2

No. 1, the Court understands why EA does not want to certify that it has produced all summary

3

documents, as the request did not seek all documents, but EA should certify whether it has

4

produced sufficient summary documents to fully respond to the request.

5

The Court has already resolved this discovery dispute, and so DENIES Digital Reg’s

6

request to compel actual business records, as those are not responsive to this request, which only

7

sought “summary documents.” EA shall amend its response to Request No. 1 to state whether it

8

has provided sufficient non-privileged, summary documents to fully respond to the request.

9
10

2. EA’s Responses to Interrogatories
Digital Reg seeks amendment to EA’s responses to First Set of Common Interrogatory No.

United States District Court
Northern District of California

11

6; Second Set of Common Interrogatory Nos. 13 and 15; First Set of Individual Interrogatory No.

12

1; and Third Set of Individual Interrogatory Nos. 6-8. (See Chart, 5/15/13 Joint Letter at 5.) The

13

Court is forced to infer this information from a chart that fails to sufficiently outline the dispute

14

and how EA’s responses are substantively deficient. For example, Digital Reg’s entry in support

15

of the deficiencies in Common Interrogatory Nos. 6 is “Incomplete response. Does not provide

16

U.S. data.” Id. at 5.

17

As an initial matter, EA contends that Digital Reg has failed to meet and confer regarding

18

the alleged deficiencies in EA’s interrogatory responses. Id. at 5. EA asserts that it has

19

supplemented its responses to Common Interrogatory Nos. 6 and 15, and Individual Interrogatory

20

Nos. 1, 3, and 6 to provide “substantive” responses on April 1, 2013, April 10, 2013, May 3,

21

2013, and May 10, 2013. Id. at 5. The Court was only provided with EA’s supplemental

22

responses for Individual Interrogatory Nos. 6 and 9, and Common Interrogatory Nos. 1-10, both

23

dated April 10, 2013, and EA’s Fifth Supplemental Responses and Objections to Common

24

Interrogatory Nos. 1-10. (5/15/13 Joint Letter, Exs. Q, S; Pl.’s Exs. to the Joint Letter, Dkt. No.

25

378, Ex. 11.) After the Court’s limited review, EA seems to have responded to Common

26

Interrogatory No. 6. As to the other allegedly deficient responses, since Digital Reg is alleging

27

the insufficiency, the onus was on Digital Reg to attach all applicable, supplemental responses as

28

exhibits. Absent this information, coupled with Digital Reg’s failure to provide more detail
5

1

pertaining to the alleged deficiencies, the Court will not compel further responses to these

2

interrogatories.

3

EA claims that the Rule 30(b)(6) deposition of its Technical Director of Origin provides

4

all information responsive to Common Interrogatory No. 13. Id. at 5. This argument is not

5

persuasive, as the knowledge of a 30(b)(6) deponent is not necessarily the same as corporate

6

knowledge. EA shall supplement its response to Common Interrogatory No. 13.

7
8
9

As to Individual Interrogatory Nos. 7 and 8, EA must amend its responses to provide
information consistent with this court’s April 12, 2013 order. (See Dkt. No. 327.)
For the reasons set forth above, the Court GRANTS Digital Reg’s request to require EA to
amend its responses to Common Interrogatory No. 13 and Individual Interrogatory Nos. 7 and 8,

11

United States District Court
Northern District of California

10

and DENIES Digital Reg’s other requests for amendment.

12

3. EA’s Deponent under Rule 30(b)(6)

13

Digital Reg contends that “[o]n April 24, 2013, EA presented a witness to address only

14

limited financial information.” (5/15/13 Joint Letter at 5.) Digital Reg now seeks to compel the

15

production of competent witness with respect to the following deposition topics set forth in

16

Digital Reg’s December 7, 2012 Notice of Deposition under Fed. R. Civ. P. 30(b)(6): 13

17

(financials), 14 (projections) and 17 (analyses of the value of DRM).” Id. at 5-6. “Digital Reg

18

further requests an opportunity to depose a corporate designee who is reasonably prepared to

19

testify regarding the supplemental interrogatory responses provided by EA (including most

20

recently on May 10, 2013—attached as Exhibit 11) and any documents produced by EA

21

responsive to [the] Order of this Court.” Id. at 6.

22

EA claims that this dispute is improper for several reasons. First, Digital Reg failed to

23

attempt to meet and confer on this issue in violation of the Court’s Standing Order. Second, this

24

is an entirely new dispute, and should not be included in the instant joint letter, as the Court

25

requested that the parties simply provide an update to the March 13, 2013 Joint Letter. Id.

26

The Court agrees, as its May 9, 2013 order required the parties to update their April 12,

27

2013 joint letter, and did not provide for the inclusion of new discovery disputes. In fact, the

28

cutoff from fact discovery was April 30, 2013, such that the last day to file a joint letter on any
6

1

new fact discovery disputes was May 7, 2013. (See Stipulation Regarding Limited Extension of

2

Fact Disc., Dkt. Nos. 328 & 337.) The instant letter was filed on May 15, 2013, so any novel

3

disputes are untimely. As a result, the Court DENIES Digital Reg’s request to compel the

4

production of additional 30(b)(6) deponents.

5

B. EA’s Requests for Relief

6

1. Digital Reg’s Interrogatory Responses

7

EA seeks amendment to Digital Reg’s responses to Common Interrogatory Nos. 1, 2, 3

8

and 5. (5/15/13 Joint Letter at 7.) EA, however, did not provide copies of its interrogatories nor

9

Digital Reg’s responses, so the Court must depend upon the representations of the parties.

10

Interrogatory Nos. 1 and 2 seek Digital Reg’s position regarding the date of conception for

United States District Court
Northern District of California

11

the patent claims asserted, so that EA can determine which date Digital Reg contends the

12

invention was conceived. Id. This date is relevant to EA’s defenses, because “[t]he priority date is

13

important because it is the date EA must beat to show that the claims are invalid over the prior

14

art.” Id. Digital Reg does not address EA’s arguments, but rather states that “[i]ts responses are

15

monumentally more substantive than those served by EA, especially until its tardy

16

supplementations on April 1, 2013 and on April 10, 2013, nearly two weeks after the close of fact

17

discovery.” Id. This, however, is not the standard, and Digital Reg must amend its responses to

18

fully respond to the interrogatories in regard to the priority date.

19

Interrogatory No. 3 involves marking, and EA alleges that Digital Reg’s response is

20

unclear, because it “fails to identify which specific products it developed ‘for practicing

21

inventions described in the Patents-in-Suit,’ which specific ‘goods and services’ it has ‘marketed,’

22

when they were ‘marketed,’ and whether those ‘goods and services’ were marked with the

23

applicable patent numbers.” (5/15/13 Joint Letter at 8.) EA states that Digital Reg’s responses

24

failed to address “whether it ‘ma[d]e or offer[ed] for sale’ any patented article post-issuance, but

25

instead address only ‘sale[s].’ See 35 U.S.C. § 287 (requiring marking of patent articles that were

26

made, sold, or offered for sale).” Again, Digital Reg did not specifically address how its response

27

was sufficient, and so must amend its response to identify any patented articles made or offered

28

for sale after the issuance of the patent.
7

Interrogatory No. 5 pertains to “secondary considerations of nonobviousness.” (5/15/13

2

Joint Letter at 8.) EA contends that Digital Reg has “provided only a bare-bones response that

3

wholly fails to meet its burden of producing evidence of secondary considerations, including

4

evidence of nexus to the alleged patented inventions at issue in this case.” Id. The burden of

5

proof as to the nexus resides with the patentee when the patentee “asserts that commercial success

6

supports its contention of nonobviousness.” Demaco Corp. v. F. Von Langsdorff Licensing Ltd.,

7

851 F.2d 1387, 1392 (Fed. Cir. 1988) This requires that “objective evidence should be considered

8

in the determination of nonobviousness.” Id.at 1392. Once the patentee has established the prima

9

facie case of nexus, the burden of coming forward with rebuttal evidence shifts to the challenger.

10

Id. at 1393. As noted above, EA did not provide a copy of Digital Reg’s responses, so the Court

11

United States District Court
Northern District of California

1

is unable to determine whether Digital Reg’s responses makes secondary considerations, such as

12

commercial success, of nonobviousness. Therefore, the Court cannot compel Digital Reg’s

13

supplemental responses at this time. Digital Reg, however, has a duty to supplement its responses

14

pursuant to Rule 26.

15
16

The Court GRANTS EA’s requests to compel amended responses to Common
Interrogatory Nos. 1-3, and DENIES EA’s request to compel amendment to Interrogatory No. 5.

17

2. Digital Reg’s Production of Documents from Prior Lawsuit

18

EA seeks to compel the production of documents from prior lawsuits relating the Patents-

19

in-Suit. (5/15/13 Joint Letter at 9.) EA acknowledges that Digital Reg has produced some

20

documents, but believes that the production was incomplete. Id. Digital Reg contends that it

21

approached its prior law firm and obtained all documents that were retained, and has produced all

22

of those documents. Id. at 10.

23

While Digital Reg is only required to produce those documents in its possession or

24

control, like the dispute regarding EA’s Rule 30(b)(6) deponent, this dispute was not included in

25

the April 12, 2013 Joint Letter. The last day to file a joint letter on other discovery disputes was

26

May 7, 2013. (See Stipulation Regarding Limited Extension of Fact Disc., Dkt. Nos. 328 & 337.)

27

The instant letter was filed on May 15, 2013, so these disputes are untimely.

28

The Court DENIES EA’s request to compel documents from prior lawsuits.
8

1

3. Document Production of Intellectual Profit LLC

2

EA seeks production of documents requested by way of third party subpoena to

3

Intellectual Profit LLC, “a company that acted as a broker for, and attempted to auction, the

4

patents-in-suit in April 2010” and currently acts as a “consultant to Digital Reg in efforts to

5

monetize patents, including in this litigation.” (5/15/13 Joint Letter at 10.) EA served a subpoena

6

to IP on January 3, 2013 “seeking documents relating to its role in attempting to monetize the

7

patents-in-suit.” EA’s requests the following relief:

8
9
10

United States District Court
Northern District of California

11
12

(a) a ruling that documents from Digital Reg’s prior lawsuit in the position of its
prior attorneys were within Digital Reg’s possession, custody, or control; (b) a
complete explanation for the authority on which the documents were destroyed, if
any; (c) a complete description of the destroyed materials; (d) an explanation of
the timing of when they were destroyed; (e) an extension of the discovery cut-off
to depose Digital Reg’s prior attorneys, if appropriate after review of Digital
Reg’s explanations to (b) – (d).

13

Id. at 9; see also Ex. H. EA contends that Intellectual Profit responded “that due to its ongoing

14

relationship as Digital Reg’s consultant, Digital Reg would produce documents on its behalf.”

15

(5/15/13 Joint Letter at 10.) “Digital Reg subsequently produced a total of only six documents

16

that allegedly constitute the entirety of the IP documents responsive to the subpoena, while at the

17

same time stating that there “may be” responsive emails that were not produced and not logged.”

18

Id. EA seeks an order “compelling production of all responsive documents and a privilege log for

19

any withheld document.” Id.

20

Digital Reg contends that the Court lacks jurisdiction to enforce the subpoena on the

21

grounds that it was issued in the U.S. District Court for the District of Delaware and must be

22

enforced by the court where the subpoena was issued. Id.at 10. Failure to comply with a

23

subpoena, without adequate excuse, is contempt of court. Fed. R. Civ. P. 45(e). The party seeking

24

discovery may seek enforcement “by filing an application for an order to show cause why a

25

contempt citation should not issue.” Cal. Prac. Guide Fed. Civ. Pro. Before Trial Ch. 11(IV)-F.

26

The application must be filed in the district court in which the subpoena was issued. Id.; see also

27

Steshenko v. McKay, C 09-5543 RS, 2012 WL 2589243 (N.D. Cal. July 3, 2012) (citing S.E.C. v.

28

CMKM Diamonds, Inc., 656 F.3d 829, 832 (9th Cir.2011) (“contention that this court has
9

1

jurisdiction to resolve disputes regarding the propriety of subpoenas issued under the authority of

2

other districts lacks merit.”). To the Court’s knowledge, EA did not initiate contempt proceedings

3

in the District of Delaware and now asks this Court to exercise authority that it does not possess.

4

Moreover, like EA’s request for relief regarding the production of documents from prior

5

lawsuits, this dispute was not included in the April 12, 2013 Joint Letter and so is untimely, as it

6

was not brought before the Court before the deadline to file a motion to compel pursuant to Civil

7

Local Rule 37-3, which was May 7, 2013.

8
9
10

United States District Court
Northern District of California

11

The Court DENIES EA’s requested for relief regarding the documents subpoenaed from
Intellectual Profit LLC.
IV. CONCLUSION
For the reasons set forth above, Digital Reg’s request that EA supplement its responses to

12

provide financial information is DENIED as to actual business records. EA, however, shall

13

amend its response to Request for Production No. 1 to state whether it has provided sufficient

14

non-privileged documents to fully respond to the request.

15

Digital Reg’s request that EA be compelled to amend its responses to selected

16

interrogatories is GRANTED IN PART AND DENIED IN PART, such that EA must only amend

17

its responses to Common Interrogatory No. 13 and Individual Interrogatory Nos. 7 and 8.

18

Digital Reg’s request to compel the production of additional Rule 30(b)(6) deponents is

19

DENIED, as it was outside the purview of the April 12, 2013 Joint Letter, and so was not properly

20

before the Court before the close of fact discovery.

21

EA’s request to compel Digital Reg’s amended interrogatory responses is GRANTED IN

22

PART AND DENIED IN PART, such that Digital Reg must only amend its responses to

23

Common Interrogatory Nos. 1-3. EA’s requests to compel documents from prior lawsuits is

24

DENIED. EA’s request for the production of documents from third party Intellectual Profit LLC

25

is DENIED as both untimely and not within the jurisdiction of this court, as the subpoena was

26

issued by the U.S. District Court for the District of Deleware.

27

All amended discovery responses shall be produced within 21 days of this order.

28

10

1
2
3
4

The parties shall meet and confer in good faith to resolve any outstanding disputes prior to
seeking further court intervention.
IT IS SO ORDERED.
DATE: September 30, 2013

___________________________
KANDIS A. WESTMORE
United States Magistrate Judge

5
6
7
8
9
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

11