BrightEdge Technologies, Inc. v. Searchmetrics, GmbH. et al

Filing 182

ORDER by Magistrate Judge Maria-Elena James finding as moot 169 Discovery Letter Brief; granting 170 Discovery Letter Brief. (rmm2S, COURT STAFF) (Filed on 11/8/2017)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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BRIGHTEDGE TECHNOLOGIES, INC.,

Case No. 14-cv-01009-HSG (MEJ)

Plaintiff,
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DISCOVERY ORDER

v.

Re: Dkt. Nos. 169, 170

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SEARCHMETRICS GMBH., et al.,
Defendants.

United States District Court
Northern District of California

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INTRODUCTION
Before the Court are two discovery letter briefs submitted by the parties. Having

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considered the parties’ arguments and the relevant legal authority, the Court ORDERS production

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of the 2017 version of Searchmetrics’ SugarCRM database, and all underlying documents

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referenced therein, for the following reasons.

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PROCEDURAL BACKGROUND
On October 17, 2017, Plaintiff BrightEdge Technologies Inc. (“BrightEdge”) and

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Defendants Searchmetrics GmbH and Searchmetrics, Inc. (collectively “Searchmetrics”) filed two

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Joint Discovery Dispute Letters with the Court. In the first letter, BrightEdge requested that the

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Court compel Searchmetrics to produce “all documents concerning sales, offers to sell, and

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attempted sales of Searchmetrics’[] products and the accused products”, given the information’s

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“relevance to infringement, willfulness, and damages.” Dkt. No. 169. In the second letter,

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BrightEdge asked that the Court compel production of Searchmetrics’ SugarCRM database, as it is

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“relevant to willfulness, non-obviousness, and damages.” Dkt. No. 170. Searchmetrics asked that

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the Court deny both of BrightEdge’s requests, stating that the information sought is not relevant.

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Dkt. Nos. 169, 170. Searchmetrics also argued that the first request is “overbroad, overly

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burdensome, [and] violates the relevancy and proportionality requirements of Fed. R. Civ. P.

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26(b)(1)”, and expressed concerns that fulfilling the second request would result in a violation of

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German privacy laws. Id.
On October 26, 2017, the Court held a hearing regarding this discovery dispute. October

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26, 2017 Minute Entry, Dkt. No. 177.
On November 2, 2017, the Superior Court of California for the County of Santa Clara

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issued an order on a similar discovery dispute in the parties’ trade secrets case. BrightEdge

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Technologies, Inc. v. Gabriel Martinez, et al., Case No. 2013-1-CV-256794 (Santa Clara County

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Superior Court). The Superior Court ordered Searchmetrics to produce the 2015 version of its
SugarCRM database, given production would be made subject to the adequately protective

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United States District Court
Northern District of California

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Confidentiality Order already in place in that case.
LEGAL STANDARD

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“Parties may obtain discovery regarding any nonprivileged matter that is relevant to any

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party’s claim or defense and proportional to the needs of the case . . . . Information within this

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scope of discovery need not be admissible in evidence to be discoverable.” Fed. R. Civ. P.

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26(b)(1). “Evidence is relevant if: (a) it has any tendency to make a fact more or less probable

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than it would be without the evidence; and (b) the fact is of consequence in determining the

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action.” Fed. R. Evid. 401. However, courts must limit discovery if the information sought “is

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unreasonably cumulative or duplicative, or can be obtained from some other source.” Fed. R. Civ.

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P. 26(b)(2)(C)(i).
DISCUSSION

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A.

Second Letter Brief Regarding Production of the SugarCRM Database (Dkt. No. 170)
Discovery should be allowed unless the information sought has “no conceivable bearing on

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the case.” First Fin. Sec., Inc. v. Jones, 2017 U.S. Dist. LEXIS 128194, at *4 (N.D. Cal. Aug. 11,

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2017) (citation omitted). This Court has already recognized that the requested information

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(contained in Searchmetrics’ SugarCRM database and the underlying documents referenced

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therein) is relevant to BrightEdge’s claims of willful infringement and to the calculation of

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damages in this action. Dkt. No. 56 at 5. This Court has also recognized that this information
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cannot be obtained elsewhere. Id. at 7. Additionally, at the October 26th hearing, BrightEdge

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stated that it is a common industry practice to produce this kind of database in this kind of

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litigation.

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However, Searchmetrics has again asserted that transmitting the database and other related

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documents to a United States company would violate German privacy law. Dkt. No. 170 at 5; see

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also Dkt. No. 48. Searchmetrics alleges that the database and related documents contain personal

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data, which German law bars from being transferred “to countries lacking the same levels of

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protection afforded in EU countries [– countries such as] the United States.” Dkt. No. 170 at 5.

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Still, “the party opposing discovery has the burden of showing that discovery should not be
allowed, and also has the burden of clarifying, explaining[,] and supporting its objections with

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United States District Court
Northern District of California

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competent evidence.” La. Pac. Corp. v. Money Mkt. 1 Inst’l Inv. Dealer, 285 F.R.D. 481, 485

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(N.D. Cal. 2012) (citations omitted); see DirectTV, Inc. v. Trone, 209 F.R.D. 455, 458 (C.D. Cal.

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2002); see also Oakes v. Halvorsen Mar. Ltd., 179 F.R.D. 281, 283 (C.D. Cal. 1998) (citation

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omitted). Searchmetrics has failed to do so. Searchmetrics has twice made this general assertion,

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but has not explained why the protective order already in place in this case would not be sufficient

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to protect the private information contained in the database and related documents.

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As this Court has already stated, even where a party seeks to prevent disclosure of

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documents based on foreign law, “it is well settled that such [foreign] statutes do not deprive an

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American court of the power to order a party subject to its jurisdiction to produce evidence even

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though the act of production may violate that statute.” Societe Nationale Industrielle Aerospatiale

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v. U. S. District Court, 482 U.S. 522, 544 n. 29 (1987) (citing Societe Internationale Pour

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Participations Industrielles et Commerciales, S.A. v. Rogers, 357 U.S. 197, 204-06 (1958)). This

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Court previously ruled in favor of disclosure on a similar Joint Discovery Dispute Letter in this

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case. Dkt. No. 56. While related to a broader set of requests, the requests listed in that letter

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included one for Searchmetrics’ SugarCRM database and the related documents. Dkt. No. 48 at 2.

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In that letter, Searchmetrics similarly asserted objections to production based on German privacy

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law. However, in its order, this Court applied the relevant balancing test (set forth in Restatement

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(Third) of Foreign Relations Law section 442(1)(c) (1987) and stated in Aerospatiale, 482 U.S. at
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544 n. 28 (1987 and deter
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7))
rmined that the balance weighed in f
favor of com
mpelling Sea
archmetrics

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to produce wha it had prev
p
at
viously withheld on the b
basis of inte
ernational pri
ivacy law.
Nothing has change Searchm
g
ed.
metrics’ priva concerns are address by the fa that
acy
s
sed
act

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pro
oduction of the SugarCR database and the und
t
RM
derlying docu
uments refer
renced therein will be

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sub
bject to the protective order already in place. Th
p
i
herefore, the Court ORD
DERS produ
uction of the

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Sug
garCRM dat
tabase and th underlyin document referenced therein.
he
ng
ts
d

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B.

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First Letter Brief Regarding Requests fo Productio Nos. 21-2 (Dkt. No. 169)
L
R
R
or
on
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.
At the October 26, 2017 hearing, BrightEdg counsel informed th Court tha the
O
ge’s
l
he
at

formation req
quested in th first joint letter could be found in the SugarCR database and the
he
RM
e
inf
und
derlying doc
cuments refe
erenced there
ein. October 26, 2017 M
r
Minute Entry Transcript of
y;

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United States District Court
Northern District of California

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Pro
oceedings Held on Octob 26, 2017 Dkt. No. 1 80 at 20:11ber
7,
-14. The pro
oduction req
quested in the
e

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firs letter would therefore be duplicative, and its d
st
duplicate pro
oduction is u
unnecessary.

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Ac
ccordingly, th request is MOOT.
he
s
CONCLU
USION

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Therefo the Cour ORDERS production of the 2017 version of S
ore,
rt
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n
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Searchmetric
cs’
Sug
garCRM dat
tabase and al underlying documents referenced therein.
ll
g
s

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S
RED.
IT IS SO ORDER

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Da
ated: Novemb 8, 2017
ber
___
__________
___________
__________
________
MA
ARIA-ELEN JAMES
NA
Un
nited States M
Magistrate Ju
udge

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