TechShop, Inc. v. Rasure et al

Filing 182

ORDER by Judge Haywood S. Gilliam, Jr. ON ( 135 , 137 ) MOTIONS IN LIMINE.(ndrS, COURT STAFF) (Filed on 5/8/2019)

Case 4:18-cv-01044-HSG Document 182 Filed 05/08/19 Page 1 of 6

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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TECHSHOP, INC.,
Plaintiff,

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v.

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ORDER ON MOTIONS IN LIMINE
Re: Dkt. Nos. 135, 137

DAN RASURE, et al.,
Defendants.

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United States District Court
Northern District of California

Case No. 18-cv-01044-HSG

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In this case, Plaintiff TechShop (through its bankruptcy trustee) asserts that Defendants

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Dan Rasure and two entities he formed infringed upon its service marks in connection with the

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name of makerspace services. See Joint Proposed Statement of the Case, Dkt. No. 153 at 3.

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Defendants counterclaimed, contending that Plaintiff defrauded them. See id.
At the April 30 pretrial conference, the Court directed Defendants to submit additional

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briefing on specified issues and informed the parties that it would issue a written order resolving

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the pending motions in limine. Having received the supplemental responses, the Court rules on

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the remaining motions in limine.

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I.

PLAINTIFF’S MOTION IN LIMINE NO. 1 RE: DOCUMENTS NOT PRODUCED
DURING DISCOVERY/WITNESSES DISCLOSED
Plaintiff moved in limine “to preclude Defendants from offering evidence of documents

not properly produced during discovery and calling witnesses not disclosed.” See Dkt. No. 135 at
1. Plaintiff’s initial motion pertained to approximately 3,700 pages of documents and the
testimony of Defendants’ witness Michael Hilberman. See id. at 2–3. In their response,
Defendants stated that they were “willing to withdraw” all of the objected-to items except for a
video of the January 19, 2018 Maker Nexus town hall meeting and the testimony of Mr.

Case 4:18-cv-01044-HSG Document 182 Filed 05/08/19 Page 2 of 6

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Hilberman. See Dkt. No. 149 at 1.1 At the pretrial conference, the Court directed Defendants to

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submit a declaration explaining how they obtained the video and told the parties that it would

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issue a written order as to both the video and Mr. Hilberman’s testimony.

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A.

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Federal Rule of Civil Procedure 26 provides that “a party must, without awaiting a

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United States District Court
Northern District of California

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Legal Standard

discovery request, provide to the other parties:”
(i) the name and, if known, the address and telephone number of each
individual likely to have discoverable information—along with the
subjects of that information—that the disclosing party may use to
support its claims or defenses, unless the use would be solely for
impeachment;
(ii) a copy—or a description by category and location—of all
documents, electronically stored information, and tangible things that
the disclosing party has in its possession, custody, or control and may
use to support its claims or defenses, unless the use would be solely
for impeachment.

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Fed. R. Civ. P. 26(a). Further,
[a] party who has made a disclosure under Rule 26(a)—or who has
responded to an interrogatory, request for production, or request for
admission—must supplement or correct its disclosure or response:
(A) in a timely manner if the party learns that in some material respect
the disclosure or response is incomplete or incorrect, and if the
additional or corrective information has not otherwise been made
known to the other parties during the discovery process or in
writing[.]

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Fed. R. Civ. P. 26(e)(1). As a sanction for failing to make a required initial or supplemental

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disclosure, “the party is not allowed to use that information or witness to supply evidence on a

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motion, at a hearing, or at a trial, unless the failure was substantially justified or is harmless.” Fed.

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R. Civ. P. 37(c)(1). “The party facing sanctions bears the burden of proving that its failure to

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disclose the required information was substantially justified or is harmless.” R & R Sails, Inc. v.

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Ins. Co. of Pa., 673 F.3d 1240, 1246 (9th Cir. 2012).

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B.

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Plaintiff moved to preclude the introduction of the Maker Nexus town hall meeting video

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Maker Nexus Video

because Defendants failed to disclose that they intended to use the video to support their claims or

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Defendants also declined to withdraw documents relating to the Odyssey Expo event. At the
pretrial conference, the Court orally denied Plaintiff’s motion to preclude these documents
because they were created after the discovery cut-off date and there was no prejudice to Plaintiff.
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Case 4:18-cv-01044-HSG Document 182 Filed 05/08/19 Page 3 of 6

defenses.2 Defendants asserted in their opposition that their “late production” of the Maker Nexus

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video was “substantially justified” and harmless because they “requested its production during

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discovery” and “Plaintiff knew about this video both from Defendants’ discovery requests and

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because its counsel was present at the meeting and can be seen speaking in the video.” See Dkt.

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No. 149 at 5. Defendants represented at the pre-trial conference that the video was not publicly

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available during the fact discovery period but was later located online. However, following the

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pre-trial conference, counsel for Defendants submitted a sworn declaration in which she stated that

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her “records show that I downloaded the Maker Nexus Video on September 15, 2018 at 10:40

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p.m.” and that she viewed portions of the video around that time. See Dkt. No. 177 ¶ 15. Counsel

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“did not recall that [she] had ever obtained a copy of the Maker Nexus Video until shortly before

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United States District Court
Northern District of California

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the parties’ trial exhibit lists were due.” Id. But counsel avers that she served a discovery request

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on September 13 on Plaintiff seeking this video and that Plaintiff responded on October 15 that it

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did not possess the video. See id. ¶¶ 10, 16. Counsel provides no explanation for why she failed

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to disclose or otherwise notify Plaintiff that she obtained the video just a few days after she asked

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for it in a discovery request.
Because Defendants have not demonstrated that their failure to timely disclose the video

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was substantially justified or harmless, the Court GRANTS the motion to exclude the Maker

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Nexus video.

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C.

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Plaintiff moved to preclude Defendants from calling Michael Hilberman as a witness

Testimony of Mr. Hilberman

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because he had not been identified as a potential witness prior to his name appearing on the

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witness list. See Dkt. No. 135 at 3. Defendants responded that Mr. Hilberman’s “name appears

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on documents produced by both parties” and that he was “Plaintiff’s CFO prior to the bankruptcy

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filing and was involved in TechShop’s negotiations with Mr. Rasure.” Dkt. No. 149 at 5.

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According to Defendants, because Mr. Hilberman’s involvement with the underlying events was

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Plaintiff separately moved to preclude introduction of the Maker Nexus video on relevance and
unfair prejudice grounds, see Dkt. No. 138; the Court denied this motion on the record during the
pretrial conference.
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known to Plaintiff, they “were not obligated to supplement their Initial Disclosures to add his

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name, and there is no prejudice to Plaintiff in Defendants calling him as a trial witness.” See id.
The Court disagrees. Sporadic references to Mr. Hilberman in (at most) a few dozen of the

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documents produced in this case is insufficient to overcome Defendants’ supplemental disclosure

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obligation. Cf. Nuance Commc’ns, Inc. v. ABBYY Software House, No. C 08-02912 JSW MEJ,

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2012 WL 2838431, at *2 (N.D. Cal. July 10, 2012) (noting that “merely mentioning the

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individual’s name at a deposition or in a discovery response may not be enough to put the other

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party on notice that the individual is being disclosed as a trial witness”); Ollier v. Sweetwater

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Union High Sch. Dist., 267 F.R.D. 339, 343 (S.D. Cal. 2010) (“Certainly the mere mention of a

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name in a deposition is insufficient to give notice to the opposing party that defendants intend to

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United States District Court
Northern District of California

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present that person at trial.”). Nor does pointing out that Mr. Hilberman was present for the events

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underlying this action meet Defendants’ burden to show that their failure to disclose was

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substantially justified or harmless. Accordingly, the Court GRANTS Plaintiff’s motion to

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exclude Mr. Hilberman as a witness.

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II.

PLAINTIFF’S MOTION IN LIMINE NO. 2 RE: DEFENDANTS’ FRAUD
ALLEGATIONS
Plaintiff moved in limine to preclude Defendants from offering evidence of fraud, for

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essentially the same reasons as were rejected in its motion to dismiss. Compare Dkt. No. 137
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(motion in limine) with Dkt. No. 46 (motion to dismiss). At the pre-trial conference, Plaintiff
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argued for the first time that Rules 26 and 37 required excluding the proffered evidence of
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damages from the alleged fraud because Defendants did not provide a “computation of damages.”

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Given that Defendants had not previously heard this argument, the Court gave them an
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opportunity to respond in writing. See Dkt. No. 174.
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Rule 26 requires a party to provide “a computation of each category of damages claimed

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by the disclosing party—who must also make available for inspection and copying as under Rule
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34 the documents or other evidentiary material, unless privileged or protected from disclosure, on
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which each computation is based, including materials bearing on the nature and extent of injuries
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suffered.” See Fed. R. Civ. P. 26(a)(1)(A)(iii). “If a party fails to provide information . . . as

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Case 4:18-cv-01044-HSG Document 182 Filed 05/08/19 Page 5 of 6

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required by Rule 26(a) or (e), the party is not allowed to use that information or witness to supply

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evidence on a motion, at a hearing, or at a trial, unless the failure was substantially justified or is

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harmless.” Fed. R. Civ. P. 37(c)(1). “The party facing sanctions bears the burden of proving that

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its failure to disclose the required information was substantially justified or is harmless.” R & R

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Sails, Inc., 673 F.3d at 1246.
Defendants assert that their failure to provide a computation of damages was harmless

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because they provided an itemized list of the alleged damages in the counterclaim itself. See Dkt.

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No. 174 at 3 (citing Dkt. No. 42 ¶¶ 51, 53–55, 58, 68). Defendants also contend that the failure

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was harmless because they produced the underlying documents and Plaintiff had an opportunity to
conduct discovery into the fraud counterclaim, including the damages calculation, but did not do

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United States District Court
Northern District of California

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so (and did not raise any Rule 26 objection until the pretrial conference). See Dkt. No. 174 at 2–3.
Under the circumstances of this case, the Court finds that, even assuming arguendo that

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Defendants failed to disclose a computation of damages as required by Rule 26, any such failure

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was harmless. Plaintiff had clear notice of the fraud damage claims through Defendants’

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counterclaim, which lists the factual basis and dollar amount of each alleged source of damage.

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See Dkt. No. 42 ¶¶ 51, 53–55, 58, 68. And Plaintiff had an opportunity to conduct discovery

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regarding Defendants’ damage estimates but appears not to have done so. Plaintiff’s argument

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appears to be an eleventh-hour sandbag attempt, given the complete lack of diligence as to this

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issue during discovery. Excluding the evidence of damages would be equivalent to granting

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Plaintiff’s previously-denied motion to dismiss, and the Court DENIES Plaintiff’s motion to

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preclude evidence of the alleged fraud.

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Case 4:18-cv-01044-HSG Document 182 Filed 05/08/19 Page 6 of 6

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III.

CONCLUSION
For the reasons stated above, the Court GRANTS Plaintiff’s motion in limine to exclude

the Maker Nexus video, GRANTS Plaintiff’s motion in limine to exclude Mr. Hilberman as a
witness, and DENIES Plaintiff’s motion in limine to preclude evidence of the alleged fraud.

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IT IS SO ORDERED.
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Dated: 5/8/2019
______________________________________
HAYWOOD S. GILLIAM, JR.
United States District Judge

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United States District Court
Northern District of California

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