Interserve, Inc. et al v. Fusion Garage PTE. LTD

Filing 183

Reply Memorandum re 164 MOTION to Compel Withheld Information and Documents filed byCrunchPad, Inc., Interserve, Inc.. (Attachments: # 1 Scherb Reply Declaration)(Scherb, Matthew) (Filed on 9/30/2010)

Interserve, Inc. et al v. Fusion Garage PTE. LTD

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Andrew P. Bridges (SBN: 122761) [e-mail] David S. Bloch (SBN: 184530) [e-mail] Matthew Scherb (SBN: 237461) [e-mail] WINSTON & STRAWN LLP 101 California Street, 39th Floor San Francisco, CA 94111-5802 Telephone: [phone] Facsimile: [phone] Attorneys for Plaintiffs TECHCRUNCH, INC. and CRUNCHPAD, INC. UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION TECHCRUNCH, INC., a Delaware corporation, ) and CRUNCHPAD, INC., a Delaware ) corporation, ) ) Plaintiffs, ) ) vs. ) ) FUSION GARAGE PTE. LTD., a Singapore ) company, ) ) Defendant. ) ) ) Case No. C 09-cv-5812 RS (PVT) PLAINTIFFS' REPLY IN SUPPORT OF THEIR MOTION TO COMPEL PRODUCTION OF WITHHELD INFORMATION AND DOCUMENTS Date: Time: Place: October 12, 2010 10:00 a.m. Courtroom 5, 4th Floor, San Jose

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Winston & Strawn LLP

Hon. Patricia V. Trumbull

PLAINTIFFS' REPLY IN SUPPORT OF THEIR TO MOTION TO COMPEL ­ Case No. 09-CV-5812 RS (PVT) SF:292522.9

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TABLE OF CONTENTS Page I. II. INTRODUCTION ...............................................................................................................1 ARGUMENT .......................................................................................................................2 A. Fusion Garage Concedes that its Pending Protective Order Motion is Moot and Offers No Evidence that Its Source Code or Other "Proprietary" or "Technical" Information is a Trade Secret Worthy of Court Protection. ................2 Fusion Garage's Source Code is Relevant and Not a Trade Secret, and the Court Should Order Its Production. .........................................................................3 Fusion Garage Cannot Avoid Producing Relevant Technical Documents Simply Because It Thinks Plaintiffs Already Have Enough Evidence to Prove Their Case. .....................................................................................................6 1. 2. Plaintiffs Seek Relevant, Discoverable Information. ...................................6 Fusion Garage Cannot Limit Discovery by Claiming that Plaintiffs Can Already Sufficiently Prove Their Case: Plaintiffs are Entitled to Prove Both Liability and Damages with All Appropriately Discoverable Evidence.................................................................................9

B. C.

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The Protective Order is Sufficient to Address Defendant's Concerns of Disclosure. .............................................................................................................11

CONCLUSION ..................................................................................................................12

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TABLE OF AUTHORITIES CASES PAGE(S)

Autotech Tech. Ltd. P'ship v. Automationdirect.com, Inc., 249 F.R.D. 530 (N.D. Ill. 2008) .................................................................................................9 Charles O. Bradley Trust v. Zenith Capital LLC, No. 04-2239, 2005 WL 1030218 (N.D. Cal. May 3, 2005) (Chen, M.J.)..................................4 Creative Gifts, Inc. v. UFO, 183 F.R.D. 568 (D.N.M. 1998) ..................................................................................................2 Drdlik v. Ulrich, 203 Cal. App. 2d 360 (1962) .....................................................................................................7 Echostar Satellite LLC v. Freetech, Inc., No. 07-6124, slip. op. (N.D. Cal. May 18, 2009) (Seeborg, M.J.) ..........................................11 Fed Open Mkt. Comm. of Fed. Reserve Sys. v. Merrill, 443 U.S. 340 (1979) .................................................................................................................11 Gherman v. Colburn, 72 Cal. App. 3d 554 (1977) .......................................................................................................7 Hickman v. Taylor, 329 U.S. 495 (1947) .................................................................................................................10 Humphreys v. Regents of University of Cal., No. 04-38 08, 2006 WL 870963 (N.D. Cal. Apr. 3, 2006) (Illston, J.) ...................................10 i4i Limited Partnership v. Microsoft Corp., 670 F. Supp. 2d 568 (E.D. Tex. 2009) .......................................................................................5 JustMed, Inc. v. Byce, 600 F.3d 1118 (9th Cir. 2010) ...................................................................................................5 Nat'l Acad. of Recording Arts & Scis., Inc. v. On Point Events, LP, 256 F.R.D. 678 (C.D. Cal. 2009) ...............................................................................................2 Philip M. Adams & Assoc., LLC v. Winbond Elecs. Corp., No. 05-64, 2010 WL 2977228 (D. Utah July 21, 2010) ........................................................4, 5 Urbina v. Goodyear Tire & Rubber Co., No. 07-3705, 2009 WL 481655 (C.D. Cal. Feb 23, 2009) ......................................................10 Viacom Int'l Inc. v. Youtube Inc., 253 F.R.D. 256 (S.D.N.Y. 2008) ...............................................................................................5 Wilson v. Brown, 96 Cal. App. 140 (1929) ............................................................................................................7 OTHER AUTHORITIES Fed. R. Civ. P. 26 .......................................................................................................................2, 10 ii
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I.

INTRODUCTION Although Fusion Garage's opposition to Plaintiffs' motion to compel (Dkt. No. 164)

discusses the same source code and other allegedly proprietary information at issue in its "trade secret" protective order motion (Dkt. No. 93), it ignores the fact that the "business ideas" claim that formed the basis of Fusion Garage's earlier motion is no longer in the case. Nor has Fusion Garage produced any evidence with its opposition to support the claim that its source code or other proprietary information is itself a trade secret. In fact, it now appears that Fusion Garage's source code should be in the public domain, and should have been disclosed months ago, given the code's derivation from code subject to the GNU General Public License (the "GPL license") and its opensource status. Essentially conceding that its protective order motion is moot, Fusion Garage has quietly shifted its focus. It now argues, without basis, that the information Plaintiffs seek is irrelevant. It also argues that Fusion Garage has already produced enough materials during discovery for TechCrunch and CrunchPad to prove their case. It does not follow, however, that Fusion Garage therefore should produce nothing more. Fusion Garage is withholding documents that (for example) mention the JooJoo and TechCrunch or CrunchPad (RFP 40), or mention the JooJoo and date from before the parties' breakup (RFP 53). Plaintiffs' requests are wholly appropriate under the Federal Rules. Plaintiffs have sought full discovery for months in the face of two successive protective order motions from Fusion Garage. There is no longer a misappropriation of business ideas claim, Fusion Garage has conceded that its latest protective order motion is moot, and yet it still resists making a full production of relevant and responsive documents. There is no basis for continued delay. The Court should deny the outstanding protective order motion and grant Plaintiffs' motion to compel. // // // // 1
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II.

ARGUMENT A. Fusion Garage Concedes that its Pending Protective Order Motion is Moot and Offers No Evidence that Its Source Code or Other "Proprietary" or "Technical" Information is a Trade Secret Worthy of Court Protection.

Fusion Garage does not argue that its protective order motion is still viable now that the Court has dismissed Plaintiffs' claim for misappropriation of business ideas. Moreover, Fusion Garage has failed to articulate, as it must, what its trade secrets are and why they` deserve this Court's special protection against any form of disclosure, even under an "Attorneys Eyes Only" restriction. (See Dkt. No. 35 (stipulated protective order).) True, Fusion Garage points to its source code. But it does not clearly articulate any other trade secrets. And now, it appears that even Fusion Garage's source code cannot be a trade secret. Fusion Garage's allegedly proprietary source code is in fact based on code authored under the GPL license. The GPL license (see Declaration of Matthew Scherb in Support of Plaintiffs' Reply ("Scherb Reply Decl.") Ex. A) requires that any source code released under the GPL be publicly disclosed. Fusion Garage has acknowledged enough, promising a computer code writer and open-source advocate who asked to see Fusion Garage's code: "We will make the source release available once we feel we are ready to do so and also having the resources to get this sorted out and organized for publication." (Scherb Reply Decl. Ex. B.) This is utterly inconsistent with claiming source code as a trade secret. The burden is on Fusion Garage, as the party resisting discovery, to show that the information at issue "is a `trade secret or other confidential research, development, or commercial information' under Rule 26, and that its disclosure would be harmful to the party's interest in the property." Nat'l Acad. of Recording Arts & Scis., Inc. v. On Point Events, LP, 256 F.R.D. 678, 681 (C.D. Cal. 2009). Fusion Garage "has not presented any declarations from its officers or employees supporting its claim that the information sought in the remaining interrogatories and document requests is a `trade secret'" or that it "has taken reasonable steps to assure the confidentiality of this information and to prevent its disclosure to third parties," as required. Id. at 683. Conclusory arguments are insufficient to establish that requested documents merit protection. Creative Gifts, Inc. v. UFO, 183 F.R.D. 568, 571 (D.N.M. 1998). It further has failed to explain why it would suffer harm from disclosure of its alleged trade secrets under the stringent "Attorneys' Eyes Only" 2
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protective order in this case. B. Fusion Garage's Source Code is Relevant and Not a Trade Secret, and the Court Should Order Its Production.

The only information that Fusion Garage specifically identifies as its proprietary trade secret information, and the only information it specifically argues lacks relevance to this case, is its source code. The source code, however, is not a trade secret and is relevant to Plaintiffs' claims. To start with, Fusion Garage has not shown that its source code is a trade secret. To the contrary, it appears Fusion Garage's source code is based on code authored under the GPL (GNU General Public Library) license. The GPL license (see Scherb Reply Decl. Ex. A) requires that all code based upon code released under the GPL be made public. Recent news stories show that Fusion Garage's code is based on GPL code and should be publicly disclosed. Fusion Garage conceded as much in a publicly posted message to an open source advocate: Dear Sir, we are still actively making changes to the joojoo software. We will make the source release available once we feel we are ready to do so and also having the resources to get this sorted out and organized for publication. We seek your kind understanding on our position and appreciate your patience on this. Thank you. Best Regards joojoo Support Team (Scherb Reply Decl. Ex. B.) The position Fusion Garage took in this message is utterly inconsistent with maintaining its source code as a trade secret. Fusion Garage has failed to disclose this significant and extremely relevant fact to the Court. Meanwhile, Fusion Garage's source code, and changes to it, will show the parties' joint development of the CrunchPad and the transformation of the CrunchPad into the JooJoo, once Fusion Garage chose to abandon the joint venture. It will contain comments or elements that may reveal use of the term "JooJoo" in mid-2009 or earlier, corroborating Plaintiffs' account of Fusion Garage's betrayal. It will also contain comments that may reveal that a feature or tweak originated with Mr. Monier or other of Plaintiffs' personnel, corroborating their account of their contributions to the CrunchPad software. Mr. Monier's technical documents, which Plaintiffs already have 3
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produced, show that Mr. Monier contributed substantial technical expertise to the development of the CrunchPad software. Further, changes to the source code may be important to damages discovery, and there is no reason to postpone damages discovery, particularly in light of the Court's ruling on the preliminary injunction motion that Plaintiffs are likely to establish Fusion Garage's breach of fiduciary duty. Dkt. No. 162; see Charles O. Bradley Trust v. Zenith Capital LLC, No. 04-2239, 2005 WL 1030218, at *3 (N.D. Cal. May 3, 2005) (ordering the production of financial/damages documents "under a strict protective order") (Chen, M.J.). If Fusion Garage continues to contend that "there is currently no new version of the JooJoo being offered for sale" and thus concedes that Plaintiffs could claim profits related to all JooJoo versions, then perhaps this particular basis for discovery would be less strong. But Fusion Garage's "current" contentions are subject to change and, as discussed, there are several other valid bases for source code discovery. Fusion Garage does not deny that its source code would reveal the information that Plaintiffs seek. In fact, it concedes that source code comments can disclose "who created the source code and when." (Opp. at 14; emphasis added.) Instead, Fusion Garage argues that this is not a case about source code ownership and that, after a point in 2009, Plaintiffs did not write source code for the CrunchPad. Fusion Garage misses the point entirely. This is a case of breach of fiduciary duty and fraud. Evidence of Fusion Garage's two-timing TechCrunch and CrunchPad, of its use in the JooJoo of code developed in the course of the joint venture ­ even code Fusion Garage itself wrote during the joint venture, and of its concealed intentions and false statements, is all very relevant to the case. The JooJoo source code may contain evidence, or information that will lead to discoverable evidence, on those and other important points. Fusion Garage fails to cite any case holding that a court should deny discovery of source code for these purposes. Instead, Fusion Garage tries to distinguish the cases that Plaintiffs used to illustrate how source code and comments can contain relevant, discoverable information. Fusion Garage argues that none of those cases specifically ordered source code production, but this distinction does not matter, as discussed below. In Philip M. Adams & Assoc., LLC v. Winbond Elecs. Corp., No. 05-64, 2010 WL 2977228 4
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(D. Utah July 21, 2010), the court considered sanctions against the defendant because the defendant failed to retain the source code. Id. at *1. The court found that the defendant should have had the original code, noted that comments in the original code would have been relevant, and allowed the jury to draw inferences from the loss. Id. at *2. Though Adams did not order production, it did impose sanctions, a harsher result. The Ninth Circuit's decision in JustMed, Inc. v. Byce, 600 F.3d 1118 (9th Cir. 2010) may not have ordered production, but a state court's temporary restraining order before the case was removed to federal court did just that. Id. at 1123. Also, contrary to Fusion Garage's assertions, the dispute was not over who wrote the code and when, but rather whether the writer was legally an employee of JustMed. Id. at 1120, 1125 fn.4. Finally, in i4i Limited Partnership v. Microsoft Corp., 670 F. Supp. 2d 568, 586 (E.D. Tex. 2009), there was no need for the court to order production of source code as the expert had already examined the code and testified about it at trial. i4i stands for the proposition that source code itself (not only source code comments, as Fusion Garage suggests in its footnote on page 14 of its opposition brief) can show the dates when the code was modified. Id. The only other case that Fusion Garage cites concerning source code is Viacom Int'l Inc. v. YouTube Inc., 253 F.R.D. 256 (S.D.N.Y. 2008). Viacom declined to order production of source code because Viacom's basis to obtain it was wholly speculative. Viacom claimed that the source code would show that YouTube purposefully designed its search tool to distinguish between infringing and noninfringing material. Id. at 259. YouTube submitted an affidavit that this was false, and that such a design was not even possible without the active participation of rights-holders. Id. The court required a plausible showing by Viacom that YouTube was lying. Id. at 260. Viacom also speculated that the source code might be adapted in the future to filter out infringing content. The court, however, noted that while whether such a feature could exist might be relevant, the idea that Viacom needed YouTube's code, which did not contain such a filtering program, in order to show that it could have been done some other way was too speculative. Id. at 260-61. Here, discovery has already produced evidence that Fusion Garage likely breached its fiduciary duty to Plaintiffs by working on development of the JooJoo tablet while it was in a joint 5
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venture with Plaintiffs to develop the CrunchPad. This Court has already found likely success of the claim for breach of fiduciary duty. (Dkt. No. 162.) Information in the source code bearing on the dates when Fusion Garage was working on the JooJoo, whether Fusion Garage used in the JooJoo any code that was developed during the CrunchPad joint venture, and what other features or functions the JooJoo owed to the CrunchPad joint venture is clearly relevant to when and the extent to which Fusion Garage breached its fiduciary duty. Because Fusion Garage's source code is not a trade secret and because it is relevant, the court should order its production. C. Fusion Garage Cannot Avoid Producing Relevant Technical Documents Simply Because It Thinks Plaintiffs Already Have Enough Evidence to Prove Their Case.

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Not only should the Court order production of source code, it should order production of the other technical documents Fusion Garage continues to withhold. Plaintiffs posed many of the discovery requests that seek these documents through Court-ordered expedited discovery in January of this year. Plaintiffs posed the other requests at issue in June. Fusion Garage has produced some documents in response to some of those requests. It is time for Fusion Garage to produce all responsive documents to all requests, regardless of whether they contain proprietary information. Fusion Garage offers two arguments against producing technical documents. First, Fusion Garage argues that technical documents lack relevance because, it claims, Plaintiffs played no role in the technical development of the CrunchPad. Second, Fusion Garage asserts that Plaintiffs can already prove their case without these documents and so may not seek them, or presumably any other documents, in discovery. Fusion Garage claims that TechCrunch and CrunchPad could not argue that "they would be unable to prove their case without discovery into Fusion Garage's proprietary information." (Opp. at 11.) Both of Fusion Garage's arguments fail. Even if Fusion Garage stipulates to liability for its breach of fiduciary duty, which Plaintiffs invite Fusion Garage to do, the documents are relevant to damages calculations. 1. Plaintiffs Seek Relevant, Discoverable Information.

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understanding the relationship of the JooJoo to the parties' joint venture, as well as Fusion Garage's fraudulent representations that everything was "on track" until days before it pulled the plug on the CrunchPad collaboration and announced the JooJoo as its solo effort. Fusion Garage disputes the relevance of technical information pertaining to the JooJoo. It argues, based on its own cherrypicked evidence, that Plaintiffs contributed nothing to the technical development of the CrunchPad and concludes that therefore the technical documents they seek must be irrelevant. This argument entirely misses the point. What matters is the relationship between the JooJoo and the CrunchPad joint venture, including the work that Fusion Garage had done within the joint venture that Fusion Garage usurped to its own benefit. "[W]here one partner excludes the other, repudiates the very existence of the partnership and converts all of the partnership assets, the victim may sue for damages." Gherman v. Colburn, 72 Cal. App. 3d 554, 557 (1977). It does not matter that the parties' contributions were different in kind; indeed, it is very common that venturers contribute different things to their joint enterprise. See, e.g., Drdlik v. Ulrich, 203 Cal. App. 2d 360 (1962) (contribution of money versus services; collecting cases); Wilson v. Brown, 96 Cal. App. 140 (1929) (in a real estate venture, defendant contributed financing while plaintiff worked to sell the subdivided plots; defendant cut out plaintiff, and plaintiff successfully recovered both cash from the proceeds of sales and also some of the unsold plots). Not only is Fusion Garage's argument on that point a red herring, it is also factually wrong. Fusion Garage itself admits that Plaintiffs made technical contributions to the CrunchPad project that Fusion Garage has now repudiated. On February 4, 2009, Fusion Garage wrote on its blog: The collaboration with the Crunchpad project happened as a result of meetings we had with Mike Arrington and co, subsequent to TC50. We worked closely with Louis Monier in getting the software in shape for the hardware prototype B. We continue to work with them in getting the software in shape to make crunchpad a easy to use device. This is where we stand as of prototype-B: (Details over at TechCrunch's update) (Scherb Reply Decl. Ex. C (emphasis added).) Several documents corroborate that Mr. Monier did in fact work with Fusion Garage to "get[] the software in shape." For example, Mr. Monier prepared a detailed, 10-page "Software plan for version 1" that outlines features and discusses methodology and resource time and personnel requirements. Id. Ex. D. Also, Mr. Monier sent Mr. Rathakrishnan a lengthy "product draft" for the "software side" ­ a compilation of Mr. Monier's thoughts about 7
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how the web tablet software should look, feel, and operate. Id. Ex. E. Mr. Rathakrishnan understands that the software on his company's JooJoo, the one-time CrunchPad, derives from Plaintiffs' contributions. He remarked in May 2009 that Prototype C was part of "the evolution of the collaboration with techcrunch . . . prototype b then prototype c." (Scherb Reply Decl. Ex. F.) Further, Mr. Rathakrishnan, back in April 2009, explained to a friend that Fusion Garage was only "kind of" responsible for product design on that prototype. Id. Ex. G. The software in Prototype C then led to the software now included with the JooJoo. Fusion Garage's insistence now that Plaintiffs offered no technical design advice does not square with its previous public statements. Fusion Garage also fails to mention Mr. Cubrilovic, whom Plaintiffs tasked with software development in August 2009. Instead, Fusion Garage misdirects the spotlight to Ms. Harde, Mr. Arrington, and Mr. Kindle. It cites deposition testimony and complains each failed to provide detailed technical direction (Opp. at 9-10), but its complaints have no bite. Ms. Harde is TechCrunch's CEO and CrunchPad's acting CFO. Her primary role was executive and financial, and Plaintiffs have never argued that she was providing detailed technical direction. Mr. Arrington is the founder and Co-Editor of TechCrunch and CrunchPad's CEO. He envisioned the CrunchPad and devised its features, and was involved in decisions concerning the CrunchPad's hardware and software, but he has never claimed to be a code writer or a hardware engineer. (See Arrington Dep. Tr. at 139:1-7 (Scherb Reply Decl. Ex. H).) Mr. Kindle, as distinguished from Mr. Cubrilovic, did not work with software, but was, with Mr. Rathakrishnan's approval, in charge of hardware design and manufacturing. (Kindle Dep. Tr. at 17:17 to 18:3; 71:22 to 72:4 (Scherb Reply Decl. Ex. I).) Mr. Kindle provided detailed technical guidance, for example, on "thermals" related to the CrunchPad. (Scherb Reply Decl. Ex. J.) He also provided the high level management that Fusion Garage and Plaintiffs asked him to provide. Id. Ex. K. Plaintiffs made detailed technical contributions. But even if they had not, TechCrunch and CrunchPad still are entitled to obtain technical and proprietary information from Fusion Garage during discovery for a variety of important purposes in the litigation. For example, the documents may show when and how Fusion Garage worked with secret partners, such as its manufacturer 8
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Gigabyte, against the interests of the parties' joint venture. Fusion Garage was working with Gigabyte well ahead of the breakup with Plaintiffs, and Plaintiffs therefore are entitled to all communications with Gigabyte, regardless of whether those communications contain proprietary information. (See Mot. Appendix A, RFPs 54-55 (seeking various communications with Gigabyte).) As another example, proprietary technical documents that mention both the JooJoo and TechCrunch or CrunchPad (RFP 40) are highly relevant and Fusion Garage must produce them, regardless of whether they contain alleged "trade secrets." Finally, Fusion Garage's reliance on Autotech Tech. Ltd. P'ship v. Automationdirect.com, Inc., 249 F.R.D. 530 (N.D. Ill. 2008), undermines rather than supports its position. In Autotech, the court found that documents related to distribution of the defendant's competing product were relevant to a breach of contract claim related to "best efforts" to distribute the plaintiff's product. Id. at 534. The court ordered production of documents related to the distribution of defendant's touchscreen and not documents related to development of defendant's touchscreen because the contract terms specifically applied only to distribution. Id. In this case, the breach of fiduciary claim, which is not tied to a written contract, relates to the development by Fusion Garage of a competing product during the time it was supposedly developing the parties' joint product. The extent to which Fusion Garage converted that joint venture to its own exclusive benefit, and the extent that Fusion Garage lied about its intentions and its activities, is at the core of the case. 2. Fusion Garage Cannot Limit Discovery by Claiming that Plaintiffs Can Already Sufficiently Prove Their Case: Plaintiffs are Entitled to Prove Both Liability and Damages with All Appropriately Discoverable Evidence.

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Aside from its straw-man relevance argument, Fusion Garage's only other bulwark against production of its technical documents and information is that Plaintiffs already have enough materials to "prove their case without discovery into Fusion Garage's proprietary information" (Opp. at 11).1 Plaintiffs are gratified that Fusion Garage effectively concedes liability with that argument, but even that concession cannot avoid complete discovery. Fusion Garage has not argued, for instance, that producing responsive documents, including the source code, would be unduly burdensome. On the contrary, Fusion Garage's attorneys have already collected the requested documents. All that remains is production. 9
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Fusion Garage offers no support for its view that a defendant still vigorously litigating its defense of liability and damages may impose unilateral restrictions on discovery upon suggesting that the plaintiff has enough evidence to prove its case. Such a standard would turn discovery on its head. Discovery under the Federal Rules is "accorded a broad and liberal treatment." Hickman v. Taylor, 329 U.S. 495, 507 (1947). Rule 26 provides that "[p]arties may obtain discovery regarding any matter, not privileged, that is relevant to the claim or defense of any party. ... Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence." Fed. R. Civ. P. 26(b)(1). Further, discovery of relevant trade secrets information is commonplace, especially when the parties protect against potential disclosures with a protective order. Urbina v. Goodyear Tire & Rubber Co., No. 07-3705, 2009 WL 481655, at *5 (C.D. Cal. Feb. 23, 2009). It is not for Fusion Garage to decide what theories of the case Plaintiffs choose to pursue, nor can defendants limit the scope of discovery because there is already some evidence of their wrongdoing. See Humphreys v. Regents of University of Cal., No. 04-38 08, 2006 WL 870963, at *2 (N.D. Cal. Apr. 3, 2006) (Illston, J.) ("defendants are not allowed to limit discovery based merely upon their theory of the case"). Moreover, Fusion Garage, while stating that it has agreed to produce some documents responsive to seven of the contested requests, also states that it has withheld an unknown number of responsive but otherwise uncharacterized documents. (Opp. at 12) Thus, Fusion Garage appears to be withholding documents, for example, that mention both the JooJoo and TechCrunch or CrunchPad (RFP 40), communications with Pegatron ( the parties' chosen manufacturer) (RFP 43), and even documents created before the November 17, 2009, breakup that contains the word "JooJoo." (RFP 53). There is no basis for withholding any document responsive to these requests. While Fusion Garage makes some representation about these seven requests and claims that it has "produced documents responsive to nearly half of the requests at issue here," Fusion Garage is silent on 29 of the 37 document requests, as well as the two interrogatories, at issue. (The requests it lists on the bottom of page 12 of its opposition are not at issue in this motion.) 10
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For example, Fusion Garage does not call attention to discovery requests that seek communications with its secret manufacturer, Gigabyte (RFPs 54-55); communications with its partner and investor, CSL (RFPs 56-57); or communications with its payment processor, MPayments (RFP 59). Nor does it highlight RFP 78, which seeks "[a]ll documents that refer or relate to the design, development and/or manufacture of the tablet computer referred to as `Prototype B.'" As discussed above, Fusion Garage credited Plaintiffs with working on Prototype B and it does not make sense for Fusion Garage to withhold documents about that prototype because they contain trade secrets unless it is conceding that it intended to abandon the parties' joint venture at that early date. While Fusion Garage has produced some apparently non-proprietary documents that fall into these categories, it is impossible to know what is missing. Meanwhile, Fusion Garage has made no substantive response to Interrogatory No. 2, which seeks the identities of "all persons who participate, or have participated in, the design of, or the supply of components for, the JooJoo." These persons may be basic witnesses in the case and Fusion Garage must disclose their identities. As discussed in Plaintiffs' opening brief, the requests in dispute seek relevant, discoverable information. Whether Fusion Garage believes Plaintiffs need that information to pursue their case is not the issue. D. The Protective Order is Sufficient to Address Defendant's Concerns of Disclosure.

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Winston & Strawn LLP

Fusion Garage offers no reason why the Stipulated Protective Order in this case, which provides for "Attorneys' Eyes Only" designations, cannot protect Fusion Garage's alleged trade secrets. (See Dkt. No. 35.) The Supreme Court has noted that "orders forbidding any disclosure of trade secrets or confidential commercial information are rare. More commonly, the trial court will enter a protective order restricting disclosure to counsel." Fed Open Mkt. Comm. of Fed. Reserve Sys. v. Merrill, 443 U.S. 340, 363 n. 24 (1979). This is precisely what this Court did in Echostar Satellite LLC v. Freetech, Inc., No. 07-6124, slip. op. at 3-4 (N.D. Cal. May 18, 2009) (Seeborg, M.J.) (Scherb Decl. ISO Mot. to Compel Ex. B), a case Fusion Garage does not address. The Court ordered disclosure of source code under a standard protective order, which it viewed as entirely adequate. 11
PLAINTIFFS' REPLY IN SUPPORT OF THEIR TO MOTION TO COMPEL ­ Case No. 09-CV-5812 RS (PVT) SF:292522.9

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Fusion Garage misreads Mr. Arrington's extrajudicial comments about this case. His off-thecuff remark on Twitter was titillating but irrelevant: he later posted a detailed commentary on the amended complaint and its wealth of non-confidential documents, many of which had been declassified from Confidential or Attorneys' Eyes Only status based on the Court's strong encouragement to curb confidentiality designations. The facts of the matter are that (a) Mr. Arrington has not violated the protective order and (b) he will not have an opportunity to gain access to genuinely proprietary materials designated by Fusion Garage as "Attorney's Eyes Only." III. CONCLUSION Plaintiffs' requests seek relevant information that is the appropriate subject of discovery and necessary for them to present their case. Fusion Garage has failed to show it has trade secrets so exotic that the existing "Attorneys' Eyes Only" designation under the Stipulated Protective Order is somehow insufficient. Fusion Garage has delayed discovery long enough. The Court should deny Fusion Garage's outstanding protective order motion, grant this motion to compel, and order full and immediate production. Dated: September 30, 2010 WINSTON & STRAWN LLP By: /s/ Andrew P. Bridges David S. Bloch Matthew A. Scherb Attorneys for Plaintiffs TECHCRUNCH, INC. and CRUNCHPAD, INC.

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Winston & Strawn LLP

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PLAINTIFFS' REPLY IN SUPPORT OF THEIR TO MOTION TO COMPEL ­ Case No. 09-CV-5812 RS (PVT) SF:292522.9