Arcell et al v. Google LLC et al

Filing 47

Order Granting #36 Motion to Stay Discovery. Signed by Judge Edward J. Davila on 10/31/2022. (ejdlc3, COURT STAFF) (Filed on 10/31/2022)

Case 5:22-cv-02499-EJD Document 47 Filed 10/31/22 Page 1 of 3

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

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MARY KATHERINE ARCELL, et al.,
Plaintiffs,

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United States District Court
Northern District of California

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v.

Case No. 5:22-cv-02499-EJD
ORDER GRANTING MOTION TO
STAY DISCOVERY PENDING
RULING ON MOTION TO DISMISS

GOOGLE LLC, et al.,
Defendants.

Re: Dkt. No. 36

Plaintiffs initiated this antitrust suit on April 22, 2022. Dkt. No. 1. Plaintiffs essentially

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allege that Defendants Apple, Inc. (“Apple”) and Google LLC (“Google”) violated federal

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antitrust laws by agreeing not to compete in the internet search business. Id. Defendants’ motion

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to dismiss the Complaint is fully briefed (Dkt. Nos. 25, 32, 35) and was taken under submission on

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October 26, 2022 (Dkt. No. 46).

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Pending before the Court is Defendants’ “Motion for a Protective Order Temporarily

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Staying Discovery” (“Motion”) until the Court issues a ruling on Defendants’ motion to dismiss

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the Complaint. Dkt. Nos. 36 -38. The Motion is suitable for disposition without oral argument

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pursuant to Civil Local Rule 7-1(b). For the reasons stated below, the Motion will be granted.

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“The district court has wide discretion in controlling discovery.” Little v. City of Seattle,

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863 F.2d 681, 685 (9th Cir. 1988); Hall v. Tilton, 2010 WL 539679, at *2 (N.D. Cal. Feb. 9, 2010)

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(“A district court has broad discretion to stay discovery pending the disposition of a dispositive

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motion.”). Under Federal Rule of Civil Procedure 26(c), “[t]he court may, for good cause, issue

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an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden

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or expense[.]” Fed. R. Civ. P. 26(c). Many courts in this district apply a two-prong test to

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Case No.: 5:22-cv-02499-EJD
ORDER GRANTING MOTION TO STAY DISCOVERY
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Case 5:22-cv-02499-EJD Document 47 Filed 10/31/22 Page 2 of 3

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determine whether a stay of discovery is appropriate: “(1) will the motion dispose of the entire

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case (or at least the issue at which discovery is aimed)? and (2) can the motion be decided without

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further discovery?” Onuoha v. Facebook, Inc., 2017 WL 11681325, at *1 (N.D. Cal. Apr. 7,

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2017) (collecting cases).

United States District Court
Northern District of California

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Here, both elements favor a stay. First, Defendants’ motion to dismiss may dispose of the

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entire case. Defendants raise numerous significant challenges to the Complaint, including the

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failure to plead direct or circumstantial evidence of a horizontal conspiracy to support the Section

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1 claim; failure to plead a conspiracy, a relevant market, and the requisite intent to support the

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Section 2 claim; failure to plead antitrust standing; statute of limitations; and laches. Defendants

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also argue that some of the forms of relief Plaintiffs seek are unavailable as a matter of law. At a

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minimum, Defendants have established that their motion is “potentially dispositive” of the entire

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case, which weighs in favor of granting a stay of discovery until the Court issues a ruling on

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Defendants’ motion to dismiss. Malley v. San Jose Midtown Dev. LLC, 2020 WL 5877575, at *7

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(N.D. Cal. Oct. 2, 2020).

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Second, Defendants’ motion to dismiss can be decided without further discovery because

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the motion “is based solely on the allegations in the Complaint and does not raise any factual

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issues.” Reveal Chat Holdco, LLC v. Facebook, Inc., 2020 WL 2843369, at *3 (N.D. Cal. Apr.

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10, 2020).

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Further, there is good cause to stay discovery at this time because it will promote

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efficiency and avoid undue burden to Defendants; discovery in antitrust cases tends to be “broad,

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time-consuming and expensive.” In re Netflix Antitrust Litig., 506 F. Supp. 2d 308, 321 (N.D.

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Cal. June 14, 2007) (citing Bell Atlantic Corp. v. Twombly, 127 S.Ct. 1955, 1967 (2007)).

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Plaintiffs assert that a stay of discovery is not warranted because they are presently seeking only

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“limited” discovery. This “limited discovery” consists of the depositions of Defendants Tim

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Cook, Sundar Pichai, Eric Schmidt, and other Apple and Google executives; interrogatories

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regarding Google’s payments to Apple; and production of any written contracts between Google

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and Apple regarding Google’s payments to Apple. However, “[t]he purpose of F.R.Civ.P.

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Case No.: 5:22-cv-02499-EJD
ORDER GRANTING MOTION TO STAY DISCOVERY
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Case 5:22-cv-02499-EJD Document 47 Filed 10/31/22 Page 3 of 3

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12(b)(6) is to enable defendants to challenge the legal sufficiency of complaints without subjecting

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themselves to discovery.” Rutman Wine Co. v. E. & J. Gallo Winery, 829 F.2d 729, 738 (9th Cir.

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1987) (citing Greene v. Emersons Ltd., 86 F.R.D. 66, 73 (S.D.N.Y. 1980), aff'd, 736 F.2d 29 (2d

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Cir. 1984)). “In antitrust cases this procedure especially makes sense because the costs of

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discovery in such actions are prohibitive.” Id. (citing Car Carriers v. Ford Motor Company, 745

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F.2d 1101, 1105-07 (7th Cir. 1984), cert. denied, 470 U.S. 1054, 105 S.Ct. 1758, 84 L.Ed.2d 821

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(1985)).

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United States District Court
Northern District of California

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Accordingly, Defendants’ Motion to Stay Discovery is GRANTED. Discovery is
STAYED until the Court issues a ruling on Defendants’ motion to dismiss.
IT IS SO ORDERED.
Dated: October 31, 2022

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EDWARD J. DAVILA
United States District Judge

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Case No.: 5:22-cv-02499-EJD
ORDER GRANTING MOTION TO STAY DISCOVERY
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