Cavner et al v. Airborne Systems North America of CA, Inc. et al

Filing 113

ORDER denying Airborne's #78 Motion for Relief Arising from Violation of the Protective Order, and granting the April 11, 2017 Stipulation Regarding Additional Discovery Dispute. Signed by Magistrate Judge Bernard G. Skomal on 4/28/17. (kas)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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STEVE CAVNER and BETH CAVNER,

Case No.: 15cv2656 LAB (BGS)

Plaintiffs,

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v.

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ORDER
(1) DENYING DEFENDANT’S
MOTION FOR RELIEF ARISING
FROM VIOLATION OF
PROTECTIVE ORDER
(2) GRANTING APRIL 11, 2017
STIPULATION REGARDING
ADDITIONAL DISCOVERY
DISPUTE

AIRBORNE SYSTEMS NORTH
AMERICA OF CA, INC. et al.,

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Defendants.

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[ECF Nos. 78, 96]

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On February 6, 2017, the parties contacted the Court regarding a possible violation

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of the Protective Order. Specifically, Defendant Airborne Systems North America of

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CA, Inc. alleges that Plaintiffs Steve and Beth Cavner violated the Protective Order by

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disclosing confidential documents produced by Airborne to Plaintiffs’ expert, John

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Sherman. Airborne asserts that Mr. Sherman is a competitor based on his relationship to

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Parachute Laboratories, Inc. (“Parachute Labs”). The Court issued a briefing schedule.

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Airborne filed a Motion for Relief Arising from Violation of Protective Order and
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Plaintiffs filed an Opposition. (ECF Nos. 78, 80.) As explained more fully below, the

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Court DENIES the Motion because there is not currently a sufficient connection between

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Mr. Sherman and Parachute Labs to consider him a competitor on that basis.

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BACKGROUND

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Plaintiffs have retained Mr. Sherman as an expert in this case. Mr. Sherman is

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employed by Humatec, an expert consulting firm. (Decl. of John B. Sherman (“Sherman

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Decl.”) ¶ 6.) He founded Parachute Labs in 1969, but retired from the company on

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November 12, 2002. (Id. ¶ 3.) His declaration and the President of Parachute Labs’

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declaration both indicate that Mr. Sherman has not worked for or received any

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compensation from Parachute Labs since his retirement. (Id.; Decl. of Nancy LaRiviere

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(“LaRiviere Decl.”) ¶ 15.) Additionally, a computerized record from Parachute Labs and

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the declaration of the company’s Office Manager indicate the same. (Decl. of Suzie Bass

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¶ 5-6, Ex. A.)

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Mr. Sherman is married to the current President of Parachute Labs, although his

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declaration indicates that he has not provided his wife with any documents related to this

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litigation nor discussed any information related to the case with her or any of Parachute

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Labs’ employees. (Sherman Decl. ¶ 5.) She declares the same. (LaRiviere Decl. at ¶ 6.)

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In addition to having executed the Protective Order in this case, Mr. Sherman also

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indicates that he is subject to a Humatec Confidentiality Agreement under which he

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cannot disclose any documents or information to any third party. (Sherman Decl. at ¶ 8.)

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He declares that he is in compliance with both. (Id.)

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Airborne has submitted the Declaration of Jean C. Berland (“Berland Decl.”) and

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an exhibit indicating that on January 16, 2017, Parachute Labs’ website indicated Mr.

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Sherman would be teaching a parachute rigging course on January 13-21, 2017. (Berland

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Decl. ¶ 7, Ex. C.) Additionally, Airborne has submitted sign in sheets from the Parachute

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Certification Standards Committee’s meetings held on February 11, 2012 and August 24,

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2012 reflecting Mr. Sherman signed in at each as affiliated with Parachute Labs and
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included his email address associated with Parachute Labs. (Id. ¶ 9, Ex. E.)

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Mr. Sherman does not dispute that he attended these meetings in 2012, but

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indicates he did not represent Parachute Labs nor was he compensated by Parachute Labs

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to attend. (Sherman Decl. ¶ 10.) Ms. LaRiviere indicates the same. (LaRiviere Decl. at

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¶ 14.) Mr. Sherman explains he attended with his wife and his signing in as associated

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with Parachute Labs was a “force of habit, based on my decades of attending these and

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similar meetings while actively involved in my former company prior to my 2002

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retirement.” (Sherman Decl. at ¶ 10.) He indicates he ceased using his email address

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associated with Parachute Labs for business purposes when he retired, but continued to

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use it otherwise because it was the email address others had for him and he did not have

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another personal email address. (Id. ¶ 11.)

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Mr. Sherman’s declaration also indicates that he was not present for and did not

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participate in any way in the January 2017 class listed on the Parachute Labs website.

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(Sherman Decl. ¶ 9.) Timothy M. Patterson, Jr., present for this class, declares the same.

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(Decl. of Timothy Patterson, Jr. ¶ 6.) Ms. LaRiviere indicates that she personally

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maintains the website and the listing of Mr. Sherman was a mistake — she neglected to

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take his name off the website after he participated as an uncompensated speaker for a

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similar course years before. (LaRiviere Decl. ¶ 13.)

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DISCUSSION

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I.

Protective Order Violation
Airborne seeks sanctions against Plaintiffs for violating the February 12, 2016

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Protective Order’s provision prohibiting disclosure of confidential documents to

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competitors of the designating party. (Prot. Order ¶ 10.) There is no dispute that

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Airborne’s confidential documents have been disclosed to Mr. Sherman. The only issue

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is whether Mr. Sherman is a competitor to Airborne.

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Airborne argues Mr. Sherman is a competitor and seeks an order: (1) compelling

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Mr. Sherman to return all confidential documents; (2) disqualifying Mr. Sherman as an

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expert for Plaintiffs; (3) imposing civil contempt sanctions against Plaintiffs and their
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counsel; (4) requiring Plaintiffs to identify or certify that their second, anonymous

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consulting expert is not associated with any parachute design or manufacturing company

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that sells parachutes to U.S. or foreign militaries.1

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The provision of the Protective Order Airborne asserts Plaintiffs violated provides
as follows:

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Discovery Materials designated as Confidential may not be provided to
competitors of the designating party, including but not limited to in-house
counsel for the designating party’s competitors, their paralegals, or regularly
employed office staff, but excluding local counsel for any defendant in this
case. Any party that believes it is necessary to disclose Discovery Materials
designated as Confidential to any competitor(s) of the designating party
must obtain the approval of the designating party prior to disclosure of
Discovery Material.

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(Protective Order ¶ 10 (emphasis added).) Competitor is not further defined.

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Airborne argues the disclosure of confidential documents to Mr. Sherman violated

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the Protective Order because he “continues to be involved in Parachute Laboratories,

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Inc., a competitor of Airborne.” (Airborne’s Mot. at 3.) To find a violation on this basis,

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the Court would have to find that Parachute Labs is a competitor to Airborne and that Mr.

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Sherman has a sufficient connection to Parachute Labs that he could be considered a

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competitor based on his affiliation with Parachute Labs. Because the Court finds there is

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not a sufficient connection between Mr. Sherman and Parachute Labs to make Mr.

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Sherman a competitor on that basis, the Court does not address whether Parachute Labs is

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itself a competitor to Airborne.2

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Airborne asserts that Mr. Sherman is a competitor to Airborne through his
affiliation with Parachute Labs because he founded Parachute Labs, is married to its

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Airborne’s demand for this disclosure, like the other relief demanded, is based on
Plaintiffs having violated the Protective Order on this issue. Because the Court finds no
violation as to Mr. Sherman, this relief is also denied.
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Plaintiffs also argue that even if there were a sufficient connection between Mr.
Sherman and Parachute Labs, Parachute Labs is not a competitor to Airborne.
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President and owner, and continues to be involved in it. The Court addresses each of

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Airborne’s arguments, but also finds in considering the connections collectively, there is

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not a sufficient connection between Mr. Sherman and Parachute Labs to consider him a

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competitor, even assuming Parachute Labs is a competitor.
Two pieces of information Airborne relies on do not reflect on Mr. Sherman’s

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connection to Parachute Labs now. First, his founding the company in 1969 is very

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distant in time. Although it does reflect a lengthy history with the company, it does not

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show that he is affiliated with the company now, particularly given the evidence he

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retired in 2002 and has received no compensation from Parachute Labs since. Second,

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his signing in for two Parachute Certification Standards Committee meetings in 2012 was

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almost five years ago. The Court acknowledges that his signing in as affiliated with

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Parachute Labs might undermine his claim that he had not worked for the company for

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almost ten years. However, his attendance with his spouse who was affiliated with

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Parachute Labs might explain this and Mr. Sherman’s explanation — force of habit after

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so many years with this company — is not an unreasonable explanation.

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As to the more recent connection asserted, his being listed on a website as teaching

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a class in 2017, it is also not sufficient. Mr. Sherman undisputedly did not teach or attend

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this class and he has received no compensation from the company for doing so or at all.

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Although not necessary, given he did not teach, receive compensation, or even attend the

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class, the explanation that it was posted in error, only further supports the conclusion that

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he was not affiliated with Parachute Labs through this 2017 class.

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Finally, Mr. Sherman’s wife being President of Parachute Labs is not a sufficient

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affiliation with the company to make Mr. Sherman a competitor to Airborne, assuming

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Parachute Labs is a competitor to Airborne. Neither party provides any authority that a

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spouse’s affiliation with a company can or cannot be imputed to their spouse.3 And, in

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Plaintiffs did cite cases addressing the absence of a conflict in married attorneys’ firms’
being on opposing sides in litigation. However, as noted above, considering the
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considering the circumstances presented in this case, the Court cannot find Mr. Sherman

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is a competitor based on his wife being the President of Parachute Labs. Practically, it

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would be comparable to assuming, by virtue only of their marriage, that Mr. Sherman has

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or will disclose information gained from Airborne’s documents to his wife based solely

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on their marriage. This would be a particularly challenging jump to make when both

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have declared Mr. Sherman has not made such a disclosure and his declaration that he

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will not.

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II.

Additional Discovery Dispute

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The parties jointly raised an additional discovery dispute on April 5, 2017. (ECF

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No. 93.) After being advised of the Court’s assessment of the dispute and that an order

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regarding briefing would be forthcoming, (ECF No. 95), the parties filed a Joint Motion

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stipulating that Airborne had elected not to file a motion and to withdrawal of the dispute.

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(ECF No. 96.) Based on the foregoing, the Court GRANTS the parties’ stipulation and

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considers the dispute withdrawn.

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CONCLUSION
Airborne’s Motion for Relief Arising from Violation of the Protective Order is
DENIED. The April 11, 2017 stipulation is GRANTED.
IT IS SO ORDERED.
Dated: April 28, 2017

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circumstances here and the absence of any authority from Airborne identifying a per se
rule Mr. Sherman steps into the shoes of Parachute Labs by way of his marriage, the
Court need not attempt to analogize to Plaintiffs’ authority.
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