ECOMMISSION SOLUTIONS, LLC v. CTS HOLDINGS, INC et al
Filing
7
MEMORANDUM AND OPINION. Signed by Judge Emmet G. Sullivan on August 26, 2016. (lcegs4)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
______________________________
)
ECOMISSION SOLUTIONS, LLC,
)
)
Plaintiff,
)
)
Misc. 16-1793 (EGS)
v.
)
)
CTS HOLDINGS, INC. and
)
CTS SYSTEMS, INC.,
)
)
Defendants.
)
______________________________)
MEMORANDUM OPINION
Pending before the Court is non-party witness Dell
Marketing, LP’s (“Dell”) Motion to Quash the forthcoming
deposition of Bradley Hughes (“Mr. Hughes”), or in the
alternative, for a Protective Order postponing a decision on
whether Mr. Hughes may be deposed as a non-party witness until
the Court presiding over the underlying action rules on
Defendants’ Motion to Amend its Complaint to add Dell as a
third-party. Dell’s Mem. Supp. Mot. Quash (“Dell’s Mem. Supp”),
ECF No. 1 at 1-2. Upon review of Dell’s Motion, the responses
and replies thereto, and for the reasons discussed below, Dell’s
Motion is GRANTED in part and DENIED in part.
I.
Background
Dell and Plaintiff Ecomission Solutions, LLC (“ECS”) were
engaged in a longstanding agreement that expired in March of
2015. Def.’s Mem. Opp. Pl.’s Mot. Quash (“Def.’s Mem. Opp.”),
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ECF No. 2 at 2. CTS served as Dell’s sub-contractor in relation
to that contract. Id. In 2015, ECS filed suit against Dell in
Texas state court, alleging tort and contract claims. Id.;
Dell’s Mem. Supp. at 2. The Texas lawsuit ended in a settlement
agreement, but CTS was not involved in the Texas litigation or
its resolution. Id.
In March 2015, ECS filed a complaint against CTS in New
York state court. Id. CTS removed the matter to federal court,
where it is currently pending in the Southern District of New
York (“S.D.N.Y.”) Id. CTS alleged in its Answer and Affirmative
Defenses and Counterclaim that Dell (among others) proximately
caused or contributed to ECS’s alleged damages. Def.’s Mem. Opp.
at 3. On July 29, 2016, CTS filed a motion to amend its
complaint to add Dell as a third-party defendant. Dell’s Mem.
Supp. at 2. That interpleader motion is currently pending in the
New York action. Def.’s Mem. Opp. at 3.
On August 11, 2016 CTS served a subpoena on Mr. Hughes to
take his deposition on August 26, 2016 (later changed to August
30, 2016) as a representative of non-party Dell. Def.’s Mem.
Supp. at 3 and 1, n.1.
II.
Legal Standard
A party “may obtain discovery regarding any nonprivileged
matter that is relevant to any party’s claim or defense . .
. [or which] appears reasonably calculated to lead to the
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discovery of admissible evidence.” Fed. R. Civ. P. 26(b)(1).
Limiting discovery and quashing subpoenas pursuant to Rule 26
and/or Rule 45 “goes against courts’ general preference for a
broad scope of discovery.” U.S. Dep’t of the Treasury v. Pension
Benefit Guaranty Corp., 301 F.R.D. 20, 25 (D.D.C. 2014)(quoting
North Carolina Right to Life, Inc. v. Leake, 231 F.R.D. 49, 51
(D.D.C. 2005)). The general policy favoring broad discovery is
particularly applicable where, as here, “the court making
relevance the determination has jurisdiction only over the
discovery dispute, and hence, has less familiarity with the
intricacies of the governing substantive law than does the court
overseeing the underlying litigation.” U.S. Dep’t of the
Treasury, 301 F.R.D. at 25 (citing Jewish War Veterans of the
United States of Am., Inc. v. Gates, 506 F. Supp. 2d 30, 42
(D.D.C. 2007)).
Under Rule 45(d)(3), a Court “must quash or modify a
subpoena that subjects a person to undue burden.” Fed. R. Civ.
P. 45(d)(3). “The individual or entity seeking relief from
subpoena compliance bears the burden of demonstrating that a
subpoena should be modified or quashed.” Sterne Kessler Goldtein
& Fox, PLLC v. Eastman Kodak Co., 276 F.R.D. 376, 379 (D.D.C.
2011) (citations omitted). The quashing of a subpoena is an
“extraordinary measure” and courts should be loath to grant such
relief where “other protection of less absolute character is
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possible.” U.S. Dept. of the Treasury v. Pension Benefit
Guaranty Corp., 301 F.R.D. 20, 25 (D.D.C. 2014).
Under Rule 26(c), a “party or any person from whom
discovery is sought may move for a protective order . . . on
matters relating to a deposition, in the court for the district
where the deposition may be taken.” Fed. R. Civ. P. 26(c).
Courts may grant protective orders where the moving party has
demonstrated good cause and demonstrated the need to protect a
party from “annoyance, embarrassment, oppression, or undue
burden or expense . . . .” Id. The moving party carries a “heavy
burden” of showing extraordinary circumstances based on
“specific facts” that would justify a protective order. Eidos
Display, LLC v. Chunghwa Picture Tubes, Ltd., 296 F.R.D. 3, 6
(D.D.C. 2013)(citing United States v. Kellogg Brown & Root
Servs. Inc., 285 F.R.D. 133, 134 (D.D.C. 2012)).
III. Analysis
Dell’s primary argument is that Mr. Hughes’ deposition
should be postponed until CTS’s Motion to Add Dell is ruled on
by the S.D.N.Y. so that Dell “will not face the prospect of Mr.
Hughes potentially being called to testify both as a non-party
and again later as a party witness.” Dell Mem. Supp. at 5. CTS
contends that if the Court grants Dell’s Motion on this basis,
it will “be prejudiced if it is denied this deposition and the
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New York court denies its application to implead Dell, leaving
CTS without this required deposition.” Def.’s Mem. Opp. at 7.
CTS’s argument is not persuasive. Issuance of a protective
order preventing Mr. Hughes’ deposition until CTS’s interpleader
motion is ruled on in the New York matter will both eliminate
the risk that Mr. Hughes will be deposed twice (once as a nonparty and once as a party), while preserving CTS’s ability to
depose Mr. Hughes as a non-party if CTS’s motion to interplead
Dell is denied. Notably, the only case with similar facts, as
cited by Dell, reasoned that:
Given that [the deponent]’s status as either
a percipient witness or a named defendant
awaits
the
district
judge’s
ruling
on
Plaintiff’s motion for leave to amend, the
Court is persuaded that a protective order
postponing [the deponent]’s deposition is
appropriate. [The deponent] is entitled to
answer questions when he knows whether he is
a defendant in this case.
Doe v. City of San Diego, Civ. No. 12-0689, 2013 WL 3989193, at
*7 (S.D. Ca. Aug. 1, 2013). CTS cites no contrary authority. 1
Dell has demonstrated good cause for issuance of a protective
order postponing Mr. Hughes deposition until the S.D.N.Y rules
on CTS’s Motion for Interpleader pending in the underlying
action. As in Doe, these specific facts demonstrate an undue
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Arguments by Dell and CTS relating to whether Mr. Hughes’
deposition is duplicative or necessary are superfluous until
CTS’s Motion to Interplead Dell is resolved in the New York
matter.
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burden on Dell that can be avoided by the least burdensome
remedy of a protective order postponing Mr. Hughes’ deposition
rather than quashing the subpoena at issue.
IV.
Conclusion
For the reasons discussed above, Dell’s Motion to Quash, or
in the alternative, for a Protective Order is GRANTED in part
and DENIED in part. To the extent Dell seeks to Quash Mr.
Hughes’ subpoena, the Motion is DENIED; to the extent Dell seeks
a Protective Order postponing Mr. Hughes’ deposition until CTS’s
Motion to Interplead Dell is ruled on is GRANTED. An appropriate
order accompanies this Memorandum Opinion.
SO ORDERED.
Emmet G. Sullivan
United States District Court
August 26, 2016
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