Brand Services, LLC v. Irex Corporation

Filing 103

ORDER denying 94 Motion to Enforce Court Order. Signed by Magistrate Judge Karen Wells Roby on 5/11/2017. (tm)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
BRAND SERVICES, LLC

CIVIL ACTION

VERSUS

NO:

IREX CORPORATION

SECTION: “H” (4)

15-5712

ORDER
Before the Court is a Motion to Enforce Court Order (R. Doc. 94) filed by Plaintiff
seeking an order to compel the Defendant to supplement certain discovery responses. The motion
is opposed. R. Doc. 101. The motion was submitted on May 10, 2017.
I.

Background
Brand Services LLC, a company that manufactures industrial scaffolds, argues that James

Stanich was an informational technology specialist who worked for Brand under a non-compete,
non-solicitation and invention assignment agreement. Brand further alleges that Stanich—in
violation of that agreement--voluntarily left the company as an information technology specialist
on June 30, 2015, and began working for Irex, the Defendant, which is its competitor. Before he
left the company, Brand Services argues that Stanich transferred a number of files that contain
trade secrets and proprietary information from his Brand-issued laptop to an external hard drive
and later to his Irex-laptop. Further, he allegedly deleted and wiped 1 large amounts of information
from the Brand-issued laptop to conceal his actions. Brand Services states that a forensic
examination of Stanich’s laptop proves that he transferred the files to the Irex-laptop.
Brand filed for and received a temporary restraining order (“TRO”) in August of 2015
against Stanich and anyone acting in concert with him to surrender any electronic devices used by
Stanich since March 1, 2015 and to preserve those devices for forensic examination by Brand.
Stanich complied with the TRO. By agreement with Stanich, the TRO was converted to a

1

Wiped is a technical term used to describe a specific deletion activity that overwrites the
deleted files so as to make it more difficult to discover what files were deleted.

preliminary injunction. Brand subsequently entered a Settlement Agreement with Stanich, which
converted the preliminary injunction into a permanent injunction. After the settlement, Irex stated
that the forensic examinations would cease and the computer would be returned to Irex. Brand
objected, citing the permanent injunction. When the parties failed to agree, Brand filed the instant
suit for injunctive relief as well as damages under the Louisiana Uniform Trade Secrets Act against
Irex as it argues that Irex acquired trade secrets including files regarding Brand’s scaffold tracker
software that Stanich allegedly stole from the company. Brand has further allegedly identified
through computer inspection that Leslie Johnson and Albert Rowe are also individuals involved
with Stanich in the scheme to use Brand’s proprietary business information. R. Doc. 52-2, p. 1.
Both Johnson and Rowe were also former Brand employees who allegedly downloaded,
disseminated, and used Brand’s information at Irex and Vertical Access.
On March 30, 2017, the Court denied a motion to compel filed by Brand which sought an
order compelling Irex to produce further discovery. The Court found that Brand had not timely
moved for relief in connection with discovery nor demonstrated good cause to allow out-of-time
discovery. R. Doc. 88. As part of its order, the Court also reminded Irex of its duty to supplement
discovery requests under Federal Rules of Civil Procedure 26(e)(1)(A) and ordered it to comply
with those obligations. Id. Irex appeared to represent during oral argument that it had set up
procedures to find further responsive documents that it indicated in its supplemental response it
would look for, but that it was waiting on Brand to indicate that it needed more discovery before
it took action. Finally, on April 4, 2017, the District Court denied Brand’s motion to continue trial
and extend deadlines. Nonetheless, the District Court has recently continued the pre-trial
conference and trial dates, but has extended no other deadlines. R. Doc. 102.
Brand has now filed a Motion to Enforce Court Order. R. Doc. 94. Brand argues that Irex
has not supplemented its responses and has not conducted any search for further responsive
documents. R. Doc. 94-1, p. 2. As such, Brand believes that Irex has not complied with the Court’s

order. Id. Irex has taken the position that its currently unaware of any documents falling within the
documents requested other than those produced already either in response to discovery or produced
during or attached to a deposition. R. Doc. 101, p. 2. Irex has stated such to both the undersigned
as well as the District Judge.
As this Court has previously explained, the Federal Rules of Civil Procedure provide:
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: 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
Fed. R. Civ. P. 26(e)(1)(A); see also Who Dat Yat Chat, LLC v. Who Dat, Inc., No. 10-1333, 2011
WL 4018320 at *3-4 (E.D. La. Sept. 9, 2011). And, indeed, this Court did remind and order Irex
of this obligation. R. Doc. 88, p. 8-9. However, “‘[o]rdinarily, the representation of a party's
attorney that no additional documents exist is sufficient to defeat a motion to compel absent
credible evidence that the representation is inaccurate. Consequently, if plaintiffs ... ‘do not
provide any evidence demonstrating that responsive documents do, in fact, exist and are being
unlawfully withheld, their motion to compel must fail.’’” Washington v. Tubbs, No. 3:13–cv–0217,
2013 WL 6796429, at *2 (W.D. La. Dec. 19, 2013) (quoting Brown v. Tellermate Holdings, Ltd.,
2:11–cv–1122, 2013 WL 1363738, at *6 (S.D. Ohio April 3, 2013)).
At this time, Brand maintains that Irex has failed comply with its obligation because Irex’s
attorney stated in an email that “I am of the view that I presently have no ‘obligation to search for
those categories of documents and produce responsive documents that I have.’” R. Doc. 94-4, p.
2. However, this is a short-cited reading of the Irex’s attorney’s communication. The email initially
states, “I reiterate what I said during oral argument before Judge Milazzo on April 5, 2017: I am
presently unaware of the existence of any document that falls within the description of documents
requested, other than the documents that have been described in the parties’ exhibit lists, those that

have already been produced, and those that have been produced during and attached to depositions
taken in this case.” Id. Taking the email as a whole and understanding that no evidence has been
produced to demonstrate that Irex has withheld documents, the Court cannot find at this time that
Irex has failed to comply with its obligation to supplement. Therefore, the Court denies the present
motion.
IV.

Conclusion
Accordingly,
IT IS ORDERED that Motion to Enforce Court Order (R. Doc. 94) is DENIED.

New Orleans, Louisiana, this 11th day of May 2017.

KAREN WELLS ROBY
UNITED STATES MAGISTRATE JUDGE