Source Production & Equipment Co., Inc. et al v. Schehr et al

Filing 14

ORDER AND REASONS DENYING 3 Emergency MOTION to Expedite Discovery filed by plaintiffs.. Signed by Judge Sarah S. Vance on 1/4/17.(jjs)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
SOURCE PRODUCTION &
EQUIPMENT CO., INC., ET AL

CIVIL ACTION

VERSUS

NO. 16-17528

KEVIN J. SCHEHR, ISOFLEX USA,
ISOFLEX RADIOACTIVE LLC,
RICHARD H. MCKANNAY, JR., AND
JOHN DOES 1-10

SECTION “R”

ORDER AND REASONS
Before the Court is plaintiffs Source Production & Equipment Co., Inc.;
Aspect Technology Limited; Specmed, LLC; Spec Med Intellectual Property,
LLC; and Spec Intellectual Property, LLC’s ex parte motion for expedited
discovery. 1 For the following reasons, the motion is denied.

I.

BACKGROUND
On December 16, 2016, plaintiffs filed suit against Kevin J. Schehr;

IsoFlex USA; Isoflex Radioactive LLC; Richard H. McKannary, Jr.; and John
Does 1-10. Plaintiffs’ complaint alleges various federal and state law causes
of action. 2 The complaint alleges that Kevin Schehr, a former employee of

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R. Doc. 3.
R. Doc. 1.

Source Production & Equipment Co., misappropriated plaintiffs’ intellectual
property and commercial sensitive information in order to directly compete
with Source Production. 3 Also on December 16, 2016, plaintiffs filed this ex
parte motion for expedited discovery to identify any confidential or trade
secret information disclosed by Schehr, to produce property retained by
Schehr and other defendants that relate to plaintiffs’ business, and identify
email addresses used by Schehr.4 Plaintiffs also seek to inspect and take
pictures of the premises and operations of Isoflex Radioactive, Schehr’s
newly formed venture.5

According to plaintiffs, expedited discovery is

necessary to allow plaintiffs to gain the necessary information required to
effectively seek preliminary injunctive relief and to prevent defendants from
destroying evidence. 6
As of the date of this order, defendants have not been served, and
therefore have not had an opportunity to respond to this motion. Thus,
plaintiffs request the Court to authorize expedited discovery ex parte.

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4
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R. Doc. 3-2 at 2.
Id. at 8.
Id.
Id. at 7-9.
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II.

DISCUSSION
Plaintiffs’ motion focuses primarily on establishing that they have

satisfied the good cause standard used by a majority of courts in this Circuit
to determine if expedited discovery is warranted. 7 Their motion, however,
barely addresses the threshold question of whether expedited discovery
should be granted ex parte before the defendants have an opportunity to
respond. Motions for expedited discovery are rarely granted without notice
to the opposing party. See Wright & Miller, 8A Fed. Prac. & Proc. Civ. §
2046.1 (3d ed.) (“Usually leave to proceed before the Rule 26(f) conference
should be granted only after notice to the other parties.”); see also Yokohama
Tire Corp. v. Dealers Tire Supply, Inc., 202 F.R.D. 612, 613-14 (D. Ariz.
2001) (denying ex parte motion for expedited discovery because plaintiff had
not adequately addressed why ex parte relief was necessary); Leone v.
Towanda Borough, No. 12-0429, 2012 WL 1123958, at *3 (M.D. Pa. Apr. 4,

In deciding expedited discovery motions, district courts use
either a “good cause” standard or the standard used for determining if a
preliminary injunction is warranted. See Wright & Miller, 8A Fed. Prac. &
Proc. Civ. § 2046.1 (3d ed.). The Fifth Circuit has not given guidance as to
which standard to use, but a majority of courts in this Circuit have used the
good cause standard. See Wilson v. Samson Contour Energy E & P, LLC,
No. 14-0109, 2014 WL 2949457, at *2 (W.D. La. June 30, 2014) (collecting
cases).
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2012) (denying plaintiff’s ex parte motion for expedited discovery because
plaintiff had not established that ex parte relief was warranted). As the
District Court for the Central District of California has described, “ex parte
motions are inherently unfair” and “debilitate the adversary system.”
Mission Power Eng’g Co. v. Continental Cas. Co., 883 F. Supp. 488, 490
(C.D. Cal. Mar. 14, 1995). Therefore, plaintiffs bear a heavy burden in
establishing that ex parte relief is warranted.
Plaintiffs’ motion cites multiple cases in which courts authorized
limited expedited discovery, but those cases dealt with motions that were
either opposed or granted only after defendant had an opportunity to
respond, and therefore were not ex parte. See OMG Fidelity Inc. v. Sirius
Technologies, Inc., 239 F.R.D. 300 (N.D.N.Y. 2006); Asahi Glass Co., Ltd.,
v. Toledo Eng’g Co., Inc., 262 F. Supp. 2d 845 (N.D. Ohio 2003) (expedited
discovery granted after hearing); Monsanto Co. v. Woods, 250 F.R.D. 411
(E.D. Mo 2008) (granting motion for expedited discovery after defendant
failed to respond to motion). Plaintiffs cite no case where a court granted
expedited discovery ex parte and the Court has not found any similar case
where expedited discovery was granted ex parte. 8 Other than plaintiffs’

It appears that ex parte expedited discovery motions are rarely
granted outside of cases in which plaintiffs cannot identify any defendants
and need expedited discovery in order to identify the unidentified
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speculative belief that receipt of the complaint “could cause [defendants] to
destroy vital evidence,”9 (emphasis added) plaintiffs’ motion fails to address
why defendants should not be given notice of the motion or an opportunity
to be heard. See Yokohama, 202 F.R.D. at 613. Additionally, plaintiffs’
argument as to the destruction of evidence is inconsistent with the
information in plaintiffs’ motion.

Plaintiffs argue that Schehr already

downloaded information from his company laptop to a thumb drive and then
deleted files from the laptop, and this suggests he may destroy the evidence
if notified of this law suit.10 But plaintiffs also note that Schehr is represented
by counsel and his counsel has already received and responded to demand
letters regarding this dispute.11 It strains credulity to believe that Schehr,
who is apparently aware of the potential of litigation, has not yet destroyed
evidence but would do so solely upon receipt of this complaint or upon
discovering this motion.

defendants. This is often the situation in cases where internet users illegally
obtain copyrighted material and the copyright owners can identify them only
by obtaining discovery from the unidentified defendants’ internet service
providers. See, e.g., Fonovisa, Inc., v. Does 1-9, No. 07-1515, 2008 WL
919701, at *10 (W.D. Pa. Apr. 3, 2008); Interscope Records v. Does 1-14, No.
07-4107, 2007 WL 2900210 (D. Kan. Oct.1, 2007).
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R. Doc. 3-2 at 9.
10
Id. at 3, 9.
11
Id.
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Without more, plaintiffs’ suggestion that defendants may destroy
evidence is not sufficient to justify ex parte expedited discovery. See Rovio
Entertainment Ltd. v. Royal Plush Toys, Inc., 907 F. Supp. 2d 1086, 10991100 (N.D. Cal. 2012) (denying ex parte motion for expedited discovery and
finding that plaintiff’s argument that because defendants previously engaged
in “deceptive practices” they would destroy evidence did not warrant ex parte
relief).

Because plaintiffs have not adequately shown why expedited

discovery should be granted without defendants receiving notice or an
opportunity to be heard, plaintiffs’ motion must be denied.

III. CONCLUSION
For the foregoing reasons, plaintiffs’ ex parte motion for expedited
discovery is DENIED WITHOUT PREJUDICE.

4th
New Orleans, Louisiana, this _____ day of January, 2017.

_____________________
SARAH S. VANCE
UNITED STATES DISTRICT JUDGE

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