GOLD GROUP ENTERPRISES, INC. v. BULL
Filing
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LETTER OPINION AND ORDER granting in part and denying in part 2 Motion to Quash. Signed by Magistrate Judge Michael A. Hammer on 6/16/15. (sr, )
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
Chambers of
Martin Luther King Federal Building
& U.S. Courthouse
50 Walnut Street
Newark, NJ 07101
(973) 776-7858
Michael A. Hammer
United States Magistrate Judge
June 16, 2015
To: All counsel of record
LETTER OPINION & ORDER
RE:
Gold Group Enterprises, Inc. v. James Bull
Civil Action No. 14-7410 (ES)(MAH)
Dear Counsel:
This Letter Opinion and Order will address Petitioner Gold Group Enterprises, Inc. d/b/a
Gold Mobile’s (“Gold Mobile”) motion to quash [D.E. 2] portions of a subpoena that Respondent,
James Bull, has issued to it in connection with Bull v. US Coachways, Inc., Civ. No. 14-5789,
pending in the United States District Court for the Northern District of Illinois. The Court has
considered the papers submitted in support of, and in opposition to, the motion to quash. Pursuant
to Federal Rule of Civil Procedure 78, the Court did not hear oral argument. For the reasons
stated below, the Court grants in part and denies in part Petitioner’s application.
I.
Background
Respondent James Bull is the plaintiff in Bull v. US Coachways, Inc., Civ. No. 14-5789
(N.D. Ill.), a putative class-action lawsuit.
The complaint in that matter alleges that US
Coachways, Inc. violated the Telephone Consumer Protection Act (“TCPA”), 47 U.S.C. § 227 et
seq., when it sent unauthorized text messages, also known as SMS messages, to consumers. See
Complaint, Ex. B. to Declaration of Scott S. Christie, Esq. (“Christie Decl.”), D.E. 2-2, at 1-2.
For example, the complaint alleges that on December 16, 2013, Respondent received a text
message that stated as follows:
Happy Holidays from US Coachways: For holiday party rentals of buses, limos &
mini-buses call 800-359-5991.
Text HELP for help, STOP to end.
Msg&DataRatesMayAply [sic].”
Id. at ¶¶ 13-14. The complaint further alleges that Respondent received additional unsolicited
advertisements from US Coachways via text message on January 28, 2014, March 5, 2014, and
April 15, 2014. Id. at ¶¶ 15-20. The complaint contends that recipients of such unsolicited
messages often had “to pay their cell phone service providers for the receipt of such spam . . . .”
Id. at 1-2. As of the filing of this motion, no class had been certified. See Copy of Docket in Civ.
No. 14-5789 (N.D. Ill.), Ex. C to Christie Decl., D.E. 202.
Petitioner Gold Mobile is not a party to the litigation. According to Gold Mobile’s
Executive Vice President, Gold Mobile
provid[es] various technological platforms and services that allow companies to
engage consumers and promote their businesses to existing and prospective
customers. Gold Mobile’s platforms and services include various mobile
engagement programs. As part of Gold Mobile’s services, Gold Mobile sends
promotional e-mails and texts at the request of its clients, and facilitates other forms
of communication between its clients and those clients’ existing and prospective
customers.
Declaration of Jeffrey R. Allen (“Allen Decl.”), D.E. 2-3, ¶ 2. Gold Mobile’s customers include
US Coachways. Id. at ¶ 3.
Respondent served a subpoena on Petitioner on or about October 15, 2014. Id. at ¶ 4;
Subpoena, Ex. A to Christie Decl. (“Subpoena”), D.E. 2-2. The subpoena contains six separate
requests. Most pertinent here is Request No. 1 (the “Request”), which seeks the following:
All data concerning any text messages sent where the purpose of such call included
development of business for US Coachways, Inc. A full response to include at
least the following: the target list, call detail records and a copy of the text message
sent.
Subpoena at 4.
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II.
Overview of the Parties’ Arguments
Petitioner objects to the Request for three reasons. First, Petitioner argues that the
Request is so broad as to be unduly burdensome. Petitioner avers that the Request neither
specifies a timeframe, nor defines “data.”
Therefore, Petitioner claims, compliance would
require it “to produce personal information for approximately 137,000 individuals and millions of
text messages.” Allen Decl. at ¶ 6. That, in turn, would require Gold Mobile “to dedicate one of
its three developers to the task of reviewing and segregating data and records from archives dating
back to 2010. Such a reallocation of scarce company resources would reduce productivity by
33% and negatively impact the company’s ability to satisfy existing obligations to its customers.”
Id.
Second, Petitioner contends that “all data” as used in the Request seeks the production of
its confidential and proprietary business information, including how Gold Mobile sends messages
to its clients’ customers. Id. at ¶¶ 8-9. Petitioner avers that its competitors do not know the
“precise means and methods” by which Petitioner transmits the messages, and that Petitioner has
“taken appropriate steps” to protect this information. Id. at ¶ 9. Petitioner claims that requiring
it to divulge this information would cause Petitioner to suffer “serious commercial injury and a
significant competitive disadvantage.” Id.
Finally, Petitioner argues that the Request would require Petitioner to disclose the personal
information of US Coachway’s customers, contrary to Petitioner’s internal policy against
disclosing third-party information that Petitioner’s clients disclose to it. Id. at ¶ 10. Petitioner
asserts that any such disclosure would have to be Court-ordered and completed pursuant to a
protective order that restricts disclosure to “Attorneys’ Eyes Only.” Apparently, the protective
order in the Illinois action does not provide for “Attorneys’ Eyes Only” protection.
Petitioner’s Brief, D.E. 2-4, at 6.
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See
Respondent contends that the discovery is necessary now because discovery in the
underlying action is not bifurcated into class discovery and merits discovery. See Respondent’s
Brief, D.E. 4, at 8. Respondent argues that the means by which Petitioner transmits messages to
its clients’ customers is essential discovery because the TCPA prohibits using an “automatic
telephone dialing system” to call a number that has been assigned to a cell service. Id. at 12
(quoting 47 U.S.C. § 227(b)(1)(A)(iii)). The TCPA provides:
(1) The term “automatic telephone dialing system” means equipment which has the
capacity--(A) to store or produce telephone numbers to be called, using a random or
sequential number generator; and
(B) to dial such numbers.
47 U.S.C. § 227(a)(1).
Therefore, Respondent asserts that the means by which Petitioner
transmitted the messages for US Coachways is necessary to determine whether that means
constituted an “automatic telephone dialing system” under the TCPA. See Respondent’s Brief,
D.E. 4, at 12.
Respondent further argues that Petitioner’s call records for US Coachways are necessary to
determine whether Plaintiff can satisfy the requirements for class certification under Rule 23. See
id.
The call records will allow Respondent to determine how many individuals Petitioner
contacted for US Coachways via cellular telephone, how many of those contacted were on the
National Do Not Call Registry, and therefore how many potential violations occurred for each of
the two proposed classes. See id. at 13-14.
Respondent also takes issue with the “Attorneys’ Eyes Only” provision on which
Petitioner seeks to predicate production of materials in response to the Request. See id. at 14-15.
Respondent contends that such a provision was not made a part of the protective order in the
underlying litigation, and is not necessary now, because Petitioner and Respondent are not direct
competitors. See id.
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III.
Analysis
Subpoenas served under Federal Rule of Civil Procedure 45 must meet the standards for
discovery under Federal Rule of Civil Procedure 26(b)(1). Schmulovich v. 1161 Rt. 9 LLC, Civ.
No. 07-597, 2008 WL 4572537, *4 (D.N.J. Oct. 14, 2008). Under Rule 26(b)(1), “[p]arties may
obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or
defense.” Rule 26(b)(1) also provides that “the court may order discovery of any matter relevant
to the subject matter involved in the action. Relevant information need not be admissible at the
trial if the discovery appears reasonably calculated to lead to the discovery of admissible
evidence.”
The purpose of discovery is to uncover facts about the claims and defenses set forth in the
pleadings and thus the boundaries of relevance under Rule 26 depend upon the context of each
action. See Salamone v. Carter’s Retail, Inc., Civ. No. 09-5856, 2011 WL 1458063, at *2 (D.N.J.
Apr. 14, 2011); accord Hickman v. Taylor, 329 U.S. 495, 507 (1947). The determination of
relevance is within the court’s discretion.
Salamone, 2011 WL 1458063, at *2. “Mutual
knowledge of all the relevant facts gathered by both parties is essential to proper litigation.”
Hickman, 329 U.S. at 507. It allows each party to have a fair opportunity to present an effective
case at trial. Halpin v. Barnegat Bay Dredging Co., Civ. No. 10-3245, 2011 WL 2559678, at *10
(D.N.J. June 27, 2011) (collecting cases).
Accordingly, courts construe Rule 26 “broadly to encompass any matter that bears on, or
that reasonably could lead to other matters that could bear on, any issue that is or may be in the
case.” Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 351 (1978). However, Rule 26 does
not permit the parties to “‘go fishing’” and, in fact, “‘the trial court retains discretion to determine
that a discovery request is too broad and oppressive.’” Schneck v. IBM, Civ. No. 92-4370, 1993
WL 765638, *2 (D.N.J. July 27, 1993) (quoting Marshall v. Westinghouse, 576 F.2d 588, 591 (5th
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Cir. 1978)).
In this case, Respondent’s contention that at least some of the discovery sought is relevant
to the underlying action is well taken. For example, for Respondent to establish a meritorious
cause of action under the TCPA, it will need to prove that US Coachways transmitted its
advertisements, or caused those advertisements to be transmitted, using an “automatic telephone
dialing system” to call a number that has been assigned to a cell service. 47 U.S.C. §§ 227(a)(1)
& (b)(1)(A)(iii)). Therefore, the manner by which Petitioner transmits the advertisements on
behalf of US Coachways is clearly relevant. Respondent points out that only Gold Mobile has
that information, and Gold Mobile does not disagree.
Some degree of information about other individuals to whom Gold Mobile transmitted
advertisements on behalf of US Coachways also may be relevant.
To succeed in its
class-certification application under Rule 23, Respondent will need to establish:
(1) the class is so numerous that joinder of all members is impracticable,
(2) there are questions of law or fact common to the class,
(3) the claims or defenses of the representative parties are typical of the claims or
defenses of the class, and
(4) the representative parties will fairly and adequately protect the interests of the
class.
Fed. R. Civ. P. 23(a). See Cannon v. Cherry Hill Toyota Inc., 184 F.R.D. 540, 543 (D.N.J. 1999).
These factors are “prerequisites for maintaining any class action in terms of the numerousness of
the class making joinder of the members impracticable, the existence of common questions to the
class, and the desired qualifications of the representative parties.” Fed. R. Civ. P. 23, Advisory
Committee Notes, 1966.
Therefore, it is reasonable to conclude that Respondent will be entitled to at least some
discovery regarding the number of individuals to whom Gold Mobile sent text-message
advertisements on behalf of US Coachways. That information will likely be critical to
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Respondent’s ability to establish numerosity. Similarly, Respondent may well be entitled to the
messages that Petitioner sent on behalf of US Coachways, insofar as both the manner in which
those texts were transmitted and the substance of those messages is likely relevant to the issues of
commonality and typicality.
Although Request No. 1 includes legitimately discoverable items, it is far too broad. The
subpoena’s use of the term “data” is extraordinarily open-ended and can fairly be construed to
encompass significantly more information than the items discussed above.
As Petitioner
observes, “data” could include “internal communications among [its] employees” that, at best, is
of marginal relevance. Petitioner’s Reply Brf., D.E. 7, at 2. Indeed, Request No. 1 could be read
to demand even the most picayune information regarding system maintenance, as long as that
system transmitted US Coachways’ advertisements. Moreover, Respondent’s opposition to the
motion to quash does little to clarify or narrow the scope of “data.”
Similarly, the subpoena has no temporal limitation. The two putative classes are limited
to four years, consistent with the statute of limitations for the TCPA. 28 U.S.C. § 1658; Bais
Yaakov of Spring Valley v. Alloy, Inc., 936 F. Supp. 2d 272, 281 (S.D.N.Y. 2013) (noting that
TCPA did not contain statute of limitations, and applying general four-year limitations period
under § 1658, rather than state statute of limitations, to TCPA claim). However, the subpoena is
completely silent on timeframe.
Moreover, that Respondent is entitled to discovery on the elements of class certification
does not necessarily entitle him, at this stage, to the specific names and contact information for
each individual whom Gold Mobile contacted on US Coachway’s behalf.1 Respondent avers that
the court in the underlying litigation already addressed this issue because it did not bifurcate class
and merits discovery. Respondent’s Brf., D.E. 4, at 8. But that argument elides the point. The
1
In certain contexts, Title 47 restricts the release of specific identifying information for customers.
See, e.g., 47 U.S.C. § 551(c) (governing disclosure of personally identifiable information for cable
subscribers). Neither party has raised a similar limitation under Title 47 here.
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fact that Respondent is entitled to discovery necessary to move for class certification, and on the
merits of its claims, does not necessarily mean it is entitled, at this point, to personally identifiable
information for all individuals who might have received an advertisement from US Coachways,
before the certification has even been granted. It may be that for purposes of numerosity, for
example, it is sufficient for Plaintiff to know the total number of individuals who received, within
the four-year limitations period, text advertisements from US Coachways similar to Plaintiff’s.
Similarly, for purposes of commonality and typicality, Respondent fails to explain why the texts
themselves and the manner in which they were delivered, would be insufficient.2 However, the
subpoena makes no such distinction; nor does Respondent offer one in opposing the motion to
quash.
Respondent’s contention that an “Attorneys Eyes Only” designation is inappropriate here because
the confidentiality order in the Northern District of Illinois litigation contains no such provision overlooks
the fact that Petitioner is not a party to that case or that confidentiality order. Moreover, there is no
suggestion that Petitioner had any opportunity to be heard on the substance of the confidentiality order
before it was entered.
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Respondent’s argument that an “Attorneys Eyes Only” designation is unnecessary presupposes that
such a designation is appropriate only where the party providing the discovery and the party receiving the
discovery are direct competitors. That position is not well taken. Federal Rule of Civil Procedure
26(c)(1)(G) authorizes the court to “requir[e] that a trade secret or other confidential research, development,
or commercial information not be revealed or be revealed only in a specified way[.]” Neither Rule
26(c)(1)(G), nor caselaw within the Third Circuit, nor Local Civil Rule 5.3, limits an “Attorneys Eyes
Only” designation to proprietary information shared between direct competitors. See, e.g., Carchietta v.
Russo, Civ. No. 11-7587, 2014 WL 1789459, *7 (D.N.J. May 6, 2014) (ordering production of police
internal affairs files in civil rights litigation under “Attorneys Eyes Only” designation); Grant Heilman
Photography, Inc. v. Pearson Educ., Inc., Civ. No. 11-4649, 2012 WL 1956787, *1-2 (E.D. Pa. May 31,
2012) (production of defendant’s print quality report for “Attorneys Eyes Only”); Graham v. Carino, Civ.
No. 09-4501, 2010 WL 2483294, *3-4 (D.N.J. June 4, 2010) (ordering “Attorneys Eyes Only” production
of municipal defendants’ financial records to counsel for plaintiff claiming excessive force and seeking
punitive damages).
Here, the Allen Declaration is not especially specific regarding the harm it would suffer if its
proprietary information became public, or the measures it has taken to protect that information. See, e.g.,
Allen Decl. at ¶ 8. However, it sets forth a sufficient factual basis to allow for the possibility that any
material reflecting the manner in which Petitioner transmitted US Coachways’ advertisements should be
produced for “Attorneys Eyes Only.” Accordingly, in meeting and conferring regarding the manner in
which Petitioner will produce responsive material in response to Request No.1, the parties shall revisit the
use of a discovery confidentiality order that includes an “Attorneys Eyes Only” provision. If the parties
still cannot reach an agreement, they shall resubmit that issue to the Court in the form of a joint letter, on or
before July 15, 2015. Petitioner will include a new declaration setting forth in greater detail the nature of
the potential harm and its efforts to keep the information confidential.
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Accordingly, the Court grants in part and denies in part the Petitioner’s motion to quash
[D.E. 2]. The Court denies the motion insofar as Request No. 1 seeks information, for the four
years before the filing of the complaint, about: (1) the total number of individuals who received
text advertisements from US Coachways similar to Plaintiff’s; (2) the substances of those text
messages sent on behalf of US Coachways; and (3) the manner by which Petitioner delivered those
text messages on behalf of US Coachways. The Court grants the motion to quash to the extent
Request No. 1 seeks additional discovery.
However, to the extent Respondent seeks any
additional material from Petitioner, it shall meet and confer with Petitioner in an attempt to resolve
the issue without additional court intervention. If the parties cannot resolve the issue through the
meet and confer, they shall present the issue to the Court in the form of a joint discovery letter, on
or before July 15, 2015.
/s Michael A. Hammer
UNITED STATES MAGISTRATE JUDGE
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