Bank v. American Home Shield Corporation

Filing 48

ORDER denying 44 Plaintiff's Motion for Discovery. Because Plaintiff has not justified his failure to timely obtain the documents he now seeks to subpoena, and because of the undue and unfair prejudice that would result if he were permitted to do so at this time, the Court denies Plaintiff's request for leave to serve a third-party subpoena. Ordered by Judge Pamela K. Chen on 2/5/2014. (Galeotti, Matthew)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
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TODD C. BANK, individually and on behalf of all
others similarly situated,
Plaintiff,
MEMORANDUM & ORDER
10-CV-4014 (PKC)

-against-

AMERICAN HOME SHIELD CORPORATION,
Defendant.
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PAMELA K. CHEN, United States District Judge:
Pending before the Court is the request of Plaintiff Todd C. Bank for leave to serve a
subpoena duces tecum upon “the former president and chief operating of an entity called
Webjuice, LLC,” despite the period for discovery having closed on October 31, 2013. (Dkt. 44
at 1.) For the reasons set forth below, Plaintiff’s request is DENIED.
I.

BACKGROUND
On September 1, 2010, Plaintiff filed this class action lawsuit alleging violations of the

California Anti-Spam statute.1 (Dkt. 1 at ¶¶ 2, 3, 18.) The initial complaint alleged, inter alia,
that on or about April 5, 2010, Defendant American Home Shield (“AHS”) “sent, or caused to be
sent, to Plaintiff, an ‘unsolicited commercial electronic-mail advertisement[,]’” and that AHS
sent the same advertisement “to at least 10,000 valid e-mail addresses.” (Id. at ¶¶ 8, 12.) In the
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California Business & Professions Code § 17529.5 imposes civil liability on those who
“advertise in a commercial email advertisement either sent from California or to a California
electronic mail address if, inter alia, “[t]he e-mail advertisement has a subject line that a person
knows would be likely to mislead a recipient, acting reasonably under the circumstances, about a
material fact regarding the contents or subject matter of the message.” § 17529.5(a)(3).
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“Class Allegations” section of the complaint, Plaintiff re-alleged that “[t]here are more than
10,000 individuals and entities whose claims are similar to Bank’s claims” (id. at ¶ 23), and
further asserted that:
“A class action is superior to all other available methods for the fair and efficient
adjudication of this controversy. Because the Class is so numerous that joinder of all
Members of the Class is impracticable, and because the damages suffered by most of the
individual Members of the Class are too small to render prosecution of the claims
asserted herein economically feasible on an individual basis, the expense and burden of
individual litigation makes it impractical for Members of the Class to adequately address
the wrongs complained of herein.”
(Id. at ¶ 25.) In addition, as required to establish jurisdiction under the Class Action Fairness Act
(“CAFA”), 28 U.S.C. § 1332(d)(2)(A), Plaintiff alleged that the “matter in controversy exceeds
the sum or value of $5,000,000, exclusive of interest and costs.” Id. at ¶ 4.2
On January 5, 2012, Plaintiff filed a Second Amended Complaint, which contained
significantly more detailed factual allegations, including the following:
“On or about April 5, 2010, AHS, through a third party, sent, from California, an
electronic-mail message (“e-mail”) to Bank[.]” (Dkt. 13 at ¶ 8.)
“To at least ten thousand e-mail addresses during the period beginning one year prior to
the commencement of this action and continuing to the present, AHS has sent, from
California, e-mails that contained the same subject line that appeared in the e-mails that
AHS sent to Bank (with the exception that the date in the subject line, in many cases,
might have differed from either of the dates that appeared in the subject line of the emails that AHS sent to Bank) and the same body as did the e-mails that AHS sent to
Bank.” (Id. at ¶ 17.)
“At least ten thousand e-mail addresses to which AHS sent the e-mails described in the
preceding paragraph belonged to individuals or entities that, prior to their receipt of the emails that AHS sent to them, had not provided direct consent to AHS or any other
individual or entity to receive the e-mails; had not made an inquiry regarding products or
services offered by either AHS or any other individual or entity; had not provided their email addresses to either AHS or any other individual or entity; and had not made an
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Because the California Anti-Spam statute only provides for liquidated damages in the amount
of $1,000 per plaintiff, the complaint’s allegations regarding 10,000 or more putative class
members was essential to establishing jurisdiction under CAFA. See Cal. Bus. & Prof. Code §
17529.5(a)(3) (liquidated damages provision).
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application, purchase, or transaction, with or without consideration, regarding products or
services offered by either AHS or any other individual or entity.” (Id. at ¶ 18.)
Notably, the amended complaint also identified the California-based sender of the e-mails as
“EclipseMediaOnline.” (Id. at ¶10, Exhibit A.)
On May 14, 2013, following AHS’s failed motion to dismiss the complaint (Dkt. 26), the
parties met with Magistrate Judge Ramon E. Reyes for a scheduling conference. The discovery
schedule set at the conference provided for all discovery to be completed by November 1, 2013.
AHS states that its attorneys specifically advised Plaintiff at the conference that Webjuice was
involved in sending the e-mail at issue. (Dkt. 43 at 1.) Plaintiff disputes this assertion, claiming
that he “first learned of the name Webjuice when AHS served its Rule 26 disclosures on July 18,
2013.” (Dkt. 46 at 3.) In any event, on July 18, 2013, AHS served its Rule 26 initial disclosures
on Plaintiff, which indicated, inter alia, that Webjuice had information relevant to this action and
also provided Webjuice’s Warren Street address in California. (Dkt. 43 at 1; Dkt. 46 at 3.) On
August 29, 2013, during the deposition of Trafford Seymour, an AHS representative, Plaintiff
asked questions about Webjuice, but the witness testified that he did not know if Webjuice had
sent the AHS e-mails. (Dkt. 44, Exhibit F at. 23, 29, 46-47.)
Despite knowledge of their relevance, Plaintiff did not seek to subpoena records from
Webjuice until October 29, 2013, two days before the close of discovery. (Dkt. 44 at 2; Dkt. 43
at 1.) At that time, Plaintiff attempted service of the Webjuice subpoena at an address listed with
the California Secretary of State, which turned out to be incorrect. (Dkt. 44 at 2.) On November
22, 2013, three weeks after the close of discovery, Plaintiff attempted to re-serve the Webjuice
subpoena, this time using the Warren Street address that AHS had provided in July 2013. (Id.)
AHS moved to quash the subpoena as untimely, but Judge Reyes denied AHS’s motion, finding
that AHS was not prejudiced by Plaintiff’s belated document subpoena. (Order dated 12/06/13;
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Dkt. 40 (describing the subpoena as one for “information or documents”).) Plaintiff apparently
did not receive any response to the second Webjuice subpoena because, according to Plaintiff,
Webjuice has not been in operation since at least January 21, 2014. (Dkt. 44 at 1.)
On January 8, 2014, the parties appeared before the Court for a pre-motion conference
relating to AHS’s proposed summary judgment motion. At the conference, the Court questioned
Plaintiff about the basis for his the allegation in the Second Amended Complaint that AHS sent
“[t]o at least ten thousand e-mail addresses during the period beginning one year prior to the
commencement of this action and continuing to the present . . . e-mails that contained the same
subject line as the e-mails AHS sent to Bank[.]” (Dkt. 13 at ¶ 17.) In substance, Plaintiff
acknowledged that, at the time he filed the complaint, he did not have specific or direct
information about the number or identity of the recipients of the e-mail, but that, based on his
general research about e-mail advertising and marketing, he had a “good faith” basis for
believing that at least 10,000 individuals had received it.3
At the conclusion of the conference, the Court granted AHS leave to file a motion for
summary judgment and set the following briefing schedule, pursuant to which AHS will serve
their motion on Plaintiff on February 6, 2014, and will conclude on March 20, 2104, when the
parties file their submissions with the Court. Plaintiff stated he would not seek to delay or
adjourn the summary judgment briefing schedule on the basis of his then-outstanding second
attempted subpoena to Webjuice. (Dkt. 44 at 3 (Plaintiff reiterating that he has “not proposed a
delay in the briefing schedule of AHS’s summary-judgment motion”).)

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The Court did not ask Plaintiff about the basis for his allegations that the recipients of the email had not (1) provided direct consent to receive the e-mail, (2) made any inquiry about the
products or services offered by AHS, (3) provided their e-mail addresses to AHS, or (4) made an
application, purchase or transaction regarding products or services offered by AHS. (Id. at ¶ 19.)
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II.

DISCUSSION
A.

Legal Standard

A district court has broad discretion “to direct and manage the pre-trial discovery
process.” Wills v. Amerada Hess Corp., 379 F.3d 32, 41 (2d Cir. 2004). As part of that
discovery process, Rule 16(b) of the Federal Rules of Civil Procedure requires district courts to
enter scheduling orders that limit the parties’ time to complete discovery. Fed. R. Civ. P.
16(b)(3). The order “shall not be modified except upon a showing of good cause” and only by
leave of the district judge. Id.; 6A Charles Alan Wright, Arthur R. Miller, and Mary Kay Kane,
Federal Practice and Procedure § 1522.1 (2d ed. 1990); George v. Ford Motor Co., 03-CV7643 (GEL), 2007 WL 2398806, at *12 (S.D.N.Y. Aug.17, 2007) (noting that discovery is
governed by the scheduling order and “may not be conducted after the close of discovery absent
good cause to modify that order.”). Whether good cause exists “depends on the diligence of the
moving party.” Grochowski v. Phoenix Const., 318 F.3d 80, 86 (2d Cir. 2003); see also McKay
v. Triborough Bridge & Tunnel Auth., 05-CV-8936 (RJS), 2007 WL 3275918 (S.D.N.Y. Nov. 5,
2007) (citing Fed. R. Civ. P. 16 Advisory Committee’s Note (party seeking modification must
show that the deadline could not “reasonably be met despite the diligence of the party seeking”
modification); Wright, Miller, and Kane, supra § 1522.1; see also Vilkhu v. City of New York, 06
Civ.2095 (CPS), 2007 WL 2713340, at *5 (E.D.N.Y. Sept. 13, 2007) (noting that, in assessing
good cause, the Court should consider several factors, including “the diligence vel non of the
party requesting an extension, bad faith vel non of the party opposing such extension, the phase
of the litigation and prior knowledge of and notice to the parties”) (internal citations and
quotations omitted)).

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B.

Plaintiff’s Subpoena Request

Plaintiff seeks leave to subpoena documents from the former president and chief
operating office of Webjuice three months after the close of discovery. (Dkt. 44-9.) Plaintiff
offers no justification for his failure to comply with the discovery deadline in obtaining
information from Webjuice, whose involvement in this case he has been aware of since at least
July 2013. Rather, Plaintiff argues that his original subpoena seeking these documents was filed
two days before the end of discovery and that AHS is not prejudiced by the service of the same
subpoena after discovery. Given the current posture of this case, the Court does not find
Plaintiff’s arguments compelling or persuasive. See Dunkin’ Donuts Franchised Restaurants,
LLC v. 1700 Church Ave. Corp., 07-CV-2446 (CBA) (MDG), 2008 WL 1947079 (E.D.N.Y.
Apr. 24, 2008) (“When a [party] is aware of the existence of documents before the discovery
cutoff date and issues discovery requests including subpoenas after the discovery deadline has
passed, then the subpoenas and discovery requests should be denied.”) (citation and quotation
marks omitted).
In seeking to make a third attempt to subpoena Webjuice, Plaintiff cites Judge Reyes’
prior ruling that Plaintiff’s second attempt to serve the subpoena was not prejudicial to AHS.
(Dkt. 44 at 3.) However, there are critical differences between the situation that existed at the
time of Judge Reyes’s ruling and now. Plaintiff’s second subpoena attempt was made three
weeks, not three months, after the close of discovery, and not in the midst of summary judgment
briefing. AHS will serve its summary judgment motion on Plaintiff February 6, 2014, and that
motion will be fully briefed by March 20, 2014. Permitting Plaintiff to conduct additional
discovery in the midst of summary judgment briefing would clearly prejudice AHS and could
result in the gross and inexcusable waste of the parties’ and the Court’s resources for at least

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three reasons.

First, there is little possibility that Plaintiff would receive the requested

documents in time to make use of them without reneging on his representation that he would not
seek to extend the briefing schedule to permit the introduction of the belatedly obtained
evidence. Second, even if Plaintiff received documents from Webjuice, they would have to be
authenticated, presumably through a deposition of the former Webjuice officer, before they could
be considered by the Court in connection with the summary judgment proceedings. See Raskin
v. Wyatt Co., 125 F.3d 55, 66 (2d Cir. 1997) (“[O]nly admissible evidence need be considered by
the trial court in ruling on a motion for summary judgment.”); Fed. R. Civ. P. 56(e); Axelrod &
Cherveny, Architects, P.C. v. T. & S. Builders Inc., 943 F. Supp. 2d 357, 363 (E.D.N.Y. 2013)
(“authentication ‘is a precondition to consideration of documentary evidence on summary
judgment.’”) (quoting Jay Dees Inc. v. Def. Tech. Sys., Inc., 2008 WL 4501652, at *6 (S.D.N.Y.
Sept. 30, 2008)). Third, AHS has drafted and served its opening brief without the benefit of any
Webjuice documents, and would, at a minimum, have to re-brief their motion, which would be
unfair and unduly burdensome.
The Court acknowledges that, as Plaintiff argues, the Webjuice documents may well be
relevant to his claims. If, in fact, Webjuice is responsible for sending the subject e-mail to
Plaintiff and others, and had a contract with AHS or its agent to do so, these documents could be
vital to establishing and defining the class, thereby meeting the CAFA jurisdictional requirement.
However, the potential relevance of these documents was known to Plaintiff in July 2013, and
yet he failed to take any action to obtain this information until two days before the close of
discovery.
Plaintiff has failed to diligently and responsibly pursue this litigation, which has been
pending for over three years. Plaintiff knew before he filed this lawsuit in September 2010 that it

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was critical for him to obtain evidence as to the number and identity of the other purported
recipients of the e-mail at issue and putative class members. As he admitted at the January 8,
2014 conference, at the time he filed the lawsuit, he had no specific information about who or
how many others received the same e-mail but held only a “good faith” belief that at least 10,000
individuals or entities had. As Plaintiff is well aware, this evidence is necessary for him to meet
the $5,000,000 jurisdictional threshold under CAFA. Yet, he appears to have done nothing until
two days before the close of discovery, more than three years later, to obtain this vital evidence,
despite having the necessary information to do so at least as of July 2013.4 Nothing prevented
Plaintiff from attempting to subpoena the Webjuice documents then, and Plaintiff offers no
justification for failing to do so. Plaintiff also offers no information regarding his efforts to
obtain the documents after initially attempting to subpoena them in October 2013, including
explaining why he is just now, in February, 2014, learning that the company is no longer in
operation. Thus, Plaintiff has not demonstrated the diligence required to upset the Court’s
discovery schedule. See Parker v. Columbia Pictures Indus., 204 F.3d 326, 339-40 (2d Cir.
2000) (holding that a party seeking relief from the discovery schedule must demonstrate
diligence and otherwise demonstrate good cause).
While it is true that Plaintiff served his initial subpoena for the Webjuice documents
before the end of discovery, by waiting until almost the last day to do so, he ensured that any
additional or related discovery would have to be conducted outside the discovery period and
would threaten, as it has, to interfere with the filing of dispositive motions. Plaintiff chose at his

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Indeed, Plaintiff conceivably could have determined long before July 2013 that Webjuice was
involved in sending the email since he knew at the time he received the email that it was sent by
EclipseMediaOnline. (Dkt. 13 at ¶ 10, Exhibit A.) There is no indication that Plaintiff sought to
subpoena EclipseMediaOnline at any point during the litigation, or that he sought to investigate
on his own the identity of the sender of the e-mail.
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own peril to wait, and the dilemma he finds himself in is self-created. He must now accept the
consequences of that decision.
III.

CONCLUSION
Because Plaintiff has not justified his failure to timely obtain the documents he now seeks

to subpoena, and because of the undue and unfair prejudice that would result if he were
permitted to do so at this time, the Court denies Plaintiff’s request for leave to serve a third-party
subpoena.
SO ORDERED:

/s/
PAMELA K. CHEN
United States District Judge
Dated: February 5, 2014
Brooklyn, New York

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