Inventiv Health Consulting, Inc. v. French et al

Filing 63

ORDER granting in part and denying in part 33 Motion to Compel; granting 38 Motion to Seal; granting 42 Motion for Extension of Time to Complete Discovery; granting 48 Motion to Seal; granting 52 Motion to Compel; granting 57 Motion to Seal Document. Signed by US Magistrate Judge Robert B. Jones, Jr on 2/12/2020. (Sellers, N.)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF NORTH CAROLINA
WESTERN DIVISION
No. 5:18-CV-295-D
INVENTIV HEAL TH
CONSULTING, INC.,
Plaintiff,
V.

ALAND. FRENCH, JR., et al.,
Defendants.

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ORDER

This matter is before the court on the following motions: (1) Plaintiffs motion to compel
discovery from Defendant Alan D. French, Jr. ("Defendant French" or "French"), [DE-33],
(2) Defendant French's motion to seal an exhibit to the Declaration of Melanie Black Dubis, [DE38], (3) Plaintiffs motion for an extension of time to complete discovery, [DE-42],
(4) Defendants' motion to seal an exhibit to their response in opposition to Plaintiffs motion for
an extension ohime, [DE-48], (5) Plaintiffs motion to compel electronically stored information
("ESI") front Defendants, [DE-52], and (6) Defendants' motion to seal exhibits to their response
in opposition to Plaintiffs motion to compel ESI, [DE-57]. Defendant French responded to
. Plaintiffs motion to compel, [DE-35], Defendants responded to Plaintiffs motion for an extension
ohime, [DE-45], and Defendants responded to Plaintiffs motion to compel ESI, [DE-54]. The
court held a telephonic hearing on February 10, 2020. The issues have been fully briefed, and the
motions are ripe for decision. For the reasons stated below, Plaintiffs motion to compel is allowed
in part and denied in part, Plaintiffs motion to compel ESI is allowed, Defendants' motions to seal
are allowed, and Plaintiffs motion for an extension of time is allowed.

I. BACKGROUND

This action arises from Plaintiffs allegations that Defendants left their employment with
Plaintiff to start a competing business in violation of an employment ~greement. Compl. [DE-1]
at 1. Plaintiff has asserted claims of breach of employment contract, tortious interference with
contractual relations, tortious interference with prospective future contracts, trade ~ecret
misappropriation, unfair or deceptive trade practices, civil conspiracy, breach of fiduciary duty,
and constructive fraud. Id at 22-34.
According to the complaint, Plaintiff is a strategic management consulting business in the
pharmaceutical and biotech industry. Id at 5. Defendant French was employed by Plaintiff as a
managing director, and the other Defendants worked on French's team. Id at 7. Their role was
to build client relationships using Plaintiffs confidential information, particularly with respect to
Clients A and B, two of Plaintiffs largest clients. Id at 7-8. Plaintiff and Defendants entered into
employment contracts that protect Plaintiffs confidential information and contain noncompete
agreements. Id at 9-11. The "non-competition period" is defined in the contracts as the twelve
month period following termination of employment, and the "non-solicitation period" is defined
as the eighteen month period following termination of employment. [DE-1-1] at 3. Additionally, .
the contracts provide that the non-competition and non-solicitation periods do not run during any
time period when the employee is not in compliance with the terms of the contract. Id
The complaint alleges further that while still employed by Plaintiff, Defendants covertly
launched a new business, Equitas. Compl. [DE-1] at 12. In early 2016, Plaintiff saw a decline in
revenue from Clients A and B. Id at 15. French reported to Plaintiff that Client A's need for
consulting services had diminished; however, according to Plaintiff, French was performing work
for Client A on behalf of Equitas. Id In February 2016, French switched to a part-time schedule

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at inVentiv, and he resigned from inVentiv in July 2016. Id. The other Defendants also resigned
serially in 2016, each. citing personal reasons for their resignations. Id. at 16-17. Defendants all
began officially working for Equitas soon after their resignations from inVentiv. Id. at 17.
Plaintiff discovered Equitas's work for Client A when Client A mistakenly sent a calendar
invitation and email to French's inVentiv email address in January 2017. Id. at 18. Plaintiff
conducted a forensic analysis of Defendants' inVentiv computers and discovered that two days
before French's resignation, French accessed confidential information and inserted a USB device
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into the computer. Id. at 19. Plaintiff alleges that Defendants have breached their employment
agreements by diverting clients from inVentiv to Equitas and by using inVentiv's confidential
information. Id. at 20.
Plaintiff first brought a suit against French, four other individual defendants, and Equitas
in Massachusetts state court (the "Massachusetts action"). Def.'s Resp. [DE-35] at 1. Several
individual defendants were dismissed, and Plaintiff filed the present action in this federal district.

Id. - The Massachusetts action remains pending against one individual defendant and Equitas. Id.
Plaintiff also filed an action in federal court in New Jersey (the "New Jersey action") against an
individual defendant. Id. In order to re4uce duplicity in discovery, the Defendants in the present
action, the Massachusetts action, and the New Jersey action proposed that discovery could be
shared by all litigants in the three cases. Id. at 2-3. Plaintiff agreed to Defendants' proposal on
September 27, 2019. Id. at 3.
On April 2, 2019, Plaintiff served the Requests for Production of Documents ("RFP") at
issue here on French. Id. at 2; [DE-33-1]. Following French's response, Plaintiff's counsel sent a
letter on August 20, 2019, outlining purported deficiencies in his discovery responses and
requesting counsel's availability to meet and confer to discuss the various responses. [DE-34-1].

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The parties conferred by phone on August 30, 2019, and French's counsel supplemented French's
objections and answers on September 23, 2019.

[DE-34-2].

On September 26, 2019, the

Massachusetts Superior Court ruled in the Massachusetts action that Equitas must produce
documents regarding Equitas's agreements with Clients A and B as well as Equitas's financial
information. [DE-36-5]. Plaintiff filed the instant motion to compel on October 1, 2019. [DE33]. Plaintiffs motion seeks an order compelling responses to Requests 3, 7-10, 15, 31, 33, 3541, 43--44, 54-57, 60, 70-72, 77, 78, 83-85, 100-104, 107-123, 126, and 129. Pl.'s Mot. [DE33] at 1. However, Plaintiffs memorandl.11n discusses only Requests 31, 54, 55, 77, 78, 85, 10004, 107-20. Pl. 's Mem. [DE-34] at 7-11. From the parties' communications, it appears that the
disputes regarding Requests 3, 7-10, 33, 35--41, 43, 44, 56, 57, 60, 70-72, 83, 84, 121-23, 126,
and 129 have been resolved. [DE-34-2] at 2--4. Accordingly, Requests 31, 54, 55, 77, 78, 85,
100~4, 107-20 are presently disputed in Plaintiffs first motion to compel and discussed below,
as well as French's general objections to the RFP.

II. STANDARD OF REVIEW
Rule 26(b)(1) of the Federal Rules of Civil Procedure provides the general rule regarding
the scope of discovery. "Parties may obtain discovery regarding any nonpriv_ileged matter that is
relevant to any party's claim or defense and proportional to the needs of the case." Fed. R. Civ.
P. 26(b)(l). "Relevancy under this rule has been broadly construed to encompass any possibility
that the information sought may be relevant !O the claim or defense of any party." Equal Emp 't

Opportunity Comm 'n , v. Sheffield Fin. LLC, No. 1:06-CV-889, 2007 WL 1726560, at *3
(M.D.N.C. June 13, 2007); Mainstreet Collection, Inc. v. Kirkland's, Inc., 270 F.R.D. 238, 240
(E.D.N.C. 2010) ("During discovery, relevance is broadly construed 'to encompass any matter that

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bears on, or that reasonably could lead to other matter that could bear on, any issue that is or may
be in the case."') (quoting Oppenheimer Fund, Inc. v. Sanders, 437 D.S. 340,351 (1978)).
Rule 37 of the Federal Rules of Civil Procedure provides that "[a] party seeking discovery
may move for an order compelling an answer, designation, production, or inspection" if a party
fails to produce or make available for inspection requested documents under Rule 34. Fed. R. Civ.
P. 37(a)(3)(B)(iv). For purposes of a motion to compel, "an evasive or incomplete disclosure,
answer, or response must be treated as a failure to disclose, answer, or respond." Fed. R. Civ. P.
37(a)(4). However, the Federal Rules also provide that
the court must limit the frequency or extent of discovery otherwise allowed by these
rules or by local rule if it determines that: (i) the discovery sought is unreasonably
cumulative or duplicative, or can be obtained from some other source that is more
convenient, less burdensome, or less expensive; (ii) the party seeking discovery has
had ample opportunity to obtain the information by discovery in the action; or (iii)
the proposed discovery is outsid~ the scope permitted by Rule 26(b)(l).
Fed. R. Civ. P. 26(b)(2)(C). "Additionally, the court has 'substantial discretion' to grant or deny
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motions to compel discovery." English v. Johns, No. 5:11-CT-3206-D, 2014 WL 555661, at *4
(E.D.N.C. Feb. 11, 2014) (quoting Lone Star Steakhouse & Saloon, Inc. v. Alpha of Va., Inc., 43
F.3d 922, 929 (4th Cir. 1995)). Finally, the party seeking the court's protection from responding
to discovery "must make a particularized showing of why discovery should be denied, and
conclusory or generalized statements fail to satisfy this burden as a matter of law." Mainstreet

Collection, 270 F.R.D. at 240 (citation omitted). Accordingly, as the party resisting discovery, it
is French's burden to show why discovery should be denied.
III. DISCUSSION
A. Plaintiff's Motions to Compel
The parties dispute five issues regarding French's response to the RFP: (1) whether the
deadline for production of documents was September 20, 2019; (2) whether French is in

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possession, custody, or control of documents contained in his Equitas corporate email account;
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(3) whether French must produce documents regarding projects commenced after July 25, 2017;
(4) whether non-privileged, responsive documents to Requests 31, 54, 55, 77, 78, 85, 100-04, 10720 must be produced; and (5) whether Defendants must produce ESI for inspection by an
independent forensic vendor pursuant to a protocol proposed by Plaintiff.
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I
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1. The Deadline for Production

Plaintiff contends that during the parties' August 30, 2019 meet and confer, French's
attorney pledged to produce responsive documents by September 20, 2019. Pl.'s Mem. [DE-34]
·at 5. Accordingly, Plaintiff argues, French sho_uld produce responsive documents immediately.

Id Plaintiff cites a letter froin French's counsel dated September 12, 2019; however, nowhere in
the letter does French's counsel pledge to produce responsive documents by a certain date. [DE_;

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34-2]. French claims that he did not agree to a production date of September 20, 2019, and
Plaintiffs "incorrect belief' that he so agreed "was corrected." Def. 's Resp., [DE-35] at 4.
Given the ambiguity regarding whether the parties agreed to a production date of
September 20, 2019, the court declines to order French to produce responsive documents
immediately. Instead, the deadline for French to produce the documents discussed below is by no
later than twenty-one days ofthis order.
2. French's Possession, Custody, or Control of His Equitas Email Account

French contends that documents contained in his Equitas corporate email account are not
within his possession, custody, or control, and Plaintiff should either subpoena those documents
from Equitas or conduct discovery in the Massachusetts action, in which Equitas is a party. Def.' s
Resp. [DE-35] at 5-6. Plaintiff contends that French has possession, custody, or control of the
documents in his Equitas email account because French is a founding member and current

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employee of Equitas, and he has used his Equitas email account to conduct the business he is
alleged to have done in breach of his employment agreement. Pl. 's Mem. [DE-34] at 5-6.
Fed. R. Civ. P. 34(a)(l) limits production to documents that are "in the responding party's
possession, custody, or control." To determine whether documents belonging to a non-party are
in the possession, custody, or control of a party, this court has utilized a legal-right-to-control test.

See Ultra-Mek, Inc. v. Man Wah (USA), Inc., 318 F.R.D. 309,312 (M.D.N.C. Dec. 28, 2016); In
re: NC Swine Farm Nuisance Litigation, No. 5:15-CV-13-BR, 2016 WL 3661266, at *3 (E.D.N.C.
July 1, 2016); Suh v. HCA-The Healthcare Co., No. 7:02-CV-166-F, 2010 WL 11622620, at *2
(E.D.N.C. May 11, 2010); Bleecker v. Standard Fire ins. Co., 130 F. Supp. 2d 726, 739 (E.D.N.C.
2000). Courts examine the degree of authority the responding party possesses over the non-party.

See Ultra-Mek, 318 F.R.D. at 313; Swine Farm Nuisance Litigation, 2016 WL 3661266, at *4. It
is the requesting party's burden to show thatthe responding party has control over the documents.

Prodigious Ventures, Inc. v. YBE Hosp. Grp., LLC, No. 5:14-CV-433-F, 2016 WL 1248806, at *4
(E.D.N.C. Mar. 25, 2016) (citations omitted). Accordingly, it is Plaintiffs burden to show that
French has sufficient.control over Equitas such that he has the legal right to control the documents
in the email account. See id
During the February 10, 2020 telephonic hearing, Plaintiffs counsel stated that Equitas has
begun producing documents in the Massachusetts action, Plaintiff now has access to the documents
in the Equitas email account, and the Massachusetts court entered an order compelling production
of ESL Defense counsel agreed that there is little need for the court to address the issue here when
Equitas is producing the documents in the Massachusetts action and is subject to a subpoena in
this case. The parties appear to agree that the court need not presently decide whether French has
possession, custody, or control of his Equitas email accol!nt. Accordingly, the issue is moot.

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3. French's production is not limited to documents regarding projects begun
prior to July 25, 2017.
French contends that the non-compete, non-solicitation, and non-disclosure provisions of
his employment contract with inVentiv were limited to the period of tim~ extending twelve months
after the end of his employment. Def. 's Resp. [DE-35] at 6. Frerich reasons that because his
employment ended on July 25, 2016, the scope of production does not extend beyond July 25,
2017. Id. Plaintiff contends that the non-solicitation period e4tends for eighteen months following
the end of French's employment, French's confidentiality obligations do not expire, there is a
tolling provision in the contract, and some of Plaintiff·s claims do not depend upon the contract;
-therefore, the July25, 2017 cut-off date is baseless. Pl.'s Mem. [DE-34] at 6-7.
According to the employment agreement attached to. the complaint, there is no time limit
on the confidentiality and non.a.disclosure provisions. [DE-1-1] at 2. The non-competition period
ends twelve months following termination, but it does not run during any time period in which the
employee is not in compliance with the agreement. Id. at 3. The non-solicitation period ends
eighteen months following termination and also contains a tolling provision. Id.
Plaintiff has persuasively offered four reasons why the July 25, 2017 cut-off date for
production should not shape the scope of the discovery requests given th~ complaint allegations:
(1) the confidentiality and non-disclosure provisions are not limited in time, (2) the non-solicitation
period extends eighteen months following termination, (3) the non-competition and nonsolicitation periods are tolled during any period of noncompliance, and (4) some of Plaintiffs
claims are not based on the employment contract at all. It is French's burden to show why
discovery should be denied for projects begun after July 25, 2017, and.he has not met his burden
here. See Mainstreet Collection, 270 F.R.D. at 240. There is no reason to limit discovery to
projects begun prior to July 25, 2017 when many of Plaintiffs claims may be_ based, at least in

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part, on projects begun_ after that date.

Accordingly, French's production is not· limited to
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· documents regarding projects begun prior to July 25, 2017.
4. The Disputed Requests

Plaintiffs first motion to compel identifies Requests 3, 7-10, 15, 31, 33, 35-41, 43-44,
'
54-57, 60, 70-72, 77, 78, 83-85, 100-104, 107~123, 126, and 129 as deficient. Pl.'s Mot. [DE33] at 1. However, only Requests 31, 54, 55, 77, 78, 85, 100-04, 107-20 are discussed in the
parties' briefs and actually appear to be in dispute. Pl.'s Mem. [DE-34] at 7-11; Def.'s Resp. [DE35] at 7-11. Additionally, Plaintiffs motion to compel ESI discusses Requests 77 and 78. [DE52] at 3-10.
Requests 31, 101, and 102

These requests seek documents identifying the employees and members of Equitas. [DE33-1] at 16-17, 51-52. French objected on the grounds that those requests are vague, overbroad,
unduly burdensome, and irrelevant.

Id.

Plaintiff contends that the identities of Equitas's

employees and members are relevant to its claims because it alleges that its own former employees
performed work for Equitas and that French solicited Plaintiffs employees to work for Equitas in
violation of the non-solicitation provision in the employment agreement. Pl.'s Mem. [DE-34] at
8. French responds that the identities of Equitas employees who were not formerly inVentiv
·employees are irrelevant. Def.'s Resp. [DE-35] at 7.
The basis of several of Plaintiffs claims is its allegation that its own employees defected
to Equitas in violation of their employment contracts; accordingly, the identities of any formerinVentiv employees who work or have worked for Equitas is plainly relevant. However, as French
notes,-the identities of any Equitas employees who were never inVentiv employees are likely not
televant to Plaintiffs claims.

Accordingly, French is ordered to produce non-privileged ;

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documents that are responsive to Requests 31, 101, and 102, limited to those employees or
members of Equitas who were once employed by inVentiv, and in French's possession, custody,
or control.

Request 55
This request seeks material "sufficient to identify ... the family medical issues that were
purportedly causing [French] stress" when he requested a leave of absence from inVentiv. [DE33-1] at 28. Plaintiff contends that the documents are relevant because Plaintiff intends to show
that French's family's medical issues were a pretext for his leave of absence, and in fact he worked
for Equitas during that time. Pl.'s Mem. [DE-34] at 8. French responds that he has already
informed Plaintiffs counsel that his family member has a serious and advanced condition of
multiple sclerosis and that Plaintiff is not entitled to medical documents or records from a nonparty. Def.'s Mem. [DE-35] at 7-8.
Documents regarding the medical issue appear relevant to Plaintiffs claims, and French
does not contest that the documents are relevant. Instead, he responds that-no case law supports'
Plaintiffs claim to medical records of a third party.

Documents responsive to this request,

however, would appear to include those other than medical records from a non-party. As the party
· resisting discovery, it is French's burden to ,5how why discovery should be denied< and his response
is inadequate. Documents sufficient to identify French's family member's medical issues appear
relev~t, and French has not argued that they are privileged or disproportional to the needs of the
case. See Fed. R. Civ. P. 26(b)(l) (allowing discovery on nonprivileged, relevant matters that are
proportional to the needs of the case). Accordingly, French is ordered to produce responsive
documents to Request 55.

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Request 85

This request seeks telephone records that may concern any of the facts or circumstances
raised by the pleadings. [DE-33-1] at 41. Plaintiff contends that the phone records are relevant
because French allegedly used his personal phone to communicate with former· inVentiv
employees and others about Equitas. Pl.'s Mem. [DE-34] at 9. French contends that the request
is vague, overbroad, and unduly burdensome because it is not limited for privilege, it is not limited
to relevant parties, and the existence of communications alone would not establish wrongdoing.
Def.'s Resp. [DE-35] at 8. French analogizes this case to D'Addario v. Geller, where the Fourth
Circuit held that the district court did not abuse its discretion in denying a motion to compel the
defendants to produce telephone records. 129 F. App'x 1, 6 (4th Cir. 2005).· The district court's
reasoning in D 'Addario was that the request was overbroad c!Ild the records would be insufficient
by themselves to establish the claim. Id
However, the Fourth Circuit in D 'Addario held only that the district court did not abuse its
discretion, and courts have "'substantial discretion' to grant or deny motions to compel discovery."
English, 2014 WL 555661, at *4 (quoting Lone Star, 43 F.3d at 929). Here, the request is not

overbroad because it is tailore,d to phone records that concerp. the facts and circumstances raised
by the pleadings. Additionally, the fact that the phone records do not, on their own, establish
wrongdoing does not make them undiscoverable; instead, the standard for discovery is "any
nonprivileged matter that is relevant to any party's claim or defense and prop<:>rtional to the needs
of the case." Fed. R. Civ. P. 26(b)(l). Whether the phone records are relevant-not whether they
are independently suffictent to establish a claim-is the question, and "relevance is broadly
· construed 'to encompass any matter that bears on, or that reasonably could lead to other matter
that could bear on, any issue that is or may be in the case."' Mainstreet Collection, 270 F.R.D. at

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240 (quoting Oppenheimer Fund, 437 U.S. at 351). The record of phone calls and text messages
· may at least reasonably lead to other matter that could bear on an issue in the case; for instance,
Plaintiff may choose to. question French during a deposition about the timing, frequency, and
subject matter of his calls to the other Defendants. Given the allegations that French surreptitiously
conspired with others to leave inVentiv and start a competing business, ·a record of French's
communications is relevant, and because the request is confined to records that may concern the
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facts and circumstances raised by the pleadings, it does not appear to be overbroad. French is
therefore ordered to produce non-privileged responsive documents to Request 85.
Request 100
This request seeks marketing materials delivered to prospective customers of Equitas.
[DE-33-1]. French contends that the request should be limited to marketing materials delivered to
companies that have some prior relationship with inVentiv. Def.'s Resp. [DE-35] at 9. Plaintiff
contends that all marketing materials would reveal the extent to which Equitas unlawfully
competed with inVentiv. Pl.'s Mem. [DE-34] at 9.
Because the employment agreement appears to prohibit solicitation of and the provision of
services to any client or "actively targeted prospect" of inVentiv, Request 100 may be reasonably
limited to marketing ·materials delivered to present or past clients or actively targeted prospects of
inVentiv. A request for all marketing materials is overbroad because the sending of materials to
non-clients or actively targeted prospects of inVentiv would not appear to violate the nonsolicitation provision of the employment contracts, thus the materials would not be relevant to
inVentiv' s claims. Accordingly, French is ordered to produce non-privileged documents regarding
marketing materials delivered to prospective customers of Equitas, limited to those entities who

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are or were clients or actively targeted prospects of inVentiv, to the extent such documents are
French's possession, custody, or control.

Request 104
This request seeks French's federal tax returns for each year from 2015 to the present. [DE33-1] at 53. French objects on the grounds that the information sought is "personal and sensitive"
and irrelevant to the claims and defenses in this matter. Id

"Federal case law recognizes a

qualified privilege limiting the disclosure of tax returns." SMD Software, Inc. v. EMove, Inc., No.
5:08-CV-403-FL, 2010 WL 2232261, at *2 (E.D.N.C. June 2, 2010) (citing Interstate Narrow

Fabrics, Inc. v. Century USA, Inc.; No. l:02-CV-146, 2004 WL 444570, at *2 (M.D.N.C. Feb. 24,
2004)). "Under this standard, tax returns are discoverable if they are relevant and the information
is not available from other sources." Id (citing Interstate Narrow Fabrics, Inc., 2004 WL 444570,
at *2). "The requesting party bears the burden of showing relevance and the resisting party the
burden of showing availability from other sources." Id (citing Interstate Narrow Fabrics, Inc.,
2004 WL 444570, at *2). Plaintiff contends that the tax returns are relevant because they would
show when French began earning income from Equitas and his annual compensation, which would
inform inVentiv's calculation of damages. Pl.'s Mem. [DE-34] at 9. French contends the tax
returns are irrelevant because they do not show the date French began working for Equitas, and
Equitas's profits, not French's personal income, would potentially be relevant to a calculation of
inVentiv's damages.

Def.'s Resp. [DE-35] at 10.

Additionally, French contends that the

information regarding his start date is available from other sources because Plaintiff may question
French about it during a deposition or request corporate documents in Equitas's custody. Id
For breach of a non-compete or similar agreement, the plaintiff is entitled to damages
"sufficient to give it the benefit of its bargain, i.e., to put it in the place it would liave been had the

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[defendants] not breached." W Insulation, LP v. Moore, 242 F. App'x 112, 119 (4th Cir. 2007);
Clark Material Handling Co. v. Toyota Material Handling US.A., Inc., No. 3:12-CV-510-MOC,
2015 WL 3514339, at *1 (W.D.N.C. June 4, 2015) (discussing damages for unfair competition,
unfair and deceptive trade practices, tortious interference with a contract, and tortious interference
with a prospective economic advantage, all in violation of North Carolina law); Keith v. Day, 81
N.C. App. 185,195,343 S.E.2d-562, 568 (1986) (discussing damages for breach of a covenant not
to compete). When employees of a plaintiff breach a non-compete agreement by going to work
for a competitor, the plaintiff must show that it suffered damages beyond what it would have lost
had the employees "elected to withdraw from the labor market altogether," most helpfully by
showing "identifiable or specific lost contracts" to the competitor. Hunter Grp., Inc. v. Smith, 9
F. App'x 215, 220 (4th Cir. 2001) (applying Georgia law} (citation omitted); see also Moses H
Cone Mem 'l Health Servs. Corp. v. Triplett, 167 N.C. App. 267,275,605 S.E.2d 492,497 (2004)
(applying North Carolina law and discussing lost profits). Here, it is not clear how French's
personal income is relevant to a calculation of inVentiv's damages. Equitas's revenue from
specific clients and contracts would presumably be relevant, but French's personal income would
not show what inVentiv's revenue would have been had French not allegedly breached the
contract. Additionally, the tax returns would likely only show the year, not the specific date, on
which French began earning income from Equitas. Accordingly, the requested tax returns do not
appear to be relevant.
Even if the tax returns were relevant, the information Plaintiff seeks from the returns
appears to be available from other sources. Plaintiff may question French in a deposition regarding
his Equitas start date, and it may subpoena information from Equitas regarding its revenue from
specific contracts as well as French's compensation, if desired, in order to show its damages.

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Because the tax returns are likely not relevant and, even if they were, the information is available
from other sources, French is not ordered to produce his tax returns. See SMD Software, 2010 WL
2232261, at *2.

Requests 107-115 and 118-20
These requests seek Equitas's check registers, deposit slips, invoices, copies of checks, and
receipts of payment relating to services rendered, as well as documents concerning loans made to
Equitas, investments made in Equitas, fees charged by Equitas for its services, Equitas's gross
revenu~, net profits, profit and loss statements, financial statements, business plans, payroll
records, and accounting books and records. [DE-33-1] at 54-61. According,to French, in the
Massachusetts action, the court has ordered Equitas to produce certain financial information,
including payment and profit information regarding Clients A and B. [DE-36-5]. Moreover,
French contends that he does not have possession, custody, or control of documents responsive to
Requests 107-115 and 118-20; the Massachusetts court's order would likely resolve the dispute;
and, if it did not, the parties should reconvene and further discuss the issue. Def. 's Resp. [DE-35]
at 10. Plaintiff asserts that the Requests seek relevant information. Pl. 's Mem. [DE-34] at 10. It
does not appear that French contests relevancy, and as the party resisting discovery, it is French's
burden to show why discovery should be denied; accordingly, French is ordered to produce any
non-privileged responsive documents to Requests 107-115 and 118-20 to the extent that they are
within his possession, custody, or control.

Requests 54, 55, 77, 78,103,104, and 107-20
These requests seek information regarding French's family ,member's_ medical issues;
demand that French produce computers and removable media for inspection; and seek Equitas's
tax,returns, French's tax returns, and Equitas's financial and business information. [DE-33-1] at

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27-28, 37-38, 52--62. Plaintiff asserts that any objection to those r~quests on the grounds that
they seek personal or confidential information is baseless because the protective order entered in
this case governs the production of confidential information. Pl.'s Mem. [DE-34] at 11-12.
,_

French responds that the issue is not confidentiality but rather that those requests seek documents
that belong to a non-party, are irrelevant, or are not in French's possession, custody, or control.
Def.'s Resp. [DE-35] at 11. The relevancy of French's family member's medical issues, French's
tax returns, and Eq~itas's financial information is discussed ~hove. The request

for French to

produce his computers and removable media for inspection is discussed below in light of Plaintiffs
motion to compel ESL [DE-52]. Accordingly, the parties' issues regarding Requests 54, 55, 77,
78, 103, 104, and 107-20 are discussed elsewhere, and there does not appear to be a remaining
dispute regarding confidentiality.

5.. Production of ESI
Requests 77 and 78 require Defendants to produce their own computers and removable
media for inspection by a forensics computer expert pursuant to a mutually-agreeable protocol.
[DE-33-1] at 37-38. Defendants objected on the grounds that the requests seek highly personal
and sensitive information that is irrelevant. Id The parties conferred in August and September
2019, and Plaintiff proposed a draft ESI pro~ocol. Pl.'s Mem. [DE-53] at 5. The parties discussed
the protocol on October 2, 2019 but were unable to resolve their differences. Id Plaintiffs
proposed protocol provides that Plaintiff will pay the cost of the forensic analyses; Plaintiffs
counsel and Defendants' counsel will work in good faith to reach agreed-upon search terms and
parameters; and Defendants' counsel will review the results of the analysis first and will have ten
business days to object to the production of documents based on_privilege, confidentiality, privacy,
or irrelevancy. [DE-53-1]. The protocol further provides that if the parties cannot reach an

16

agreement regarding Defendants' objections to production of certain documents, then the disputed
material may be tendered to the court for in-camera review. Id Plaintiff contends that the protocol
adequately addresses Defendants' objections because it allows counsel to agree upon search terms
that will return relevant documents, Plaintiff will bear the cost of the analysis, and Defendants'
counsel will review the documents first and may object to the disclosure of privileged or
confidential information. Pl.'s Mem. [DE-53] at 10. Defendants contend that the requests are
overbroad, seek sensitive personal information that is irrelevant, are disproportionate to the issues
of the case because the information may be obtained through less intrusive means, are cumulative
and unnecessary, and amount to a fishing expedition based on pure speculation. Def.' s Resp. [DE54] at 4-10.
Discovery is permitted on "any nonprivileged matter that is relevant to any party's claim
or defense and proportional to the needs of the case," but a party need not produce ESI that is "not
reasonably accessible because of undue burden or cost."

Fed. R. Civ. P. 26(b)(l), (2)(B).

Defendants do not appear to contend that the ESI is not readily accessible; rather, Defendants argue
that the requests are overbroad and seek irrelevant information. Plaintiffs contend that Defendants'
devices likely contain communications between the Defendants regarding Equitas and their
defectioff from inVentiv, communications with inVentiv' s clients, and confidential information
taken from inVentiv. Pl.'s Mem. [DE-53] at 7-8. Plaintiff alleges that in September 2015, French
asked the other Defendants for their personal email addresses, and Defendants exchanged emails
and text messages with each other on their personal devices. Id Plaintiff further contends that
because Defendants defected from inVentiv covertly, it is likely they used their personal devices,
rather than their inVentiv devices, to perform work on behalf of Equitas while they were still
employed by inVentiv. Id.

17

Relevancy is broadly construed, Mainstreet Collection, 270 F.R.D. at 240, and Plaintiff has
shown that the requests seek relevant information. As for Defendants' concerns regarding the
overbreadth and proportionality of the inspection, Plaintiffs protocol requires the parties to confer
)

in good faith and agree upon search terms and parameters before the search is conducted. [DE53-1] at 2. A narrowing of search terms prior to the search should address Defendants' relevancy
and overbreadth concerns. See Rosinbaum v. Flowers Foods, Inc., 238 F .. Supp. 3d 738, 750
(E.D.N.C. 2017) (holding that "the court lacks sufficient information to address these issues of
duplication and proportionality," but "plaintiffs indicate their willingness to narrow the search
terms," and directing the parties to confer and agree upon acceptable search terms); Baclawski v.

Mountain Real Estate Capital LLC, No. 3:15-CV-417-RJC-DCK, 2016 WL 3381258, at *3
(W.D.N.C. June 10, 2016) ("Although the undersigned is not convinced Plaintiff should be
compelled to allow Defendant to completely image her phones and computers, Defendant should
be able to obtain specific information from Plaintiffs devices that is helpful to the case."). The
proposed protocol provides that Defendants will review the produced material first, and if
Defendants believe that privileged, confidential, or irrelevant material is produced, they may object
before the material is produced to inVentiv. [DE-53-1] at 2-3. If the parties cannot resolve the
objections, they will be subject to court review. Id. at 3. The proposed protocol appears to have
sufficient safeguards to address Defendants' relevancy and proportionality concerns and provides
recourse if additional issues arise. See Rosinbaum, 238 F. Supp. 3d at 750. Defendants raise no
issues opposing the proposed protocol. Accordingly, Plaintiffs motion to compel ESI is allowed,
and the court adopts Plaintiffs proposed protocol for examination of Defendants' devices. [DE53-1].

18

B. Defendants' Motions to Seal
French seeks to maintain under seal Exhibit D to the Declaration of Melanie Dubis, [DE37], filed in support of his response in opposition to Plaintiffs motion to compel. Additionally,
Defendants seek to maintain under seal Exhibits A and B to their memorandum in opposition to
Plaintiffs motion to modify the discovery plan as well as Exhibits 1 and 2 to their memoran~um
in opposition to Plaintiffs motion to compel ESL

[DE-46, -47, -55, -56]. Plaintiff has not

responded to the motions to seal, and the time for doing so has expired.
"[T]he courts of this country recognize a general right to inspect and copy public records
and documents, including judicial records and documents." Nixon v. Warner Commc 'ns, Inc., 435
U.S. 589,597 (1978). The Fourth Circuit has directed that before sealing publicly filed documents
the court must first determine if the source of the public's right to access the documents is derived
from the common law or the First Amendment. Stone v. Univ. ofMd, 855 F .2d 178, 180 (4th Cir.
1988). The fact that the documents sought to be sealed are subject to a protective· order by the
court does not relieve the parties or the court from the obligation to comply with the Fourth
Circuit's sealing regimen. See Hall v. United Air Lines, Inc., 296 F. Supp. 2d 652, 679-80
(E.D.N.C. 2003); Volum~trics Med Imaging, LLC v. Toshiba Am. Med Sys., No.l:05-CV-955,
2011 WL 2413404, at *5 (M.D.N.C. Jun. 10, 2011) (citations omitted). "[T]he common law
presumption in favor of access attaches to all 'judicial records and documents,' [while] the First
Amendment guarantee of access has been extended only to particular judicial records and
documents[,]" such as those filed in connection with a motion for summary judgment. Stone, 855
F.2d at 180 (quoting Nixon, 435 U.S. at 597 & citing Rushford v. New Yorker Magazine, Inc., 846
F.2d 249, 253 (4th Cir. 1988)). Here, the documents sought to be sealed have been filed by
Defendants in connection with their opposition to Plaintiffs motions to compel and motion to

19

modify the discovery plan, and thus the documents play a role in t~e adjudication process. See In

re Application of the United States for an Order Pursuant to 18 USC. Section 2703(D), 707 F.3d
283, 290 (4th Cir. 2013) ("[D]ocuments filed with the court are 'judicial records' if they play a
role in the adjudicative process, or adjudicate substantive rights.") (citations omitted); United

States v. Amodeo, 44 F.3d 141, 145 (2d Cir. 1995) ("[T]he item filed must be relevant to the
performance of the judicial function and useful in the judicial process in order for it to be
designated a judicial document."). Furthermore, the documents at issue are not subject to the First
Amendment right of access because they are related to a dispute over the scope of discovery and
a dispute over case management deadlines. See 360 Mortg. Grp., LLC v. Stonegate Mortg. Corp.,
No. 5:14-CV-310-F, 2016 WL 3030166, at *7 n.6 (E.D.N.C. May"- 25, 2016) (applying the
"experience and logic" test, which considers whether the proceeding benefits from public access,
in determining when the First Amendment right to access applies); Covington v. Semones, No.
7:06-CV-00614, 2007 WL 1170644, at *2 (W.D. Va. Apr. 17, 2007) ("In this instance, as the
exhibits at issue were filed in connection with a non-dispositive motion, it is clear there is no First
Amendment-right of access.").
The presumption of access under the common law is not absolute, and its scope is a matter
left to the discretion of the district court. Va. Dep't ofState Police v. Washington Post, 386 F.3d
567, 575 (4th Cir. 2004), cert. denied, 544 U.S. 949 (2005). The presumption "'can be rebutted if
countervailing interests heavily outweigh the public interests in access,' and ' [t ]he party seeking
to overcome the presumption bears the burden of showing some significant interest that outweighs
the presumption."' Id. (quoting Rushford, 846 F.2d at 253). "Some of the factors to be weighed in
the common law balancing test 'include whether the records are sought for improper purposes,
such as promoting public scandals or unfairly gaining a business advantage; whether release would

20

enhance the public's understanding of an important historical event; and whether the public has
already ha~ access to the information contained in the records."' Id (quoting In re Knight Pub[.

Co., 743 F.2d-231, 235 (4th Cir. 1984)). Finally, prior to sealing a judicial record the court must
(1) give the public notice of the request to seal and a reasonable opportunity to challenge it; (2)

consider less drastic alternatives' to sealing; ari.d (3) "state the reasons for its decision to seal
supported by specific findings, and the reasons for rejecting alternatives to sealing in order to
provide an adequate record for review." In re Knight Pub. Co., 743 F.2d at 235 (citation omitted).
Here, the documents consist of materials considered confidential by the filing parties,
subject to a protective order of the court. Although not dispositive, this factor does speak to the
purported nature of tpe documents, which contain sensitive business information not available to
the general public, including the identities of Clients A and B. Based on this showing, the court
finds that the presumption of access has been overcome.
In addition, the public must be given noti~e of a request to seal and a reasonable opportunity
to challenge it. In re Knight Publishing Co., 743 F.2d at 235. Here, Defendants' motions were
filed on October 15, November 21, and December 11, 2019. No opposition to the motions have
been filed by any party or non-party despite a reasonable opportunity to do so.
Finally, the court is obligated to consider less drastic alternatives to sealing, and where a
court decides to seal documents, it must "state the reasons for its decision to seal supported by
specific findings, and the reasons for rejecting alternatives to sealing in order to provide an
adequate record for review." Id

Because, as described, the documents in questio~ contain

confidential information and are not generally available to the public, the court finds that
alternatives to sealing do not exist at the present time.

21

Accordingly, Defendants' motions to seal [DE-38, -48, -57] are ALLOWED and the
following documents shall remain under seal in accordance with Local Civil Rule 79.2: Exhibit D
to the Declaration of Melanie Black Dubis, [DE-37]; Exhibits A and B to Defendants' response in
opposition to Plaintiffs motion for an extension of time to complete discovery, [DE-46, -47]; and
Exhibits 1 and 2 to Defendant's memorandum in opposition to Plaintiffs motion to compel ESI,
[DE-55, -56].

C. Plaintiff's Motion for an Extension of Time
Plaintiff requests that the court extend the deadline for fact discovery from December 15,
2019 to June 15, 2020 and adjust all other deadlines accordingly. [DE-42]. Under Federal Rule
of Civil Procedure 16(b)(4), a scheduling order "may be modified only for good cause and with
the judge's consent." The good cause standard of Rule 16(b)(4) focuses on the moving party's
diligence, rather than prejudice to the non-movant or bad faith. Halpern v. Wake Forest Univ.

Health Scis., 268 F.R.D. 264,274 (M.D.N.C. 2010) (citation omitted).
Plaintiff contends there is good cause to modify the scheduling order because this case is a
complex, multi-jurisdictional matter. [DE-43] at 1. Plaintiff intends to take more than a dozen
additional depositions, it has already produced more than 865,000 pages in discovery, and a
defendant produced documents as recently as November 5, 2019. Id. at 2. Plaintiff alleges that
Defendants' document production has been halting and minimal and that Defendants have
deployed a "run-out-the-clock" strategy in conducting discovery.

Id. at 6, 9.

Plaintiff

acknowledges that a six month extension is substantial, but it states that it has moved to extend the
discovery deadline in the New Jersey and Massachu~etts actions and that this request will be its
last motion for an extension of the fact discovery deadline. Id. at 1-2, 8.

22

Defendants respond that they do not oppose an extension of the discovery deadline to
January 31, 2020, but a six-month extension is unnecessary. [DE-45] at 2. Defendants contend
that Plaintiff has over-litigated the, case by splintering it into three separate actions, serving
overbroad and cumulative discovery-- requests, producing hundreds of thousands of irrelevant
documents, inefficiently conducting depositions, producing illegible documents, and concealing
which confidential information and trade secrets are at issue. [DE-45] at 2-6.
\

In summary, Plaintiff accuses-Defendants of hindering the discovery process, and
Defendants accuse Plaintiff of over-complicating it. Nonetheless, whether either party has thus
far acted in bad faith is not at issue in determining whether good cause exists for this extension of
time, as Plaintiff requested the extension before the deadline of December 15, 2019 passed._
.

I

Plaintiff acknowledges that six months is a lengthy extension, and because more than one year has
already passed since the court's October 20, 2018 scheduling order, [DE-22], the court agrees that
an additional _six months would be a lengthy extension. Plaintiff has shown good cause for some
extension of the discovery deadline, and Defendants have-consented to an-extension mirroring the
Massachusetts and New Jersey scheduling orders. [DE-61]. Accordingly, the court will extend
the case management deadlines as follows:
1. All fact discovery shall be completed by April 16, 2020;
2. Reports from retained experts are due by May 15, 2020;
3. Reports from rebuttal experts are due June 15, 2020; and
4. All potentially dispositive motions shall be filed by July 15, 2020.
IV. CONCLUSION

For the foregoing reasons, Plaintiff,s motion to compel [DE-35] is ALLOWED in part and
DENIED in part; Plaintiffs motion to compel ESI [DE-52] is AI;,LOWED; Defendants' motions

23

to seal [DE-38, -48, -57] are ALLOWED; and Plaintiffs motion for an extension of time to
complete discovery [DE-42] is ALLOWED.
So ordered, the 12th day of February 2020.

t,1-1-~

I

Robert B. Jones, Jr.
United States Magistrate Judge

24