Audi of America, Inc. v. Bronsberg & Hughes Pontiac, Inc.

Filing 168

MEMORANDUM ORDER denying 136 MOTION to Quash Volkswagen Group of America, Inc.'s Third-Party Subpoenas filed by North American Automotive Services, Inc., Napleton Automotive of Urbana, LLC, Napleton Orlando Imports, LLC, Napleton Sanford Imports, LLC. Signed by Magistrate Judge Martin C. Carlson on May 17, 2017. (kjn)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
AUDI OF AMERICA, INC.,

:
:
Plaintiff
:
:
v.
:
:
BRONSBERG & HUGHES PONTIAC, :
INC. d/b/a WYOMING VALLEY
:
AUDI,
:
:
Defendant
:

Civil No. 3:16-CV-2470
(Judge Jones)
(Magistrate Judge Carlson)

MEMORANDUM ORDER
I.

Factual Background

On December 13, 2016, Audi of America, Inc., (“Audi”) brought a breach of
contract action, alleging that defendant Bronsberg & Hughes Pontiac, Inc., d/b/a
Wyoming Valley Audi (“Wyoming Valley”) breached certain terms of an Audi
Dealer Agreement into which the parties entered on January 1, 1997, when it
entered into an Asset and Real Estate Purchase Agreement (the “Purchase
Agreement”) with the Napleton Group. Audi alleged that this Purchase Agreement
between Wyoming Valley and the Napleton Group, which was signed on July 11,
2016, included the sale of Wyoming Valley’s Audi assets in violation of Audi’s
own right of first refusal and its right to refuse to consent to the transaction on

reasonable grounds. (Doc. 1.) In January of 2017, Audi sought, and obtained, a
preliminary injunction from the district court temporarily enjoining Wyoming
Valley and Napleton from consummating the Purchase Agreement while this
litigation was pending. (Doc. 30.) That order currently remains in effect, but is
now the subject of an array of competing motions filed by the parties.
These motions include a motion filed by Napleton to quash certain thirdparty subpoenas duces tecum issued by Audi to an array of non-party corporate
entities. (Doc. 136.) In this motion Napleton, which has now been granted leave
to intervene in this action, asserted that the third-party subpoenas were harassing
and went beyond the proper scope of civil discovery. Notably, while Napleton
lodged these objections, it does not appear that any of the subpoenaed third parties
have moved to quash these subpoenas.
Audi opposes this motion to quash third party subpoenas, arguing that
Napleton lacks standing to object to the subpoenas which are not directed to it.
(Doc. 156.) For the reasons set forth below, we agree and will deny this motion to
quash.
II.

Discussion

Several basic guiding principles inform our resolution of the instant motion
to quash.

At the outset, “[r]ule 45 of the Federal Rules of Civil Procedure

establishes the rules for discovery directed to individuals and entities that are not
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parties to the underlying lawsuit. Fed.R.Civ.P. 45.

A subpoena under Rule

45‘must fall within the scope of proper discovery under Fed.R.Civ.P. 26(b)(1).’
OMS Invs., Inc. v. Lebanon Seaboard Corp., No. 08–2681, 2008 WL 4952445, at
*2 (D.N.J. Nov. 18, 2008).” First Sealord Sur. v. Durkin & Devries Ins. Agency,
918 F. Supp. 2d 362, 382 (E.D. Pa. 2013). Rule 45 also confers broad enforcement
powers upon the court to ensure compliance with subpoenas, while avoiding unfair
prejudice to persons who are the subject of a subpoena’s commands. In this
regard, it is well settled that decisions on matters pertaining to subpoena
compliance rest in the sound discretion of the trial court and will not be disturbed
absent a showing of an abuse of that discretion. R.J. Reynolds Tobacco v. Philip
Morris Inc, 29 F. App’x 880, 881 (3d Cir. 2002). This far-reaching discretion
extends to decisions regarding whether to enforce compliance with subpoenas,
where “ ‘[i]t is well-established that the scope and conduct of discovery are within
the sound discretion of the trial court.’ Guinan v. A.I. duPont Hosp. for Children,
No. 08–228, 2008 WL 938874, at *1 (E.D.Pa. Apr.7, 2008) (quoting Marroquin–
Manriquez v. INS, 699 F.2d 129, 134 (3d Cir.1983)).” Coleman-Hill v. Governor
Mifflin School Dist,. 271 F.R.D. 549, 552 (E.D.Pa. 2010).
Considerations of standing also define our role in this field, particularly
when a party like Napleton seeks to quash a subpoena issued to some non-party

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witness who has not independently objected to that subpoena. In this factual
setting, we have been clear that:
Generally speaking, “a party does not have standing to quash a
subpoena served on a third party.” Castle v. Crouse, 2004 U.S. Dist.
LEXIS 9950, at *3 (E.D. Pa. May 25, 2004)(citing Thomas v. Marina
Assocs., 202 F.R.D. 433, 434 (E.D. Pa. 2001) (further citations
omitted). See also 9a Charles Alan Wright & Arthur R. Miller,
FEDERAL PRACTICE AND PROCEDURE: CIVIL § 2459 (2d ed.
1987). If, however, a party claims a property right or privilege in the
subpoenaed documents, then an exception to this general rule may
arise and provide that individual or entity with standing. See id. See
also Parker v. Learn the Skills Corp., 2004 U.S. Dist. LEXIS 21498
(E.D. Pa. Oct. 25, 2004).
Fiorentino v. Cabot Oil & Gas Corp., No. 3:09-CV-2284, 2012 WL 12861600, at
*4 n. 1 (M.D. Pa. Jan. 6, 2012). See e.g., Malibu Media, LLC v. Doe, No. 4:15CV-2281, 2016 WL 524248, at *1 (M.D. Pa. Feb. 10, 2016); Moyer v. Berdanier,
No. 3:CV-11-1811, 2013 WL 704483, at *3 (M.D. Pa. Feb. 26, 2013)..
In our view this settled principle controls here, and compels us to deny this
motion to quash. As a party-intervenor in this lawsuit, Napleton generally has no
standing to object to third-party subpoenas like those issued here by Audi. This
general rule admits of one limited exception where a party claims a property right
or privilege in the subpoenaed documents. However, Napleton has not alleged, or
shown, that this narrow exception to the general standing rules governing Rule 45
subpoenas has any application here. In the absence of such a showing, we will
deny this motion to quash.
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An appropriate order follows:
III.

Order

AND NOW, this 17th day of May, 2017, IT IS ORDERED that Napleton’s
Motion to Quash Third Party Subpoenas (Doc. 136.) is DENIED.

S/Martin C. Carlson
Martin C. Carlson
United States Magistrate Judge

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