Edward D. Ioli Trust et al v. Avigilon Corporation et al
Filing
279
MEMORANDUM OPINION and ORDER - Granting # 263 Motion to compel as set forth herein. Motions terminated: 263 SEALED MOTION Plaintiffs Edward D. Ioli Trust and General Traffic Controls, Inc.s Emergency Motion to Compel Source Code and Document Production filed by General Traffic Controls, Inc., Edward D. Ioli Trust.. Signed by Judge Rodney Gilstrap on 11/16/12. (ehs, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION
EDWARD D. IOLI TRUST and GENERAL
TRAFFIC CONTROLS, INC.,
Plaintiffs,
v.
AVIGILON CORPORATION, et al.,
Defendants.
§
§
§
§ CIVIL ACTION NO. 2:10-cv-605-JRG
§
§
§
§
MEMORANDUM OPINION AND ORDER
Before the Court is Plaintiffs Edward D. Ioli Trust and General Traffic Controls, Inc.
(collectively “Plaintiffs”) Emergency Motion to Compel Source Code and Document Production,
filed October 25, 2012 (Dkt. No. 263) (“Motion”). The Court having considered same finds that
the Motion should be GRANTED for the reasons set forth below.
I.
Factual and Procedural Background
On December 30, 2010, Plaintiffs filed suit against Defendants Image Sensing Systems,
Inc., CitySync Technologies, Inc., Coban Technologies, Inc., Vigilant Video, Inc. and Elsag North
America, LLC, alleging infringement of U.S. Patents Nos. 7,382,277 and 7,791,501.
Per
mediation held on August 29, 2012, Plaintiffs settled with all defendants except Vigilant Video,
Inc. (“Vigilant”). Plaintiffs then served Vigilant with their First Set of Document Requests on
September 4, 2012. Plaintiffs assert that up until September 4, 2012 Vigilant had produced 362
pages of documents, which did not include any source code pursuant to P. R. 3-4(a). (Dkt. No.
263 at 3.)
Vigilant does not dispute this point—or that the deadline for complying with
P. R. 3-4(a) was February 2, 2012—in its response or sur-reply to the Motion. (See Dkt. Nos. 271
and 275.) Plaintiffs subsequently initiated a series of communications with Vigilant, beginning
September 6, 2012, related to Plaintiffs’ First Set of Document Requests and Vigilant’s disclosure
1
obligations pursuant to P. R. 3-4(a). On October 25, 2012, Plaintiffs filed the present Motion
seeking an order compelling Vigilant “to produce source code as required by P. R. 3-4(a) and to
produce documents pursuant to Plaintiffs’ First Set of Requests for Production.” (See Dkt. No.
263 at 1.)
II.
Discussion
The rules of discovery are accorded a broad and liberal application to affect their purpose
of adequately informing litigants in civil trials. Herbert v. Lando, 441 U.S. 153, 176, 99 S.Ct.
1635, 60 L.Ed.2d 115 (1979). “A district court has broad discretion in all discovery matters . . . .”
Beattie v. Madison County Sch. Dist., 254 F.3d 595, 606 (5th Cir. 2001) (quoting Kelly v. Syria
Shell Petroleum Dev. B.V., 213 F.3d 841, 855 (5th Cir. 2000)); see also Alpine View Co. v. Atlas
Copco AB, 205 F.3d 208, 220 (5th Cir. 2000). The party requesting discovery may move to
compel the disclosure of any materials requested so long as such discovery is relevant and
otherwise discoverable. See Fed. R. Civ. P. 37; Export Worldwide, Ltd. v. Knight, 241 F.R.D.
259, 263 (W.D. Tex. 2006) (“Federal Rule of Civil Procedure 37(a)[(3)(B)(iii) and (iv)] empowers
the court to compel the production of documents . . . upon motion by the party seeking
discovery.”). The moving party bears the burden of showing that the materials and information
sought are “relevant to any party’s claim or defense” or “appear[] reasonably calculated to lead to
the discovery of admissible evidence.” See Fed. R. Civ. P. 26(b)(1); Knight, 241 F.R.D. at 263.
Once the moving party establishes that the materials requested are within the scope of permissible
discovery, the burden shifts to the party resisting discovery to demonstrate why the discovery is
irrelevant, overly broad, or unduly burdensome or oppressive. See, e.g., SSL Services, LLC v.
Citrix Systems, Inc., 2010 U.S. Dist. LEXIS 11470, 2010 WL 547478 at *2 (E.D. Tex. Feb. 10,
2010) (citing Spiegelberg Mfg., Inc. v. Hancock, 2007 U.S. Dist. LEXIS 88987, 2007 WL 4258246
2
at *1 (N.D. Tex. Dec. 3, 2007)).
Here, Plaintiffs move to compel production of (a) source code pursuant to P. R. 3-4(a) and
(b) documents in response to Plaintiffs’ First Set of Requests for Production.
a. Production of Source Code Pursuant to Patent Rule 3-4(a)
This dispute centers upon the scope of the production requirement imposed by P. R. 3-4(a).
P. R. 3-4(a) provides that, with service of the invalidity contentions, “the party opposing a claim of
patent infringement must produce or make available for inspection and copying:
(a) Source code, specifications, schematics, flow charts, artwork, formulas, or other
documentation sufficient to show the operation of any aspects or elements of an Accused
Instrumentality identified by the patent claimant in its P. R. 3-1(c) chart.”
Plaintiffs argue that the Court should compel Vigilant to comply with P. R. 3-4(a) and produce its
source code. Specifically, Plaintiffs contend that among the 21 “technical” documents produced
by Vigilant, only two describe the functionality of the accused software, and that those two
documents do not provide sufficient descriptions of the operation of any aspects or elements of the
accused software. In response, Vigilant argues that the plain text of P. R. 3-4(a) mentions “source
code” but does not require its production because the disjunctive “or” authorizes seven distinct
categories of documents by which Vigilant can meet P. R. 3-4(a). Thus, Vigilant contends, it is
not obligated to produce source code because the Plaintiffs have not explained why source code is
necessitated in addition to Vigilant’s production of other documents thus far. The Court rejects
Vigilant’s narrow reading of the local patent rules. Vigilant’s “grammatical” opposition to
producing its source code would, if accepted by the Court, likely close the door to the production
of source code in this and all future patent infringement cases.
The United States District Courts for the Northern District of California and Southern
District of California have addressed the scope of their respective Patent Local Rule 3.4(a), which
is nearly identical to this District’s P. R. 3-4(a) and was the source from which this District’s
3
P. R. 3-4(a) was originally crafted. See, e.g., NessCap Co., Ltd. v. Maxwell Technologies, Inc.,
2008 U.S. Dist. LEXIS 3357, 2008 WL 152147 (S.D. Cal. Jan. 16, 2008); IXYS Corp. v. Advanced
Power Tech., Inc., 2004 U.S. Dist. LEXIS 10934, 2004 WL 1368860 (N.D. Cal. June 16, 2004).
In NessCap, the Southern District held that its Patent Local Rule 3.4(a) requires “the alleged
infringer to produce ‘any and all documents describing the operation or structures of [the
patentee’s] accused devices. . . .’” See, e.g., NessCap Co., 2008 U.S. Dist. LEXIS 3357, 2008
WL 152147 at *8 (quoting IXYS Corp., 2004 U.S. Dist. LEXIS 10934, 2004 WL 1368860 at *3);
I-Flow Corp. v. Apex Medical Technologies, Inc., 250 F.R.D. 508, 511 (S.D. Cal. 2008) (agreeing
with the interpretation of Rule 3.4(a) in NessCap). The Court further explained that its Rule
3.4(a) requires “the responding party to provide the raw data (source code, schematics, formulas,
etc.) sufficient to show the operation of the accused aspects of the products in order to allow the
patentee to make it’s own determinations as to infringement.” NessCap Co., 2008 U.S. Dist.
LEXIS 3357, 2008 WL 152147 at *10 (citing McKesson Info. Solutions LLC v. Epic Sys. Corp.,
495 F. Supp. 2d 1329, 1334 (N.D. Ga. 2007) (emphasis in original)).
This Court agrees with its sister courts in California. This District’s P. R. 3-4(a) requires
the alleged infringer to produce any and all documents describing the operation of any aspects or
elements of an accused instrumentality. P. R. 3-4(a) clearly covers source code, regardless of
what additional materials may exist to disclose the functionality of the technology at issue.
Indeed, the local patent rules mitigate the “tension between the necessity for orderly and complete
discovery on the one hand, and the desire of litigants to attain important tactical advantages by
delaying or avoiding disclosures of key elements of their case” on the other hand. See Computer
Acceleration Corp. v. Microsoft Corp., 503 F. Supp. 2d 819, 821 (E.D. Tex. 2009). Such rules
“exist to further the goal of full, timely discovery and provide all parties with adequate notice and
4
information with which to litigate their cases, not to create supposed loopholes through which
parties may practice litigation by ambush.” Id. at 822 (quoting IXYS Corp., 2004 U.S. Dist.
LEXIS 10934, 2004 WL 1368860 at *3; citing STMicroelectronics, Inc. v. Motorola, Inc., 307 F.
Supp. 2d 845, 849 (E.D. Tex. 2004)); see also Herbert, 441 U.S. at 176 (stating that the rules of
discovery “are to be accorded a broad and liberal treatment to affect their purpose of adequately
informing litigants in civil trials”).
Importantly, the patent local rules “are not like other forms of discovery which require a
formal request by the opposing party. Rather, it is the responsibility of the party itself to make
disclosures that satisfy the Rules.” Cryptography Research, Inc. v. Visa Int’l Serv. Ass’n, 2005
U.S. Dist. LEXIS 37013, 2005 WL 1787421 at *3 (N.D. Cal. July 27, 2005). Vigilant’s bare
minimum production shirks this responsibility and its attempt to use a grammatically technical
reading of P. R. 3-4(a) as a shield to avoid production of its source code offends the discovery
principles driving this District’s patent rules. P. R. 3-4(a) requires Vigilant to produce more than
the bare minimum of what it believes is sufficient, including but not limited to any and all source
code, specifications, schematics, flow charts, artwork, formulas, or other documentation in its
possession.
In refusing to produce its source code, Vigilant frames Plaintiffs’ allegation of insufficient
production as a “bare assertion” that lacks explanation and “bears no declaration from counsel or
anyone else on this point.” (See Dkt. No. 271 at 5.) On the contrary, attached to Plaintiffs’
Motion is a declaration by Monica Tavakoli, counsel for Plaintiffs, who declares that among the 21
documents produced by Vigilant, “only two describe the functionality of the software” and that
those two documents “do not provide sufficient descriptions of the ‘operation of any aspects or
elements of an Accused Instrumentality identified by the patent claimant in its P. R. 3-1(c) chart’
5
as required by P. R. 3-4(a).” (See Dkt. No. 263, Ex. M at ¶ 7.) While Vigilant argues that
Plaintiffs have not detailed deficiencies in Vigilant’s production thus far, it is Vigilant that has the
burden to explain how its document production thus far satisfies P. R. 3-4(a). This it has clearly
failed to do. It is undisputed that Vigilant is obligated to produce all source code, specifications,
schematics, flow charts, artwork, formulas, or other documentation as required by P. R. 3-4(a) in
its possession. Such documents are relevant to the Plaintiffs’ claim of infringement and Vigilant
does not advance any argument why such obligation is irrelevant, overly broad, or unduly
burdensome or oppressive. Accordingly, the Court finds that Plaintiffs’ motion to compel
Vigilant to produce all source code, specifications, schematics, flow charts, artwork, formulas, or
other documentation as required by P. R. 3-4(a) in its possession, should be and is hereby
GRANTED.
b. Production of Documents in Response to Plaintiffs’ First Set of Requests for
Production
Plaintiffs move the Court to compel Vigilant to produce to Plaintiffs’ counsel all
non-privileged documents responsive to Plaintiffs’ document requests. In its Motion, Plaintiffs
specifically mapped each request for production to topics related to their patent infringement
claims against Vigilant.
The Court finds these topics relevant to the Plaintiffs’ claims of
infringement. That having occurred, the burden shifts to Vigilant to demonstrate why the
discovery is irrelevant, overly broad, or unduly burdensome or oppressive. Vigilant has failed to
meet this burden.
Vigilant indicated to Plaintiffs that it had collected several hundred thousand pages of
responsive documents, but has refused to produce any documents unless Plaintiffs agreed to pay
the production costs. Vigilant advances two reasons to justify its position. First, Vigilant asserts
that because nothing requires it to produce source code, an “offer to produce predicated upon a
6
recompensing payment scarcely arises to the level of rebellious behavior that Plaintiffs portray.”
(See Dkt. No. 271.) Second, Vigilant asserts that such production would be expensive as the cost
exceeds $10,000. While Vigilant, in its sur-reply, states that the “sticking point has been the
unwillingness of the plaintiffs to compensate Vigilant for the costs of producing such a large
amount of documents requested” (Dkt. No. 275 at 5), Vigilant also claims that it is not
“advanc[ing] a legal argument that the cost of production should be shifted to Plaintiffs.” (Id. at 4
(quotation omitted).) As a result, the Court finds that Vigilant essentially argues only that the
discovery at issue is unduly burdensome or oppressive.
This argument fails. Vigilant does not provide any evidence in support of its asserted cost
figure. Vigilant fails to consider the discovery cost against the needs of the case, the prior
discovery in the case, the amount in controversy, and the importance of the issues at stake.
Vigilant does not, in any manner, argue that the burden or expense outweighs the likely benefit of
the discovery. Vigilant simply makes the assertion that the discovery cost is expensive because it
exceeds $10,000. Such an isolated assertion does not meet the burden of showing why the
discovery is unduly burdensome or oppressive. Accordingly, the Court finds that Plaintiffs’
motion to compel Vigilant to produce all non-privileged documents in response to Plaintiffs’ First
Set of Requests for Product should be and is hereby GRANTED.
III.
Conclusion
Based on the foregoing, this Court reaffirms the principle of broad and liberal discovery
underlying P. R. 3-4(a). This Court rejects the notion that P. R. 3-4(a) provides an excuse to
withhold source code if some other material speaks to functionality. Rather, P. R. 3-4(a) imposes
an affirmative obligation on the accused infringer to produce source code and all other relevant
materials reasonably needed for the Plaintiff to understand for itself how the technology at issue
7
operates and functions. Vigilant has failed to meet the duty imposed on it by P. R. 3-4(a) and has
offered only a threadbare excuse that would, if accepted, vitiate the rule altogether. Vigilant is
ORDERED to produce its source code, in compliance with the Agreed Protective Order, and all
other materials necessitated by P. R. 3-4(a) within ten days of the date of this Order. Vigilant is
also ORDERED to produce and deliver, at its cost, all the materials requested by Plaintiffs under
their First Request for Production within ten days of the date of this Order. Pursuant to Federal
Rule of Civil Procedure 37(a)(5)(A), Vigilant is further ORDERED to reimburse Plaintiffs for
their costs and fees in bringing the matters contained in this Motion to the Court’s attention, up to
$10,000.
The Plaintiffs shall be GRANTED 45 days additional time from the date of this Order to
complete discovery. Plaintiffs also move the Court to order Vigilant to appear for its 30(b)(6)
deposition in the Dallas, Texas area to mitigate the prejudice caused by Vigilant’s discovery delay.
Plaintiffs’ request is GRANTED. Vigilant is ORDERED to promptly appear for its 30(b)(6)
deposition at any designated location within Dallas County or Tarrant County, Texas upon
.
reasonable notice by Plaintiffs.
As an additional insight into the Court’s conclusions set forth above, the Court is
convinced that Vigilant’s conduct is indefensible. The Court has not discussed herein other
actions of Vigilant in this case which if reviewed specifically would only confirm this opinion. If
Vigilant continues to pursue a similar approach in the future, it (and its counsel) should be
prepared to show cause why sanctions should not be imposed.
SIGNED this 19th day of December, 2011.
So ORDERED and SIGNED this 16th day of November, 2012.
8
____________________________________
RODNEY GILSTRAP
UNITED STATES DISTRICT JUDGE
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?