GeoMetWatch v. Hall et al

Filing 399

ORDER denying 394 Motion to Compel. Please see order for details. Signed by Magistrate Judge Paul M. Warner on 12/19/2016. (srs)

IN THE UNITED STATES DISTRICT COURT DISTRICT OF UTAH
NORTHERN DIVISION
GEOMETWATCH CORPORATION, a
Nevada corporation,
Plaintiff,

MEMORANDUM DECISION AND
ORDER
Case No. 1:14-cv-60-JNP-PMW

vs.
District Judge Jill N. Parrish

ALAN HALL, et al.,
Defendants.

Magistrate Judge Paul M. Warner

District Judge Jill N. Parrish referred this case to Magistrate Judge Paul M. Warner
pursuant to 28 U.S.C. § 636(b)(1)(A). 1 Before the court is Utah State University Research
Foundation’s (“USURF”) motion to compel discovery related to a company called PILR, LLC
(“PILR”). 2 PILR was formed by an investor in GeoMetWatch (“GMW”) for the sole purpose of
investing in and funding this litigation. Other GMW Investors and their related companies are
also members of and/or investors in PILR.
USURF served subpoenas duces tecum on the following eight entities: PILR; Hinson
Development Corporation; S.L. Hinson Associates, LLLP; Kedge Capital, LLC; Sangha
Associates; Design and Production Incorporated; IntelSat Global Service Corporation; and
ArgoSat Consulting, LLC (collectively, “PILR Investors”). USURF seeks documents and
records regarding the formation and purpose of PILR; any agreements between and among PILR
Investors, GMW, and their counsel; and all written communications between and among PILR
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2

See docket no. 81 and 85.
See docket no. 394.

Investors and GMW, from January 2015 to the present. USURF asserts that the documents it
seeks are “relevant because they go to the motivation and credibility of witnesses in this case.” 3
Specifically, USURF contends that the GMW Investors originally blamed GMW’s management
for GMW’s failure but they have since testified that, upon additional knowledge of the facts,
USURF and the other defendants are to blame for GMW’s failure. USURF argues that it needs
the requested documents in order to impeach the GMW Investors’ credibility by asking them
about their financial stake in the outcome of the litigation. GMW and PILR Investors object to
the subpoenas on the grounds that the documents they seek are protected by the work-product
doctrine, the attorney-client privilege, and the common-interest privilege and seek irrelevant and
non-proportional information.
Under Rule 26(b)(1) of the Federal Rules of Civil Procedure, “[p]arties may obtain
discovery regarding any nonprivileged 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)(1). In determining whether the
requested discovery is proportional, courts consider “the importance of the issues at stake in the
action, the amount in controversy, the parties’ relative access to relevant information, the parties’
resources, the importance of the discovery in resolving the issues, and whether the burden or
expense of the proposed discovery outweighs its likely benefit.” Fed. R. Civ. P. 26(b)(1).
In this matter, while the requested discovery may be marginally relevant as PILR was
created to help fund the underlying case, the court concludes that requiring PILR Investors to
respond to the eight subpoenas would not be proportional to the needs of the case. The funding

3

Id. at 4.
2

agreements and communications between and among PILR Investors are of minimal importance
in resolving the underlying claims that the defendants misappropriated GMW’s trade secrets and
breached various other obligations. Furthermore, Defendants already possess documents that
allegedly support the GMW Investor’s previous frustrations with GMW’s management.
The Advisory Committee Notes for the 2000 Amendments to Rule 26 direct parties and
courts to “focus on the actual claims and defenses involved in the action” in determining
relevance for purposes of discovery. Fed. R. Civ. P. 26 Advisory Committee Notes, 2000
Amendments, Subdivision (b)(1). In addition, Rule 1, as amended on December 1, 2015, states
that the rules are to be “construed, administered, and employed by the court and the parties to
secure the just, speedy, and inexpensive determination of every action and proceeding.” Fed. R.
Civ. P. 1 (emphasis added). As stated in the 2015 Amendment to the Committee Notes,
Rule 1 is amended to emphasize that just as the court should construe and administer
these rules to secure the just, speedy, and inexpensive determination of every action, so
the parties share the responsibility to employ the rules in the same way. Most lawyers
and parties cooperate to achieve these ends. But discussions of ways to improve the
administration of civil justice regularly include pleas to discourage over-use, misuse, and
abuse of procedural tools that increase cost and result in delay. Effective advocacy is
consistent with—and indeed depends upon—cooperative and proportional use of
procedure.
Fed. R. Civ. P. 1, Advisory Committee Notes, 2015 Amendment.
In this case, all parties have been permitted to conduct a great deal of discovery already.
“Although the scope of discovery under the federal rules is broad, however, parties may not
engage in a ‘fishing expedition’ in an attempt to obtain evidence to support their claims or
defenses.” Richards v. Convergys Corp., No. 2:05–CV–00790–DAK, 2:05–CV–00812 DAK,
2007 WL 474012, *2 (Feb. 7, 2007 D. Utah) (quoting Munoz v. St. Mary–Corwin Hosp., 221
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F.3d 1160, 1169 (10th Cir. 2000). While the court appreciates USURF’s position, it will not
permit it to engage in a fishing expedition. The court encourages the parties to focus on the
specific claims and defenses in this matter for the “just, speedy, and inexpensive” resolution of
this case. Fed. R. Civ. P. 1.
Based on the foregoing, USURF’s motion to compel is DENIED. As a final note,
because the court has determined that the requested discovery is not relevant or proportional to
the needs of the case, it is unnecessary for the court to reach the issue of privilege as briefed by
the parties.
IT IS SO ORDERED.
DATED this 19th day of December, 2016.

BY THE COURT:

_________________________________
PAUL M. WARNER
United States Magistrate Judge

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