Cockburn v. SMS Industries, Inc. dba McGill Inc. et al

Filing 103

ORDER Granting in Part Pltf's 78 Motion to Compel and Award Sanctions by Judge Robert S. Lasnik; Deft is ORDERED to respond to Pltf's Request for Production within 21 days of the date of this Order. Also, Pltf is entitled to her reasonable expenses in bringing her motion. (TF)

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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

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SUSAN TIERNEY COCKBURN,

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v.

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Case No. C10-1566RSL

Plaintiff,
SWS INDUSTRIES, INC. dba MCGILL,
INC., et al.,

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Defendants.

ORDER GRANTING IN
PART PLAINTIFF’S
MOTION TO COMPEL AND
AWARD SANCTIONS

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This matter comes before the Court on Plaintiff’s “Motion to Compel and for

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Sanctions” (Dkt. # 78). Plaintiff alleges that Defendant McGill, Inc., has not yet

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complied with discovery requests propounded in September 2011. Worse, she contends

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that she has discovered that Defendant, and arguably its counsel, has willfully failed to
disclose relevant, responsive materials, agreeing to do so only after being “caught.”
Plaintiff asks for reimbursement of her fees and costs in bring this motion and requests
oral arguments on the matter. The Court GRANTS the motion IN PART.

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I. BACKGROUND1
This case concerns the alleged use of Plaintiff Tierney Cockburn’s copyrighted
“paper floral art” designs without her permission. Plaintiff is a Washington resident

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who designs and creates methods of making floral art out of paper. Her works are

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original and copyrightable.

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The Court assumes the parties are familiar with the facts and allegations undergirding
this case and repeats them here only as necessary.

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ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 1

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Defendant McGill, Inc., is a Illinois corporation that sells a line of “paper

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punches” under the brand names “Perfect Petals” and “Paper Blossoms.” Plaintiff

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alleges that specific punches infringe her original designs. She further alleges that the

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entirety of Defendant’s line so resembles her own products that it violates Washington’s

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trade dress infringement laws.
On September 27, 2011, Plaintiff served the discovery requests at issue on
Defendant. On November 15, 2011, Defendant responded, objecting to many of
Plaintiff’s requests as either irrelevant to the allegations of Plaintiff’s amended

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complaint or unduly burdensome. Dkt. # 78-3. Plaintiff disagreed with Defendant’s
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view. Within a week, she wrote to Defendant, explaining why she was entitled to each
of the items she requested. Dkt. # 78-4. The parties eventually conferenced and

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compromised on some of the requests, but otherwise did not resolve their dispute. Mot.

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(Dkt. # 78) at 4–5.

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The plot thickened in the ensuing months. Plaintiff alleges that she discovered

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through the deposition of numerous McGill witnesses that Defendant was in possession

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of many materials responsive to her requests, yet still undisclosed. Defendant admits as

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much, arguing that it is waiting for Plaintiff to give it a list of specific documents

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unearthed during these depositions. Opp. (Dkt. # 79) at 1–2. After failing to make any

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material headway at a subsequent “meet-and-confer” conference, Plaintiff filed the

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present motion, asking the Court to compel Defendant to disclose documents in response

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to her Requests for Production (“RFP”) Nos. 4, 10–14, 18, 24–28, 32, 38–70, 72, 78, 80,
84–98, and 100. Dkt. # 78.
II. DISCUSSION

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The discovery standard is a liberal one. Generally, “[p]arties may obtain
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discovery regarding any nonprivileged matter that is relevant to any party’s claim or
defense.” Fed. R. Civ. P. 26(b). “[I]nformation need not be admissible at the trial” to be

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ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 2

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considered relevant. Id. Rather, information is discoverable so long as it “appears

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reasonably calculated to lead to the discovery of admissible evidence.” Id.

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With this understanding in mind, the Court turns to Defendant’s rationale for
resisting the multiple categories of documents requested by Plaintiff. It then considers
whether Plaintiff is entitled to her “reasonable expenses incurred in making th[is]
motion, including attorney’s fees,” Fed. R. Civ. P. 37(a)(5)(A), and whether oral
arguments are necessary.
A. The Disputed Requests

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1. RFP Nos. 4, 18, and 32 — “Source Materials”
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Each of these requests pertains to Plaintiff’s request for the “source material” for
the design of specific products at issue in this suit. Dkt. # 78-3. Defendant contends

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that it misunderstood Plaintiff’s request, believing Plaintiff wished to know only the

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source for the raw materials used to produce the products. Opp. (Dkt. # 79) at 3. The

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Court finds that representation incredible. In her November 22 letter to Defendant,

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Plaintiff specifically stated that she sought documents relevant to “the source of the

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design for [each] product.” Dkt. # 78-4. It was plain what Plaintiff sought, and the

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Court ORDERS Defendant to comply with each of her requests. If it does not, the Court

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will impose sanctions, including, but not limited to, “prohibiting [Defendant] from

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supporting or opposing designated claims or defenses, or from introducing designated

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matters in evidence.” Fed. R. Civ. P. 37(b)(2)(A).

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2. RFP Nos. 10, 24, and 38 — Income Materials
Each of these requests pertains to Plaintiff’s request for documents, including
invoices, purchase orders, and/or collection letters, that demonstrate all income or

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revenue received from the sale of some of the specific McGill products at issue here.
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Dkt. # 78-3. Defendant argues that it provided Plaintiff with revenue figures, but that it

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ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 3

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would be unduly burdensome to provide the more detailed documents requested. Opp.

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(Dkt. # 79) at 3–4. The Court disagrees.

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Defendant’s unsupported objections fall woefully short of demonstrating that
“the burden or expense of the proposed discovery outweighs its likely benefit,
considering the needs of the case, the amount in controversy, the parties’ resources, the
importance of the issues at stake in the action, and the importance of the discovery in
resolving the issues.” Fed. R. Civ. P. 26(b)(2)(C). And, given the obvious concerns
raised by Defendant’s history of non-disclosure, the Court ORDERS Defendant to

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disclose all materials relevant to Plaintiff’s request.
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3. RFP Nos. 11, 25, 39, 53, and 67 — “Costs Associated” Materials
Each of these requests pertains to Plaintiff’s request for documents that reflect the

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“costs associated” with specific products. Dkt. # 78-3. Defendant argues that it

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provided Plaintiff with the requested documents—a total of 32 pages. Opp. (Dkt. # 79)

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at 4. Again, the Court finds reason to doubt that representation.

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Defendant responded to RFP Nos. 53 and 67 by objecting to disclosure on the

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grounds that the specific products at issue were not specifically named in Plaintiff’s

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amended complaint. Of course, that is not the standard for disclosure. Evidence must

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only be “reasonably calculated to lead to the discovery of admissible evidence” to be

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discoverable. Fed. R. Civ. P 26(b). Regardless, Plaintiff has stated a claim alleging that

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Defendant’s entire line, of which each of the disputed products is a part, “so resemble

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Tierney Cockburn’s products, with respect to trade dress, that ordinary consumers are
mistaking one for the other.” Amended Complaint (Dkt. # 16) at ¶ 107. As a result,
Plaintiff is plainly entitled to the evidence she seeks.

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Moreover, the Court notes that it expects that Defendant has both disclosed all
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relevant materials and that it has done so in a manner that allows Plaintiff to readily
identify those materials. If the Court determines that Defendant is selectively disclosing

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ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 4

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some documents and not others, or disclosing them in a manner intended to frustrate

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Plaintiff’s inquiry, it will impose substantial sanctions. Fed. R. Civ. P. 37(b)(2)(A).

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4. RFP Nos. 12, 13, 26, 27, 40, 72, 100 — Promotional Materials

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Plaintiff next requests that the Court order Defendant to fully respond to its

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requests for promotional materials relevant to specific products. Reply (Dkt. # 81) at 3.
It notes that while Defendant has disclosed some materials, cf. Opp. (Dkt. # 79) at 4–5,
many more have been uncovered only through third-parties, even though Defendant has
apparently had each in its possession. Reply (Dkt. # 81) at 3. For reasons already

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explained, the Court ORDERS Defendant to fully respond to Plaintiff’s requests.
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Again, if the Court determines that Defendant is selectively disclosing some documents
and not others, or disclosing them in a manner intended to frustrate Plaintiff’s inquiry,
the Court will not hesitate to impose substantial sanctions. Fed. R. Civ. P. 37(b)(2)(A).

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5. RFP Nos. 13, 27, 41, and 72 — “Sue Eldred” Materials

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Plaintiff’s contention in regard to each of these documents is its belief that

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Defendant is selectively disclosing only certain materials and not fully responding to her

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requests. Dkt. # 78-4. The Court ORDERS Defendant to fully comply with Plaintiff’s

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requests. As stated before, the Court will not hesitate to impose substantial sanctions

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should it find that Defendant is failing to do so. Fed. R. Civ. P. 37(b)(2)(A).

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6. RFP Nos. 14, 28, and 42

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Plaintiff complains that Defendant provided materials only in relation to

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individual customers and ignored its request for materials relevant to distributors and
resellers. Dkt. # 78-4. The Court ORDERS Defendant to supplement its response to
account for Plaintiff’s request for materials relevant to distributors and resellers.

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7. RFP Nos. 43–70 — “Product Line” Materials
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Each of these requests pertain to Plaintiff’s request for “documents that discuss,
reflect, or relate to the creation, design and manufacture” of specific McGill products.

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ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 5

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Dkt. # 78-3. Defendant responded to each by objecting to disclosure on the grounds that

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the specific products at issue were not specifically named in Plaintiff’s amended

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complaint. As the Court has already explained, that is irrelevant. Plaintiff has stated a

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claim alleging that Defendant’s entire line, of which each of the disputed products is a

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part, “so resemble Tierney Cockburn’s products, with respect to trade dress, that
ordinary consumers are mistaking one for the other.” Amended Complaint (Dkt. # 16)
at ¶ 107. Again, Plaintiff is plainly entitled to the evidence she seeks, and the Court
ORDERS Defendant to produce the requested information.

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8. RFP No. 78 – “Catalog” Materials
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Plaintiff also requested that Defendant produce “documents that discuss, reflect,
or relate to the distribution of catalogs . . . , including[,] but not limited to, mailing lists,

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show marketing reports, business cards, or customer lists.” Dkt. # 78-3. Defendant

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objected on the grounds that the request was “not reasonably calculated to lead to the

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discover of admissible evidence.” Id. The Court disagrees. It is certainly relevant to

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both infringement and damages. Accordingly, the Court ORDERS Defendant to fully

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disclose the requested information.

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9. RFP No. 80 and 84–85 — “Distributor and Retailer” Materials

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Plaintiff’s next request was for documents related to any agreements between

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Defendant and third-parties to distribute or sell the allegedly infringing products and

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product line. Dkt. # 78-3. Defendant asserts that it has complied with that request. Dkt.

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# 79 at 7. In response, Plaintiff contends that Defendant has only provided summary
data, rather than the objective raw data it seeks. Dkt. # 81 at 4. Given the circumstances
and Defendant’s behavior in this case, the Court thinks that request to be eminently

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reasonable. It ORDERS Defendant to provide the requested agreements and documents
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themselves rather than mere summaries.

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ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 6

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9. RFP No. 86–98 — “Financial” Materials

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Finally, Plaintiff requested that Defendant produce specific financial documents

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relevant to the revenue earned by Defendant as a result of its sale of the allegedly

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infringing products and line. Dkt. # 78-3. She asserts that Defendant again provided

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only summaries, not actual objective financial data. Reply (Dkt. # 81) at 4.
In response, Defendant contends that Plaintiff is only entitled to discover its gross
revenue, because the burden is on Defendant to demonstrate any appropriate reductions.
Opp. (Dkt. # 79) at 8–9. While that is certainly a correct statement of the law, see, e.g.,

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Polar Bear Prods., Inc. v. Timex Corp., 384 F.3d 700, 711 (9th Cir. 2004) (“‘In
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establishing the infringer’s profits, the copyright owner is required to present proof only
of the infringer’s gross revenue, and the infringer is required to prove his or her

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deductible expenses and the elements of profit attributable to factors other than the

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copyrighted work.’” (quoting 17 U.S.C. § 504(b))), it does not support Defendant’s

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refusal to produce the requested documents. Unless Defendant wishes to be precluded

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from introducing any evidence of “deductible expenses and the elements of profit

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attributable to factors other than the copyrighted work,” e.g., Dkt. # 78-3 (RFP Nos.

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86–93, 98), it must disclose that evidence to Plaintiff. The same is true of its tax returns.

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Id. (RFP Nos. 95–97).

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Finally, the Court sees no issue with Plaintiff’s request that Defendant disclose
all documents “sufficient to identify all potential and actual manufacturers” of the
relevant products. Id. (RFP Nos. 94). If Defendant did not consider and is not
considering any potential manufacturers, it is certainly free to say so, but the request as a
whole is certainly relevant as to damages.

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In sum, the Court ORDERS Defendant to fully comply with each of Plaintiff’s
requests or run the risk of sanctions, including, but not limited to, the Court “prohibiting

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ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 7

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[Defendant] from supporting or opposing designated claims or defenses, or from

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introducing designated matters in evidence.” Fed. R. Civ. P. 37(b)(2)(A). Defendant

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has received its one and only warning. The Court will not look kindly on any further

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obstructionist behavior.

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B. Award of Fees
Pursuant to Federal Rule of Civil Procedure 37(a)(5)(A), Plaintiff is entitled to

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any “reasonable expenses incurred in making the motion, including attorney’s fees,”
unless:

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(i) the movant filed the motion before attempting in good faith to obtain the
disclosure or discovery without court action;
(ii) the opposing party’s nondisclosure, response, or objection was
substantially justified; or
(iii) other circumstances make an award of expenses unjust.
Defendant has not raised any argument as to why fees and expenses are not warranted in
this case, see Dkt. # 79, and the Court sees no reason not to award Plaintiff her
reasonable expenses.
Plaintiff attempted in good faith to obtain disclosure without court action.

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Plaintiff’s counsel sent Defendants a lengthy letter explaining Plaintiff’s entitlement to
the information she sought, Dkt. # 78-4, and twice conferenced with Defendant in an
attempt to persuade it to furnish the requested information. Moreover, Defendant’s

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positions were entirely unjustified. And, finally, the Court has been presented with no

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evidence of any circumstances that would “make an award of expenses unjust.”

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Accordingly, the Court directs Plaintiff to file a declaration within seven days of

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the date of this Order that sets forth any “reasonable expenses incurred in making th[is]

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motion.”2

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To be clear, time spent meeting and conferring is not included.

ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 8

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C. Oral Argument
Because the Court finds that oral arguments would not aid its resolution of this
dispute, it DENIES Plaintiff’s request.
Notably, though, the Court wishes to correct Defendants’ mistaken belief that
their location out of state is reason enough to preclude oral argument. While the judges
in this district are indeed “committed to assisting the bar and litigants to reduce costs in
civil cases,” that commitment hinges on counsel’s obligation “to work toward the
prompt completion of each case and to minimize the costs of discovery.” Thus, when

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counsel fails to hold up its end of the bargain, and engages in obstructionist tactics that
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lack any substantial justification, it is counsel who is responsible for increasing costs,
including those associated with being ordered to attend a hearing in Seattle.
Should this behavior continue, the Court will not hesitate to require Defendants
and their counsel to explain their conduct in person.
III. CONCLUSION
For all of the foregoing reasons, the Court GRANTS Plaintiff’s motion IN PART.

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Defendant is ORDERED to fully and adequately respond to Plaintiff’s Requests for

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Production Nos. 4, 10–14, 18, 24–28, 32, 38–70, 72, 78, 80, 84–98, and 100 within 21

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days of the date of this Order. In addition, Plaintiff is entitled to her reasonable

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expenses in bringing her motion. Fed. R. Civ. P. 37(a)(5)(A). She is directed to file

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within seven days of the date of this Order a declaration detailing those expenses.

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DATED this 4th day of April, 2012.

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A

Robert S. Lasnik
United States District Judge

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ORDER GRANTING IN PART PLAINTIFF’S
MOTION TO COMPEL AND AWARD SANCTIONS- 9