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Marjam Supply Company of Florida, LLC v. Pliteq, Inc.

United States District Court, S.D. Florida

March 23, 2018

MARJAM SUPPLY COMPANY OF FLORIDA, LLC and MARJAM SUPPLY COMPANY, Plaintiffs,
v.
PLITEQ, INC. and PAUL DOWNEY, Defendants, PLITEQ, INC. and PAUL DOWNEY, Counter-Plaintiffs,
v.
MARJAM SUPPLY COMPANY OF FLORIDA, LLC; MARJAM SUPPLY COMPANY; and JIM METCALF, Counter-Defendants.

          ORDER GRANTING PLITEQ, INC., AND PAUL DOWNEY'S MOTION TO COMPEL ECORE INTERNATIONAL, INC.'s COMPLIANCE WITH SUBPOENA TO PRODUCE DOCUMENTS

          ANDREA M. SIMONTON CHIEF UNITED STATES MAGISTRATE JUDGE

         This matter is before the Court upon Defendants Pliteq, Inc., and Paul Downey's Motion to Compel Ecore International, Inc.'s Compliance with Subpoena to Produce Documents, ECF No. [109-2]. Non-Party Ecore has filed an Opposition to the Motion, ECF No. [109-3], and Defendants have filed a Reply, ECF No. [109-4].[1]The Honorable Kathleen M. Williams, United States District Judge, has referred discovery matters to the undersigned Magistrate Judge, ECF No. [63]. The Parties have also filed a Stipulation Regarding Deposition After Discovery Date, ECF No. [146], wherein they agree that the deposition of non-party Ecore International, Inc., may occur after the close of discovery on December 20, 2017.

         I. MOTION TO COMPEL

         Defendants have filed the instant Motion seeking to compel Ecore International, Inc., (“Ecore”) to comply with a subpoena to produce the following documents: 1) nine (9) documents previously produced in a civil action pending between Pliteq and Ecore in a Pennsylvania-based action; and, 2) relevant responsive documents in limited categories that post-date Ecore's final production in that Pennsylvania action, (“Pennsylvania Litigation”), ECF No. [109-2]. Defendants contend that the documents sought are highly relevant to Defendant Pliteq's Counterclaims in this action. In support of this contention, Defendants explain that Pliteq's breach of contract counterclaim stems from a distribution agreement between Pliteq and Marjam whereby Pliteq gave Marjam the right to buy Pliteq product at a significantly reduced price in exchange for Marjam's service as Pliteq's distributor in a region of Florida, and Marjam's promise not to sell products that compete with Pliteq's products, ECF No. [109-2] at 3. The Defendants contend that the agreement specifically prohibited Marjam from selling or promoting competitive products such as Ecore QT, and, further contend that shortly after entering in the agreement, Marjam breached that agreement by selling the Ecore QT product. ECF No. [109-2] at 3. The Defendants also allege that Ecore's president and CEO, Art Dodge, had direct communications with Marjam related to Marjam's action against Pliteq.

         Defendants contend that production of the nine requested documents from the Pennsylvania Litigation will place no burden on Ecore because the documents were previously produced and have already been Bates stamped, ECF No. [109-2] at 6. Further, the Defendants contend that Marjam has not produced the documents in this action, and state that Marjam asserts that those documents have been destroyed or lost, ECF No. [109-2] at 7. As to the Defendants' request that Ecore search for additional relevant responsive documents in limited categories that post-date Ecore's final production in the Pennsylvania Litigation, the Defendants contend that those documents are relevant because Marjam (through its product manager, Jim Metcalf), has engaged in a series of actions intended to interfere with Pliteq's business after the Pliteq-Marjam contract was terminated on July 10, 2015, ECF No. [109-2] at 8. The Defendants state that they only request that Ecore search for documents in limited categories during a time period of about a year.[2]

         In support of their Motion, the Defendants have submitted the Declaration of Jennifer Theis, Counsel for the Defendants, ECF No. [109-1]. In that Declaration, Ms. Theis states that documents produced by Marjam reveal that Ecore's president and CEO, Art Dodge, had direct communications with Marjam related to Marjam's action against Pliteq, ECF No. [109-1] at 1. She also states that on March 29, 2017, Ecore responded to Pliteq's subpoena with various objections and a request that Pliteq identify which documents from the Pennsylvania Litigation that it sought to use in the Florida Litigation. The Declaration further states that on May 2, 2017, Pliteq agreed to limit the subpoena to eleven documents produced in the Pennsylvania Litigation and any additional communications between Art Dodge and Jim Metcalf relating to the four categories listed in the subpoena.[3] Attached to the Declaration are the referenced communications between Counsel for Ecore and Defendants related to the subpoena at issue, as well as the nine documents from the Pennsylvania Litigation that are at issue in the Motion to Compel. Those documents were filed under seal. See ECF No. [109-2] (sealed).

         In response, Ecore, a non-party in this action, contends that the Defendants' subpoena improperly seeks the production of documents that are protected by the protective order issued on April 4, 2016 in the Eastern District of Pennsylvania action (Pennsylvania Litigation) of Ecore International, Inc. v. CSR Industries et al., Civ. A. No. 11-cv-6843, ECF No. [109-3] at 1.[4] Ecore further argues that the Defendants have violated their duty under Federal Rule of Civil Procedure 45 to take reasonable steps to avoid causing undue burden and expense on Ecore in responding to the subpoena, ECF No. [109-3] at 1. Specifically, Ecore asserts that Pliteq had the opportunity to request documents from Ecore relating to the Florida Litigation at the same time Ecore was performing electronic searches and gathering documents for the Pennsylvania Litigation. Ecore argues that had Pliteq promptly sought third-party discovery in the Florida Litigation at that time, Pliteq could have saved Ecore the burden and expense of having to conduct a second electronic search at a later time.

         As to the specific documents sought by the Defendants, according to the Response, after Ecore and Pliteq engaged in negotiations regarding the Pliteq subpoena, Ecore agreed to produce two documents that had been previously produced in the Pennsylvania Litigation: 1) a spreadsheet demonstrating the sales of certain products from Ecore to Marjam from January 2011 through August 2015; and, 2) an email between Ecore employees and Marjam employees that predated the termination of the contract between Marjam and Pliteq, ECF No. [109-3] at 6. However, Ecore refused to produce the remaining nine documents and refused to perform electronic searches for emails between Arthur Dodge, III and Jim Metcalf from April 12, 2016 through the present. Ecore contends “[t]hese additional searches would not be necessary if Pliteq had moved its case forward and sought discovery promptly.” ECF No. [109-3] at 6.

         Ecore further argues that Pliteq has failed to demonstrate that the documents sought are relevant to this action, and that the discovery is proportional to the needs of this case, ECF No. [109-3] at 8. On this issue, Ecore argues that the subpoena requests are overbroad and should be limited in time. In addition, Ecore contends that it does not have documents responsive to Requests 2, 3 and 4 for the period between March 17, 2014 and July 10, 2015, ECF No. [109-3] at 9. Ecore further argues that Pliteq's tortious interference counterclaims are unrelated to Ecore, ECF No. [109-3] at 9. Finally, Ecore argues that the requested production would cause an undue burden on Ecore and anticipates that the search and production of emails from April 2016 to the present would cost approximately $2, 400.00 in internal costs, and approximately $3, 000.00 to hire a vendor to process and Bates number the documents, plus reasonable attorneys' fees for review of the documents to ensure no privileged documents are produced, ECF No. [109-3] at 10.

         Ecore thus argues that the Motion to Compel should be denied; but, argues in the alternative, that the Defendants should be sanctioned and assessed the costs of the electronic searches, processing, and Bates numbering of the documents, as well as be required to pay attorneys' fees incurred by Ecore in complying with this Court's Order, ECF No. [109-3] at 11.

         In Reply, the Defendants contend that the letter and spirit of the Pennsylvania Litigation protective order has been followed because the documents from that case that are at issue in this case were filed under seal and have not been used in this action, ECF No. [109-4] at 3. In addition, the Defendants assert that it was Ecore that asked Pliteq to identify the documents from the Pennsylvania Litigation that were relevant to the Florida Litigation. The Defendants also note the Ecore failed to submit an affidavit to support its contention that producing the requested documents would cause a burden on Ecore.

         II. LEGAL FRAMEWORK

         A. Subpoenas Issued Pursuant to Rule 45

         Federal Rule of Civil Procedure 45 addresses the issuance and enforcement of subpoenas. Subpart (d)(3)(A) of Rule 45 permits a court to quash a subpoena if, among other things, the subpoena requires disclosure of privileged or other protected matter, if no exception or waiver applies, or subjects a person to undue burden. Rule 45(d)(3)(A)(iii) and (iv). Rule 45 further provides, (d) Protecting a Person Subject to a Subpoena; Enforcement.

(1) Avoiding Undue Burden or Expense; Sanctions. A party or attorney responsible for issuing and serving a subpoena must take reasonable steps to avoid imposing undue burden or expense on a person subject to the subpoena. The court for the district where compliance is required must enforce this duty and impose an appropriate sanction--which may include lost earnings and reasonable attorney's fees--on a party or attorney who fails to comply.

Fed. R. Civ. P. 45(d)(1). Although Rule 45 does not identify irrelevance or overbreadth as grounds for quashing a subpoena, courts treat the scope of discovery under a subpoena the same as the scope of discovery under Rule 26. Am. Fed'n of State, Cnty. & Mun. Employees (AFSCME) Council 79 v. Scott, 277 F.R.D. 474, 476 (S.D. Fla. 2011) (citations omitted). See also Digital Assurance Certification, LLC v. Pendolino, No. 6:17-cv-72-Orl-41TBS, 2017 WL 4342316 *8 (M.D. Fla. Sept. 29, 2017) (stating “The scope of discovery under Rule 45 is the same as the scope of discovery under Federal Rule of Civil Procedure 26.”)); Commissariat A L'Energie Atomique v. Samsung Elecs. Co., LTD., Case No. 8:06-mc-44-T-30TBM, 2006 WL 5003562, at *2 (M.D. Fla. June 14, 2006) (noting that while Rule 45 does not include relevance as an enumerated reason for quashing or modifying a subpoena, it is well settled that the scope of discovery under a subpoena is the same as the scope of discovery under Rule 26(b), Federal Rules of Civil Procedure, and, as a result, a court must examine whether a request contained in a subpoena duces tecum is overly broad or seeks irrelevant information under the same standards set forth in Rule 26(b)).

         B. Scope of Discovery Subpoenas Under Rule 26

         Federal Rule of Civil Procedure ...


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