NuVasive, Inc. v. Absolute Medical LLC, No. 3:2018cv01844 - Document 14 (S.D. Cal. 2018)
Court Description: ORDER denying Plaintiff's Motions 2 , 9 , and 10 . Plaintiffs Motions to Compel are DENIED. The subject subpoenas are quashed. The Court invites Mr. Cochran, on behalf of Mr. Miles and Mr. Hunsaker, to submit a new motion for recovery of f ees reflecting his actual time. That motion, should Mr. Cochran and his clients decide to file it, must be filed within two weeks of the date of this Order. Plaintiff will have one week to file any opposition. Signed by Magistrate Judge Mitchell D. Dembin on 10/26/2018. (amm)
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 12 NUVASIVE, INC., Plaintiff, 13 14 Case No.: 18cv1844-GPC-MDD v. 15 16 ABSOLUTE MEDICAL, LLC, et al., 17 Defendants. 18 19 20 21 22 23 24 25 26 27 ORDER ON NUVASIVE’S MOTIONS TO COMPEL NONPARTIES ALPHATEC SPINE INC., PATRICK MILES AND CRAIG HUNSAKER TO COMPLY WITH SUBPOENAS [ECF NOS. 2, 9 and 10] BACKGROUND Before the Court are three motions to compel compliance with subpoenas issued in connection with a case pending in the Middle District of Florida, NuVasive Inc. v. Absolute Medical, LLC, Absolute Medical Systems, LLC, Greg Soufleris, Dave Hawley and Ryan Miller, Civil Case No. 6:17cv2206-ORL-41GJK. The lawsuit alleges that Defendant Absolute Medical, LLC, violated a contract with Plaintiff in which Defendant was bound to sell Plaintiff’s products exclusively. The Complaint alleges that 1 18cv1844-GPC-MDD 1 Defendant Soufleris, the owner of Absolute Medical, LLC, formed Absolute 2 Medical Systems, LLC, (“AMS”) to avoid contractual limitations. Defendants 3 Hawley and Miller are alleged to be salespersons who participated in the 4 breach of contract by selling and attempting to sell competitor’s products. A 5 copy of the First Amended Complaint in the underlying action was filed in 6 connection with this motion at ECF No. 9-3. The FAC identifies the 7 competitor as Alphatec Spine, Inc. NuVasive has sued Alphatec for patent 8 infringement in this Court in Case No. 18-cv-0347-CAB-MDD. 9 Pursuant to Rule 45, Fed. R. Civ.P., Plaintiff served subpoenas duces 10 tecum upon Alphatec, its CEO and Chairman, Patrick Miles, and its General 11 Counsel, Craig Hunsaker. Each objected to the subpoenas and did not 12 comply. Plaintiff moved to compel Alphatec to comply on August 6, 2018. 13 (ECF No. 2). On August 17, 2018, Plaintiff moved to compel Mr. Miles (ECF 14 No. 10) and Mr. Hunsaker (ECF No. 9) to comply. Each timely responded in 15 opposition. 16 17 LEGAL STANDARDS Rule 45 governs obtaining information by subpoena from non-parties. 18 Under Rule 45(d)(1), the requesting party or attorney “must take reasonable 19 steps to avoid imposing undue burden or expense on a person subject to the 20 subpoena.” A non-party subject to a subpoena duces tecum “deserve[s] extra 21 protection from the courts.” High Tech Medical Instrumentation v. New 22 Image Indus., 161 F.R.D. 86, 88 (N.D.Cal.1995) (citing United States v. 23 Columbia Broadcasting System, 666 F.2d 364, 371–72 (9th Cir.1982)). 24 And, Rule 45(d)(1) requires this Court, the court where compliance is 25 required, to “enforce this duty and impose an appropriate sanction . . . on a 26 party or attorney who fails to comply.” 27 Apart from the special duty imposed on the requesting party by Rule 2 18cv1844-GPC-MDD 1 45(d)(1), Rule 26(b), Fed. R. Civ. P., provides that discovery may be obtained 2 only if it is relevant to any party’s claim or defense and proportional to the 3 needs of the case. See Soto v. Castlerock Farming & Transp., Inc., 282 F.R.D. 4 492, 503 (E.D. Cal. 2012). 5 6 DISCUSSION First, regarding relevance, Plaintiff states, upon information and belief, 7 that the respondents have relevant information because of the allegations in 8 the underlying action that Defendants breached their agreements with 9 Plaintiff by selling Alphatec products. (See ECF No. 2 at 6, ECF No. 9-1 at 5, 10 ECF No. 10-1 at 5). This assertion, coupled with an alleged admission by 11 Defendant Soufleris that he and Defendant Hawley communicated with 12 Alphatec, is sufficient to satisfy the relevance requirement for the subpoena 13 to Alphatec. But there is nothing in the pleadings nor in the FAC to support 14 Plaintiff’s “information and belief” that Mr. Miles or Mr. Hunsaker personally 15 have relevant information. On this basis alone, the Court denies the motion 16 to compel and quashes the subpoenas to Mr. Miles and Mr. Hunsaker. 17 Also, the subpoenas to Mr. Miles and Mr. Hunsaker, which appear to be 18 identical, call for the production of business communications and documents 19 of Alphatec. Plaintiff presents nothing suggesting that these individuals 20 possess information beyond that which could be obtained from Alphatec. 21 Moreover, to the extent that the subpoenas call for the production of 22 documents and communications with Defendants, Plaintiff provides no basis 23 for believing that this information is not available from Defendants. Courts 24 have expressed a preference for parties to obtain discovery from one another 25 before burdening non-parties with discovery requests. See Soto, 282 F.R.D. 26 at 505. Plaintiff admits to having received many of the documents requested 27 in the subpoena from Defendants including agreements, sales and 3 18cv1844-GPC-MDD 1 commission data and communications between Alphatec and Absolute 2 Medical employees. (See ECF No. 2 at 9). Plaintiff does not suggest that the 3 production had gaps that may be remedied by obtaining the requested 4 information from these individuals. See Shasta Linen Supply, Inc., v. 5 Applied Underwriters, Inc., Nos. 2:16-cv-00158 and 01211, 2018 WL 2981827 6 *4 (E.D. Ca. June 14, 2018). Consequently, in addition to denying the 7 motions to compel compliance by Mr. Miles and Mr. Hunsaker because of lack 8 of relevance, the motions are denied for Plaintiff’s failure to take reasonable 9 steps to avoid an undue burden upon these individuals. 10 Regarding the subpoena to Alphatec, although general relevance has 11 been demonstrated, the Court finds that Plaintiff failed to take reasonable 12 steps to avoid undue burden to Alphatec and has not demonstrated relevance 13 regarding certain requests. As mentioned above, Plaintiff admits to having 14 received many of the documents requested in the subpoena from Defendants 15 including agreements, sales and commission data and communications 16 between Alphatec and Absolute Medical employees. (See ECF No. 2 at 9). 17 Plaintiff does not suggest that the production had gaps that may be remedied 18 by obtaining the requested information from Alphatec. See Shasta Linen 19 Supply, Inc., v. Applied Underwriters, Inc., Nos. 2:16-cv-00158 and 01211, 20 2018 WL 2981827 *4 (E.D. Ca. June 14, 2018). Plaintiff asserts that 21 communications between Alphatec and individuals not employed by 22 Defendants could not be obtained from Defendants. Plaintiff does not 23 identify those individuals in their brief but a review of the subpoena leads the 24 Court to believe that Plaintiff is referring to “Liz Lukianov” and “Brian 25 Gottstein.” (See ECF No. 11-2 at 10-11). 26 27 In the FAC, Mr. Gottstein is alleged to be a former employee of Absolute who now works for Alphatec. No reason, beyond that, is given to support 4 18cv1844-GPC-MDD 1 asserted information and belief that all of Alphatec’s communications with 2 Mr. Gottstein are relevant. At a minimum, the Gottstein requests are 3 overbroad. Moreover, if the allegation is that Mr. Gottstein assisted in 4 Absolute’s breach of contract while he was employed with Absolute, those 5 records should be obtained in the first instance from Absolute or a more 6 focused request should have been propounded. The Court could not find a 7 reference to Ms. Lukianov in the FAC nor in Plaintiff’s moving papers. 8 9 SANCTIONS Having found the subpoenas were served by Plaintiff without taking 10 reasonable steps to avoid imposing an undue burden, the Court is required, 11 under Rule 45(d)(1), to consider sanctions. Regarding the subpoena to 12 Alphatec, the Court finds that sanctions are not warranted because the 13 majority of the information sought is relevant. Plaintiff’s error is in failing to 14 demonstrate that the production of these very records from Defendants was 15 insufficient. To the extent that Plaintiff failed to demonstrate relevance 16 regarding Ms. Lukianov and Mr. Gottstein, although sanctions could be 17 awarded regarding that portion of the request, respondent Alphatec spent 18 little to no time addressing these individuals. 19 It is a different matter regarding the subpoenas to Patrick Miles and 20 Craig Hunsaker. Plaintiff provides no basis to believe that these individuals, 21 the CEO and General Counsel respectively of Alphatec, personally possess 22 the information requested. The Court is of the firm belief that the subpoenas 23 to these individuals were served in bad faith, intended only to harass. The 24 Court believes that the reasonable attorney’s fees incurred by Mr. Miles and 25 Mr. Hunsaker should be recovered from Plaintiff. 26 27 Mr. Miles and Mr. Hunsaker had the same lawyer, Keith M. Cochran, Esquire, who submitted declarations regarding his background, the time 5 18cv1844-GPC-MDD 1 spent responding to each motion to compel and his hourly rate. Regarding 2 Mr. Miles, Mr. Cochran claims that he spent 9.5 hours researching and 3 drafting the responsive papers. At his rate of $520 per hour, he claims that 4 Mr. Miles incurred fees of $4940. (See ECF No. 12-1 ¶ 8). Regarding Mr. 5 Hunsaker, Mr. Cochran claims that he spent 6.9 hours researching and 6 drafting the responsive papers resulting in $3588 in legal fees. 7 Reviewing the opposition papers filed by Mr. Cochran on behalf of Mr. 8 Miles and Mr. Hunsaker, the Court considers them to be substantially 9 identical. Mr. Cochran cannot be paid twice for the same work. The Court 10 invites Mr. Cochran, on behalf of Mr. Miles and Mr. Hunsaker, to submit a 11 new motion for recovery of fees reflecting his actual time. That motion, 12 should Mr. Cochran and his clients decide to file it, must be filed within two 13 weeks of the date of this Order. Plaintiff will have one week to file any 14 opposition. CONCLUSION 15 16 Plaintiff’s Motions to Compel are DENIED. The subject subpoenas are 17 quashed. 18 Dated: October 26, 2018 19 20 21 22 23 24 25 26 27 6 18cv1844-GPC-MDD
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