Insurance King Agency, Inc. v. Digital Media Solutions, LLC et al, No. 3:2021cv01539 - Document 39 (S.D. Cal. 2022)
Court Description: Order Granting in Part and Denying in Part Plaintiff's Motion to Compel (Dkt. No. 31 ). Signed by Magistrate Judge Daniel E. Butcher on 6/30/22. (jmo) Modified on 6/30/2022 to correct text (jmo).
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 INSURANCE KING AGENCY, INC., Plaintiff, 12 13 v. 14 DIGITAL MEDIA SOLUTIONS, LLC, et al., 15 Case No.: 21-cv-1539-BAS-DEB ORDER GRANTING IN PART AND DENYING IN PART PLAINTIFF’S MOTION TO COMPEL [DKT. NO. 31] Defendants. 16 17 18 I. INTRODUCTION 19 Before the Court is Plaintiff Insurance King Agency, Inc.’s Motion to Compel 20 Defendant Digital Media Solutions, LLC Responses to Request for Production, Set One. 21 Dkt. No. 31. Defendants (collectively “Digital Media Solutions”) filed an Opposition. Dkt. 22 No. 32. Having considered the parties’ submissions and supporting exhibits, the Court 23 GRANTS in part and DENIES in part Insurance King’s Motion to Compel. 24 II. BACKGROUND 25 This is a suit for alleged Lanham Act and related California unfair competition 26 violations. Insurance King (an insurance broker specializing in automobile insurance) 27 claims Digital Media Solutions uses Insurance King’s trademarked name in advertisements 28 to generate “leads” that Digital Media Solutions sells to third-party insurance companies. 1 21-cv-1539-BAS-DEB 1 Dkt. No. 24 at 8–9.1 Insurance King alleges Digital Media Solutions “places bids through 2 Google Adwords’ Pay Per Click [(“PPC”)] program” for Insurance King’s trademarked 3 name “specifically targeting customers searching for [Insurance King].” Id. at 7. Once a 4 web user searches for Insurance King, Digital Media Solutions’ advertisements “deceive 5 [that] web user[ ] into the mistaken belief that by clicking through the online advertisement 6 the web user is communicating with [Insurance King].” Id. Digital Media Solutions then 7 sells those leads to third-party insurance companies, who are Insurance King’s competitors. 8 Id. at 8. Insurance King also alleges Digital Media Solutions’ advertisements “falsely lead 9 consumers [who searched for Insurance King] to believe [Digital Media Solutions] itself is 10 an insurance company or broker/agent offering . . . the ‘lowest quotes’ from ‘top rate 11 providers’ ‘in under 60 seconds’ at ‘$1/Day,’” but Digital Media Solutions is not an 12 insurance company, broker, or agent, and it does not “evaluate whether [its] . . . ads . . . are 13 true . . . .” Id. at 8–9. 14 At issue here are Insurance King’s requests for production of documents (“RFP”) 15 seeking: Digital Media Solutions’ gross revenues (RFP No. 26); agreements with and 16 investigations of the third parties to whom Digital Media Solutions sells its leads (RFP 17 Nos. 2 and 3); consumer complaints regarding third parties and PPC advertisements (RFP 18 Nos. 10 and 14); evidence certain third-party insurance companies are Digital Media 19 Solutions’ clients (RFP Nos. 17 through 22); and support for Digital Media Solutions’ 20 claims that third parties are “top rated providers” and offer the “lowest insurance quotes” 21 (RFP Nos. 7 and 9). 22 Defendants objected to each RFP based on relevance, overbreadth, proportionality, 23 privilege, and privacy. Defendants also provided substantive responses to RFP Nos. 7, 9, 24 and 26. 25 26 27 When referencing page numbers for documents filed with the Court, the Court’s citation refers to the page numbers assigned by the Court’s CM-ECF system. 1 28 2 21-cv-1539-BAS-DEB The Court held a discovery conference (Dkt. No. 30), and Insurance King’s Motion 1 2 to Compel followed. 3 III. LEGAL STANDARD 4 “[B]road discretion is vested in the trial court to permit or deny discovery . . . .” 5 Hallett v. Morgan, 296 F.3d 732, 751 (9th Cir. 2002) (quotation omitted). “Parties may 6 obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim 7 or defense and proportional to the needs of the case . . . .” Fed. R. Civ. P. 26(b)(1). Even 8 after the 2015 amendments to Rule 26, “discovery relevance remains a broad concept.” 9 Fed. Nat’l Mortg. Ass’n v. SFR Invs. Pool 1, LLC, No. 14-cv-02046-JAD-PAL, 2016 WL 10 778368, at *2 n.16 (D. Nev. Feb. 25, 2016); see also Odyssey Wireless, Inc. v. Samsung 11 Elecs. Co., Ltd, No. 15-cv-01735-H-RBB, 2016 WL 7665898, at *2 (S.D. Cal. 12 Sept. 20, 2016) (“Relevance is construed broadly to include any matter that bears on, or 13 reasonably could lead to other matters that could bear on, any issue that may be in the 14 case.”) (citing Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 350–51 (1978)). 15 The party seeking to compel discovery has the burden of establishing its request 16 satisfies the relevancy requirements of Rule 26(b)(1). Soto v. City of Concord, 162 F.R.D. 17 603, 610 (N.D. Cal. July 17, 1995). “Once the propounding party establishes that the 18 request seeks relevant and proportional information, ‘[t]he party who resists discovery has 19 the burden to show discovery should not be allowed, and has the burden of clarifying, 20 explaining, and supporting its objections.’” Cancino Castellar v. McAleenan, No. 17-cv- 21 491-BAS-AHG, 2020 WL 1332485, at *4 (S.D. Cal. Mar. 23, 2020) (quoting Superior 22 Commc’ns v. Earhugger, Inc., 257 F.R.D. 215, 217 (C.D. Cal. 2009)). 23 A request for production of documents may relate to any matter that may be inquired 24 into under Rule 26(b). Fed. R. Civ. P. 34(a)(1). For each request for production, “the 25 response must either state that inspection and related activities will be permitted as 26 requested or state with specificity the grounds for objecting to the request, including the 27 reasons.” Fed. R. Civ. P. 34(b)(2)(B). 28 // 3 21-cv-1539-BAS-DEB 1 IV. DISCUSSION 2 Insurance King contends Digital Media Solutions refuses to provide responsive 3 information to RFPs seeking its “gross revenue information that is attributable to 4 [Defendants’] wrongful activity” (RFP No. 26). Dkt. No. 31 at 5. Insurance King further 5 contends Digital Media Solutions is improperly withholding information regarding the 6 third parties that purchase consumer leads (RFP Nos. 2 and 3), consumer complaints (RFP 7 Nos. 10 and 14), other insurance carriers (RFP Nos. 17 through 22), and certain 8 representations on Digital Media Solutions’ website (RFP Nos. 7 and 9). Id. at 13–14. 9 10 11 12 13 14 15 A. Digital Media Solutions’ Gross Revenues (RFP No. 26) Insurance King’s RFP No. 26 seeks: DOCUMENTS which CONCERN or REFLECT financial information as to the revenues and profits YOU have realized through the sale of LEADS including the term ‘KING’, and similar words, in your pick per click advertisements for auto insurance. Dkt. No. 31-2 at 21. 16 Defendants raised various objections to this request (i.e., privacy, privilege, 17 relevance, and proportionality), but proceeded to respond, “[a]fter conducting a diligent 18 search and reasonable inquiry, [Digital Media Solutions] states that it will produce 19 documents responsive to this Request.” Id. at 22. Digital Media Solutions then 20 supplemented its response as follows: “After conducting a diligent search and reasonable 21 inquiry, [Digital Media Solutions] states that it produced documents sufficient to show the 22 revenues and profits to [Digital Media Solutions] associated with the ads placed for auto 23 insurance that related to the search term ‘King.’” Dkt. No. 31-3 at 7. 24 Insurance King argues Digital Media Solutions “indicated initially in its response 25 that it would produce” the gross revenue information “from the sale of all leads” but it 26 “ultimately reneged” and produced only “revenues specifically related to only Insurance 27 King leads.” Dkt. No. 31 at 11–12 (emphasis added). Defendant contends it complied with 28 4 21-cv-1539-BAS-DEB 1 the request, which is “limited to revenues and profits from the sale of leads generated as a 2 result of ads using the term ‘King’ and similar words.” Dkt. No. 32 at 16. 3 The parties’ dispute, therefore, is whether this RFP seeks all gross revenues (as 4 Insurance King contends), or gross revenues generated from “King” leads (as Digital 5 Media Solutions contends). Dkt. Nos. 31 at 11–12; 32 at 16–17. 6 Digital Media Solutions’ reading is consistent with the plain language of the request: 7 “revenues and profits . . . realized through the sale of leads including the term ‘KING’, and 8 similar words.” Digital Media solutions represents it produced documents reflecting 9 revenues and profits “related to the search term ‘King.’” Dkt. Nos. 31-2 at 22; 31-3 at 6– 10 7. That complies with the RFP. The Court, therefore, DENIES Insurance King’s Motion to 11 Compel further responses to RFP No. 26. 12 13 14 15 16 17 18 19 20 21 22 B. Documents Relating to Third-Party Agreements and Investigations (RFP Nos. 2 and 3) Insurance King’s RFP Nos. 2 and 3 seek: RFP No. 2: DOCUMENTS reflecting any agreements between YOU and any THIRD PARTIES to whom you send or sell any LEADS resulting from YOUR pay per click Internet advertising for auto insurance. RFP No. 3: DOCUMENTS evidencing any investigation or examination by YOU of the background, business reputation, financial status, products offered or reviews of the THIRD PARTIES to whom you sell or offer to sell the LEADS for auto insurance. Dkt. No. 31-2 at 6–7. 23 Digital Media Solutions objects that the requests: (1) seek “confidential business or 24 commercial documents and/or proprietary information”; (2) are irrelevant; (3) seek 25 documents protected from disclosure by the attorney client privilege and work product 26 doctrine; (4) are overbroad; (5) are unduly burdensome; and (6) are disproportionate to the 27 needs of the case. Id. 28 5 21-cv-1539-BAS-DEB 1 Insurance King explains these requests seek discovery into Digital Media Solutions’ 2 representations that third parties purchasing Digital Media Solutions’ leads are “top rated 3 providers.” Dkt. No. 31 at 13. The Court agrees this is relevant discovery as it pertains to 4 Insurance King leads. To the extent the requests seek broader information (e.g., documents 5 relating to third parties not involved in Digital Medial Solutions’ sale of Insurance King 6 leads), however, these requests are overbroad and not proportionate to the needs of this 7 case. The misrepresentations alleged in Plaintiff’s First Amended Complaint all arise out 8 of allegedly misappropriated Insurance King leads. Dkt. 24 at 12–13 and 25. Plaintiff’s 9 RFPs, however, seek documents regarding third parties not associated with Insurance King 10 leads. 11 The Court, therefore, sustains Digital Media Solution’s overbreadth and 12 proportionality objections and limits both requests to third parties to whom Digital Media 13 Solutions sold leads and advertising implicating Insurance King’s trademarked name. See 14 Green v. Baca, 219 F.R.D. 485, 490 (C.D. Cal. 2003) (“It is within the discretion of a court 15 ruling on a motion to compel to narrow the requests rather than sustain the responding 16 party’s objections to them in toto. In doing so, the court effectively sustains an objection 17 that the requests are . . . overbroad in part, and overrules it in part.”).2 18 19 The Court overrules the remainder of Digital Media Solutions’ objections. Digital Media Solutions’ objection that third-party discovery requests seek “highly sensitive commercial information” about Insurance King’s competitors (Dkt. No. 32 at 21–22) is mitigated by the Court’s Protective Order (Dkt. No. 19). See Lauter v. Rosenblatt, No. 15cv-08481-DDP-KSx, 2019 WL 4138020, at *15 (C.D. Cal. July 1, 2019) (“The purpose of a protective order during discovery is to preserve rights of privacy and confidentiality as to the disclosure for personal and/or commercially sensitive information.”). Digital Media Solutions’ privilege and unduly burdensome objections are waived because Digital Media Solutions did not raise them in its Opposition and there is no evidence Digital Media Solutions provided Insurance King a privilege log. See Sherwin-Williams Co. v. Earl Scheib of Cal. Inc., No. 12-cv-2646-JAH-JMA, 2013 WL 12073836, at *2 n.1 (S.D. Cal. Mar. 4, 2013) (objections raised in response to the discovery requests but not addressed in the discovery motion are moot or waived; limiting its review to arguments in the parties’ briefs); Cartwright v. Viking Industries, Inc., 2008 WL 4283614 at *2 (E.D. Cal. 2 20 21 22 23 24 25 26 27 28 6 21-cv-1539-BAS-DEB 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 Therefore, on or before July 15, 2022, Digital Media Solutions must produce responsive documents to the following revised RFP Nos. 2 and 3: Revised RFP No. 2: DOCUMENTS reflecting any agreements between YOU and any THIRD PARTIES to whom you send or sell LEADS arising out of the term “KING,” and similar words, in your pay per click advertisements for auto insurance. Revised RFP No. 3: DOCUMENTS evidencing any investigation or examination by YOU of the background, business reputation, financial status, products offered or reviews of the third parties to whom you send or sell LEADS arising out of the term “KING,” and similar words, in your pay per click advertisements for auto insurance. C. Consumer Complaints Regarding Advertisements (RFP Nos. 10 and 14) Third Parties and PPC Insurance King’s RFP Nos. 10 and 14 seek: RFP No. 10: COMMUNICATIONS to YOU or DOCUMENTS which evidence or refer to any complaints by consumers regarding any of the THIRD PARTIES to whom YOU have sold LEADS regarding auto insurance. 19 RFP No. 14: COMMUNICATIONS to YOU or DOCUMENTS which evidence same of any complaints by consumers regarding any of the pay per click ads you have placed on the Internet regarding the sale or availability of auto insurance. 20 Dkt. No. 31-2 at 11, 13. Digital Media Solutions objects, in pertinent part, that the requests 21 are overbroad and seek irrelevant information. Id. 17 18 22 Insurance King argues “these requests are directly relevant to the veracity of th[e] 23 statement [that the third parties purchasing Defendants’ leads are ‘top rated providers’], 24 25 26 27 Sept. 11, 2008) (The failure to produce a privilege log to support an assertion of privilege “may be deemed to waive it.”). 28 7 21-cv-1539-BAS-DEB 1 whether [Digital Media Solutions] had any basis for this statement, and if there has been 2 actual consumer confusion . . . .” Dkt. No. 31 at 13. 3 Insurance King’s requests are overbroad because they seek all consumer complaints, 4 regardless of whether those complaints relate to the allegations in Plaintiff’s First Amended 5 Complaint. 6 The Court sustains Digital Media Solution’s overbreadth objection and limits the 7 requests to complaints with Insurance King’s trademarked name.3 Therefore, on or before 8 July 15, 2022, Digital Media Solutions must produce responsive documents to the 9 following revised RFP Nos. 10 and 14: 10 Revised RFP No. 10: COMMUNICATIONS to YOU or DOCUMENTS which evidence or refer to any complaints by consumers regarding any of the THIRD PARTIES to whom you have sold LEADS for auto insurance arising out of pay per click advertisements including the term “KING,” and similar words. 11 12 13 14 Revised RFP No. 14: COMMUNICATIONS to YOU or DOCUMENTS which evidence any complaints by consumers regarding the pay per click ads for auto insurance you have placed on the Internet that included the term “KING,” and similar words. 15 16 17 D. Documents Showing Digital Media Solutions’ Clients (RFP Nos. 17–22) 18 19 Insurance King’s RFP Nos. 17 through 22 seek documents relating to whether 20 Adriana’s Insurance, Pronto Insurance, Law Familia Insurance, Kemper Insurance, Fred 21 Loyas Insurance, and AMAX Auto Insurance are Defendants’ clients. Without providing 22 responsive documents, Digital Media Solutions objected that these RFPs are overbroad, 23 unduly burdensome, not proportional, irrelevant, and seek privileged and private 24 information. 25 26 27 The Court overrules Digital Media Solutions’ remaining objections (privacy, privilege, and unduly burdensome) for the same reasons discussed in footnote 2 above. 3 28 8 21-cv-1539-BAS-DEB 1 Insurance King does not assert the listed entities are among the third parties to whom 2 Digital Media Solutions sold leads. Instead, Insurance King “believes . . . [Digital Media 3 Solutions] has no relationship with these insurance brokers/carriers, but simply uses their 4 names in its advertising as a deceptive practice” the same way Digital Media Solutions 5 “has used Insurance King’s trademark to deceive consumers . . . .” Dkt. No. 31 at 14. 6 Insurance King argues this information is “directly relevant to” Defendants’ “mental state” 7 (i.e., why would Digital Media Solutions “essentially admit its practice is wrongful by 8 agreeing to be enjoined from the practice vis-á-vis Insurance King but then continue to 9 engage in the same practice vis-á-vis other brokers”?). Id. 10 Insurance King has not carried its burden of establishing the relevance of these 11 requests. Whether Digital Media Solutions violated the rights of other brokers after 12 agreeing to an injunction with Insurance King is not relevant to any claim in this case. To 13 the extent the requested discovery has any arguable relevance, the Court exercises its 14 discretion to disallow the discovery here in light of its tangential nature. See Strategic 15 Partners, Inc. v. FIGS, Inc., No. 19-cv-2286-GW-KSx, 2021 WL 4813646, at *4 (C.D. 16 Cal. Aug. 12, 2021) (“In resolving discovery disputes, the court may exercise its discretion 17 in determining the relevance of discovery requests, assessing oppressiveness, and weighing 18 those facts in deciding whether discovery should be compelled.”) (quotation omitted); 19 McCall v. State Farm Mut. Auto. Ins. Co., No. 16-cv-01058-JAD-GWF, 2017 WL 20 3174914, at *9 (D. Nev. July 26, 2017) (“If the requirement for proportionality in discovery 21 means anything . . . it must mean that burdensome, tangential discovery should not be 22 permitted based on the mere possibility that something may turn up to support what is 23 otherwise only speculation.”). The Court, therefore, denies Insurance King’s Motion to Compel further responses 24 25 to RFP Nos. 17 through 22. 26 // 27 // 28 // 9 21-cv-1539-BAS-DEB E. Documents Supporting Digital Media Solutions’ Claims that Third Parties Are “top rated providers” and Offer the “lowest insurance quotes” (RFP Nos. 7 and 9) 1 2 3 Insurance King’s RFP Nos. 7 and 9 (seeking documents “which support . . . that 4 consumers will obtain the ‘lowest insurance quotes’” and “which identify ‘top rated 5 providers’”) (Dkt. No. 31-1 at 9–11) are not properly before the Court. Defendants claim 6 the parties have not met and conferred regarding them (Dkt. No. 32 at 20), and they were 7 neither discussed during the Court’s Discovery Conference nor included in the Court’s 8 subsequent briefing schedule.4 The Court agrees. The parties must comply with the Court’s 9 chambers rules, local rules, and Federal Rules of Civil Procedure prior to raising any 10 discovery dispute with the Court. The Court, therefore, DENIES Insurance King’s Motion 11 to Compel further response to RFP Nos. 7 and 9. Shaw v. Cty. of San Diego, No. 06-cv- 12 2680-IEG-POR, 2008 WL 9411414, at *2 (S.D. Cal. Oct. 9, 2008) (denying plaintiff's 13 motion to compel for failing to meet and confer). 14 V. 15 CONCLUSION Based on the foregoing, the Court GRANTS in part and DENIES in part Insurance 16 King’s Motion to Compel. Dkt. No. 31. On or before July 15, 2022, Digital Media 17 Solutions must provide responsive information to Insurance King’s RFP Nos. 2, 3, 10, and 18 14 as revised herein. 19 20 IT IS SO ORDERED. Dated: June 30, 2022 21 22 23 24 25 26 27 28 Additionally, based on Digital Media Solutions agreement to “produce all documents responsive” (Dkt. No. 31-2 at 10), any issues regarding this RFP appear moot. 4 10 21-cv-1539-BAS-DEB
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