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Mustang Innovation, LLC v. Sonoco Products Co.

United States District Court, D. South Carolina, Florence Division

July 24, 2015

Mustang Innovation, LLC, Plaintiff,
v.
Sonoco Products Company, Defendant. Sonoco Products Company, Counterclaim Plaintiff,
v.
Mustang Innovation, LLC and William Fielding Jones, Counterclaim Defendants.

ORDER

R. BRYAN HARWELL, District Judge.

INTRODUCTION

This matter is before the court on Defendant/Counterclaim Plaintiff Sonoco Products Company's ("Defendant" or Sonoco") Motion to Quash, filed March 19, 2015. See Def.'s Mot., ECF No. 21. Defendant seeks to quash three subpoenas issued by Plaintiff/Counterclaim Defendant Mustang Innovation, LLC ("Plaintiff" or "Mustang") on March 6, 2015. See id. at 1. Plaintiff timely filed a response in opposition to Defendant's motion on April 6, 2015. See Pl.'s Resp., ECF No. 24. Defendant then filed a reply in support of its motion on April 16, 2015. See Def.'s Reply, ECF No. 27. For the reasons stated below, the Court denies Defendant's motion.

STANDARD

I. Scope of Discovery

Rule 26(b)(1) governs the scope of discovery and provides that:

Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense-including the existence, description, nature, custody, condition, and location of any documents or other tangible things and the identity and location of persons who know of any discoverable matter. For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence. All discovery is subject to the limitations imposed by Rule 26(b)(2)(C).

Fed. R. Civ. P. 26(b)(1). Relevant information is a broader concept than admissible evidence. To be relevant, information need only be calculated to lead to the discovery of admissible evidence, it need not be admissible itself. "Relevant evidence" is defined to mean evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence. Fed.R.Evid. 401. "On relevancy matters, the trial court has broad discretion." Watson v. Lowcountry Red Cross, 974 F.2d 482, 489 (4th Cir. 1992). The court may restrict the discovery of otherwise allowable information if it determines that "the discovery sought is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive." Fed.R.Civ.P. 26(b)(2)(C)(i). The Court may also restrict discovery where "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)(iii). Broad discretion is afforded a district court's decision to grant or deny a motion to compel. Erdmann v. Preferred Research Inc. of Ga., 852 F.2d 788, 792 (4th Cir. 1988) (citation omitted).

II. Motions to Quash Subpoena

Mustang served subpoenas on the following: 1) Mark Oser and WDO Enterprises; 2) Keith Ogren and White Rock Consulting; and 3) Mike Parkinson and Pro Pack Services. Oser, Ogren, and Parkinson previously worked as independent contractors for Mustang. Each subpoena sought any and all communications between the individuals through their respective companies and Modulus Sourcing as well as any and all communications with Sonoco or any supplier in the corrugated industry.

Under Rule 45 of the Federal Rules of Civil Procedure, a "command in a subpoena to produce documents... requires the responding person to permit inspection, copying, testing, or sampling of the materials." Fed.R.Civ.P. 45(a)(1)(D). If the person commanded to produce documents makes a timely written objection, "the serving party may move the court for the district where compliance is required for an order compelling production or inspection." Fed.R.Civ.P. 45(d)(2)(B)(i). A court may, on timely motion, quash or modify a subpoena that subjects a person to undue burden or requires disclosure of privileged or other protected matter. Fed.R.Civ.P. 45(d)(3)(A). "Ordinarily only the party or person to whom the subpoena is directed has standing to move to quash or otherwise object to a subpoena.'" In re C.R. Bard, Inc. Pelvic Repair Sys. Prod. Liab. Litig., MDL No. 2187, 2014 WL 1660386, at *2 (S.D. W.Va. Apr. 22, 2014) (quoting Transcor, Inc. v. Furney Charters, 212 F.R.D. 588, 590 (D. Kan. 2003)). An exception exists, however, when the person objecting to the subpoena has a personal right or privilege in the information sought by the requester. United States v. Idema, 118 F.Appx. 740, 744 (4th Cir. 2005) (citations omitted). "[T]he scope of discovery allowed under a subpoena is the same as the scope of discovery allowed under Rule 26." HDSherer LLC v. Natural Molecular Testing Corp., 292 F.R.D. 305, 308 (D.S.C. 2013) (citing Cook v. Howard, 484 F.Appx. 805, 812 (4th Cir. 2012)).

III. Trade Secrets/Proprietary Information

Defendant has objected on the basis that Plaintiff seeks documents that contain its proprietary information, intellectual property, and trade secrets. See ECF No. 21 at 2. In seeking to prevent discovery based on a trade secrets claim, the party resisting discovery must "demonstrate to the Court that the information being sought is a trade secret and that its disclosure might be harmful." In re Sealed Air Corp., 220 F.R.D. 452, 453 (D.S.C. 2004) (citing Coca-Cola Bottling Co. of Shreveport, Inc. v. Coca-Cola Co., 107 F.R.D. 288, 292 (D. Del. 1985)). "Once shown, the burden shifts to the party that seeks the discovery to establish the relevance of the trade secret to the lawsuit and that it is necessary to the action." Id. (citing Coca-Cola, 107 F.R.D. at 292). Finally, "if relevance and necessity are established, the Court must balance the need for the information against the injury that would ensue if disclosure is ordered.'" Id. (quoting Coca-Cola, 107 F.R.D. at 292).

"There is no absolute privilege to protect trade secrets from disclosure during the discovery process." Id. (citing Duplan Corp. v. Deering Milliken, Inc., 397 F.Supp. 1146, 1185 (D.S.C. 1974)). Discovery of confidential information, however, "is virtually always ordered once the movant has established that the secret information is relevant and necessary." Id. (quoting Coca-Cola Bottling Co., 107 F.R.D. at 293) (internal ...


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