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Coll v. Stryker Corp.

United States District Court, D. New Mexico

July 12, 2017

CLARKE COLL, Plaintiff, [1]
v.
STRYKER CORPORATION and HOWMEDICA OSTEONICS CORPORATION, Defendants.

          MEMORANDUM OPINION AND ORDER DENYING PLAINTIFF'S MOTION TO COMPEL DISCOVERY

          STEPHAN M. VIDMAR UNITED STATES MAGISTRATE JUDGE.

         THIS MATTER is before the Court on Plaintiff's Motion for an Order Compelling Responses to Document Requests [Doc. 154], filed April 27, 2017. Defendants responded on May 19, 2017. [Docs. 159, 160]. Plaintiff replied on June 1, 2017. [Doc. 168]. Having considered the briefing and the relevant law, and being otherwise fully advised in the premises, the Court will DENY Plaintiff's Motion to Compel.

         Background

         In the 1990s, Wayne Augé, II, M.D., (the originally named Plaintiff in this action) made innovative developments in orthopedic medicine and surgery. Defendants were interested in his inventions, and so they entered into a series of agreements with him for their common benefit. Defendants utilized Dr. Augé's inventions in several products that went to market. Over the years, however, as Defendants marketed new products with his inventions, Dr. Augé came to believe that Defendants were not fulfilling their agreements to honor his ownership rights or to pay him what they owed. Consequently, Dr. Augé filed this lawsuit in 2014. He alleges breach of contract and other related claims stemming from Defendants' alleged violation of the parties' agreements. [Doc. 34] at 9-14.

         Plaintiff claims that three lines of medical devices sold by Defendants-the Iconix, VersiTomic, and MicroFX product lines-contain “[i]mprovements over confidential disclosures of proprietary information made by Dr. Augé.” [Doc. 154] at 2. He claims, in part, that he is entitled to “all profits derived from the commercialization” of the “improvements.” Id. (internal quotation marks omitted). In other words, he claims he is entitled to all profits Defendants earned in connection with the commercialization of the new products made with Dr. Augé's inventions. Id. at 2-3.

         Because Plaintiff requests damages in the amount of the profits Defendants earned from the three specified product lines, he has sought discovery of Defendants' revenues and expenses pertaining to those products. Following an earlier request for production, Defendants furnished Plaintiff with spreadsheets and other charts showing their revenues, expenses, and profits from sales of the relevant product lines. See [Doc. 154] at 3; [Doc. 159] at 3-4; see also [Docs. 160-1, 160-2, 160-3]. The spreadsheets provided relevant financial data in summary form; Defendants did not supply itemized lists of each cost and expense deducted in calculating their profits. [Doc. 154] at 3 & n.4. Nor did Defendants provide “documents evidencing actual expenses.” Id. Plaintiff subsequently requested additional documents pertaining to Defendants' financials.

         Plaintiff requested the following:

Documents, including invoices or other source documents that show or support all items of expense you incurred in the design, manufacturing, marketing and sales, including sales commissions, of each of the product lines Iconix, VersiTomic and MicroFX that are included in amounts deducted from revenues in calculating profits from the sale of devices in those product lines, as reflected in documents you have marked or otherwise produced . . . .

[Doc. 154-1] at 2. Defendants objected to the request for production, and Plaintiff filed the instant motion to compel.

         Plaintiff claims he is entitled to discovery of the underlying source documents from which Defendants calculated the expenses they incurred and compiled the financial summaries of revenues and expenses already provided to Plaintiff. He contends that without these documents, he will be forced to “accept, unquestioned, Defendants' representation as to the cumulative figures for expenses they would claim to be entitled to deduct from revenues in order to calculate their profits.” [Doc. 154] at 3. He argues that these source documents are not easily obtained elsewhere. Id. at 5. Given that Defendants' profits are the central damages issue in the case, Plaintiff contends that he is entitled to the requested documents.

         Defendants argue that the discovery sought is so voluminous that its production would impose an undue burden on them. [Doc. 159] at 4, 8-9; [Doc. 159-4] at 10-11. They also contend that the request is cumulative and that Plaintiff has no need for further financial information, in light of the summary financial data Defendants have already provided. [Doc. 159] at 6, 8. They maintain that the spreadsheets show “expansive financial details” and that the data in the spreadsheets was lifted directly from Defendants' Oracle Enterprise Resource Planning (“ERP”) database. Id. at 5-6, 8. Moreover, Defendants point out that their corporate representatives will be prepared to answer questions during their depositions as to the methodologies Defendants employed in calculating the profits of the product lines in question, determining expenses, and compiling the financial information provided to Plaintiff in summary form. Id. at 3, 12.

         Legal Standard

         Pursuant to Fed.R.Civ.P. 26(b)(1), parties are entitled to discovery “regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case.” Whether requested discovery is proportional depends on “the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit.” Fed.R.Civ.P. 26(b)(1).

         Rule 26 also imposes specific limitations on electronically stored information (“ESI”). “A party need not provide discovery of electronically stored information from sources that the party identifies as not reasonably accessible because of undue burden or cost.” Fed.R.Civ.P. 26(b)(2)(B). On a motion to compel, the party withholding discovery under this provision bears the initial burden of showing that the information sought “is not reasonably accessible because of undue burden or cost.” Id. If such a showing is made, the burden shifts to the requesting party to show good cause. Id. Whether a responding party must produce ESI depends on whether the burdens and costs of production outweigh the potential benefits of the discovery, as well as “whether those burdens and costs can be justified in the circumstances of the case.” Fed.R.Civ.P. 26(b)(2) advisory committee's note to 2006 amendment. In undertaking such an evaluation, courts may consider, among other things, the specificity of the request, the availability of information from other more ...


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