“A complaint guides the parties’ discovery….”
How later courts described this case
- “A complaint guides the parties’ discovery….”
Written by the judges who cited it.
The opinion
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8 UNITED STATES DISTRICT COURT
9 SOUTHERN DISTRICT OF CALIFORNIA
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11 MEDIMPACT HEALTHCARE Case No.: 19-cv-1865-GPC-DEB
SYSTEMS, INC., et al.,
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ORDER ON JOINT MOTION FOR
Plaintiffs,
13 DETERMINATION OF DISCOVERY
v. DISPUTE AND GRANTING
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MOTION TO SEAL DOCUMENTS
IQVIA INC., et al.,
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Defendants. [DKT. NOS. 317, 319]
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I. INTRODUCTION
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Before the Court is the parties’ Joint Motion for Determination of Discovery
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Dispute. Dkt. No. 319.1 The dispute concerns Plaintiffs’ Request for Production of
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23 1 This dispute implicates Plaintiffs’ Request for Production to:
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• IQVIA AG, Set Five, RFP Nos. 194–96;
25 • IQVIA Ltd., Set Five, RFP Nos. 193–95;
• IQVIA Inc., Set Four, RFP Nos. 184–86;
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• Dr. Ghosheh, Set Three, RFP Nos. 128–30; and
27 • Mr. Sadana, Set Three, RFP Nos. 131–33.
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1 Documents (“RFP”) relating to three of Defendants’ products: (1) Checks for Drugs and
2 Services (“CDS”); (2) Code Checks Engine (“CCE”); and (3) Code Checks Management
3 (“CCM”) (collectively “Disputed Products”). Id. at 4.2 Plaintiffs contend the Disputed
4 Products are relevant to their fiduciary duty, RICO, and conspiracy claims because they
5 “compete directly with [Plaintiffs’] Pharmacy Benefit Management (“PBM”) platform and
6 provide PBM functionality.” Id. at 4. Defendants argue the Disputed Products are irrelevant
7 because they are not PBM technology. Id. at 8.
8 For the reasons set forth below, the Court GRANTS Plaintiffs’ request to compel
9 discovery on the Disputed Products.
10 II. LEGAL STANDARD
11 “[B]road discretion is vested in the trial court to permit or deny discovery . . . .”
12 Hallett v. Morgan, 296 F.3d 732, 751 (9th Cir. 2002) (quoting Goehring v. Brophy, 94 F.3d
13 1294, 1305 (9th Cir. 1996)). “Parties may obtain discovery regarding any non-privileged
14 matter that is relevant to any party’s claim or defense and proportional to the needs of the
15 case.” Fed. R. Civ. P. 26(b)(1). Even after the 2015 Amendments to Rule 26, “discovery
16 relevance remains a broad concept.” Fed. Nat’l Mortg. Ass’n v. SFR Invs. Pool 1, LLC,
17 No.14-cv-02046-JAD-PAL, 2016 WL 778368, at *2 n.16 (D. Nev. Feb. 25, 2016); see also
18 Odyssey Wireless, Inc. v. Samsung Elecs. Co., Ltd., No. 15-cv-01735-H-RBB, 2016 WL
19 7665898, at *2 (S.D. Cal. Sept. 20, 2016) (“Relevance is construed broadly to include any
20 matter that bears on, or reasonably could lead to other matters that could bear on, any issue
21 that may be in the case.”) (citing Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 350–
22 51 (1978)).
23 The party seeking to compel discovery has the burden of establishing its request
24 satisfies the relevancy requirements of Rule 26(b)(1). Soto v. City of Concord, 162 F.R.D.
25 603, 610 (N.D. Cal. July 17, 1995). This “is a relatively low bar.” Cont’l Circuits LLC v.
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2 When referencing page numbers for documents filed with the Court, the Court’s citation
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1 Intel Corp., 435 F. Supp. 3d 1014, 1018 (D. Ariz. 2020). “[T]he party opposing discovery
2 bears the burden of showing that discovery should not be allowed, and of clarifying,
3 explaining, and supporting its objections with competent evidence.” Medicinova Inc. v.
4 Genzyme Corp., No. 14-cv-2513-L-KSC, 2017 WL 2829691, at *4 (S.D. Cal.
5 June 29, 2017) (quoting Lofton v. Verizon Wireless (VAW) LLC, 308 F.R.D. 276, 281 (N.D.
6 Cal. 2015)).
7 III. DISCUSSION
8 The discovery requests at issue seek comparisons of the three Disputed Products,
9 which Plaintiffs argue are “directly relevant to [Plaintiffs’] fiduciary duty, RICO, and
10 conspiracy claims and proportional to the needs of the case.” Dkt. No. 319 at 4. Regarding
11 the Disputed Products, Plaintiffs claim an arbitration tribunal enjoined “any offer or sale
12 of CDS because it competes with [Plaintiffs’] PBM.” Id. Plaintiffs also claim Defendants
13 renamed CDS to CCE two months after the injunction, and Defendants have also referred
14 to CDS as CCM. Id. at 6.3
15 Defendants respond that discovery is limited to PBM technology and claims data,
16 and CDS “is not itself a PBM technology.” Id. at 8 (emphasis in original). Defendants also
17 argue CDS and related products are irrelevant because: (1) Plaintiffs’ unfair competition
18 and tortious interference claims were dismissed; (2) there is “no such thing as a RICO-
19 based ‘conspiracy to compete’ claim for violation of a contractual commitment”; and
20 (3) Plaintiffs do not “specifically allege[ ] anything about CDS amounting to a ‘breach of
21 fiduciary duty.’” Id. at 10.
22 The Court finds the discovery at issue clears the “relatively low bar” of relevance.
23 Cont’l Circuits, 435 F. Supp. 3d at 1018. Plaintiffs’ First Amended Complaint (“FAC”)
24 alleges the individually named Defendants (in their capacities as Board of Directors of
25 MedImpact Arabia (“MIA”) and as shareholders) violated their fiduciary obligations “by
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3 These claims are supported by Exhibits 5 and 6 attached to the Declaration of Jennifer D.
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1 marketing Dimensions’ competing products in competition against MIA’s PBM platform
2 to MIA’s existing clients.” Dkt. No. 93 ¶¶ 57, 109. Plaintiffs’ FAC specifically alleges
3 Defendants “hoped to switch [Plaintiffs’ clients] away from MIA’s PBM to AIMS and
4 another Dimensions product, CDS. . . .” Id. ¶ 65. These allegations establish the relevance
5 of the discovery Plaintiffs seek. See Coleman v. Quaker Oats Co., 232 F.3d 1271, 1292
6 (9th Cir. 2000) (“A complaint guides the parties’ discovery….”).
7 Although Defendants argue CDS “is not itself a PBM technology,” Dkt. No. 319 at 8
8 (emphasis in original), Plaintiffs contend “CDS, CCE, and CCM compete with
9 MedImpact’s PBM and provide PBM functionality.” Id. at 4. Both parties support their
10 positions with evidence. See, e.g., Declaration of Heather Bates (Dkt. No. 319-1) and
11 Declaration of Dr. Robert P. Navarro (Dkt. No. 319-2). The Court will not resolve or
12 attempt to reconcile this factual dispute on a discovery motion. See Fosbre v. Las Vegas
13 Sands Corp., No. 10-cv-00765-APG-GWF, 2016 WL 54202, at *5 (D. Nev. Jan. 5, 2016)
14 (“[T]o obtain [certain] discovery, . . . Plaintiffs are not required to prove, and the Court is
15 not required to find, that their claims are valid. That is a matter to be determined based on
16 admissible evidence presented at trial or on motion for summary judgment.”). The
17 allegations in Plaintiffs’ FAC and the evidence Plaintiffs submit with this Motion are more
18 than sufficient to establish the relevance of the discovery Plaintiffs’ seek. See Soto v. City
19 of Concord, 126 F.R.D. at 610 (“[T]he question of relevancy should be construed liberally
20 and with common sense and discovery should be allowed unless the information sought
21 has no conceivable bearing on the case.”) (internal quotation omitted).
22 IV. MOTIONS TO SEAL
23 Plaintiffs filed a Motion to Seal Documents in Support of Joint Motion for
24 Determination of Discovery Dispute. Dkt. No. 317. Plaintiffs request the Court seal the
25 documents lodged at Dkt. No. 318 (Joint Motion for Determination of Discovery Dispute
26 and exhibits provided in support of the Joint Motion) because these documents implicate
27 Defendants’ “confidential and sensitive business information” and contain Defendants’
28 operations, strategies to obtain new clients, and “confidential projects, products and deal
1 ||/terms.” Jd. at 2-3. The parties filed a redacted pleading that omits the information in
2 || question. Dkt. No. 263. Good cause appearing, the Court GRANTS the Motion to Seal and
3 || directs the Clerk of Court to file the documents lodged at Dkt. No. 318 under seal. See
4 || Kamakana v. City & Cnty. of Honolulu, 447 F.3d 1172, 1180 (th Cir. 2006) (“[A]
5 || particularized showing under the ‘good cause’ standard of Rule 26(c) will suffice to
6 || warrant preserving the secrecy of sealed discovery material attached to nondispositive
7 || motions.”’) (internal quotations, citations, and edits omitted).
8 Vv. CONCLUSION
9 Based on the foregoing, Plaintiffs’ request to compel discovery on CDS, CCE, and
10 ||CCM is GRANTED. Defendants must produce responsive documents on or before
11 || October 21, 2021. The documents lodged at Dkt. No. 318 MUST BE FILED UNDER
12 ||SEAL.
13 IT IS SO ORDERED.
14 || Dated: October 7, 2021 —
i Dando
16 Honorable Daniel E. Butcher
United States Magistrate Judge
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