Opinion

In re Outpatient Medical Center Employee Antitrust Litigation

Court: District Court, N.D. Illinois
Filed: Jun 26, 2023
Cited by: 0 cases
Authority: More cited than 21.1%

“On the issue of control, ‘the test is whether the party has a legal right to obtain [the evidence].’”

How later courts described this case

“On the issue of control, ‘the test is whether the party has a legal right to obtain [the evidence].’”
discussing the effects of cold calling on compensation in a similar antitrust case alleging no poach agreements
“Selecting search terms and data custodians should be a matter of cooperation and transparency among parties.”
“A specific showing of burden is commonly required by district judges faced with objections to the scope of discovery.”

Written by the judges who cited it.

The opinion

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

IN RE OUTPATIENT MEDICAL CENTER Master Docket No. 21 C 305

E MPLOYEE ANTITRUST LITIGATION

Magistrate Judge Sunil R. Harjani

MEMORANDUM OPINION AND ORDER

Plaintiffs Scott Keech and Allen Spradling, former senior employees of Defendants

Surgical Care Affiliates, LLC and SCAI Holdings, LLC (together, “SCA”), bring this antitrust

action alleging violation of Section 1 of the Sherman Act, 15 U.S. § 1. The Consolidated Amended

Class Action Complaint (“Complaint”) [57] alleges that Defendant SCA, along with Defendants

United Surgical Partners International, Inc. and United Surgical Partners Holding Company, Inc.

(together, “USPI”), DaVita, Inc., Doe 1 and other Doe Defendants who operate or operated

ambulatory surgery centers, outpatient medical centers, and other healthcare services, joined a

conspiracy to reduce and limit compensation and mobility of their employees. On January 5, 2021,

a federal grand jury in the Northern District of Texas returned an indictment against SCA with two

counts of conspiring to restrain trade in violation of Section 1 of the Sherman Act. On July 14,

2021, a federal grand jury in the District of Colorado returned an indictment charging DaVita Inc.

and its CEO, Kent Thiry, with two counts of conspiring to restrain trade in violation of Section 1

of the Sherman Act. On November 3, 2021, the Colorado grand jury returned a superseding

indictment adding a third count. Both the DaVita indictment and the SCA indictment charge a

conspiracy between DaVita and SCA not to solicit each other’s senior-level employees. Doc. 233

at 2. The DaVita case proceeded to trial, and DaVita and Thiry were acquitted. United States v.

DaVita Inc., et al., No. 21 CR 229 (D. Colo.). The SCA trial has been continued and the parties

are waiting for the Texas court to set a new trial date. United States v. Surgical Care Affiliates,

LLC, et al., 21 CR 11 (N.D. Tex.).

In February 2023, this case was referred to the undersigned magistrate judge for discovery

supervision. In an effort to resolve the many pending discovery disputes between the parties that

have prolonged this litigation, the Court set a deadline for the parties to meet and confer and then

file motions to compel on all pending written and document discovery disputes. Fact witness

deposition discovery is stayed until further order of the Court. Five motions to compel are now

pending. In this opinion, the Court rules on Plaintiffs’ Motion to Compel Discovery from

Defendant Surgical Care Affiliates, LLC. For the reasons and to the extent set forth below,

Plaintiffs’ Motion to Compel [217, 218] is granted in part and denied in part.

DISCUSSION

Plaintiffs’ current motion relates to their Second Set of Requests for Production of

Documents and seeks to compel eight categories of information relating to: (1) wage-fixing; (2)

the exchange of employment-related business information between SCA and other Defendants;

(3) all employees, rather than just “senior-level” employees; (4) the time period January 23, 2007

through January 1, 2019; (5) documents given to/seized by the United States Department of Justice

(“DOJ”); (6) documents under SCA’s control regardless of whether those documents are also in

its physical possession; (7) documents returned by Plaintiffs’ proposed search terms; and (8)

documents from eleven additional custodians. Under Federal Rule of Civil Procedure 26(b),

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.” Fed. R. Civ. P. 26(b)(1). The factors

relevant to the proportionality inquiry are “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.” Id. A “party claiming that a request is important

to resolve the issues should be able to explain the ways in which the underlying information bears

on the issues as the party understands them.” Fed. R. Civ. P. 26(b)(1) Advisory Committee Notes

(2015 Amendment). At the same time, a “party claiming undue burden or expense ordinarily has

far better information—perhaps the only information—with respect to that part of the

determination.” Id. Finally, when matters are referred to magistrate judges for discovery

supervision, they have “extremely broad discretion in controlling discovery.” Jones v. City of

Elkhart, Ind., 737 F.3d 1107, 1115 (7th Cir. 2013). With these discovery standards in mind, the

Court addresses each disputed category in turn below.

A. Documents Related to Wage-Fixing

Plaintiffs first seek documents related to wage-fixing.1 SAC opposes producing documents

related to wage-fixing, asserting only that the information sought is irrelevant because Plaintiffs’

Complaint does not allege that SCA ever agreed to fix anyone’s wages. To support this contention,

SAC points out that when ruling on Defendants’ joint motion to dismiss, the district court held that

Plaintiffs adequately alleged market allocation agreements, which is a different claim than price

fixing. See In re Outpatient Med. Ctr. Emp. Antitrust Litig., 2022 WL 4465929, at *10 (N.D. Ill.

Sept. 26, 2022). According to SAC, Plaintiffs are therefore only entitled to discovery related to

the market allocation agreements they have alleged.

SAC is correct that discovery need not be produced if it is not relevant to a claim or defense

alleged in the case. See Fed. R. Civ. P. 26(b)(1) Advisory Committee Notes (2000 Amendment)

(explaining that the 2000 amendment “signals to the parties that they have no entitlement to

1 This issue relates to Plaintiffs’ Request Nos. 4-8, 10, 13, and 54.

discovery to develop new claims or defenses that are not already identified in the pleadings.”).

However, a review of the Complaint demonstrates that it does allege that Defendants engaged in

wage-fixing.2 The Complaint explicitly alleges that “Defendants directly and through their agents,

engaged in activities to limit competition and fix, raise, maintain, and/or stabilize the compensation

and terms of employment of their employees[.]” Doc. 57, ¶ 16 (emphasis added). Further,

Plaintiffs allege that “Defendants’ conspiracy included concerted action and undertakings with the

purpose and effect of: (a) fixing Plaintiffs’ and the Class’s compensation at artificially low levels;

and (b) eliminating, to a substantial degree, competition among Defendants for employees.” Id. at

¶ 115 (emphasis added); see also id. at ¶ 9 (alleging the conspiracy “was an effective tool to

suppress their employees’ mobility and compensation.”); id. at ¶ 53 (alleging “Defendants joined

a conspiracy to reduce and limit compensation and mobility of their employees.”).3 Based on these

allegations and solely for purposes of the motion to compel, the Court finds that Plaintiffs’

allegations support a theory that Defendants’ conspiracy to suppress competition for employees’

services could include wage-fixing.

The motion to dismiss proceedings also does not help SAC’s position. In the motions to

dismiss, Defendants argued that “Plaintiffs do not allege that Defendants engaged in price fixing,

bid rigging, or market allocation.” Doc. 76 at 10. In response, Plaintiffs focused their briefing on

whether they adequately alleged that the no-poach agreements were unlawful market allocation

2 Plaintiffs also argue that documents already produced in this case suggest wage-fixing, but the

Complaint controls what discovery is relevant and proportional to this case.

3 The Complaint also alleges that the overarching conspiracy to restrict competition for employees’

services by agreeing to refrain from proactively soliciting or hiring each other’s current employees “caused

the artificial suppression of their compensation.” In re Outpatient Med. Ctr. Emp. Antitrust Litig., 2022 WL

4465929, at *3; see also id at *4-6; Doc. 57, ¶ 114 (“Defendants and their co-conspirators agreed to restrict

competition for Class members’ services through refraining from soliciting or hiring each other’s

employees, thereby fixing and suppressing Class members’ compensation.”) (emphasis added).

agreements. Doc. 86 at 18-27. Thus, the briefing and opinion on the motions to dismiss for failure

to state an antitrust conspiracy claim addressed whether Plaintiffs adequately pled market

allocation through non-solicitation agreements. The district court concluded that the Complaint

“plausibly alleged that the non-solicitation agreements are per se unreasonable naked horizontal

market allocation agreements.” In re Outpatient Med. Ctr. Emp. Antitrust Litig., 2022 WL

4465929, at *10. While the opinion made no mention of wage fixing or price fixing, the district

judge did not hold that Plaintiffs’ claim under § 1 of the Sherman Act rests solely on the non-

solicitation agreements. Nor did the district judge address whether the scope of the alleged

conspiracy includes wage-fixing. Consequently, the motion to dismiss opinion does not, one way

or the other, settle the issue of whether the Complaint alleges that wage-fixing was part of the

conspiracy at issue in this case. Because, at the present time, the scope of the alleged conspiracy

includes wage-fixing, the requested documents are relevant to Plaintiffs’ claim arising under

Section 1 of the Sherman Act. Plaintiffs’ motion to compel information related to wage-fixing is

therefore granted.

B. Documents Regarding the Exchange of Employment-Related Information with

Competing Employers

Plaintiffs’ Request No. 54 seeks all documents relating to the exchange of business

information between SCA and any competing employer, including but not limited to information

“exchanged through trade associations or other industry symposia, concerning labor budgets,

wages or planned wage increases, hiring, recruiting, retention, or any other issue related to

labor/personnel.” Doc. 219-1 at 18. SCA argues only that Plaintiffs have not established that this

information is relevant because this is not a wage-fixing case.4 In turn, Plaintiffs assert that the

4 SCA also contends that documents responsive to Request No. 54 are not proportional to the needs

of the case, but SCA’s proportionality objection depends solely on the relevance of the information sought.

requested information is relevant because this case is about a conspiracy among Defendants to

restrict competition for labor. Specifically, Plaintiffs explain that exchanges of employment-

related information go to the nature and scope of the alleged conspiracy, the nature of the

relationships and information exchanges among Defendants, the motive for entering into the

conspiracy, and the impact of the collusion on Defendants’ employees. As discussed above,

Plaintiffs have sufficiently demonstrated that the Complaint’s allegations that Defendants

conspired to reduce and limit employees’ compensation and mobility could include wage-fixing.

As such, the Court concludes that Plaintiffs have demonstrated that their request for exchanges of

employment-related information seeks information relevant to their claim that Defendants engaged

in a conspiracy to restrict competition for labor. Plaintiffs’ motion to compel is granted as to

Request No. 54.

C. Documents Covering All Employees

Plaintiffs next move to compel documents related to all employees, rather than a subset of

“senior level” employees. Request Nos. 3, 11, 16-18, 23, 25, 27, 29-30, and 52-53 broadly seek

documents about recruitment, hiring, retention, compensation, job categories, and the use of third

parties regarding these subjects.5 SCA objects to producing discovery about any employees other

5 Specifically, these document requests seek: (1) All documents regarding any understanding,

agreement, commitment, contract, or proposal between or among the Defendants and any competitor to

restrict former employees’ or contractors’ solicitation or recruitment of current employees or contractors

for work elsewhere (Request No. 3); (2) All agendas, minutes, notes, or memoranda of any meeting of the

board of directors for you or any Co-Conspirators, or any committee thereof relating to how you or any Co-

Conspirators recruit, hire, or retain employees, including how employee compensation is determined

(Request No. 11); (3) All documents, data, or analyses regarding information you obtained in connection

with employee recruiting, hiring, or exit-interviewing, including, without limitation: a. employees’ previous

employers (or educational institution, where applicable); and b. if the employee left to work for another

employer, the identity of that employer, and the reasons why the employee accepted an offer to work with

that employer (Request No. 16); (4) All documents and records regarding recruiting efforts, including both

successful and failed recruiting attempts (Request No. 17); (5) All documents that refer or relate to the

compensation, hiring, recruitment, or retention of employees by you or any competing employer, including

steps you or any CoConspirators took to retain employees, such as increasing employee compensation

(Request No. 18); (6) All documents concerning any method, formula, policy, practice, or calculation you,

than senior-level employees.6 SCA submits that any document requests related to the existence

and scope of the alleged agreement not to hire or solicit should be limited to senior-level

employees. For support, SCA again emphasizes the district court’s motions to dismiss ruling,

which stated that Plaintiffs “allege that the defendant outpatient medical centers entered into an

illegal agreement not to solicit or hire proactively each other’s senior employees, in violation of §

1 of the Sherman Act.” In re Outpatient Med. Ctr. Emp. Antitrust Litig., 2022 WL 4465929, at *1;

see also id., at *10 (“As pleaded, Defendants agreed to divide the market for senior-level outpatient

medical care employees . . . .”). SCA further contends that the search for and production of

documents relating to “all employees” would impose an undue burden on it.

The Court rejects SCA’s arguments. To begin, the district court was not presented with

and did not actually decide the question of whether the Complaint alleges that the no-poach

agreements part of the conspiracy applies to all employees. Thus, it is inappropriate to deny

production of responsive documents regarding all employees based upon language in the district

or any competing employer, used for determining compensation of employees (Request No. 23); (7) All

documents regarding how you or any Co-Conspirators determine, update, monitor, or set baseline

compensation levels (as opposed to negotiated compensation levels) (Request No. 25); (8) All documents

concerning employees’ equity-based compensation, both internal and external (Request No. 27); (9) All

documents concerning how employees negotiate pay increases (Request No. 29); (10) All documents

regarding factors relevant to deciding whether to increase employee pay (Request No. 30); (11) Documents

sufficient to identify all job categories, job families, or job titles for people You employed, or whom You

attempted to employ, since January 1, 2005 (Request No. 52); (12) Documents sufficient to describe the

duties, responsibilities, and pay scales for each job title in which You employed, or attempted to employ,

any person since January 1, 2005, including but not limited to job descriptions and job postings for such

roles (Request No. 53).

6 In addition, Plaintiffs argue that documents relating to “all employees” are relevant to determining

the impact and effect of the challenged conspiracy. The Complaint alleges that Defendants’ no-poach

agreements suppressed the compensation of all employees, not just employees who would have otherwise

received job offers from rival companies in the outpatient medical care center industry. See Doc. 57, ¶¶ 10,

11, 84, 90, 92, 94; In re Outpatient Med. Ctr. Emp. Antitrust Litig., 2022 WL 4465929, at *4-6. On this

issue, SCA has agreed to produced structured employee data, including information about the employees’

compensation, job titles, and hire and termination dates, for all employees because the request implicated

the impact of the alleged agreement.

court’s opinion when the plain language of the Complaint refers to all employees. The Complaint

also makes clear that the no-poach agreements focused on, but were not limited to, senior-level

employees. As the district court’s opinion noted, Plaintiffs “claim that SCA, USPI, DaVita, and

Doe 1 entered into a series of agreements under which they agreed not to solicit or hire each other’s

employees, particularly senior employees, unless the employee had already informed their existing

employer that they were looking for a new job.” In re Outpatient Med. Ctr. Emp. Antitrust Litig.,

2022 WL 4465929, at *1. For example, Paragraph 6 of the Complaint alleges that “[b]eginning

no later than 2010 [], Defendants or their predecessors in interest entered into agreements to avoid

competing for employees, particularly those at the director level or above (“Senior Employees”),

by refraining from soliciting or hiring each other’s employees absent the knowledge and consent

of their existing employees.” Doc. 57, ¶ 6. Likewise, Paragraph 53 of the Complaint states: “In

furtherance of the conspiracy, Defendants, and each of them, entered into no-poach agreements to

eliminate competition between and among themselves for employees, focusing primarily upon but

not limited to Senior Employees.” Id. at ¶ 53; see also id. at ¶ 1 (“The nation’s leading operators

of outpatient medical centers conspired to restrain competition and reduce compensation for their

employees”); id. at ¶ 54 (“Defendants participated in meetings, conversations, and

communications to discuss the solicitation of each other’s employees, and agreed during those

meetings, conversations, and communications not to solicit each other’s employees.”); id. at ¶ 59

(“Defendants refrained from soliciting each other’s employees.”); id. at ¶ 67 (“I’m going to make

sure everyone on my team knows to steer clear of anyone at DVA . . . .”); id. at ¶ 114 (“Specifically,

Defendants and their co-conspirators agreed to restrict competition for Class members’ services

through refraining from soliciting or hiring each other’s employees, thereby fixing and suppressing

Class members’ compensation.”). In short, Plaintiffs’ allegations about Defendants’ agreements

are not limited to senior-level employees.7

SCA also asserts that production of responsive documents relating to “all employees,” as

opposed to only senior-level employees, would impose an undue burden on SCA and be

significantly out of proportion to the needs of the case. In reply, Plaintiffs contend that it is actually

more burdensome to run search terms and then perform a review that removes documents related

to non-senior employees than to run search terms and then produce the documents returned. The

Court finds that SCA’s claim of undue burden is largely unsupported. SCA’s brief states that it

employes a wide variety of people, including receptionists, schedulers, nurses, insurance verifiers,

finance analysts, radiology technicians, sterile processing clerks, at over 320 different facilities

and production of documents related to its entire workforce would be extremely expensive and

unduly burdensome. But SCA’s supporting declaration states only “SCA’s structured data

production includes information regarding 37,118 former and current employees, and 803

(approximately 2.2%) of these employees have a job title of Director or above.” Doc. 240 at 3, ¶

13. SCA does not provide any cost or time specifics or estimate the actual burden involved in

producing the additional documents sought by Plaintiffs. Moreover, SCA does not address any of

the proportionality factors discussed in Rule 26(b)(1). Without greater detail and analysis, SCA’s

showing is insufficient to establish an undue burden and disproportionality based on that burden.

Human Rights Defense Center v. Jeffreys, 2022 WL 4386666, at *3 (N.D. Ill. Sept. 22, 2022); see

also Fed. R. Civ. P. 26(b)(1) Advisory Committee Notes (2015 Amendment) (explaining that the

2015 amendment regarding proportionality was not “intended to permit the opposing party to

7 Indeed, SCA has agreed not to withhold documents based on the senior-level limitation as to

Requests Nos. 4-9, 13, and 54, which seek documents and communications related to the alleged agreement,

recognizing that Plaintiffs are entitled to “test whether any alleged agreement was limited to senior

employees.” Doc. 236 at 6.

refuse discovery simply by making a boilerplate objection that it is not proportional”); Heraeus

Kulzer, GmbH, v. Biomet, Inc., 633 F.3d 591, 598 (7th Cir. 2011) (“A specific showing of burden

is commonly required by district judges faced with objections to the scope of discovery.”).

Accordingly, the Court grants Plaintiffs’ motion to compel production of documents with respect

to “all employees.”

D. Relevant Time Period for Document Searches

The next disputed question involves the relevant time period for SCA’s document

discovery production. Plaintiffs seek documents from SCA from January 23, 2007 to January 1,

2019. Plaintiff assert that their proposed date range is reasonable because: (1) early-dated

documents will likely lead to the discovery of exactly when, how and why the conspiracy was

formed; (2) documents after the date which Defendants claim the conspiracy ended will help

Plaintiffs confirm when and how, if at all, the conspiracy ended; (3) documents from the full time

period requested will help Plaintiffs understand and interpret Defendants’ data production, which

stretch from 2005 through 2022; and (4) pre- and post- conspiracy documents are relevant to

impact and damages, in order to analyze the conspiracy’s effect on employee compensation. In

response, SCA argues that the Complaint alleges that SCA’s involvement in the alleged conspiracy

began in May 2010 and ended in July 2017. SCA acknowledges that “Plaintiffs wish to see

whether any documents may shed light on how the alleged agreement began and ended and what,

if anything, was different before and after the alleged conspiracy.” Doc. 236 at 7. SCA suggests

that a reasonable time frame for document production is January 2010 through July 2018.

Regarding the start date for document discovery, Plaintiffs and SCA agree that a time-

period that pre-dates the beginning of the alleged conspiracy is appropriate. See IsoNova

Technologies LLC v. Ovainnovations, LLC, 2021 WL 7185073, at *1 (N.D. Iowa Oct. 8, 2021)

(“damages in antitrust cases are often calculated by showing the before-and-after effect of a

defendant’s anticompetitive conduct: thus, a plaintiff is entitled to discovery for some period

before the defendant’s anticompetitive conduct allegedly began.”); In re Rail Freight Fuel

Surcharge Antitrust Litig. 2009 WL 10703132, at *1 (D.D.C. July 13, 2009) (in antitrust cases, a

“plaintiff is ordinarily permitted to discover defendant’s activities for a reasonable period of time

antedating the earliest possible date of the actionable wrong.”). Plaintiffs emphasize that the start

date of the alleged conspiracy is uncertain and the Complaint alleges the conspiracy began “no

later than 2010.” Doc. 57, ¶ 6. In the Court’s view, Plaintiffs’ requested start date of January 23,

2007 is too broad, while SCA’s proposed start date of January 2010 is too narrow to provide

Plaintiff with information relevant to when the conspiracy began and the impact of the conspiracy

on employee compensation and damages. While it is true that the Complaint does not provide a

firm start date of the alleged conspiracy, there must be a start date for discovery and the SCA

Indictment and Complaint’s earliest specific factual allegation of a conspiracy start date is May

2010. Id. at ¶ 55 (“The conspiracy began at least as early as May 2010” with SCA and USPI); id.

at ¶ 2 (SCA Indictment alleges that “by May 2010,” SCA and USPI agreed with one another not

to solicit or hire the other company’s employees without the consent of their current employer.).

The Court finds that the appropriate start date for document discovery in this case is May 1, 2008,

two years prior to the earliest specific start date alleged in the Complaint. This is in line with the

temporal scope of discovery in other antitrust litigation. See Jones v. ACE Cheer Co. LLC, 2022

WL 969720, at *3 (W.D. Tenn. Mar. 30, 2022) (holding plaintiffs’ proposed almost three year

time period for discovery responsive to a third-party subpoena was too broad but allowing

plaintiffs “almost two years of data before the alleged harmed occurred,” which was the same time

period agreed to for party discovery); IsoNova Tech. LLC, 2021 WL 7185073, at *2 (“two years

prior to the complaint’s allegation of the monopoly’s beginning [] provides a sufficient before-

and-after period for the calculation of damages.”); Kleen Products LLC v. Packaging Corp. of

America, 2013 WL 120240, at *8-9 (N.D. Ill. 2013) (ordering production of conduct documents

dating back to January 1, 2003 where plaintiffs alleged in their complaint that price-fixing began

in 2005); In re Rail Freight Fuel Surcharge Antitrust Litig., 2009 WL 10703132, at *1-3 (parties

agreed generally to discovery beginning two years and two months before the alleged class period

commenced on July 1, 2003 but the court granted a limited exception for discovery back to 2000

for evidence related to whether rate increases in 2003 were aberrational or part of a “historic

continuum” as defendants argued in their motion to dismiss). Moreover, SCA has not raised a

burden objection to Plaintiffs’ requested start date of January 23, 2007. Under these

circumstances, a start date of May 1, 2008 will likely provide sufficient information for Plaintiffs

to determine when the purported conspiracy was initiated and to compare the competitive

conditions when the conspiracy was and was not in effect.

As to the end date for SCA’s document discovery, Plaintiffs want SCA to produce

responsive documents through January 1, 2019. For its part, SCA states that its involvement in

the purported conspiracy ended in July 2017. SCA suggests that July 2018, one year beyond the

alleged end date of its involvement, is a reasonable period of time for its document discovery.

Although SCA states that its involvement in the alleged conspiracy terminated in July 2017, that

statement is counter to Plaintiffs’ allegation that Defendants’ no-poach agreements “continued

through at least 2017.” Doc. 57, ¶ 6 (emphasis added).8 But even if the conspiracy had terminated

by December 31, 2017, SCA’s proposed end date of July 2018 is too limiting to understand the

8 See also Doc. 57, ¶ 7 (stating that the DaVita Indictment alleges that “beginning at least as early as

February 2012 and continuing at least as late as July 2017, DaVita and Thiry entered into a conspiracy

with Defendant SCA to suppress competition between them for the services of senior-level employees by

agreeing not to solicit each other’s senior-level employees) (emphasis added).

impact of the conspiracy as well as to determine the amount of damages the employees suffered.

The Court finds Plaintiffs’ proposed end date of January 1, 2019 is reasonable, and SCA does not

argue that it would be overly burdensome to produce responsive documents through January 1,

2019.

Accordingly, Plaintiffs’ motion to compel is granted with respect to their request for SCA

to produce documents from May 1, 2008 to January 1, 2019 and denied in its remainder.

E. Documents Provided to the Department of Justice

Plaintiffs’ Request Nos. 1 and 2 seek the documents SCA produced to the DOJ in

connection with the DOJ’s criminal actions against SCA and DaVita. According to SCA, its DOJ

production consisted of 519,204 documents, amounting to 2,223,958 pages. SCA argues that the

factual allegations, parties, and scope of the grand jury investigation, and therefore the documents

SCA produced to the DOJ, differ from and are broader than Plaintiffs’ claims in this case.

Specifically, SCA points out that the DOJ’s production in the DaVita criminal case involved

materials related to uncharged conduct, a separate charged conspiracy, and impeachment materials

not relevant to and not alleged in the Complaint. See Doc. 233 at 7. SCA does not dispute that

some of the documents Plaintiffs seek are relevant. Rather, SCA objects that many of the

documents in its DOJ production are irrelevant to this case and it would be unduly burdensome to

review all 519,204 documents it produced to determine relevance. By way of example, SCA found

that many of the documents it produced to the DOJ do not hit on the search terms and custodians

currently being negotiated by the parties. From this, SCA argues that the wholesale request for

production of all of the DOJ documents encompasses material not relevant to the claims and

defenses in this case.

Plaintiffs counter that their allegations in this case are broader than the DOJ’s investigation,

both in terms of the scope of the alleged conspiracy and the elements of Plaintiffs’ claims that

include common impact and damages to employees, which they claim are issues the DOJ generally

does not investigate in any detail. Doc. 260 at 6. According to Plaintiffs, the DOJ’s investigation

relates to the same misconduct: the DOJ’s criminal investigation and Plaintiffs’ Complaint both

concern Defendants’ no-poach agreements and Plaintiffs allege these agreements were part of the

same conspiracy. Id. at 6-7.

The Court finds that Plaintiffs’ request for all documents SCA produced to the DOJ in the

criminal actions is “facially overbroad.” In re Broiler Chicken Antitrust Litig., 2020 WL 1046784,

at *2 (N.D. Ill. Mar. 4, 2020) (Durkin, J.). Courts in this district disfavor “cloned discovery”

requests seeking all documents produced or received during other litigation or investigations. Id.

(“[R]eflexive production of documents previously provided to governmental entities is not

appropriate. Rather, documents are discoverable only if they are relevant to a claim or defense in

the case.” (internal quotation marks omitted)); Forth v. Walgreen Co., 2019 WL 10255628, at *4

(July 20, 2019) (denying plaintiffs’ motion to compel all documents defendant produced to the

government in a seven-year qui tam action) (Finnegan, M.J.); Oseman-Dean v. Ill. State Police,

2011 WL 6338834, at *8-9 (N.D. Ill. Dec. 19, 2011) (Brown, M.J.) (“The court agrees with

defendants that [requests for documents defendant “sent to any government agency” about sex or

gender discrimination or retaliation complaints] are far too broad and overly burdensome,

individually and collectively, in relationship to the narrow nature of plaintiff’s claims here.”);

Perius v. Abbott Labs., 2008 WL 3889942, at *5 (N.D. Ill. Aug. 20, 2008) (Brown, M.J.) (granting

motion for protective order as to “generalized discovery regarding the DOJ and [internal]

investigations” as not relevant to any claims or defenses and noting that “t[o] the extent such

evidence would have any ‘tangential’ relevance,” proportionality concerns outweigh permitting

such discovery); see also Moore v. Morgan Stanley & Co., Inc., 2008 WL 4681942, *2, *5 (N.D.

Ill. May 30, 2008) (Keys, M.J.) (holding that “[a] party's requested discovery must be tied to the

particular claims at issue in the case” and that “just because the information was produced in

another lawsuit . . . does not mean that it should be produced in this lawsuit”); In re Sulfuric Acid

Antitrust Litig., 2004 WL 769376, at *6 (N.D. Ill. Apr. 9, 2004) (Schenkier, M.J.) (denying motion

to compel production of “[a]ll documents provided to, or received from, any government agency”

under Federal Criminal Rule of Procedure 6(e) and noting that “one might wonder how the

plaintiffs would show a need for a general request for everything given to the Government, when

they have served at least 65 other (presumably) tailored requests seeking information relevant to

the claims and defenses in the case.”).9

9 Other courts outside this district and this circuit have reached the same conclusion. Humana Inc. v.

Teva Pharms. USA, Inc., 2021 WL 8651837, at *1 (M.D. Fla. Oct. 19, 2021) (“Generally, cloned discovery

has not been compelled, even absent a showing of undue burden, unless the requesting party shows that all

the cloned discovery is relevant.”); Stellato v. Medtronic Minimed, Inc., 2021 WL 3134685, at *2–3 (M.D.

Fla. Feb. 2, 2021) (plaintiff’s request for “much of (if not all)” discovery from another case “arguably

captures a host of documents that would have little to no relevance to this case” and the “argument that all

discovery is relevant because two cases are ‘substantially similar’ is simply not enough.); Midwest Gas

Servs., Inc. v. Ind. Gas Co., 2000 WL 760700, at *1 (S.D. Ind. Mar. 7, 2000) (in antitrust case, denying

motion to compel production of “any and all documents [the defendant] received from or provided to the

United States Justice Department from 1995 to the present.”); TravelPass Grp., LLC v. Caesars Ent. Corp.,

2020 WL 698538, at *6 (E.D. Tex. Jan. 16, 2020) (“Defendants are not entitled to the wholesale

reproduction of all of the FTC Documents and Expedia Documents simply because there may be overlap

between the issues in those cases and those in this case.”); Goro v. Flowers Foods, Inc., 2019 WL 6252499,

at *18 (S.D. Cal. Nov. 22, 2019) (“Asking for all documents produced in another matter is not generally

proper.”); Arrowpac Inc. v. Sea Star Line, LLC, 2014 WL 12618327, at *2 (M.D. Fla. Jan. 31, 2014)

(finding that “[p]laintiffs have not shown that all of the DOJ materials are relevant” and “[d]efendants

should not be required to produce irrelevant documents regardless of any lack of burden to them”); King

Cty. v. Merrill Lynch & Co., 2011 WL 3438491, at *3 (W.D. Wash. Aug. 5, 2011) (“Although some portion

of documents encompassed by Plaintiffs' request may be relevant, the Court has no method of determining

which of those documents are relevant, and which are not. It may very well be that each and every document

produced in the government investigations is relevant to Plaintiff's claims. However, Plaintiff must make

proper discovery requests, identifying the specific categories of documents sought, in order to obtain

them—and each category must be relevant to its claims and defenses.”); Wollam v. Wright Med. Grp., Inc.,

2011 WL 1899774, at *1-2 (D. Colo. May 18, 2011) (“cloned discovery is not necessarily relevant and

discoverable.”).

As explained in another case in this Circuit, “‘[c]loned discovery’ requesting all documents

produced or received during other litigation or investigations, is irrelevant and immaterial unless

the fact that particular documents were produced or received by a party is relevant to the subject

matter of the instant case.” Midwest Gas Servs., Inc, 2000 WL 760700, at *1. Indeed, “[t]here

could be a number of reasons why documents appropriately requested and provided in another

case—even if the subject of those cases seem to overlap—would be irrelevant or burdensome to

produce in another case.” Goro, 2019 WL 6252499, at *18. Thus, a party seeking documents

produced in another matter ordinarily must “do their own work and request the information they

seek directly” and “must make proper requests describing the information in which they are

interested.” Midwest Gas, 2000 WL 760700 at *1.

In contrast, other courts have allowed cloned discovery where the previous litigation or

investigation and the present case had “significant factual and legal overlap, with both suits

asserting claims under the same [] statute.” Schneider v. Chipotle Mexican Grill, Inc., 2017 WL

1101799, at *4 (N.D. Cal. March 24, 2017); Rumble, Inc. v. Google LLC, 2023 WL 3751797, at

*7-8 (N.D. Cal. May 31, 2023) (granting plaintiff’s motion to compel defendant to produce: (1)

documents it produced to the DOJ and state Attorneys General because those investigations’

allegations had “significant factual and legal overlap” with the allegations made by plaintiff in its

antitrust claim and (2) documents produced to a congressional antitrust subcommittee because its

“requests and the contents of the Congressional Report tracked similar allegations by plaintiff and

[were] relevant to its antitrust claim”); Costa v. Wright Med. Tech., Inc., 2019 WL 108884, at *1–

2 (D. Mass. Jan. 4, 2019) (in products liability action, compelling production of cloned discovery

from one other case which was “substantially similar because both involve claims stemming from

fractures” of the same allegedly defective hip implant component); Town of Westport v. Monsanto

Co., 2015 WL 13685105, at *3 (D. Mass. Nov. 5, 2015) (“Materials produced and deposition

testimony given in other litigation is generally discoverable upon a showing of substantial

similarity between the prior and current actions.”); see also In re Plastics Additives Antitrust

Litigation, 2004 WL 2743591, at *12-13 (E.D. Pa. Nov. 29, 2004) (noting “defendants in antitrust

litigation regularly agree through joint discovery schedules to produce documents submitted to the

DOJ, grand juries, and other investigatory authorities concerning the basis for the antitrust civil

suit” and citing “several cases in which defendants have been compelled to produce documents

relating to government investigations.”).

Ultimately, “the appropriateness of cloned discovery depends upon the circumstances” of

each case. Forth, 2019 WL 10255628, at *7. Plaintiffs’ request for all documents SCA produced

to the DOJ in the criminal actions arguably captures documents that could have no relevance to

this case, including materials related to uncharged conduct, a separate charged conspiracy, and

certain impeachment materials. Accordingly, on the current record, the Court cannot conclude

that all documents SCA produced to the DOJ are relevant to a party’s claim or defense in this

lawsuit. Moreover, Plaintiffs do not contend that the fact that SCA produced documents to the

DOJ is relevant to their claim. As a result, Plaintiffs “must make proper requests describing the

information in which they are interested” in the SCA production to the DOJ. Id., at *4 (quoting

Midwest Gas Servs Inc., 2000 WL 760700, at *1). Here, Plaintiffs’ Second Set of Requests for

Production of Documents contains 54 separate document requests. In response, SCA has agreed

to produce any documents produced to the DOJ in the SCA criminal case that hit upon the parties’

agreed search terms and custodians. Doc. 236 at 8-9. SCA also represents it will not withhold any

documents on the basis that they were produced to DOJ in the SCA criminal case. Id. at 8.

Plaintiffs do not address or explain why this is not sufficient to give them relevant information in

proportion to the needs of the case. See Cap. Ventures Intern. v. J.P. Morgan Mortg. Acquisition

Corp., 2014 WL 1431124, at *2 (D. Mass. Apr. 14, 2014) (“Defendants have offered to run agreed-

upon search terms over their productions to the SEC and New York Attorney General, which

should be sufficient to capture materials relevant to the issues in this case. Beyond that

arrangement, plaintiff's request for all documents produced in other actions and investigations is

denied.”). While it is likely that a large portion of documents SCA provided to the DOJ are

relevant, Plaintiffs have not established the relevance of all documents and thus, the Court need

not reach SCA’s burden argument. Forth, 2019 WL 10255628, at *6 (“Without the predicate

showing of relevancy, there is no need for this Court to undertake a balancing of benefit and

burden, including an assessment of proportionality.”).

F. Documents Under SCA’s Legal Control

Plaintiffs next request that the Court order SCA to comply with Federal Rule of Civil

Procedure 34(a)(1) and produce documents within its legal control. See Fed. R. Civ. P. 34(a)(1)

(allowing a party to request documents within the responding party’s “possession, custody, or

control[.]”). In its briefing, SCA does not dispute that it will comply with Rule 34(a)(1) by

producing documents under its legal control. SCA represents that “it is not aware of and has not

identified any responsive documents related to third parties within its legal control that it is

currently withholding from Plaintiffs.” Doc. 236 at 9. SCA also states that it will comply with its

obligation under the Federal Rules if it discovers third-party documents over which it has legal

control. Id. at 11. Given SCA’s representations, the Court assumes this dispute is resolved and

Plaintiffs’ motion to compel is denied as moot regarding documents under SCA’s legal control.

SCA is expected to produce responsive third-party documents over which it has legal control. See

Thermal Design, Inc. v. Am. Soc’y of Heating, Refrig. & Air-Cond. Eng’rs., Inc., 755 F.3d 832,

839 (7th Cir. 2014) (quoting Dexia Credit Local v. Rogan, 231 F.R.D. 538, 542 (N.D. Ill. 2004)

(“On the issue of control, ‘the test is whether the party has a legal right to obtain [the evidence].’”)).

G. Documents Returned by Plaintiffs’ Proposed Search Terms and Custodians

Finally, the parties disagree over the appropriate search terms and custodians for SCA’s

search of its electronically stored information (“ESI”), with Plaintiffs proposing 137 search terms

and SCA proposing 32 search terms. The parties have agreed to twelve custodians, and Plaintiffs

seek to add eleven additional custodians, which SCA contends is not proportional to the needs of

the case.

Plaintiffs have made a predicate showing that the information they seek is relevant to this

litigation. Specifically, Plaintiffs’ charts describe the relevance and non-duplicative nature of their

proposed search terms. Docs. 219-19, 267-2. In support of its contentions, SCA submitted a chart

with its objections and proposed modifications to Plaintiffs’ proposed search terms. Doc. 240-1.

However, except as noted in the next paragraph, SCA failed to provide any explanation or support

for its objections, merely stating in conclusory fashion: (1) “anchor needed because Plaintiffs’

search term is untethered to allegations in complaint” or (2) “Plaintiffs’ search term is cumulative

and duplicative.” Below are illustrative examples from Plaintiffs’ reply chart of search terms:

Plaintiffs’ Proposed Search Term No. 8: Withdraw* w/2 offer

Rationale: The co-conspirators discussed “withdrawing” offers to employers of

competitors to enforce the no-poach agreements. Chan Decl. Ex. 12 at 130:2-22;

id. Ex. 13 at 479:10-480:6.

SCA’s Modification to Plaintiffs’ Search Term: (withdraw* or abandon* or

terminat* or discontin*) w/10 (DaVita or DVA or “united surgical” or USPI or

Tenet)

Defendant’s Response: Search Term is Untethered to Allegations in Complaint

Plaintiffs’ Reply: No Defendant anchor and no burden. This term should not be

anchored by specific reference to Defendants because (1) conspiracy documents

may not explicitly name the Defendants and (2) the complaint alleges that the

conspiracy involved co-conspirators who were not named as defendants.

Additionally, because the conspiracy was secret, it is less likely they would have

referred to their co-conspirators by name. Moreover, SCA has failed to substantiate

the burden by providing the hit counts associated with both Plaintiffs’ search term

and their modification.

Plaintiffs’ Proposed Search Term No. 9: “cold call*” OR “cold-call* OR

coldcall*

Rationale: Cold calls are a mechanism by which the co-conspirators’ recruiters

reach out to potential candidates for employment. Chan Decl. Ex. 12 at 64:9-10.

See also Nitsch v. Dreamworks Animation SKG Inc., 315 F.R.D. 270, 300 (N.D.

Cal. 2016) (discussing the effects of cold calling on compensation in a similar

antitrust case alleging no poach agreements). This term should not have an anchor

to Defendant entity terms because an anchor will not capture all instances relevant

to Plaintiffs’ allegations.

SCA’s Modification to Plaintiffs’ Search Term: “cold call*” OR cold-call* OR

coldcall* w/20 (DaVita or USPI)