The opinion
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6 UNITED STATES DISTRICT COURT
7 SOUTHERN DISTRICT OF CALIFORNIA
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Case No.: 24CV1014-W(BLM)
9 ORBIAN CORPORATION LIMITED AND
RAGLAN CAPITAL LIMITED,
10 ORDER (1) GRANTING IN PART AND
Plaintiffs, DENYING IN PART PLAINTIFF’S
11 MOTION TO COMPEL DISCOVERY
v. FROM DEFENDANT AND (2)
12
GRANTING IN PART AND DENYING IN
JAMES D. HOUSTON,
13 PART DEFENDANT’S MOTION TO
Defendants. COMPEL
14
15 ____________________________________ [ECF Nos. 39 & 40]
16 AND RELATED COUNTERCLAIMS
17
18 Currently before the Court is Plaintiff Orbian Corporation Limited’s November 7, 2024
19 Motion to Compel Discovery from Defendant [ECF No. 40 (“P MTC”)], Defendant’s November
20 14, 2024 opposition to the motion [ECF No. 41 (D Oppo.”), and Plaintiff’s November 26, 2024
21 Reply [ECF No. 46 (“P Reply”)]. Also before the Court is Defendant’s November 7, 2024 Motion
22 to Compel Production of Documents from Orbian Corporation Limited and Thomas Dunn [ECF
23 No. 39 (“D MTC”)], Plaintiff’s November 14, 2024 opposition to the motion [ECF No. 42 (P
24 Oppo.”), and Defendant’s November 26, 2024 Reply [ECF No. 45 (“D Reply”)]. For the reasons
25 set forth below, Plaintiff’s Motion to Compel Discovery from Defendant is GRANTED IN PART
26 AND DENIED IN PART and Defendant’s Motion to Compel Production of Documents from
27 Orbian Corporation Limited and Thomas Dunn is GRANTED IN PART AND DENIED IN PART.
1 RELEVANT FACTUAL BACKGROUND
2 The instant matter was removed to this Court on June 10, 2024. ECF No. 1. Plaintiffs’
3 complaint alleges damages for Breach of Fiduciary Duty, Faithless Servant, Fraud/Deceit,
4 Fraudulent Inducement/Promissory Fraud, Declaratory Relief Re Participation Agreement, and
5 Breach of Contract, and seeks Declaratory Relief on Grounds of Termination. ECF No. 1-2.
6 Plaintiffs hired Defendant Houston to run their Carlsbad, California office and to act as General
7 Counsel and Chief Legal Officer for the company at large. Id. at 5. Plaintiffs allege that during
8 his tenure, Houston deceived the company, abused his roles, hid conflicts of interest, retained
9 and controlled outside counsel to the detriment of the company, created a culture of fear in the
10 Carlsbad office, harassed employees, violated company policies and procedures, and bullied,
11 berated, and belittled his employees. Id. When Houston’s alleged misdeeds came to light, the
12 company investigated and later terminated Houston based on the findings. Id. at 6. Plaintiffs
13 subsequently discovered that Houston owes them millions of dollars after fraudulently inducing
14 Plaintiffs into an equity participation agreement and borrowing money from Plaintiff Raglan. Id.
15 On June 17, 2024, Defendant Houston filed a countercomplaint against Plaintiffs Orbian
16 and Raglan and Counterdefendant Thomas Dunn for breach of contract, false promise, aiding
17 and abetting a false promise, declaratory relief, and unjust enrichment. ECF No. 2 at 17-21.
18 Houston alleges that he is owed at least $1,800,000.00 due to his constructive termination by
19 Plaintiffs. Id. at 3. In addition, Plaintiffs have failed to pay Houston monies owed under the
20 Restated Participation Agreement and improperly seek to claw back monies loaned to Houston
21 pursuant to the Raglan Loan Agreement. Id. at 4.
22 LEGAL STANDARD
23 Federal Rule Civil Procedure 26
24 The scope of discovery under Federal Rules of Civil Procedure (“Fed. R. Civ. P.”) is defined
25 as follows:
26
Parties may obtain discovery regarding any nonprivileged matter that is relevant
27 to any party’s claim or defense and proportional to the needs of the case,
considering the importance of the issues at stake in the action, the amount in
1 resources, the importance of the discovery in resolving the issues, and whether
the burden or expense of the proposed discovery outweighs its likely benefit.
2 Information within this scope of discovery need not be admissible in evidence to
be discoverable.
3
4 Fed. R. Civ. P. 26(b)(1). Typically, the relevance standard is broad in scope and “encompass[es]
5 any matter that bears on, or that reasonably could lead to other matters that could bear on, any
6 issue that is or may be in a case.” Doherty v. Comenity Capital Bank, 2017 WL 1885677, at *2
7 (S.D. Cal. May 9, 2017). Relevance, however, is not without limits. Id. The 2015 amendment
8 to Rule 26(b) removed the phrase “reasonably calculated to lead to the discovery of admissible
9 evidence” because it was often misconstrued to define the scope of discovery. Fed. R. Civ. P.
10 26(b)(1) advisory committee’s notes (2015 amendment). Instead, to fall within the scope of
11 discovery, the information must also be “proportional to the needs of the case,” requiring lawyers
12 to “size and shape their discovery requests to the requisites of a case” while “eliminat[ing]
13 unnecessary or wasteful discovery.” Fed. Civ. R. P. 26(b)(1); Cancino Castellar v. McAleenan,
14 2020 WL 1332485, at *4 (S.D. Cal Mar. 23, 2020) (quoting Roberts v. Clark Cty. Sch. Dist., 312
15 F.R.D. 594, 603 (D. Nev. 2016)).
16 District courts have broad discretion to determine relevancy for discovery purposes. D.M.
17 v. County of Merced, 2022 WL 229865, at * 2 (E.D. Cal. Jan. 26, 2022) (citing Hallett v. Morgan,
18 296 F.3d 732, 751 (9th Cir. 2002) and Surfvivor Media v. Survivor Prods., 406 F.3d 625, 635
19 (9th Cir. 2005)). District courts also have broad discretion to limit discovery to prevent its abuse.
20 See Fed. R. Civ. P. 26(b)(2)(C) (instructing that courts must limit discovery where the party
21 seeking the discovery “has had ample opportunity to obtain the information by discovery in the
22 action” or where the proposed discovery is “unreasonably cumulative or duplicative,”
23 “obtain[able] from some other source that is more convenient, less burdensome or less
24 expensive,” or where it “is outside the scope permitted by Rule 26(b)(1)”). Further, “[w]hen
25 analyzing the proportionality of a party’s discovery requests, a court should consider the
26 importance of the issues at stake in the action, the amount in controversy, the parties’ relative
27 access to the information, the parties’ resources, the importance of the discovery in resolving
1 benefit. Cancino, 2020 WL 1332485, at *4 (citing Fed. R. Civ. P. 26(b)(1)).
2 Fed. R. Civ. P. 34
3 Fed. Civ. R. P. 34 provides that a party may serve on another a request for production of
4 documents, electronically stored information, or tangible things within the scope of Fed. Civ. R.
5 P. 26(b). Fed. R. Civ. P. 34(a). Where a party fails to produce documents requested under Rule
6 34, the party propounding the request for production of documents may move to compel
7 discovery. See Fed. R. Civ. P. 37(a)(3). “The party seeking to compel discovery has the burden
8 of establishing that its requests satisfy the relevancy requirements of Rule 26(b)(1). Thereafter,
9 the party opposing discovery has the burden of showing that the discovery should be prohibited,
10 and the burden of clarifying, explaining, or supporting its objections.” Williams v. County of San
11 Diego, 2019 WL 2330227, at *3 (citing Bryant v. Ochoa, 2009 WL 1390794, at *1 (S.D. Cal. May
12 14, 2009) (internal quotations omitted).
13 Fed. R. Civ. P. 37
14 If a motion to compel discovery is granted, Rule 37(a)(5) requires a court to order the
15 “party or deponent whose conduct necessitated the motion, the party or attorney advising that
16 conduct, or both to pay the movant’s reasonable expenses incurred in making the motion,
17 including attorney’s fees” unless the movant failed to meet and confer, the objection was
18 substantially justified, or other circumstances militate against awarding expenses. See Brown
19 v. Hain Celestial Group, Inc., 2013 WL 5800566, *5 (N.D. Cal. Oct. 28, 2013) (“[t]he party that
20 loses the motion to compel bears the affirmative burden of demonstrating that its position was
21 substantially justified”) (internal citations omitted). If the motion is granted in part and denied
22 in part, the court “may, after giving an opportunity to be heard, apportion the reasonable
23 expenses for the motion.” Fed. R. Civ. P. 37(a)(5)(C).
24 I. Plaintiffs’ and Counter Defendants’ Motion to Compel Discovery from
25 Defendant Houston
26 Plaintiff Orbian seeks an order from the Court requiring Defendant Houston “to promptly
27 produce documents responsive to Request Nos. 1, 2, 7, 54, and 81.” P MTC at 18. Orbian
1 and communications that are harmful to his claims and defenses.” Id. at 4-8.
2 Houston contends that he “complied with, or will comply with, all of the proper discovery
3 requests, and objects where legally appropriate on the bases of privilege, privacy, and
4 relevance.” D Oppo. at 4.
5 Request for Production Nos. 1 and 2
6 RFP No. 1 seeks “[a]ll documents and information stored on the Laptop or the Phone at any
7 time.” Declaration of Michael Petrella In Support of Motion to Compel Discovery From Defendant
8 (“Petrella Decl.”) at Exhibits A and B. Houston responded to RFP No. 1 as follows:
9 Objection. The request is overly broad and not proportionate to the needs of
the case. The information sought is irrelevant. The information sought is equally
10
available to and in the possession of the propounding party. The request is
11 overly broad and invasive of Houston’s privacy, as it seeks information personal
to Houston and unrelated to Orbian or the claims contained in this suit. Subject
12 to and without waiving the foregoing [sic]. Subject to and without waiving the
foregoing, Houston will conduct a diligent search and reasonable inquiry and
13
produce all non-privileged documents in his possession, custody, or control.
14
15 Petrella Decl. at Exhibit B. RFP No. 2 seeks “[a]ll documents and information removed from the
16 Phone or the Laptop at any time.” Petrella Decl. at Exhibit B. Houston responded to RFP No. 2
17 as follows: “Objection. This request is completely subsumed by request for production No. 1.
18 Houston hereby incorporates the answer to Request for Production No. 1 as though fully set
19 forth here.” Id.
20 Orbian argues that Houston’s response improperly gives Houston the ability to determine
21 which documents are Plaintiff’s property and which documents he can keep as “personal
22 property.” P MTC at 9-10. Orbian further argues that the requests are seeking information that
23 is relevant to all of Orbian’s claims, especially the claim seeking a declaration for grounds for
24 termination. Id. at 10. Orbian argues that Houston’s July 2023 phone calls to Tech2U, a data
25 destruction company, during which Houston stated that his “job is on the line” and that if Orbian
26 recovers anything from the laptop he would be fired, support the relevance and importance of
27 the information being sought. Id. at 7, 10. Orbian notes that it agreed to limit the requests to
1 to Orbian on August 8, 2023 and September 7, 2023, respectively.” Id. at fn 1. Orbian further
2 notes that the request is not overbroad or disproportionate, the documents are not equally
3 available to Orbian, and that the items sought do not violate Houston’s privacy interests as they
4 are all property of Orbian. Id. at 11-13.
5 Defendant contends that he “has already complied with this request to its legally
6 permissible bounds” and “produced all relevant information.” D Oppo. at 4. Houston states
7 that he returned the laptop and cell phone at issue with all data wiped from the devices, he
8 gave notice to Orbian prior to wiping the data, no forensic copy of the devices was requested,
9 and he has already produced a copy of everything that was on the devices save for his personal
10 photographs, medical sign on information, and financial sign on information to Orbian. Id. at 4,
11 7-9. Specifically, on July 3, 2023, Orbian suspended Houston and Dunn ordered Houston to
12 return the laptop and cell phone at issue. Id. at 6. On July 18, 2023, Houston informed Orbian
13 that he would return the devices and any Orbian related information after removing and
14 retaining his personal information. Id. at 6, 8; see also ECF No. 41-1, Declaration of John
15 Vaughn In Support of Houston’s Opposition to Motion to Compel at ¶ 2, Exhibit 1. On July 24,
16 2023, Orbian responded that "all Orbian business information should be conveyed" to Orbian
17 before any data was removed which Houston did. Id. at 8; see also ECF No. 41-1, Declaration
18 of John Vaughn In Support of Houston’s Opposition to Motion to Compel at ¶ 3, Exhibit 2. Prior
19 to returning the devices, Houston contacted data destruction company Tech2U about the laptop
20 and an HP desktop. Id. at 6; see also ECF No. 41-1, Declaration of John Vaughn In Support of
21 Houston’s Opposition to Motion to Compel at ¶ ¶ 4-5, Exhibits 3-4. Houston contends that the
22 non-Orbian information on the devices is irrelevant to the case. Id. at 4. Houston further
23 contends that the laptop and cell phone “are, and always were, Houston’s property” and that
24 Houston never violated any company policies or procedures. Id. at 7. Houston notes that
25 Orbian did not ask him to refrain from deleting any personal information or request that a
26 forensic image be made. Id.; see also ECF No. 41-1, Declaration of John Vaughn In Support of
27 Houston’s Opposition to Motion to Compel at ¶ 3, Exhibit 2 (not asking for a forensic copy but
1 preserve and retain any purported personal information removed from the laptop prior to its
2 return to Orbian”). Houston notes that Orbian mischaracterizes the transcript between Houston
3 and Tech2U which concerned a desktop computer that is not at issue in the requests before the
4 Court. Id.; see also ECF No. 41-1, Declaration of John Vaughn In Support of Houston’s
5 Opposition to Motion to Compel at ¶ 5, Exhibits 3 (email between Mr. Houston and Tech2U
6 discussing “an approximately five year old laptop from Samsung and a two year old desktop
7 from HP”), 4 (Transcript between Houston and Tech2U discussing a HP all-in-one desktop).
8 Orbian replies that Houston is bound by Orbian’s policies and procedures, Orbian never
9 consented to the deletion of data from the company owned laptop and cell phone, and Houston
10 had an “independent legal obligation to maintain potentially relevant information for litigation.”
11 P Reply at 2. Orbian notes that there is documentation showing that Houston’s conversation
12 with Tech 2U was regarding the company laptop and not a desktop. Id.
13 As summarized above and set forth in more detail in the parties’ pleadings, there are
14 significant factual disputes regarding what happened and why it happened. The Court is not
15 resolving these disputes as it is not necessary to do so for the current discovery dispute. The
16 parties do not disagree with the relevancy of much of the requested information; they disagree
17 as to whether all of the relevant information has been produced and the relevancy of what
18 Defendant calls his personal information. As a result, the Court GRANTS IN PART AND
19 DENIES IN PART Orbian’s Motion to Compel on these RFPs as follows: 1) Houston must
20 turnover the cell phone and laptop at issue to Orbian as agreed [see D. Oppo at 8; ECF No. 41-
21 1, Declaration of John Vaughn In Support of Houston’s Opposition to Motion to Compel at ¶ 2,
22 Exhs. 1, 2] and 2) Houston must produce to Orbian a copy of all data stored on, copied from,
23 deleted from, or otherwise taken from the laptop and cell phone with the exception of his
24 personal photographs and medical and financial sign-on information. For purposes of this order,
25 the term “personal photographs” means any photographs that do not depict Plaintiffs,
26 Counterdefendants, any employees of those entities, or any documents or data relating to
27 Plaintiffs, Counterdefendants, or Houston’s employment or involvement with Plaintiffs. If
1 Orbian of that fact by December 16, 2024. If Houston has not produced the devices and data
2 to Orbian, he must do so by December 20, 2024.
3 Request for Production No. 7
4 RFP No. 7 seeks “[a]ll communications between You and Mintz & Gold concerning the Laptop
5 or the Phone. Petrella Decl. at Exhibit B. Houston responded to RFP No. 7 as follows: “Objection.
6 Calls explicitly for communications covered by the attorney-client privilege. Irrelevant to the
7 claims asserted in this case. Houston will not produce any documents responsive to this request.”
8 Id.
9 Orbian argues that the request seeks relevant documents not all of which are protected by
10 the attorney-client privilege. P MTC at 13-14. Orbian argues that the crime-fraud exception to
11 the attorney-client privilege, which includes the willful destruction of evidence, is relevant here.
12 Id. at 14. Orbian further argues that Houston should be required to produce a privilege log of
13 the communications and that if no such communications exist, Houston should clearly state that
14 fact. Id.
15 Defendant contends that “to the extent that he communicated with Mintz & Gold concerning
16 the laptop computer or phone, [he] certainly did so confidentially and for the purpose of
17 receiving legal advice” meaning that the communications are privileged. D Oppo. at 10.
18 Defendant further contends that the crime-fraud exception does not apply, especially here,
19 where Houston disclosed to Orbian that he would be removing his personal data from the laptop
20 and cell phone prior to doing so. Id. at 10-11. Houston notes that he has produced a privilege
21 log in the parallel arbitration and in the instant matter. Id. at 12.
22 Orbian replies that “communications regarding the deletion of data likely fall under the crime-
23 fraud exception to the attorney-client privilege” and requests that the Court conduct an
24 review of the four documents identified in Houston’s privilege log “to confirm whether
25 the attorney-client privilege applies in the first instance, and if so, whether the exception
26 applies.” P Reply at 3, 7-9. Orbian argues that “the requested communications are essential to
27 this Court’s consideration of spoliation sanctions under Fed. R. Civ. P 37(e), which Plaintiffs
1 “The attorney-client privilege does not extend to attorney-client communications which solicit
2 or offer advice for the commission of a crime or fraud.” Perez v. DirecTV Group Holdings, LLC,
3 2020 WL 10818049, at *3 (C.D. Cal., July 23, 2020) (citing In re Grand Jury Investigation, 974
4 F.2d 1068, 1071 (9th Cir. 1992). Plaintiff has the burden of demonstrating by a preponderance
5 of the evidence that the crime-fraud exception applies and must meet a two-part test to do so.
6 See In re Grand Jury Investigation, 810 F.3d 1110, 1113 (9th Cir. 2016); see also Meyer v.
7 Mittal, 2023 WL 4348731, at *6 (D. Or., July 5, 2023). “First, [Plaintiff] must show that the
8 client was engaged in or planning a criminal or fraudulent scheme when it sought the advice of
9 counsel to further the scheme. Second, [Plaintiff] must demonstrate that the attorney-client
10 communications for which production is sought are sufficiently related to and were made
11 of [the] intended, or present, continuing illegality.” Id. (emphasis in original).
12 For the Court to order review of the privileged information to establish whether
13 the crime-fraud exception is applicable, “there must be a showing of a ‘factual basis adequate
14 to support a good faith belief by a reasonable person’ that review ‘may reveal evidence to
15 establish the claim that the crime-fraud exception applies.’” Perez, 2020 WL 10818049, at *3
16 (quoting United States v. Zolin, 491 U.S. 554, 572 (1989)). This showing can be satisfied with
17 “any relevant evidence, lawfully obtained, that has not been adjudicated to be privileged.” Id.
18 (quoting Zolin, 491 U.S. at 575). If this showing is satisfied, whether an review is
19 conducted is in the discretion of the Court. Id. (citing Zolin, 491 U.S. at 575). The Court should
20 consider “the volume of materials to be reviewed, the relevance of the alleged privilege material
21 to the case, and the likelihood that review will reveal evidence to establish the
22 applicability of the crime-fraud exception.” Id. (citing Zolin, 491 U.S. at 575).
23 Orbian has not demonstrated by a preponderance of the evidence that the crime-fraud
24 exception applies and has not provided facts, as opposed to speculation, that a review “may
25 reveal evidence to establish the claim that the crime-fraud exception applies.” Moreover, the
26 Court finds that an review is not appropriate at this time. Accordingly, Orbian’s
27 request to compel documents responsive to RFP No. 7 is DENIED.
1 Request for Production No. 54
2 RFP No. 54 seeks “[a]ll postings by You (whether or not under your real name) on any social
3 media platform (including but not limited to Facebook, Twitter, Instagram, or X). Petrella Decl.
4 at Exhibit B. Houston responded to RFP No. 54 as follows: “Objection. This request seeks
5 information that is irrelevant to any claim at issue in this matter. The request is overbroad in
6 time, subject matter, and scope. The request is invasive of Houston’s right to privacy. Houston
7 will not produce any documents in response to this request. Id.
8 Orbian argues that the request seeks relevant information that demonstrates “Houston’s
9 willful disregard of Orbian’s instructions, as well as a breach of his obligations to Orbian.” P
10 MTC at 17. Orbian notes that the documents are only available to Houston and that it tried to
11 subpoena the records from X Corp but was informed that federal law prevented X Corp from
12 turning over the documents. Id. at 18.
13 Defendant contends his social media is irrelevant and unrelated to Orbian’s causes of action.
14 D Oppo at 12. Even if the information is relevant, Houston contends that he no longer has
15 access to the Twitter/X account because it was suspended and deactivated in 2018. Id. at 13.
16 Regarding Houston’s LinkedIn and Facebook accounts, Orbian has equal access to those
17 accounts. Id.
18 Orbian replies that Houston’s social media posts are directly relevant to the claims and
19 defenses in this case and that recovering the information is a “simple, costless task” that the
20 Court should require Houston to perform. P Reply at 3, 9-11.
21 The Court finds that the request as written is overbroad as to time, subject matter, and
22 scope. The request seeks every posting Houston has ever made on any social media platform
23 that exists without any limitations. As such, the request seeks irrelevant information and is not
24 proportional to the needs of this case. Accordingly, Orbian’s motion to compel further response
25 to RFP No. 54 is DENIED.
26 Request for Production No. 81
27 RFP No. 81 seeks “[a]ll documents concerning any Plaintiff or Counter-Defendant.” Petrella
1 Objection. This request for production is duplicative of Request for Production
No. 53, among others. The request is overly broad and unduly burdensome.
2 The request fails to specify with reasonable particularity the documents sought.
The request is inadequately tailored to the needs of the case. Calls for
3 information equally or exclusively available to propounding party. Given the
improper scope of the request, Houston will not produce documents responsive
4
to this request.
5
6 Id.
7 Orbian has agreed to limit this request “the time period beginning with Houston’s
8 employment suspension on July 3, 2023 until Orbian filed its Complaint on April 26, 2024, and
9 will also exclude communications with litigation counsel from its request.” P MTC at 15. Orbian
10 argues that this limitation addresses Houston’s concerns and notes that the request seeks
11 information that only Houston possesses and that the request is tailored to the needs of the
12 case. Id. at 15-16.
13 Defendant contends that he will “provide an amended response to the request which clarifies
14 that Houston has or will produce all responsive documents in his possession, custody, or control.”
15 D Oppo at 13. Specifically, Houston identifies HOUSTON-AAA l-1659 as the already-produced
16 responsive documents.” Id.
17 Orbian’s reply acknowledges that Houston has agreed to provide amended responses but
18 “reserves [Orbian’s] right to object should Houston’s future responses be insufficient to fully
19 satisfy his discovery obligations.” P Reply at 3.
20 Orbian’s motion to compel documents requested in RFP No. 81 as modified by Orbian is
21 DENIED AS MOOT. Houston has agreed to provide an amended response and any additional
22 responsive documents that are in his possession, custody, and/or control. Houston must do so
23 by December 20, 2024.
24 II. Defendant’s Motion to Compel Production of Documents from Orbian
25 Corporation Limited and Thomas Dunn
26 Defendant Houston seeks an order from the Court compelling Plaintiff Orbian Corporation
27 Limited and Counterdefendant Thomas Dunn to produce responsive documents and requiring
Orbian and Dunn pay to Houston the reasonable costs and attorneys' fees incurred in connection
1 with this motion. D MTC at 1. The requests at issue concern “jurisdictional discovery requests
2 from and relating to Dunn (sought both from Dunn and from Orbian)[] and [] requests sent to
3 Orbian related to Houston's claims and defenses and the claims and defenses of the other
4 parties.” Id. at 5. Houston notes that Dunn has not produced a single document in response
5 to the thirty-seven RFPs Houston propounded in July 2024. Id. at 14.
6 Orbian and Dunn contend that Plaintiff’s request for jurisdictional discovery should be denied
7 as Houston has failed to make the threshold showing required for jurisdictional discovery and,
8 even if he had, the requests to Orbian are improper. P Oppo. Orbian and Dunn also contend
9 that the requests that are not strictly jurisdictional are duplicative and improper. Id. at 11-12.
10 Orbian states that RFP Nos. 15-17 are overbroad and disproportionate to the needs of the case
11 and that RFP Nos. 22-23 seek irrelevant information that bears no relation to any of the claims
12 or defenses at issue. Id. at 12-15. Finally, Orbian contends that Houston’s request for sanctions
13 should be denied because Plaintiff’s refusal to produce documents was substantially justified. P
14 Oppo at 15-16.
15 Jurisdictional Discovery Propounded by Houston to Orbian and Dunn
16 Houston propounded discovery on Orbian and Dunn regarding jurisdictional issues. D
17 MTC at 5. The discovery to Orbian consisted of RFP Nos. 1, 19, and 73 and the discovery to
18 Dunn includes all thirty-seven RFPs that Houston propounded.1 Id.
19 Request for Production No. 1 to Orbian
20 RFP No. 1 seeks “[a]ll DOCUMENTS submitted by YOU to any governmental or regulatory
21 body that state or indicate that DUNN is YOUR ‘control person.’” ECF No. 39-1, Declaration of
22 John Vaughn in Support of Defendant’s Motion to Compel (“Vaughn Decl.”) at Exhibit 4. Orbian
23 responded to RFP No. 1 as follows:
24 Orbian objects to this Request on the grounds that it is overbroad, unduly
burdensome, vague and ambiguous, and not proportional to the needs of the
25
case. Orbian further objects to this Request to the extent it calls for documents
26 that are available from a public source. Finally, Orbian objects to this Request
27
1 Houston contends that the thirty-seven RFPs propounded to Dunn seek information regarding
1 as irrelevant; whether Mr. Dunn is a “control person” is unrelated to any claim
or defense with respect to the parties’ claims or counterclaims. For the above
2 reasons, Orbian will not produce documents in response to this Request.
3
4 Id.
5 Request for Production No. 19 to Orbian
6 RFP No. 19 seeks “[a]ll phone records for DUNN’S mobile phone, telephone number 44-
7 755-337-1064.” Vaughn Decl. at Exhibit 4. Orbian responded to RFP No. 19 as follows:
8 Orbian objects to this Request on the grounds that it is overbroad, unduly
burdensome, vague and ambiguous, and not proportional to the needs of the
9
case. Orbian further objects to this Request to the extent it calls for documents
10 and information protected by the attorney-client and work product privileges,
and to the extent that it seeks private information about persons in violation of
11 those persons’ constitutional, statutory and/or common law rights of privacy.
12 For the above reasons, Orbian will not produce documents in response to this
Request.
13
14 Id.
15 Request for Production No. 73 to Orbian
16 RFP No. 73 seeks “[a]ll DOCUMENTS that RELATE TO any travel to California by DUNN
17 from January 1, 2012 through July 12, 2024. Vaughn Decl. at Exhibit 4. Orbian responded to
18 RFP No. 73 as follows:
19 Orbian objects to this Request on the grounds that it is overbroad, unduly
burdensome, and not proportional to the needs of the case, including because
20
it seeks all documents relating to any travel by Dunn for any reason for a twelve
21 year period. Orbian also objects to this Request as irrelevant; unless Mr. Dunn’s
travel to California relates to the agreements at issue in this case, it is unrelated
22 to the parties’ claims or counterclaims. Subject to and without waiving those
objections or the General objections, Orbian’s counsel is willing to meet and
23
confer in a good faith attempt to narrow the scope of this Request.
24
25 Id.
26 Houston argues that jurisdictional discovery should be ordered as the discovery being
27 sought is directly related to Dunn’s contacts with California and Dunn’s potential liability under
1 orders otherwise and that Courts typically grant jurisdictional discovery when the discovery being
2 sought is relevant to a jurisdictional issue in the case. Id. at 6-7. Houston argues that the
3 question of the Court’s jurisdiction over Dunn is critical, and that discovery related to Dunn’s
4 contacts with California is relevant as “[d]ocuments that related to Dunn’s activity in directing
5 and guiding Houston’s employment, Houston’s compensation and Dunn’s status as the person
6 in charge of the Orbian entities, is at the very heart of the jurisdictional inquiry.” Id. at 7-8.
7 Plaintiff contends that Houston’s counter complaint fails to allege personal jurisdiction
8 over Plaintiff Dunn which is the subject of its pending Motion to Dismiss and that jurisdictional
9 discovery “is not available as of right” but only pursuant to the Court’s discretion. P Oppo at 6.
10 Plaintiff also contends that the case law cited by Houston cuts against his arguments and that
11 additional discovery would not present facts constituting a basis for jurisdiction here, where
12 Dunn is a citizen of the United Kingdom, not a party to any written agreement at issue in the
13 case and does not have sufficient contacts with California. Id. at 8-9.
14 On December 3, 2024, Judge Whelan issued an Order Granting in Part and Denying in
15 Part Counterdefendant’s Motion to Dismiss the Counterclaim. ECF No. 47. In the Order, Judge
16 Whelan addressed Houston’s request for jurisdictional discovery and concluded that “there are
17 no controverted jurisdictional issues that could be resolved with discovery. Therefore, the Court
18 finds that jurisdictional discovery is unnecessary, and the request is denied.” Id. at 10.
19 Accordingly, Houston’s motion to compel responses from Orbian to RFP Nos. 1, 19, and 73 is
20 DENIED. In the same order, Judge Whelan stated “Orbian’s motion to dismiss
21 Counterdefendant Mr. Dunn on personal jurisdiction is GRANTED.” Id. at 21 (emphasis in
22 original). In light of Mr. Dunn’s dismissal from the case, Houston’s motion to compel production
23 of documents from Counterdefendant Dunn is DENIED AS MOOT.
24 Merits Discovery Propounded by Houston to Orbian
25 Request for Production Nos. 15-17 to Orbian
26 RFP No. 15 seeks “[a]ll emails sent or received by HOUSTON to or from any of YOUR
27 employees from January 1, 2016 through July 3, 2023.” Vaughn Decl. at ¶ Exhibit 4. Orbian
1 Orbian objects to this Request on the grounds that it is overbroad, unduly
burdensome, vague and ambiguous, and not proportional to the needs of the
2 case. The Request calls for all emails exchanged with Houston by an Orbian
employee for over six years, regardless of subject matter. Orbian further objects
3 to this Request to the extent it calls for documents already within the
possession, custody, or control of Mr. Houston, or documents and information
4
protected by the attorney-client and work product privileges. For the above
5 reasons, Orbian will not produce documents in response to this Request.
6 Id.
7 RFP No. 16 seeks “[a]ll Microsoft Teams messages sent or received by HOUSTON to or
8 from any of YOUR employees from January l, 2020 through July 3, 2023. Vaughn Decl. at ¶
9 Exhibit 4. Plaintiff responded to RFP No. 16 as follows:
10
Orbian objects to this Request on the grounds that it is overbroad, unduly
11 burdensome, vague and ambiguous, and not proportional to the needs of the
case. The Request calls for all Microsoft Teams messages with Houston over a
12 three-and-a-half year period, regardless of subject matter. For the above
reasons, Orbian will not produce documents in response to this Request.
13
14 Id.
15 RFP No. 17 seeks “[a]ll records of Microsoft Teams calls initiated or received by HOUSTON
16 to or from any of YOUR employees from January I, 2020 through July 3, 2023.” Id. at 10.
17 Plaintiff responded to RFP No. 17 as follows:
18 Orbian objects to this Request on the grounds that it is overbroad, unduly
burdensome, vague and ambiguous, and not proportional to the needs of the
19
case. The Request calls for all records of Microsoft Teams calls with Houston
20 over a three-and-a-half year period, regardless of subject matter. Orbian further
objects to this Request to the extent it calls for documents and information
21 protected by the attorney-client and work product privileges. For the above
reasons, Orbian will not produce documents in response to this Request.
22
23 Id.
24 Houston argues that he is entitled to review the evidence that was created during his
25 employment with Plaintiffs and ultimately used by Plaintiffs to justify his termination. D MTC at
26 11. Houston argues that he needs the communications sought in order “to understand the full
27 context from which [Plaintiffs] cherry-picked interactions, sound bites, and pull quotes come
[sic].” Id. Houston further argues that he appropriately limited the time frame of the requests.
1 Id. Houston notes that Plaintiffs put these communications at issue by relying on them as the
2 basis of their investigation and that Plaintiffs have failed to specifically state why the requested
3 production would be overly burdensome. Id. Houston argues that given Plaintiff’s “substantial
4 resources and sole possession of the relevant information[,]” Plaintiff cannot show undue
5 burden. Id. at 13.
6 Orbian contends that RFP Nos. 15-17 are overbroad and disproportionate to the needs of
7 the case, and they are not limited in scope and cover a seven-year period of time. P Oppo at
8 12-13. Plaintiff notes that it has already agreed to produce the abusive communications in
9 question and that communications with employees are irrelevant to Plaintiff’s fraud allegations
10 against Houston which did not involve other employees. Id. at 13. Plaintiff contends that many
11 of the requested communications will be privileged as Houston was a lawyer for Orbian during
12 the period covered by the RFPs and that reviewing the communications for privilege would be
13 an extreme burden to place on Orbian. Id. at 14.
14 Houston replies that Orbian and Dunn fail to state how the requests are disproportionate
15 to the needs of the case and fail to assess the factors that should be considered when taking
16 that position. D Reply at 5. Houston notes that he is willing to narrow the requests, but Orbian’s
17 refusal to produce any documents at all is problematic. Id. Houston further notes that Dunn
18 admitted to reviewing tens of thousands of emails in preparation for his deposition which means
19 those emails can and should be produced. Id. Houston replies that he does not have to accept
20 Orbian’s view of this case and that denying his access to this discovery “deprives Houston of the
21 ability to defend himself and prosecute his claims” and “requires Houston to accept Plaintiffs'
22 positions untested and unexplored.” Id. at 7.
23 RFP Nos. 15-17 which seek every single email, Teams message, and Teams Call between
24 Houston and every Orbian employee, on any topic, over a three-to-seven-year period, is
25 overbroad. While Houston identifies types of communications that he believes are relevant and
26 states that he is willing to narrow his requests, he does not actually do so. The requests as
27 written, and for which he moves to compel response, are overbroad. Accordingly, Houston’s
1 Request for Production Nos. 22-23 to Orbian
2 RFP No. 22 seeks “[a]ll audit workpapers submitted to YOUR auditors listing the Samsung
3 laptop purchased by HOUSTON in 2018 and turned over to YOU in August 2023 by HOUSTON
4 as capitalized equipment for the audit years 2017 through 2023.” Vaughn Decl. at ¶ Exhibit 4.
5 RFP No. 23 seeks “[a]ll audit workpapers submitted to YOUR auditors listing the iPhone bearing
6 the number (415) 794-6755 turned over to YOU in August 2023 by HOUSTON as capitalized
7 equipment for the audit years 2017 through 2023.” Vaughn Decl. at ¶ Exhibit 4. Plaintiff
8 responded to RFP Nos. 22 and 23 as follows:
9 Orbian objects to this Request on the grounds that it is overbroad, unduly
burdensome, vague and ambiguous, and not proportional to the needs of the
10
case. Orbian further objects to this Request to the extent it calls for documents
11 and information protected by the attorney-client and work product privileges.
For the above reasons, Orbian will not produce documents in response to this
12 Request.
13
14 Id.
15 Houston argues that the information sought in RFP Nos. 22 and 23 is relevant given that
16 Plaintiffs are actively seeking to set up a spoilation of evidence claim that will be impacted by
17 the ownership of the laptop and cell phone at issue. D MTC at 14. Houston notes that the
18 request is narrowly tailored and addresses an issue that Plaintiff has raised. Id.
19 Plaintiff contends that the requests are irrelevant and have no bearing on the claims or
20 defenses in the case. P Oppo at 14. Orbian notes “[t]here is no genuine dispute that these
21 devices belonged to Orbian” and that it has provided Houston with proof that the devices were
22 paid for by Orbian. Id. at 14-15. Orbian further contends that the accounting treatment of the
23 laptop and phone have no bearing on the ownership issue and, even if it did, the requests are
24 overbroad and disproportionate to the needs of the case. Id. at 15.
25 Houston replies that the requests for auditing paperwork are relevant and that if Orbian
26 has them, they should be produced. D Reply at 6. Houston notes that if Orbian does not have
27 the requested documents, it should say that no documents exist. Id. Houston further notes that
1 Houston’s request to compel further response to RFP Nos. 22-23 is GRANTED. The
2 requests are narrowly tailored and Orbian fails to explain how the requests which are limited to
3 two devices and six years are unduly burdensome. Orbian’s position that there is no genuine
4 dispute over the ownership of the devices ignores Houston’s clearly stated position that he
5 owned the devices. In addition, Orbian is not permitted to refuse to respond to the requested
6 discovery because it provided receipts that it feels are sufficient when receipts are not what RFP
7 Nos. 22-23 seek. If the documents are subject to a privilege as Orbian suggests, Orbian must
8 follow the proper procedure such as providing a privilege log. Orbian must supplement its
9 responses and produce all responsive documents by December 20, 2024.
10 Attorneys’ Fees/Sanctions
11 Houston argues that Plaintiff’s objection to the instant motion is not justified because it
12 has refused to participate in discovery and stated that it will not comply with jurisdictional
13 discovery requests “absent a court order.” D MTC at 14; see also Vaughn Decl. at ¶ ¶ 5 and 7
14 and Exhibits 6 and 8. The same argument applies to Dunn who has “not produced a single
15 document.” Id. Houston argues that Orbian and Dunn should be sanctioned because he has
16 been forced to incur fees and expenses “as a result of having been forced, without legal
17 justification, to bring the instant motion.” Id. at 15.
18 Orbian contends that Houston’s request for sanctions should be denied as Orbian and
19 Dunn’s refusal to produce documents in response to Houston’s RFPs is substantially justified. P
20 Oppo at 15-16.
21 Houston replies that the Court should award him fees “in connection with the pursuit of
22 his motion.” D Reply at 8.
23 If a motion to compel is granted or the requested discovery is provided after a motion to
24 compel was filed, that court must order the payment of reasonable expenses unless “the
25 opposing party's nondisclosure, response, or objection was substantially justified.” Fed. R. Civ.
26 P. 37(a)(5)(A)(iii). If a motion is granted in part and denied in part, the court “ , after giving
27 an opportunity to be heard, apportion the reasonable expenses for the motion.” Fed. R. Civ. P.
1 Houston’s request for sanctions is DENIED. As an initial matter, Judge Whelan stated
2 ||that “there are no controverted jurisdictional issues that could be resolved with discovery|, |”
3 denied the request for jurisdictional discovery, and dismissed Dunn from the case. As a result,
4 || the Court finds Counterdefendants’ failure to respond to many of the RFPs was substantially
5 || justified. With regard to the remaining RFPs, the majority of them were not granted and
6 || therefore do not merit sanctions. Finally, the Court finds that the circumstances surrounding
7 remaining disputes do not warrant the imposition of sanctions.
8 CONCLUSION
9 For the reasons set forth above, Plaintiff's Motion to Compel Discovery from Defendant is
10 || GRANTED IN PART AND DENIED IN PART and Defendant's Motion to Compel Production
11 || of Documents from Orbian Corporation Limited and Thomas Dunn is GRANTED IN PART AND
12 |}DENIED IN PART. All supplemental or amended responses and production of documents and
13 ||items ordered above must be served by December 20, 2024.
14 IT IS SO ORDERED.
15 ||Dated: 12/11/2024 iy, , be He we
16 Hon. Barbara L. Major
United States Maqistrate Judde
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