Generation Brands, LLC v. Decor Selections, LLC
| Decision Date | 16 October 2020 |
| Docket Number | No. 19 C 6185,19 C 6185 |
| Parties | GENERATION BRANDS, LLC, et al., Plaintiffs, v. DECOR SELECTIONS, LLC, et al., Defendants. |
| Court | U.S. District Court — Northern District of Illinois |
MEMORANDUM OPINION AND ORDER
Fact discovery in this case was set by Judge Chang to close on January 11, 2021. [Dkt. #69]. On September 22, 2020 the plaintiffs filed a Motion to Compel Defendants to Remove "Attorneys' Eyes Only" Designation and Produce Documents. [Dkt. #94]. The Response was filed on October 5, 2020. [Dkt. #98]. For the following reasons, the Motion is granted in part and denied in part. A telephonic status hearing is set for December 11, 2020 at 9:00 a.m.
Although this case is only about a year old, it involves or has already involved fourteen attorneys from six law firms, spread across five states from the east coast to the west coast. There have already been three versions of the Complaint - the current one being a massive 180-paragraph submission [Dkt. #93] - and there have been two Motions to Dismiss. [Dkt. ##27, 38]. Simply put, the case is about the design, manufacture and distribution by the plaintiff of lighting fixtures. The defendants are charged with having sold those fixtures over the internet without authorization from the plaintiffs. It is not, as the saying goes, the first rodeo for defendant, Larry Krayzman. See, e.g., Minka Lighting, Inc. v. Bath Kitchen Decor, LLC, 2015 WL 12743863, at *4 (C.D. Cal. 2015); Troy--CSL Lighting, Inc. v. Bath Kitchen Decor, LLC, 2014 WL 12911165, at *5 (C.D. Cal. 2014).
Plaintiffs served their discovery requests on February 24, 2020, making defendants' responses due March 25th. But the Chief Judge's series of Coronavirus Orders extended that deadline to June 10th. But, as it turned out, the defendants used that extra time to mount the usual non-objections, like "overbroad," "unduly burdensome," and "disproportionate to the needs of the case," and "vague and ambiguous."1 Defendants did not produce a single document, stating instead that responsive documents didn't exist or that they would conduct a reasonable search. [Dkt. #94-2]. While this type of response to a discovery request is, unfortunately, one that is all too often employed, the defendants' response is remarkable in that more than 100 days were required to put it together and - according to defendants - they hadn't even begun to look for documents.
Plaintiffs' counsel sent defendants' counsel a 4-page, single-spaced letter detailing the many deficiencies in defendants' offering on June 23rd. [Dkt. #94-3]. Defense counsel responded with a 6-page, single-spaced, "I-know-you-are-but-what-am-I" letter listing plaintiffs' discovery lapses a couple of weeks later. [Dkt. #94-4]. There followed the usual sniping back and forth through emails, mostly around the Fourth of July weekend, and focused whether one side was delaying or the other was trying to ruin the holiday. [Dkt. #94-5]. The exchange will not be quoted or detailed beyond what is necessary given the unfortunate aspersions. There followed a couple of Local Rule 37.2 phone conferences, accomplishing little, and Mr. Krayzman asked defense counsel to withdrawfrom the case at the end of July. [Dkt. # 79].
So, plaintiffs had to virtually start over with new defense counsel. Still, to this day, going on eight months after plaintiffs' document requests were served, plaintiffs claim defendants have not produced a single document. Conversely, and staggeringly, new defense counsel attests that he has reviewed previous discovery, including both parties' Mandatory Initial Disclosure Pilot Project disclosures, seven sets of discovery requests and responses, and 67,921 documents were produced by defendants. Clearly, there is an unmanageable gulf between the plaintiffs' statement of where document production stands and the defendants' statement of where it stands. More on this later as there is, at least, one concrete dispute between the parties that is ripe for resolution.
When the defendants finally got around to providing their supplemental interrogatory discovery responses, they insisted that the names of their third-party lighting fixture suppliers be designated as "attorneys' eyes only." The plaintiff wants that designation removed so they can see where their unauthorized lighting fixtures are coming from.
The parties agreed to a Confidentiality Order, which Judge Chang entered on March 10, 2020. The Order allows for the designation of certain information - (a) information prohibited from disclosure by statute; (b) information that reveals trade secrets; (c) research, technical, commercial or financial information that the party has maintained as confidential; (d) medical information concerning any individual; (e) personal identity information; (f) income tax returns (including attached schedules and forms), W-2 forms and 1099 forms; or (g) personnel or employment records of a person who is not a party to the case, and which allows for this designation - as "Confidential." The Order also allowed for a higher level of protection - "Highly Confidential -Attorneys' EyesOnly" - if the information's confidentiality and sensitivity warrants additional protection and is "(1)within the scope of Rule 26(c)(1)(G) and is current or future business or technical trade secrets, and plans, or (2) Confidential Information the disclosure of which would contravene an obligation of confidentiality to a third person or to a Court." [Dkt. #50, Par. 2]. Under the agreed terms, the burden is on the defendants to convince the court that the names of its suppliers are so highly confidential and sensitive as to warrant such a restrictive designation. [Dkt. # 50, Par. 9(b)]. Defendants have failed to meet that burden here.
There is nothing inherently confidential or secret about the name of a lighting fixture supplier. Harry Lime is not distributing lamps under the cover of darkness in the rubble of post-war Central Europe to the accompaniment of a zither. Defendants contend that the names of the suppliers meet the definition of "commercial or financial information that the party has maintained as confidential," but the court is skeptical. There is nothing in Mr. Krayzman's Declaration [Dkt. #98-5] that suggests any steps he has taken to maintain the secrecy of these suppliers' identities. See, e.g., Abrasic 90 Inc. v. Weldcote Metals, Inc., 364 F. Supp. 3d 888, 902 (N.D. Ill. 2019)(discussing steps taken to maintain secrecy of commercial information including names of suppliers); Autotech Techs. Ltd. P'ship v. Automationdirect.com, Inc., 235 F.R.D. 435, 443-44 (N.D. Ill. 2006)(discussing steps party took to keep customer names secret).
Mr. Krayzman also claims that he cannot reveal the names of the suppliers because that "would contravene an obligation of confidentiality to" them. Conveniently, he says he has no written agreements with any of his suppliers, but insists that one of the terms of his oral supply agreements with them is that he keep their identities confidential. [Dkt. #98-5]. Confidentiality agreements are traditionally in writing - see, e.g., Superior Graphite Co. v. Campos, 2020 WL5210841 (N.D. Ill. 2020) - but apparently not here, and despite the seeming importance of the claimed secrecy agreement. But even if one were to uncritically accept Mr. Krayzman's claim, it is truly surprising that, in the months since this issue has come up, he has been unable to secure even one statement from a single supplier detailing a desire for anonymity. "[U]nfortunately...saying so doesn't make it so...." United States v. 5443 Sufield Terrace, Skokie, Ill., 607 F.3d 504, 510 (7th Cir.2010). On the other hand, plaintiffs have made a case that they need to review this information as it goes to the heart of their claims. See Maui Jim, Inc. v. SmartBuy Guru Enterprises, 2018 WL 1071444, at *3 (N.D. Ill. 2018)(overruling objections to magistrate judge's finding that "it would hamstring [plaintiff] in being able to identify whether the sales of [plaintiff's] glasses to [defendant] were coming through authorized distributors [or] whether they were authentic glasses or not, because . . . counsel would not have the ability by themselves to understand the significance of the information that they were getting from [defendant]."); Glob. Material Techs., Inc. v. Dazheng Metal Fibre Co., 133 F. Supp. 3d 1079, 1090 (N.D. Ill. 2015)(plaintiff "has a substantial interest in being able to view these documents with its attorneys because the information conveyed therein goes to the heart of its trade secrets claims"). As such, as a matter of discretion, I exercise my discretion to reject defendants' desire to designate this information as "attorney's eyes only" and grant this portion of plaintiffs' Motion.
Clearly, the parties are so far apart regarding what has been produced and what is lacking - over 60,000 documents apart - that the portion of plaintiffs' Motion regarding document production cannot be resolved at this time. Here is a perfect example of why a genuine "meet and confer" is a necessity under Local Rule 37.2. Formerly, it had become almost commonplace to payno more than lip service to the Local Rule and to hash out their discovery disputes at motion hearings, one request at a time, with a magistrate judge or district court judge. But the Chief Judge's moratorium on motion hearings has all but eliminated that avenue [Dkt. # 77], and resolution of these types of often routine discovery disputes on papers-only has often become incredibly difficult and unwieldy - and often needlessly time consuming and thus affecting other litigants waiting in the queue for resolution of their cases. Channell v. Citicorp Nat. Services, Inc., 89 F.3d 379, 386 (7th Cir. 1996); Szabo Food Service, Inc. v. Canteen Corp., 823 F.2d 1073, 1077 (7th Cir. 1987). Good faith adherence to Local Rule 37.2 is more...
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