Meyer v. Mittal

• Decision Date: 17 April 2023
• Docket Number: 3:21-cv-00621-HZ
• Parties: JASON MEYER, an individual; ARGIL DX LLC f/k/a ZAP TECHNOLOGY SOLUTIONS LLC, a Nevada limited liability company; and ARGIL DX, putative partnership, Plaintiffs, v. ANKUR MITTAL, an individual; AXENO CONSULTING PVT. LTD. f/k/a ARGILDX CONSULTING PVT. LTD. f/k/a ACCUNITY SOFTWARE PVT. LTD., an Indian private company; and ADX CONSULTING INC., a Texas corporation, Defendants.
• Court: U.S. District Court — District of Oregon

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JASON MEYER, an individual; ARGIL DX LLC f/k/a ZAP TECHNOLOGY SOLUTIONS LLC, a Nevada limited liability company; and ARGIL DX, putative partnership, Plaintiffs, v. ANKUR MITTAL, an individual; AXENO CONSULTING PVT. LTD. f/k/a ARGILDX CONSULTING PVT. LTD. f/k/a ACCUNITY SOFTWARE PVT. LTD., an Indian private company; and ADX CONSULTING INC., a Texas corporation, Defendants.

No. 3:21-cv-00621-HZ

United States District Court, D. Oregon

April 17, 2023

Heather Harriman

Eric Lang

Rose Law Firm, P.C.

Attorneys for Plaintiffs

Sara Cotton

Nika Aldrich

Mario Delegato

Schwabe, Williamson & Wyatt, P.C.

Attorneys for Defendants

OPINION & ORDER

MARCO A. HERNANDEZ UNITED STATES DISTRICT JUDGE

Before the Court is Defendants' Motion for Partial Summary Judgment and for Sanctions. ECF 106. Defendants move for summary judgment on their Stored Communications Act (“SCA”) counterclaim against Plaintiffs Jason Meyer and Argil DX LLC (“Zap”). They also move for sanctions including dismissal of all of Plaintiffs' causes of action with prejudice, exclusion of certain documents and all evidence derived from those documents, an order that Plaintiffs destroy certain documents and certify to the Court that they have done so, and attorney fees and costs. Finally, Defendants move for limited discovery of Plaintiffs' counsel's law firm. For the following reasons, the Court denies the motion.

BACKGROUND

This case arises from a business collaboration that went sour. Plaintiff Jason Meyer is the sole member of Plaintiff Argil DX LLC, formerly known as Zap,^[1] a web-design company. Meyer Decl Opp. Summ. J. ¶ 4, ECF 133. Plaintiffs Meyer and Zap are based in Oregon. Id. ¶ 3. Defendant Axeno Consulting was co-founded under the name “Accunity” by Defendant Ankur Mittal in 2014 and is based in India. Mittal Decl. Summ. J. ¶ 4, ECF 107. Axeno and four of its executives, including Defendant Mittal, formed ADX Consulting, a Texas corporation, in September 2020. Id. ¶ 20. The goal was to expand Axeno's presence in the United States. Id. The plaintiff partnership is an entity whose existence the parties dispute. Plaintiffs Meyer and Zap assert that Zap and Axeno (then known as Accunity) formed a partnership in 2017. Pl. Resp. 3-4, ECF 134.^[2] Defendants assert that the parties created a joint brand but no partnership. Def. Mot. Summ. J. 5-6. This collaboration was called Argil DX. Meyer Decl. Opp. Summ. J. ¶ 11.

I. The Parties' Collaboration

Plaintiff Meyer and Defendant Mittal held a meeting in Portland, Oregon, in or about February 2017 to discuss their collaboration. Id. ¶ 10, Ex. O (accepted calendar invite from Plaintiff Meyer to Defendant Mittal with subject line “Talk about work Plan and Merger”). In March 2017, Defendant Mittal wrote to Plaintiff Meyer, “I think it's just a beginning of a new journey of our partnership so looking forward to this journey.” Id. ¶ 10, Ex. P. In July 2017, the parties created a website for the partnership, Argil DX, with the headline “ZAP Technology Solutions Merges with Accunity Software to form ARGIL DX.” Id. ¶ 11, Ex. Q at 1. Defendant Mittal posted about the merger on Twitter. Id. at 2.

Following the announcement of merger, Defendant Mittal and Plaintiff Meyer were referred to as co-founders of the partnership. Meyer Decl. Opp. Summ. J. ¶¶ 12-13, Exs. R (organizational chart listing Plaintiff Meyer as CEO/President and Defendant Mittal as President), S (Twitter profile of Defendant Mittal listing him as “MD and Founder, Argil DX”), W (Linked In page showing Defendant Mittal as “President at Argil DX” and Defendant Meyer as “CEO of Argil DX”), T (website for Argil DX listing Plaintiff Meyer as “CEO & President Global” and Defendant Mittal as “President, APAC”), U (Facebook page for Argil DX listing location in Beaverton, OR).

According to Plaintiff Meyer, the parties devised a system to share revenues from projects. Meyer Decl. Opp. Summ. J. ¶ 14. Plaintiff Meyer states that “[s]hared profits would be calculated on a project-by project basis by deducting a project's expenses (not including operating and overhead costs) from its revenues.” Id. He states that “[t]he difference between Project Revenues and expenses would then be shared between the partners.” Id. See also Mittal Decl. Summ. J. Ex. 3 (email from Plaintiff Meyer to Defendant Mittal discussing profit sharing).

Plaintiff Meyer and Defendant Mittal did not sign a document memorializing the merger. Aldred Reply Decl. Ex. 33, Meyer Dep. I 48:9-18, ECF 142. They did not create a written partnership agreement. Id. at 57:11-19. According to Plaintiff Meyer, he and Defendant Mittal agreed that they would each be called a co-founder. Id. at 58:5-7. Plaintiff Meyer did not recall discussing additional rights or obligations for their respective businesses. Id. at 58:17-25. Plaintiff Meyer and Defendant Mittal did not discuss governing law or taxation for the partnership. Id. at 60:17-61:7. The parties generally agreed that the respective businesses would handle personnel matters for their own employees. Id. at 63:8-64:6.

Defendant Mittal asserts that he never intended to form a partnership and instead expected that Axeno would be a subcontractor for Zap. Mittal Decl. Summ. J. ¶¶ 6, 10. According to Defendant Mittal, “Axeno performed labor and invoiced Zap for those services. Zap invoiced the customers, received the funds, and paid Axeno based on its invoices.” Id. ¶ 10. Defendant Axeno continued to pursue projects without Zap, and Plaintiff Zap continued to pursue projects without Axeno. Id. ¶ 9, Ex. 1 at 1-2 (messages between Plaintiff Meyer and Defendant Mittal discussing subcontracting opportunities).

II. The Parties' Email Domain and Server

As part of their collaboration, the parties used email addresses with the @argildx.com domain name. Meyer Decl. Opp. Summ. J. ¶ 8. Defendant Mittal acquired the domain name “[i]n support of this joint branding effort.” Mittal Decl. Summ. J. ¶ 8. The parties' email was provided through a Microsoft Office 365 account. Meyer Decl. Opp. Summ. J. ¶ 8. Zap entered into a subscription agreement with Microsoft for the account in August 2015. Id. ¶¶ 5-6. Plaintiff Meyer executed the agreement on behalf of Zap in his capacity as president of Zap. Id. ¶ 7. The Office 365 account stored emails sent from and received by the @argildx email addresses in Microsoft's cloud server. Id. ¶ 8. This server space was part of the account to which Zap subscribed. Id.

Zap has always paid the monthly subscription fee to Microsoft. Id. ¶ 8. Between May 2017 and around December 2021, this fee was divided between Zap and Axeno. Id. Plaintiff Meyer was the first global administrator of the Office 365 account and has always been a global administrator of the account. Id. ¶ 9. Plaintiff Meyer gave Defendant Mittal global administrator privileges as part of the parties' collaboration. Mittal Decl. Summ. J. ¶ 15; Meyer Decl. Status Quo ¶ 9, ECF 95; Meyer Decl. Opp. Summ. J. Ex. V (showing that Zap was the organization with the Office 365 subscription). Plaintiff Meyer revoked Defendant Mittal's administrator access in December 2021. Meyer Decl. Status Quo ¶ 21.

Defendant Mittal moved all of the emails for the business then known as Accunity from a Gmail server to the Microsoft 365 server in or about June 2017. Mittal Reply Decl. ¶ 3, ECF 141. He told Plaintiff Meyer, “I am not comfortable sharing my accunity mail password with” Long Phan, one of Zap's employees. Id. Ex. 32. Plaintiff Meyer responded, “Ok. I understand, but he will (does) have access to the [argildx domain] email. He's going to be administering it.”

Id. Defendant Mittal then responded, “You mean, he can login as me?” Id. Plaintiff Meyer responded, “I don't think so. But I'm not sure. He has global administrator access. I'm not sure what that means. I would think it would not mean that he can read other people's email. But that's a good thing for me to check.” Id. Defendant Mittal responded, “I think office 365 allows impersonation. And if that is there, it is not right. Legally as well. We should definitely check that.” Id. Plaintiff Meyer then responded that he looked into the issue and “I cannot impersonate anyone unless I go into administration and set it up for each user that I want to be able to impersonate.” Id. He offered to have Long Phan sign something related to access. Id. Defendant Mittal responded that “I think you should let him know that for any reason if it comes to a point that he needs to access your or mine [sic] account, he should first take an approval.” Id. Plaintiff Meyer responded, “Yes, I'll let him know that if he needs to access anyone's email account, he needs permission.” Id.

A Microsoft 365 account comes with a set of administrative roles that can be assigned to users. Williams Decl. Opp. Summ. J. Ex. H at 1, ECF 131. According to Microsoft's description, a global administrator has “almost unlimited access to [the] organization's settings and most of its data.” Id. at 2. The person who signs up for the service automatically becomes a global administrator. Id. at 4.

Subscribers to a Microsoft 365 account are subject to an online subscription agreement. Williams Decl. Opp. Summ. J. Ex. G. The agreement is between Microsoft and the entity the individual represents or, if there is no designated entity the individual user. Id. at 1. It provides that the subscriber “control[s] access by End Users[.]” Id. at 2. “End Users” are defined as “any person [the subscriber] permit[s] to access Customer Data hosted in the Online Services or otherwise use the Online Services, or any user of a Customer Solution.” Id. at 10. Per the subscription agreement, the organization providing a domain name “may assume control over and manage [the subscriber's] use...