Case 4:19-cv-04060-JST Document 74 Filed 06/16/20 Page 1 of 7

JENNIFER LEE TAYLOR (CA SBN 161368)
JTaylor@mofo.com
NICHOLAS HERRERA (CA SBN 301992)
NHerrera@mofo.com
ROBERT S. SANDOVAL (CA SBN 311032)
RSandoval@mofo.com
MORRISON & FOERSTER LLP
425 Market Street
San Francisco, California 94105-2482
Telephone: 415.268.7000
Facsimile: 415.268.7522
Attorneys for Plaintiff
LAMBDA LABS, INC.

RIMON, P.C.
Karineh Khachatourian (SBN 202634)
karinehk@rimonlaw.com
Nikolaus A. Woloszczuk (SBN 286633)
nikolaus.woloszczuk@rimonlaw.com
2479 E. Bayshore Road, Suite 210
Palo Alto, California 94303
Telephone: 650.461.4433
Facsimile: 650.461.4433
Attorneys for Defendant,
LAMBDA INC.

UNITED STATES DISTRICT COURTNORTHERN DISTRICT OF CALIFORNIASAN FRANCISCO DIVISIONLAMBDA LABS, INC.,
Plaintiff,v.
LAMBDA, INC.,

Case No. 4:19-cv-04060-JST (TSH)
JOINT LETTER BRIEF REGARDING
THE PRESERVATION OF CERTAINDATA SOURCES
Judge:

Magistrate Judge Thomas S. Hixson

Defendant.

Per the Court’s Order (ECF No. 69), the Parties submit this joint letter brief concerning
the preservation of certain data sources. The parties met and conferred by telephone in goodfaith to resolve their disputes prior to filing this letter.
Morrison & Foerster LLP

Rimon, P.C.

By: /s/ Jennifer Lee Taylor
Jennifer Lee Taylor
Nicholas Herrera
Robert S. Sandoval

By: /s/ Karineh Khachatourian
Karineh Khachatourian
Nikolaus A. Woloszczuk

Attorneys for Plaintiff,
LAMBDA LABS, INC.

Attorneys for Defendant,
LAMBDA INC.

JOINT LETTER BRIEF RE: PRESERVATION OF DATA SOURCES; CASE NO. 4:19-CV-04060-JST (TSH)Case 4:19-cv-04060-JST Document 74 Filed 06/16/20 Page 2 of 7

Lambda Labs’ Position
Lambda School seeks to be excused from continuing to preserve certain categories ofpotentially relevant documents—based on its offer to preserve documents from one person per
category. Its offer is insufficient. While the parties may later agree to limit production to one
custodian for given categories, preservation must be broader and should include everyone who
may possess relevant materials.1 Importantly, Lambda School has not identified any burden topreserving these materials—not in response to Lambda Labs’ repeated questions during meet andconfer, and not in this brief. Indeed, it cannot because Lambda School has represented that its
general policy is not to delete documents even apart from formal litigation holds.2
Lambda School specifically objects to preserving documents in the following categories3
based on relevance, but offers no authority—during the parties’ meet and confer, or below—thata party may refuse to preserve materials simply because it might object to producing them later.
The Court should order Lambda School to preserve all potentially relevant documents in thefollowing categories.4
1. Voicemails. Lambda Labs thought this issue was resolved in meet and confer, andaddresses it only because Lambda School raises it below. For clarity, Lambda Labs has
not asked Lambda School to preserve every voicemail in its system, but rather asked it topreserve documents of individuals who are likely to have relevant materials, withvoicemails being one type of document. Lambda School explained during meet andconfer that it is already preserving those voicemails because its employees receive copies
of voicemail messages as emails, which are being preserved. Thus, there should be nodispute regarding voicemails and no reason to discuss preservation within its Ringcentral
system. However, Lambda School claimed for the first time this afternoon that thevoicemails found in its email inboxes are not “reasonably accessible.” But any concerns
it may have about accessibility, document review, and ESI storage costs is not pertinent
1

Otherwise, the “safety net” of additional custodians that the Court advised the parties to include
would be meaningless, because Lambda School will not be able to produce documents that are
not preserved.

2

Lambda School added vague complaints about the scope of Lambda Labs’ preservation efforts
to its portion of this brief just as it was being finalized for filing—far too late for Lambda Labs toaddress them. To the extent Lambda School has genuine concerns regarding the scope ofLambda Labs’ preservation efforts, Lambda School is willing to meet and confer about them.
3

Despite weeks of meeting and conferring regarding document preservation and ESI issues,
Lambda School shifted its position on numerous issues this afternoon. But it did not explain
what it was agreeing to do; instead, it deleted sections from the draft and stated that “there is nodispute” on certain issues. Lambda Labs followed up to confirm the scope of what it believes tobe the agreement. For avoidance of doubt, Lambda Labs identifies those issues and the scope ofwhat it believes Lambda School agreed to do in this brief to give Lambda School the opportunity
to state any disagreements for the Court.
4

Lambda Labs offers brief explanations on relevance to provide the Court with context, but does
not believe relevance can excuse a party from preserving documents in the absence of burden.

1
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to this brief, which merely addresses preservation. Such concerns are also not ripe
because they were raised for this first time this afternoon and have not been addressed inmeet and confer.5
2. Student outcome reports. Lambda School publishes occasional “student outcome
reports” regarding its student graduation rates, employment prospects, and so on. These
reports have generated significant controversy because press accounts earlier this year
suggested Lambda School inflated or falsified its student employment data. This
controversy bears directly on the harm Lambda School is causing to Lambda Labs’
trademark goodwill. Lambda Labs is regularly confused with Lambda School, including
online. Thus, negative press associated with Lambda School is likely to affect the
goodwill in the “Lambda” name, which will reflect poorly on both Lambda School andLambda Labs because they are confused. Lambda Labs asked Lambda School topreserve all documents related to its student outcome reports, including the underlying
data and drafts. Lambda School objects that they are not relevant, but that objection does
not excuse it from preserving documents.
3. Complaints by Lambda School students and employees. Lambda School has also been
the subject of frequent complaints from students and employees regarding the quality ofits services, which have led to negative press attention and further affect the goodwill in
the “Lambda” name. Lambda School argues these documents are not relevant, and theparties will file a joint letter brief on this topic on June 26. Until then, Lambda School
should preserve all materials related to such complaints.
4. Trademark filings and discussions thereof. Lambda School confirmed this afternoon that
it will preserve all materials on this topic. (See ECF No. 62 at 10 n.4 (noting Lambda
School’s previous failure to respond).).
5. Lambda School’s “Lambda Labs” program. Lambda School confirmed this afternoon
that it will preserve all materials on this topic. (Id.)
6. Lambda School’s use of the “Red Lambda” marks. Lambda School confirmed thisafternoon that it will preserve all materials on this topic. (Id.)
7. Lambda School’s acquisition of the “Red Lambda” marks. Lambda School confirmed
this afternoon that it will preserve all materials on this topic. (Id.)
8. Confirmation regarding other categories. Lambda Labs requested preservation of
documents related to (a) press and media coverage, (b) various business functions(product, marketing/promotions/public relations, and investments and funding), and (c)career planning and student placement. Lambda Labs believed Lambda School waspreserving these documents, but received no response when it tried to confirm. Lambda
5Apple Inc. v. Samsung Elecs. Co., 2012 WL 10817203 (N.D. Cal. Jan. 30, 2012), is inapposite
because the parties agreed voicemail discovery was not necessary for the patent claims at issue.
(Id. at 14.) In contrast, voicemails and phone recordings can be key evidence of confusion intrademark cases. In fact, Lambda Labs has received and will produce phone messages from
confused Lambda School students who have contacted Lambda Labs thinking it was their school.
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School states below for the first time that it will not preserve these documents beyond“what it has already done,” which is an entirely unclear statement. It should be ordered
to continue to preserve documents in these three subcategories.
In short, the Court should make clear that Lambda School is obligated to preserve all
potentially relevant materials, not just some. Although this brief concerns only future
preservation, Lambda School incorrectly claims Lambda Labs seeks to impose sanctions for past
failures to preserve. It also tries to shift the burden to Lambda Labs to prove that the fiveindividuals identified by Lambda School as custodians are not sufficient for purposes ofpreservation, in the same fashion it hid the ball during the meet and confer process on theappropriate number of custodians. Lambda School’s position has no legal support and makes nosense: it is the responding party, not the requesting party, who must identify documents that need
to be preserved because it has the information to do so. Finally, Lambda School’s claim that it
only recently learned that items like student complaints and negative press attention wererelevant to this case is undercut by the Complaint in this case, which put it on notice as early as
July 15, 2019. (ECF No. 1 ¶ 42 (“Lambda [Labs] may also be harmed by a mistaken association
with Defendant due to controversy surrounding Defendant’s business practices . . . .”).)
Lambda School’s Position
This preservation dispute arose out of the parties’ attempts to finalize an ESI stipulation.
Specifically, Paragraph 4(f) of the Model Order provides: “The parties have discussed theirpreservation obligations and needs and agree that preservation of potentially relevant ESI will bereasonable and proportionate. To reduce the costs and burdens of preservation and to ensure
proper ESI is preserved, the parties agree that: …. data from these sources (a) could containrelevant information but (b) under the proportionality factors, should not be preserved. Further,
the Model ESI Stipulation contemplates that voicemails are not reasonably accessible. Paragraph4( e) “Among the sources of data the parties agree are not reasonably accessible, the parties
agree not to preserve…voicemail.” Labs does not dispute this. Rather, it ignores that a
discussion of preservation must include proportionality, reasonable accessibility and the factors
enumerated pursuant to Federal Rule 26(b)(1) and 26(b)(2)(B). And the parties both have ashared responsibility to ensure proportionality. In light of the proportionality factors, School
proposed that the issues of preservation be deferred until the Court ruled on the parties other ESI
and discovery disputes, which would have bearing on this matter, but Labs refused. This
trademark infringement case was filed on July 15, 2019, and amended pleadings were filed in
March 2020 and April 2020. Although the parties agreed to negotiate an ESI Stipulation early
on in the case, those negotiations did not begin until April 2020. School’s problem with Labs’requests is that it seeks to impose a preservation obligation on School retroactively. To be clear,
School recognizes the importance of preservation. School has been transparent with Labs.
Given the breadth of Labs preservation requests, the vagueness of its goodwill allegations, anddisputes over relevancy, School has asked for preservation parameters to avoid future disputes,
which Labs has refused to provide. By requesting that School preserve broad sweeping
categories of documents that stretch over multiple groups, rather than particular custodians ordatasources, the burden falls more heavily on School since it is much larger than Labs. For
example, just because you file a patent infringement suit over a widget, this does not mean you
institute a legal hold over your entire engineering department. That is what Labs is asking School
to do. Having a safety valve of custodians to be named later is not enough to justify broad
3
JOINT LETTER BRIEF RE: PRESERVATION OF DATA SOURCES; CASE NO. 4:19-CV-04060-JST (TSH)Case 4:19-cv-04060-JST Document 74 Filed 06/16/20 Page 5 of 7preservation requests. School will continue to follow its practice of retaining ESI, however it
wishes to avoid an ongoing preservation obligation for remote individuals and datasources tosave on ESI and archiving costs, and avoid future disputes. If as Labs says, it is up to the
responding party to identify sources to preserve, then there should be no dispute here. Labs says
it has preserved everything School has requested, but (1) School did not request preservation ofbroad sweeping categories of documents that extend over multiple departments and (2) Labs has
never disclosed what preservation efforts it has taken. As of the filing of this letter, Labs still has
not provided a list of its data sources or potential custodians. The problem is that Labs will notconfirm that instituting a legal hold of the individuals and datasources most likely to containrelevant information is enough. While School did impose a legal hold on the datasources andindividuals most relevant to the issues raised in the complaint in July 2019, and generally its
practice is not to delete data, Labs now seeks preservation obligations on subject matter andindividuals for discovery that spans over 50 requests it did not serve until May 2020, themajority of which is not mentioned in the pleadings. The parties spent at least 14 hours meetingand conferring on the ESI stipulation. School met and conferred again on June 8, 2020. Andagain today for another two hours. Any issues raised herein were discussed with Labs at least
once during the multiple meet and confer sessions. School should not be faulted for trying tonarrow dsiputes. And during the course of these discussions, even today, Labs preservation
demands continued to change.
Labs claims that School’s additional attempts to resolve or narrow these disputes is somehow
wrong. Having reviewed Labs’ portion, issues were raised for the first time that School thought
were resolved. Even after agreement, Labs continues to complain. There is no dispute that School ispreserving data from the custodians and datasources most likely to contain information concerning
Red Lambda, the Lambda Labs program, and documents concerning its trademark applications. Thiswas made clear to Labs during multiple calls and School is surprised Labs raises it here even after
confirmation today. The remaining disputes as School understands it is that Labs request for
preservation of broad sweeping subject matter that falls on teams of individuals at School creates adisportionate preservation obligation. School’s entire IT infrastructure is cloud based and archiving
limits are set by the vendor. Some providers have additional archiving solutions if eligible, but they
are expensive. As a cloud based company, School does not independently back up its datasources.
To the extent retention is customizable, School’s default setting is to retain, not delete. Labs would
not confirm that it does not expect School to back up its data outside of the cloud. Local backups
would be time consuming and expensive, requiring individual collection on a regular basis ofmultiple custodians and datasources. Nor does Labs say how it is preserving its own data and thatsomehow what School has done is any different. School does not want to be accused of spoliation
down the road because it did not identify every single individual who may have received an email
touching on the disputed subjects, no matter how remote or duplicative.
Voicemails: Labs requests that all voicemails at School concerning various broad subject
matter be preserved regardless of custodian or datasource. Retention of voicemail is timeconsuming and costly to preserve, collect, review, and produce in litigation, supporting theargument that the information is not “reasonably accessible” under Federal Rule of Civil
Procedure 26(b)(2)(B). Given the number of proposed custodians (16) and datasources (22) thatLabs is requesting, preserving voicemail of anyone who may have touched a subject matter nomatter how remote, particularly when that subject matter has little to no relevance to the issues in
the case is not proportional. Given that voicemail may contain private and employment
4
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information of its students, some international, this will require careful review. Moreover, there
is no way to cull voicemail, so each would have to be reviewed independently. Finally,voicemail are MP3 files that are larger in datasize, which increase ESI and storage costs.
Because of these difficulties, voicemail was even excluded in the Apple/Samsung patent wars
where it was agreed to by attorneys at the same firm as Labs. Apple Inc. v. Samsung Elecs. Co.,
No. 11-CV-01846-LHK, 2012 WL 10817203, at *14 (N.D. Cal. Jan. 30, 2012). If School needs
to continue to preserve voicemail, it should be tied to a single custodian who has the bulk of theinformation for each of Labs topics beyond those custodians already identified.
Student outcome reports. School’s student outcome reports are publicly available. Labsargues that intrusive discovery into the back up for School’s student outcome reports should bepreserved because it is relevant to Labs’ harm to goodwill allegation. Labs’ request is notproportional. What is said internally at the School by its students or employees is by its very
nature, irrelevant to a loss of goodwill claim. Types of information that is relevant is Labs
expenditures in building its reputation in order to estimate the harm, evidence of Labs’ market
share loss, or evidence that Labs’ customer relationships were affected because of problems
caused by School’s educational and payment model. Second, School’s student outcome reports
are prepared by teams of individuals at School. Therefore, Labs’ request is too broad, as it seeks
to preserve data for any individual who has ever touched a student outcome report at the School.
Third, any internal back up data involves the personal and private academic and employment
information of School’s students since inception, which will require careful review and redaction
if produced. Given that the relevancy of this subject matter will be determined in a future letter
brief to be filed on June 26, 2020, School’s position is the request is premature and rulings bedeferred. However, if the Court rules that this information continue to be preserved, it should be
limited to a single custodian most likely to have the bulk of the relevant information on this
topic.
Complaints by Lambda School students and employees. For the same reasons as student
outcome reports, preserving “complaints” by School students and employees either should be
deferred or denied. Labs’ request is too broad, involves an unreasonable amount of different data
sources and custodians, and asks for sensitive student and employee private information withvery little to no relevance to this case. School should not have to preserve data that it may nothave to produce in this case. In the alternative, School should only be required to preserve froma single custodian who would most likely have the bulk of the relevant information on this topic.
Additional confirmation regarding other categories. For the same reasons discussed
above, School should not have to continue to preserve investor relations or career planning andplacement data beyond what it has already done(imposing a legal hold on those custodians anddatasources most likely to have relevant information). Teams of individuals at School work on
investor relations and career planning and placement. The same holds true for press and media
coverage (all publicly available, internal communications irrelevant or in the hands of third
parties), and marketing/promotions (all publicly available, internal communications alreadypreserved through identified custodians and datasources). School has identified its custodians,
IT infrastructure, and efforts to preserve. Nothing more should be required. If the Court
believes more is required, such burdens should be imposed on both parties, not just School.

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ATTESTATION
I, Jennifer Lee Taylor, am the ECF user whose credentials were utilized in the electronic
filing of this document. In accordance with Civil Local Rule 5-1(i)(3), I hereby attest that
Karineh Khachatourian concurred in the filing of this document.
/s/ Jennifer Lee Taylor
Jennifer Lee Taylor

6JOINT LETTER BRIEF RE: PRESERVATION OF DATA SOURCES; CASE NO. 4:19-CV-04060-JST (TSH)