Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_04-cv-03836/USCOURTS-cand-3_04-cv-03836-21/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 15:1 Antitrust Litigation

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

NSIGHT, INC.,

Plaintiff,

 vs.

PEOPLESOFT, INC.,

Defendant. /

No. 3:04 CV 3836 MMC (MEJ)

ORDER DENYING WITHOUT

PREJUDICE PLAINTIFF'S MOTION TO

COMPEL COMPLIANCE WITH NONPARTY SUBPOENA DUCES TECUM

I. INTRODUCTION

This case involves claims by plaintiff nSight, Inc. ("Plaintiff") against defendant PeopleSoft,

Inc. ("PeopleSoft") for violations of federal antitrust laws and violations of California state laws

pertaining to antitrust, unfair competition, and contracts. In the course of gathering evidence,

Plaintiff obtained a report published on PeopleSoft's website that was prepared by a third-party

market analyst, Forrester Research, Inc. ("Forrester"). Plaintiff subsequently served a non-party

subpoena duces tecum on Forrester, requesting all documents, records, and items in its possession

related to PeopleSoft's business practices during the years 1999-2004. Forrester objected to the

subpoena and, in response, Plaintiff brought a Motion to Compel Compliance With Non-Party

Subpoena Duces Tecum ("Motion to Compel"). 

II. BACKGROUND

Plaintiff, as an Independent Service Provider (ISP), entered into various consulting service

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agreements with PeopleSoft during the years 1996-2001 to perform implementation and

customization of PeopleSoft products for customer sites. Third Amended Complaint ("Complaint"),

¶ 8 and ¶ 11. Plaintiff recruited and trained engineers and technicians to work exclusively in

customizing PeopleSoft software to meet the specific needs of manufacturing and distribution

companies. Id. at ¶ 9. In 2001, Plaintiff entered into a consulting agreement with PeopleSoft, the

pre-marketing efforts of which resulted in securing a contract with distributor IMI Bevcore. Id. at ¶

20d-20e. After securing this contract, PeopleSoft, as primary vendor, took over the business for

itself. Id. at ¶ 20. IMI Bevcore subsequently purchased numerous other products and services from

PeopleSoft, all of which Plaintiff argues would likely have generated millions of dollars of

implementation business for Plaintiff. Id. at ¶ 20j. 

Plaintiff asserts that PeopleSoft misused its market power and drove smaller competitors,

including Plaintiff, out of the implementation and customization market. Id. at ¶ 23. To support this

assertion, Plaintiff obtained a report published by Forrester indicating how PeopleSoft aggressively

used its Certified Implementation Partner Program in the PeopleSoft software implementation and

customization business. Memorandum in Support of Motion to Compel Compliance With Subpoena

Duces Tecum ("Memorandum"), p. 2. Plaintiff currently seeks to substantiate the report's

conclusions by compelling Forrester, a non-party, to produce documents, records, notes, and

memoranda in its possession related to PeopleSoft's business practices during the years 1999-2004. 

Response to Objections of Forrester and PeopleSoft ("Response"), ¶ 3.

On February 9, 2006, the Clerk of Court issued a subpoena requiring Forrester to provide the

requested items to Plaintiff by February 23, 2006. Memorandum, Exhibit A. Forrester objected to

the subpoena on February 21, 2006. As a result of Forrester's objection, Plaintiff filed its Motion to

Compel on February 28, 2006. On March 23, 2006, both Forrester and PeopleSoft filed oppositions

to Plaintiff's motion. Plaintiff filed its response on April 2, 2006. 

III. DISCUSSION

 In its motion, Plaintiff argues that the documents it requests are key to its antitrust case against

PeopleSoft, and the quality of the information is such that it is unique and unavailable by any other

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means. Memorandum at 2. 

In response, Forrester argues the subpoena requires disclosure of protected research of an 

un-retained expert and that Plaintiff has not shown a substantial need for the requested information

that cannot otherwise be met without undue hardship. Forrester Research Inc.'s Opposition to

nSight, Inc.'s Motion to Compel Compliance with Non-Party Subpoena Duces Tecum ("Forrester

Opposition"), pp. 3-5. In addition, Forrester asserts that the subpoena imposes an undue burden, is

over-broad and untimely, and compliance would be futile. Id. at 5-7. 

PeopleSoft opposes Plaintiff's motion on procedural grounds, arguing the subpoena was

issued and served well after the discovery cutoff of December 30, 2005. Opposition to Plaintiff's

Motion to Compel Compliance with Non-Party Subpoena ("PeopleSoft Opposition"), p. 1. 

PeopleSoft further argues that it timely objected to subpoena on this basis and requested that

Plaintiff meet and confer on the issue, but Plaintiff refused. Id. at 1-2. It states that upon refusing,

Plaintiff asserted that the subpoena did not constitute discovery, but was instead a trial subpoena, a

position that PeopleSoft argues is meritless. Id. at 2. 

A. Legal Standard

The primary method for requesting that a non-party produce documents is by subpoena under

Federal Rule of Civil Procedure ("FRCP") 45. See Fed. R. Civ. P. 34(c) and Fed. R. Civ. P. 45. 

Rule 45 subpoenas allow a party to command a non-party to produce books, documents, or tangible

items in its possession, custody, or control. Fed. R. Civ. P. 45(a)(1)(C). If a non-party objects, the

party serving the subpoena may move to the compel compliance with the subpoena. Fed. R. Civ P.

45(c)(2)(B). In ruling on a motion to compel, a court may quash or modify the subpoena if it fails to

allow a reasonable time for compliance or subjects the non-party to an undue burden. Fed. R. Civ.

P. 45(c)(3)(A). A court may also quash or modify a subpoena if it requires disclosure of trade

secrets, confidential research, or an un-retained expert's opinion. Fed. R. Civ. Pro. 45(c)(3)(B). On

the other hand, a court may order that the non-party produce the documents if the party serving the

subpoena shows a substantial need for the material that cannot otherwise be met without undue

hardship. Fed. R. Civ. P. 45(c)(3)(B)(iii). 

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In California, federal courts interpret Rule 45 as setting forth two types of subpoenas: pretrial discovery subpoenas and trial subpoenas. See F.T.C. v. Netscape Comm. Corp., 196 F.R.D.

559, 560 (N.D. Cal. 2000); see also Integra Lifesciences I, Ltd. v. Merck KGaA, 190 F.R.D. 556, 562

(S.D. Cal. 1999). Pre-trial discovery subpoenas include, inter alia, requests for the production and

inspection and books, documents, and tangible items. See Fed. R. Civ. P. 26(a)(5) (Parties may

obtain discovery by requesting production of documents or things under Rule 45(a)(1)(C), for

inspection and other purposes). Trial subpoenas, on the other hand, include requests for attendance

at a hearing or trial, (see Fed. R. Civ. P. 45(a)(1)-(2)(A)), and may be used in narrow circumstances

to secure documents. See Puritan Inv. Corp. v. ASLL Corp., 1997 WL 793569, 1 (E.D. Pa. 1997)

(trial subpoenas may be used to secure documents at trial for the purpose of memory refreshment or

trial preparation); see also Rice v. U.S., 164 F.R.D. 556, 558 n.1 (N.D. Okla. 1995) (trial subpoenas

may be used to ensure availability at trial of original documents previously disclosed by discovery). 

California federal courts and the majority of jurisdictions hold that, absent one of the narrow

circumstances highlighted above, requests for production of documents and things under Rule 45

constitute pre-trial discovery and must be served within the designated discovery period. See

Integra Lifesciences, 190 F.R.D. at 561-62. Many courts have found that Rule 45 subpoenas sought

after the discovery cut-off are improper attempts to obtain discovery beyond the discovery period. 

See Rice v. U.S., 164 F.R.D. at 557-559 (subpoenas duces tecum for particular records, issued to

third parties after close of discovery, were quashed as improper attempt to engage in discovery after

discovery cut-off); see also F.T.C., 196 F.R.D. at 560-561. Courts have emphasized that a party's

further investigation and trial preparation after a discovery cut-off may not invoke the authority of

the court to issue a Rule 45 subpoena. See Rice, 164 F.R.D. at 558. 

B. Application to Case at Bar

Here, Plaintiff argues there is a split of authority as to whether a subpoena is discovery and,

in this case, there is a special mitigating circumstance to permit the subpoena to be enforced. 

Response at ¶ 2. Specifically, Plaintiff asserts its discovery efforts were severely hindered when it

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was not made aware for six months that a stay imposed on discovery by the Honorable Maxine M.

Chesney, the presiding judge in this matter, had automatically lifted. Id. In addition, Plaintiff

argues that it was unable to get a single document from PeopleSoft pursuant to Rule 34 requests and

this "obstruction with normal discovery procedures" by PeopleSoft was an attempt to "run out the

clock" on Plaintiff. Id. Lastly, Plaintiff argues that the documents requested by the subpoena are

needed to substantiate evidence already in its possession and that the Court should tailor an order to

help release the documents while protecting the information of Forrester. Response at ¶¶ 3-4.

The primary issue before the Court is whether Plaintiff's non-party subpoena duces tecum

constitutes pre-trial discovery. If so, Plaintiff's motion is an attempt to conduct additional discovery

after the December 30, 2005 discovery cut-off and should not be permitted. 

Plaintiff served Forrester with a subpoena duces tecum pursuant to Rule 45, requesting

Forrester to produce "all documents, records, and things, including notes, memoranda or reports

relating to PeopleSoft, Inc.'s business practices, pricing policies, customer relations, and

relationships with PeopleSoft software customization and implementation during the years 1999-

2004." Memorandum, Exhibit A. However, subpoenas requesting the production and inspection of

books, documents, and tangible items in the possession, custody, or control of another are pre-trial

discovery subpoenas. See Integra Lifesciences, 190 F.R.D. at 561-62; see also Fed. R. Civ. P.

26(a)(5) (parties may obtain discovery by requesting production of documents or things under Rule

45). Thus, in order for Plaintiff's subpoena to qualify as a trial subpoena, it must either seek a nonparty's attendance at trial or a hearing or fit within one of the narrow circumstances allowing a party

to secure documents. See Fed. R. Civ. P. 45(a)(1)-(2)(A); see also Rice v. U.S., 164 F.R.D. at 558

n.1. 

Here, Plaintiff is not requesting Forrester's attendance at trial or a hearing and is not trying to

secure original documents, the copies of which were disclosed previously during discovery. In

addition, Plaintiff is not seeking the documents and items for the purpose of memory refreshment or

for permissible use at trial. Plaintiff instead seeks to obtain documents and records it could have

requested during the discovery period. A party may not use a trial subpoena to secure documents

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involving information known to them during discovery. See Puritan Inv. Corp., 1997 WL 793569 at 

2 (citing McNerney v. Archer Daniels Midland Co., 164 F.R.D. 584, 588 (W.D. N.Y. 1995)); see

also Ghandi v. Police Dept. of City of Detroit, 747 F.2d 338, 354-355 (6th Cir. 1984) (affirming

district court's decision to quash subpoena issued on the eve of trial seeking documents available

during discovery). Plaintiff argues that its allegations against PeopleSoft are based in part on the

report released by Forrester that was published on PeopleSoft's website. Memorandum at 2. 

However, Plaintiff filed its most recent complaint containing these allegations on August 8, 2005,

long before the discovery cut-off of December 30, 2005. See Complaint at 17. Since Plaintiff was

in possession of the report during discovery and based its allegations on this report, the information

Plaintiff seeks was known to it during the discovery period. As such, it appears Plaintiff is

improperly attempting to obtain additional discovery after the discovery cut-off. See Rice v. U.S.,

164 F.R.D. at 557-559 (subpoenas duces tecum issued after close of discovery were quashed as

improper attempt to engage in discovery after discovery time period). Plaintiff seeks the authority of

the Court to engage in what the Court finds to be post-discovery case investigation. However, using

the Court's subpoena power for this purpose is improper. See Rice, 164 F.R.D. at 557-559 (a party's

further investigation and trial preparation after a discovery cut-off may not invoke the authority of a

court to issue a Rule 45 subpoena). Accordingly, the Court finds that Plaintiff's subpoena duces

tecum constitutes pre-trial discovery and is, therefore, untimely. 

Because the undersigned finds Plaintiff is attempting to conduct additional discovery after

the discovery cut-off, the undersigned is precluded from ruling on Plaintiff's Motion to Compel. 

Instead, Plaintiff must file a request before Judge Chesney, the presiding judge in this matter, to

extend the discovery time period pursuant to Civil Local Rule 6. Accordingly, Plaintiff's Motion to

Compel is DENIED WITHOUT PREJUDICE. As Plaintiff fails to show good cause to extend the

discovery cut-off, the undersigned recommends that Judge Chesney deny any request to extend

discovery for this purpose. 

IV. CONCLUSION

Based on the foregoing analysis, the Court hereby ORDERS as follows:

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1) Plaintiff's Motion to Compel Compliance With Non-Party Subpoena Duces Tecum is

DENIED WITHOUT PREJUDICE; and

2) Plaintiff must file a request before Judge Chesney to extend the discovery time period

pursuant to Civil Local Rule 6. 

As Plaintiff fails to show good cause to extend the discovery cut-off, the undersigned

RECOMMENDS that Judge Chesney deny any request to extend discovery for this purpose. 

IT IS SO ORDERED.

Dated: April 13, 2006 

MARIA-ELENA JAMES

United States Magistrate Judge

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