Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_17-cv-00843/USCOURTS-casd-3_17-cv-00843-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 15:1125(a) False representation of goods sold in interstate commerce

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17-CV-843-WQH-WVG

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

NUTRITION DISTRIBUTION LLC, an 

Arizona Limited Liability Company,

Plaintiff,

v.

NATHAN DEGRAVE, an individual 

d/b/a POWERSUPPS, et al,

Defendants.

Case No.: 17-CV-843-WQH-WVG

ORDER GRANTING MOTION TO 

CONDUCT DISCOVERY ON 

DAMAGES

[ECF NO. 6]

I. INTRODUCTION

Presently before the Court is Plaintiff Nutrition Distribution LLC’s ex parte Motion 

to Conduct Discovery on Damages. (ECF No. 6.) Defendants did not file an Opposition to 

the Motion. For the reasons that follow, Plaintiff’s Motion is GRANTED.

II. BACKGROUND

On April 25, 2017, Plaintiff filed a Complaint alleging the false advertising of 

Defendant’s prohormone products in violation of the Lanham Act, 15 U.S.C. § 

1125(a)(1)(B). (ECF No. 1.) On June 5, 2017, the Clerk of the Court entered an Entry of 

Default against Defendants based on their failure to plead or otherwise defend in this action 

as directed by the Summons and as provided for by the Federal Rules of Civil Procedure. 

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(ECF No. 5.) Plaintiff now seeks leave to conduct discovery on the limited issue of 

damages pursuant to the Entry of Default.

II. LEGAL STANDARD

The scope and limitations of discovery are set forth by the Federal Rules of Civil 

Procedure. Rule 26 provides in pertinent part that:

Unless otherwise limited by court order, the scope of discovery 

is as follows: Parties may obtain discovery regarding any 

nonprivileged matter that is relevant 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 

controversy, the parties' relative access to relevant information, 

the parties' resources, the importance of the discovery in 

resolving the issues, and whether the burden or expense of the 

proposed discovery outweighs its likely benefit. Information 

within this scope of discovery need not be admissible in evidence 

to be discoverable.

Fed. R. Civ. P. 26(b)(1).

District courts have broad discretion in granting or denying discovery. Hallett v. 

Morgan, 296 F.3d 732, 751 (9th Cir. 2002) (“broad discretion is vested in the trial court to 

permit or deny discovery, and its decision to deny discovery will not be disturbed except 

upon the clearest showing that denial of discovery results in actual and substantial prejudice 

to the complaining litigant”).

Generally, Rule 26(d)(1) provides that “[a] party may not seek discovery from any 

source before the parties have conferred as required by Rule 26(f), except ... when 

authorized by these rules, by stipulation, or by court order.” Fed. R. Civ. P. 26(d). Courts 

apply a “good cause” standard in considering motions to expedite discovery. Semitool, Inc. 

v. Tokyo Electron Am., Inc., 208 F.R.D. 273, 276 (N.D. Cal. 2002); see also Am. LegalNet, 

Inc. v. Davis, 673 F. Supp. 2d 1063, 1066 (C.D. Cal. 2009); In re Countrywide Fin.Corp. 

Derivative Litig., 542 F. Supp. 2d 1160, 1179 (C.D. Cal. 2008). Good cause may be found 

where the need for expedited discovery, in consideration of the administration of justice, 

outweighs the prejudice to the responding party. Semitool, 208 F.R.D. at 276.

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Good cause for expedited discovery is frequently found in cases in cases where a 

defendant has failed to appear, resulting in the entry of default against the defendant, and 

the plaintiff is in need of evidence to establish damages. See Sheridan v. Oak Street Mortg., 

LLC, 244 F.R.D. 520, 522 (E.D. Wis. 2007); Twitch Interactive, Inc. v. Johnston, No. 16-

CV-03404, 2017 WL 1133520, at *4 (N.D. Cal. 2017); Adobe Sys. Inc. v. Max Bunhey, et 

al., No. 131365, 2013 WL 12140304, at *2 (C.D. Cal. Oct. 29, 2013).

On June 5, 2017, default was entered against Defendants for failing to plead or 

otherwise defend in this action. Plaintiff claims, and the Court agrees, a plaintiff may 

recover defendant’s profits, any damages sustained, and the costs of the action in false 

advertisement claims made pursuant to the Lanham Act. See 15 U.S.C. § 1117(a). In this 

Motion, Plaintiff seeks discovery from payment gateway services and financial institutions 

of Defendants, one of which is Paypal. (ECF No. 6-1 at 3:18-4:2.) However, since 

Defendants have refused to participate in this action, Plaintiff cannot conduct traditional 

discovery.

Accordingly, the Court finds that Plaintiff has established good cause to warrant 

expedited discovery in this matter in order to support an anticipated motion for entry of 

default judgment and claim for damages. Semitool, Inc., 208 F.R.D. at 276.

IV. CONCLUSION

Based on the foregoing, the Court GRANTS Plaintiff’s ex parte Motion. Plaintiff 

may seek immediate discovery of information sufficient to identify Defendants’ profits 

derived from sales of prohormone products from Defendants’ electronic gateway services 

and financial institutions (“Third-Party Entities”).

It is further ORDERED that Plaintiff must serve a copy of this order on Third-Party 

Entities when discovery is served. Third-Party Entities that wish to file a motion to quash 

a subpoena or to serve objections, must do so before the return date of the subpoena, which 

shall be no less than twenty-one (21) days from the date of service of the subpoena. The 

Third-Party Entity may use this time to attempt to notify the subscriber in question. ThirdParty Entities shall preserve any subpoenaed information or materials pending compliance 

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with the subpoena or resolution of any timely objection or motion to quash.

IT IS SO ORDERED.

Dated: September 7, 2017

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