Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_12-cv-00964/USCOURTS-casd-3_12-cv-00964-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 28:1331 Fed. Question

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

ERIK KNUTSON and KEVIN

LEMIEUX, Individually and on behalf

of all other similarly situated,

Plaintiffs,

v.

SCHWAN’S HOME SERVICE, INC.

and CUSTOMER ELATION, INC.,

Defendants. 

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Case No. 12cv964-GPC (DHB)

ORDER REGARDING JOINT

MOTIONS FOR

DETERMINATION OF

DISCOVERY DISPUTE

[ECF Nos. 36, 43]

Plaintiffs and Defendant Schwan’s Home Service, Inc. filed a Joint Motion for 

Determination of Discovery Dispute on February 14, 2013. (ECF No. 36.) The parties

submitted a Supplemental Joint Motion on March 12, 2013. (ECF No. 43.) After reviewing

the Joint Motions and supporting exhibits, the Court GRANTS Plaintiffs’ request to compel,

as outlined below.

I. BACKGROUND

This is a class action alleging violations of the Telephone Consumer Protection Act,

47 U.S.C. § 227, et seq. (“TCPA”). Plaintiffs seeks to represent a class of individuals who 

received calls on their cell phones from Defendant without prior express consent. Plaintiffs

have served Requests for Production and Interrogatories on Defendant seeking information

about: (1) the number of calls Defendant placed to cell phones; (2) Defendant’s evidence of

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“prior express consent;” and (3) Defendant’s insurance coverage. Defendant has objected

to the discovery requests on grounds that they are not relevant to class certification and are

unduly burdensome. In addition to briefing their dispute about these three categories of

discovery requests, the parties submitted supplemental briefing addressing two specific

requests: Plaintiffs’ Interrogatory No. 26 (Set Two) and Plaintiffs’ Request for Production

No. 28 (Set Two). Interrogatory No. 26 seeks information regarding the number of calls

Defendant made on behalf of Nutri-Systems. Request for Production No. 28 requests

Defendant’s outbound dial list and report for such calls. 

II. DISCUSSION

The threshold requirement for discoverability under the Federal Rules of Civil

Procedure is whether the information sought is “relevant to any party’s claim or defense.” 

Fed. R. Civ. P. 26(b)(1). In addition, “[f]or good cause, the court may order discovery of any

matter relevant to the subject matter involved in the action. Relevant information need not

be admissible at the trial if the discovery appears reasonably calculated to lead to the

discovery of admissible evidence.” Id. The relevance standard is thus commonly recognized

as one that is necessarily broad in scope in order “to encompass any matter that bears on, or

that reasonably could lead to other matter that could bear on, any issue that is or may be in

the case.” Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340, 351 (1978) (citing Hickman

v. Taylor, 329 U.S. 495, 501 (1947)). 

However broadly defined, relevancy is not without “ultimate and necessary

boundaries.” Hickman, 329 U.S. at 507. Accordingly, district courts have broad discretion

to determine relevancy for discovery purposes. See Hallett v. Morgan, 296 F.3d 732, 751

(9th Cir. 2002); Vonole v. Countrywide Home Loans, Inc., 571 F.3d 935, 942 (9th Cir. 2009)

(“District courts have broad discretion to control the class certification process, and

‘[w]hether or not discovery will be permitted . . . lies within the sound discretion of the trial

court.’”). District courts also have broad discretion to limit discovery. For example, a court

may limit the scope of any discovery method if it determines that “the discovery sought is

unreasonably cumulative or duplicative, or can be obtained from some other source that is

more convenient, less burdensome, or less expensive.” Fed. R. Civ. P. 26(b)(2)(C)(I).

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Generally at the pre-class certification stage, discovery in a putative class action is

limited to certification issues such as the number of class members, the existence of common

questions, typicality of claims, and the representative’s ability to represent the class. 

Oppenheimer Fund, Inc., 437 U.S. at 359. Although discovery on the merits is usually

deferred until it is certain that the case will proceed as a class action, the merits/certification

distinction is not always clear. Facts that are relevant to the class determination frequently

will overlap with those relevant to the merits of the case. See Wal-Mart Stores Inc. v. Dukes,

131 S.Ct. 2541, 2551-52 (2011) (explaining that often the “rigorous analysis” under Rule

23(a) “will entail some overlap with the merits of the plaintiff’s underlying claim. That

cannot be helped.”). 

A. Category One: Outbound Dial Lists

Plaintiffs argue Defendant should be compelled to produce its outbound dial lists and 

call reports for the dial lists. Plaintiffs assert this information is relevant to Plaintiffs’ claims

regarding outbound autodialed calls and is needed to adequately prepare a motion for class

certification. Defendant objects to producing the information. Defendant contends

Plaintiffs’ requests are overbroad and seek information that is irrelevant at this stage in the

litigation. Defendant also argues it would be unduly burdensome to produce the information

sought by Plaintiffs.

As an initial matter, the Court overrules Defendant’s objections to the extent they are

based on Defendant’s assertion that discovery has been bifurcated. The Court clarifies that

discovery is not bifurcated in this case. That being said, discovery at this pre-certification

stage should be focused on class certification issues. 

Plaintiffs argue that the outbound dial lists and reports are necessary to establish the

numerosity and ascertainability of the class. Defendant argues the information is not

relevant and not necessary at this time. Defendant states that it is willing to stipulate to the

numerosity requirement, which alleviates Plaintiffs’ need for the information. Defendant

also argues Plaintiffs don’t need the outbound dial lists to determine if it is possible to

identify specific class members. 

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The Court finds that the information sought by Plaintiffs is relevant to class

certification issues. True, it overlaps with the merits of Plaintiffs’ case. However, as the

Supreme Court recently recognized, this is not altogether uncommon in class actions. See

Wal-Mart Stores Inc. v. Dukes, 131 S.Ct. 2541, 2551-52 (2011). The Court finds it is likely

the outbound dial lists and reports will illuminate issues such as the number and

ascertainability of potential class members, the typicality of their claims, and whether

common questions of law or fact exist, thus making the class action device appropriate in

this case. See Mantolete v. Bolger, 767 F.2d 1416, 1424 (9th Cir. 1985) (pre-certification

discovery should be allowed if it is likely to substantiate the class allegations). Although

Defendant offers to stipulate to the numerosity requirement, the Court notes that the

proffered stipulation1

 does not include the ascertainability requirement. Also, the Court

notes it may be helpful for Plaintiffs to be able to articulate in their motion for class

certification how large, or small, the proposed class is expected to be. This information may

also be relevant to issues such as manageability. 

Defendant also objects that producing the outbound dial lists and reports would be

burdensome. Defendant states that Plaintiffs are requesting information about an estimated

3.9 million phone calls nationwide, and that many of the calls would have been placed to

landlines. Plaintiffs suggest that it would not require an unreasonable number of hours or

cause undue expense for Defendant to determine the number of calls placed to cell phones

using an autodialer. Plaintiffs state that if necessary, they have a consultant who can review

the outbound dial lists, and in a matter of weeks perform a “cell phone scrub” to determine

which calls are actionable, as long as Defendant produces the information in an searchable

electronic format. See ECF No. 36-1 at ¶¶7-8.

On balance, the Court finds that the outbound dial lists and reports are relevant at this

stage of the litigation, and should be produced in a searchable electronic format. If the

parties determine a protective order should be in place before the information is produced,

1

Defendant also qualifies the proposed stipulation. See ECF No. 43 at 17, n. 27.

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the Court is willing to entertain a joint motion for a protective order.2 Accordingly,

Plaintiffs’ request to compel production of outbound dial lists and reports is GRANTED. 

B. Category Two: Evidence of “Prior Express Consent”

Plaintiffs have requested information relating to Defendant’s affirmative defense of

“prior express consent.” Plaintiffs predict Defendant will assert this defense in opposition

to class certification. Plaintiffs argue they will need the information to prepare a response

and to demonstrate that the putative class is both ascertainable and manageable. Plaintiffs

note that similar discovery has been permitted by other district courts in TCPA cases. See

e.g. Donnelly v. NCO Financial Systems, Inc., 263 F.R.D. 500, 505 (N.D. Ill. 2009) (ordering

the defendant in a TCPA class action to produce “class-wide documents and information

relating to its prior express consent defense” prior to the resolution of the plaintiffs’ class

certification motion). Defendant counters that compiling the information would be

extremely burdensome and the information is not necessary at this stage in the litigation. 

The Court finds the information sought by Plaintiffs is relevant. “Prior express

consent” is an affirmative defense that defendants in TCPA cases have the burden to prove. 

See e.g. 23 F.C.C.R. 559, 565 (Jan. 4, 2008); Grant v. Capital Mgmt Servs.,LP, 449

Fed.Appx. 598, 600 n.1 (9th Cir. 2001) (noting that “‘express consent’ is not an element of

a TCPA plaintiff’s prima facie case, but rather is an affirmative defense for which the

defendant bears the burden of proof.”); Connelly v. Hilton Grant Vacations Co., LLC, 2012

WL 2129364, *3 (S.D. Cal. June 11, 2012). As this defense is likely to be raised as an issue

in the certification proceedings, the Court finds Plaintiffs’ discovery requests are appropriate. 

Defendant contends that compelling this discovery is tantamount to the Court ruling the class

is ascertainable. The Court disagrees. The issue before the Court is whether Plaintiffs’

discovery requests are relevant to factors bearing on certification, such as ascertainability;

not whether the class is, in fact, ascertainable.

Defendant argues it would be unduly burdensome, if not impossible, to produce the

2

 The parties should consult Judge Bartick’s chambers rules for more information on the Court’s

requirements for all protective orders. Judge Bartick’s chambers rules are available on the Court’s

website at: www.casd.uscourts.gov.

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information requested by Plaintiffs. Defendant estimates that it would take 15 years to

complete even a cursory review of the documentation evidencing each customer’s prior

express consent. Defendant states that its 3.9 million customers consented to receiving

prerecorded calls in numerous ways, including by email, through the company’s website,

over the telephone, and verbally to their Route Sales Representatives at their front door. 

Defendant says that it did not start recording its customers’ manner of consenting to

prerecorded calls in a computer database until November 2012. Plaintiffs ask that at a

minimum, Defendant should be compelled to produce the records it kept electronically since

November 2012.

The Court appreciates that reviewing and producing the volume of information

requested by Plaintiffs at this stage in the litigation is burdensome. The question, of course,

is whether that burden is undue. The Court notes that Defendant proposed a middle-ground. 

Defendant suggested a sampling procedure, which was apparently rebuffed by Plaintiffs.

With respect to records kept prior to November 2012, the Court finds that sampling strikes

an appropriate compromise in this case. See Soto v. Castlerock Farming and Transport, Inc.,

282 F.R.D. 492, *503-04 (E.D. Cal. April 30, 2012) (“To relieve the burden on a party, a

court may order a ‘sampling’ of records.”); Feske v. MHC Thousand Trails Ltd. Partnership,

2012 WL 1123587, *2 (N.D. Cal. April 3, 2012) (“[I]n the specific context of class-action

discovery, sampling advances the goal of proportionality set forth in Fed.R.Civ.P.

26(b)(3)(c)(iii).”). Sampling should afford Plaintiffs sufficient information for their class

certification motion, and will not overburden Defendant. With respect to records kept after

November 2012, the Court finds that Defendant should produce all of the electronic records

of express consent it has kept within its computer database. While still time consuming, the

effort associated with producing electronically stored information is not as great as that

required to produce the information that is not in a computer database. 

/ / /

/ / /

/ / /

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Accordingly, Plaintiffs’ request to compel evidence of “prior express consent” is

GRANTED as follows:

1. The parties shall meet and confer and devise a mutually agreeable random

sampling procedure for records evidencing “prior express consent” for the

period from April 2008 through November 2012; and 

2. Defendant shall produce all responsive records evidencing “prior express

consent” that are available in its computer database since November 2012. 

C. Category Three: Insurance Coverage

Plaintiffs seek to compel Defendant to produce evidence of its insurance coverage.

Plaintiffs contend Defendant referenced an insurance agreement in the Master Services

Agreement, but has failed to proved Plaintiffs with a copy of the policy. The Master

Services Agreement was provided to Plaintiffs during discovery. It is apparently an

agreement between Defendant and CustomerElation, a third party vendor and recently added

Co-Defendant. Plaintiffs assert the information is relevant and discoverable, as the insurance

agreement may cover Defendant’s alleged violations of the TCPA. Defendant counters that

it has no insurance policy to produce, and that it is self-insured. Defendant explains that the

Master Services Agreement placed a duty on CustomerElation to obtain certain insurance

coverage. 

In light of Defendant’s representations, it appears there is no insurance policy to

compel production of. However, to the extent Defendant may have a copy of any insurance

policies held by CustomerElation pursuant to the Master Services Agreement, Defendant

should provide those documents to Plaintiffs. Accordingly, the Court finds Plaintiffs’

request to compel production of insurance coverage is GRANTED, to the extent Defendant

has any insurance policies in its possession.

D. Plaintiffs’ Interrogatory No. 26 (Set Two)

Plaintiffs’ Interrogatory No. 26 requests Defendant to state the number of telephone

numbers Defendant called “in regards to any issues related to delivering good/s and/or

product/s for [or] on behalf of Nutrisystem[].” (ECF No. 43 at 3.) Defendant objected to the

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interrogatory, stating it would be unduly burdensome to respond. The parties met and

conferred regarding the issue, and reached a compromise: Defendant agreed to admit to a

certain number of calls made on behalf of Nutri-System. Defendant was supposed to provide

this information by approximately March 7, 2013. Plaintiffs contend Defendant has not kept

its end of the bargain. (ECF No. 453 at 2, n.1.) Defendant states that it intends to honor the

compromise and has no objection to a court order compelling it to do so.

Accordingly, Plaintiffs’ request to compel Defendant to provide a supplemental

response to Interrogatory No. 26 is GRANTED. 

E. Plaintiffs’ Request for Production No. 28 (Set Two)

Plaintiffs’ Request for Production No. 28 requests Defendant’s outbound dial list and

report of telephone numbers called by Defendant on behalf of Nutri-System only. Plaintiffs

contend they need this information to support their class certification motion and to establish

factors such as numerosity, ascertainability, and predominance. Defendant objects to the

request. Defendant states that the outbound dial lists do not differentiate between Schwan’s

customers and Nutri-Systems customers assigned to the same routes. Therefore, Defendant

surmises the information will not help Plaintiffs. However, Defendant’s briefing seems to

suggest that the company has some way to distinguish between Schwan’s and Nutri-Systems

customers. Defendant states “Schwan’s delivered NutriSystem products to Plaintiffs on

behalf of NutriSystem and then inadvertently failed to scrub Plaintiffs’ names and telephone

numbers from its calling lists after they stopped receiving delivery of NutriSystem products

from Schwan’s.” ECF No. 36 at 12, n.24. In the Court’s view, this statement suggests that

it may be possible for the call lists to be scrubbed on the basis of the type of products that

were delivered. Therefore, the Court finds Defendant should provide the requested outbound

dial list and report to the extent Defendant is able to do so.

For the reasons discussed above, the Court finds the outbound dial lists and reports are

relevant to class certification issues, and the likely benefit of production outweighs the

burden of producing the material. Accordingly, the Plaintiffs’ request to compel production

of documents responsive to Request for Production No. 28 is GRANTED. 

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III. CONCLUSION

For the foregoing reasons, the Court HEREBY ORDERS Defendant to provide

supplemental responses to Plaintiffs’ Interrogatories and Requests for Production, in

accordance with the terms of this order, within 30 days of the date of this order. 

IT IS SO ORDERED.

DATED: March 25, 2013

DAVID H. BARTICK

United States Magistrate Judge

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