Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_15-cv-01370/USCOURTS-cand-5_15-cv-01370-10/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Contract Dispute

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

BLADEROOM GROUP LIMITED, et al.,

Plaintiffs,

v.

FACEBOOK, INC., et al.,

Defendants.

Case No.5:15-cv-01370-EJD (HRL)

ORDER RE DISCOVERY DISPUTE 

JOINT REPORT NO. 4

Re: Dkt. Nos. 157, 158

In Discovery Dispute Joint Report (DDJR) #4, the plaintiffs (BladeRoom Group Limited 

and Bripco (UK) Limited) seek an order requiring the Emerson defendants (Emerson Electric Co. 

Emerson Network Power Solutions, Inc., and Liebert Corporation) to make a wholesale dedesignation of documents they produced marked “Attorneys’ Eyes Only” (AEO). Plaintiffs urge 

the court to conclude that, excluding financial documents, any Emerson document more than two 

years old simply does not qualify to be marked AEO. Plaintiffs also want the same treatment for 

newer Emerson documents, although they would permit additional exceptions. The Emerson 

defendants insist that challenges to an AEO designation should be made individually, document 

by document, an approach plaintiffs have refused to take.

As is typical in a case about sensitive proprietary information, all parties agreed to, and the 

court accepted, a Stipulated Protective Order (“Order”). (Dkt. #54, 118). In pertinent part, the 

Order allowed parties, when producing information in discovery, to designate as AEO “extremely 

Case 5:15-cv-01370-EJD Document 237 Filed 03/16/17 Page 1 of 3
2

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

sensitive ‘Confidential Information or Items,’ disclosure of which to another Party or Non-Party 

would create a substantial risk of serious harm that could not be avoided by less restrictive 

means.” (Dkt. 54 ¶ 2.8). Each party was enjoined to take care and exercise restraint so as to not 

place a higher level of protection on a document than it actually warranted. (Id. ¶ 5.1). AEO 

documents could only be disclosed to two Designated House Counsel of the receiving party. 

(This was to wall off competitive information from the adversary’s decision makers.) And, even 

the two Designated House Counsel must have a need to know and not be involved in competitive 

decision making. (Id. ¶ 7.3). The Order established a protocol for challenging AEO designations 

(i.e., claiming a de-designation is warranted) which began with the parties meeting and conferring 

over each questioned document. (Id. ¶ 7.5). It is undisputed that the Order contemplates the 

review will take place document by document.

Plaintiffs say that a document by document review is “plainly unworkable” because there 

are just too many AEO documents. Plaintiffs tell the court that the Emerson defendants produced 

nearly 68,000 documents and fully 82% were designated AEO, arguing that no one could 

plausibly assert that 82% of their documents were AEO. What they do not say is how many (and 

which ones) they think are not worthy of the AEO designation. None of them? The court notes 

that, according to the Emerson defendants, the plaintiffs designated 94% of their document 

production as AEO. The court has trouble concluding that a high percentage of AEO documents 

must mean that there is a high degree of over-designation.

To buttress their argument, plaintiffs move for leave to file 13 exhibits. These are 

described as “examples” of the Emerson defendants’ over-designation of AEO. The Emerson 

defendants object to the motion on the quite reasonable ground that some of these exhibits were 

not part of the dialog between counsel that led up to the drafting and submission of this DDJR, 

that they have not had a chance to weigh in on them, and that---in any event---this DDJR is not 

about de-designating these 13 documents. The court overrules the objection and grants the 

motion.

As for the 13 exhibits, some did raise questions in the court’s mind; and, the Emerson 

defendants now advise that 5 of those 13 exhibits were incorrectly marked “AEO” and should not 

Case 5:15-cv-01370-EJD Document 237 Filed 03/16/17 Page 2 of 3
3

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

Northern District of California

have any confidentiality designation. (Dkt. 160). Even so, the court does not reach the conclusion 

that plaintiffs urge. None of the remaining 8 exhibits are so obviously over-designated that the 

court would accept plaintiffs’ word for it. If this DDJR was about reviewing and possibly dedesignating some of these after the requisite meet and confer process had been fully explored, that 

would be different. But, that is not why they are offered.

Putting aside that defendants now say 5 of the exhibits are not confidential, these 13 

exhibits, carefully chosen no doubt, represent a .0002% sample of the Emerson defendants’ AEO 

documents. Even if, arguendo, all 13 looked at first blush as if they were over-designated, the 

sample is much too small to support an inference that there is wholesale over-designation.

Furthermore, plaintiffs’ proposed remedy is draconian. Instead of looking at whether an 

AEO document contains information warranting such a high degree of protection, plaintiffs want 

the court to impose a metric that is based on the date on the document. If the document is over 

two years old, it is (unless it contained financial information) not AEO. Period. If less than two 

years old, it also is not AEO (unless it has financial information, prospective customer contacts, or 

design trade secrets).

The court is unwilling to reach the conclusion that such a remedy would actually address 

the claimed over-designation problem. Rather, the remedy simply does away with the Order’s 

definition of AEO and substitutes a new one (date on the document). How can the court with

confidence say a document over two years old cannot be AEO? Or, that a more recent document 

cannot be designated AEO unless it meets some vague exception? This will not work. Indeed, if 

the court imposed this remedy, one can imagine the disputes that would arise over whether a 

document did or did not fit one of the exceptions that would allow it to be stamped AEO.

Plaintiffs’ request for an order de-designating the Emerson defendants’ AEO documents on 

the basis of their date is denied.

SO ORDERED.

Dated: March 16, 2017

HOWARD R. LLOYD

United States Magistrate Judge

Case 5:15-cv-01370-EJD Document 237 Filed 03/16/17 Page 3 of 3