Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_04-cv-02935/USCOURTS-cand-3_04-cv-02935-3/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1125 Trademark Infringement (Lanham Act)

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United States District Court

For the Northern District of California

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1

 Plaintiffs submitted their brief on April 22, 2005; defendants submitted their opposition on April 30,

2005; and plaintiffs filed their reply on June 9, 2005. Defendants also submitted a follow-up letter on June 9,

2005. The Court considers all of these submissions in deciding this issue.

United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

ESCANNET, et. al.,

Plaintiffs,

 v.

SALVADOR CHAVEZ, et. al.,

Defendants.

 /

No. C 04-02935 SI

ORDER RE: DISCOVERY (SUBPOENA

TO WELLS FARGO BANK)

By letter briefs,1the parties have brought before the Court a dispute regarding the scope ofdefendants’

March 14, 2005 subpoena duces tecum directed to Wells Fargo Bank, N.A. 

On March 14, 2005, defendants subpoenaed all documents dated between January 1, 2002 and

December 31, 2002, relating to a certain Wells Fargo Bank account held by plaintiff Arthur V. Pearson. The

factual basis for the subpoena ofMr. Pearson’s personalbank account is defendants’ allegation that Escannet

was controlled by Mr. Pearson to such an extent that the principles of alter ego attach. The parties have since

agreed to limit the scope of the subpoena to all bank statements for the period between January 1, 2001 and

December 31, 2002, and all checks and deposits between July 1, 2001 and February 28, 2002. However,

plaintiffs still contend that the subpoena remains overbroad and compromises Mr. Pearson’s privacy rights.

Thus, the parties seek a ruling on the appropriate scope ofthe subpoena and dispute whether in camera review

of the documents is now appropriate.

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United States District Court

For the Northern District of California

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2

 Designation of documents as “Confidential–Attorney’s Eyes Only” is provided by the November 14,

2004 Confidentiality Order approved by this Court.

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 Defendants assert that Escannet was closed down effective November 30, 2001; plaintiffs contend

that the company continued to operate until January 2, 2002. See Defs.’ Apr. 30, 2005 Letter Br. at 2.

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1. Bank statements

Defendants seek production of Mr. Pearson’s bank statements for the period of January 1, 2001

through December 31, 2002, for in camera review. Defendants contend that the statements in this period are

relevant to whether or not Escannet had funds available forits operations based onthe representations plaintiffs

made to defendants. Plaintiffs ask the Court to limit the discovery to bank statements for the period between

July 1, 2001 and January 31, 2002, which it will produce to defendants without in camera review so long as

the documents are designated “Confidential–Attorney’s Eyes Only.”2 Plaintiffs contend that bank statements

priorto July 1, 2001, are irrelevant to the claim ofmisrepresentation offunds because the alleged representation

was made to defendants between August and October 2001, and thatbank statements after January 31, 2002,

are also irrelevant because Escannet’s operations ceased on January 2, 2002. 

The Court finds the plaintiffs’ request to limit the scope of the bank statements to the period of July 1,

2001 through January 31, 2002, to be reasonable. Bank statements fromJuly 1, 2001, willshow whether Mr.

Pearson had funds in this account based on the representations he made to defendants in August 2001.

Because Escannet ceased operations on January 2, 2002, at the latest,3statements after January 31, 2002, are

notrelevant to the issue ofwhether the company had operating funds available. The Court ORDERS plaintiffs

to produce bank statements for the period between July 1, 2001 and January 31, 2002, to defendants

designated as “Confidential–Attorney’s Eyes Only.”

2. Checks and deposits

Defendants and plaintiffs have agreed that the relevant period for checks and deposits is July 1, 2001

through February 28, 2002. Defendants request in camera review ofthese documents to determine which ones

are discoverable. Plaintiffs ask the Court to allow plaintiffs’ counsel to review all checks written on the account

for this period to determine which checks are related to the business operations of Escannet, at which point

plaintiffs will produce those checks to defendants. According to plaintiffs, the Court would be unable to
United States District Court

For the Northern District of California

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4 Defendants’ letter ofJune 9, 2005, requests all checks made payable to the following:Salvador(Sal)

Chavez, Jesse L. Yepez-Patterson (aka Jesse Patterson), Michael J. Romero, Anya Nikulina (aka Anna

Nikulina), Silkroad Software & Services, Inc. (SRS2), Daniel (Dan) Leon, Linette Zanona, Josh Sobeck,

Salesforce.com, Doug Morriss, Salesforce Automation Service, and EMC Mortgage Company.

3

determine which checks were written to or from individuals or entities doing business with Escannet. Plaintiffs

also seek to exclude deposits from the scope of the subpoena, contending that the end-of-month bank

statements are sufficient to show any deposits made into Mr. Pearson’s account. Defendants object that the

checks, as well as deposits of Escannet-related loans or revenues, are proof that Escannet is an alter ego of

Mr. Pearson. 

The Court is persuaded that plaintiffs’ counsel is in a better position to review deposits from Mr.

Pearson’s account forthe agreed-upon dates, and that in camera review would not be productive. This Court

ORDERS plaintiffs’ counseland Mr. Pearson to review Mr. Pearson’s account for the period of July 1, 2001

through February 28, 2002, and to produce: (1) all deposits related to Escannet loans or revenues, (2) all

checks that have been made payable to the list ofpayees provided in defendants’ letter ofJune 9, 2005,4 and

(3) any and all other checks that have been written on behalf of Escannet, for Escannet-related business, or

fromindividuals or entities doing business with Escannet. The Court expects that plaintiff and plaintiffs’ counsel

with be forthright and responsive in producing the above documents to defendants.

The review and production of documents must be completed on or before August 31, 2005. 

IT IS SO ORDERED.

Dated: August 23, 2005 

 

SUSAN ILLSTON

United States District Judge