2013-00153788-CU-CO

VSP Labs, Inc. vs. Pro Fit Optix, Inc.

Nature of Proceeding: Motion to Compel Further Responses to Request for Production of

Filed By: Amaral, Annie S.

Plaintiff VSP Labs, Inc.’s (“VSP”) motion to compel defendant Pro Fit Optix, Inc.’s (“PFO”) further responses to Requests for Production, Set Five, is ruled on as follows.

*** If oral argument is requested, the parties must at the time oral argument is requested notify the clerk and opposing counsel of the specific discovery requests that will be addressed at the hearing. Counsel are also reminded that pursuant to local court rules, only limited oral argument is permitted on law and motion matters. ***

Moving counsel failed to comply with CRC Rule 3.1345(c) inasmuch as the moving separate statement failed to include the definitions of various terms used in the underlying discovery requests and Rule 3.1345(c) clearly requires the separate statement to include all information necessary to understand each discovery request without the need to review any other document. Moving counsel is advised that the failure to comply with all applicable Rules of Court may result in future motions being stricken or denied.

Factual Background

In 2012 VSP entered into a four-year Technology Transfer and Development Agreement (the “TTDA”) with PFO, an optical technology company, relating to the latter’s development of eyewear measurement technology for optometrists. This was referred to as the “otto” project, standing for “one touch to optical.” In exchange for PFO’s sale and continuous development of its technology in accordance with the

agreement, VSP would pay PFO a total of $6 Million at various intervals. The TTDA provided that if PFO did not fulfill, “to VSP’s satisfaction, certain milestones within thirty days of the agreed-upon deadlines, PFO would be deemed in material breach of the agreement. The TTDA also granted VSP a “Step-In Right” upon occurrence of a specified “Step-In-Trigger Event,” permitting VSP to engage a third party to carry out the otto project as set forth in the TTDA. VSP contends that PFO produced a defective product and failed to meet numerous critical beta test launch dates, delaying the otto launch on multiple occasions. In February 2013 VSP exercised its Step-In-Rights and contracted with third parties to complete the otto launch.

VSP filed suit against PFO in 2013, alleging claims for breach of contract and declaratory relief. PFO has filed a cross-complaint against VSP for fraud, breach of contract, aiding and abetting breach of fiduciary duty, and unfair competition.

Trial is currently set to commence on 1/22/2019.

Moving Papers. Plaintiff VSP moves for an order compelling further responses to Request for Production (“RFP”) Nos. 107-119 on the grounds PFO’s objections are meritless, the responses are evasive and not code-compliant, and no privilege log has been provided. The motion also seeks an award of monetary sanctions.

Opposition. Defendant PFO opposes, arguing that this motion is “misleading, baseless, and in bad faith.” In particular, the opposition insists that VSP’s complaints about PFO’s objections are “groundless” and that VSP itself has custody and control of the “source code” which is the subject of several requests but regardless, PFO previously produced all of its responsive documents. PFO adds that VSP’s requests relating to Hillair, from whom PFO borrowed money, are “irrelevant” and VSP failed to respond to PFO’s request for an explanation as to how such documents are relevant. The opposition claims that the remaining requests are duplicative of earlier discovery, to which PFO has already responded with a full production of documents.

Analysis

At the outset, the court must remind all counsel that given the number of motions such as this which must be addressed on a daily basis, there are simply not enough judicial resources available to resolve each and every discovery dispute that could have and should have been resolved informally. This serves to highlight the critical need for all counsel’s legitimate, reasonable and good faith meet-and-confer efforts before filing any discovery motion. Although it dealt with a motion to compel answers to deposition questions, the decision of Townsend v. Superior Court (1998) 61 Cal.App.4th 1431 is instructive in that it clarifies that the meet-and-confer process is not intended to be some perfunctory formality but rather it “requires…a serious effort at negotiation and informal resolution.” (Id., at 1438.) Nevertheless, despite the number of other matters on this calendar, this court will address yet another largely unremarkable discovery dispute which could have and should have been resolved by counsel via the meet-and -confer process without the use of finite judicial resources.

RFP 107 asks for “The SOURCE CODE.” (Although the definition of this term is not provided in the separate statement, the underlying requests do include a definition.) PFO objected that this RFP is “vague, ambiguous, unduly burdensome, overbroad, harassing, and oppressive, particularly in light of the fact that VSP owns the ‘Source Code’ and has had control of it since the inception of the TTDA” but nevertheless

responded that PFO has told VSP’s attorneys how to obtain free access to whatever “source code” may exist on the Github account owned by VSP and its vendors and further stated “PFO will also produce any other information it has regarding the “source code.”

The court will overrule PFO’s objections because none appears on its face have genuine merit and because the opposition has failed to justify any of these objections. The suggestion that VSP is estopped from challenging these objections by virtue of asserting them in response to PFO’s earlier discovery requests has no support in the law and is categorically rejected here.

Additionally, PFO’s response to this RFP does not comply with the applicable code requirements and leaves unclear what is and what is not being produced and why. Code of Civil Procedure §2031.210(a) provides in pertinent part:

The party to whom a demand for inspection…has been directed shall respond separately to each item or category of item by any of the following:

(1) A statement that the party will comply with the particular demand for inspection, copy, testing, or sampling by the date set for the inspection, copying…pursuant to paragraph 2(c) of section 2031.030 and any related activities.

(2) A representation that the party lacks the ability to comply with the demand for inspection, copying…of a particular item or demand.

Code of Civil Procedure §2031.220 states in its entirety:

A statement that the party to whom a demand for inspection, copying, testing, or sampling has been directed will comply with the particular demand shall state that the production, inspection, copying, testing, or sampling, and related activity demanded, will be allowed either in whole or in part, and that all documents or things in the demanded category that are in the possession, custody, or control of that party and to which no objection is being made will be included in the production.

Code of Civil Procedure §2031.230 provides as follows:

A representation of inability to comply with the particular demand for inspection, copying, testing, or sampling shall affirm that a diligent search and a reasonable inquiry has been made in an effort to comply with that demand. This statement shall also specify whether the inability to comply is because the particular item or category has never existed, has been destroyed, has been lost, misplaced, or stolen, or has never been, or is no longer, in the possession, custody, or control of the responding party. The statement shall set forth the name and address of any natural person or organization known or believed by that party to have possession, custody, or control of that item or category of item.

Finally, Code of Civil Procedure §2031.240 states in pertinent part:

(a) If only part of an item or category of item in a demand for inspection, copying, testing, or sampling is objectionable, the response shall contain a statement of compliance, or a representation of inability to comply with respect to the remainder of that item or category.

(b) If the responding party objects to the demand for inspection, copying, testing, or sampling of an item or category of item, the response shall do both of the following:

(1) Identify with particularity any document, tangible thing, land, or electronically stored information falling within any category of item in the demand to which an objection is being made.

(2) Set forth clearly the extent of, and the specific ground for, the objection. If an objection is based on a claim of privilege, the particular privilege invoked shall be stated. If an objection is based on a claim that the information sought is protected work product under Chapter 4 (commencing with Section 2018.010), that claim shall be expressly asserted.

Since PFO has failed to comply with these requirements, it shall provide a further response to RFP 107.

RFP 108 asks for “All DOCUMENTS…RELATING TO the SOURCE CODE.” (Although the definitions of these terms are not provided in the separate statement, the underlying requests do include their definitions.) PFO’s response to this RFP was identical to that of RFP 107 and is deficient for the same reasons. Thus, a further response to RFP 108 is also warranted.

RFP 109 asks for “All DOCUMENTATION RELATING TO the SOURCE CODE.” (Although the definitions of these terms are not provided in the separate statement, the underlying requests do include their definitions.) PFO’s response to this RFP was identical to that of RFP Nos. 107 and 108, thereby requiring a further response to RFP 109 as well.

RFP 110 asks for “All COMMUNICATIONS with HILLAIR RELATING TO VSP.” PFO objected to this RFP on the ground it is not reasonably calculated and seeks information which is irrelevant, confidential financial or proprietary information, and/or protected by the attorney client privilege and work product doctrine.

The relevance and not reasonably calculated objections are overruled since the court is persuaded that the responsive documents are reasonably calculated to lead to admissible evidence, a rather broad standard for discovery. While the objection based on confidential financial or proprietary information appears valid, the parties’ existing protective order should eliminate any valid concerns relating to the use and disclosure of such information. Likewise, the privilege/work product objection appears valid but to the extent it is asserted, PFO must comply with the requirements of Code of Civil Procedure §2031.240(c)(1) which states in its entirety:

If an objection is based on a claim of privilege or a claim that the information sought is protected work product, the response shall provide sufficient factual information for other parties to evaluate the merits of that claim, including, if necessary, a privilege log.

Consequently, PFO shall provide a further response to RFP 110.

RFP 111 asks for “All COMMUNICATIONS with HILLAIR RELATING TO OTTO.” As PFO’s response (consisting solely of objections) is identical to RFP 110, the court will order a further response to RFP 111 too.

RFP 112 seeks “All COMMUNICATIONS with HILLAIR RELATING TO [this] lawsuit.” PFO’s response to this RFP consisting solely of objections is deficient for the same reasons discussed in connection RFP 110 and PFO shall therefore provide a further response to RFP 112.

RFP 113 is similar to RFP Nos. 110-112 in that it demands “All DOCUMENTS RELATING TO VSP, OTTO, and/or [this] lawsuit…which YOU sent [sic] or received from HILLAIR.” Since PFO’s response to this RFP is identical to its responses to RFP Nos. 110-112, a further response to RFP 113 is appropriate.

RFP 114 asks for “All DOCUMENTS…RELATING TO any and all work that YOU performed pursuant to the TTDA and its ACCOMPANYING AGREEMENTS.” In response, PFO objected to this RFP on the grounds it is vague, burdensome and harassing in light of PFO’s previous responses to VSP’s document requests; seeks confidential financial or proprietary information; invades the attorney-client privilege and the attorney work product doctrine; and seeks a compilation in violation of Code of Civil Procedure §2030.230.

The objection based on §2030.230 is overruled as this provision has no application to requests for production under §2031.010 et seq. The objections of vague, burdensome and harassing are also overruled because none appears on its face have genuine merit and because the opposition has failed to justify any of these objections. PFO’s “estoppel” argument was already rejected. The parties’ protective order should suffice to properly limit VSP’s use of any confidential financial and/or proprietary information which may be responsive. While the privilege/work product objection may be properly asserted, PFO has failed to satisfy the requirements of Code of Civil Procedure §2031.240(c)(1). For these reasons, PFO shall provide a further response to RFP 114.

RFP 115 requests for “All DOCUMENTS…RELATING TO any and all work that YOU performed RELATING TO OTTO.” PFO’s response consisted solely of the same objection asserted in response to RFP 114 and for the same reasons, PFO shall provide a further response to RFP 115 as well.

RFP 116 seeks “All DOCUMENTS…RELATING TO any and all work performed by any subcontractors YOU hired to fulfill YOUR obligations pursuant to the TTDA and its ACCOMPANYING AGREEMENTS.” PFO’s response against consisted solely of the same objections cited in response to RFP Nos. 114-115 and since these objections, aside from the attorney-client privilege and the attorney work product doctrine, do not justify PFO’s failure to comply with this request, a further response which conforms to the requirements of Code of Civil Procedure §§2031.210 et seq. is necessary. To the extent PFO insists any responsive documents is protected by either the attorney-client privilege or the attorney work product doctrine, it must comply with §2030.240.

RFP 117 resembles RFP 116 in that it asks for “All DOCUMENTS…RELATING TO any and all work performed by any subcontractors YOU hired to perform work RELATING TO OTTO.” PFO’s assertion of the same objections is, for the reasons explained above, inadequate and therefore, it shall provide a further response to RFP 117 too.

RFP 118 demands “All DOCUMENTS…RELATING TO OTTO.” PFO’s assertion of the same objections is, for the reasons explained above, insufficient and therefore, a

further response to RFP 118 must also be provided.

RFP 119 asks for “All BUSINESS DATA.” (Although the definition of this term is not provided in the separate statement, the underlying requests do include a definition (i.e

., shall have the meaning set forth in §16.2 of the TTDA).) PFO’s response to RFP 119 included the same objections as RFP Nos. 114-118 along with one additional objection that the term “Business Data” is vague. The court will overrule the latter objection and require PFO to provide a further response to RFP 119 for the same reasons discussed above in connection with RFP Nos. 114-118.

Conclusion

In light of the foregoing, the present motion to compel is granted.

PFO shall provide verified further responses without objections (except those based on the attorney-client privilege and the attorney work product doctrine) and in conformity with the requirements of Code of Civil Procedure §§2031.210 et seq., along with all non-privileged documents in PFO’s possession, custody or control which were not previously produced, no later than 1/15/2019 (unless VSP agrees to a later date memorialized in writing).

VSP is awarded monetary sanctions in the amount of $2,100, representing eight (8) hours of attorney time at $255/hour plus the $60 filing fee. Sanctions to be paid no later than 2/1/2019 and if not paid by that date, VSP may prepare for the court’s signature a formal order granting the sanctions, which may then be enforced as a separate judgment against PFO. (Newland v. Superior Court (1995) 40 Cal.App.4th 608, 615.)

This minute order is effective immediately. No formal order or other notice is required. (Code Civ. Proc. §1019.5; CRC Rule 3.1312.)