1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA
9 Advance Realty LLC, No. CV-25-02420-PHX-DJH
10 Plaintiff, ORDER
11 v.
12 Unknown Party,
13 Defendant. 14 15 Before the Court is Plaintiff Advance Realty LLC’s (“Plaintiff”) Ex Parte Motion 16 for Expedited Discovery. (Doc. 3). For the reasons sets forth below, the Court will deny 17 the Motion. 18 I. Background 19 On July 10, 2025, Plaintiff filed a Complaint as an assignee of a real estate 20 investment firm called Rise48 Holdings, LP (“Rise48”). (Doc. 1 at 2). Defendant in this 21 case, is an unknown party with the screen username of Subordinate Capital Ape 22 (“Defendant”). (Id.) Beginning in October of 2023, Plaintiff alleges that Defendant 23 posted comments on the Wall Street Oasis (“WSO”), an online platform, about a 24 recapitalization preferred equity opportunity at the investment firm. (Doc. 1 at ¶¶ 10, 25 11). Deals like preferred equity deals, according to Plaintiff, usually occur when a real 26 estate investment offering is struggling or underperforming. (Id.) Because of this, 27 Plaintiff alleges that Defendant’s use of the term “recap pref opportunity” in Defendant’s 28 comments online, signaled to potential investors that Rise48 was struggling. (Id. at ¶ 12). 1 Defendant then proceeded to post specifics about the deal such as the asset basis, the 2 percentage of occupied and vacant units the properties had, the net operating income, the 3 yield on cost, and the operating expense ratio. (Doc. 1 at ¶ 13). Based on the comments 4 and the specificity, Plaintiff asserts that the unknown Defendant must be an analyst at 5 either one of the banks, lenders, or potential investors that Plaintiff sought financing 6 from. (Doc. 1 at ¶¶ 2–3). Plaintiff contends that the disclosure of this information on a 7 public forum is a violation of the Non-disclosure Agreement that all analysts working on 8 behalf of Plaintiff were bound by. (Doc. 1 at ¶ 3). Due to this unlawful disclosure, 9 Plaintiff brings a two-count claim against Defendant: Breach of Contract and Trade 10 Secret Misappropriation under the Defend Trade Secrets Act (“DTSA”). (Doc. 1 at 11 ¶¶ 20–31). Now, Plaintiff seeks to expedite discovery to determine the identity of the 12 unknown individual responsible for posting confidential deal specifics online. 13 II. Legal Standard 14 Rule 26(d) provides that “[a] party may not seek discovery from any source before 15 the parties have conferred as required by Rule 26(f), except in a proceeding exempted 16 from initial disclosure under Rule 26(a)(1)(B), or when authorized by these rules, by 17 stipulation, or by court order.” A court may authorize expedited discovery to proceed 18 before service to defendants if it finds that there is good cause to do so. “Good cause may 19 be found where the need for expedited discovery, in consideration of the administration 20 of justice, outweighs the prejudice to the responding party.” Semitool, Inc. v. Tokyo 21 Electron Am., Inc., 208 F.R.D. 273, 276 (N.D. Cal. 2002). Some limiting principals 22 should apply to the determination of whether discovery to uncover the identity of a 23 defendant is warranted to ensure that “the plaintiff has in good faith exhausted traditional 24 avenues for identifying a civil defendant pre-service and will prevent use of this method 25 to harass or intimidate.” Columbia Ins. Co. v. seescandy.com, 185 F.R.D. 573, 578 (N.D. 26 Cal. 1999). The Court will consider whether Plaintiff: (1) can identify the missing party 27 with sufficient specificity that the Court can determine that Defendants are real persons 28 or entities that could be sued in federal court; (2) has identified all previous steps taken to 1 locate the elusive defendant; (3) can establish that its suit against Defendants could 2 withstand a motion to dismiss; and (4) has shown that there is a reasonable likelihood that 3 expedited discovery will lead to identifying information about Defendants that would 4 make service of process possible. Id. at 578–80. 5 III. Discussion 6 Of the four factors that the Court must examine to determine if expedited 7 discovery is warranted, consideration of the first two give the Court pause. The first 8 concerns the Court’s jurisdiction over the unidentified Defendant and the second is about 9 the exhaustion of good faith efforts taken by Plaintiff to locate the unknown Defendant. 10 A. Identification of Missing Parties 11 A plaintiff should be able to identify the missing party with sufficient specificity 12 so that the Court can determine if jurisdiction can be established over the individual or 13 entity. Columbia Ins. Co., 185 F.R.D. at 578. Plaintiff provided this Court with the 14 online username of the unidentified individual who posted comments about deal statistics 15 on WSO and a specified time and date that the comments were posted. Plaintiff has not, 16 however, provided an IP address for that individual or any other information that would 17 allow this Court to determine that it has jurisdiction over them. (Doc. 3 at 3). In 18 Breaking Glass, an analogous case from this District, the plaintiff seeking expedited 19 discovery had already compiled a list of 117 unique IP addresses for the Court and an 20 exact date and time of the infringing action. Breaking Glass Pictures, LLC v. Doe, No. 21 CV-13-00599-PHX-GMS, 2013 WL 3805637, at *4 (D. Ariz. July 22, 2013). The court 22 there found that the plaintiff had “sufficiently identified the Doe Defendants in a way that 23 the Court can determine that they are real persons or entities that could be sued in federal 24 court.” (Id. at *5). That type of important identifying information is lacking here. 25 Without more information, the Court finds that Plaintiff has not at this stage identified the 26 missing party with “sufficient specificity” that the Court can determine it has jurisdiction 27 over Defendant. Columbia Ins. Co., 185 F.R.D. at 579 (granting expedited discovery 28 after finding that defendants had a California domicile, showing that the Court likely had 1 personal jurisdiction over them). Therefore, the Court finds that this factor weighs 2 against granting Plaintiff’s expedited discovery request. 3 B. Steps Taken to Locate Defendant 4 The Plaintiff should next identify all steps taken to locate the unknown defendant. 5 Columbia Ins. Co., 185 F.R.D. at 579. This requirement ensures that plaintiff makes a 6 good faith effort to comply with the requirements of service of process. Id. The Court is 7 unconvinced that Plaintiff took any steps to locate the unknown Defendant. After 8 identifying the unknown Defendant’s username and perusing past comments made by the 9 Defendant, Plaintiff did nothing more to ascertain the identity of the person behind the 10 username. Plaintiff states that it was sufficiently deterred from seeking IP address and 11 other information from WSO before filing this Motion because WSO prides itself as a 12 forum that encourages anonymity. (Doc. 3 at 3). Again, in Breaking Glass, the court 13 found that this factor weighed in favor of allowing expedited discovery only after 14 Plaintiff obtained the IP addresses of each unknown defendant and then traced those IP 15 addresses to an associated ISP1 in Arizona. Breaking Glass Pictures, LLC, 2013 WL 16 3805637, at *4. Nothing of the sort has happened here. Instead, Plaintiff alleges that 17 WSO is “unlikely to provide Plaintiff further information without a subpoena.” (Doc. 3 18 at 3). A hypothetical “unlikely” cannot let this Court sidestep the usual commands of the 19 federal rules of discovery. Columbia Ins. Co. v. seescandy.com, 185 F.R.D. 573, 578 20 (N.D. Cal. 1999) (explaining the reluctance of courts to sidestep traditional discovery 21 procedures). The Court finds that Plaintiff has failed to satisfy the demands of this factor. 22 C.
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1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA
9 Advance Realty LLC, No. CV-25-02420-PHX-DJH
10 Plaintiff, ORDER
11 v.
12 Unknown Party,
13 Defendant. 14 15 Before the Court is Plaintiff Advance Realty LLC’s (“Plaintiff”) Ex Parte Motion 16 for Expedited Discovery. (Doc. 3). For the reasons sets forth below, the Court will deny 17 the Motion. 18 I. Background 19 On July 10, 2025, Plaintiff filed a Complaint as an assignee of a real estate 20 investment firm called Rise48 Holdings, LP (“Rise48”). (Doc. 1 at 2). Defendant in this 21 case, is an unknown party with the screen username of Subordinate Capital Ape 22 (“Defendant”). (Id.) Beginning in October of 2023, Plaintiff alleges that Defendant 23 posted comments on the Wall Street Oasis (“WSO”), an online platform, about a 24 recapitalization preferred equity opportunity at the investment firm. (Doc. 1 at ¶¶ 10, 25 11). Deals like preferred equity deals, according to Plaintiff, usually occur when a real 26 estate investment offering is struggling or underperforming. (Id.) Because of this, 27 Plaintiff alleges that Defendant’s use of the term “recap pref opportunity” in Defendant’s 28 comments online, signaled to potential investors that Rise48 was struggling. (Id. at ¶ 12). 1 Defendant then proceeded to post specifics about the deal such as the asset basis, the 2 percentage of occupied and vacant units the properties had, the net operating income, the 3 yield on cost, and the operating expense ratio. (Doc. 1 at ¶ 13). Based on the comments 4 and the specificity, Plaintiff asserts that the unknown Defendant must be an analyst at 5 either one of the banks, lenders, or potential investors that Plaintiff sought financing 6 from. (Doc. 1 at ¶¶ 2–3). Plaintiff contends that the disclosure of this information on a 7 public forum is a violation of the Non-disclosure Agreement that all analysts working on 8 behalf of Plaintiff were bound by. (Doc. 1 at ¶ 3). Due to this unlawful disclosure, 9 Plaintiff brings a two-count claim against Defendant: Breach of Contract and Trade 10 Secret Misappropriation under the Defend Trade Secrets Act (“DTSA”). (Doc. 1 at 11 ¶¶ 20–31). Now, Plaintiff seeks to expedite discovery to determine the identity of the 12 unknown individual responsible for posting confidential deal specifics online. 13 II. Legal Standard 14 Rule 26(d) provides that “[a] party may not seek discovery from any source before 15 the parties have conferred as required by Rule 26(f), except in a proceeding exempted 16 from initial disclosure under Rule 26(a)(1)(B), or when authorized by these rules, by 17 stipulation, or by court order.” A court may authorize expedited discovery to proceed 18 before service to defendants if it finds that there is good cause to do so. “Good cause may 19 be found where the need for expedited discovery, in consideration of the administration 20 of justice, outweighs the prejudice to the responding party.” Semitool, Inc. v. Tokyo 21 Electron Am., Inc., 208 F.R.D. 273, 276 (N.D. Cal. 2002). Some limiting principals 22 should apply to the determination of whether discovery to uncover the identity of a 23 defendant is warranted to ensure that “the plaintiff has in good faith exhausted traditional 24 avenues for identifying a civil defendant pre-service and will prevent use of this method 25 to harass or intimidate.” Columbia Ins. Co. v. seescandy.com, 185 F.R.D. 573, 578 (N.D. 26 Cal. 1999). The Court will consider whether Plaintiff: (1) can identify the missing party 27 with sufficient specificity that the Court can determine that Defendants are real persons 28 or entities that could be sued in federal court; (2) has identified all previous steps taken to 1 locate the elusive defendant; (3) can establish that its suit against Defendants could 2 withstand a motion to dismiss; and (4) has shown that there is a reasonable likelihood that 3 expedited discovery will lead to identifying information about Defendants that would 4 make service of process possible. Id. at 578–80. 5 III. Discussion 6 Of the four factors that the Court must examine to determine if expedited 7 discovery is warranted, consideration of the first two give the Court pause. The first 8 concerns the Court’s jurisdiction over the unidentified Defendant and the second is about 9 the exhaustion of good faith efforts taken by Plaintiff to locate the unknown Defendant. 10 A. Identification of Missing Parties 11 A plaintiff should be able to identify the missing party with sufficient specificity 12 so that the Court can determine if jurisdiction can be established over the individual or 13 entity. Columbia Ins. Co., 185 F.R.D. at 578. Plaintiff provided this Court with the 14 online username of the unidentified individual who posted comments about deal statistics 15 on WSO and a specified time and date that the comments were posted. Plaintiff has not, 16 however, provided an IP address for that individual or any other information that would 17 allow this Court to determine that it has jurisdiction over them. (Doc. 3 at 3). In 18 Breaking Glass, an analogous case from this District, the plaintiff seeking expedited 19 discovery had already compiled a list of 117 unique IP addresses for the Court and an 20 exact date and time of the infringing action. Breaking Glass Pictures, LLC v. Doe, No. 21 CV-13-00599-PHX-GMS, 2013 WL 3805637, at *4 (D. Ariz. July 22, 2013). The court 22 there found that the plaintiff had “sufficiently identified the Doe Defendants in a way that 23 the Court can determine that they are real persons or entities that could be sued in federal 24 court.” (Id. at *5). That type of important identifying information is lacking here. 25 Without more information, the Court finds that Plaintiff has not at this stage identified the 26 missing party with “sufficient specificity” that the Court can determine it has jurisdiction 27 over Defendant. Columbia Ins. Co., 185 F.R.D. at 579 (granting expedited discovery 28 after finding that defendants had a California domicile, showing that the Court likely had 1 personal jurisdiction over them). Therefore, the Court finds that this factor weighs 2 against granting Plaintiff’s expedited discovery request. 3 B. Steps Taken to Locate Defendant 4 The Plaintiff should next identify all steps taken to locate the unknown defendant. 5 Columbia Ins. Co., 185 F.R.D. at 579. This requirement ensures that plaintiff makes a 6 good faith effort to comply with the requirements of service of process. Id. The Court is 7 unconvinced that Plaintiff took any steps to locate the unknown Defendant. After 8 identifying the unknown Defendant’s username and perusing past comments made by the 9 Defendant, Plaintiff did nothing more to ascertain the identity of the person behind the 10 username. Plaintiff states that it was sufficiently deterred from seeking IP address and 11 other information from WSO before filing this Motion because WSO prides itself as a 12 forum that encourages anonymity. (Doc. 3 at 3). Again, in Breaking Glass, the court 13 found that this factor weighed in favor of allowing expedited discovery only after 14 Plaintiff obtained the IP addresses of each unknown defendant and then traced those IP 15 addresses to an associated ISP1 in Arizona. Breaking Glass Pictures, LLC, 2013 WL 16 3805637, at *4. Nothing of the sort has happened here. Instead, Plaintiff alleges that 17 WSO is “unlikely to provide Plaintiff further information without a subpoena.” (Doc. 3 18 at 3). A hypothetical “unlikely” cannot let this Court sidestep the usual commands of the 19 federal rules of discovery. Columbia Ins. Co. v. seescandy.com, 185 F.R.D. 573, 578 20 (N.D. Cal. 1999) (explaining the reluctance of courts to sidestep traditional discovery 21 procedures). The Court finds that Plaintiff has failed to satisfy the demands of this factor. 22 C. Prima Facie Case 23 This factor requires that the Court examine if Plaintiff’s Complaint will withstand 24 a motion to dismiss. Columbia Ins. Co, 185 F.R.D. at 579–80. The reason for this 25 requirement is to prevent abuse of the discovery process. Id. Plaintiff brings claims for 26 misappropriation of trade secrets and breach of a nondisclosure agreement. (Doc. 3 at 4).
27 1 An ISP stands for Internet Service Provider. See Breaking Glass Pictures, LLC v. Doe, No. CV-13-00599-PHX-GMS, 2013 WL 3805637, at *1 (D. Ariz. July 22, 2013) 28 (explaining what an ISP is). 1 To succeed on a claim for misappropriation of trade secrets under the DTSA, a plaintiff 2 must prove: (1) that the plaintiff possessed a trade secret, (2) that the defendant 3 misappropriated the trade secret; and (3) that the misappropriation caused or threatened 4 damage to the plaintiff. See 18 U.S.C. § 1839(5). Here, Plaintiff has identified the trade 5 secrets as “(a) the exact capitalization of a confidential recapitalization opportunity; (b) 6 trailing 12-month and 3-month performance data; (c) internal vacancy rates; (d) forward- 7 looking expense reduction assumptions; and (e) proprietary pro forms return targets— 8 none of which were disclosed to the public or in any publicly available materials.” 9 (Doc. 1 at 4); see 18 U.S.C. § 1839(3) (defining the term trade secret broadly). The 10 owner of the trade secrets must have also taken reasonable measures to keep the 11 information secret for it to qualify as a trade secret. 18 U.S.C. § 1839(3). Plaintiff has 12 done that here by stating that all those acquainted or closely aligned with deals at the 13 company were required to sign non-disclosure agreements. (Doc. 3 at 3). Then, Plaintiff 14 alleges that when Defendant posted statistics about the underlying deals at the company 15 online, that was a misappropriation. (Id. at 4). Misappropriation in the context of trade 16 secrets is defined by 18 U.S.C. § 1839(5). One way for a trade secret to be 17 misappropriated is if was “acquired under circumstances giving rise to a duty to maintain 18 the secrecy of the trade secret or limit the use of the trade secret.” Section 19 1839(5)(B)(2)(ii)(II). And that is exactly what Plaintiff is alleging here. By signing a 20 non-disclosure agreement, the unknown Defendant was bound by a duty to maintain the 21 secrecy of the trade secret and yet failed to do so by posting comments about deal 22 statistics online. (Doc. 1 at ¶¶ 2–4). Plaintiff has also adequately alleged the harm that 23 resulted from the online disclosure, such as “loss of competitive advantage, impaired 24 relationships with investors, and diminution in the value of its trade secrets. (Id. at ¶ 31). 25 As to the breach of contract claim for the breach of the nondisclosure agreement, 26 to state prima facie case for breach, Plaintiff must establish the existence of a contract, a 27 breach, and resulting damages. Scottsdale Ins. Co. v. Deanna K. Cook, No. CV-10-1661- 28 PHX-FJM, 2010 WL 4942764, at *2 (D. Ariz. Nov. 24, 2010) (quoting Clark v. 1 Compania Ganadera de Cananea, S.A., 387 P.2d 235, 238 (1963) (stating the 2 requirements to establish a breach of contract claim). Plaintiff maintains this requirement 3 will be met because of the underlying non-disclosure agreement that Plaintiff is prepared 4 to turn over to the Court. (Doc. 1 at ¶ 4). By disclosing secrets in an online forum, even 5 if anonymously, Plaintiff also contends that a breach occurred. (Id. at ¶ 21). And 6 Plaintiff has suffered damages as outlined by the trade secret analysis above. For the 7 reasons stated, the Court finds that Plaintiff has demonstrated a prima facie case for both 8 trade secret misappropriation and breach of contract. 9 D. Reasonable Likelihood of Identification 10 This factor examines whether Plaintiff has demonstrated that expedited discovery 11 will lead to identifying information about Defendants to allow service of process. 12 Breaking Glass Pictures, LLC v. Doe, 2013 WL 3805637, at *5. Plaintiff avows that the 13 unknown Defendant can be identified because WSO users can sign in through other 14 identifying information like their Google LinkedIn, Facebook or Apple accounts. (Doc. 3 15 at 4). According to Plaintiff, it is also likely that WSO maintains account registration 16 records, including email addresses and IP logs, which can be used to identify the 17 unknown Defendant. (Id.) If the IP address becomes known, Plaintiff contends it can 18 then serve a subpoena of the phone company or email provider to identify the specific 19 person who posted the comments. (Id.) The Court finds that Plaintiff meets this factor. 20 However, at this juncture, and due to the Court’s concerns regarding Plaintiff’s ability to 21 sufficiently identify and locate Defendant, the Court will deny Plaintiff’s Motion to 22 Expedite Discovery. 23 Accordingly, 24 / / / 25 / / / 26 / / / 27 / / / 28 / / / 1 IT IS ORDERED that Plaintiff's Motion to Expedite Discovery (Doc. 3) is □□ denied. 3 Dated this 29th day of July, 2025. 4 5 ZL Luu □ 6 norable’Diang4. Hunfetewa 7 United States District Judge 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
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