KIC LLC v. Zhejiang Dicastal Hongxin Technology Co Ltd

• Court: District Court, W.D. Washington
• Decided: March 30, 2020
• Docket: 3:19-cv-05660
• Status: Unknown

Opinion

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6 7 UNITED STATES DISTRICT COURT 8 WESTERN DISTRICT OF WASHINGTON AT TACOMA 9 10 KIC LLC, a Delaware Limited Liability CASE NO. 19-cv-5660-RJB 11 Company, ORDER ON PLAINTIFF’S 12 Plaintiff, MOTION TO COMPEL v. DISCOVERY 13 ZHEJIANG DICASTAL HONGXIN 14 TECHNOLOGY CO. LTD., a Chinese Corporation 15 Defendant. 16 17 THIS MATTER comes before the Court on Plaintiff’s Motion to Compel Discovery. Dkt. 18 26. The Court is familiar with the motion, all materials filed in support of and in opposition 19 thereto, and the remainder of the record herein. For the reasons set forth below, Plaintiff’s 20 motion should be granted, in part, and denied, in part. 21 I. BACKGROUND 22 Plaintiff is a manufacturer and designer of automotive parts, including wheels and wheel 23 end products. Dkt. 26, at 2. Defendant is a wheel manufacturer. Dkt. 26, at 3. Plaintiff alleges 24 1 that Defendant breached a Distribution Agreement and Confidentially Agreement through its use 2 of Plaintiff’s confidential and trade secret information and sale of wheels to Plaintiff’s 3 customers. Dkt. 26, at 2. 4 On November 18, 2019, Plaintiff served on Defendant its First Set of Requests for 5 Admission, Interrogatories and Requests for Production of Documents on Hongxin (“Discovery

6 Requests”). Defendant served on Plaintiff a Response to Discovery Requests, dated January 16, 7 2020, following an agreed extension for the holidays. Dkts. 26, at 4; and 27-1. After various 8 discussions between the Parties, Defendant completed a Revised Response to Discovery 9 Requests, dated February 20, 2020 (Dkt. 27-5.).1 See Dkt. 26, at 4–5. The Parties held a 10 telephonic conference on February 27, 2020, but apparently only partially resolved the dispute. 11 See Dkt. 26, at 1-2. 12 On February 28, 2020, Plaintiff filed the instant Motion to Compel Discovery. Dkt. 26. 13 Plaintiff requests sanctions against Defendant and disputes the sufficiency of Defendant’s 14 Revised Response to Discovery Requests as to Requests for Admission (“RFA”) 3–5 and

15 Interrogatories 1,2 2, and 5. Dkt. 26. 16 Defendant filed a response in opposition to the instant motion. Dkt. 28. Attached with 17 Defendant’s response is a Second Revised Response to Discovery Requests, dated March 13, 18 2020. Dkt. 29-1. Defendant argues that (1) the Parties did not meaningfully meet and confer 19 because Plaintiff filed the instant motion one day after the Parties met and conferred; and (2) 20 21

22 1 It is unclear whether the Revised Response to Discovery Requests was dated February 10, 2020, or February 20, 2020. Compare Dkt. 26, at 5:5, with Dkt. 27-5, at 17. 23 2 It appears that Plaintiff disputes the sufficiency of the response to Interrogatory No. 1, see, e.g., Dkt. 26, at 5:22– 24 23, although Plaintiff does not explicate the relief requested as to Interrogatory No. 1. See Dkts. 26, at 2; and 26-1. 1 Plaintiff’s Second Revised Response to Discovery Requests sufficiently answers Plaintiff’s 2 discovery requests. Dkt. 28. 3 Plaintiff filed a reply in support of the instant motion. Dkt. 32. Plaintiff contends, in part, 4 that the Second Revised Response to Discovery Requests is deficient. Dkt. 32. 5 II. DISCUSSION

6 1. DISCOVERY STANDARDS 7 Under the Federal Rules of Civil Procedure, parties may generally obtain discovery 8 regarding any non-privileged matter that is relevant to any party’s claim or defense and 9 proportional to the needs of the case. Fed. R. Civ. P. 26. Information need not be admissible at 10 trial to be discoverable. Fed. R. Civ. P. 26(b)(1). 11 FRCP 37(a)(1) provides that, in part: 12 On notice to other parties and all affected persons, a party may move for an order compelling disclosure or discovery. The motion 13 must include a certification that the movant has in good faith conferred or attempted to confer with the person or party failing to 14 make disclosure or discovery in an effort to obtain it without court action. 15 FRCP 37(a)(3)(A)–(B) provides that: 16 (A) To Compel Disclosure. If a party fails to make a disclosure 17 required by Rule 26(a), any other party may move to compel disclosure and for appropriate sanctions. 18 (B) To Compel a Discovery Response. A Party seeking discovery 19 may move for an order compelling an answer, designation, production, or inspection. 20 Courts are given broad discretion to control discovery under FRCP 37, including 21 “particularly wide latitude … to issue sanctions under FRCP 37(c)(1)[.]” Ollier v. Sweetwater 22 Union High Sch. Dist., 768 F.3d 843, 859 (9th Cir. 2014) (quoting Yeti by Molly, Ltd. v. Deckers 23 Outdoor Corp., 259 F.3d 1101, 1106 (9th Cir. 2001)). 24 1 2. MEET AND CONFER REQUIREMENTS 2 Plaintiff certifies that the Parties met and conferred and had a telephonic conference on 3 February 27, 2020, but they were unable to resolve this dispute. Dkt. 26, at 1-2. Defendant 4 contends that Plaintiff did not give it reasonable time to respond when Plaintiff filed the instant 5 motion one day after the telephonic conference. Dkt. 28, at 3. Regardless, even though the

6 Parties apparently agreed that Defendant would withdraw some objections, the Parties did not 7 reach resolution of all the disputes herein. See Dkt. 32. 8 Therefore, Plaintiff’s motion satisfies the meet and confer requirements under Fed. R. 9 Civ. P. 37(a)(1). 10 3. DISCOVERY DISPUTE 11 When Plaintiff filed the instant motion on February 28, 2020, Defendant’s most recent 12 answers and responses appear to have been the Revised Reponses to Discovery Requests, dated 13 February 20, 2020. See Dkt. 27-5. Defendant’s response brief contains an attached Second 14 Revised Response to Discovery Requests, dated March 13, 2020. Dkt. 29-1. Plaintiff contends

15 that Defendant’s Second Revised Response to Discovery Requests is also deficient. Dkt. 32. 16 Below, the Court cites to the Second Revised Response to Discovery Requests (Dkt. 29-1, at 2; 17 “This set of revised responses supersedes the original Responses and Objections served on 18 January 17, 2020 and the Revised set served on February 20, 2020”) as the operative set of 19 responses for its discussion of RFAs 3–5 and Interrogatories 1, 2, and 5. 20 a. RFA No. 3 21 Request No. 3: Admit that Hongxin sold the Products to FleetPride, Inc. during the term of the Distribution Agreement. 22 ANSWER: Objection. The term “Products’ is vague and 23 ambiguous.

24 1 ….

2 Subject to and without waiving these objections, Defendant Zhejiang Hongxin responds as follows: 3 ADMIT, but Defendant Zhejiang Hongxin denies that it was 4 prohibited from doing so because FleetPride, Inc. has been a longstanding customer of Defendant’s since 2009, before 5 execution of the Distribution Agreement with KIC.

6 Dkt. 29-1, at 6. 7 Defendant’s objection may or may not have merit, but Defendant’s qualified response to 8 RFA 3 appears sufficient. The Court further observes, with some dismay, that Defendant’s 9 response to RFA 3 in the Revised Response (“DENIED”) is the opposite of its response in the 10 operative Second Revised Response (“ADMIT”). Compare Dkt. 27-5, at 6, with Dkt. 29-1, at 6. 11 b. RFA No. 4 12 Request No. 4: Admit that Hongxin sold the Products to Taskmaster Components during the term of the Distribution 13 Agreement.

14 ANSWER: Objection. “Taskmaster Components” is vague and ambiguous and is not a sufficient identifier of a corporate entity. 15 …. 16 Subject to and without waiving these objections, Defendant 17 Zhejiang Hongxin responds as follows:

18 DENIED.

19 Dkt. 29-1, at 6.

20 Defendant’s objection may or may not have merit, but Defendant’s qualified response to 21 RFA No. 4 appears sufficient. See Dkt. 29-1, at 6. 22 c. RFA No. 5 23 Request No. 5: Admit that Hongxin sold the Products during the term of the Distribution Agreement to customers or entities other 24 1 than FleetPride, Inc., Taskmaster Components, PACCAR, and Dragon. 2 ANSWER: Objection. Vague and ambiguous as to the terms 3 “customers or entities.” Compound request. “Taskmaster Components, PACCAR, and Dragon” are vague and ambiguous 4 and are not sufficient identifiers of corporate entities. Leading Question. 5 …. 6 Subject to and without waiving these objections, Defendant 7 Zhejiang Hongxin responds as follows:

8 DENIED that Defendant Zhejiang Hongxin sold to any entities listed on Appendix A other than FleetPride, Inc. Defendant 9 Zhejiang Hongxin sold to other customers not listed on Appendix A. 10 Dkt. 29-1, at 7. 11 Defendant’s answer is cryptic at best and evasive at worst. RFA No. 5 makes no 12 reference to “Appendix A,”3 and it is unclear why Defendant’s answer refers to it. See Dkt. 29-1, 13 at 7. Regardless, despite Defendant having written “DENIED,” the unclear explanation that 14 follows makes it appear that Plaintiff admits to RFA No. 5. See id. 15 d. Interrogatory No. 1 16 Interrogatory No. 1: If Hongxin’s answer to any of the above 17 Requests for Admissions is anything other than an unqualified admission, then for each such answer, identify the following: 18 a. The number of the Request; 19 b. All facts upon which Hongxin bases its response; 20 c. All witness(es) with knowledge of the facts upon which 21 Hongxin bases its response; and

22 d. All documents that support Hongxin’s response.

24 3 A copy of Appendix A is apparently on record at Dkt. 27-4, at 13 et seq; it appears to be Plaintiff’s customer list. 1 Answer: Objection. Compound request. Hongxin objects to this request as overbroad and burdening to the extent it requests “all 2 facts upon which Hongxin bases its responses.” See Weber v. Biddle, 72 Wn.2d 22, 29, 431 P.2d 705 (1967). Hongxin Objects to 3 this request as overbroad and burdensome to the extent it requests “all witnesses with knowledge” and “all documents.” 4 …. 5 Subject to and without waiving these objections, as well as the 6 general objections set forth above:

7 ….

8 Request for Admission No. 3

9 Defendant Hongxin refers to Paragraph 2 of the Distribution Agreement. Hongxin and FleetPride, Inc. have done business since 10 2009. Individuals with knowledge are listed in Interrogatory No. 3 below and in Hongxin’s initial disclosures. It is impractical to list 11 all of the FleetPride, Inc. order documents here. There are many purchase orders, invoices, supply lists, etc. between Hongxin and 12 Fleetpride, Inc. beginning in 2009.

13 Request for Admission No. 4

14 Defendant Zhejiang Hongxin’s answer speaks for itself. Hongxin never sold any Products to Taskmaster Components. Individuals 15 with knowledge are listed in Hongxin’s Initial Disclosures.

16 Request for Admission No. 5

17 Defendant Zhejiang Hongxin’s answer speaks for itself. Other than FleetPride, Inc., Hongxin only sold products on customers not 18 listed on Appendix A during the term of the Distribution Agreement. Individuals with knowledge are listed in Hongxin’s 19 Initial Disclosures, as well as Omar, Neil, John, and Greg of KIC who all verbally agreed to these sales. 20 Dkt. 29-1, at 7–9. 21 “Although the term discrete subparts does not have a precise meaning, courts generally 22 agree that interrogatory subparts ought to be counted as one interrogatory … if they are logically 23 or factually subsumed within and necessarily related to the primary question.” Trevino v. ACB 24 1 American Inc, 232 F.R.D. 612 (N.D. CA 2006) (quotations and citations omitted); see generally 2 Neill v. All Pride Fitness of Washougal, LLC, C08-5424-RJB, 2009 WL 10676369, at *2 (W.D. 3 Wash. May 21, 2009) (discussing case law on what is and is not a discrete subpart). 4 Defendant’s compound question objection is without merit because the interrogatory’s 5 subparts are logically and factually subsumed and necessarily related to the primary question.

6 See Trevino, 232 F.R.D. at 612. 7 However, the Court partially agrees with Defendant’s objection that Interrogatory No. 1 8 is overbroad and burdensome. See Aspen Grove Owners Ass'n. v. Park Promenade Apartments, 9 LLC, C09-1110-JCC, 2010 WL 3788038, at *6 (W.D. Wash. Sept. 17, 2010), report and 10 recommendation adopted, C09-1110-JCC, 2010 WL 3787995 (W.D. Wash. Sept. 23, 2010) 11 (quoting Weber v. Biddle, 72 Wn.2d 22, 29, 431 P.2d 705 (1967) (“[T]he opposing party cannot 12 be required to put on a dress rehearsal of the trial. While it is proper to elicit information as to 13 evidentiary facts as contrasted with ultimate facts, nevertheless it is improper to ask a party to 14 state evidence upon which he intends to rely to prove any fact or facts.”).

15 Nevertheless, Defendant’s answer is partially insufficient. Concerning the answer to 16 Interrogatory No. 1 as it relates to RFA No. 3 (Dkt. 29-1, at 8:16-21), product sales between 17 Defendant and FleetPride, Inc. go to the heart of this case: the alleged violation of a Distribution 18 Agreement prohibiting Defendant from selling certain products to certain customers, including 19 Products to FleetPride, Inc. Therefore, it is reasonable and proportional to the needs of this case 20 for Defendant to produce sales documents of Products, as defined in the Distribution Agreement, 21 sold by Defendant to FleetPride, Inc. 22 e. Interrogatory No. 2 23 Interrogatory No. 2: Identify all sales of the Products by Hongxin to customers listed on Appendix A to the Distribution Agreement 24 1 between March 21, 2013 and March 21, 2019, including for each sale, name of the customer, date of sale, type(s) of Products sold, 2 quantity of Products sold, individual piece price of the Products sold, date that payment was received from the customer for the 3 Products, and, shipment destination for the Products sold.

4 Answer: Objection. This request seeks information protected as trade secrets. Compound request. Overly burdensome to the extent 5 it requests specific information for “all sales.”

6 ….

7 Subject to and without waiving these objections, as well as the general objections set forth above: 8 With regard to entities listed on Appendix A, Hongxin has only 9 sold to FleetPride, Inc. Hongxin began doing business with FleetPride, Inc. in 2009. KIC was aware that Hongxin continued 10 doing business with FleetPride, Inc. after execution of the March 2013 Distribution Agreement. Pursuant to Fed. R. Civ. P 33(d), 11 Hongxin has produced documents in response to this interrogatory.

12 Dkt. 29-1, at 9.

13 To the extent that the only customers listed on Appendix A to whom Defendant sold 14 products between March 21, 2013, and March 21, 2019, was FleetPride, Inc., which is what 15 Defendant claims (Dkt. 29-1, at 7:13–15; and 30, at 2:1–3), Interrogatory No. 2 is duplicative of 16 Interrogatory 1. Dkt. 29-1, at 9. 17 f. Interrogatory No. 5 18 Interrogatory No. 5: Identify all sales of Products by Hongxin to North American (non-U.S.) customers for less than 10% above the 19 price of the same Products Hongxin sold to KIC during the term of the Distribution Agreement, including, for each sale, name of the 20 customer, date of sale, type(s) of Products sold, quantity of Products sold, and individual piece price of the Products sold. 21 Answer: Objection. Compound request. Vague and ambiguous as 22 to “for less than 10% above the price of the same Products Hongxin sold to KIC during the term of the Distribution 23 Agreement.” Vague and ambiguous as to term “Products.” Overly 24 1 burdensome request to the extent it requests specific information about “each sale.” 2 …. 3 Subject to and without waiving these objections, as well as the 4 general objections set forth above:

5 The products sold to Non-U.S. North American customers are often not the same as the products sold to KIC, Pursuant to Fed. R. 6 Civ. Pro 33(d), Hongxin has produced documents in response to this request. 7 Dkt. 29-1, at 11–12. 8 “[D]iscovery of a document may be limited if discovery of such document is unduly 9 burdensome …. However, the Court only entertains an unduly burdensome objection when the 10 responding party demonstrates how the document is “overly broad, burdensome, or oppressive, 11 by submitting affidavits or offering evidence which reveals the nature of the burden.” See 12 Tequila Centinela, S.A. de C.V. v. Bacardi & Co. Ltd., 242 F.R.D. 1, 10 (D.D.C. 2007) (citations 13 omitted). 14 Interrogatory No. 5 has two critical flaws. First, Interrogatory No. 5 is vague and 15 ambiguous, leaving Defendant to wonder how it should compare price points over a period of 16 time that spans years. 17 Second, Interrogatory No. 5 appears unduly burdensome. Although the materials sought 18 by Interrogatory No. 5 may be relevant, Defendant provides the declaration of Wenzhi Wang, 19 Defendant’s Chairman, stating that “[a]ll responsive sales documents with regard to Hongxin’s 20 sales to non-U.S. customers during the term of the Distribution Agreement have been provided to 21 KIC already.” Dkt. 30, at 2:12–14. 22

24 1 g. Conclusion 2 Based on the foregoing, Plaintiff’s Motion to Compel Discovery should be granted, in 3 part, and denied, in part. In conformity with the discussion above, Defendant should provide 4 amended responses to RFA No. 5 and Interrogatory No. 1, to be served on Plaintiff no later than 5 April 27, 2020. Sanctions are not appropriate at this time. See Fed. R. Civ. P. 37(c).

6 III. ORDER 7 Therefore, it is hereby ORDERED that: 8 • Plaintiff’s Motion to Compel Discovery (Dkt. 26) is GRANTED, IN PART, 9 AND DENIED, IN PART; and 10 • In conformity with the discussion above, Defendant shall provide amended 11 responses to RFA No. 5 and Interrogatory No. 1, to be served on Plaintiff no later 12 than April 27, 2020. 13 The Clerk is directed to send uncertified copies of this Order to all counsel of record and 14 to any party appearing pro se at said party’s last known address.

15 Dated this 30th day of March, 2020. A 16

17 ROBERT J. BRYAN United States District Judge 18

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