HONORABLE RICHARD A. JONES 1
8 UNITED STATES DISTRICT COURT 9 WESTERN DISTRICT OF WASHINGTON AT SEATTLE 10 PHILIP SMITH, Case No. 2:23-cv-01887-RAJ 11 Plaintiff, ORDER 12 v. 13 COUPANG, INC., 14 Defendant. 15 16 I. INTRODUCTION 17 THIS MATTER comes before the Court on Defendant Coupang, Inc.’s Motion to 18 Bifurcate, Dkt. # 90, and Motion for Protective Order Staying Discovery Pending Motion 19 to Dismiss Ruling, Dkt. # 108. The Court has reviewed the motions, the submissions in 20 support of and in opposition to the motions, and the balance of the record. Coupang 21 requested oral argument on its bifurcation motion, but the Court finds oral argument is 22 unnecessary. For the reasons set forth below, the Court DENIES both motions. 23 II. BACKGROUND 24 Plaintiff Philip Smith, a former senior director of Defendant Coupang’s anti- 25 money laundering compliance team, alleges Coupang terminated him in retaliation for 26 1 raising protected whistleblower complaints. Following the Court’s order on Coupang’s 2 motion to dismiss the second amended complaint, two claims remain: a Sarbanes-Oxley 3 Act (“SOX”) whistleblower retaliation claim and a Washington wrongful termination 4 claim. Dkt. # 74. One issue in this case—and the basis of Coupang’s bifurcation 5 motion—is whether Mr. Smith’s SOX claim is barred by the applicable statute of 6 limitations. Dkt. # 90 at 2. This in turn depends on whether Coupang communicated its 7 termination decision to Mr. Smith prior to January 16, 2022. Id. The Court previously 8 denied Coupang’s motion to dismiss on statute of limitations grounds. Dkt. # 74 at 10. 9 It found “[t]here is substantial conduct alleged in the Complaint that demonstrates that 10 any adverse action taken against the employee was initially unclear in September 2021 11 when the company placed Smith on administrative lead, and termination was only 12 unquestionably communicated by the formal termination letter on January 18, 2022.” Id. 13 During discovery, Mr. Smith disclosed he began working for a new employer on 14 January 3, 2022. Dkt. # 106 at 2. At Coupang’s insistence, Mr. Smith filed a third 15 amended complaint to add this new fact, and Coupang again moved to dismiss, arguing 16 that this is a “disposition-altering allegation.” Id. Coupang argues this newly discovered 17 fact “confirms that Plaintiff understood Coupang had communicated a decision to 18 terminate” him prior to January 16, 2022. Id. at 3. In addition to the motion to dismiss, 19 Coupang also filed the motion to bifurcate and motion to stay discovery currently before 20 the Court. Dkts. # 90, 108. 21 III. MOTION TO BIFURCATE 22 Bifurcation “‘is the exception rather than the rule of normal trial procedure’ within 23 the Ninth Circuit.” Medtronic Minimed Inc. v. Animas Corp., No. 12-cv-4471, 2013 WL 24 3233341, at *2 (C.D. Cal. June 25, 2013) (quoting Clark v. IRS, 772 F. Supp. 2d 1265, 25 1269 (D. Haw. 2009)). “Parties requesting bifurcation of discovery have the burden of 26 1 proving that bifurcation will promote judicial economy and avoid inconvenience or 2 prejudice to the parties.” City of Sacramento v. Wells Fargo & Co., No. 18-cv-416, 2020 3 WL 6787134, at *2 (E.D. Cal. Oct. 9, 2020). “Courts consider several factors in 4 determining whether bifurcation is appropriate, including separability of the issues, 5 simplification of discovery and conservation of resources, and prejudice to the parties.” 6 Laatz v. Zazzle, Inc., No. 22-cv-4844, 2023 WL 8851631, at *2 (N.D. Cal. Dec. 21, 2023) 7 (quoting McDermott v. Potter, No. 07-cv-6300, 2010 WL 956808, at *1 (N.D. Cal. Mar. 8 12, 2010)).1 9 The Court declines to allow bifurcated pre-trial proceedings in this case. At this 10 stage, the Court takes no position regarding whether Coupang is likely to succeed on its 11 renewed statute of limitations argument on its pending motion to dismiss or in a later 12 summary judgment motion. It notes, however, that it previously denied Coupang’s 13 motion to dismiss on this issue. Dkt. # 74. In addition, even if the SOX claim is 14 determined time-barred, the parties dispute whether that dismissal will resolve Mr. 15 Smith’s Washington law claim. Dkt. # 90 at 7–9; Dkt. # 103 at 11. Given the uncertainty 16 on these issues, the Court cannot say that bifurcating discovery will promote efficient 17 resolution of this case. In addition, while statute of limitations is a distinct issue, 18 discovery on the topic will involve many of the same documents and witnesses as 19 discovery on the merits of Mr. Smith’s claims. Bifurcation may lead to additional 20 discovery disputes regarding what is properly within the scope of phase one of discovery, 21 as well as repeat depositions of the same witnesses if Coupang’s statute of limitations 22
23 1 This Court has previously expressed its reluctance to bifurcate pre-trial proceedings in civil cases. See CRS, LLC v. Valve Corp., No. 08-cv-361, 2008 WL 11343649, at *1 24 (W.D. Wash. Aug. 1, 2008) (“Discovery that is solely relevant to one issue is rare, and 25 the court is reluctant to encourage the parties to expend resources arguing over whether the discovery one party seeks belongs in one phase of discovery rather than another.”). 26 1 argument is rejected. Further, the Court does not agree with Coupang’s representation 2 that this case is in its early stages. This case has been open since December 2023, and 3 although much of the case so far has involved motion to dismiss briefing, the parties are 4 now solidly in the discovery phase and the discovery cutoff under the current scheduling 5 order is just four months away. Dkt. # 80. Finally, while Coupang raises concerns 6 regarding the scope and complexity of non-bifurcated discovery, those issues may be 7 raised in discovery motions if necessary. 8 IV. MOTION FOR PROTECTIVE ORDER 9 A district court has broad discretion to control discovery. Avila v. Willits Envtl. 10 Remediation Tr., 633 F.3d 828, 833 (9th Cir. 2011). Upon a showing of good cause, the 11 court may limit or deny discovery. Fed. R. Civ. P. 26(c). “A court may relieve a party 12 from the burdens of discovery while a dispositive motion is pending, but this is the 13 exception and not the rule.” Nw. Immigration Rights Project v. Sessions, No. 17-cv-716, 14 2017 WL 11428870, at *1 (W.D. Wash. Sept. 18, 2017). “A party seeking to stay 15 discovery bears a heavy burden to make a strong showing of why discovery should be 16 denied.” Wilmington Tr. Co. v. Boeing Co., No. 20-cv-402, 2020 WL 6060434, at *1 17 (W.D. Wash. Oct. 14, 2020) (citation and internal quotation marks omitted). “Neither 18 the mere existence of a potentially dispositive motion, nor mere inconvenience and 19 expense suffice to establish good cause for a stay.” Id. 20 “The Ninth Circuit does not appear to have set forth any rules or standards 21 governing such stays of discovery.” Hold Sec. LLC v. Microsoft Corp., No. 23-cv-899, 22 2023 WL 7920434, at *1 (W.D. Wash. Nov. 16, 2023). “As a result, courts often examine 23 the nature of the pending Rule 12(b) motion to determine whether a stay of discovery is 24 appropriate.” Id. Some courts have noted a stay is appropriate when the district court is 25 “convinced that the plaintiff will be unable to state a claim for relief.” Id. (quoting 26 1 Wenger v. Monroe, 282 F.3d 1068, 1077 (9th Cir. 2002)).
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HONORABLE RICHARD A. JONES 1
8 UNITED STATES DISTRICT COURT 9 WESTERN DISTRICT OF WASHINGTON AT SEATTLE 10 PHILIP SMITH, Case No. 2:23-cv-01887-RAJ 11 Plaintiff, ORDER 12 v. 13 COUPANG, INC., 14 Defendant. 15 16 I. INTRODUCTION 17 THIS MATTER comes before the Court on Defendant Coupang, Inc.’s Motion to 18 Bifurcate, Dkt. # 90, and Motion for Protective Order Staying Discovery Pending Motion 19 to Dismiss Ruling, Dkt. # 108. The Court has reviewed the motions, the submissions in 20 support of and in opposition to the motions, and the balance of the record. Coupang 21 requested oral argument on its bifurcation motion, but the Court finds oral argument is 22 unnecessary. For the reasons set forth below, the Court DENIES both motions. 23 II. BACKGROUND 24 Plaintiff Philip Smith, a former senior director of Defendant Coupang’s anti- 25 money laundering compliance team, alleges Coupang terminated him in retaliation for 26 1 raising protected whistleblower complaints. Following the Court’s order on Coupang’s 2 motion to dismiss the second amended complaint, two claims remain: a Sarbanes-Oxley 3 Act (“SOX”) whistleblower retaliation claim and a Washington wrongful termination 4 claim. Dkt. # 74. One issue in this case—and the basis of Coupang’s bifurcation 5 motion—is whether Mr. Smith’s SOX claim is barred by the applicable statute of 6 limitations. Dkt. # 90 at 2. This in turn depends on whether Coupang communicated its 7 termination decision to Mr. Smith prior to January 16, 2022. Id. The Court previously 8 denied Coupang’s motion to dismiss on statute of limitations grounds. Dkt. # 74 at 10. 9 It found “[t]here is substantial conduct alleged in the Complaint that demonstrates that 10 any adverse action taken against the employee was initially unclear in September 2021 11 when the company placed Smith on administrative lead, and termination was only 12 unquestionably communicated by the formal termination letter on January 18, 2022.” Id. 13 During discovery, Mr. Smith disclosed he began working for a new employer on 14 January 3, 2022. Dkt. # 106 at 2. At Coupang’s insistence, Mr. Smith filed a third 15 amended complaint to add this new fact, and Coupang again moved to dismiss, arguing 16 that this is a “disposition-altering allegation.” Id. Coupang argues this newly discovered 17 fact “confirms that Plaintiff understood Coupang had communicated a decision to 18 terminate” him prior to January 16, 2022. Id. at 3. In addition to the motion to dismiss, 19 Coupang also filed the motion to bifurcate and motion to stay discovery currently before 20 the Court. Dkts. # 90, 108. 21 III. MOTION TO BIFURCATE 22 Bifurcation “‘is the exception rather than the rule of normal trial procedure’ within 23 the Ninth Circuit.” Medtronic Minimed Inc. v. Animas Corp., No. 12-cv-4471, 2013 WL 24 3233341, at *2 (C.D. Cal. June 25, 2013) (quoting Clark v. IRS, 772 F. Supp. 2d 1265, 25 1269 (D. Haw. 2009)). “Parties requesting bifurcation of discovery have the burden of 26 1 proving that bifurcation will promote judicial economy and avoid inconvenience or 2 prejudice to the parties.” City of Sacramento v. Wells Fargo & Co., No. 18-cv-416, 2020 3 WL 6787134, at *2 (E.D. Cal. Oct. 9, 2020). “Courts consider several factors in 4 determining whether bifurcation is appropriate, including separability of the issues, 5 simplification of discovery and conservation of resources, and prejudice to the parties.” 6 Laatz v. Zazzle, Inc., No. 22-cv-4844, 2023 WL 8851631, at *2 (N.D. Cal. Dec. 21, 2023) 7 (quoting McDermott v. Potter, No. 07-cv-6300, 2010 WL 956808, at *1 (N.D. Cal. Mar. 8 12, 2010)).1 9 The Court declines to allow bifurcated pre-trial proceedings in this case. At this 10 stage, the Court takes no position regarding whether Coupang is likely to succeed on its 11 renewed statute of limitations argument on its pending motion to dismiss or in a later 12 summary judgment motion. It notes, however, that it previously denied Coupang’s 13 motion to dismiss on this issue. Dkt. # 74. In addition, even if the SOX claim is 14 determined time-barred, the parties dispute whether that dismissal will resolve Mr. 15 Smith’s Washington law claim. Dkt. # 90 at 7–9; Dkt. # 103 at 11. Given the uncertainty 16 on these issues, the Court cannot say that bifurcating discovery will promote efficient 17 resolution of this case. In addition, while statute of limitations is a distinct issue, 18 discovery on the topic will involve many of the same documents and witnesses as 19 discovery on the merits of Mr. Smith’s claims. Bifurcation may lead to additional 20 discovery disputes regarding what is properly within the scope of phase one of discovery, 21 as well as repeat depositions of the same witnesses if Coupang’s statute of limitations 22
23 1 This Court has previously expressed its reluctance to bifurcate pre-trial proceedings in civil cases. See CRS, LLC v. Valve Corp., No. 08-cv-361, 2008 WL 11343649, at *1 24 (W.D. Wash. Aug. 1, 2008) (“Discovery that is solely relevant to one issue is rare, and 25 the court is reluctant to encourage the parties to expend resources arguing over whether the discovery one party seeks belongs in one phase of discovery rather than another.”). 26 1 argument is rejected. Further, the Court does not agree with Coupang’s representation 2 that this case is in its early stages. This case has been open since December 2023, and 3 although much of the case so far has involved motion to dismiss briefing, the parties are 4 now solidly in the discovery phase and the discovery cutoff under the current scheduling 5 order is just four months away. Dkt. # 80. Finally, while Coupang raises concerns 6 regarding the scope and complexity of non-bifurcated discovery, those issues may be 7 raised in discovery motions if necessary. 8 IV. MOTION FOR PROTECTIVE ORDER 9 A district court has broad discretion to control discovery. Avila v. Willits Envtl. 10 Remediation Tr., 633 F.3d 828, 833 (9th Cir. 2011). Upon a showing of good cause, the 11 court may limit or deny discovery. Fed. R. Civ. P. 26(c). “A court may relieve a party 12 from the burdens of discovery while a dispositive motion is pending, but this is the 13 exception and not the rule.” Nw. Immigration Rights Project v. Sessions, No. 17-cv-716, 14 2017 WL 11428870, at *1 (W.D. Wash. Sept. 18, 2017). “A party seeking to stay 15 discovery bears a heavy burden to make a strong showing of why discovery should be 16 denied.” Wilmington Tr. Co. v. Boeing Co., No. 20-cv-402, 2020 WL 6060434, at *1 17 (W.D. Wash. Oct. 14, 2020) (citation and internal quotation marks omitted). “Neither 18 the mere existence of a potentially dispositive motion, nor mere inconvenience and 19 expense suffice to establish good cause for a stay.” Id. 20 “The Ninth Circuit does not appear to have set forth any rules or standards 21 governing such stays of discovery.” Hold Sec. LLC v. Microsoft Corp., No. 23-cv-899, 22 2023 WL 7920434, at *1 (W.D. Wash. Nov. 16, 2023). “As a result, courts often examine 23 the nature of the pending Rule 12(b) motion to determine whether a stay of discovery is 24 appropriate.” Id. Some courts have noted a stay is appropriate when the district court is 25 “convinced that the plaintiff will be unable to state a claim for relief.” Id. (quoting 26 1 Wenger v. Monroe, 282 F.3d 1068, 1077 (9th Cir. 2002)). Courts also consider “whether 2 the motion involves pure questions of law that are dispositive—such as subject matter 3 jurisdiction or immunity—rather than fact-intensive inquiries that might be resolved by 4 further discovery.” Id. (citing Little v. City of Seattle, 863 F.2d 681, 685 (9th Cir. 1988)).2 5 As stated above, the Court takes no position regarding the likely success of the 6 pending motion to dismiss. Based on a preliminary review, however, the Court is not 7 “convinced” that the case must be dismissed and instead finds a “thorough analysis of 8 the parties’ arguments in relation to the motion to dismiss is necessary.” Wilmington, 9 2020 WL 6060434, at *2. This does not weigh in favor of a stay. Id. Moreover, the 10 statute of limitations dispute does not involve pure questions of law. Indeed, Coupang’s 11 own motion for bifurcation acknowledges some further limited discovery could be 12 necessary. This again does not weigh in favor of a stay. Finally, as noted above, the 13 parties dispute whether a finding that the SOX claim is barred by the statute of limitations 14 will also dispose of the Washington law claim, and thus resolve the entire case. 15 Considering these factors together, the Court does not find Coupang has met its burden 16 of showing this case is the exception to the general rule that discovery should proceed 17 while a dispositive motion is pending. 18 // 19 // 20 // 21
22 2 Both parties cite the following test applied by some district courts in this circuit: (1) whether the pending motion could dispose of the entire case; and (2) whether the motion 23 could be decided without additional discovery. Dkt. #108 at 7–8; Dkt. # 110 at 5. As one court observed, however, “such a test would seemingly require most Rule 12(b)(6) 24 motions—which generally seek dismissal of a case and require the complaint be taken as 25 true, without additional discovery—to warrant a stay.” Hold, 2023 WL 7920434, at *2. For this reason, the Court is not inclined to apply this test. 26 1 V. CONCLUSION 2 For the foregoing reasons, the Court DENIES Coupang’s Motion to Bifurcate, 3 Dkt. # 90 and Motion for Protective Order Staying Discovery Pending Motion to Dismiss 4 Ruling, Dkt. # 108.
5 6 Dated this 2nd day of December, 2025. 7
8 A
9 10 The Honorable Richard A. Jones United States District Judge 11
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