SiteLock LLC v. GoDaddy.com LLC

CourtDistrict Court, D. Arizona
DecidedJuly 1, 2020
Docket2:19-cv-02746
StatusUnknown

This text of SiteLock LLC v. GoDaddy.com LLC (SiteLock LLC v. GoDaddy.com LLC) is published on Counsel Stack Legal Research, covering District Court, D. Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
SiteLock LLC v. GoDaddy.com LLC, (D. Ariz. 2020).

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 SiteLock LLC, No. CV-19-02746-PHX-DWL

10 Plaintiff, ORDER

11 v.

12 GoDaddy.com LLC,

13 Defendant. 14 15 On June 5, 2020, Defendant GoDaddy.com, LLC (“GoDaddy”) filed a pair of 16 motions: (1) a motion that challenges Plaintiff SiteLock LLC’s (“SiteLock”) decision to 17 designate as “Confidential—For Counsel Only” a particular category of documents that 18 SiteLock recently produced during discovery (Doc. 50) and (2) a motion for a 60-day 19 extension of all case management deadlines (Doc. 57). The motions are fully briefed 20 (Docs. 64, 65, 76, 78) and nobody has requested oral argument. For the following reasons, 21 the first motion will be granted and the second motion will be denied without prejudice. 22 BACKGROUND 23 I. Parties And Claims 24 This action was initiated in April 2019. (Doc. 1.) In the complaint, SiteLock asserts 25 a variety of claims against GoDaddy arising from a “Reseller Agreement” the parties 26 executed in 2013, “under which GoDaddy agreed to market and sell SiteLock’s website 27 security services to GoDaddy’s customers . . . as part of the larger suite of web services 28 offered by GoDaddy.” (Id. ¶ 3.) “When a customer ordered a subscription to SiteLock’s 1 services through GoDaddy’s platform, the customer had the right to use the purchased 2 SiteLock service for a set period of time.” (Id. ¶ 4.) “[T]he customer paid GoDaddy for 3 the SiteLock service at the time of the order, regardless of whether the customer later 4 activated or used the service.” (Id.) 5 SiteLock’s primary claim is that “GoDaddy . . . breach[ed] the Agreement by 6 willfully failing to pay SiteLock for each customer ‘order’ of a SiteLock ‘subscription.’” 7 (Id. ¶ 7.) “Instead, GoDaddy paid SiteLock only if a customer ordered a SiteLock 8 subscription and then subsequently activated SiteLock’s services.” (Id.) “That is, if a 9 customer ordered a SiteLock subscription through GoDaddy’s platform (and therefore paid 10 GoDaddy for it) but did not subsequently activate the services, GoDaddy pocketed the 11 customer’s entire payment without paying SiteLock anything.” (Id.) SiteLock also alleges 12 other contractual breaches, one of which—GoDaddy’s alleged “deceptive use of 13 SiteLock’s name to promote [GoDaddy’s] own competing service,” Sucuri—also serves 14 as the basis for Lanham Act and state-law unfair competition claims. (Id. ¶¶ 10-11.) 15 GoDaddy disputes these allegations. In the parties’ Rule 26(f) report, it summarized 16 its position as follows:

17 From the inception of the parties’ relationship, SiteLock was aware that it received payments for product activations only, and not for product sales. 18 This understanding was consistent with (a) the parties’ agreement, which entitled SiteLock to invoice GoDaddy for product activations only, and (b) 19 SiteLock’s monthly invoices to GoDaddy, which detailed the licensing fees owed for customers who activated their SiteLock products. SiteLock 20 reaffirmed this understanding in the Third Addendum to the Agreement, which SiteLock proposed with the hope of increasing product activations so 21 that SiteLock could claim more revenue. As a result, SiteLock’s first breach of contract claim is a misguided attempt to renegotiate the parties’ 22 contractual relationship after termination. 23 (Doc. 20 at 5-6.) GoDaddy also contends that SiteLock’s remaining contractual claims, 24 Lanham Act claim, and state-law claim lack merit. (Id. at 6-7.) 25 II. Procedural History 26 On September 9, 2019, the Court issued the Rule 16 scheduling order. (Doc. 22.) 27 Based on the parties’ representation in their Rule 26(f) report that they “do not currently 28 anticipate the need to add additional parties or amend or supplement the pleadings” (Doc. 1 20 at 3), the Court set a deadline of October 9, 2019 to amend the pleadings. (Doc. 22 at 2 1.) Additionally, the Court set a deadline of June 1, 2020 for “final supplementation of 3 MIDP responses and the completion of fact discovery.” (Id. at 2.) 4 On October 3, 2019, at the parties’ request, the Court issued a protective order. 5 (Doc. 25.) 6 On February 28, 2020, the parties brought a large number of discovery disputes to 7 the Court’s attention. (Docs. 32, 33, 34.) Among other things, the parties disputed whether 8 SiteLock should be required to produce its contracts with other third-party resellers (which 9 GoDaddy had requested in its fifth and seventh requests for production).1 GoDaddy argued 10 these contracts were discoverable for two reasons: (1) they contain “SiteLock’s pricing 11 terms with third parties,” which are relevant to SiteLock’s alleged damages; and (2) 12 because this case turns on “the interpretation of various contractual terms” in the Reseller 13 Agreement, GoDaddy is “entitled to discovery regarding . . . SiteLock’s historical use of 14 definitions in relation to—or constructions of—the key words” in other contracts. (Doc. 15 34 at 2.) SiteLock disagreed, arguing that (1) its contracts with other third-party resellers 16 are not relevant to damages and (2) “[t]hose separate contracts are irrelevant to the parties’ 17 intent in the separate SiteLock-GoDaddy contract.” (Id. at 3.) 18 On March 5, 2020, the Court held a two-hour hearing in an attempt to resolve the 19 parties’ discovery disputes. (Doc. 36.) During this hearing, it became increasingly 20 apparent that the parties hadn’t adequately met and conferred beforehand. The Court even 21 remarked on this failure in the minute entry issued following the hearing. (Id. at 2 [“The 22 Court reminds counsel that they must meet and confer to resolve discovery issues without 23 the Court’s intervention . . . .”].) 24 As for the dispute over SiteLock’s contracts with other third-party resellers, the 25 Court noted that, under the law of at least some states, it is permissible for a party in a 26 1 Specifically, in RFP #5, GoDaddy requested “ALL DOCUMENTS that use, or 27 define the term ‘signups,’ including all of YOUR reseller agreements with THIRD PARTIES that include the term.” (Doc. 34-1 at 13.) In RFP #7, GoDaddy requested “All 28 of YOUR reseller agreements with THIRD PARTY hosting companies dating from November 1, 2008 to the present day.” (Id.) 1 breach-of-contract action to present evidence that the opposing party, during dealings with 2 third parties, adopted an interpretation of a particular term that is different from the 3 interpretation being pursued in the pending action.2 Thus, given that “under Rule 26 the 4 test for . . . discoverability isn’t whether a particular piece of evidence ultimately will be 5 admissible at trial,” and because “some of these other contracts might end up having some 6 relevance for purposes of figuring out what the parties’ subjective intention was at the time 7 they entered into this contract,” the Court concluded that SiteLock’s contracts with other 8 third-party resellers were “within the realm of discoverability.” However, the Court only 9 ordered the production of third-party reseller contracts executed in or before July 2016. 10 (See also Doc. 36 at 2 [“GoDaddy’s motion to compel is granted as to RFP #5 and RFP #7, 11 for the reasons discussed on the record.”]; Doc. 67 ¶¶ 4-5 [summarizing outcome of 12 hearing].) 13 On March 31, 2020, GoDaddy filed a motion requesting a two-month extension of 14 all “outstanding deadlines in this matter” in light of the COVID-19 pandemic and the 15 illness of GoDaddy’s counsel. (Doc. 37.) Over SiteLock’s opposition (Doc. 42), the Court 16 granted the motion. (Doc. 44.) As a result, the deadline for answers to interrogatories and 17 the production of documents was extended to June 22, 2020, and the deadline for the 18 completion of fact discovery was extended to August 3, 2020. (Id.) In contrast, the 19 deadline for amending the pleadings was not extended (because it had already expired).

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Bluebook (online)
SiteLock LLC v. GoDaddy.com LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sitelock-llc-v-godaddycom-llc-azd-2020.