Stout v. Remetronix, Inc.

298 F.R.D. 531, 2014 WL 1416925, 2014 U.S. Dist. LEXIS 52836
CourtDistrict Court, S.D. Ohio
DecidedJanuary 17, 2014
DocketNo. 3:13-CV-26
StatusPublished
Cited by14 cases

This text of 298 F.R.D. 531 (Stout v. Remetronix, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stout v. Remetronix, Inc., 298 F.R.D. 531, 2014 WL 1416925, 2014 U.S. Dist. LEXIS 52836 (S.D. Ohio 2014).

Opinion

ORDER

MICHAEL J. NEWMAN, United States Magistrate Judge.

Now before the Court is Defendants’ motion for a Protective Order (doc. 26), Plaintiffs’ memorandum in opposition (doc. 29), and Defendants’ reply (doc. 30).1 Defendants seek to prevent the disclosure of project hour sheets used in pricing their products or, in the alternative, limit discovery to attorneys’ eyes only (“AEO”). Doc. 26 at PagelD 7978.

I. FACTS

Plaintiff, James K. Stout, filed this complaint alleging that Defendants, Remetronix, Inc. and TechMed Solutions, Inc., unlawfully failed to pay appropriate minimum wage and overtime compensation to employees who are non-exempt under the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201, et seq., and the Ohio Minimum Fair Wage Standards Act (“OMFWSA”), Ohio Rev.Code § 4111, et seq. Doc. 1 at PagelD 5-9. Stout seeks to pursue this case on behalf of himself and all other similarly situated employees as a collective action pursuant to FLSA’s opt-in provision.2 29 U.S.C. § 216(b); doe. 4. The Court granted conditional class certification on August 9, 2013. Doc. 13. The conditional class consists of all current and former field technicians employed by Defendants who could pursue claims for overtime and wage violations. Id. at PagelD 7917-18. To date, fifteen Plaintiffs have given consent to opt-in. Docs. 23, 25, 27.

During the course of discovery, Plaintiffs requested information regarding Defendants’ pricing of their projects. Doc. 26 at PagelD 7978. Defendants objected to the production of project hour sheets arguing, first, that the project hour sheets are irrelevant; and, second, that they contain trade secrets. Id. [534]*534Plaintiffs contend the documents contain information related to the amount of time spent by Defendants’ field technicians performing on-site work. Therefore, Plaintiffs suggest, the documents are relevant to their FLSA and OMFWSA claims, and merit production. Doc. 29 at PagelD 7990-91. With respect to the trade secrets argument, Plaintiffs suggest that a properly drafted Protective Order can reasonably limit the scope and extent of disclosure. Id. at PagelD 7990-92. Defendants counter that such a Protective Order must be AEO. Doc. 30 at PagelD 8000-02.

II. ANALYSIS

Fed.R.Civ.P. 26(b)(1) provides that “[p]arties may obtain discovery regarding any nonprivileged matter that is relevant to any party’s claim or defense.” Further, “[r]elevant information need not be admissible at trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence.” Id. This provides the District Court with broad discretion to determine the proper scope of discovery. See Lewis v. ACB Bus. Servs., Inc., 135 F.3d 389, 402 (6th Cir.1998).

A. Relevancy

The Court finds fault with Defendants’ argument that the project hour sheets are irrelevant to Plaintiffs’ claims. The conditional class consists of hourly, non-exempt employees, who seek recovery for unpaid and overtime wages pursuant to FLSA and Ohio law. Id. Plaintiffs’ complaint alleges that Defendants failed to pay their field technicians for time spent on required administrative tasks after leaving the worksite and time on-site that exceeded a pre-determined number. Doc. 1 at PagelD 6. The affidavit of Jonathon Price, a former field technician at Remetronix and opt-in Plaintiff, for example, alleges that he was not compensated for required administrative tasks. Doc. 29-1 at PagelD 7994-97. Price provides that he and other field technicians were paid for a predetermined number of hours per installation, regardless of actual time spent. Id. at Pa-gelD 7996-97. This time did not account for various offsite administrative tasks he was required to perform, and he was not otherwise permitted to bill for this time. Id. The information contained in these documents' — ■ namely, the number of hours Defendants allocate to complete an installation — relates directly to Plaintiffs’ claims for unpaid wages and/or overtime. Plaintiffs allege that the cap on hours was determined, at least in part, by reference to the project hour sheets. Doc. 29 at PagelD 7991. Access to this information is necessary for Plaintiffs to attempt to establish that they were not properly compensated for hours worked.

B. Trade Secrets

In the exercise of its discretion, the Court may, upon a showing of good cause, issue a Protective Order limiting or restricting discovery. Fed.R.Civ.P. 26(c). Specifically, the Court may issue an order “requiring that a trade secret or other confidential ... commercial information not be revealed or be revealed only in a specified way.” Fed. R.Civ.P. 26(c)(1)(G). A Protective Order with an AEO designation serves to limit disclosure of trade secret information to the opposing party’s attorneys and expert witnesses only. See Penn, LLC v. Prosper Bus. Dev. Corp., No. 2:10-cv-0993, 2012 WL 5948363, at *4 (S.D.Ohio Nov. 28, 2012).

“The burden of establishing good cause for a [P]rotective [OJrder rests with the movant.” Nix v. Sword, 11 Fed.Appx. 498, 500 (6th Cir.2001). To demonstrate good cause, the movant “must articulate specific facts showing clearly defined and serious injury resulting from the discovery sought and cannot rely on mere conclusory statements.” Id.; see also Nemir v. Mitsubishi Motors Corp., 381 F.3d 540, 550 (6th Cir.2004) (explaining that the party seeking a Protective Order must describe the alleged harm it will suffer with “a particular and specific demonstration of fact, as distinguished from stereotyped and conclusory statements” (quoting Gulf Oil Co. v. Bernard, 452 U.S. 89, 102 n. 16, 101 S.Ct. 2193, 68 L.Ed.2d 693 (1981))). “The mere presence of ‘trade secrets’ does not automatically entitle the producing party to an AEO [Protective [OJrder. The burden remains on the producing party to show that AEO protection [535]*535is warranted.” Penn, LLC, 2012 WL 5948363, at *4.

The party seeking an AEO Protective Order must identify with sufficient particularity the harm it will suffer. “In the business context, such a showing requires ‘specific demonstrations of fact, supported where possible by affidavits and concrete examples.’ ” Id. (quoting Deford v. Schmid Prods. Co., 120 F.R.D. 648, 653 (D.Md.1987)). AEO designation can be justified upon a specific factual showing that “especially sensitive information is at issue or the information is to be provided to a competitor.” United States ex rel. Daugherty v.

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298 F.R.D. 531, 2014 WL 1416925, 2014 U.S. Dist. LEXIS 52836, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stout-v-remetronix-inc-ohsd-2014.