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Vesta Corp. v. Amdocs Management Ltd.

United States District Court, D. Oregon

February 1, 2018

VESTA CORPORATION, Plaintiff,
v.
AMDOCS MANAGEMENT LIMITED and AMDOCS, INC., Defendants.

          STEPHEN ENGLISH ERICK J. HAYNIE JULIA E. MARKLEY PERKINS COIE, LLP ATTORNEYS FOR PLAINTIFF

          ROBERT A. SHLACHTER JOSHUA L. ROSS STOLL STOLL BERNE LOKTING & SHLACHTER P.C. BRUCE G. VANYO RICHARD H. ZELICHOV CHRISTINA L. COSTLEY KATTEN MUCHIN ROSENMAN LLP ATTORNEYS FOR DEFENDANTS

          OPINION & ORDER

          MARCO A. HERNÁNDEZ UNITED STATES DISTRICT JUDGE

         Plaintiff Vesta Corporation brings this Motion for Imposition of Sanctions against Defendants Amdocs Management Limited and Amdocs, Inc. Pl.'s Mot. Sanc., ECF 524. Plaintiff contends that Defendants “denied and actively concealed evidence” that they targeted Plaintiff's customers AT&T and Cricket. Id. at vii. Plaintiff requests the Court sanction Defendants by providing additional time for discovery, informing the jury of Defendants' misconduct, instructing the jury that they may consider the alleged misconduct in their deliberations, and awarding monetary sanctions. Id. at 17-20. The Court grants Plaintiff's motion in part. The Court will allow Plaintiff additional discovery related to AT&T and Cricket and award monetary sanctions. However, the Court declines to award additional sanctions at this time.

         BACKGROUND

         Plaintiff Vesta, an electronic payments and fraud prevention technology company, has sued Defendants Amdocs Management Limited and Amdocs, Inc. (collectively, “Defendants”), telephone billing software and services companies, for breach of contract and misappropriation of trade secrets. Fourth Am. Compl. Intro, ECF 405. Specifically, Plaintiff alleges that in the course of collaborating on various projects and the attempted acquisitions of Plaintiff by Defendants, Plaintiff shared “highly confidential and proprietary information, ” which Defendants used and relied upon “improperly to create, price and sell a competing product in order to increase its profits.” Id. As a result of Defendants' misappropriation and breach of contract, Plaintiff alleges it “suffered lost profits and royalties on various accounts, including MetroPCS, Sprint and T-Mobile.” Id. at ¶¶ 79, 85, 95, 108.

         At various points in this litigation, Plaintiff has sought information pertaining to Defendants attempts to sell their product to AT&T and Cricket. In September of 2015, Plaintiff propounded Interrogatory No. 4, which requested Defendants “state with specificity each customer or potential customer that [Defendants] have sold or attempted to sell [their] Payment Solution.” Markley Decl. Ex. 12, at 10, ECF 525. After Defendants initially did not respond, the Court ordered Defendants to answer Interrogatory 4. Opinion & Order, April 4, 2016, ECF 221. Defendants responded almost three weeks later and indicated that they had “sold or provided sales proposals concerning its enterprise payment processing (“EPP”) solution to” MetroPCS, Sprint, T-Mobile, Comcast, and Cablevision. Markley Decl. Ex. 15, at 8, ECF 526.

         In September of 2016, Plaintiff issued Requests for Production 108 and 109, which sought documents related to Defendants' pitch of EPP products to AT&T and Cricket. Pl.'s Mot. Sanc. 5 (citing Markley Decl. Ex. 16, ECF 525). Defendants again declined to respond. Id. Plaintiff sought the Court's assistance, but it declined to compel Defendants' response. Markley Decl. Ex. 17, ECF 525 (Hearing, Sept. 15, 2016, at 66:1-17). At that time, Plaintiff could not identify for the Court any reason it believed that Defendants had a connection to AT&T or Cricket. Id. Plaintiff only stated that it “might have seen something about [Cricket and AT&T] in the documents produced on September 13.” Id. In its motion, Plaintiff emphasizes that Defendants remained silent during this discussion. Pl.'s Mot. Sanc. 6.

         On May 12, 2017, Plaintiff took a 30(b)(6) deposition of Manuel Zepeda on topics related to Defendants' marketing of their payment solution to other companies. Markley Decl. Exs. 18, 19, ECF 525. During that deposition, Plaintiff asked Mr. Zepeda if he was “aware that [Defendants] attempted to market [their payment solution] to AT&T” and if he was “aware of any other entity that [Defendants] attempted to market [their] payment solution to besides” Sprint, MetroPCS, T-Mobile, Comcast, and Cablevision. Id. at Ex. 19 (Zepeda Dep. 111:3-10). To both questions, Mr. Zepeda answered “No.” Id.

         In preparation for the the May 23, 2017, deposition of Defendants' witness Howard Connors, Plaintiff uncovered evidence that suggested Defendants had attempted to sell a competing product to AT&T and Cricket. Pl.'s Mot. Sanc. 7 (citing Markley Decl. Ex. 20-21, ECF 526). Plaintiff used that evidence at Mr. Connors's deposition, and he admitted to his participation in meetings with Cricket about Defendants' product and his knowledge of Defendants' efforts to sell its product to AT&T. Markley Decl. Ex. 22, ECF 526 (Connors Dep. 60:15-63:12; 139:22-140:25; 143:25-144:18).

         In the months that followed, Plaintiff again sought documents related to Defendants' external communications with AT&T and Cricket with the assistance of the Court. Hearing, Aug. 1, 2017, ECF 455; Order, Sept. 12, 2017, ECF 490. The “Court granted, without limitation, Vesta's request for Amdocs' pitches and proposals of its EPP product to AT&T and Cricket and, relatedly, Amdocs' communications with AT&T and Cricket about Vesta and processing payments.” Order, ECF 490. Defendants appear to have provided some documents pertaining to Defendants' external communications regarding Cricket and AT&T. Pl.'s Mot. Sanc. 8.

         On November 3, 2017, Plaintiff emailed Defendants regarding the present motion, and the parties conferred on this issue. Zelichov Decl. Ex. 3, ECF 530. Defendants indicated they were willing to provide internal correspondence regarding sales pitches to AT&T and Cricket. Id. at 3, 5. Plaintiff declined their offer on the grounds that it “still falls short of the discovery Vesta seeks” and filed this motion. Id. at 1.

         STANDARDS

         Rule 26 imposes a duty on counsel to certify “the lawyer has made a reasonable effort to assure that the client has provided all information and documents available to him that are responsive to the discovery demand.” Fed.R.Civ.P. 26(g), 1983 advisory committee note. Rule 26 also requires parties to supplement their disclosures, interrogatories, requests for production, or requests for admission “in a timely manner if the party learns that in some material respect the disclosure or response is incomplete or incorrect and . . . the additional or corrective information has not otherwise been made known to the other parties during the discovery process or in writing.” Fed. R. Civ. Pro. 26(e)(1)(A). Under Rule 30(b)(6), when an organization is named as a deponent, it must “designate one or more officers, directors, or managing agents . . . to testify on its behalf.” Fed. R. Civ. Pro. 30(b)(6). ...


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