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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
BREAKING CODE SILENCE,
Plaintiff,
v.
MCNAMARA, et al.,
Defendants.
Case No. 2:22-cv-02052-MAA
ORDER GRANTING IN PART AND
DENYING IN PART DEFENDANTS
McNAMARA’S AND
JEREMY WHITELEY’S MOTION FOR
EVIDENTIARY AND MONETARY
SANCTIONS UNDER RULE 37 OF THE
FEDERAL RULES OF CIVIL
PROCEDURE (ECF NO. 98)
I. INTRODUCTION
Filed on July 14, 2023 and presently before the Court—in this nowdismissed matter1
—is Defendants McNamara’s and Jeremy Whiteley’s
Motion for Evidentiary and Monetary Sanctions Under Rule 37 of the Federal
Rules of Civil Procedure (“Motion”). (Mot., ECF No. 98.) The Motion was filed
1 On April 8, 2024, almost eleven months after the filing of the instant motion,
Plaintiff BCS filed a request for voluntary dismissal of the case with prejudice
pursuant to Federal Rule of Civil Procedure (“Rule”) 41(a)(2). (ECF No. 198.)
The Court granted BCS’s request on May 8, 2024. (ECF No. 210.)
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jointly by Defendants McNamara (“McNamara”) and Jeremy Whiteley
(“Whiteley”) (together “Defendants”) on the one hand, and Plaintiff Breaking
Code Silence (“BCS”) on the other, in the form of a Joint Stipulation as required
by Central District of California Local Civil Rule (“Local Rule”) 37-2. (Id. at 2–
3.
2
) As more fully explained below, because BCS voluntarily dismissed the case
before the Motion was resolved, Defendants’ request for evidentiary sanctions is
moot and the only question pending before the Court is Defendants’ request for
monetary sanctions. (ECF No. 210.)
In support of the Motion, Defendants filed the Declaration of M. Adam Tate
(“Tate Declaration”) (Tate Decl., ECF No. 98-1) with Defendants’ Exhibits 1
through 15 (Def. Exs., ECF Nos. 98-2–98-16), the Declaration of Catherine A.
Close (ECF No. 98-17) with Defendants’ Exhibits 16 through 21 (Def. Exs., ECF
Nos. 98-18–98-23), the Declaration of Jeremy Whiteley (ECF No. 98-24), and the
Declaration of McNamara (ECF No. 98-25).
BCS opposes the Motion. (See generally Mot.) In support of its opposition,
BCS filed the Declaration of Jason Lueddeke (ECF No. 98-26) with Plaintiff’s
Exhibits A through I (Pl. Exs., ECF Nos. 98-27–98-35), the Declaration of Denette
King (“King Declaration”) (King Decl., ECF No. 98-36), the Declaration of Dee
Anna Hassanpour (“Hassanpour Declaration”) (Hassanpour Decl., ECF No. 98-37),
the Declaration of Jennifer Magill (ECF No. 98-38), the Declaration of Dorit
Saberi (“Saberi Declaration”) (Saberi Decl., ECF No.98-39), and Plaintiff’s
Supplemental Memorandum (“Plaintiff’s Supplemental Memorandum”) (Pl. Suppl.
Memo., ECF No. 113).
In response to a concern expressed by the Court during an informal discovery
conference held on August 9, 2024, and to request attorneys’ fees expended in
connection with, but after the filing of, the Motion, Defendants filed a
2 Pinpoint cites citations of page numbers in the Order refer to the page numbers
appearing in the ECF-generated headers of cited documents.
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Supplemental Declaration of M. Adam Tate (“Tate Supplemental Declaration”).
(Tate Suppl. Decl., ECF No. 129.)
In response to a request by the Court that Defendants provide updated and
detailed information regarding the requested attorneys’ fees and that Plaintiff
provide its response thereto, the parties filed a Joint Stipulation re: Attorney’s Fees
on Sanctions Motion (“Motion Supplement”). (Mot. Suppl., ECF No. 211, at 4–5.)
In support of the Motion Supplement, Defendants filed another Declaration of M.
Adam Tate (“Tate Third Declaration”) (Tate Third Decl., ECF No. 211-1), with
Defendants’ Exhibits 1-2 through 12-23 (Def. Exs. 1-2–12-2, ECF Nos. 211-2–211-
13).
Having read and considered the papers by the parties and other records in this
case as detailed below, the undersigned finds the Motion suitable for disposition
without a hearing. See Fed. R. Civ. P. 78; C.D. Cal. L.R. 7-15. For the reasons set
forth below, the Court GRANTS in part and DENIES in part the Motion.
II. FACTUAL BACKGROUND
A. BCS’s Allegations
BCS brought this action under the Computer Fraud and Abuse Act (18
U.S.C. § 1030) (“CFAA”), and the California Computer Data Access and Fraud Act
(Cal. Penal Code § 502) (“CDAFA”) (“Complaint”). (Compl., ECF No. 2.) Based
on the Joint Stipulation to Strike Allegations and Limit Claims, the parties agreed to
narrow the claims asserted in the Complaint to the allegation that Defendants
accessed a BCS computer or account without authorization, or in excess of
authorized access, and caused BCS’s website (breakingcodesilence.org and/or
breakingcodesilence.com) to be de-indexed. (ECF Nos. 146–47.)
3 To distinguish between Defendants’ first and second sets of Exhibits 1 through 13,
the Court denotes the second set by adding “-2” to each exhibit number.
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According to the Complaint,4 on or about March 10, 2022, Defendants
accessed BCS’s website account with Google without permission or authorization
from BCS and caused the website to be deindexed on Google. (Compl. 10.) The
effect of the deindexing was that no one could find BCS’s website on Google. (Id.
at 11.) The timing of the deindexing was problematic for BCS because, earlier that
day, BCS had been featured on a television show and expected a rise in website
traffic and, in turn, donations. (Id.) In addition, a made-for-TV film about the
stories of two troubled-teen industry survivors that highlighted BCS’s work was
being promoted around this same time and was scheduled to debut on March 12,
2022, which also was expected to result in a rise in website traffic and donations.
(Id.) Instead, from the date of the deindexing, Google Analytics reported a
significant and dramatic drop in traffic to the BCS website. (Id.) The de-indexing
was investigated by Jesse Jensen and Noelle Beauregard—two BCS Board
Members. (Mot. 24–25.) During the investigation, Jensen became concerned
about the security of BCS’s systems and recommended to BCS’s leadership team
that they communicate any sensitive information through personal emails and
Signal, a messaging application. (Id. at 25.) Based on that investigation, Jensen
and Beauregard concluded that Defendants were responsible for the de-indexing.
(Compl. 12.) This lawsuit followed.
B. The Electronic Discovery Order
On September 6, 2022, the parties sought a Stipulated Order re: Amended EDiscovery Plan and Protocol for Discovery of Electronically Stored Information
///
4 In summarizing the alleged claims, the Court neither opines on the veracity or
merit of the allegations and claims, nor makes any findings of fact. Indeed, any
such opinions or findings would be unnecessary as the case was dismissed on May
8, 2024, before the Court had an opportunity to rule on the Motion.
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(ECF No. 40), which the Court granted on September 13, 2022 (“EDO”).5
(EDO,
ECF No. 41.) The EDO details the process to which the parties agreed for the
preservation, search, and production of electronically stored information (“ESI”).
(See generally EDO.) The sections of the EDO that are relevant to the Motion are
as follows:
Section 7.1, which, as a starting point, requires that the parties produce ESI
from the custodians specified in Section 4.3 and the data sources specified in
Section 4.4. (Id. ¶ 7.1.)
Section 4.3, which specifies the custodians from whom the parties agreed to
collect ESI, a list that includes specific names—Vanessa Hughes, Jennifer Magill,
McNamara, Jeremy Whiteley, Jesse Jensen, Noelle Beauregard, Lenore
Silverman, Eugene Furnace, Bobby Cook, Megan Hurwitt, Arianna Conroyd, and
5 Although BCS now claims that the Court entered the EDO over its objections
(Mot. 29, n.9), the facts show otherwise. Through its July 14, 2022 Scheduling
Order, the Court required the parties to submit a joint e-discovery plan addressing a
number of e-discovery terms identified by the Court. (ECF No. 31 at 3.) The Court
noted that if the parties could not agree on certain terms, they were to note this
disagreement in their joint filing and the Court would set an informal discovery
conference “to address any issues and to assist the parties in finalizing the Joint EDiscovery Plan” that would govern e-discovery in this case. (Id. at 4.) On August
12, 2022, the parties filed the required e-discovery plan noting disagreements
regarding: the applicable date range; the number of custodians Plaintiff would have
to search; the inclusion of back-ups, deleted/overwritten files, and RAM in the data
sources to be searched; the requirement of an agreed-upon set of search terms that
would be run by both parties alike; the requirement to collect, review, and produce
duplicates; and the requirement to preserve a forensic copy of each device or drive
with its costs to be borne by the party that owned the device. (ECF No. 35, ¶¶ 4.2,
4.3, 4.4, 5.1, 8.3, 10.1, 10.2.) In response, the Court held an informal discovery
conference during which some, but not all disputes, were resolved by the parties.
(ECF No. 39.) The Court ordered the parties to continue meeting and conferring to
resolve the remaining disputes and to file another e-discovery plan, again noting
areas of disagreement. (Id.) On September 6, 2022, the parties filed a second ediscovery plan, this time with no areas of disagreement. (ECF No. 40.) The Court
entered that plan as the EDO. (ECF No. 41.)
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Shelby Kirchoff—as well as two general categories of persons—“the entire BCS
Board of Directors” and “anyone else who had administrative permissions on the
website or any of BCS’s accounts or systems at the time the alleged hacking took
place”—(collectively, “Custodians”). (Id. ¶ 4.3.) According to information
obtained by Defendants from BCS through a different lawsuit, BCS’s Board of
Directors at the time of the EDO was comprised of Jennifer Magill, Vanessa
Hughes, Apryl Alexander, Lenore Silverman, Denette Boyd-King, Dorit Saberi,
and Dee Anna Hassanpour. (Mot. 14–15.)
Section 4.4, which specifies the data sources from which BCS agreed to
collect ESI provided the ESI was “in the possession, custody or control of any of
the Parties and reasonably accessible”. (EDO ¶ 4.4.) The term “Party” is defined
as “any party to this Action, including all its officers, directors, employees,
consultants, retained experts, and Outside Counsel (and their support staffs).” (Id.
¶ 2.13.) The data sources from which ESI was to be collected are listed as:
E-mail accounts, cell phones, Facebook accounts, Twitter
accounts, Skype accounts, and Slack accounts, Google
Drives, cell phones (including any backups of the cell
phones and all personal and BCS-controlled computing
devices of Vanessa Hughes, Jennifer Magill, Jesse Jensen,
Bobby Cook, McNamara, and Jeremy
Whiteley), text messages, Apple Messages, computers,
Zoom accounts, Hootsuite logs, Hootsuite audit data,
Hootsuite billing history, Instagram logs, Instagram audit
history, PayPal audit logs, Slack audit logs, server logs,
Cloudways databases, server and audit and access logs
(including all backups of the Cloudways web server 90
days before and after the alleged incidents), WordPress
databases, server and audit and access lots (including all
backups of the WordPress files 90 days before and after
the alleged incidents), WhatsApp chat logs, Telegram
chat logs, Google admin audit logs, system logs, TikTok
audit logs, Facebook messages, Facebook audit logs for
BCS page, YouTube audit logs, Signal chatlogs and any
other tech-based communications exchanged between
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custodians pertinent to this matter or the alleged hacking
incident.
(“Data Sources”). (Id. ¶ 4.4.)
Section 3, which details the parties’ preservation duties. Specifically, the
parties represented to each other that they had “taken reasonable steps to preserve
reasonably accessible sources of ESI with respect to the Custodians set forth in
paragraph 4.3 and the data sources set forth in paragraph 4.4.” (Id. ¶ 3.1.) The
parties further agreed “to disable any automatic deletion program with respect to
discovery sources of ESI” to the extent they already had not done so. (Id.¶ 3.2.)
Sections 4 and 6, which jointly subject the parties’ obligations under the
EDO to the tenets of the Federal Rules of Civil Procedure and relevant industry
standards. Specifically, Section 4.1 requires the parties “to identify, collect, and
produce responsive documents and ESI in accordance with the Federal Rules of
Civil Procedure,” and Section 6.1 requires the parties “to take into account the
proportionality considerations in [the] Federal Rules of Civil Procedure for
purposes of preservation and production of ESI and hard copy documents in this
Action,” noting that the EDO “is not intended to expand the Parties’ obligations
under Federal Rules of Civil Procedure 1, 26, and 34.” (Id. ¶¶ 4.1, 6.1 (emphases
added).) The EDO requires the producing party to “design and implement the
industry standard and approved methods it uses to identify, cull, and review its
potentially responsive ESI based on its knowledge and understanding of its own
data, the facts and issues involved in the Action . . . .” (Id. ¶ 4.5 (emphasis added).)
Finally, the EDO allows the producing party to use data analytics to identify and
review potentially responsive ESI and to conduct targeted collections of sources
“likely to contain responsive materials (e.g., file folders on a given hard drive).”
(Id.)
Section 8, which provides that a production of documents and ESI includes a
production of their metadata. (Id. ¶ 8.1.)
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C. The Discovery Dispute
During the early course of discovery, on a date unknown to the Court,
Defendants propounded document requests to BCS, which production was to be
governed by the EDO. (See EDO Section 1.) The specifics of Defendants’
documents requests are not relevant to the Motion because the crux of the discovery
dispute is not simply whether BCS improperly withheld responsive documents, but
rather whether BCS’s antecedent preservation of and searches for documents
complies with the terms of the EDO. (See generally Mot.) Specifically, the dispute
centers on whether the EDO requires BCS to preserve, search for, and produce
documents from both its organizational Data Sources, including those assigned to
the Custodians, (collectively, “BCS Data Sources”) and the personal Data Sources
of the Custodians (“Personal Data Sources”), as Defendants contend, or whether the
EDO requires BCS to preserve, search for, and produce documents only from the
BCS Data Sources, and then only if BCS, in its sole discretion, believed that a
search through those BCS Data Sources was likely to yield responsive documents,
as BCS contends. (See generally id.)6
6 Defendants also contend that, in addition to the EDO, BCS violated three Court
orders: (1) the order resulting from the April 18, 2023 informal discovery
conference, which required BCS to create a table of Custodians and Data Sources
and detail for each intersecting cell whether, and to what extent, that particular data
source had been searched, which Defendants contend BCS violated by failing to
include Custodians Apryl Alexander, Denette Boyd-King, Dorit Saberi, and De
Anna Hassanpour (Mot. 60); (2) the order resulting from the April 24, 2024
informal discovery conference, which required BCS to inform the Court whether
each of the Custodians had one or more of the Personal Data Sources, which
Defendants contend BCS violated by failing to provide information for Jennifer
Magill, Noelle Beauregad, Ariana Conroyd, Shelby Kirchoff, Apryl Alexander,
Lenore Silverman, Denette Boyd-King, Dorit Saberi, and Dee Anna Hassanpour
(id. at 61); and the order resulting from the May 1, 2023 informal discovery
conference, which required BCS to inform the Court about each Custodian’s
association with BCS and whether each Custodian would voluntarily provide
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During a series of informal discovery conferences (“IDC”) preceding the
filing of the Motion—IDC 37 on April 18, 2023, IDC 4 on April 24, 2023, IDC 5 on
May 1, 2023, and IDC 6 on May 3, 2023—BCS held steadfastly to its position that
its preservation of, and search through, some, but not all, of the BCS Data Sources
(including those assigned to the Custodians) satisfied its discovery obligations
under the EDO. (See generally Transcript (“Tr.”) IDC 3, ECF No. 83; Tr. IDC 4,
ECF No. 80; Tr. IDC 5, ECF No. 84; Tr. IDC 6, ECF No. 85.) Defendants
disagreed and instead contended that the EDO required a broader search that would
include the Personal Data Sources of the Custodians. (See id.) In that the parties
were unable to resolve the dispute informally, the Court issued an order permitting
Defendants to file a discovery motion under Rule 37. (IDC 6 Order, ECF No. 58
¶ 2.) This Motion followed. (See generally Mot.)
Through the Motion, Defendants ask the Court to issue evidentiary sanctions
for BCS’s failure to comply with the EDO in its document production, and to award
Defendants the reasonable expenses (including attorneys’ fees) they incurred as a
result of BCS’s failure to comply with the EDO. (See generally Mot.)8

documents responsive to Defendants’ discovery from their Personal Data Sources,
which Defendants contend BCS violated by failing to provide information for April
Alexander, Lenore Silverman, Denette Boyd-King, Dorit Saberi, or Dee Anna
Hassanpour (id.). While the Court agrees that BCS failed to comply with these
orders by providing incomplete information to each, the Court need not address
these violations separately as they are part and parcel of BCS’s ultimate violations
of the EDO, which violations are sufficient, standing alone, to warrant the sanctions
requested here.
7 The Court named the IDCs numerically. The first two IDCs—IDC 1 and IDC 2—
do not involve the disputes raised in the Motion.
8 Defendants also request an order compelling the production of documents in the
control of BCS’s current officers and directors. In light of the voluntary dismissal
of the case (ECF No. 210), the Court DENIES the request to compel discovery and
for evidentiary sanctions as moot. Nevertheless, the Court provides the
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Specifically, Defendants contend evidentiary and monetary sanctions are warranted
under Rule 37(b)(2)(C) because, despite the clear language of the EDO, BCS failed
to preserve, search for, collect, and produce documents from the BCS Data Sources
assigned to Lenore Silverman, Apryl Alexander, Denette Boyd-King, Dorit Saberi,
and Dee Anna Hassasnpour, and from all the Personal Data Sources of all the
Custodians, including critical screen shots—related to Jensen’s and Beauregard’s
investigation of the de-indexing blamed on Defendants—which BCS concedes were
held only in the Personal Data Sources of Jensen and Beauregard. (See generally
Mot.)
In opposition, BCS argues that neither evidentiary nor monetary sanctions
are warranted because (1) BCS did not violate the EDO in the first instance, and
(2) even if the Court were to find a violation, (a) BCS’s failure to comply with the
EDO was substantially justified, and (b) and award of sanctions would be unjust
under the attendant circumstances. (See generally Mot.)
D. Post-Motion Efforts to Resolve or Narrow the Dispute
The Court’s review of the Motion upon its filing revealed that, although it
was clear that BCS had violated the EDO as Defendants argued, the nature and
extent of Defendants’ resulting prejudice—information needed for resolution of the
evidentiary sanctions request—was neither clear nor self-evident. (See Tr. IDC 10,
ECF No. 124, at 12–15.) To address this evidentiary shortfall, and, in the process,
to give BCS one final opportunity to resolve the dispute short of the draconian
evidentiary sanctions and substantial monetary sanctions that could befall it—the
Court convened IDC 10 on August 9, 2023. (See id. at 14–19.) With this in mind,
the Court ordered “[a]ll attorneys in any way involved with the Motion and the
background information associated with those document requests to inform the
question of monetary sanctions.
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discovery that [was] the subject matter of the Motion,” as well as a decision-making
representative of BCS, “to appear in person.” (ECF No. 114.)
At IDC 10, the Court advised the parties of its tentative ruling that BCS had
violated the EDO and that the only remaining questions to resolve the Motion were
(1) the nature and extent of Defendants’ prejudice, which would inform the Court’s
decision regarding the requested evidentiary sanctions, and (2) the amount of
monetary sanctions that would be awarded to Defendants for BCS’s violation of the
EDO. (See Tr. IDC 10, at 12–15.) The Court also advised BCS that it would be
given one final opportunity to minimize, or eliminate altogether, the prejudice to
Defendants (and, relatedly, the evidentiary sanctions) by working with the
Custodians to identify the extent of documents thus far withheld and produce them
once and for all. (See id. at 14–19.) Any existing, responsive documents not
produced through this opportunity would become the basis for the Court’s prejudice
assessment and, ultimately, its evidentiary sanctions order. (See id.) The Court
advised that it would bifurcate the Motion into the evidentiary sanctions request,
which would be resolved first, and the monetary sanctions request, which would be
resolved second. (See id. at 15.) With that, the Court invited the parties to design a
process for resolution of the evidentiary sanctions request. (See id. at 18.)
At the suggestion of the Court, and working cooperatively at IDC 10, the
parties reached an agreement through which the evidentiary sanctions request
would be resolved in two phases, described as follows:
Phase 1 will involve joint efforts by the parties to obtain the
discovery at issue in the Motion from the officers and directors
of Plaintiff (“Discovery at Issue”), with or without the need for
subpoena discovery. Phase 1 will serve three purposes: (a) for
Defendants to obtain the Discovery at Issue, (b) to inform the
Court regarding the nature and extent of prejudice to
Defendants from the inability to obtain the entirety of
Discovery at Issue, and (c) to inform the Court whether any of
the Discovery at Issue has been spoliated. During this
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informal discovery conference, the parties reach an agreement
regarding the process for carrying out Phase 1. The reasonable
attorneys’ fees and costs incurred by Defendants in any
necessary subpoena discovery related to obtaining the
Discovery at Issue—whether incurred as part of Phase 1 or
heretofore—shall be borne by Plaintiff, upon order of this
Court on a motion by Defendants at the conclusion of Phase 1.
Phase 2 will involve the Court’s decision regarding the
requested evidentiary sanctions, which decision will be
informed by further briefing of the parties, as may be ordered
by the Court, regarding the outcome of Phase 1. To the extent
Defendants incur reasonable expenses (including attorneys’
fees) in supplementing the Motion to reflect the outcome of
Phase 1, the Court will consider a request for such fees upon a
process and schedule to be set by the Court at the appropriate
time.
(IDC 10 Order, ECF No. 120, at 1–2.)
To implement Phase 1, the parties entered into a stipulation that, upon the
parties’ request, the Court issued as the Interim Order on August 9, 2023 Informal
Discovery Conference re: Joint Stipulation for Evidentiary and Monetary Sanctions
Under FRCP 37(b) (“IDC 10 Agreement”). (IDC 10 Agm’t, ECF No. 132.) The
IDC 10 Agreement generally set forth the following two sub-phases—“Voluntary
Discovery” and “Subpoena Discovery.” During the “Voluntary Discovery,” first
BCS would work with each of the Custodians to obtain a declaration stating
whether they had any Personal Data Sources and, if so, whether the Personal Data
Sources contained BCS-related documents and whether they would make the
Personal Data Sources available to BCS for collection of such documents (id. ¶ 2);
next, BCS would collect any such documents, review them for responsiveness to
Defendants’ document requests, and produce them together with a privilege log
indicating the basis for any withheld documents (id. ¶ 3). During the “Subpoena
Discovery,” Defendants first would issue subpoenas to any Custodian who either
refused to participate in the Voluntary Discovery or who participated but who
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Defendants had a reasonable basis to believe was withholding documents, and
thereafter prosecute those subpoenas, including any necessary motions to compel
production under the subpoenas. (Id. ¶¶ 4–5.) The attorneys’ fees and costs
incurred by Defendants in connection with the prosecution of the subpoenas issued
to BCS’s officers and directors (issuance and enforcement motion practice),
whether incurred as part of Phase 1 or theretofore, would be borne by BCS upon
order of the Court pursuant to a motion by Defendants at the conclusion of Phase 1.
(Id. ¶ 7.)
At IDC 12, held on September 12, 2023 for another purpose, the Court
obtained an impromptu update regarding the progress of Phase 1. Upon the parties’
agreement, the Court extended the dates by which the Voluntary Discovery would
be completed. (IDC 12 Order, ECF No. 138, at 2.) In addition, Defendants advised
to the Court that one Custodian—Megan Hurwitt—already had advised she would
not participate in the Voluntary Discovery and requested leave to commence the
Subpoena Discovery as to her, which the Court granted. (Id. at 2.)
To monitor the progress of Phase 1, the Court convened IDC 13 on October
5, 2023. (ECF No. 141.) At IDC 13, Defendants informed the Court that they were
not satisfied with the responses to the Voluntary Discovery from certain
Custodians—Jesse Jensen, Arianna Conroyd, Vanessa Hughes, Eugene Furnace,
Shelby Kirchoff, and Lenore Silverman—and requested leave to commence the
Subpoena Discovery as to them, which the Court granted. (IDC 13 Order, ECF
No. 142.)
On February 15, 2024, Defendants filed a status report regarding the outcome
of Phase 1 (“Phase 1 Status Report”). (Status Rpt., ECF No. 168.) BCS filed a
response through which it disputes Defendants’ factual representations and
conclusions. (“Response to Status Report”). (Resp. to Status Rpt., ECF No. 192.)
At bottom, Phase 1 did not entirely achieve its goal of incentivizing the Custodians
to voluntarily turn over their responsive documents to BCS for production.
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Summarizing, some Custodians provided the requested declaration stating they
would allow BCS to search their Personal Data Sources for responsive documents,
for whom, according to Defendants, BCS produced some documents but not all;
some provided a declaration stating they did not have responsive documents; and
some refused to execute a declaration at all. (Status Rpt. ¶¶ 2–3.) BCS does not
dispute these facts. (Resp. to Status Rpt. 2.) As to the six Custodians for whom
Defendants were given leave to commence the Subpoena Discovery, Defendants
noted that three actively avoided service while the remaining three who were served
with subpoenas either ignored the subpoena altogether, executed a Certification of
No Records, or produced some documents. (Status Rpt. ¶ 4.) BCS does not dispute
these facts but advances two defensive arguments: (1) that some of the subpoenas
were issued to persons Defendants knew were unlikely to possess responsive
documents or were not material witnesses, and (2) that Defendants have offered no
evidence concerning evasion of service. (Resp. to Status Rpt. 2–3.)
In light of the issues raised in the Phase 1 Status Report and their
implications on the Motion, the Court convened a Status Conference on March 25,
2024 which was extended to April 5, 2024 (together, the “March/April Status
Conferences”). (ECF Nos. 180–81, 193, 196.) There, the Court concluded that the
Motion required supplementation regarding the outcome of Phase 1 and set a
briefing schedule. (ECF No. 196.)
Before Defendants could file their opening supplemental brief, BCS filed a
Request for Voluntary Dismissal with Prejudice Pursuant to FRCP 41(a)(2)
(“Dismissal Request”). (Dismissal Req., ECF No. 198.) After full briefing, the
Court granted BCS’s Dismissal Request, noting that the dismissal mooted the
evidentiary sanctions portion of the Motion, but neither mooted nor stripped the
Court of jurisdiction to decide the monetary sanctions portion of the Motion
(“Dismissal Order”). (Dismissal Order, ECF No. 210.) On this basis, the Court
denied the evidentiary sanctions portion of the Motion as moot and ordered
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supplemental briefing to update the monetary sanctions portion of the Motion to
include a comprehensive request for attorneys’ fees, including for the work
performed after the filing of the Motion. (Id. at 4–5.) The Motion Supplement
followed. (See Mot. Suppl.)
III. DISCUSSION
Through the Motion and the Motion Supplement, Defendants request
monetary sanctions against BCS and its counsel pursuant to Rule 37(b)(2)(C) “to
cover the costs of the IDCs that Defendants’ counsel was forced to attend and the
costs associated with the instant Motion.” (Mot. 64; see Mot. Suppl. 7–10.) BCS
opposes this request, noting that it did not violate any Court order, and asks that, if
the Court is inclined to impose monetary sanctions, it reduce the fees requested as
unreasonable and/or unrecoverable. (Mot. Suppl. 11–12.)
A. Legal Standard
Pursuant to Rule 37(b), a party may seek monetary and nonmonetary
sanctions for another party’s failure to comply with a discovery order. Fed. R. Civ.
P. 37(b)(2). Rule 37(b)(2)(C) requires that a district court, instead of or in addition
to nonmonetary sanctions allowed in Rule 37(b)(2)(A), “order the disobedient
party, the attorney advising that party, or both to pay the reasonable expenses,
including attorney’s fees, caused by the [discovery] failure, unless the failure was
substantially justified or other circumstances make an award of expenses unjust.”
Fed. R. Civ. P. 37(b)(2)(C). Thus, for fees to be awarded pursuant to Rule
37(b)(2)(C), there must be a “causal connection” between a litigant’s discovery
misconduct and the legal fees incurred by the opposing party. Goodyear Tire &
Rubber Co. v. Haeger, 581 U.S. 101, 108 n.5 (2017). “That kind of causal
connection . . . is appropriately framed as a but-for test: the complaining party . . .
may recover ‘only the portion of his fees that he would not have paid but for’ the
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misconduct.” Id. at 109 (quoting Fox v. Vice, 563 U.S. 826, 836 (2011)). As
explained by the Supreme Court in Haeger:
This but-for causation standard generally demands that a
district court assess and allocate specific litigation expenses—
yet still allows it to exercise discretion and judgment. The
court’s fundamental job is to determine whether a given legal
fee . . . would or would not have been incurred in the absence
of the sanctioned conduct. The award is then the sum total of
the fees that, except for the misbehavior, would not have
accrued.”
Id. at 109–10.
Trial courts, however, “need not, and indeed should not, become greeneyeshade accountants.” Id. at 110. “‘The essential goal’ in shifting fees is ‘to do
rough justice, not to achieve auditing perfection.’ Accordingly, a district court
‘may take into account [its] overall sense of a suit, and may use estimates in
calculating and allocating an attorney’s time.’” Id. (alteration in original) (internal
citations omitted) (quoting Fox, 563 U.S. at 838). The disobedient party shoulders
the burden of avoiding such sanctions by establishing substantial justification for
the discovery misconduct or that special circumstances make the award of expenses
unjust. See 1970 Advisory Comm. Notes to Rule 37(b).
B. Analysis
1. BCS violated the EDO.
Defendants argue that BCS’s failure to preserve, search for, and produce
documents from all the BCS Data Sources and from the Personal Data Sources
violates the EDO. (See Mot. 14–16, 22–27.) They contend that the EDO’s
language is unambiguous in this requirement:[F]ist [sic], Section 7.1 of the stipulated EDO provides
that “The Parties will produce, on a rolling basis, ESI
from the data sources and Custodians identified in
paragraph 4.3 and 4.4” . . . Second, paragraph 4.4 states
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that “The Parties agree that the data sources include the
following, so long as they are in the possession, custody,
or control of any of the Parties and reasonably
accessible” . . . Finally, the stipulated EDO defines the
term “Party” as “any party to this Action, including all of
its officers, directors employees, consultants, retained
experts, and Outside Counsel (and their support
staffs).[”] (Mot. 26 (citing EDO) (internal citations omitted).)
BCS contends that it did not violate the EDO for a litany of reasons. (Mot.
16–22, 27–40; Mot. Suppl. 18.) The Court addresses each in turn and concludes
that, consistent with its tentative ruling as stated at IDC 10, BCS violated the EDO.
a. BCS violated the EDO by not searching for and collecting
documents from all the BCS Data Sources.
Defendants contend that BCS violated the EDO by not searching through and
collecting documents from the BCS Data Sources assigned to Lenore Silverman,
Apryl Alexander, Denette Boyd-King, Dorit Saberi, and Dee Anna Hassanpour.
(Mot. 15.) As detailed below, the Court agrees in part.
Lenore Silverman: Although Silverman is identified by name as a Custodian
(EDO ¶ 4.3), BCS never produced documents from the BCS Data Sources related
to any accounts assigned to her. BCS explains that, despite having formerly been a
member of BCS’s Board of Directors, Silverman never was assigned a BCS Data
Source. (Mot. 22.) Defendants offer no evidence to the contrary. With this, the
Court is satisfied that BCS did not have an obligation under the EDO to collect
documents from the BCS Data Sources for Silverman. According, its failure to do
so does not constitute a violation of the EDO.
Apryl Alexander, Denette Boyd-King, Dorit Saberi, and Dee Anna
Hassanpour: The EDO does not identify Alexander, Boyd-King, Saberi, and
Hassanpour by name as Custodians. (EDO ¶ 4.3.) However, Defendants argue that
they qualify as Custodians through the EDO’s general category of “the entire BCS
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Board of Directors.” (Id.) They point to BCS’s under-oath discovery responses in
a related state court matter wherein BCS identified the four as members of its Board
of Directors during the relevant period. (Mot. 14–15; Def. Ex. 1, at 5–6 (Special
Interrogatory No. 19: “IDENTIFY all members of YOUR Board of Directors from
March 2021 to the present”; BCS’s Supplemental Response listing “Dr. Apryl
Alexander; . . . Dr. Denette Boyd-King; Dr. Dorit Saberi;[] and Dee Anna
Hassanpour”).) Despite this, BCS consistently has maintained in this litigation that
Boyd-King, Saberi, and Hassanpour never were members of its Board of Directors.
(Mot. 17.) However, nothing in this litigation has explained this discrepancy.
Nevertheless, in support of its position, BCS has submitted under-oath declarations
of Boyd-King, Saberi, and Hassanpour affirming that they never were Board
members and explaining that, although they were considered for Board positions,
they never assumed them. (See generally King Decl., Hassanpour Decl., Saberi
Decl..) With this, the Court is satisfied that BCS did not have an obligation under
the EDO to collect documents from the BCS Data Sources for Boyd-King, Saberi,
and Hassanpour. Accordingly, its failure to do so does not constitute a violation of
the EDO.9
The same result cannot be reached regarding the BCS Data Sources assigned
to Alexander. BCS concedes that Alexander was a Board member and that it issued
her “a Google email and Drive account,” both BCS Data Sources. (Mot. 21.)
However, BCS argues that it was not obligated to collect documents from those
9 Defendants insist that this discrepancy is more than a mere mistake in the state
court case and instead constitutes an affirmative misrepresentation to this Court for
which sanctions are warranted. (Mot. 15.) The Court is not convinced. While late
in the game, BCS clarified at IDC 6 that the list of Board members from which
Defendants were working appeared to be “a list of people who were once
considered . . . as potential Board members of the organization . . . but all three of
them refused, for various reasons.” (Tr. IDC 6, at 30.) Thus, despite BCS’s
missteps and delay on this issue, the Court declines to accept Defendants’
characterization of BCS’s discovery conduct as sanctionable malfeasance.
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BCS Data Sources because Alexander “was not a member of Plaintiff’s Board of
Directors until June 2022, months after the allegations in the Complaint.” (Id.)
BCS explains that it made the decision to not collect those documents because
“Alexander would not have been a custodian pursuant to section 4.3 during the
relevant time period and because Alexander’s account was not reasonably likely to
yield responsive ESI.” (Id.) But this defies the clear language of the EDO, coauthored by BCS, which captures Alexander within the definition of Custodians as
part of “the entire BCS Board of Directors” for the period February 1, 2020 through
September 13, 2022, the date of the EDO. (EDO ¶¶ 4.2, 4.3.) And there is no
exception in the EDO that would allow BCS to exclude from collection any Data
Source it, in its sole discretion, believed was not reasonably likely to yield
responsive ESI. (See generally EDO; see also Section III.B.2 infra.) To the extent
BCS relies on the language in Paragraph 4.5 for this proposition—“A Producing
Party may conduct a targeted collection of sources likely to contain responsive
materials (e.g., file folders on a given hard drive)—the Court disagrees. The Court
reads this sentence as an additional method of searching through the Data Sources,
not as an unbridled license to unilaterally limit searches. On this basis, the Court
concludes that BCS violated the EDO by not searching through and collecting
documents from the BCS Data Sources assigned to Alexander.
b. BCS violated the EDO by not searching for and collecting
documents from all the Personal Data Sources of all the
Custodians.
It cannot be disputed that BCS failed to search for and produce documents
from all the Personal Data Sources of all the Custodians and that even the Phase 1
efforts did not save BCS from this failure. Indeed, BCS conceded as early as in
IDC 3 that it did not search for and produce documents from the Personal Data
Sources of the Custodians. (See generally Tr. IDC 3; Def. Ex. 5 (indicating that
BCS only searched the BCS Data Sources).) Defendants’ Phase 1 Status Report
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reveals that the final opportunity given to BCS to work with the Custodians to shore
up its production shortfall was successful only as to Alexander, Bobby Cook,
Noelle Beauregard, Boyd-King, Saberi, and Hassanpour. (See Status Rpt. 3–5.) As
a starting point, Defendants report that the Voluntary Discovery did not have the
desired results. Specifically, although Arianna Conroyd and Jesse Jensen declared
they would search for documents, BCS never produced any such documents;
although Jennifer Magill and Vanessa Hughes produced some documents,
Defendants contend these productions are incomplete; and Eugene Furnace, Shelby
Kirchoff, Hurwitt, and Silverman refused to participate in the Phase 1 process
altogether. (See id.) BCS does not dispute these facts.10 (See Resp. to Status Rpt.
2.) Defendants further report that the Subpoena Discovery also was not completely
productive. Specifically, of the six Custodians whose documents were subpoenaed
under Phase 1: only two responded satisfactorily—Hurwitt by executing a
Certification of No Records, and Silverman by producing some documents; one—
Kirchoff—ignored the subpoena altogether; and three were not served—Furnace
because the process server could not gain access to his gated community, and
Jensen and Hughes because, according to Defendants, they actively evaded service.
(Status Rpt. 5–6.) BCS does not dispute these facts but instead offers two
arguments as to why they should be disregarded: (1) that Defendants should not
have issued the subpoenas to Silverman, Kirchoff, and Furnace to begin with
because Defendants knew “that each of them was highly unlikely to possess
10 BCS characterizes Defendants’ contention that the productions of Jensen,
Conroyd, Magill, and Hughes were unsatisfactory as “specious” and “frivolous”
efforts “to drum up additional examples of alleged order violations,” including of a
Phase 1 violation, noting that Defendants’ purported concerns were resolved by the
Subpoena Discovery as to these Custodians. (Mot. Suppl. 18.) But as noted in
footnote 6 above, the Court need not consider violations of orders beyond the EDO
for purposes of this Motion. In any event, as detailed here, the Subpoena Discovery
did not resolve the dispute regarding the documents of these Custodians.
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responsive documents [as] Silverman is a former BCS Board member who was not
involved in the March 2022 events giving rise to this lawsuit . . . [and] Defendants
do not even attempt to explain how Kirchoff or Furnace [are] material witness[es],
particularly since Furnace was only briefly a BCS member for a few months,” and
(2) that Defendants offer no evidence of Jensen’s and Hughes’s purported evasion
of service. (Resp. to Stat Rpt. 2–3.) But, BCS’s arguments, even if fully credited,
do not mitigate the fact that BCS did not itself search for and produce these
documents outside of the Phase 1 process, which was created for the very purpose
of rescuing BCS from its failings. Moreover, BCS’s unilateral and unsupported
belief that Silverman, Kirchoff, and Furnace were unlikely to have responsive
documents does not preclude Defendants from testing that theory. See Fed. R. Civ.
P. 26(d) (providing that each party may conduct whatever discovery a party chooses
and in any sequence the party desires). In sum, although BCS was given multiple
opportunities to produce responsive documents, the evidence is clear that it fell
short with respect to the documents from the Personal Data Sources of Custodians
Conroyd, Jensen, Magill, Hughes, Furnace, and Kirchoff.
Despite this overwhelming evidence, BCS contends that it did not violate the
EDO because, under its interpretation of the EDO and the applicable discovery
rules, it was not obligated to produce documents from the Personal Data Sources of
the Custodians in the first instance. (See generally Mot.) BCS advances many
arguments in support of this position, all of which the Court finds unavailing.
First, BCS argues that the disparity between the obligations of the parties
under the EDO—requiring BCS to collect and produce the ESI of at least fifteen
Custodians while Defendant was required to collect and produce the ESI of only
two Custodians—militates against Defendants’ broad interpretation of the EDO.
(Mot. 28–29; n.9.) However, BCS provides no legal support for this proposition.
(See generally Mot., Mot. Suppl.) Moreover, BCS not only entered into this EDO
with full knowledge of its obligations—or at least there is no evidence to the
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contrary—but, as detailed above, it actually participated in the crafting of the EDO
and agreed to its terms. (See Section II.B., n. 5, supra.) BCS cannot now be heard
to complain about its terms, even if they are disparate. Moreover, it is logical and
expected that BCS would have to collect from more Custodians than Defendants—
BCS is an organization that has a number of officers and directors who, with the
exception of a few, were directly involved in the claims BCS raises in the
Complaint while Defendants are merely two individuals. (See generally Compl.)
This argument does not persuade the Court that BCS did not violate the EDO.
Second, BCS argues that the EDO is subject to the Federal Rules of Civil
Procedure, which limit BCS’s obligations. (Mot. 12, 29.) Specifically, BCS points
to the provisions of the EDO proclaiming that the EDO “is not intended to expand
the Parties’ obligations under Federal Rules of Civil Procedure 1, 26, and 34,” and
that “[t]he Parties agree to take into account the proportionality considerations
addressed in Federal Rules of Civil Procedure for purposes of preservation and
production of ESI . . . .” (Id. at 29 (citing EDO ¶ 6.1.) BCS urges that, based on
these provisions, the EDO is limited to discovery that is proportional to the needs of
the case. (Id. at 29–30 (citing Fed. R. Civ. P. 26(b).) But a proportionality
argument is of no avail to BCS because, despite the Court’s many attempts to
obtain clarity regarding the nature and extent of the missing ESI (see generally Tr.
IDC 3; see generally Tr. IDC 4; see generally Tr. IDC 5; see generally Tr. IDC 6),
BCS has yet to provide an answer and, in fact, fails to provide non-conclusory facts
to support a proportionality argument here. (See generally Mot.; see generally Pl.
Suppl. Memo.; see generally Resp. to Status Rpt.) This argument does not
persuade the Court that BCS did not violate the EDO.
Third, BCS argues that the EDO is subject to “industry standard practices”
which also limit BCS’s obligations. (Mot. 12, 29.) Specifically, BCS points to
provisions of the EDO proclaiming that “[e]ach producing party shall design and
implement the industry standard and approved methods it uses to identify, cull, and
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review its potentially responsive ESI based on its knowledge and understanding of
its own data, the facts and issues involved in the Action,” and that “[a] producing
party may also conduct a targeted collection of sources likely to contain responsive
materials (e.g., file folders on a given hard drive.” (Id. at 29 (citing EDO ¶ 4.5).)
But BCS’s “industry standard” argument is equally unavailing given that BCS fails
to either (1) explain how its ability to design and implement its search somehow
militates against the definitions of the EDO that form the contour of the data
sources to be searched, or (2) otherwise cite a specific industry standard that would
limit the EDO in any other way. (See generally Mot.; see generally Pl. Suppl.
Memo.; see generally Resp. to Status Rpt.) Moreover, as stated above, the Court is
not persuaded that the EDO’s sentence allowing a targeted collection of sources
limits the discovery as BCS suggests. This argument does not persuade the Court
that BCS did not violate the EDO.
Fourth, BCS argues that the proportionality rules do not require a party to
search in places where responsive information is unlikely to exist. (Mot. 30.) But
the legal authorities BCS offers in support of this proposition are inapposite.
Neither Patagonia, Inc. v. Anheuser-Busch, LLC, No. CV 19-02702 VAP (JEMx),
2020 WL 12175722 (C.D. Cal. Feb. 26, 2020), nor Thompson v. Costco Wholesale
Corp., No. 3:14-CV-2778-CAB-WVG, 2015 U.S. Dist. LEXIS 201270 (S.D. Cal.
Sep. 21, 2015), involve a discovery dispute where the parties entered into an
electronic discovery order that specified the custodians and data sources to be
searched, as is the case here. Nor do the facts that BCS avers—that the Custodians’
Personal PayPal and Venmo accounts “have absolutely nothing to do with the
allegations in this case because there is no allegation that any personal account was
hacked”—support this proposition. (Mot. 30–31.) Indeed, while the Court does not
decide the relevance of these data sources, BCS’s assertion begs the question: then
why did BCS agree to include these data sources in Section 4.4 to begin with?
Having agreed to include these accounts in the definition of Data Sources, BCS
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created its own obligation to preserve and search them. This argument does not
persuade the Court that BCS did not violate the EDO.
Fifth, BCS argues that the definition of “Party”—which includes a party’s
officers and directors—should be disregarded because it renders meaningless the
agreed-upon list of Custodians and the explicit limitation that a Data Source must
be in the party’s possession, custody, or control. (Mot. 31.) To the contrary, the
Court interprets the definition of Party as a helpful, shorthand means to include
categories of persons whose identities were unknown or uncertain to Defendants at
the time of the EDO’s writing, relevant here BCS’s officers and directors. Had
BCS been willing to share these names at that time—as only BCS could have—it
easily could have included them in the list of Custodians and eliminated the need
for the general categorical descriptions of “Party.” It did not do so. It now must
live with its language. This argument does not persuade the Court that BCS did not
violate the EDO.
Sixth, BCS argues that the EDO’s definition of “Party” also defies legal
authority holding that the personal accounts of a principal’s agent or representative
are not considered to be within the possession, custody, or control of the principal.
(Mot. 33–35.) But BCS fails to properly frame the issue. The proper inquiry for
this Motion is whether a principal—here BCS—is deemed to have control over the
Personal Data Sources of its agents or representatives—here BCS’s officers and
directors—where the latter use their Personal Data Sources to conduct the business
of the former—here, the use of personal Signal and email accounts to communicate
about BCS’s sensitive matters at the express direction of Jensen (one of BCS’s two
investigators of the complained-of de-indexing) to “the entire leadership team of
BCS” because, in the aftermath of the de-indexing, he feared BCS was under cyberattack. (Def. Ex. 4 at 3–4, 6–7.)
As aptly noted by Defendants and supported by their authorities, the answer
to this inquiry is a resounding “yes.” (Mot. 51–52.) See, e.g., Waymo LLC v. Uber
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Techs, Inc., No. 17-cv-00939-WHA (JSC), 2017 U.S. Dist. LEXIS 108165, at *7
(N.D. Cal. July 12, 2017) (ordering corporation to “produce responsive documents
in the custody, control or possession of its officers” and explaining that “[i]t cannot
hide responsive documents simply because these officers’ work for [the
corporation] was done using their personal email accounts”); Tradeshift, Inc. v.
BuyerQuest, Inc., No. 20-cv-01294-RS (TSH), 2021 U.S. Dist. LEXIS 78658, at
*7–8 (N.D. Cal. Apr. 23, 2021) (ordering corporation to produce emails sent from
an officer’s personal email to conduct business because to hold otherwise would
“gut Rule 34 and make it way too easy for high-level executives to hide evidence”);
Matter of Skanska USA Civ. Se. Inc., No. 3:20-CV-05980-LC/HTC, 2021 U.S. Dist.
LEXIS 208691, at *36 (N.D. Fla. Aug. 5, 2021) (finding that corporation had an
obligation to produce information on an officer’s personal cell phone because it
“cannot shuck its discovery obligations simply because it did not issue the cell
phone to” the officer); Miniace v. Pacific Maritime Ass’n, No. C 04-03506 SI, 2006
U.S. Dist. LEXIS 17127, *7 (N.D. Cal. Feb. 13, 2006) (“[n]umerous courts have
found that corporations have control over their officers and employees and that
corporations may be required to produce documents in their possession.”); Allen v.
Woodford, No. CV-F-05-1104 OWW LJO, 2007 WL 309945, at *2 (E.D. Cal. Jan.
30, 2007) ( “‘Control’ may be established by the existence of a principal-agent
relationship”); JPMorgan Chase Bank, N.A. v. KB Home, No. 2:08-CV-1711-PMPRJJ, 2010 U.S. Dist. LEXIS 56519, at *18 (D. Nev. May 18, 2010) (“agency
relationship is sufficient to find control for purposes of Rule 34”).
BCS’s authorities to the contrary are distinguishable and do not compel a
different result. (Mot. 33–34.) In re Citric Acid Lit., 191 F.3d 1090, 1107–108 (9th
Cir. 1999), is inapposite because the question before the court was whether a U.S.
company had control over the documents of its Swiss affiliate, not its officer and
directors, and did not involve an electronic discovery order pre-establishing its
discovery obligations. Matthew Enterp., Inc. v. Chrysler Group LLC, No. 13-cvCase 2:22-cv-02052-MAA Document 221 Filed 09/06/24 Page 25 of 49 Page ID
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04236-BLF, 2015 U.S. Dist. LEXIS 166553 (N.D. Cal. Dec. 10, 2015), also is
unavailing because the question before the court was whether a corporation had
control over the personal email account of a person who did minimal work for the
company but was neither an officer nor a director, and did not involve an electronic
discovery order. U.S. v. Int’l Un. of Petroleum Indus. Workers, 870 F.2d 1450,
1452 (9th Cir. 1989), is equally distinguishable because it involved the question
whether a non-principal international union had control over a non-agent local
union’s documents, and did not involve an electronic discovery order. Thermal
Design, Inc. v. Am. Soc. of Heating, Refrigerating and Air-Condition Eng., Inc.,
755 F.3d 832 (7th Cir. 2014), also falls short because the question before the court
was whether an organization had control over the documents of its non-leadership
volunteer committee members, and did not involve an electronic discovery order.
Int’l Longshore & Warehouse Union v. ICTSI Oregon, Inc., No. 3:12-cv-1058-SI,
2018 U.S. Dist. LEXIS 204118, at *11 (D. Or. Dec. 3, 2018), is inapplicable
because the question before the court was whether the union had control over the
email accounts of its officers, agents, or members that were not used for more than
a de minimus amount, and, further to Defendants’ argument, resulted in a finding
that “a company’s officer or agent should not be able to avoid the rules of discovery
by using personal email . . . for work purposes.”
This argument does not persuade the Court that BCS did not violate the
EDO.
Seventh, BCS argues that the definition of “Party”—which also includes a
party’s counsel—should be disregarded because it leads to absurd results, such as
requiring, for example, a search of Defendants’ counsel’s documents. (Mot. 31.)
The Court does not disagree. But BCS’s proposed solution—to disregard the
definition altogether—is unworkable given that the parties saw fit to use the terms
“Party” and “Parties” in the EDO in excess of sixty times. (See generally EDO.)
BCS can rest assured that this Court is fully capable of identifying and avoiding
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absurd results. Other than this limited circumstance, which, notably, BCS helped
create and is not at issue here, the Court is aware of no other absurd result. This
argument does not persuade the Court that BCS did not violate the EDO.
Eighth, BCS argues that, contrary to Defendants’ assertions that BCS did not
produce “anything from the custodians other than emails on Plaintiff’s server and
documents form Plaintiff’s Google drive,” it did produce Hughes’s text messages,
Magill’s personal cellphones and emails, Jensen’s emails, and Hughes’s Signal
messages. (Mot. 66; Pl. Suppl. Memo. 2.) BCS also notes that it collected ESI
from the BCS Data Sources for, and the Personal Data Sources of, fourteen
Custodians “if (1) [BCS] had a reasonable belief that they may contain responsive
ESI, and (2) the custodian agreed to grant access thereto . . . .” (Id. at 67 (emphasis
added).) BCS further notes that it produced the screenshots taken during the
investigation by Jensen and Beauregard that it found attached to emails. (Id. at 66–
67.) But these assertions miss the point entirely. BCS was required to (1) collect
and produce much more than what it produced from Hughes, Magill, and Jensen—
both in the way of Data Sources and Custodians; (2) search through the all the Data
Sources (BCS and Personal) related to all the Custodians, not just of those
Custodians who BCS, in its sole discretion, believed would have documents or of
those Custodians who voluntarily agreed to a search; and (3) produce original
documents, not merely screenshots attached to emails without metadata. BCS’s
partial production does not satisfy its obligation to make a complete production.
See Fed. R. Civ. P. 34(b)(2)(B) (requiring complete document productions). This
argument does not persuade the Court that BCS did not violate the EDO.
* * *
In sum, the Court concludes that that the EDO required BCS to preserve,
search for, and produce the ESI from all the BCS Data Sources assigned to the
Custodians, and from all the Personal Data Sources of all the Custodians, and that
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its failure to do so constitutes a violation of the EDO, sanctionable under Rule
37(b)(2).
2. BCS’s failure to comply with the EDO was not substantially
justified and no circumstances exist here that would make an
award of expenses unjust.
BCS seeks refuge from the imposition of sanctions under the two exceptions
to Rule 37(b)(2)(C), which allow the Court to decline an award of sanctions where
“the [discovery] failure was substantially justified or other circumstances make an
award of expenses unjust.” (Mot. Suppl. 5, 19–20 (citing Fed. R. Civ. P.
37(b)(2)(a), (c)).) For the reasons set forth below, BCS is not entitled to this
protection.
The first exception—that the failure to comply with a court order is
substantially justified—does not save BCS. Both the Ninth Circuit and the
Supreme Court have offered guidance regarding the standard for establishing
“substantial justification” sufficient to avoid a discovery sanction. In Hyde &
Drath v. Baker, 24 F.3d 1162, 1171 (9th Cir. 1994), the Ninth Circuit stated that “a
good faith dispute concerning a discovery question might, in the proper case,
constitute ‘substantial justification . . . .’” (citation omitted). The Supreme Court
has explained that the standard is “satisfied if there is a ‘genuine dispute’. . . or ‘if
reasonable people could differ as to the appropriateness of the contested action.’”
Pierce v. Underwood, 487 U.S. 552, 565 (1998) (citations and alterations omitted).
Here, BCS contends that the Court should decline to impose sanctions
because its interpretation of the EDO was reasonable, legally-supported, and made
in good faith. (Mot. 74, Mot. Suppl. 5, 19–20.) For the multiple reasons set forth
above—which need not be repeated here—the Court disagrees with BCS’s
contention that its interpretation was reasonable and legally-supported. In addition,
the presence or absence of a disobeying party’s good or bad faith “is relevant to the
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imposed.” Marquis v. Chrysler Corp., 577 F.2d 624, 642 (9th Cir. 1978); see also
Societe Internationale Pour Participations Industrielles et Commerciales, S.A. v.
Rogers, 357 U.S. 197, 208 (1958) (finding that, because Rule 37 requires only a
failure to obey an order and not a refusal, the question of willfulness is “relevant
only to the path which the district Court might follow in dealing with” the failure to
comply). “[E]ven negligent failures to allow reasonable discovery may be
punished.” Marquis, 577 F.2d at 642.
The second exception—that the attendant circumstances would make an
award of sanctions unjust—also does not save BCS. BCS first argues that the
imposition of sanctions would be unjust because it “undert[ook] significant efforts
to collect and provide extensive discovery pursuant to the [EDO],” and that the
Court’s subsequent disagreement with BCS’s position should not be grounds for a
pecuniary penalty. (Mot. Suppl. 19–20.) But the transcripts of IDCs 3 through 6
and 10, together with their related documents, the Court’s orders, and the outcome
of Phase 1, combine to tell a different story. These documents reveal in painstaking
detail the early struggles of Defendants and the Court to disavow BCS of its
untenable legal position that it was not obligated to produce the vast majority of
documents required under the EDO—to which it held steadfastly since at least IDC
3 in April 2023—and to convince BCS to even start the required search process.
The documents also reveal the multiple opportunities given to BCS to convince its
officer and directors to cooperate so that it, as the organization, could comply with
its discovery obligations and the repeated—albeit apparently ignored—
admonishments by the Court to the BCS leadership that its discovery failures could
have costly effects on the organization’s treasury and devastating effects on this
litigation. (See generally Tr. IDC 3; Tr. IDC 4; Tr. IDC 5; Tr. IDC 6; Tr. IDC 10,
at 8, 11, 16 (warning BCS that “the financial impact on BCS [could] be very severe,
and the evidentiary impact . . . even more so,” that it was “almost 100 percent
certain that there [would] be evidentiary sanctions and monetary sanctions,” and
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that the lack of cooperation by BCS’s officers and directors “[would] cost BCS a lot
of money” and that it “[would] be very expensive . . . quite a bit of money.”).)
Finally, the documents reveal that, despite these opportunities and warnings, some
of the Custodians—the very guardians of the organization’s donated funds, charged
with making decisions in the best interests of the organization’s mission—dug in
their heels and affirmatively created the circumstances that now warrant sanctions.
The Court cannot conclude on these facts that the imposition of sanctions would be
unjust.
BCS next argues that any non-de minimis award of sanctions would be unjust
because it could be “ruinous” for the organization while providing no gain to
Defendants who, in any event, were not prejudiced. (Mot. Suppl. 20.) But, other
than its conclusory assertions, BCS offers no evidence of its purported dire
financial straits. (See generally Mot. Suppl.) Moreover, whether an award of
sanctions would benefit the recipient is not the correct question; rather, the proper
question is whether the imposition of sanctions would be unjust to the sanctioned
party. See Fed. R. Civ. P. 37(b)(2)(C). In any event, BCS is mistaken that
“Defendants will gain nothing from the imposition of fees.” (Mot. Suppl. 6, 20.)
To the contrary, an award of fees will allow Defendants to recover, at least in part,
the enormous quantum of fees and costs they were forced to incur as a result of the
obstinate discovery position BCS and its officers and directors took and held for
well over one year. Indeed, but for BCS’s failure to comply with the EDO,
Defendants would have obtained the requested documents in early 2023 and would
not have been forced to expend the resources that have brought the parties to this
point. Further, even liberally construing BCS’s contention that its conduct did not
prejudice Defendants (Mot. 71–72) as an argument under the second exception, it is
unpersuasive. As a starting point, BCS cites no authority to support its position that
lack of prejudice somehow renders unjust an award of expenses under Rule
37(b)(2)(C). (See generally Mot.; see generally Mot. Suppl.) Moreover, the
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authorities known to the Court are to the contrary, holding that “[f]ailure to produce
documents as ordered . . . is considered . . . prejudice.” Adriana Int’l Corp. v.
Thoeren, 913 F.2d 1406, 1412 (9th Cir. 1990) (internal citation omitted) (emphasis
added).
For these reasons, the Court finds that neither of the Rule 37(b)(2)(C)
exceptions save BCS from the imposition of sanctions.

C. Defendants Are Entitled to an Award of $34,986.50.
1. Legal Standard
When an award of attorneys’ fees is authorized, the court must calculate the
proper amount of the award to ensure that it is reasonable. Hensley v. Eckerhart,
461 U.S. 424, 433–34 (1983). In the Ninth Circuit, the court must perform a twostep process to determine the reasonableness of any fee award. Fischer v. SJBP.D., Inc., 214 F.3d 1115, 1119 (9th Cir. 2000). First, the Court determines the
“lodestar figure.” See Gates v. Deukmejian, 987 F.2d 1392, 1397 (9th Cir. 1992).
“The ‘lodestar’ is calculated by multiplying the number of hours the prevailing
party reasonably expended on the litigation by a reasonable hourly rate.” Camacho
v. Bridgeport Fin., Inc., 523 F.3d 973, 978 (9th Cir. 2008) (citation omitted).
Second, where appropriate, the Court may adjust the lodestar amount based on
several factors adopted by the Ninth Circuit in Kerr v. Screen Extras Guild, Inc.,
526 F.2d 67, 70 (9th Cir. 1975), known as the Kerr factors:
(1) the time and labor required, (2) the novelty and
difficulty of the questions involved, (3) the skill requisite
to perform the legal service properly, (4) the preclusion
of other employment by the attorney due to acceptance of
the case, (5) the customary fee, (6) whether the fee is
fixed or contingent, (7) time limitations imposed by the
client or the circumstances, (8) the amount involved and
the results obtained, (9) the experience, reputation, and
ability of the attorneys, (10) the ‘undesirability’ of the
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case, (11) the nature and length of the professional
relationship with the client, and (12) awards in similar
cases.
Kerr, 526 F.2d at 70.
A strong presumption exists “that the lodestar figure represents a reasonable
fee.” Morales v. City of San Rafael, 96 F.3d 359, 363 n.8 (9th Cir. 1996). The
Ninth Circuit has made clear that “[o]nly in rare instances should the lodestar figure
be adjusted on the basis of other considerations.” Id. (citations omitted). “Under
the lodestar approach, many of the Kerr factors have been subsumed as a matter of
law.” Id. (citation omitted). The Kerr factors that are subsumed within the initial
lodestar calculation are the novelty and complexity of the issues, the special skill
and experience of counsel, the quality of representation, the results obtained in the
action, and the contingent nature of the fee agreement. Id. at 364 n.9 (citations
omitted). “Adjusting the lodestar on the basis of subsumed reasonableness factors
after the lodestar has been calculated, instead of adjusting the reasonable hours or
reasonable hourly rate at the first step . . . is a disfavored procedure.” Id. (citation
omitted).
The party seeking the award of fees must submit evidence to support the
request. Van Gerwen v. Guar. Mut. Life Co., 214 F.3d 1041, 1045 (9th Cir. 2000).
Specifically, the party must support the request with evidence regarding the
“number of hours worked and the rates claimed.” Id. The party opposing the fee
request bears the “burden of rebuttal that requires submission of evidence to the
district court challenging the accuracy and reasonableness of the hours charged or
the facts asserted by the prevailing party in submitted affidavits.” Common Cause
v. Jones, 235 F.Supp.2d 1076, 1079 (C.D. Cal. 2002) (quoting Gates, 987 F.2d at
1397).
///
///
///
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2. Analysis
a. The Attorney/Other Hourly Rates Claimed by Defendants
Are Reasonable and Commensurate with the Prevailing
Rate.
Defendants claim the following hourly rates for their counsel: $470.00 in
2023 and $510.00 in 2024 for Mr. M. Adam Tate; $450.00 in 2023 and $475.00 in
2024 for Ms. Catherine Close; $300.00 for Mr. Adam J. Schwartz; and $150.00 in
2023 and $185.00 in 2024 for Ms. Rebekah Chamberlain. (Tate Third Decl. ¶¶ 9.a.;
9.b.; 9.c.; 9.d.) Defendants also claim an hourly rate of $200.00 in 2023 and
$210.00 in 2024 for Ms. Helene Saller, a paralegal. (Id. ¶ 9.e.) BCS does not
dispute these rates. (See generally Mot.; see generally Mot. Suppl.)
The Court fully analyzed the reasonableness of these rates in its July 25,
2024 order on Defendants’ request for attorneys’ fees in connection with another
discovery motion (“Slack Fees Order”). (See ECF No. 212.) Although the 2024
rates requested here are slightly higher than the 2023 rates approved in the Slack
Fees Order, the difference is neither appreciable nor consequential to the analysis
here. For the reasons detailed in the Court’s July 25, 2024 order, the Court finds
the rates requested by Defendants to be reasonable for purposes of an attorneys’
fees award. (See id. at 20–24.)
b. Some of the Hours Billed Are Excessive and/or
Unrecoverable Under Rule 37.
Defendants’ request for $72,445.5011 in attorneys’ fees is based upon the
following lodestar calculation of stated hours multiplied by the hourly rates detailed
(and approved) above. For ease of reference, the Court organizes the fees
according to the challenges presented by BCS, detailed below.
11 Both parties assert that Defendants seek fees in the amount of $72,779.00. (Mot.
Suppl. 6, 10–11.) The Court calculates the total fees sought as $72,445.50. The
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Biller Hours
Billed
Rate
Billed Sub-Total
ATTENDANCE AT DISCOVERY CONFERENCES
Tate (IDCs 3-6) 8.2 $470.00 $3,854.00
Tate (IDC 10) 12.5 $470.00 $5,875.00
Tate (March/April Status Conferences) 15.0 $510.00 $7,650.00
Close (IDCs 3-6) 6.2 $450.00 $2,790.00
Close (IDC 10) 8.5 $450.00 $3,825.00
Close (IDC 13) 1.4 $450.00 $630.00
Close (March/April Status Conferences) 1.0 $475.00 $475.00
Schwartz (IDCs 3-6) 6.2 $300.00 $1,860.00
Schwartz (IDC 10) 5.0 $300.00 $1,500.00
Schwartz (IDC 13) 1.0 $300.00 $300.00
Chamberlain (IDC 10) 10.1 $150.00 $1,515.00
Subtotal: Discovery Conferences 71.1 $30,274.00
PREPARATION OF MOTION FILINGS
Tate (Motion) 15.0 $470.00 $7,050.00
Close (Motion) 3.7 $450.00 $1,665.00
Chamberlain (Motion) 28.3 $150.00 $4,245.00
Saller (Motion) 4.0 $200.00 $800.00
Tate (Tate Supplemental Declaration) 0.5 $470.00 $235.00
Close (Tate Supplemental Declaration) 3.5 $450.00 $1,575.00
Chamberlain (Tate Supplemental Declaration) 4.0 $150.00 $600.00
Saller (Tate Supplemental Declaration) 0.5 $200.00 $100.00
Tate (Motion Supplement) 6.5 $510.00 $3,315.00
Close (Motion Supplement) 10.7 $475.00 $5,082.50
Subtotal: Motion Filings 76.7 $24,667.50
Court identifies three errors that account for this negative $333.50 difference: (1)
the grand total fees based on the fees breakdown is $72,308.50, not $72,779.00 (see
Mot. Suppl. 7–10); (2) the sub-total fees for “Preparing the accounting for the
Subpoena Discovery Fees” are $1,989.00, not $1,852.50 (see id. at 10); and (3) the
sub-total fees for “Drafting the Instant Joint Statement” are $8,397.50, not
$8,397.00 (see id.) The Court proceeds based on its own calculations.
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Biller Hours
Billed
Rate
Billed Sub-Total
PREPARATION OF SUBPOENA DISCOVERY FILINGS
Tate (Phase 1 Status Report) 0.4 $470.00 $188.00
Tate (Phase 1 Status Report) 9.2 $510.00 $4,692.00
Tate (Motion re Subpoena Discovery Fees) 9.6 $510.00 $4,896.00
Close (Phase 1 Status Report) 0.9 $450.00 $405.00
Close (Phase 1 Status Report) 3.0 $475.00 $1,425.00
Close (Motion re Subpoena Discovery Fees) 11.4 $475.00 $5,415.00
Saller (Phase 1 Status Report) 0.5 $210.00 $105.00
Saller (Motion re Subpoena Discovery Fees) 1.8 $210.00 $378.00
Subtotal: Subpoena Discovery Filings 36.8 $17,504.00
GRAND TOTAL $72,445.50
(Mot. Suppl. 7–10.)
BCS challenges the fees requested by Defendants on multiple grounds. First,
BCS argues that $20,279.00 should be deducted from the requested fees because
that amount corresponds to work associated with the Subpoena Discovery and a
different discovery dispute (“Slack Discovery”), both of which are the subject of
separate fees requests. (Mot. Suppl. 11.) Second, BCS contends that, of the
remaining $52,500.00 in fees, Defendants may recover only those fees incurred in
drafting the Motion, the Tate Supplemental Declaration, and the Motion
Supplement, and that those fees, which total $24,667.50,12 should be reduced to
$8,386.78 or less. (Id. at 15–16.) Third, BCS argues that neither (1) the fees
incurred in (1) the preparation for and attendance of IDCs and hearings
///
///
12 Per the table above, the Court’s calculation yields a total of $24,667.50 for the
drafting of the Motion, the Motion Supplement, and the Tate Supplemental
Declaration, in comparison to BCS’s total of $24,667.50. (Mot. Suppl. 11.) The
Court proceeds based on its own calculation.
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($9,995.0013), nor (2) the fees for the work related to the Subpoena Discovery
($17,367.5014), are recoverable under Rule 37(b)(2) in the first instance and, even if
they were, the imposition of these fees is not warranted because there is no
evidence that BCS’s discovery violations caused Defendants to incur those fees, as
required under Rule 37(b). (Id. at 17–19.)
The Court addresses each challenge in turn and, for the reasons stated below,
concludes that the some of the fees requested by Defendants are excessive and/or
unrecoverable under Rule 37(b)(2) and reduces the requested attorneys’ fees from
$72,445.50 to $34,986.50.
(i) A blanket reduction of $20,279.00 for fees related
to the Slack Discovery and the Subpoena Discovery
is not warranted.
Pointing to the Court’s admonition to Defendants that “they may not request
fees that are duplicative of those already requested as to the Subpoena Motion and
the Slack Motion,” BCS argues that $20,279.00 of the $72,779.00 requested fees is
for the Slack Discovery and the Subpoena Discovery and should not be considered
here. (Mot. Suppl. 16 (citing ECF No. 210 at 4).) However, other than its
conclusory assertion, BCS offers no evidence of this overlap. (See generally Mot.
Suppl.) Indeed, the basis of BCS’s claimed $20,279.00 overlap is unclear given
that $20,279.00 is the amount Defendants sought for the Slack Discovery only, not
any work related to the Subpoena Discovery. In any event, the Court already has
adjudicated the fees request for the Slack Discovery and will account for any
13 Although Plaintiff does not explain this figure, the Court believes it represents
the difference between the $30,274.00 fees for “Attendance at IDCs and Hearings”
and the $20,279.00 fees requested in connection with the Slack Discovery, which
BCS contends should not be awarded twice. (Mot. Suppl. 16.)
14 This $17,367.50 figure contains a calculation error identified above; the correct
amount for the “Subpoena Discovery Filings” is $17,504.00.
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overlap in this order. And, when the Court adjudicates the fees request for the
Subpoena Discovery, it will do the same. A blanket $20,279.00 reduction is not
warranted. On this basis, the Court DENIES this request.
(ii) The $30,274.00 requested for time spent on
informal discovery conferences and status
conferences is not fully warranted.
Defendants request a combined 75.1 hours for preparing for and attending
IDCs 3 through 6 (held before the filing of the Motion) and IDCs 10 and 13 and the
March/April Status Conferences (“Discovery Conferences”). (See supra.) BCS
objects to any award of fees for hours related to the Discovery Conferences on two
grounds: (1) this Court’s statement that such fees are not recoverable; and (2) that
Defendants fail to explain how BCS’s violations caused Defendants to incur the
requested fees. (Mot. Suppl. 17–19.)
Addressing first the statement attributed to this Court, the Court agrees that it
stated at IDC 10 that the time Defendants sought under the Motion for meeting and
conferring and attending informal discovery conferences is not recoverable. (Tr.
IDC 10, at 55.) However, the Court stands persuaded by Defendants’ argument
providing authority to the contrary. (Mot. Suppl. 12–14.) Indeed, Courts in this
Circuit have awarded attorneys’ fees under Rule 37 for time spent preparing for and
attending informal discovery conferences. See, e.g., MP Nexlevel of Cal, Inc. v.
CVIN, LLC, No. 1:14-cv-00288-LJO-EPG, 2016 U.S. Dist. LEXIS 139407, at *10
(E.D. Cal. Oct. 5, 2016) (awarding attorneys’ fees under Rule 37(b)(2)(C) for time
spent preparing for and participating in informal discovery conference); Andreoli v.
Youngevity Int’l, Inc., No. 16-cv-02922-BTM-JLB, 2019 U.S. Dist. LEXIS 100298,
at *25 (S.D. Cal. June 14, 2019) (awarding attorneys’ fees for meet and confer
efforts under Rule 37(b)(2)(C)); Premiere Innovations, Inc. V. Iwas Indus., LLC,
No. 07cv1083-BTM(BLM), 2009 U.S. Dist. LEXIS 142894, at *8 (S.D. Cal. May
8, 2009) (same).
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Here, Defendants prepared for and attended four telephonic pre-Motion IDCs
that involved BCS’s production under the EDO—IDC 3 on April 18, 2023, IDC 4
on April 24, 2023, IDC 5 on May 1, 2023, and IDC 6 on May 3, 2023. IDC 3
lasted two hours (see IDC 3 Order, ECF No. 52); IDC 4 lasted two hours and ten
minutes (see IDC 4 Order, ECF No. 54); IDC 5 lasted two hours and ten minutes
(see IDC 5 Order, ECF No. 56), and IDC 6 lasted two hours (see IDC 6 Order), for
a total of eight hours and twenty minutes. However, the Court notes that these
conferences addressed more than just the issues raised in the Motion; rather, they
addressed significant issues related to depositions and the Slack Discovery (for
which fees already have been awarded). Accordingly, the Court will reduce the 8.3
hours attributed to this Motion by two-thirds, for a total of 2.7 hours. In addition,
the Court notes that Defendants seek to recover these hours for three attorneys. The
Court finds this excessive as one attorney would have been sufficient. The Court
will allow 2.7 hours for appearance at the conferences plus one hour for
preparation, for a total of 3.7 hours, at the 2023 rate of Defendants’ lead counsel—
Tate at $470.00—for a total of $1,739.00.
In addition, Defendants prepared for and attended four post-Motion informal
conferences—IDC 10, IDC 13, and the March/April Conferences. IDC 10 lasted
three hours and ten minutes (see IDC 10 Order); IDC 13 lasted 45 minutes (see IDC
13 Order); and the March/April Conferences combined lasted four hours (see
March/April Conferences Order, ECF No. 196), for a total of seven hours and fiftyfive minutes, all of which concerned solely the subject matter of this Motion.
As to the fees sought for IDC 10, the Court notes that it ordered “[a]ll
attorneys involved in any way with the Motion and the discovery that is the subject
of the Motion” to appear in person at IDC 10 (ECF No. 114), and advised the
parties that the attorneys’ fees for attending IDC 10 would be recoverable as part of
the sanctions requested in the Motion (Tr. IDC 10, at 55). BCS argues that the
Court’s IDC 10 comment should be disregarded at this time because “in the nine
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months between that IDC and [submission of the Motion Supplement], there have
been significant developments and the parties’ circumstances have changed
drastically . . . .” (Mot. Suppl. 18, n.2.) But what happened after IDC 10 is not the
question here; rather, the Rule 37(b) causation inquiry is whether Defendants
should recover the fees for the work expended to resolve the dispute that created the
need for IDC 10. On this basis, the Court will award Defendants 26 hours for
attending IDC 1015 at the respective hourly rates for the four attorneys who
attended as ordered—Tate, Close, Schwartz, and Chamberlain—for a total of
$8,990.00. It is unclear to the Court what preparation would have been necessary
for IDC 10, for either counsel or the paralegal, given that the Court convened IDC
10 in response to the filing of the Motion merely three weeks earlier. (See
generally IDC 10 Transcript.) Thus, the Court does not award any fees for
preparation for IDC 10.
As to IDC 13 and the March/April Conferences, the Court again finds
excessive the appearance of multiple attorneys when one attorney would have been
sufficient. The Court will allow 4.75 hours for the appearances and 2.5 hours of
preparation, for a total of 7.25 hours, at the rate of Defendants’ lead counsel—again
15 Seven hours for each of Tate at $470.00 per hour, Close at $450.00 per hour, and
Chamberlain at $150.00 per hour, and five hours for Schwartz at $300.00 per hour.
This includes travel time, which is recoverable under Rule 37(b)(2)(C). See, e.g.,
Nilsson, Robbins, Dalgarn, Berliner, Carson & Wurst v. Louisiana Hydrolec, 854
F.3d 1538, 1547 (9th Cir. 1988) (upholding district court’s imposition of various
sanctions under Fed. R. Civ. P. 37(b)(2)(C), including terminating sanctions,
attorneys’ fees, and travel expenses); Cadles of West Virginia, LLC, No. 0-CV2534-TWR-WVG, 2022 WL 5133478, at *11 (S.D. Cal. Oct. 4, 2022) (including
“travel expenses” for client representative’s appearance at OSC hearing in award of
fees and costs under Rule 37(b)(2)(C)); Stewart Title Guar. Co. v. 2485 Calle del
Oro, LLC, No. 15-CV-2288-BAS(WVG), 2017 U.S. Dist. LEXIS 124510 *, at
*38–39 (S.D. Cal. Aug. 7, 2017) (finding that “Rule 37(b)(2)(C) mandates an
award of expenses related to the instant sanctions motion,” including expenses for
the plaintiff’s attorney to “travel to, and appear at, the sanctions hearing”), adopted
in relevant part by 2017 U.S. Dist. LEXIS 182845 (S.D. Cal. Nov. 3, 2017).
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Tate at $470.00 per hour—for a total of $3,697.50.
For these reasons, the Court GRANTS in part and DENIES in part
Defendants’ request for attorneys’ fees expended in Discovery Conferences. The
Court will award a total $14,426.50 for this category of work.
(iii) The $24,667.50 requested for the preparation of
this Motion and its related filings is not fully
warranted.
Defendants request a combined total of 76.7 attorney and paralegal hours for
preparation of the Motion and related filings, of which 51 hours were spent on the
Motion, 8.5 hours on the Tate Supplemental Declaration, and 17.2 hours on the
Motion Supplement and the Tate Third Declaration (collectively, “Motion
Filings”). (Mot. Suppl. 7–10.)
BCS does not dispute the recoverability of the fees related to the Motion
Filings. (Mot. Suppl. 11.) However, BCS asks the Court to reduce the fees to
$8,386.78 or substantially less. (Id. at 11–12.) BCS argues that charging 60 hours
for the Motion and the Supplemental Declaration is unreasonable because, although
the Motion “presented only a handful of discovery issues,” Defendants structured
the Motion “in a way that made it redundant, inefficient, and unnecessarily long,”
requiring counsel to “spend[] far too much time,” rather than the fraction of time it
should have taken. (Mot. Suppl. 20–21.) In addition, BCS argues that the 17.2
hours sought for the preparation of the Motion Supplement is unreasonable given
that Defendants’ cut and pasted the section regarding fees from the Slack Discovery
motion (for which Defendants separately sought, and have been awarded, fees) and
otherwise compiled and summarized invoices and time entries, an administrative
task that that could have been handled by a paralegal rather than two lawyers. (Id.
at 20.)
As a starting point, the documented 59.5 hours for the Motion and the Tate
Supplemental Declaration exceed those awarded in this district for the preparation
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of a discovery motion by at least fifty-three percent (53%). See, e.g., Nguyen v.
Regents of the Univ. of Cal., No. 8:17-cv-00423-JVS-KESx, 2018 U.S. Dist.
LEXIS 226622, at *9–12 (C.D. Cal. May 18, 2018) (approving 38.9 hours for the
preparation of a joint stipulation); Dish Network L.L.C. v. Jadoo TV, Inc., No. 2:18-
cv-9768-FMO (KSx), 2019 U.S. Dist. LEXIS 221869, at *18 (C.D. Cal. Nov. 8,
2019) (approving 32 hours for the preparation of a discovery motion). And,
although the Motion and the Supplemental Tate Declaration came accompanied by
exhibits, the Court finds, based on its own experience, that the supporting
documentation does not exceed that of a typical discovery motion. In addition, the
Court notes that the time entries for Tate, Close, Chamberlain, and Saller related to
the Motion include entries for the filing of a request to seal documents, which did
not occur in connection with the Motion. (See Def. Ex. 1-2, at 2, 5, 11, 12.) For
these reasons, the Court finds that 59.5 hours does not represent a reasonable
amount of time for the preparation of the Motion and the Tate Supplemental
Declaration. On this basis, the Court finds it appropriate to reduce the 59.5 hours
by 50%, for a total of 29.75 hours and $8,135.00 in fees based on the applicable
hourly rates detailed above.
With respect to the 17.2 hours sought for the Motion Supplement, the Court
agrees with Plaintiff that the vast majority of the Motion Supplement and the Tate
Third Declaration appears to involve cutting and pasting and administrative tasks.
For this reason, the Court will award five attorney hours at Ms. Close’s hourly rate
of $475.00 and twelve paralegal hours at Ms. Saller’s hourly rate of $200.00, for a
total of $4,775.00 in fees.
For these reasons, the Court GRANTS in part and DENIES in part
Defendants’ request for attorneys’ fees expended in the preparation of the Motion
Filings. The Court will award a total $12,910.00, for this category of work.
///
///
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(iv) The $17,504 requested for the preparation of the
Phase 1 Status Report and the briefing on the
Subpoena Fees Motion is not fully warranted.
Defendants request a combined 36.8 hours for the preparation of the Phase 1
Status Report and the opposition to Plaintiff’s motion to reduce fees related to the
Subpoena Discovery. (See supra.)16 BCS objects to the award of any fees related
to this work because it “ha[s] nothing to do with the [Motion].” (Mot. Suppl. 19.)
As a starting point, BCS cannot dispute that Phase 1, which included the
Subpoena Discovery, was the product of IDC 10 which was convened by the Court
in response to the Motion. (See generally Tr. IDC 10.) Nor does BCS dispute that
the Court ordered Defendants to file the Phase 1 Status Report to apprise it of the
outcome of Phase 1, including the Subpoena Discovery. (See generally Mot.
Suppl.; see also IDC 10 Order ¶ 5.) Nor does BCS dispute that the parties agreed
through the IDC 10 Agreement that the attorneys’ fees expended in the Subpoena
Discovery would be adjudicated pursuant to motion practice at the conclusion of
Phase 1. (See generally Mot. Suppl.; see also IDC 10 Agm’t ¶ 7.) Thus, it cannot
16 To be clear, the fees requested here are distinct from the fees and costs incurred
by Defendants in prosecuting the subpoenas. Those fees, which are the subject of
separate motion practice that will be adjudicated after the adjudication of this
Motion, are limited by Court order to the fees Defendants expended in the
prosecution of subpoenas issued to the uncooperative officers and directors of BCS.
(See Tr. IDC 10; see also IDC 10 Agm’t ¶ 7 (limiting the motion for recovery of the
expenses associated with the Subpoena Discovery to those “attorneys’ fees and
costs incurred by Defendants in any subpoena and related motion practice necessary
to obtain or compel the production of the discovery at issue in the Motion from the
officers and directors of BCS.”).) The fees requested here, on the other hand,
involve the reporting of the outcome of Phase 1, as ordered by the Court, and the
briefing of Plaintiff’s motion to reduce the subpoena prosecution fees. Thus, there
is no overlap between the fees requested here and the fees requested by Defendants
to prosecute the subpoenas.
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be said that these filings “have nothing to do with the [Motion].” To the contrary,
Defendants would not have engaged in Phase 1 activity but for BCS’s failure to
comply with the EDO. On this basis, the Court concludes that Defendants are
entitled to an award of the fees expended in the preparation of the Phase 1 Status
Report and in responding to BCS’s motion to reduce Defendants’ Phase 1 subpoena
prosecution fees.
That said, the Court nevertheless must determine whether the fees requested
for the Subpoena Discovery are reasonable. Defendants claim 14 hours for the
preparation of the Phase 1 Status Report, for a total of $6,815.00 in fees, and 22.8
hours for the preparation of the opposition to Plaintiff’s motion to reduce Subpoena
Discovery fees, for a total of $10,689.00 in fees. Both are excessive.
As to the Phase 1 Status Report, the Court notes it consists of a five-page
compilation and recitation of the results of the Subpoena Discovery, which
Defendants had to monitor as part of Phase 1 (and for which monitoring Defendants
seek fees through a separate fees motion) and could have been prepared by a
paralegal alone, while the remaining eight pages consist of legal analysis regarding
prejudice to Defendants, requiring the attention of an attorney. (See generally
Status Rpt.) The Court concludes that a reasonable amount of time for the
preparation of the Phase 1 Status Report, is seven hours, which the Court will
award at the 2024 hourly rate of Defendants’ lead attorney—Tate at $510.00 per
hour—for a total of $3,570.00.
As to Defendants’ opposition to Plaintiff’s motion for Subpoena Discovery
fees, the Court notes that Defendants seek work for two attorneys, while the work
could have been completed by one attorney. On this basis, the Court reduces the
attorney hours by 50%, from 22.8 hours to 11.4 hours. In addition, the Court notes
that approximately three of the Defendants’ approximately ten pages (30%) of that
motion (ECF No. 211) are dedicated to an affirmative request for sanctions against
BCS and its counsel, an impermissible practice as courts in this and other districts
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have concluded that a request for affirmative relief raised for the first time in an
opposition is not proper. See, e.g., Interworks Unlimited, Inc. v. Digital Gadgets,
LLC, No. CV 17-04983 TJX (KSx), 2019 U.S. Dist. LEXIS 167149, at *3–4 (C.D.
Cal. June 11, 2019) (party responding to motion “cannot seek affirmative relief by
way of an opposition brief”), Finjan, Inc. v. Blue Coat Sys., Inc., No. 13-cv-03999-
BLF, 2015 U.S. Dist. LEXIS 74566, at *13 n.8 (N.D. Cal. June 2, 2015) (asking to
strike infringement theories is not “a request for relief properly presented in an
opposition brief”); Pac. Coast Steel v. Stoddard, No. 11cv2073 H(RBB), 2013 U.S.
Dist. LEXIS 199213, at *41 (S.D. Cal. Feb. 15, 2013) (declining to grant
affirmative relief, “precluding an expert witness from testifying at trial, based on a
request included in an opposition to a motion”); Thomason v. GC Servs. L.P., No.
05cv0940-LAB (CAB), 2007 U.S. Dist. LEXIS 54693, at *21 (S.D. Cal. July 16,
2007) (“[T]he court rejects any discovery-related or other requests for affirmative
relief Plaintiffs attempt to piggy-back on their Opposition as inappropriate,
untimely, and obfuscating.”); Karma Auto. LLC v. Powersource Llc, No. CV 16-
00530 TJH (MRWx), 2017 U.S. Dist. LEXIS 235557, at *3–4 (C.D. Cal. July 27,
2017) (denying request for sanctions made in an opposition brief and citing Local
Rule 6-1 for the proposition that courts may decline to rule on a request that is not
brought as a properly noticed motion). On this basis, the Court reduces the 11.4
hours by 30%, for a total of 8 hours, and awards them at the 2024 hourly rate of
Defendants’ lead counsel—Tate at $510.00—for a total of $4,080.00.
For these reasons, the Court GRANTS in part and DENIES in part
Defendants’ request for attorneys’ fees expended in the Subpoena Discovery. The
Court will award a total $7,650.00, for this category of work.
(v) The fees sought here were necessitated by BCS’s
failure to comply with the EDO.
BCS argues that, even if the fees requested here could be recoverable under
some circumstances, they are not here because the work that generated these fees
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///
was not “caused by” BCS’s alleged violations of the EDO, as required by Rule
37(b)(2). (Mot. Suppl. 19.)
It is not a common occurrence for the undersigned to be taken aback by a
party’s argument. Yet, here, the Court is forced to take a deep breath and simply
say: no statement could be further removed from reality. The history of this
dispute paints an indelible picture of BCS’s discovery violations for which
Defendants were forced to seek Court intervention and, in the process, exercise
every ounce of patience in their beings as the Court insisted on holding BCS’s hand
for over a year in an effort to guide it into compliance—all out of the deepest
respect for the mission of the organization. (IDC 10 Tr. 8.) Still, the docket in this
case, the transcripts of the IDCs, the tables and charts generated through this
dispute, the depositions and declarations of BCS’s leadership, the lack of
responsiveness to Court orders (including subpoenas), and the Court’s deepening
admonishments, all bear witness to the persistent and unyielding refusal of BCS’s
officers and directors to comply with BCS’s discovery obligations from the
beginning of this dispute. For over a year, in a steady crescendo, each response
raised more questions, each partial production suggested more missing or spoliated
documents, each conference compelled a follow-up, each filing required updates,
each extension necessitated more time, all to culminate in the disappointing finale
that, because some of BCS’s highest ranking officers and directors refused to
produce their documents, the only remaining path forward was adjudication of
Defendants’ Motion and its request for monetary sanctions.
Lest BCS have forgotten, the Court recounts the ordeal under the Rule 37(b)
sanctions standard. But for BCS’s failure to comply with the EDO in its document
production, IDC 3 would not have been necessary and those fees would not have
been incurred. But for BCS’s inability at IDC 3 to provide a timeline for the
expected completion of its searches and production (see Tr. IDC 3; IDC 3 Order),
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IDC 4 would not have been necessary and those fees would not have been incurred.
But for BCS’s admission at IDC 4 that it had not completed its search and
document production of the BCS Data Sources and had not searched at all through
any of the Personal Data Sources (see Tr. IDC 4; Defs.’ Ex. 5; IDC 4 Order), IDC 5
would not have been necessary and those fees would not have been incurred. But
for the inability of BCS to obtain information from some of its officers and
directors to respond at IDC 5 to the Court’s inquiry of whether they personally had
any of the Data Sources and voluntarily would produce their BCS-related
documents contained therein (see Tr. IDC 5; Defs.’ Exs. 7–9; IDC 5 Order), IDC 6
would not have been necessary and those fees would not have been incurred. But
for the written confirmation from some of BCS’s officers and directors at IDC 6
that, although they had Personal Data Sources, they would not voluntarily produce
BCS-related documents therefrom, and the refusal of other BCS officers and
directors to respond to the Court’s inquiry altogether (see Tr. IDC 6; Defs.’ Ex. 10;
IDC 6 Order), the Motion would not have been necessary and those fees would not
have been incurred. But for the overarching lack of cooperation by BCS’s officers
and directors in providing the facts needed for the Court to properly assess the
Defendants’ claim of prejudice in the Motion, (see Tr. IDC 10; IDC 10 Order), IDC
10 and Phase 1 would not have been necessary and those fees would not have been
incurred. But for the refusal of some of BCS’s officers and directors to cooperate
in the Phase 1 Voluntary Discovery (see IDC 13 Order; Status Rpt.), the Phase 1
Subpoena Discovery would not have been necessary and those related fees would
not have been incurred. But for the failure of some of BCS’s officers and directors
to accept service of the subpoenas they knew were forthcoming and/or comply with
their subpoena obligations once served (see Status Rpt.), the Phase 1 Status Report
and Subpoena Discovery motion practice would not have necessary and those fees
would not have been incurred. To now hear BCS’s contention that the misconduct
of its officers and directors was not the cause of the fees expended by Defendants—
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all to obtain the benefits of the EDO that BCS itself co-authored—is nothing short
of bewildering. BCS’s officers and directors need look no further than among their
own ranks to find the architects of the circumstances that have compelled the award
of sanctions here. The Court is not persuaded by BCS’s “lack of causation”
argument and readily imposes the sanctions discussed above.
c. The re-calculated Lodestar results in an attorneys’ fees
award of $34,986.50 and no Kerr adjustment is
necessary.
The Court re-calculates the lodestar for a total of $34,986.50 as follows:
Work Performed Sub-Total
Subtotal: Discovery Conferences $14,426.50
Subtotal: Motion Filings $12,910.00
Subtotal: Subpoena Discovery $7,650.00
TOTAL $34,986.50
Neither party requests an adjustment to the lodestar based on the Kerr
factors. (See generally Mot.) Indeed, upon a review of the Kerr factors not already
subsumed within the lodestar, the Court sees no reason to make such an adjustment.
On this basis, the final attorneys’ fee award pursuant to Rule 37(b)(2)(C) is
$34,986.50.
D. BCS Is Responsible for Paying the Sanction.
Defendants request that the Court impose the requested monetary sanctions
against BCS and its counsel, but sets forth no argument as to why counsel, in
addition to BCS, should be sanctioned. (Mot. 64.) Beyond stating that the
requested sanctions are not warranted, BCS does not address who should be
responsible for paying any awarded monetary sanctions. (Id. at 73–74.) Based on
its review of the record, the Court imposes the sanctions ordered herein against
BCS only. The Court finds no reason to order BCS’s counsel to pay the mandated
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sanctions. See, e.g., Lee v. Dennison, No. 2:19-cv-1332-KJD-DJA, 2020 U.S. Dist.
LEXIS 185985, at *13 (D. Nev. Oct. 7, 2020) (declining to impose sanctions
against counsel in addition to sanctioned party because the “parties
expressed no opinion on this aspect” and the court found “no reason to include
Plaintiff’s counsel” in the monetary sanctions order).
IV. CONCLUSION
For the reasons set forth above, the Court GRANTS in part and DENIES in
part Defendants’ Motion and ORDERS as follows:
1. Defendants’ request for an order compelling BCS to produce
documents from the BCS Data Sources and the Personal Data Sources
not already produced is DENIED as moot.
2. Defendants’ request for evidentiary sanctions against BCS for its
failure to comply with the EDO is DENIED as moot.
3. Defendants’ request for monetary sanctions is GRANTED in part and
DENIED in part. BCS is ORDERED to pay Defendants’ attorneys’
fees in the amount of $34,986.50 by no later than January 15, 2025
or on a later date or dates by agreement of the parties or further order
of the Court upon properly-noticed motion.
4. BCS is ORDERED to (a) serve, pursuant to Rule 4, a copy of this
Order on every person who, as of the date of this Order, held or holds a
position as Member of BCS’s Board of Directors (“Current Board
Member”) or Officer of BCS (“Current Officer”) by no later than
fourteen (14) days after the date of this Order, and (b) file either
(i) a proof of such service, or (ii) an under-oath declaration by the
highest ranking Current Board Member or Current Officer as to why
any such service has not been made, by no later than twenty-one (21)
days after the date of this Order.
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5. BCS is ORDERED to (a) serve, pursuant to Rule 4, a copy of this
Order on every person who, subsequent to the date of this Order, takes
on a position as Member of BCS’s Board of Directors (“Future Board
Member”) or Officer of BCS (“Future Officer) by no later than seven
(7) days after such person takes on such position, and (b) file either
(i) a proof of such service, or (ii) an under-oath declaration by the then
highest ranking Board Member or Officer as to why such service has
not been made, by no later than fourteen (14) days after such
person takes on such position. This is an ongoing obligation that
expires only at such time as BCS has fully complied with the Order to
pay to Defendants the sum of $34,986.50.
6. BCS is hereby cautioned that failure to obey this Order, including
making payment on a timely basis, may result in the imposition of
further sanctions pursuant to Rule 37(b), including treating its
failure to obey this Order as contempt of court. BCS also is
cautioned that instead of or in addition to the above sanctions, the
Court could order BCS, its attorney, or both, to pay the
reasonable expenses, including attorneys’ fees, caused by their
failure to comply with this Order.
7. BCS’s Current and Future Officers and Board Members are
hereby cautioned that, under certain circumstances, they too could
be held personally liable for sanctions, including sanctions for
contempt of court, for BCS’s failure to comply with this Order.
DATED: September 6, 2024

HONORABLE MARIA A. AUDERO UNITED STATES MAGISTRATE JUDGE
Case 2:22-cv-02052-MAA Document 221 Filed 09/06/24 Page 49 of 49 Page ID
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