In Corker, et al. v. Costco Wholesale, et al., No. C19-0290RSL (W.D. Wash. Apr. 27, 2020), Washington District Judge Robert S. Lasnik granted the plaintiffs’ motion to compel defendant BBC Assets to produce a document, that had previously been produced as a 2,269-page PDF, in its original native Excel format without redactions and also granted the plaintiffs’ motion to seal the document for confidentiality reasons, while denying defendant BBC Assets’ motion for a protective order confidential commercial information contained in the responsive spreadsheets.

Case Background

In this case involving claims of false designation of origin, false advertising, and unfair competition under Section 43(a) of the Lanham Act over sales of coffee with the “Kona” designation, defendant BBC Assets was asked to respond to a request for documents sufficient to identify the volume and price of “Kona” coffee it sold and they produced summary documents purporting to provide the requested information. When the plaintiffs objected to the form of the production, BBC Assets produced a 2,269-page document that appeared to be a spreadsheet converted into a static PDF, with significant redactions obscuring sales information regarding non-Kona brands. In response, the plaintiffs filed a motion to compel production of the spreadsheet as kept in the ordinary course of business and without redactions. In support of the motion, the plaintiffs filed under seal an excerpt of the redacted document.  BBC Assets, in turn, sought an order protecting from disclosure irrelevant and confidential commercial information contained in the responsive spreadsheets.

Judge’s Ruling

Referencing FRCP Rule 34(b)(2)(E)(ii), Judge Lasnik stated: “The rule does not require a party to produce electronically stored information in the form it which it is ordinarily maintained, as long as it is produced in a reasonably usable form. But the option to produce in a reasonably usable form does not mean that a responding party is free to convert electronically stored information from the form in which it is ordinarily maintained to a different form that makes it more difficult or burdensome for the requesting party to use the information efficiently in the litigation.”

“BBC Assets’ initial production was plainly insufficient under the rule: the summaries were not in the form in which the information was ordinarily maintained, nor did it have the functionality of the native format that made it so valuable for business purposes and which would enable plaintiffs to use the information efficiently. The PDF images of the spreadsheets suffer from similar problems. Even if the PDF images of the spreadsheet pages are ‘readable’ and ‘searchable’, they cannot be sorted or filtered as the original spreadsheet could be. Thus, they are likely not in a ‘reasonably usable form’ for purposes of Rule 34(b)(2)(E).”

While noting that “In its motion for a protective order, BCC Assets implicitly acknowledges the functional limitations of its PDF production and offers instead a report in Excel format that contains all of the relevant information responsive to plaintiffs’ discovery request while filtering/hiding irrelevant and commercially sensitive information regarding non-Kona brands and sales”, Judge Lasnik stated: “This brings up the second concern regarding BCC Assets’ production: is a party permitted to redact material from responsive documents? If the redaction is based on the producing party’s unilateral assessment of relevance, the answer is generally ‘no.’”

However, Judge Lasnik went on to say “The Court need not resolve this issue because BCC Assets’ refusal to produce (and request for a protective order) is not based solely on a relevance objection. Rather, BCC Assets argues that the information it has withheld is highly confidential and its disclosure in this litigation would put it at a competitive disadvantage… But BCC Assets has already stipulated to what the appropriate protections are in such circumstances. The Protective Order entered in this litigation allows BCC Assets to designate as for ‘Plaintiffs’ Outside Counsel Only’ information that it deems inappropriate to be shared with another party for competitive or proprietary business reasons. The parties agreed that this level of protection would be appropriate where the disclosure of information to a competitor would be highly prejudicial to their businesses: the designation limits the disclosure to plaintiffs’ outside counsel… While a stipulated protective order does not waive a party’s right to request additional protections in particular circumstances, BCC Assets has not shown why the agreed restrictions on the way in which commercially-sensitive information will be produced are insufficient or should be altered at this stage of the proceeding.”

As a result, Judge Lasnik granted the plaintiffs’ motion to compel and motion to seal, while denying defendant BCC Assets’ motion for a protective order.

So, what do you think?  Should an ‘Outside Counsel Only’ access designation compel a party to produce information that is confidential?  Please share any comments you might have or if you’d like to know more about a particular topic.

Case opinion link courtesy of eDiscovery Assistant.

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