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Boyette Brothers Produce, LLC v. Arvila LLC

United States District Court, E.D. North Carolina, Western Division

May 16, 2017

Boyette Brothers Produce, LLC, Plaintiff/Counterclaim-Defendant,
Arvila, LLC, et al., Defendants/Counterclaim-Plaintiffs.


          Robert T. Numbers, II United States Magistrate Judge

         Plaintiff Boyette Brothers Produce, LLC request that the court issue a protective order both relieving it from the need to respond to various discovery requests served by Defendants- Arvila, LLC; TMF Florida, LLC; Florian Braich; and Angela Braich-and quashing subpoenas issued to 11 sweet potato growers in eastern North Carolina. Defendants' discovery requests are overbroad as written, but they can be revised in a manner that limits them to issues that are both relevant and proportional to the needs of the case. And although Boyette Brothers has not shown that it has standing to quash the subpoenas, the court will, on its own, quash the subpoenas for the time being because they were served without any indication that the recipients have relevant information. Thus Boyette Brothers' motion will be granted in part and denied in part. The court will also issue a protective order to address any concerns over production of confidential business information.

         I. Background

         In November 2014, Boyette Brothers and TMF, a subsidiary of Arvila, [1] entered into an agreement related to the sale of Boyette Brothers' sweet potatoes in the European market. The exact nature of the relationship between the parties is disputed. Boyette claims that it was selling the sweet potatoes directly to Arvila, while Arvila claims that it was merely responsible for finding new customers who would purchase Boyette Brothers' produce. Over an eight month period in 2014 and 2015, Boyette Brothers made 28 shipments of sweet potatoes to purchasers in the European market. The ultimate recipients of the sweet potatoes refused to pay for 10 of the shipments because they were allegedly of poor quality.

         Boyette Brothers claims that it is entitled to payment from the Defendants for these 10 shipments. The Defendants reject Boyette Brothers' arguments and also claim, among other things, that it is not responsible to pay for the rejected shipments because Boyette Brothers “fail[ed] to load the containers with produce of suitable shipping condition to make good arrival at the agreed contract location . . . .” Ans. and Counterclaim at 8, D.E. 17. Arvila also claims that Boyette Brothers failed to pay commissions that were due to it as a result of the 28 shipments. Id. ¶ 164.

         As part of its written discovery requests, Arvila sought documents and information related to Boyette Brothers' interaction with its contract growers and produce suppliers. Boyette Brothers objected to a number of the requests on the grounds that the information sought was not relevant, not proportional to the needs of the case, unduly burdensome to obtain, and sought commercially sensitive business information.

         After the parties engaged in unsuccessful discussions to address Boyette Brothers' objections, Arvila served a subpoena on 11 produce companies in eastern North Carolina seeking documents related to the sales, shipment, or delivery of produce to Boyette Brothers or Rock Ridge Farms Partnership from November 1, 2014 through June 30, 2015. Boyette Brothers seeks to quash the subpoenas on the grounds that they seek information that is irrelevant, not proportional to the needs of the case, and commercially sensitive. Arvila both rejects Boyette Brothers' contentions about the subpoena and claims that Boyette Brothers does not have standing to challenge the subpoena.

         The court held a hearing on this motion on April 5, 2017. At the conclusion of the hearing, the court required the parties to meet and confer again, as the disputes seemed resolvable without court intervention. The parties were unable to resolve their differences.

         II. Discussion

         A. Motion for Protective Order

         1. Background

         The Federal Rules of Civil Procedure authorize parties to “obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case . . . .” Fed.R.Civ.P. 26(b)(1). But despite the broad scope of discovery, a “court may, for good cause, issue an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense . . . .” Fed.R.Civ.P. 26(c)(1). A protective order may forbid certain kinds of discovery, set specific terms governing discovery, or limit the scope of matters that may be inquired into. Id. Boyette Brothers, as the party seeking the protective order, bears the burden of showing why it is entitled to the order. Martin v. Bimbo Foods Bakers Distribution, LLC, 313 F.R.D. 1, 6 (E.D. N.C. 2016).

         2. Request for Commercially Sensitive Information

         Boyette Brothers repeatedly objects to Arvila's discovery requests on the grounds that the requests seek commercially sensitive information. The Federal Rules provide that “[t]he court may, for good cause, issue an order . . . requiring that a trade secret or other confidential research, development, or commercial information not be revealed or be revealed only in a specified way[.]” Fed.R.Civ.P. 26(c)(1)(G). The party seeking the protective order bears the initial burden of showing “that the information sought is covered by the rule and that it will be harmed by disclosure.” In re Wilson, 149 F.3d 249, 252 (4th Cir. 1998) (citing 8 Charles Alan Wright & Richard L. Marcus, Federal Practice and Procedure § 2043, at 555-57 (2d ed. 1994)). If the moving party satisfies its initial burden, the party seeking discovery “then must establish that the information is sufficiently necessary and relevant to his case to outweigh the harm of disclosure.” Id.

         Here, Boyette Brothers has submitted an affidavit from Robert Boyette, the President of Boyette Brothers discussing the confidential nature of the materials sought by Arvila. Boyette Aff ¶ 1, D.E. 35-2. The affidavit establishes that Boyette Brothers keeps the requested documents and information confidential in its day-to-day business operations and that disclosure would have an adverse impact on its commercial operations. Id. ¶ 3. But, as the court will discuss in the following sections, Arvila has sufficiently established that the information is necessary and relevant to the claims and defenses at issue in this case to justify disclosure. To mitigate the potential harm to Boyette Brothers' commercial interests, the court will enter a separate protective order that allows the parties to designate documents and information as either confidential or for attorney eyes only.

         3. Relevance of Produce Quality

         The Federal Rules limit discovery to “any nonprivileged matter that is relevant to any party's claim or defense . . . .” Fed.R.Civ.P. 26(b)(1). A matter is relevant if it has “any tendency to make a fact more or less probable than it would be without the evidence” and “the fact is of consequence in determining the action.” Fed. R. Evid. 401. When applying the discovery rules, ...

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