Perfect 10 Google P10 Sanctions Motion - Typepad

Plaintiff Perfect 10 Inc.’s Opposition To Defendant Google Inc.'s Ex Parte Application To Enforce The Court’s October 6, 2009 Order and Request For Sanctions Against Google and Quinn Emanuel

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Jeffrey N. Mausner (State Bar No. 122385) [email protected] David N. Schultz (State Bar No. 123094) [email protected] Law Offices of Jeffrey N. Mausner 6222 Amigo Ave. Tarzana, CA 91335 Telephone: (310) 617-8100 Facsimile: (310) 476-8138 Attorneys for Plaintiff Perfect 10, Inc.

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

PERFECT 10, INC., a California corporation, Plaintiff, v. GOOGLE INC., a corporation, Defendants.

Case No. CV 04-9484 AHM (SHx) Discovery Motion Which Should Be Before Magistrate Judge Hillman, But Which Has Been Improperly Noticed By Google Before Judge Matz PLAINTIFF PERFECT 10 INC.’S OPPOSITION TO DEFENDANT GOOGLE INC.'S EX PARTE APPLICATION TO ENFORCE THE COURT’S OCTOBER 6, 2009 ORDER AND OSC RE SANCTIONS; REQUEST FOR SANCTIONS AGAINST GOOGLE INC. AND QUINN EMANUEL URQUHART & SULLIVAN, LLP Date: February 13, 2012 Time: 2:00 P.M. Place: Courtroom 14 Discovery Cut-Off Date: May 1, 2012 Pretrial Conference Date: January 14, 2013

Trial Date: January 28, 2013

Case 2:04-cv-09484-AHM-SH Document 1094 Filed 02/13/12 Page 1 of 15 Page ID #:25797

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- 1 -Plaintiff Perfect 10 Inc.’s Opposition To Defendant Google Inc.'s Ex Parte Application To Enforce The

Court’s October 6, 2009 Order and Request For Sanctions Against Google and Quinn Emanuel

Google’s Ex Parte Application Regarding the Bruce Hersh Documents should

be denied, for two reasons:

1. It is procedurally improper.

2. It is completely groundless.

1. Google’s Ex Parte Application Is Procedurally Improper.

Google electronically filed its ex parte application on Sunday, February 12,

2012, at 2:30 P.M., purportedly setting a hearing before Judge Matz at 2 P.M. on

Monday, February 13, 2012. Such notice is procedurally improper, for three

separate reasons. First, Google provided insufficient time for Perfect 10 to prepare

its response – less than 24 hours before the time set for hearing. Second, Google

improperly set its ex parte application for a hearing. Third, Google improperly set

its ex parte application before Judge Matz rather than Magistrate Judge Hillman,

even though it involves a discovery matter and a previous order of Magistrate Judge

Hillman. Furthermore, Google’s email informing Perfect 10 that Google was

planning to file an ex parte application was sent on Friday, February 10 at 11:59

P.M. This email did not even identify what was supposedly wrong with the

voluminous document production of financial documents that Perfect 10 has made

over a two-year period. As set forth below, Perfect 10 has completely complied

with Magistrate Judge Hillman’s October 6, 2009 Order to produce documents (the

“Order”).

Furthermore, Google is well aware that a hearing on an important motion is

scheduled before Judge Matz, just one hour later, at 3 P.M. on Monday, February

13, 2012. In short, this ex parte application is simply a very transparent effort by

Google to interfere with Perfect 10’s preparation for that hearing.

Google and its attorneys, the firm of Quinn Emanuel Urquhart & Sullivan

(“Quinn Emanuel”), should be sanctioned for this improper ex parte application.

Google’s attorneys, Quinn Emanuel, regularly engage in this type of overly

aggressive, abusive discovery practice. See, e.g., Mattel Inc. v. Walking Mountain


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Productions, 353 F.3d 792, 813-14 (9th Cir. 2003), in which Quinn Emanuel,

including Michael Zeller, who is also lead counsel for Google in this case, were

sanctioned for abusive discovery and “unwarranted oppressive tactics,” consisting of

filing an ex parte application for improper discovery. The Ninth Circuit affirmed the

District Court’s finding that Quinn Emanuel and Mr. Zeller had served discovery

“for the purpose of annoying and harassment and not really for the purpose of

getting information.” Id at 813-814. See also Exhibit 1.

Less than one month ago, Google filed a similar ex parte application in front

of Judge Matz, seeking an expedited hearing. Judge Matz outright denied the ex

parte application, finding that: “If necessary, date scheduled for 30(b)(6)

depo[sition] can be advanced. Regular briefing schedule necessary.” Order

Denying Ex Parte Application, January 17, 2012, Docket No. 1070. Despite this

Court’s prior rejection of Google’s attempts to use such abusive tactics there,

Google apparently thought it would try again. This Court should make clear that it

will not allow such abusive tactics and gross violation of the Local Rules.

Local Rule 37-3 provides: “[N]o discovery motions shall be filed or heard on

an ex parte basis, absent a showing of irreparable injury or prejudice not attributable

to the lack of diligence of the moving party.” There is no emergency here; this is

just another example of Google’s frequent abuse of ex parte applications.

This is a perfect case for Quinn Emanuel to engage in the kind of abusive

conduct that it is well known for, because it has a client with unlimited resources,

and it is up against a much smaller party with very limited resources. This Court

should not allow this type of bullying and abusive conduct against smaller parties.

Instead, this Court should impose sanctions against Google and Quinn Emanuel.

2. Google’s Ex Parte Application Is Meritless.

Judge Hillman’s October 6, 2009 Order provides:

1. Perfect 10 is ordered to produce copies of all of its periodic and annual financial statements and tax returns to the extent such documents exist, including those in the possession of its outside


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accountant Bruce Hersh, in complete and unredacted form, with the following two exceptions:

a. With respect to medical expenses, the names of patients and treating physicians may be redacted;

b. With respect to credit card expenses, Perfect 10's credit card numbers may be redacted.

Perfect 10 must produce such documents in complete and unredacted form (with the two exceptions noted above) by October 16, 2009.

2. Settlement payments Perfect 10 has received from third parties are relevant for discovery purposes. This Court is not ruling on whether this information is relevant for any other purpose. Perfect 10 may not redact information regarding the date, payor, and amount of any such settlement payments. This information will be treated as “HIGHLY CONFIDENTIAL” under the terms of the Protective Order. Perfect 10’s compliance with the Order is stayed for ten (10) days from the hearing date, September 22, 2009. By producing such settlement payment information pursuant to this Order, neither Perfect 10 nor its counsel will be in violation of any protective orders or confidentiality provisions entered into in this action or in any other action, or with any of the settling third-parties. Perfect 10 is not required to produce any information about any settlements with third-parties, other than the date, payor, and amount of any such settlement payments, and may redact the settlement information it is not required to produce.

3. Defendants’ request for all source documents Mr. Hersh relied on to prepare the financial statements and allocate expenses and income is granted in part, as follows:

a. At least ten (10) calendar days prior to the agreed upon deposition date of its accountant Bruce Hersh, Perfect 10 shall produce to all Defendants copies of all source documents reasonably available to Mr. Hersh which he and P10’s counsel reasonably expect to refer to in order to prepare for his deposition, in order to give meaningful testimony concerning Perfect 10's financial condition. Such documents shall include P10’s financial statements and tax returns.

b. Mr. Hersh's deposition will proceed as follows: Defendants may depose Mr. Hersh up to one and one-half consecutive days (not to exceed 10.5 hours of testimony), after which the parties shall meet and confer regarding whether it is necessary for Mr. Hersh to produce any additional source documents that Mr. Hersh did not already produce, if any, and/or further questioning of Mr. Hersh. If the parties are unable to agree regarding the scope of or need for any further production and/or the necessity of obtaining further testimony from Mr. Hersh, the Court shall conduct a further hearing to decide that dispute. [Emphasis added.]

Perfect 10 has completely complied with the Order, and has repeatedly

advised Google that it has and will comply with the Order. Nevertheless, Google


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claims that Perfect 10 has to produce financial statements that were not created by

Perfect 10’s accountant, even though the Court’s Order specifically provides that

Perfect 10 only has to produce “financial statements and tax returns to the extent

such documents exist.”1 (emphasis added). At the hearing, Perfect 10 will provide

to the Court all of the existent financial statements and tax returns, which it has

produced to Google, consisting of 2,990 pages.2 There are no other documents to be

produced pursuant to the Order.

In regard to the source documents, Google completely mischaracterizes the

Court’s order. Google claims that the Order provides that Perfect 10 must produce

“the source materials upon which Mr. Hersh must have relied on in preparing the

financial statements.” Ex Parte Application, 5:16-18. That is not what the Order

says, and Judge Hillman specifically rejected such language, because it would have

been tremendously burdensome, largely irrelevant, and unnecessary. Rather, Judge

Hillman specifically ordered that: “At least ten (10) calendar days prior to the agreed

upon deposition date of its accountant Bruce Hersh, Perfect 10 shall produce to all

Defendants copies of all source documents reasonably available to Mr. Hersh which

he and P10’s counsel reasonably expect to refer to in order to prepare for his

deposition.” Mr. Hersh does not have to refer to any of the source documents to

prepare for the deposition, because everything he needs is contained in the detailed

financial statements, consisting of 2,990 pages, that Perfect 10 has produced to

Google.

1 Google has not cited to any requirement, in the Corporations Code or otherwise, that Perfect 10 must create financial statements every month. Google has repeatedly been advised that it has received all existing financial statements. Google is simply bringing this ex parte application to harass Perfect 10, at a time when it knows Perfect 10 is busy on other matters. 2 Perfect 10 will provide the documents to the Court on a memory stick, since it would be wasteful and time consuming to print 2,990 pages in paper format. Perfect 10 requests that the Court have a computer available to view the memory stick.


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Accordingly, for all of the above reasons, this Court should deny this

completely unnecessary, abusive, and procedurally untimely and improper ex parte

application and impose sanctions against both Google and Quinn Emanuel for

bringing it.

Dated: February 13, 2012 Respectfully submitted, Law Offices of Jeffrey N. Mausner By: __________________________________

Jeffrey N. Mausner David N. Schultz Attorneys for Plaintiff Perfect 10, Inc.

Jeffrey N. Mausner


EXHIBIT 1


Case 2:04-cv-09484-AHM-SH Document 419 Filed 05/17/2009 Page 17 of 50Case 2:04-cv-09484-AHM-SH Document 1094 Filed 02/13/12 Page 8 of 15 Page ID #:25804

1 The ex parte Application of MatteI, Inc. to Enforce Subpoena and To Compel The San

2 Francisco Museum of Modem Art to Produce Documents and to Produce Documents and to

3 Produce its Representative for Deposition ("Application") was filed on May 30, 2001. The

4 San Francisco Museum of Modem Art ("SFMOMA") filed an Opposition to the Application

5 on the morning of June 4, 2001. The Court held a telephone hearing on the Application on

6 June 4,2001, at 12:00 p.m. Michael T. Zeller of Quinn Emanuel Urquhart Oliver & Hedges

7 appeared for MatteI. Simon J. Frankel of Howard, Rice, Nemerovski, Canady, Falk &

8 Rabkin, A Professional Corporation, appeared for SFMOMA.

9 Having considered the Application and SFMOMA's Opposition and the argument of

10 counsel, the Court finds that the subpoena served by MatteI on SFMOMA on May 15,2001

11 (the "Subpoena") was not served for a legitimate purpose, but for annoyance and

12 harassment; that the Subpoena imposes an undue burden on SFMOMA, a non-party to the

HOI\W\D 13 underlying action, Mattel, Inc. v. Walking Mountain Productions, et al., C.D. Cal. No. 99-RK:E

~G 14 08543 RSWL (RZx) (the "Action"); that MatteI's counsel has engaged in misconduct inWK

&RABI<JN

__ 15 serving and seeking to enforce the Subpoena, in failing to meet and confer before filing the

16 Application, and in engaging in a pattern of serving museums whose employee is a witness

17 in the Action with a broad subpoena for no legitimate reason; and that the United States

18 District Court for the Central District of California, where the Action is pending, should be

19 notified of this Court's finding ofmisconduct.

20 Accordingly, the Court hereby ORDERS that:

21 1. The Application is denied;

22 2. The SUbpoena is quashed in its entirety;

23 3. MatteI's counsel is hereby sanctioned for serving and seeking to enforce an

24 improper subpoena and for failing to meet and confer and is therefore ordered to pay

25 SFMOMA's counsel, Howard, Rice, Nemerovski, Canady, Falk & Rabkin, a total of

26 $9,616.93 for the fees and costs incurred in opposing the Application, to be paid within ten

27 days of the date of this Order;

28 4. Counsel for SFMOMA is directed to inform the United States District Court for

[Proposed] ORDER-1-

C01-0091 Misc. WHA


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The Court is clear that MatteI's misconduct cried out for a sanction and was a clear

declaration. All objections to the amount are overruled.

violation of its duty under FRCP 45(c)(1) to avoid "undue burden" and was served for an

improper purpose within the meaning ofFRCP 26(g). The award of attorney's fees was fully

warranted. MatteI was in no way prejudiced by not holding a supplemental hearing. The abuse

of discovery by MatteI was manifest.

MatteI's new three-inch stack of paperwork is more of the same. MatteI and its law firm

of Quinn, Emanuel, Urquhart, Oliver & Hedges, LLP are engaging in unwarranted oppressive

tactics. To bring this matter to a close or at least an appeal, the Court will rather simply order

MatteI and its counsel to pay SFMOMA the $9,616.93 documented fully in the Winthrop

WILLIAM ALSUPUNITED STATES DISTRICT JUDGE

IT IS SO ORDERED.

Dated: July 6, 2001.

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