Sprint Nextel Corporation v. Ace Wholesale, INC
2:14-cv-02119
D. Nev.Jun 10, 2015Background
- Sprint sued multiple defendants for an alleged scheme: bulk purchase/resale of Sprint phones, theft of subsidies, unauthorized access to Sprint systems, trafficking of passwords, and trademark infringement.
- Defendants either asserted the Fifth Amendment or defaulted, so Sprint pursued third‑party discovery from seven foreign/outsourced vendors who transacted with defendants.
- Sprint served Rule 45 subpoenas (documents and Rule 30(b)(6) depositions) personally on the third parties in Las Vegas, within 100 miles of compliance locations.
- None of the third parties responded, objected, or produced documents; Sprint moved to compel and for fees.
- The court found the subpoenas complied with Rule 45, the requests sought discoverable, relevant information about defendants’ dealings, and the third parties waived objections by not responding.
- The court granted the motion to compel compliance, denied the fee request without prejudice (leave to amend), scheduled a show‑cause hearing, and ordered third parties to bring responsive documents to the hearing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Validity and service of Rule 45 subpoenas | Subpoenas issued from the proper court and were personally served in Las Vegas; compliance locations within 100 miles | (No response; no objection) | Subpoenas valid and properly served; compliance ordered |
| Scope and relevance of requested documents/depositions | Requests are reasonably calculated to lead to admissible evidence about defendants’ trafficking, co‑conspirators, and methods | (No response; no objection) | Requests are within Rule 26/45 scope and discoverable; production and depositions ordered |
| Waiver of objections by nonresponse | Third parties failed to object within Rule 45/Local Rule deadlines; waiver results | (No response) | Third parties waived any objections by failing to respond; motion granted |
| Entitlement to attorney's fees and costs under Rule 37 | Fees mandated when motion is granted; Sprint seeks expenses for bringing motion | (No response) | Court denied fees at this time (discretionary), but permitted Sprint to seek reimbursement after ancillary proceedings; left open with leave to amend |
Key Cases Cited
- Seattle Times Co. v. Rhinehart, 467 U.S. 20 (1984) (discovery rules permit broad, liberal discovery to aid truth‑finding)
- Shoen v. Shoen, 5 F.3d 1289 (9th Cir. 1993) (liberal discovery promotes fairness and truth in litigation)
- Hickman v. Taylor, 329 U.S. 495 (1947) (discovery rules allow reasonable "fishing" for evidence)
- Brown Shoe Co. v. United States, 370 U.S. 294 (1962) (courts must balance fair resolution with avoiding undue cost)
- Blankenship v. Hearst Corp., 519 F.2d 418 (9th Cir. 1975) (resisting party bears heavy burden to justify discovery denial)
- Yeti by Molly, Ltd. v. Deckers Outdoor Corp., 259 F.3d 1101 (9th Cir. 2001) (district court has wide latitude in imposing Rule 37 sanctions)
- U.S. v. Richards, 892 F.2d 1047 (9th Cir. 1989) (corporate subpoena properly served on company principal)
- Beckman Indus., Inc. v. Int’l Ins. Co., 966 F.2d 470 (9th Cir. 1992) (generalized objections insufficient; must detail specific reasons)
- Hofer v. Mack Trucks, Inc., 981 F.2d 377 (8th Cir. 1992) (movant must show requested discovery is relevant under Rule 26)
- Oppenheimer Fund, Inc. v. Sanders, 437 U.S. 340 (1978) (relevance threshold for discovery under Rule 26)