Motorola Sols., Inc v. Hytera Comms. Corp.

In this trade secret theft case, the magistrate denied the plaintiff’s motion for a forensic inspection of the defendant’s computers. This ruling was a reversal of the magistrate’s earlier decision, which he deemed “a mistake.”

This case arose when the plaintiff, Motorola Solutions, Inc., charged Hytera Communications Corp. with stealing its intellectual property. However, Motorola did not file its claim until almost ten years after the alleged theft. Hytera moved for dismissal of the case for failure to file within the statute of limitations. Motorola argued that the limitations period should be tolled.

The district court stayed general discovery and granted a one-month period of discovery solely regarding the statute of limitations issue. That one-month window was scheduled to close on October 6, 2017 — more than seven months before the current opinion.

In the magistrate’s view, what should have been “uncomplicated” instead became “a long, drawn out, pitched battle” rivaling the Punic Wars. Starting in September, Motorola sought “a broad range of documents … going back nine years.” Hytera argued that this discovery exceeded the statute of limitations inquiry. The district court, perhaps reluctantly, allowed the discovery. This resulted in numerous motions to compel and “thousands of pages” of filings. In short, the magistrate concluded that “discovery ha[d] become more important than the actual case.”

Motorola’s current motion to compel sought a forensic examination of Hytera’s computers, which are located in China. That motion noted ominously that Motorola wanted to “begin with” the computers of seven named employees.

The magistrate previously considered that motion and “tentatively concluded” that forensic examination was appropriate. His ruling was conditioned on the parties creating a protocol that would not violate Chinese law.

Now, however, he determined that his earlier ruling “was a mistake.” Noting that “reconsideration is a valuable tool,” the magistrate stated that his “tentative inclination to allow [forensic examination] was in error.” Instead, the information that Motorola sought exceeded the limited scope of discovery regarding equitable tolling.

The magistrate specified that there were two problems with Motorola’s motion to compel.

First, Hytera’s computers had no apparent relevance to when Motorola could have discovered the theft. Motorola had indicated that it would rely on the doctrine of fraudulent concealment. The magistrate observed that nothing on Hytera’s internal systems would influence that determination. Indeed, as he said, “Motorola never had access to any of Hytera’s computers any more than it does now.” Hytera’s handling of internal files was not “relevant to the narrow issue” of when Motorola knew enough to initiate suit.

In a footnote, the magistrate drew an analogy to the theft of a painting and its replacement by a forgery. Clearly, whether the thief conceals the original in his own home has no bearing on when the victim discovers the theft. Similarly, whatever Hytera discussed internally would not “move th[e] meter” on deciding when Motorola became aware of any misconduct.

Tellingly, Motorola had also noted that it was prepared to proceed with the motion regarding the statute of limitations. This readiness further belied its argument that it needed additional discovery regarding any tolling of that period.

Second, the magistrate concluded that forensic examination was disproportionate to the needs of the case, specifically the equitable tolling argument. The magistrate considered the proportionality factors in Federal Rule of Civil Procedure 26(b)(1). Here, “the burden and expense of the proposed discovery manifestly outweighs its likely benefit” to the narrow issue at hand.

The magistrate observed that Motorola had already received 700,000 documents totaling nearly 3 million pages. Again in a footnote, the magistrate colorfully explained that this volume of discovery would stand nearly 100 stories high.

Plainly, he concluded, “things have already gone far beyond what was intended [or] necessary.” And “Motorola wants things to go very much further” with extensive forensic examinations. With their potential to invade privacy, forensic examinations are a “drastic step” even during general discovery.

The magistrate concluded, “The time has come to say: ‘enough is enough.’” He denied Motorola’s motion for forensic examination.

Takeaways on Evaluating Relevance

This opinion highlights the extent to which relevance depends on what issues are in dispute. To get the most from ediscovery, you must clearly and completely understand the disputed issues and their component elements, as well as how your data relates to them. Be sure to evaluate whether each specific portion of discovery “moves the meter” on establishing or disproving a disputed element. Additionally, while it’s rare for a court to change its opinion on reconsideration, an unprompted reconsideration is rarer yet. If you find yourself with a ruling where you believe the court got it exceptionally wrong, it may be worth seeking reconsideration.

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