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EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN JOSE DIVISION
EBAY INC.,
Plaintiff,
v.
DIGITAL POINT SOLUTIONS, INC.,
SHAWN HOGAN, KESSLER’S
FLYING CIRCUS, THUNDERWOOD
HOLDINGS, INC., TODD DUNNING,
DUNNING ENTERPRISE, INC., BRIAN
DUNNING, BRIANDUNNING.COM,
and DOES 1-20,
Defendants.
Case No. C 08-04052 JF PVT
EBAY INC.’S NOTICE OF MOTION
AND MOTION TO COMPEL
RESPONSES TO REQUESTS FOR
PRODUCTION,
INTERROGATORIES AND
REQUESTS FOR ADMISSION
FROM DIGITAL POINT
SOLUTIONS, INC. AND SHAWN
HOGAN; MEMORANDUM OF
POINTS AND AUTHORITIES IN
SUPPORT THEREOF
Hearing Date: November 3, 2009
Time: 10:00 a.m.
Judge: Hon. Patricia V. Trumbull
DAVID R. EBERHART (S.B. #195474)
deberhart@omm.com
SHARON M. BUNZEL (S.B. #181609)
sbunzel@omm.com
COLLEEN M. KENNEDY (S.B. #227107)
ckennedy@omm.com
O’MELVENY & MYERS LLP
Two Embarcadero Center, 28th Floor
San Francisco, CA 94111
Telephone: (415) 984-8700
Facsimile: (415) 984-8701
Attorneys for Plaintiff eBay Inc.
Case5:08-cv-04052-JF Document128 Filed09/29/09 Page1 of 18
eBay Inc. v. Digital Point Solutions, Inc. et al Doc. 128
Dockets.Justia.com
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1 EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
NOTICE OF MOTION AND MOTION
PLEASE TAKE NOTICE THAT, on November 3, 2009, at 10:00 a.m., or as soon
thereafter as the matter may be heard, in Courtroom 5 of the United States District Court
for the Northern District of California, San Jose Division, located at 280 South 1st St., San
Jose, California, 95113, eBay Inc. will and hereby does move for an order that:
1. Defendant Shawn Hogan, notwithstanding his continuing invocation of his Fifth
Amendment right, produce all documents responsive to eBay’s First and
Second Set of Requests for Production that were previously obtained by the
FBI, including but not limited to any such documents that may be within his
control at third party NetHere, Inc.;
2. Defendant Digital Point Solutions, Inc. conduct a diligent search for and
produce all documents responsive to eBay’s First and Second Set of Requests
for Production, including by exercising any and all rights that it may have to
obtain documents from third party NetHere, Inc.; and
3. Defendant Digital Point Solutions, Inc.’s objections to eBay’s Interrogatories
and certain of eBay’s Requests for Admission and Requests for Production on
the grounds that the definition of “DPS” is overbroad, unduly burdensome and
oppressive be stricken and Digital Point Solutions, Inc. provide supplemental
responses to those requests that include information regarding “DPS” as defined
by eBay.
eBay’s Motion is made pursuant to Federal Rule of Civil Procedure 37(a)(3)(B),
and seeks an order compelling substantive responses to eBay’s Requests for Production,
Interrogatories and Requests for Admission as required by Federal Rules of Civil
Procedure 34(b)(2), 33(b) and 36(a), respectively. See Declaration of Colleen M.
Kennedy in Support of eBay Inc.’s Motion to Compel (“Kennedy Decl.”).1
1 A comprehensive list of eBay’s discovery requests addressed in this Motion and Defendants’
responses to those requests is set forth in an exhibit to the attached Kennedy Declaration. See
Kennedy Decl., Ex. 1.
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2 EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
The motion is based on this notice, the attached memorandum of points and
authorities, all supporting declarations, the pleadings and other records on file with the
Court, the oral argument of counsel, all relevant matters judicially noticeable, and such
further evidence and arguments as the Court may consider.
DATED: September 29, 2009 DAVID R. EBERHART
SHARON M. BUNZEL
COLLEEN M. KENNEDY
O’MELVENY & MYERS LLP
By: /s/ David R. Eberhart
DAVID R. EBERHART
Attorneys for Plaintiff eBAY INC.
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TABLE OF CONTENTS
Page
i EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
I. INTRODUCTION.................................................................................................... 1
II. SUMMARY OF RELEVANT FACTS.................................................................... 2
III. ARGUMENT ........................................................................................................... 2
A. Mr. Hogan Must Produce The Materials He Previously Provided To
The FBI.......................................................................................................... 2
B. DPS, Inc. Has Access To Responsive Documents That Must Be
Produced........................................................................................................ 5
C. DPS, Inc. Cannot Limit Its Discovery Responses Based On Mr.
Hogan’s Fifth Amendment Privilege ............................................................ 8
1. Requests For Admission .................................................................. 10
2. Requests For Production .................................................................. 11
3. Interrogatories .................................................................................. 11
IV. CONCLUSION ...................................................................................................... 12
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TABLE OF AUTHORITIES
Page
ii EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
CASES
Fed. Sav. & Loan Ins. Corp. v. Rodrigues,
717 F. Supp. 1424 (N.D. Cal. 1998) .............................................................................. 3
Fisher v. United States,
425 U.S. 391 (1976)................................................................................................... 3, 4
Henry v. Sneiders,
490 F.2d 315 (9th Cir. 1974) ......................................................................................... 4
In re Grand Jury Proceedings,
759 F.2d 1418 (9th Cir. 1985) ....................................................................................... 3
In re Grand Jury Subpoena Duces Tecum Dated Oct. 29, 1992,
1 F.3d 87 (2d Cir. 1993)............................................................................................. 3, 4
Martin-Trigona v. Gouletas,
634 F.2d 354 (7th Cir. 1980) ......................................................................................... 5
Thomas v. Tyler,
841 F. Supp. 1119 (D. Kan. 1993)................................................................................. 4
United States v. Clark,
847 F.2d 1467 (10th Cir. 1988) ..................................................................................... 4
United States v. Edgerton,
734 F.2d 913 (2d Cir. 1984)........................................................................................... 5
United States v. Harrington,
923 F.2d 1371 (9th Cir. 1991) ....................................................................................... 4
United States v. Rue,
819 F.2d 1488 (8th Cir. 1987) ....................................................................................... 4
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1 EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
MEMORANDUM OF POINTS AND AUTHORITIES
I. INTRODUCTION
eBay seeks an order compelling Digital Point Solutions, Inc. (“DPS, Inc.”) and its
owner Shawn Hogan (collectively, “Defendants”) to provide documents and proper
written discovery responses. Defendants have improperly refused to produce documents
to eBay in two different ways. First, Shawn Hogan has improperly refused to produce
materials that were previously obtained from him by the government. Although an act of
production may be incriminating under some circumstances, it is not incriminating under
the facts presented here: the existence and location of the materials is known to the
government, and the government can independently authenticate those materials.
Consequently, Mr. Hogan’s Fifth Amendment rights cannot preclude production.
Second, DPS, Inc. has refused to produce responsive documents by claiming it has
none or virtually none within its possession, custody or control. This cannot be true.
DPS, Inc. was incorporated during the period of the wrongdoing and, during that same
period, took ownership of valuable servers from Mr. Hogan that were likely used in the
fraud. Further, third party NetHere—a company that has provided co-location services for
servers owned by Defendants from 1996 to the present—possesses multiple servers that
are within the control of one or more of the Defendants.
In addition, DPS, Inc. has refused to provide the full extent of the discovery sought
by eBay based on the contention that the broad definition of “DPS” in eBay’s requests
implicates Shawn Hogan’s Fifth Amendment rights against self-incrimination. But DPS,
Inc. has fundamentally confused the scope of the requests with the party responding to the
requests. eBay is fully entitled to obtain information regarding, among others, Mr. Hogan
from DPS, Inc., and DPS, Inc. may not hide behind Mr. Hogan’s Fifth Amendment
privilege to avoid responding to such discovery.
Defendants have improperly withheld all meaningful discovery from eBay and the
Court should compel compliance with eBay’s discovery requests.
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2 EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
II. SUMMARY OF RELEVANT FACTS
Defendants are an individual and a corporation that misused eBay’s computer
systems and defrauded eBay through its affiliate marketing program. Defendants’ “cookie
stuffing” scheme was identical in all relevant respects to the scheme described in detail in
eBay’s motion to compel discovery responses from the remaining defendants (filed on
September 22, 2009), and that description is incorporated herein by reference.
eBay has diligently attempted to resolve its discovery disputes with Defendants
without the need for court intervention, through both correspondence and two telephonic
meet and confer discussions on August 27 and September 18, 2009. Kennedy Decl., ¶ 2.
Through these efforts, eBay has obtained (i) an acknowledgment from DPS, Inc. that it
does not possess a Fifth Amendment privilege to avoid responding to discovery and
(ii) certain supplemental responses from DPS, Inc. to eBay’s interrogatories, requests for
admission and first set of requests for production. See Kennedy Decl., Exs. 2-4. But the
supplemental responses not only fail to resolve significant defects in Defendants’
discovery positions, those responses provide compelling evidence of the remaining
defects.
III. ARGUMENT
A. Mr. Hogan Must Produce The Materials He Previously Provided To
The FBI
Shawn Hogan cannot legitimately invoke the Fifth Amendment privilege to
withhold from production to eBay any documents already in the hands of the
government.2 It is undisputed that Mr. Hogan possesses responsive materials that were
provided to the federal government in the course of its criminal investigation of
Defendants’ cookie stuffing schemes. See, e.g., Kennedy Decl., Ex. 5, at 2 (“The Federal
Bureau of Investigation has seized documents and materials potentially related to the
present action. As of the date of these responses, the FBI has not returned all of the seized
2 The 32 specific document requests to which eBay moves to compel responses in this section are
set forth in the Kennedy Declaration, at ¶ 4.
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3 EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
materials to Defendant, some of which may be responsive to Plaintiff’s requests
hereunder.”). Although some responsive material may still be in the government’s hands,
Defendants concede that they currently possess the vast majority of the materials
previously obtained by the government, with the possible exception of some physical
documents. Kennedy Decl., Ex. 6, at 13 (“[I]t appears that all computer-related materials
have been returned by the FBI. However, the scope of the seizure is not entirely clear and
it appears that some physical documents are still in the possession of the FBI and/or the
U.S. Attorney’s Office.”).
The privilege against self-incrimination applies only to testimony; therefore, the
contents of voluntarily prepared documents, whether business or personal, are not
generally protected by the Fifth Amendment. In re Grand Jury Proceedings, 759 F.2d
1418, 1419 (9th Cir. 1985). Although in limited instances the act of producing voluntarily
created documents may implicate the Fifth Amendment, id. at 1420, such circumstances
are not present here. This “act of production” privilege only applies if the act of
producing the documents is compelled, testimonial and incriminating. Fed. Sav. & Loan
Ins. Corp. v. Rodrigues, 717 F. Supp. 1424, 1425 (N.D. Cal. 1998). The production of
responsive documents to eBay would not be “testimonial and incriminating.”
To determine whether the act of production is testimonial and incriminating,
federal courts generally consider two factors. First, they look to whether “the existence
and location of the [requested] papers are unknown to the government.” In re Grand Jury
Subpoena Duces Tecum Dated Oct. 29, 1992, 1 F.3d 87, 93 (2d Cir. 1993). If “the
existence and location of the papers are a foregone conclusion” based on information
already known to the government, then the act of producing the documents does not
implicate the privilege. Fisher v. United States, 425 U.S. 391, 411 (1976) (holding that
the Fifth Amendment is not applicable to the production of documents where the
production “adds little or nothing to the sum total of the Government’s information”).
Because Mr. Hogan concedes that the government already possesses the documents
here at issue, the communicative aspects of the production regarding the “existence and
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4 EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
location” of the documents cannot be further incriminating to him. See In re Grand Jury
Subpoena Duces Tecum, 1 F.3d at 93 (where the government already has a copy of the
requested document, the subsequent production of the original document “adds little or
nothing to the sum total of the Government’s information”); Henry v. Sneiders, 490 F.2d
315, 317 (9th Cir. 1974) (“[E]ven if the records were incriminating, their disclosure in the
civil case would not have tended to incriminate the defendant. Any incriminating
evidence was already in the hands of the prosecuting authorities.”). Because a document
production in this action would add little, if anything, to the government’s quantum of
knowledge, its testimonial value is therefore negligible. Fisher, 425 U.S. at 411; see also
United States v. Clark, 847 F.2d 1467, 1472-73 (10th Cir. 1988) (declining to apply the
act of production privilege where the government already has extensive knowledge and
information regarding the requested documents).
Second, the act of producing documents is not incriminating when the government
“can independently authenticate the [documents] without using [the party’s] act of
producing the [documents] as evidence of their authenticity.” United States v. Rue, 819
F.2d 1488, 1494 (8th Cir. 1987). If the government can do so, then authentication of the
documents is a foregone conclusion that does not sufficiently implicate the right against
self-incrimination. Id.; see also In re Grand Jury Subpoena Duces Tecum, 1 F.3d at 93
(where the government already possesses the document and can provide alternative means
of authentication, no Fifth Amendment privilege applies to a subsequent production).
Here, the government has an independent means of authentication: documents obtained
from Mr. Hogan may be authenticated by testimony that the documents are in
“substantially the same condition” as they were when originally obtained. See United
States v. Harrington, 923 F.2d 1371, 1374 (9th Cir. 1991). Therefore, the authentication
of the documents sought by eBay is a “foregone conclusion,” and the act of production is
not incriminating. See Thomas v. Tyler, 841 F. Supp. 1119, 1131 (D. Kan. 1993)
(ordering defendant to produce all documents that have already been delivered to a third
party because the third party can be relied upon by the government to show their
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5 EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
existence, possession and authenticity).
Mr. Hogan has suggested that the allegedly involuntary nature of the “seizure” of
his documents requires the application of the act of production doctrine. See Kennedy
Decl., Ex. 7. But he has not identified any case holding that the applicability of the act of
production doctrine turns on voluntariness of the prior production. Nor has Mr. Hogan
provided proof that the seizure was, in fact, involuntary—a question that simply cannot be
assumed. See United States v. Edgerton, 734 F.2d 913, 919 (2d Cir. 1984) (mere assertion
of privilege against self-incrimination is not sufficient to establish the hazard of
incrimination and thus warrant the exercise of a privilege). The law does not require that
the Court take Mr. Hogan’s word that the Fifth Amendment is applicable; the law requires
him to prove that providing the discovery would tend to incriminate him. See Martin-
Trigona v. Gouletas, 634 F.2d 354, 360 (7th Cir. 1980) (a witness’s “say-so does not of
itself establish the hazard of incrimination,” rather, the witness must “tender some
credible reason why a response would pose a real danger of incrimination”). Mr. Hogan
should therefore be compelled to produce all documents in his possession, custody or
control that have previously been obtained by the FBI.3
B. DPS, Inc. Has Access To Responsive Documents That Must Be
Produced
DPS, Inc. contends that its purportedly “late” incorporation—on May 14, 2007—
means that it “does not have any responsive documents or information within its
possession, custody or control because it never conducted business with [eBay] and was
never involved in [eBay]’s affiliate marketing program.” Kennedy Decl., Ex. 7. DPS,
Inc. further claims that any interaction with eBay was undertaken by Mr. Hogan and/or a
sole proprietorship called “Digital Point Solutions” that existed prior to DPS, Inc.’s
formation. Kennedy Decl. ¶ 3, Ex. 7. Because DPS, Inc.’s claim is untenable in at least
3 To the extent any documents previously obtained by the FBI are located on servers stored at
third party NetHere, Inc.—which are discussed in detail below—Mr. Hogan should be ordered to
exercise any control he may have over those documents and produce them as well.
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6 EBAY’S MOTION TO COMPEL CASE NO. C 08-4052 JF PVT
two ways, DPS Inc. should be ordered to produce the documents in its possession,
custody, or control.4
First, the evidence strongly suggests that DPS, Inc. participated in the fraud against
eBay’s affiliate marketing program, even if only for a month. It is undisputed that DPS,
Inc. existed from at least May 14, 2007 forward. See Kennedy Decl., Ex. 4, at DPS
000002-3. And eBay’s Second Amended Complaint (“SAC”) alleges that DPS, Inc.’s and
Mr. Hogan’s cookie stuffing scheme persisted through June 18, 2007. (See SAC ¶¶ 40,
48, 57.) Defendants concede this timeline (although they contest the substance of their
behavior): in motion practice, Defendants claimed that DPS, Inc. existed “from mid-May
to [at least] June 2007,” Kennedy Decl., Ex. 8, at 2-3, and that their participation in
eBay’s affiliate marketing program “terminated in June of 2007.” Kennedy Decl., Ex. 9,
at 11. Defendants’ statements in their motion to dismiss the SAC also impliedly concede
both DPS, Inc.’s participation in the affiliate marketing program and DPS, Inc.’s
ownership of the servers used in the fraud. Defendants stated, “Moreover, Defendants’
membership in the affiliate marketing program terminated in June of 2007, when Plaintiff
‘verif[ied]’ the existence of the purported scheme, ceased authorizing payouts for the
alleged unearned commissions (SAC ¶¶ 34, 52-56), and the FBI seized Defendants’
computers.” Id.
Documents produced last week by DPS, Inc., moreover, reveal that Mr. Hogan sold
computer servers worth $108,000 to DPS, Inc. on May 19, 2007—only five days after its
incorporation—in exchange for all of DPS, Inc.’s issued stock. Kennedy Decl., Ex. 4, at
DPS 000030, 000036, 000040. It strains credulity that Mr. Hogan would have chosen to
incorporate his “Digital Point Solutions” business using the same name, sold his valuable
servers to that corporation, and thereafter completely insulated that corporation from any
involvement in his (fraudulently) lucrative affiliate relationship with eBay.
4 The 64 specific document requests to which eBay moves to compel responses in this section are
set forth in the Kennedy Declaration, at ¶ 5. DPS, Inc. has produced 41 pages of documents in
connection with its supplemental responses to eBay’s first set of requests for production.
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Second, it is clear that, whatever it possesses, DPS, Inc. has failed to conduct a
diligent search for responsive documents during the eight months that eBay’s document
requests have been outstanding. DPS, Inc.’s document production on September 23, 2009
was the first time that eBay learned of DPS, Inc.’s ownership of the servers obtained from
Mr. Hogan in 2007. But DPS, Inc. has certainly known of those servers since 2007; yet,
when eBay inquired on September 24, 2009 whether those servers contained any
responsive material, counsel for DPS, Inc. responded: “It is my understanding that the
servers at issue have not been used, remain idle and do not contain any responsive
information. However, I will confer with Mr. Hogan upon his return [from an out-of-
town engagement] and will respond to your inquiry at that time.” Kennedy Decl., Ex. 10.
DPS, Inc. has long had a duty to search these servers, especially given that they were
transferred from Mr. Hogan during the period of the fraud. It is, moreover, simply not
credible that servers transferred at a valuation of $108,000 were never used.
Aside from documents currently in DPS, Inc.’s direct possession, it appears that
DPS, Inc. has access to and control over a substantial collection of records stored at third
party NetHere—a company that provides co-location services for servers owned by
Defendants. eBay subpoenaed NetHere in early June 2009. See Kennedy Decl., Ex. 11.
NetHere has stated that, although it provides services to Defendants, it has no access to
the documents sought by eBay and Defendants have exclusive access to and control over
their servers and the data on those servers stored at NetHere. Kennedy Decl., Exs. 12-13.
NetHere also indicated in its response to the subpoena that Defendants have been using
NetHere’s services since 1996, and are currently maintaining five different servers at
NetHere’s facility. Kennedy Decl., Ex. 12, at 2, 4. This raises a strong inference that the
servers stored at NetHere would contain documents relating to Defendants’ relationship
with eBay during the period of the fraud: 2003-2007. As part of its subpoena response,
NetHere also produced an invoice dated July 6, 2009, issued to “Digital Point Solutions,
Shawn Hogan.” Id. at 6. This invoice strongly suggests that both Mr. Hogan and DPS,
Inc. have control of the materials stored at NetHere. But DPS, Inc. has never exercised
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that control despite its obligation to produce documents to eBay.5
DPS, Inc. surely has documents in its possession, custody, or control that are
responsive to eBay’s requests for production. DPS, Inc. should be compelled to produce
all such documents, whether they exist on the servers sold to it by Mr. Hogan, at NetHere,
or otherwise.
C. DPS, Inc. Cannot Limit Its Discovery Responses Based On Mr. Hogan’s
Fifth Amendment Privilege
DPS, Inc. has also improperly refused to provide discovery to eBay on the
purported grounds of a Fifth Amendment privilege of Shawn Hogan and/or any purported
sole proprietorship that may have existed prior to DPS, Inc.’s formation.6 DPS, Inc. bases
this argument on a claim that the broad definition of “DPS” used by eBay implicates the
privilege of Mr. Hogan and those other entities because it “arguably seek[s] information
from Mr. Hogan individually.” Kennedy Decl., Ex. 7. But DPS, Inc.’s argument
fundamentally confuses the identity of the responding party with the subject matter of the
request.
There is a compelling reason for eBay’s broad definition of “DPS”—only
Mr. Hogan and DPS, Inc. know the details of their business organizations. eBay
understood that, during the relevant period, it was dealing with an entity called “Digital
Point Solutions” that was owned and controlled by Shawn Hogan. See SAC ¶ 47. But, as
discussed above, DPS, Inc. now contends that it was not involved in eBay’s affiliate
marketing program and that the “Digital Point Solutions” entity interacting with eBay
5 Nor has DPS, Inc. conducted a reasonable search for non-electronic materials. The Bylaws of
DPS, Inc.—also belatedly produced last week—indicate that DPS, Inc. was required to: (i) hold
annual meetings of the shareholders and board of directors and maintain minutes of all such
meetings, and (ii) file an Annual Statement of General Information. Kennedy Decl., Ex. 4, at
DPS 000007, 000015, 000020, 000024. When asked why DPS, Inc. had not produced all such
documents, counsel replied: “The fact that statements may be referenced in the bylaws does not
mean they were subsequently prepared or exist. . . . . However, I will confer with Mr. Hogan
further on this issue.” Kennedy Decl., Ex. 10. But DPS, Inc. was obliged to undertake that
search long ago.
6 The 23 requests for admission, 11 requests for production and 2 interrogatories to which eBay
moves to compel responses in this section are set forth in the Kennedy Declaration, at ¶ 6.
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from 2003 to 2007 was a sole proprietorship controlled by Mr. Hogan. See, e.g., Kennedy
Decl. ¶ 3, Ex. 7. Because Mr. Hogan and DPS, Inc. have the only direct knowledge of the
true nature of their organization(s) that dealt with eBay, eBay’s discovery requests to
DPS, Inc. define the term “DPS” broadly:
“DPS” shall mean Digital Point Solutions, Inc., and each of its
successor, predecessor, and related entities, including, without
limitation, its subsidiaries, parent corporations, divisions,
assigns, and any officers, directors, agents, employees,
representatives, attorneys, or other persons or entities acting
on its behalf, collectively, in any combination, or singly,
whichever is broader.
See, e.g., Kennedy Decl., Ex. 14, at 2. As with any defined term, the use of this definition
indicates that the party to whom the discovery requests are issued—here, DPS, Inc.—must
provide all responsive information in its possession regarding the entities and individuals
referenced in the definition. In other words, the definition of “DPS” describes the scope
of the information that DPS, Inc. must provide; it does not somehow redirect the requests
to Mr. Hogan or otherwise require him to incriminate himself.
But DPS, Inc. has refused to provide responses based on a tortured reading of this
definition that construes eBay’s discovery requests as seeking information directly from
Mr. Hogan. DPS, Inc.’s initial discovery responses asserted the Fifth Amendment
privilege on that basis. See Kennedy Decl., Exs. 15-17. And DPS, Inc.’s counsel
reiterated in meet and confer correspondence that “[T]he Fifth Amendment has been
appropriately asserted because the definitions of ‘DPS’ set forth in plaintiff’s discovery
requests are ambiguous and arguably seek information from Mr. Hogan individually.”
Kennedy Decl., Ex. 7.
Following a lengthy meet-and-confer process, DPS, Inc. finally agreed to serve
supplemental discovery responses that it claimed would provide the responsive
information in its possession. eBay, moreover, explicitly agreed that it would not contend
that DPS, Inc.’s service of proper responses somehow waived Mr. Hogan’s Fifth
Amendment rights. Kennedy Decl., Ex. 18. eBay received those supplemental responses
last week, but they are still improperly limited. The supplemental responses continue to
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assert the general objection that eBay’s definition of “DPS” is “overbroad, unduly
burdensome and oppressive in that it purports to apply to third parties collectively and/or
individually . . . and purports to seek responses from Mr. Hogan as phrased.” Kennedy
Decl., Exs. 2-4, at 2. And, more importantly, DPS, Inc. continues to improperly limit the
scope of its responses by refusing to provide information regarding any entity other than
DPS, Inc., as discussed below.
1. Requests For Admission
In response to eBay’s requests for admission, which asked DPS, Inc. to admit or
deny statements regarding “DPS’s” participation in eBay’s affiliate marketing program,
DPS, Inc. responded to all but two of those requests by restricting its responses to
information regarding only DPS, Inc. For example:
“Defendant denies that DIGITAL POINT SOLUTIONS, INC. conducted
business with Plaintiff at any time, and on that basis denies this request.”
“Defendant denies that DIGITAL POINT SOLUTIONS, INC. participated in
any eBay affiliate marketing programs, and on that basis denies this request.”
“Defendant denies that DIGITAL POINT SOLUTIONS, INC. received any
commissions from eBay at any time, and on that basis denies this request.”
Kennedy Decl., Ex. 3, at 3-10. But each of eBay’s requests for admission required that
DPS, Inc. provide admissions or denials with respect to the activities of any of the
entities/individuals defined as “DPS.”
While the responses are improper on their face, DPS, Inc. has also demonstrated
that it knows how to provide a proper response when it so chooses. In its responses to
requests for admission Nos. 24 and 25—which requested that DPS, Inc. admit or deny that
“DPS engaged in cookie stuffing with intent to defraud eBay” and that “DPS defrauded
eBay”—DPS, Inc. stated simply that “Defendant denies this request.” See id. at 11.
These responses demonstrate that DPS, Inc. is capable of accepting eBay’s definition of
“DPS” without compromising Mr. Hogan’s Fifth Amendment privilege when it pleases.
But the rules do not give DPS, Inc. such discretion, and it must provide complete
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responses to all of eBay’s requests for admission.
2. Requests For Production
DPS, Inc. has also improperly restricted its responses to many of eBay’s requests
for production. In response to requests for production No. 1-8, 13-14 and 23, DPS, Inc.
asserted that it has no responsive documents to produce, but only after making the
prefatory statement that “Defendant DIGITAL POINT SOLUTIONS, INC. never
conducted business with Plaintiff at any time.” See Kennedy Decl., Ex. 4, at 3-15. These
responses stand in marked contrast to DPS, Inc.’s supplemental responses to eBay’s other
requests for production, in which DPS, Inc. either agrees to produce documents (Nos. 26-
28), or states affirmatively that “[a] diligent search has been made in an effort to locate the
items requested (Nos. 9-12, 16-22, 24-25, 29).7 See id. at 7-18. This contrasting behavior
strongly suggests that DPS, Inc.’s statement that “Defendant DIGITAL POINT
SOLUTIONS, INC. never conducted business with” eBay means that DPS, Inc. is again
limiting its responses to those requests to documents regarding “DIGITAL POINT
SOLUTIONS, INC.” rather than to documents regarding eBay’s broader definition of
“DPS.”
DPS, Inc. may not withhold otherwise responsive documents in its possession
based on its contention that the production of any documents related to Mr. Hogan or his
business as it existed prior to DPS, Inc.’s incorporation is protected by Mr. Hogan’s Fifth
Amendment privilege. And again, DPS, Inc. made its qualifying statement in only some
of its responses to eBay’s requests for production, demonstrating that it is able to provide
proper responses to eBay’s requests when it suits its interests, and further undercutting the
basis for its improper refusal to accept eBay’s defined term.
3. Interrogatories
DPS, Inc. used a virtually identical qualifying statement in its supplemental
7 DPS, Inc. did not provide responses to requests for production No. 30, 31 and 32, which seek
documents relating to DPS, Inc.’s financial assets, financial statements and tax returns. eBay
continues to meet and confer with DPS, Inc. regarding these requests and will file a separate
motion to compel responses to those requests, if necessary.
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responses to eBay’s two interrogatories. When asked in interrogatory No. 1 to “[i]dentify
all persons or entities with knowledge regarding DPS’s participation . . . in any Affiliate
Marketing Program,” DPS, Inc. responded: “Defendant DIGITAL POINT SOLUTIONS,
INC. has never conducted any business of any kind with Plaintiff. Defendant otherwise
identifies the following persons and entities: Shawn Hogan and Google, Inc.” Similarly,
DPS, Inc. responded to interrogatory No. 2’s request that DPS, Inc. “[i]dentify all Internet
Forums at, within or through which DPS discussed any aspect of their participation in . . .
eBay’s Affiliate Marketing Program, or any other Affiliate Marketing Program,” by
stating: “Defendant DIGITAL POINT SOLUTIONS, INC. has never conducted any
business of any kind with Plaintiff. No such forums exist.” Kennedy Decl., Ex. 2, at 3.
Again, the use of the qualifying statement regarding DPS, Inc’s interaction with eBay
(putting aside its veracity) strongly suggests that DPS, Inc. has limited the content of its
responses by refusing to accept eBay’s definition of “DPS.”
If DPS, Inc. were not attempting to limit its responses, there would be no reason to
state that “Defendant DIGITAL POINT SOLUTIONS, INC.” never conducted business
with eBay. In response to interrogatory No. 2, for example, DPS, Inc. could have simply
stated “No such forums exist.” DPS, Inc. may not refuse to provide information in its
possession or control regarding Mr. Hogan’s business. To the extent it has not already
done so, DPS, Inc. must be compelled to provide all information in its possession or
control regarding the subject of eBay’s discovery responses, including eBay’s definition
of “DPS.”
IV. CONCLUSION
For the foregoing reasons, eBay respectfully requests that the Court issue an order
compelling discovery, as follows:
1. compelling Defendant Shawn Hogan, notwithstanding his continuing
invocation of his Fifth Amendment right, to produce all documents
responsive to eBay’s First and Second Set of Requests for Production that
were previously obtained by the FBI, including but not limited to any such
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documents that may be within his control at third party NetHere, Inc.;
2. ordering Defendant DPS, Inc. to conduct a diligent search for and produce
all documents responsive to eBay’s First and Second Set of Requests for
Production, including by exercising any and all rights that it may have to
obtain documents from third party NetHere, Inc.; and
3. striking Defendant DPS, Inc.’s objections to eBay’s Interrogatories and
certain of eBay’s Requests for Admission and Requests for Production on
the grounds that the definition of “DPS” is overbroad, unduly burdensome
and oppressive and ordering DPS, Inc. to provide supplemental responses to
those requests that include information regarding “DPS” as defined by eBay.
DATED: September 29, 2009 DAVID R. EBERHART
SHARON M. BUNZEL
COLLEEN M. KENNEDY
O’MELVENY & MYERS LLP
By: /s/ David R. Eberhart
DAVID R. EBERHART
Attorneys for Plaintiff eBAY INC.
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