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Stoneeagle Services, Inc. v. UMB Bank, N.A.

United States District Court, W.D. Missouri, Western Division

May 22, 2015

UMB BANK, N.A., Respondent.


NANETTE K. LAUGHREY, District Judge.

Petitioner StoneEagle Services Inc. moves to compel Respondent UMB Bank, N.A. to comply with StoneEagle's subpoena duces tecum. [Doc. 4.] For the reasons explained below, StoneEagle's motion to compel UMB Bank's compliance with the subpoena, as narrowed by StoneEagle, is granted. In addition, StoneEagle shall bear all reasonable and necessary costs UMB Bank incurs in complying with the subpoena as narrowed.

I. Background

StoneEagle's motion to compel is related to a pending patent-infringement case StoneEagle filed in the Middle District of Florida, StoneEagle Services, Inc. v. Pay-Plus Solutions, Inc. and Premier Healthcare Exchange, Inc., no. 8:13-cv-2240 (M.D. Fla.). UMB Bank is not a party to that case. UMB Bank provides certain services related to the business of the Defendants in that case, and StoneEagle seeks documents from UMB Bank regarding those services. StoneEagle states it cannot obtain the documents from the Defendants. UMB Bank objects to StoneEagle's subpoena and has not produced any documents.

A. Overview of the Middle District of Florida case

StoneEagle claims[1] it has been creating, providing, and implementing technology for virtual payment systems for over ten years. StoneEagle developed and, in 2006, began marketing and selling a system for sending virtual payment and an explanation of payment (EOP) through a secured delivery method, such as by fax, to health care providers. In the health care field, third-party administrators and insurance companies (Payors) generally adjudicate medical claims and pay health care providers for the insured a portion of such claims. Hisorically, Payors mailed print checks and explanation of benefit (EOB) the health care providers who received payment. StoneEagle's patents involve methods and systems for facilitating payments of health care benefits on behalf of a Payor by securely transmitting the EOP and a virtual stored-value card pre-funded with an account balance equal to the authorized benefit amount. StoneEagle claims its patented payment system greatly reduces the Payors' costs and greatly increases the speed of getting payment to the health care provider.

The Defendants in the Middle District of Florida are also engaged in virtual payment processing. Both Defendants offer for sale, and Defendant Pay-Plus Solutions, Inc. sells, a virtual payment processing system called Pay-Plus® Select (formerly called "Pay-Plus® VCard"). StoneEagle claims the Defendants' Pay-Plus® Select system transmits a stored-value virtual card payment and an EOP to a health care provider by facsimile, in a manner that infringes StoneEagle's patents.

B. The subpoena duces tecum

After StoneEagle and the Defendants in the underlying case had engaged in extensive discovery, including document production and depositions, StoneEagle served the subpoena duces tecum on UMB on January 8, 2015, and an amended subpoena duces tecum on January 15, 2015, containing 24 requests for documents. StoneEagle seeks discovery from UMB regarding the allegedly infringing Pay-Plus® Select system. [REDACTED\], which acts as both issuing bank and manager of the Pay-Plus® Select system. [REDACTED\] the Defendants do not possess all the documents and information regarding the functions of the Pay-Plus® Select system performed by UMB. UMB served objections to the document subpoena on January 19, 2015.

On January 16, 2015, at the same time StoneEagle was seeking to subpoena documents from UMB Bank, StoneEagle served a subpoena pursuant Federal Rule of Civil Procedure 30(b)(6) on UMB Bank, for a deposition of UMB's corporate representative to be taken January 26, 2015. On January 22, 2015, UMB Bank, which is headquartered in Kansas City, Missouri, filed a miscellaneous action in this Court seeking to quash the deposition subpoena. UMB Bank, N.A. v. StoneEagle Services, Inc., case no. 4.15-mc-09001-NKL. With the parties' consent, the action was transferred on February 6, 2015 to the Middle District of Florida where the underlying litigation is pending.[2] Fed.R.Civ.P. 45(f). Prior to the transfer. and as directed by this Court, the parties attempted to reach a mutual resolution of their dispute about the deposition subpoena. At the same time, the parties also attempted to resolve their dispute about the document subpoena. StoneEagle narrowed the document requests to three categories:

(1) Documents relating to or evidencing UMB's contractual relationships with other nonparties, Store Financial Services, LLC, Interfax, U.S., Inc., and/or Red-Card Systems, LLC, as they relate to the Pay-Plus® Select system;
(2) Documents relating to or evidencing UMB's communications, other than those with PPS and PHX, regarding the Pay-Plus® Select system, specifically with Store Financial, Interfax, or Red-Card; and,
(3) Documents relating to or evidencing payments made or received by UMB relating to the Pay-Plus® Select system, specifically those to/from Store Financial, Interfax, or Red-Card.

[Doc. 4, pp. 4-5.] StoneEagle now states in its motion to compel that it no longer seeks to compel documents related ...

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