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Lads Network Solutions, Inc. v. Agilis Systems, LLC

United States District Court, E.D. Missouri, Eastern Division

November 4, 2019

LADS NETWORK SOLUTIONS, INC. Plaintiff,
v.
AGILIS SYSTEMS, LLC, et al., Defendants.

          MEMORANDUM & ORDER

          AUDREY G FLEISSIG UNITED STATES DISTRICT JUDGE.

         This matter comes before the Court on the motions of Plaintiff LADS Network Solutions, Inc. (“LADS”) to compel the production of documents (ECF No. 46) and to amend or correct the Case Management Order (ECF No. 53). For the reasons set forth below, the Court will defer ruling on the motion to compel, and the motion to amend or correct the Case Management Order will be granted.

         BACKGROUND

         LADS filed this copyright infringement action, alleging that Defendants used, without the permission or consent of LADS, certain copyrighted logistic software. Defendants filed a counterclaim for breach of contract, asserting that LADS is barred from asserting its copyright infringement claims pursuant to the terms of a separate settlement agreement. Defendants also assert a claim for breach of contract regarding a November 1, 2007 license agreement and a claim for abuse of process.

         The current discovery dispute arises out of three requests for production directed at Defendants seeking the production of: (1) database schema relevant to the litigation; (2) certain indemnification agreements; and (3) documents to support Defendants' claims of damages in their counterclaim.[1]

         Defendants oppose the production of source code due to its highly sensitive and confidential nature. ECF No. 55. Defendants believe that a neutral third party should be retained to host the data and “compare the dueling source codes.” Defendants also argue that the remainder of LADS's motion to compel is moot in light of Defendants' recent production. Lastly, Defendants express concerns that LADS will not comply with any protective order governing the confidentiality of the source code and reiterate the necessity of a third party protocol.

         LADS in its reply concedes that the only issue remaining before the Court is the production of Defendants' database schema. LADS emphasizes its discovery request seeks only Defendants' “database schema, ” which it asserts is a small portion of the computer source code. ECF No. 55 at 3. In response to Defendants' concerns regarding the disclosure of confidential information, LADS states that the stipulated protective order agreed by the parties provides for a protocol for the exchange of “highly confidential information, ” including database schema. LADS states that “if the remainder of the source code must be eventually produced, the necessary additional protocol can be put into place.” Id.

         On October 1, 2019, LADS filed a motion to amend the Case Management Order. ECF No. 53. Specifically, LADS maintains that it was unable to comply with the expert disclosure deadline because Defendants had not yet produced the source code. Defendants did not file any opposition to the motion.

         The Parties' Protective Order and Defendants' Responses

         As further background, the Court notes that LADS first served its first requests for production of documents and interrogatories on April 30, 2019. LADS agreed to give Defendants additional time to respond, and also complied with Defendants' request for separate requests for each Defendant.

         Prior to any responses, counsel began negotiating the terms of a protective order. In an email dated June 19, 2019, counsel for Defendants advised LADS' attorney he would have responses and objections to Plaintiff's counsel on or before June 28. He further stated:

I will have revisions to the protective order for our mutual review and discussion and subject to our clients (sic) further input. Please pay particular attention to the definition of “Highly Confidential Information”. My intention is to capture source code type information but the language may well be improved by the clients. As I stated, my contact is out until Tuesday.
One item I intended to address earlier today: When we spoke on May 30 you pitched the idea of a joint inspection protocol. I expressed reservations, which I still have. However, you were going to forward a proposal for review. Are you still intending to ...

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