`
`United States District Court
`EASTERN DISTRICT OF TEXAS
`SHERMAN DIVISION
`
`
`
`
`Civil Action No. 4:16-CV-00737
`Judge Mazzant
`
`§
`§
`§
`§
`§
`§
`§
`
`
`REALPAGE, INC., REALPAGE VENDOR
`COMPLIANCE LLC
`
`
`v.
`
`ENTERPRISE RISK CONTROL, LLC,
`LONNIE DERDEN
`
`
`
`MEMORANDUM OPINION AND ORDER
`
`
`
`Pending before the Court is Plaintiffs’ Motion to Compel Document Production, Motion
`
`to Overrule Objections, and Motion to Compel Document Custodian Deposition (Dkt. #40).
`
`After reviewing the relevant pleadings and motion, the Court finds the motion should be granted
`
`in part and denied in part.
`
`BACKGROUND
`
`
`
`Plaintiffs RealPage, Inc. and RealPage Vendor Compliance LLC (collectively,
`
`“Plaintiffs” or “RealPage”) seek a preliminary injunction against Defendants Enterprise Risk
`
`Control, LLC (“Enterprise”) and Lonnie Derden (“Derden”) (collectively, “Defendants”) from
`
`using or benefiting from any of Plaintiffs’ trade secrets or other confidential or proprietary
`
`information (Dkt. #10 at p. 17–18). At the center of the controversy is the allegation that Derden
`
`and his employees took trade secret and confidential information from Plaintiffs and used it to
`
`create a competing product sold by Enterprise.
`
`
`
`On November 30, 2016, the Court entered an Agreed Order Continuing Preliminary
`
`Injunction Hearing and Setting Discovery and Briefing Schedule (Dkt. #33) and an agreed
`
`Protective Order and Source Code Protocol (Dkt. #34). The agreed discovery schedule set the
`
`week of December 19, 2016 as the time to make Source Code available for inspection in
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 2 of 20 PageID #: 1744
`
`accordance with the agreed protective order, and December 19, 2016 as the deadline for parties
`
`to serve responses to requests for production of documents (“RFPs”).
`
`
`
`On December 2, 2016, Plaintiffs served their first set of requests for production to
`
`Enterprise and Derden (Dkt. #40, Exhibits A, B). On December 19, 2016, Defendants served
`
`their responses to Plaintiffs’ first set of RFPs (Dkt. #40, Exhibits C, D). Between December 19,
`
`2016, and this motion, the parties discussed the allegedly inadequate responses (Dkt. #40,
`
`Exhibits E, F).
`
`
`
`On February 17, 2017, Plaintiffs filed this motion (Dkt. #40). On February 27, 2017,
`
`Defendants filed their response, indicating that certain additional disclosures would be made
`
`later that day (Dkt. #44). On the same day, Plaintiffs filed a reply (Dkt. #47). On February 28,
`
`2017, Plaintiffs filed a supplemental reply, confirming that Defendants produced 7,343 emails
`
`and their attachments the night before (Dkt. #48). On March 1, 2017, Defendants filed a sur-
`
`reply (Dkt. #51).
`
`LEGAL STANDARD
`
`
`
`Under Federal Rule of Civil Procedure 26(b)(1), parties “may obtain discovery regarding
`
`any nonprivileged matter that is relevant to any party’s claim or defense . . . .” Fed. R. Civ.
`
`P. 26(b)(1). Relevance, for the purposes of Rule 26(b)(1), is when the request is reasonably
`
`calculated to lead to the discovery of admissible evidence. Id.; Crosby v. La. Health & Indem.
`
`Co., 647 F.3d 258, 262 (5th Cir. 2011). It is well-established that “control of discovery is
`
`committed to the sound discretion of the trial court.” Freeman v. United States, 556 F.3d 326,
`
`341 (5th Cir. 2009) (quoting Williamson v. U.S. Dep’t of Agric., 815 F.2d 368, 382 (5th Cir.
`
`1987)).
`
`
`
`2
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 3 of 20 PageID #: 1745
`
`Rule 37 of the Federal Rules of Civil Procedure allows a discovering party, on notice to
`
`other parties and all affected persons, to “move for an order compelling disclosure or discovery.”
`
`Fed. R. Civ. P. 37(a)(1). The moving party bears the burden of showing that the materials and
`
`information sought are relevant to the action or will lead to the discovery of admissible evidence.
`
`Export Worldwide, Ltd. v. Knight, 241 F.R.D. 259, 263 (W.D. Tex. 2006). Once the moving
`
`party establishes that the materials requested are within the scope of permissible discovery, the
`
`burden shifts to the party resisting discovery to show why the discovery is irrelevant, overly
`
`broad, unduly burdensome or oppressive, and thus should not be permitted. Id.
`
`Federal Rule of Civil Procedure 34 governs requests for production of documents
`
`(“RFPs”), electronically stored information, and tangible things. Rule 34 requires responses to
`
`“either state that inspection and related activities will be permitted as requested or state with
`
`specificity the grounds for objecting to the request, including the reasons.” Fed. R. Civ. P.
`
`34(b)(2)(B). “An objection [to the entire request] must state whether any responsive materials are
`
`being withheld on the basis of that objection.” Id. 34(b)(2)(C). On the other hand, “[a]n objection
`
`to part of a request must specify the part and permit inspection of the rest.” Id.
`
`
`
`After responding to each request with specificity, the responding attorney must sign their
`
`request, response, or objection certifying that the response is complete and correct to the best of
`
`the attorney’s knowledge and that any objection is consistent with the rules and warranted by
`
`existing law or a nonfrivolous argument for changing the law. Fed. R. Civ. P. 26(g). This rule
`
`“simply requires that the attorney make a reasonable inquiry into the factual basis of his
`
`response, request, or objection.” Fed. R. Civ. P. 26(g) advisory committee note (1983).
`
`
`
`The federal rules follow a proportionality standard for discovery. Fed. R. Civ. P.
`
`26(b)(1). Under this requirement, the burden falls on both parties and the court to consider the
`
`
`
`3
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 4 of 20 PageID #: 1746
`
`proportionality of all discovery in resolving discovery disputes. Fed. R. Civ. P. 26(b)(1),
`
`advisory committee note (2015). This rule relies on the fact that each party has a unique
`
`understanding of the proportionality to bear on the particular issue. Id. For example, a party
`
`requesting discovery may have little information about the burden or expense of responding. Id.
`
`“The party claiming undue burden or expense ordinarily has far better information—perhaps the
`
`only information—with respect to that part of the determination.” Id.
`
`ANALYSIS
`
`
`
`Plaintiffs ask the Court to overrule Defendants’ objections and to order production of
`
`certain documents. The Court will take each request in turn, beginning with objections to specific
`
`RFPs and then addressing compulsion of documents.
`
`Objections
`
`Plaintiffs argue Enterprise’s objections to RFPs 1–3, 5–7, 9, 11–13, 15, 16, 18, and 19
`
`and Derden’s objections to RFPs 2–5 should be overruled because they are boilerplate and not
`
`stated with specificity. Defendants argue that Plaintiffs have not objected to the merits of the
`
`objections, but only the specificity. Defendants further argue that their objections are specific
`
`because they quoted specific portions of the questions that were vague or overbroad. The Court
`
`agrees that Plaintiffs only make specificity arguments in their motion regarding Defendants’
`
`responses to discovery. However, Plaintiffs do address the merits in their request to compel
`
`documents. Therefore, the Court will address specificity here and the merits later.
`
`a. “Subject to” language
`
`
`
`As an initial matter, the Court finds Defendants waived each of their objections, except to
`
`RFP 11, by including “subject to the foregoing” in the response. The practice of including
`
`“subject to” or “without waiving” statements after objections is an age-old habit comparable to
`
`
`
`4
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 5 of 20 PageID #: 1747
`
`belts and suspenders. This practice is “manifestly confusing (at best) and misleading (at worse),
`
`and has no basis at all in the Federal Rules of Civil Procedure.” Keycorp v. Holland, No. 3:16-
`
`cv-1948-D, 2016 WL 6277813, at *11 (N.D. Tex. Oct. 26, 2016) (quoting Carr v. State Farm
`
`Mut. Auto. Ins., 312 F.R.D. 459, 470 (N.D. Tex. 2015)). Such an objection and answer “leaves
`
`the requesting [p]arty uncertain as to whether the question has actually been fully answered,”
`
`Consumer Elecs. Ass’n v. Compras & Buys Magazine, Inc., No. 08-21085-CIV, 2008 WL
`
`4327253, at *3 (S.D. Fla. Sept. 18, 2008), and “wondering as to the scope of the documents or
`
`information that will be provided as responsive.” Heller v. City of Dall., 303 F.R.D. 466, 487
`
`(N.D. Tex. 2014).
`
`Rule 34 does not allow this kind of hedging. Rule 34 allows a party either to “state that
`
`inspection and related activities will be permitted as required” or to “state with specificity the
`
`grounds for objecting to the request.” Fed. R. Civ. P. 34(b)(2)(B). If a party chooses to object to
`
`part of a request, the party “must specify the part and permit inspection of the rest.”
`
`Id. 34(b)(2)(C). A response that states “subject to the foregoing” is not specific enough as to
`
`either (1) the completeness of the answer or (2) the availability of documents for inspection. The
`
`Court finds that Defendants’ inclusion of “subject to the foregoing” is not supported by the
`
`federal rules and goes against the purposes of a just, speedy, and inexpensive resolution. See
`
`Carr, 312 F.R.D. at 470.
`
`By answering questions “subject to” Defendants failed to specify the scope of their
`
`answer in relation to the request. This makes it impossible for Plaintiffs or the Court to assess the
`
`sufficiency of the response. Therefore, Defendants have waived each objection, except to RFP
`
`11, by including “subject to” language in their responses. See Carr, 312 F.R.D. at 470.
`
`
`
`5
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 6 of 20 PageID #: 1748
`
`Defendants shall fully supplement their responses to Plaintiffs’ requests, except RFP 11,
`
`consistent with the proper manner of responding or answering as laid out above.
`
`b. Boilerplate Objections
`
`
`
`Further, Defendants waived several objections by making boilerplate objections. It is
`
`well-established that parties cannot make general or boilerplate objections to discovery requests.
`
`Heller, 303 F.R.D. at 483 (N.D. Tex. 2014). Rule 34 requires that a response to an RFP “must
`
`either state that inspection and related activities will be permitted as requested or state an
`
`objection to the request, including the reasons.” Fed. R. Civ. P. 34(b)(2)(B). The party resisting
`
`discovery “must show specifically . . . how each [request] is not relevant or how each question is
`
`overly broad, burdensome or oppressive.” McLeod, Alexander, Powel & Apffel, P.C. v. Quarles,
`
`894 F.2d 1482, 1485 (5th Cir. 1990) (quoting Josephs v. Harris Corp., 677 F.2d 985, 991–92
`
`(3d Cir. 1982)). A party may not “refuse discovery simply by making a boilerplate objection that
`
`it is not proportional.” Rule 26(b)(1), advisory committee note (2015). Because “[i]n the face of
`
`[general] objections, it is impossible to know whether information has been withheld and, if so,
`
`why.” Heller, 303 F.R.D. at 483 (quoting Weems v. Hodnett, No. 10-cv-1452, 2011 WL
`
`3100554, at *1 (W.D. La. July 25, 2011)).
`
`
`
`Nearly all of Defendants’ responses begin with the objection:
`
`[Defendant] objects on the basis that the request is overbroad, unduly
`burdensome, and seeks information that is neither relevant nor likely to lead to the
`scope of admissible discovery considering the proportionality of the needs in this
`case, which includes the Parties’ relative resources vis-à-vis the other and the
`burden/expense if the proposed discovery and likeliness of any benefit.
`
`(Dkt. #40, Exhibit C, D). Defendants argue that their objections, including the one above, are not
`
`boilerplate because they point out specific portions of the request that are objectionable
`
`(Dkt. #44 at p. 17). The Court disagrees.
`
`
`
`6
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 7 of 20 PageID #: 1749
`
`“Boilerplate” means “standardized text” or “ready-made or all-purpose language.”
`
`Boilerplate, Merriam-Webster Collegiate Disctionary (11th ed. 2007); Boilerplate, Black’s Law
`
`Dictionary (10th ed. 2014). Defendants used the above objection on eighteen of their twenty-five
`
`RFP responses. This is the epitome of “standardized text.” Defendants appear to argue that
`
`because they provided slight variations to each RFP, except Enterprise’s RFP 15, that the
`
`objections are therefore specific to the request. The Court disagrees. Simply put, the above
`
`objection does not “state with specificity the grounds for objecting to the request.” Fed. R. Civ.
`
`P. 34(b)(2)(B). Defendants’ additional reasons after the objection, which often begin
`
`“specifically,” address separate concerns such as relevance or ambiguity. However, those
`
`objections stand or fall on their own. Therefore, Defendants’ failure to specify specific grounds
`
`in the above objection results in waiver of the objection. Fed. R. Civ. P. 34(b)(2)(B); Keycorp,
`
`2016 WL 6277813, at *11. The Court will now address the additional reasons that accompany
`
`some of Defendants’ responses.
`
`Enterprise’s responses to RFPs 1, 7, 9, 12, 16, and 18, and Derden’s response to RFP 2
`
`make the same boilerplate objection but add that certain words or phrases are “overbroad, vague,
`
`and ambiguous.” Defendants do not provide specific reasons for how these words are overbroad,
`
`vague, or ambiguous, and therefore Defendants waived their objections. Heller, 303 F.R.D. at
`
`483–93.
`
`Even if Defendants did not waive these objections, Defendants’ objections are overruled.
`
`Defendants have not met their burden to explain the specific and particular way that each request
`
`is overbroad, vague, or ambiguous after exercising reason and common sense to attribute
`
`ordinary definitions to terms and phrases used in the request. Id. at 491. Further, based on the
`
`Court’s review, these requests are not so overbroad, vague, or ambiguous as to be incapable of
`
`
`
`7
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 8 of 20 PageID #: 1750
`
`reasonable interpretation and to prohibit Defendants’ responses. Thus, these objections are
`
`overruled.
`
`Apart from the boilerplate objections, Enterprise objects to RFP 2 because documents
`
`referring to products and services to the “now unlimited marketplace” of single-family and
`
`multi-family marketplace is too broad. However, Enterprise also objects to RFPs 7 and 12
`
`because they ask for documents that ask for more than the single-family and multi-family real
`
`estate management areas because only the single-family and multi-family markets were
`
`restricted. Enterprise explains that it does work for commercial tenants as well, but that was
`
`never restricted and therefore not part of the claims before the Court. The Court finds that the
`
`responses to RFPs 7 and 12 are inconsistent with the response to RFP 2. If Enterprise does
`
`business in three areas, two of which are part of the suit, the Court does not see how a request for
`
`documents relating to the two areas that are part of the suit is overbroad. Therefore, the Court
`
`overrules Enterprise’s objection that the “unlimited” marketplace is overbroad. However, the
`
`Court sustains Enterprise’s objections to documents encompassing commercial tenants in RFPs 7
`
`and 12.
`
`c. Relevance Objections
`
`Enterprise objects to RFPs 2, 6 and 12, and Derden objects to RFP 3 because requests for
`
`documents about activities in the single-family or multi-family rental property markets after
`
`restrictions in Derden’s Employment Agreement expired are not relevant to the claims or
`
`defenses raised in this case. Plaintiffs do not respond to the merits of these objections. The Court
`
`finds these objections sufficiently specific and agrees with Defendants. The Court sustains the
`
`objections with modification.
`
`
`
`8
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 9 of 20 PageID #: 1751
`
`The Employment Agreement expressly states that the Significant Owner Agreement’s
`
`(“SOA”) restrictive period controls noncompetitive activities (Dkt. #1, Exhibit C at p. 6). The
`
`SOA’s period is for five years after the date of Compliance Depot’s sale to Plaintiffs.1 The
`
`Employment Agreement only restricted competition for three years after Derden’s termination.
`
`The SOA’s period ended on May 5, 2016, after the Employment Agreement would have ended.
`
`Therefore, Derden was restricted from competing until May 5, 2016. The Court sustains
`
`Defendants’ objections to documents relating to the development or provision of products or
`
`services offered by Defendants after the restrictions in the SOA expired.
`
`Enterprise also objects to RFP 11 because documents showing payments to persons who
`
`were involved in the development of Enterprise’s risk management application is not relevant.
`
`Enterprise has agreed to produce documents that it relied upon in requesting a preliminary
`
`injunction bond and has produced those documents. Based on Enterprise’s agreement, the Court
`
`finds Enterprise has waived its objection on relevance grounds.
`
`d. Privilege & Confidentiality
`
`Enterprise also objects to RFPs 3 and 13 for privilege concerns and 7, 9, 11, and 13 for
`
`confidentiality or proprietary issues. Derden objects to RFPs 3 and 4 on privilege grounds. On
`
`February 27, 2017, Enterprise produced documents responsive to RFP 11, which contained
`
`employee information. Based on Enterprise’s response and disclosure of information, the Court
`
`finds Defendants waived the objection to RFP 11.
`
`Regarding confidential and proprietary objections, Plaintiffs note that a protective order
`
`already governs this case. To the extent that Enterprise is withholding any documents or
`
`
`1 Compliance Depot, L.L.C. is a predecessor RealPage Vendor Compliance LLC. A more detailed factual history of
`the Compliance Depot—RealPage transaction is available in the Court’s Memorandum Opinion and Order
`(Dkt. #39)
`
`
`
`9
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 10 of 20 PageID #: 1752
`
`information based on a confidentiality objection, those objections are overruled, and any
`
`responsive documents should be produced subject to the protective order.
`
`Finally, a privilege log must be produced for any documents, communications, or other
`
`materials withheld from production on privilege grounds. See Fed. R. Civ. P. 26(b)(5). Neither
`
`party addresses whether Defendants produced such a log. To the extent that Defendants have not
`
`done so, the Court orders Defendants to produce a privilege log for each assertion of privilege
`
`within seven (7) days of this order.
`
`e. Harassing and Fishing Expedition
`
`
`
`Enterprise objects to RFPs 5–7, 13, and 19, and Derden objects to RFPs 3 and 5 as
`
`harassing and a fishing expedition. Defendants’ only reason for this objection is that Plaintiffs
`
`are Defendants’ competitors. Considering the claims made in this case, the Court finds
`
`Defendants’ reasoning is insufficient to explain the basis for these objections. Fed. R. Civ.
`
`P. 34(b)(2)(B). Therefore, the Court overrules Defendants’ objections on these grounds.
`
`Document Production
`
`
`
`For the Court to order production, Plaintiffs must show that Defendants failed to produce
`
`documents or to permit the appropriate inspection. Fed. R. Civ. P. 37(a)(3)(B). An evasive or
`
`incomplete response suffices to show a failure to respond. Id. 37(a)(4). When some documents
`
`have been produced in response to a request, Courts have interpreted “evasive or incomplete” to
`
`place a modest burden on the requesting party to support, with existing documents, a reasonable
`
`deduction that other documents may exist or did exist but have been destroyed. See Zubulake v.
`
`UBS Warburg LLC, 217 F.R.D. 309, 313 (S.D.N.Y. 2003); see also Hubbard v. Potter,
`
`247 F.R.D. 27, 29 (D.D.C. 2008).
`
`
`
`10
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 11 of 20 PageID #: 1753
`
`a. Communications Regarding Development
`
`
`
`Plaintiffs argue that Defendants should produce “[c]ommunications between and among
`
`employees or representatives or [Enterprise] and any third party related to the development of
`
`[Enterprise’s] vendor compliance application” because they are directly relevant to the claim that
`
`Enterprise’s application was developed using RealPage’s trade secrets. Defendants argue that
`
`this request is overbroad because it asks for every work-related communication between
`
`Enterprise’s employees and third parties.
`
`
`
`The Court has already determined that Enterprise’s overbreadth objection was waived as
`
`it was boilerplate and followed by “subject to” language. However, a party will still not be
`
`compelled to produce documents if the request is overbroad or unduly burdensome on its face.
`
`E.g., Aikens v. Deluxe Fin. Servs., Inc., 217 F.R.D. 533, 537–38 (D. Kan. 2003). The federal
`
`rules follow a proportionality standard for discovery. See Fed. R. Civ. P. 26(b)(1). Under
`
`Rule 26, a request must be proportional to the needs of the case when considering, “the
`
`importance of the issues at stake in the action, the amount in controversy, the parties’ relative
`
`access to relevant information, the parties’ resources, the importance of the discovery in
`
`resolving the issues, and whether the burden or expense of the proposed discovery outweighs its
`
`likely benefit.” Fed. R. Civ. P. 26(b)(1).
`
`
`
`Plaintiffs’ request is proportional. Defendants’ development of its vendor compliance
`
`application is very important to the issues at stake in the action. Plaintiffs’ claim centers on the
`
`development of the vendor compliance application. This discovery may turn the case for either
`
`side. The amount in controversy is large. Defendants’ own alleged harm from an injunction
`
`against the application is $12 million. Only Defendants have access to the communications
`
`
`
`11
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 12 of 20 PageID #: 1754
`
`requested. Finally, the burden is small because Defendants’ company is a small, relatively new
`
`company and only a handful of people worked on the application.
`
`
`
`On February 27, 2017, Defendants produced 7,343 emails and their attachments. It is not
`
`clear whether these emails are responsive to this request, but it is clear that none of the emails are
`
`dated before July 3, 2013.
`
`Plaintiffs contend this production is still not enough. Plaintiffs argue that Defendants
`
`should be compelled to produce additional emails regarding Bean’s assignment from when
`
`Derden and Bean left RealPage in June 2012 to when Bean joined Defendants as a full-time
`
`employee on July 3, 2013. The Court agrees.
`
`Derden and Tom Bean (“Bean”) were RealPage employees until June 2012. In June
`
`2012, Derden and Bean left RealPage and began their own companies. Derden began Enterprise,
`
`and Bean began a software consulting company called IDC Software LLC (“IDC”). At some
`
`point between June 2012 and July 2013, Bean asked Derden to see if Enterprise needed IDC’s
`
`services. Ultimately, Bean developed a credentialing application based on Derden’s instruction.
`
`In July 2013, Bean uploaded the code that he had created onto Enterprise’s server.
`
`Defendants have not produced any emails for the period before Bean uploaded his code
`
`to Enterprise’s server. Clearly, these would be relevant. Therefore, the Court orders Defendants
`
`to provide all communications between and among employees or representatives or Enterprise
`
`and any third party related to the development of Enterprise’s vendor compliance application for
`
`the period between June 2012 and July 3, 2013, or to certify that all responsive emails have been
`
`produced.
`
`
`
`12
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 13 of 20 PageID #: 1755
`
`b. Email Attachments
`
`
`
`Plaintiffs argue that the Court should compel production of attachments to two emails.
`
`While this motion was pending, Defendants produced one of the attachments. Plaintiffs now
`
`appear only to complain about the email labelled ERC000404. In their sur-reply, Defendants
`
`assert that no document is being withheld (Dkt. #51 at p. 2). Assuming that Defendants have
`
`produced the other attachment, the Court will only address the email labeled ERC000404.
`
`
`
`The attachment to ERC00404 is discoverable because it is relevant to Plaintiffs’ trade
`
`secret claim. Fed. R. Civ. P. 26(b)(1). Defendants hardly dispute this point (See Dkt. #44 at p. 9).
`
`Defendants have located the powerpoint, but have not produced it apparently because it was
`
`never distributed in written form, but only shown during an in-person presentation. The
`
`powerpoint supposedly “illustrate[s] the new look and feel of [Enterprise’s] application” (Dkt.
`
`#40, Exhibit G). The Court finds that the powerpoint, if it exists, should be produced. Plaintiffs
`
`have shown evidence that suggests the powerpoint exists and Defendants have not provided a
`
`valid reason for withholding it. Defendants shall certify in their amended response whether the
`
`powerpoint referenced in the email labelled ERC000404 was used during the in-person
`
`presentation. If Defendants cannot faithfully certify that the powerpoint was not used,
`
`Defendants shall produce the powerpoint because it is relevant and responsive to requests asking
`
`for communications relating to any products or services offered by Defendants to potential
`
`customers. Plaintiffs’ motion to compel is granted on this ground.
`
`c. Product Data, Design Specifications, Operations Specifications, and Related Documents
`
`
`
`Plaintiffs argue that the Court should compel production of documents that Defendants
`
`said they would produce in their initial disclosures. Specifically, Defendants stated that they
`
`would produce “product data for [Enterprise’s] vendor compliance software, Indexer and Vendor
`
`
`
`13
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 14 of 20 PageID #: 1756
`
`Services, which includes highly confidential and attorneys’ eyes only protected source code,
`
`product design specifications, operation specifications, and related documents” as documents
`
`that Defendants have in their possession, custody, or control and may support their claims.
`
`Defendants argue that the source code satisfied this disclosure. Plaintiffs acknowledge that
`
`Defendants produced source code, but argue that Defendants have not completely disclosed its
`
`source code because there is a gap between June 2012 and July 2013 that Defendants do not
`
`adequately explain.
`
`
`
`Plaintiffs provided a declaration from their forensic investigator, David Cowen
`
`(“Cowen”), to prove that material information is missing from the source code that Defendants
`
`produced. In his declaration, Cowen identifies facts that suggest significant edits to the source
`
`code occurred between July 2012 and July 2013. Notably, Cowen states that “ERC
`
`Development” made a comment on July 23, 2012. Cowen also states that other employees at
`
`Enterprise used their real names when making comments and that Bean used his real name as
`
`early as October 23, 2012 when making comments. This suggests the “ERC Development” is not
`
`necessarily Bean or that Bean was not working completely independently from Enterprise when
`
`developing code. Further, Bean added a comment on April 28, 2013 in the files “notcontrol.cs”
`
`and “othercontrol.cs”. The Court finds that the comments are enough to suggest that significant
`
`changes were made to the source code between July 2012 and July 2013.
`
`Defendants explain this gap in their response. Defendants produced affidavits by
`
`Enterprise’s software developer, Bean, and Chief Financial Officer, Gary Hofer (“Hofer”)
`
`recounting the events from Bean’s development of the application in 2012 all the way up to this
`
`litigation. According to Bean’s affidavit, IDC developed code for Enterprise before July 2013. In
`
`July 2013, Enterprise hired Bean as a full-time employee. At that time, Bean transferred his code
`
`
`
`14
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 15 of 20 PageID #: 1757
`
`onto Enterprise’s computers and removed the previous work from IDC’s computer, well before
`
`either Bean or Enterprise anticipated litigation. Further, Enterprise certifies by Bean’s and
`
`Hofer’s affidavit that all the code in their possession, custody, and control has been produced.
`
`The Court is in a tough position. Plaintiff has produced evidence that significant changes
`
`were made. However, Defendants have explained that the code containing those changes was
`
`destroyed in good faith before this litigation. Even though evidence may suggest that more code
`
`existed at one time, the Court cannot order a party to produce what it does not have. Orix USA
`
`Corp. v. Armentrout, No. 3:16-mc-63-N-BN, 2016 WL 4095603, at *5 (N.D. Tex. Aug. 1, 2016).
`
`Plaintiffs are entitled to an unequivocal representation, under oath, that Defendants have
`
`produced all source code that they have in their possession, custody, and control, and that they
`
`are not withholding any responsive code based on their objections or otherwise. Plaintiffs have
`
`received that representation in Bean’s and Hofer’s affidavit, as well as Defendants’ responses to
`
`this motion. The Court declines to order anything further from Defendants on this issue at this
`
`time.
`
`
`
`Under the same heading, Plaintiffs complain that Enterprise’s responses to RFPs 1 and 8
`
`are insufficient because the requests sought documents referred to in Defendants’ initial
`
`disclosures and Daniel Millstone’s November 7, 2016 declaration (Dkt. #21, Exhibit B) that were
`
`not provided. Defendants respond that they have produced all documents and that there simply
`
`are not as many documents as Plaintiffs believe there to be. The Court agrees with Defendants.
`
`
`
`Plaintiffs cite the Joseph Regan letter dated February 10, 2017 (Dkt. #40, Exhibit F) as
`
`evidence that Defendants have not responded to repeated efforts to obtain the information. The
`
`Court disagrees. The Regan letter specifically responds to Plaintiffs’ letter requesting documents.
`
`Defendants explain that (1) it could not locate the “piece of paper” referenced in Millstone’s
`
`
`
`15
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 16 of 20 PageID #: 1758
`
`declaration; (2) it admitted that the source code itself represents Millstone’s vision;
`
`(3) Enterprise could not locate documents that evidence the “original design”; and (4) Enterprise
`
`produced some Jira work order documents documenting corrections for “bugs” (Dkt. #40,
`
`Exhibit F at p. 4). Further, in response to this motion, Defendants provide the affidavit of their
`
`CFO, Hofer. Hofer clarifies that Jira is the only program Enterprise has used and that all Jira
`
`documents, not just “bug fixes” have been produced. Thus, the Court finds that Defendants have
`
`adequately responded to these requests. Plaintiffs’ motion on this ground is denied.
`
`d. Project Management Software
`
`
`
`Next, Plaintiffs argue that Defendants should be compelled to produce the content of any
`
`project management software Enterprise used to develop its vendor compliance application
`
`(Dkt. #40 at p. 9). Plaintiffs cite RFPs 1 and 8 as the relevant requests. The same reasoning
`
`applies as it did for documents showing product data, design specifications, operations
`
`specifications, and related documents above. Defendants have sworn under penalty of perjury
`
`that Enterprise only used Jira and has produced those documents. Plaintiffs’ motion on this
`
`ground is denied.
`
`e. Evidence of Payments for Design and Development
`
`
`
`Plaintiffs argue that Defendants should be compelled to produce documents showing the
`
`$3.3 million in expenses, including payroll and overhead, to create the vendor compliance
`
`application as requested in RFPs 9 and 11. Defendants respond that this information is
`
`confidential as it relates to the individual employees’ compensation. Before this motion,
`
`Defendants produced a summary sheet of compensation for six employees with the names
`
`redacted. On February 27, 2017, Defendants produced a seventeen-page document showing
`
`payroll expenses for 2013 through 2016. In their supplemental reply, Plaintiffs complain that this
`
`
`
`16
`
`
`
`Case 4:16-cv-00737-ALM Document 61 Filed 03/29/17 Page 17 of 20 PageID #: 1759
`
`is still not enough because it does not contain any payments to Bean from Ju