Stone Brewing Co., LLC v. Molson Coors Brewing Company ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 STONE BREWING CO., LLC, Case No.: 3:18-cv-00331-BEN-LL 12 Plaintiff, ORDER ON: 13 v. (1) PLAINTIFF’S MOTION TO APPOINT SPECIAL MASTER; 14 MILLERCOORS LLC, (2) ASSOCIATED MOTIONS TO 15 Defendant. FILE UNDER SEAL; 16 [ECF Nos. 456, 458, 460, 465] 17 18 I. BACKGROUND 19 After extensive discovery, Plaintiff Stone Brewing Co. (“Stone”) seeks 20 appointment of a special master, claiming Defendant MillerCoors (“Miller”) is in 21 possession of relevant and responsive evidence that should be disclosed to Stone. Stone 22 asserts Miller has made misrepresentations to the Court regarding the status of this 23 evidence and repeated attempts to negotiate a resolution have been rebuffed by Miller. 24 Miller counters it has complied throughout the discovery process, that the evidence in 25 question has been previously adjudicated throughout the pre-trial process, and that 26 Stone’s sought-after special master is nothing more than an untimely motion to 27 reconsider previous discovery rulings. 28 1 II. LEGAL STANDARD 2 Courts may appoint a special master to “address pretrial and posttrial matters that 3 cannot be effectively and timely addressed by an available district judge or magistrate 4 judge of the district.” Fed. R. Civ. P. 53(a)(1)(C). “In appointing a master, the court 5 must consider the fairness of imposing the likely expenses on the parties and must protect 6 against unreasonable expense or delay.” Fed. R. Civ. P. 53(a)(3). “It is within a district 7 court's discretion to appoint a master, and to decide the extent of the duties of a special 8 master.” In re Hanford Nuclear Rsrv. Litig., 292 F.3d 1124, 1138 (9th Cir. 2002). 9 A court “should appoint a special master only in exceptional circumstances.” 10 Burlington N. v. Dep't of Revenue, 934 F.2d 1064, 1071 (9th Cir. 1991). Courts have 11 found such circumstances based on “the complexity of [the] litigation” or “problems 12 associated with compliance with the district court order.” United States v. Suquamish 13 Indian Tribe, 901 F.2d 772, 775 (9th Cir. 1990). In addition to a “history of 14 noncompliance,” exceptional circumstances may exist where a court “lack[s] the 15 resources to constantly monitor compliance with the decree.” Hook v. Ariz. Dep't of 16 Corr., 120 F.3d 921, 926 (9th Cir. 1997); see also Local 28 of Sheet Metal Workers' Int'l 17 Ass'n v. E.E.O.C., 478 U.S. 421, 482 (1986) (noting “the difficulties inherent in 18 monitoring compliance with the court's orders” and the parties' “established record of 19 resistance to prior state and federal court orders”). Though a history of noncompliance 20 weighs in favor of reference to a special master, the Ninth Circuit has rejected a 21 requirement that a court must find “intentional disregard of court orders before a special 22 master may be appointed.” Nat'l Org. For the Reform of Marijuana Laws v. Mullen, 828 23 F.2d 536, 543 (9th Cir. 1987). 24 III. STONE’S MOTION TO APPOINT SPECIAL MASTER [ECF No. 458] 25 Stone fails to assert any evidence that would persuade this Court that any discovery 26 matters cannot adequately be resolved by the district judge or magistrate judge. In its 27 Motion, Stone asserts “[c]ourts in this Circuit regularly appoint special masters to address 28 protracted discovery disputes and where a history of noncompliance with Court orders 1 makes close supervision of a party’s conduct necessary.” ECF No. 458, at 24. In support 2 Stone cites to two cases from the Northern District of California in which special masters 3 were appointed (ASIS Internet Servs. v. Active Response Grp., No. C07 6211, 2008 WL 4 2129417, at *6 (N.D. Cal. May 20, 2008) and Shenzhenshi Haitiecheng Sci. & Tech. Co. 5 v. Rearden LLC, No. 15-CV-00797-JST, 2019 WL 1560449, at *6 (N.D. Cal. Apr. 10, 6 2019)). 7 In ASIS, the Court appointed a special master as discovery was still ongoing and 8 likely to involve “further complex technical issues.” ASIS at 5. The Court’s appointment 9 of a special master in ASIS was “necessary to avoid wasting judicial resources and 10 preventing a timely resolution of the case.” Moreover, the appointment of a special 11 master was sua sponte, as the judge recognized the need. Id. at 6. This Court does not 12 recognize such a need in the present case. While the court in Shenzhenshi did appoint a 13 special master due to exceptional circumstances (the parties’ repeated failures to comply 14 with the district court’s order), those circumstances are not present in this case. 15 First, this Court need not consider why the Shenzhenshi court, or any other court, 16 appointed a special master. All that is relevant to the Rule 53 determination is that this 17 Court finds both the district judge and magistrate judge capable of handling any 18 discovery related issues in this case. Second, the Court finds the disputed discovery 19 matters raised by Stone were previously litigated. See ECF Nos. 250, 283, 284, 360, 363, 20 408, 409, 440. In the absence of being able to demonstrate an actual need for a special 21 master, Stone’s motion appears to be focused on relitigating discovery matters already 22 decided. Stone had the chance to seek reconsideration of the initial rulings on these 23 matters. Appointing a special master now would seem to be opening up an unorthodox 24 avenue for re-visiting discovery rulings while avoiding the usual hurdles of untimely 25 reconsideration motions. See Valley Forge Insurance Co. v. Hartford Iron & Metal, Inc., 26 2017 WL 365630, at *3 (N.D. Ind. Jan. 25, 2017). Here, discovery has been closed for 27 two years and the parties are preparing for a trial that commences in just over six weeks. 28 To the extent that either party has any trial-related disputes regarding discovery or any 1 other matters, this Court is prepared to address them. Accordingly, Plaintiff’s Motion for 2 Order to Show Cause Regarding Appointment of a Special Master is denied. 3 IV. MOTIONS TO FILE UNDER SEAL [ECF Nos. 456, 460, 465] 4 Concurrent with the Parties’ briefing on the special master issue, the Parties moved 5 to file under seal portions of their briefs, declarations, and supporting exhibits. 6 The portions of the briefs, declarations, and exhibits sought to be sealed contain, 7 reference, or discuss commercially sensitive and proprietary business data. These 8 documents have been previously designated “Confidential,” “Confidential – Attorneys’ 9 Eyes Only,” or “Privileged” pursuant to the Protective Order issued in this case. See ECF 10 No. 54. Specifically, these exhibits contain business information including detailed 11 business strategy and detailed agreements with third parties. 12 “[C]ompelling reasons sufficient to outweigh the public’s interest in disclosure and 13 justify sealing court records exist when such court files might . . . become a vehicle for 14 improper purposes, such as the use of records to . . . release trade secrets.” Kamakana v. 15 City & Cnty. of Honolulu, 447 F.3d 1172, 1179 (9th Cir. 2006). A “trade secret may 16 consist of any formula, pattern, device or compilation of information which is used in 17 one’s business, and which gives him an opportunity to obtain an advantage over 18 competitors who do not know or use it.” The Court can seal proprietary information to 19 protect a business from potential harm. See Obesity Research Institute, LLC v. Fiber 20 Research International, LLC, No. 15-CV-00595-BAS-MDD, 2017 WL 6270268, at *2 21 (S.D. Cal. Dec. 8, 2017) (granting motion to file documents containing proprietary 22 business information under seal). 23 Accordingly, the motions to seal are granted. Redacted versions of the 24 aforementioned documents have been filed on the public docket. The Clerk is directed to 25 file unredacted versions of the documents and exhibits lodged at Docket Numbers 457, 26 464, and 466 under seal. 27 V. CONCLUSION 28 Stone’s Motion for Order to Show Cause Regarding Appointment of a Special 1 || Master is denied. The parties’ related motions for leave to file are granted. 2 IT IS SO ORDERED. 3 . 4 || DATED: September 27, 2021 Ndypuire, 5 on. Roger T. Benitez United States District Court 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28