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Gene Palermo v. Underground Solutions

June 11, 2012


The opinion of the court was delivered by: Barbara L. Major United States Magistrate Judge


Currently before the Court is Plaintiff's May 21, 2012 Motion for Leave to Take Immediate Discovery. ECF No. 5. Having read all papers filed in connection with Plaintiff's motion for expedited discovery, and having considered the issues raised therein, the Court DENIES Plaintiff's motion for the reasons set forth below.


Plaintiff Gene Palermo asserts that he is an expert, consultant, and published author in the plastic piping industry. ECF No. 1 at 2. Plaintiff further explains that over the course of his career, he has published a number of papers and given numerous presentations highlighting the associated with fused PVC piping. Id. Specifically, Palermo asserts that fused PVC piping prone to "rapid crack propagation," making it unsuitable for industrial use. Id. at 3. Instead, Palermo endorses high density polyethylene piping (HDPE) and polyvinyl chloride piping (PVC).

Sellers of fused PVC piping apparently are direct competitors with sellers of HDPE or PVC piping. Id. at 2.

In 2012, Palermo discovered a website with the domain Id. at Palermo asserts that he did not authorize the use of his name in the website, and the website's content was completely at odds with his work. Id. In particular, the website highlights the dangers of HDPE piping, which contradicts Palermo's true opinions. Id.

Palermo subsequently discovered that the registered owner of the website domain is Defendant UGSI ("UGSI") and that its listed contact person is April Bushhorn, a UGSI employee.

No. 5-1 at 3, Exh. A. Palermo also alleges that UGSI distributed anonymous digital pamphlets to plastic pipe manufacturers and purchasers across the country, which describe Palermo as an "unqualified shill" with "no independent credibility." ECF No. 5-2 at 1, Exh. B. the pamphlets were anonymous, Palermo discovered that the author was "bwalker" by uncovering the files' digital metadata.*fn1 ECF No. 5-3 at 1, Exh. C. Palermo believes "bwalker" to be Bob Walker, UGSI's Vice President of Engineering Applications. ECF No. 5 at 2.

On May 21, 2012, Palermo filed the instant action against UGSI. ECF No. 1. On that same Palermo also filed a motion for preliminary and permanent injunctive relief, and the motion expedited discovery currently pending before this Court. ECF Nos. 3 and 5. Palermo seeks order allowing him to obtain documents and electronically stored information from UGSI regarding the creation of the website and pamphlet, as well as the depositions of April Bushhorn

Bob Walker. ECF No. 5 at 2-3. In support of his motion, Palermo asserts that early discovery is necessary to determine which persons at UGSI were responsible for the website and pamphlet, the extent to which the pamphlet was published, and UGSI's motivation for disparaging Palermo's reputation. Id. Palermo further states that any information obtained from early discovery will be used to bolster his argument for injunctive relief. Id. at 3.


Legal standard for Expedited Discovery

A party may not seek discovery from any source before the Rule 26(f) conference unless party first obtains a stipulation or court order permitting early discovery. Fed. R. Civ. P. 26(d)(1). Courts in the Ninth Circuit apply the "good cause" standard in deciding whether to permit early discovery. Semitol, Inc. v. Tokyo Electron America, Inc., 208 F.R.D. 273, 276 (N.D. 2002) (adopting the conventional standard of "good cause" in evaluating a request for expedited discovery). Good cause exists "where the need for expedited discovery, in consideration of the administration of justice, outweighs the prejudice to the responding party."

Good cause for expedited discovery has been found in cases involving claims of infringement unfair competition or in cases where the plaintiff seeks a preliminary injunction. Id. In infringement cases, expedited discovery is frequently limited to allowing plaintiffs to identify Doe defendants. See, e.g., UMG Recordings, Inc. v. Doe, 2008 WL 4104207 (N.D. Cal. 2008) (granting leave to take expedited discovery for documents that would reveal the identity and contact information for each Doe defendant). In cases where preliminary injunction motions are pending, courts often permit expedited discovery designed to obtain information required for the preliminary injunction. See Dimension Data N. Am. v. NetStar-1, Inc., 226 F.R.D. 528, 532 (E.D.N.C. 2005) (denying request for expedited discovery in part because "the discovery requested is not narrowly tailored to obtain information relevant to a preliminary injunction determination"). In considering whether good cause exists, factors courts may consider include whether a preliminary injunction is pending; (2) the breadth of the discovery ...

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