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Twitch Interactive, Inc. v. Johnston

United States District Court, N.D. California, San Jose Division

March 27, 2017

TWITCH INTERACTIVE, INC., Plaintiff,
v.
JUSTIN JOHNSTON, et al., Defendants.

          ORDER GRANTING MOTION FOR LEAVE TO SEEK LIMITED DISCOVERY

          BETH LABSON FREEMAN United States District Judge.

         Plaintiff Twitch Interactive, Inc. (“Twitch”) brings this action against Defendants for allegedly providing bot services that artificially inflate broadcaster popularity statistics in the gaming community, in an attempt to qualify for compensation through Twitch's program. Compl. ¶¶ 1-2, ECF 1. Twitch now moves for leave to seek limited discovery on Defendants Michael and Katherine Anjomi (the “Anjomis”) and third-party payment service providers and financial institutions associated with Defendants Erik Bouchoev, the Anjomis, and Alex Renfrow (collectively, “Defendants”). Mot., ECF 43. Defendants have failed to appear and the motion is unopposed. Pursuant to Civ. L.R. 7-1(b), the Court finds Twitch's motion suitable for submission without oral argument and hereby VACATES the hearing scheduled for July 13, 2017. For the reasons set forth below, the Court GRANTS Twitch's motion.

         I.BACKGROUND

         Twitch broadcasts gaming-related content over the Internet and provides forums for users to play, stream, watch, and discuss video games. E.g., Compl. ¶¶ 1, 21-31. Twitch also evaluates individual broadcasters' popularity by tracking, among other things, how many people view the broadcaster's stream, and rewards popular broadcasters by sharing revenue through its Partnership Program. Id. ¶¶ 1, 2, 21-31. According to Twitch's complaint, Defendants operated bot services that falsely inflate usage in order to deceive Twitch into believing that certain broadcasters are more popular than they really are. Id. ¶ 3, 43-51. Twitch also alleges that it found that Defendants used third-party payment services such as PayPal to facilitate financial transactions with individuals who purchase these bot services. See, e.g., id., Ex. D at 2, 7; id., Ex. B at 7; id., Ex. G at 4; see also Simpkins Decl.”) ¶ 2-4, ECF 43-2; Exs. A-C, ECF 43-3 (screen captures of relevant websites showing that Defendants used PayPal).

         Twitch further alleges that Defendants advertised their services using the Twitch trademarks in a manner that is likely to deceive consumers about the services' affiliations with Twitch, and violated Twitch's Terms and Guidelines to which Defendants agreed when they created accounts with Twitch or otherwise accessed the Twitch website. See Compl. ¶¶ 34, 69, 79, 120; Exs. B, B-II, D, D-II, G, G-II.

         In June 2016, Twitch filed suit against Defendants for various claims including trademark infringement, 15 U.S.C. § 1114; unfair competition, 15 U.S.C. § 1125(a); cybersquatting; and breach of contract. Compl. ¶¶ 122-45, 155-64. Over the course of several months, Twitch attempted to locate and personally serve Defendants without much success. See Twitch's Mot. for Alternative Service of Process, ECF 29. This Court then granted Twitch leave to serve certain Defendants by alternative means. ECF 33. Twitch successfully served those Defendants on January 24, 2017. ECF 35. Defendants Bouchouev, the Anjomis, and Renfrow did not respond to the Complaint, and the Clerk entered default as to them on March 8, 2017. ECF 41.

         Now pending before the Court is Twitch's motion for leave to conduct limited discovery to obtain information in support of a future motion for default judgment against Defendants, specifically for information on damages associated with at least the following claims: trademark infringement, unfair competition, cybersquatting, and breach of contract. Mot. 2.

         II. LEGAL BACKGROUND

         The scope and limitations of discovery are set forth by the Federal Rules of Civil Procedure. Rule 26 provides in pertinent part that:

Unless otherwise limited by court order, the scope of discovery is as follows: Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense-including the existence, description, nature, custody, condition, and location of any documents or other tangible things and the identity and location of persons who know of any discoverable matter. For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to the discovery of admissible evidence. All discovery is subject to the limitations imposed by Rule 26(b)(2)(C).

Fed. R. Civ. P. 26(b)(1).

         Trial courts have broad discretion in granting or denying discovery. Hallett v. Morgan, 296 F.3d 732, 751 (9th Cir.2002) (“broad discretion is vested in the trial court to permit or deny discovery, and its decision to deny discovery will not be disturbed except upon the clearest showing that denial of discovery results in actual and substantial prejudice to the complaining litigant”).

         Generally, Rule 26(d)(1) provides that “[a] party may not seek discovery from any source before the parties have conferred as required by Rule 26(f), except . . . when authorized by these rules, by stipulation, or by court order.” Fed.R.Civ.P. 26(d). Courts apply a “good cause” standard in considering motions to expedite discovery. Semitool, Inc. v. Tokyo Electron Am., Inc., 208 F.R.D. 273, 276 (N.D. Cal. 2002); see also Am. LegalNet, Inc. v. Davis, 673 F.Supp.2d 1063, 1066 (C.D. Cal. 2009); In re Countrywide Fin.Corp. Derivative Litig., 542 F.Supp.2d 1160, 1179 (C.D. Cal. 2008). Good cause may be found where the need for expedited discovery, in consideration of the administration of justice, outweighs the prejudice to the responding party. Semitool, 208 F.R.D. at 276.

         Good cause for expedited discovery is frequently found in cases involving claims of infringement and unfair competition or in cases where the plaintiff seeks a preliminary injunction. Id.; Pod-Ners, LLC v. N. Feed & Bean of Lucerne Ltd. Liability Co., 204 F.R.D. 675, 676 (D. Colo. 2002). Good cause may also exist in cases where a defendant has failed to appear, resulting in the entry of default against the defendant, and the plaintiff is in need of evidence to establish damages. See Sheridan v. Oak Street Mortg., LLC, ...


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