United States District Court, N.D. California, San Francisco Division
JOHN J. HURRY, et al., Plaintiffs,
FINANCIAL INDUSTRY REGULATORY AUTHORITY, INC., Defendant.
ORDER QUASHING SUBPOENA Re: ECF No. 1
BEELER United States Magistrate Judge.
The plaintiffs sued the Financial Industry Regulatory
Authority ("FENRA") in the District of Arizona; the
two remaining claims are defamation and false light based on
FINRA's allegedly providing false information to the
reporter William Meagher. See Hurry v. Fin. Indus. Reg.
Auth. Inc., No. CV-14-02490-PHX-ROS, 2015 U.S. Dist.
LEXIS 90147, at *9-l 1 (D. Ariz. Apr. 4, 2016). Mi".
Meagher published articles between 2013 and 2015 about
whether the plaintiffs' stock-brokerage firm was involved
in a fraud; the articles were based on a confidential source
(thought by plaintiffs to be FINRA). Id. They
subpoenaed Mi". Meagher for a deposition and for
documents relating to his communications with his source.
(ECF No. 3-1 at 5.) Mr. Meagher moved to quash on the ground
that his communications are protected by California's
reporter's-shield law and the reporter's privilege
under the federal and California constitutions. (Motion to
Quash - ECF No.1)
plaintiffs concede in then opposition that Mr. Meagher's
information about his sources is not a proper subject of a
subpoena, and they say that they "will not seek
information protected by California's shield law."
(Opposition - ECF No. 12 at 3.) But they maintain that
FINRA's defense is that the statements in Mr.
Meagher's articles are statements of opinion, and they
are entitled to ask Mr. Meagher if the statements are
opinion. (Id.) They want to ask other questions too:
• Did Mr. Meagher write every word in the articles?
• Did he write the headlines?
• Do the articles contain hyperbole, opinion, or
• What steps did Mr. Meagher take to fact-check his
• What are his publication's policies for
fact-checking stories, and did he follow the policies?
• What are his publication's policies for verifying
sources, and did he follow the policies? (Id. at
6-7.) They conclude that Mr. Meagher can object to any
questions on the ground that it is protected by the
reporter's privilege, but he cannot resist a deposition
entirely. (Id. at 7.)
Mr. Meagher filed the motion to quash, a former employee of
the plaintiffs identified himself as Mr. Meagher's
source. (ECF No. 13-2 at 3.) As Mr. Meagher points out in his
reply, this means that the plaintiffs' claims against
FINRA in the District of Arizona case survive only if the
plaintiffs identify FINRA as a separate source. (Reply - ECF
relevance of any deposition of Mr. Meagher is to support the
plaintiffs' defamation claims against FINRA. Information
is relevant if it establishes that FTNRA was the source of
the information in Mr. Meagher's articles. But as the
plaintiffs concede, that information is protected, and they
cannot seek it. Other topics - fact-checking, writing every
word, policies about fact-checking and verifying sources, and
following policies - do not bear on his claims against FINRA.
Or rather, if they do, it is because they necessarily call
for Mr. Meagher to reveal information about his use of
confidential sources to research and write his articles. That
is the only information material to the Arizona case, and it
is protected for the reasons that Mr. Meagher advances.
the subpoena appears targeted only at privileged information.
The court rejects the plaintiffs' argument that the
proper procedure is to require Mr. Meagher's deposition
and require serial objections to questions on the ground of
privilege. See Lemberg Law LLC v. Hussin, No.
16-mc-80066-JCS, 2016 U.S. Dist. LEXIS 76222, at *17 (N.D.
Cal. June 13, 2016). In Lemberg Law, the court
rejected a similar argument - the attorney-client privilege
can be asserted only with respect to specific documents or
deposition questions - and held that such an approach would
"virtually nullify Rule 45(d)(3)(A)(iii), which
requires the Comt to quash a subpoena that
'requires disclosure of privileged or other protected
matter, ' and would be inconsistent with cases where
courts have quashed deposition subpoenas that appear to be
targeted at privileged subject matter."
Id.(emphasis hi original). Moreover, the discovery
must be relevant to the claims and proportional to the needs
of the case. Fed.R.Civ.P. 26(b)(1). To the extent that
information is not privileged, it is of limited relevance to
the Arizona lawsuit. The court quashes the subpoena, with the
Meagher offers a compromise about general editorial
practices: he notes that this information can be disclosed
without a deposition. (Reply - ECF No. 13 at 13.) He also
offered to explore the possibility of responding to written
discovery; the plaintiffs rejected that compromise.
(Id.) If the plaintiffs want to propound written
discovery that is not geared toward privileged information,
they may do so within seven days. Mr. Meagher has seven days
to object, and the parties have seven days after that to file