United States District Court, S.D. California
ORDER GRANTING IN PART AND DENYING IN PART CALIBER
CORPORATION'S MOTION TO REOPEN DISCOVERY AND CONTINUE
DATES [ECF NO. 57]
Honorable Michael S. Berg, United States Magistrate Judge.
Currently
before the Court is Caliber Corporation's
(“Caliber”) “Motion to Re-open Discovery
and Extend Existing Dates for 90 Days” [ECF No. 57
(“Mot.”)], Bullets2Bandages, LLC's
(“B2B”), 2 Monkey Trading LLC's (“2
Monkey”), and Lucky Shot USA LLC's (“Lucky
Shot”) Opposition to the motion [ECF No. 72
(“Opp'n”)], and Caliber's Reply [ECF No.
74 (“Reply”)]. For the reasons set forth below,
Caliber's motion is GRANTED in part and DENIED in
part.
I.
FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff
B2B and Defendant Caliber manufacture and sell bullet-shaped
bottle openers. (ECF No. 5 at 9.) In 2013, B2B filed a suit
against Caliber alleging trademark infringement of B2B's
U.S. Trademark Registration No. 4, 364, 453 for the mark
CALIBER, and Caliber counterclaimed against B2B for
Caliber's Trademark Application No. 85/588, 703 for its
Bullet Trade Dress. (See Bullets2Bandages, LLC v. Caliber
Corp., 13cv3134-CAB(BLM), ECF Nos. 1 & 15.) On June
9, 2014, B2B and Caliber entered into a Settlement Agreement,
pursuant to which B2B assigned to Caliber all rights to the
CALIBER mark and agreed to not use the phrase “the
original” in relation with its sale of bullet-shaped
bottle openers. (ECF No. 5 at 10.) On June 9, 2014, B2B's
U.S. Trademark Registration No. 4, 364, 453 was assigned to
Caliber, and Caliber granted B2B a worldwide, non-exclusive
license to both the CALIBER mark and the Bullet Trade Dress.
(Id. at 9-10.)
In this
action, Plaintiff B2B alleges that in reliance on the
Settlement Agreement, it manufactures products that it sells
to wholesalers, including 2 Monkey, which in turn, sell the
products to consumers through Amazon and Etsy websites. (ECF
No. 1 at 4.) B2B discovered that someone complained to Amazon
and Etsy that 2 Monkey's products were infringing, and
the websites removed 2 Monkey's listings. (Id.)
B2B filed this suit against Caliber alleging breach of
contract, interference with existing contractual relations,
interference with prospective economic relations, and unfair
competition. (Id. at 6-9.) Caliber filed
counterclaims against B2B for breach of contract,
interference with prospective economic relations, negligent
misrepresentation, common law unfair competition, federal
unfair competition, and federal trademark infringement. (ECF
No. 5 at 16-22.) Caliber also asserted claims against
Third-Party Defendants Lucky Shot and 2 Monkey for common law
unfair competition, federal trademark infringement, federal
unfair competition, and counterfeiting. (Id. at
22-29.) Third-Party Defendants counterclaimed against Caliber
seeking a declaration that Trademark No. 4, 630, 557 is
invalid and cancellation of Federal Trademark Registrations
No. 4, 630, 557; 4, 364, 453; and 4, 930, 487. (ECF No. 28 at
17-22.)
II.
LEGAL STANDARD
Federal
Rule of Civil Procedure 16(b)(4) provides that a scheduling
order regulating discovery “may be modified only for
good cause and with the judge's consent.”
Fed.R.Civ.P. 16(b)(4). The Rule 16 good cause standard
focuses on the “reasonable diligence” of the
moving party. See Noyes v. Kelly Servs., 488 F.3d
1163, 1174 n.6 (9th Cir. 2007); Coleman v. Quaker Oats
Co., 232 F.3d 1271, 1294 (9th Cir. 2000). In its recent
ruling, the Ninth Circuit has instructed district courts to
consider the following factors when ruling on a motion to
amend a Rule 16 scheduling order to reopen discovery:
1) whether trial is imminent, 2) whether the request is
opposed, 3) whether the non-moving party would be prejudiced,
4) whether the moving party was diligent in obtaining
discovery within the guidelines established by the court, 5)
the foreseeability of the need for additional discovery in
light of the time allowed for discovery by the district
court, and 6) the likelihood that the discovery will lead to
relevant evidence.
City of Pomona v. SQM N. Am. Corp., 866 F.3d 1060,
1066 (9th Cir. 2017) (citation omitted). “District
courts have ‘broad discretion to manage discovery and
to control the course of litigation under Federal Rule of
Civil Procedure 16.'” Hunt v. Cty. Of
Orange, 672 F.3d 606, 616 (9th Cir. 2012) (quoting
Avila v. Willits Envtl. Remediation Trust, 633 F.3d
828, 833 (9th Cir. 2011)).
III.
DISCUSSION
Defendant
Caliber seeks to reopen discovery to obtain information
regarding the Asset Purchase Agreement (“the AP
Agreement”), which Plaintiff B2B and Third-Party
Defendant 2 Monkey executed after fact discovery cutoff.
(See Mot.) Caliber argues that the execution of the
AP Agreement justifies reopening discovery and represents a
change in circumstances providing good cause for extending
the remaining deadlines. (Id. at 6-12.) Caliber
asserts that the AP Agreement (1) purports to change the
relationships between the parties and affects nearly every
aspect of the case, (2) creates new claims of trademark
infringement and unfair competition against B2B by
retroactively removing B2B's trademark license and
granting it to 2 Monkey, (3) creates new breach of contract
claims against Third-Party Defendants by allegedly
transferring the license to 2 Monkey, and (4) creates new
interference with prospective economic advantage claims
against Third-Party Defendants. (Id. at 4-5.)
Caliber also contends that if it is not allowed to conduct
discovery into the AP Agreement, it can only pursue the
claims arising out of the Agreement by filing a separate
lawsuit, even though those claims are intertwined with the
existing trademark infringement and breach of contract claims
asserted in this case. (Id. at 5.)
B2B, 2
Monkey, and Lucky Shot (“the non-moving parties”)
oppose Caliber's motion arguing that reopening discovery
will prejudice them and will not lead to relevant evidence.
(Opp'n at 3-5.) In support, they assert that motions for
summary judgement have been submitted, and the rulings on
those motions could affect the need for any additional
discovery. (Id. at 3-4.) The nonmoving parties also
argue that Caliber was provided sufficient evidence that the
AP Agreement is valid, including an unreacted copy of the AP
Agreement marked as Attorneys' Eyes Only, a copy of the
cancelled check that 2 Monkey paid to B2B under the AP
Agreement, and the affidavit filed in support of B2B's
motion to substitute parties. (Id. at 4.) The
nonmoving parties further contend that the AP Agreement does
not create new claims and ask the Court to deny Caliber's
motion. (Id. at 5.)
Caliber
replies that the nonmoving parties made the discovery
regarding the AP Agreement directly relevant to the claims at
issue in this case, and reopening discovery will not
prejudice them. (Reply at 3.) Caliber states that some of the
pending claims are independent of the issues that will be
resolved by the rulings on the motions for summary judgement,
and will require analysis of the AP Agreement that purports
to retroactively change the relationship between B2B and 2
Monkey. (Id. at 4.) Caliber also argues that the AP
Agreement is highly relevant to Third-Party Defendants'
infringement defense and all of B2B's claims.
(Id. at 5.) Caliber asserts that the AP Agreement is
a sham, the limited evidence regarding the AP Agreement
provided to date is one-sided and incomplete, and Caliber
needs an opportunity to issue formal document requests,
interrogatories, and obtain deposition testimony related to
the AP Agreement, its formation, repercussions, and validity.
(Id. at 5-6.) Caliber thus moves to reopen discovery
and extend existing dates by ninety days. (Id. at
6.)
A.
Caliber's Motion ...