United States District Court, W.D. Washington, Seattle
ORDER ON PLAINTIFFS' MOTION FOR PROTECTIVE ORDER
AND DEFENDANT'S MOTION TO COMPEL
S. Lasnik United States District Judge.
matter comes before the Court on the “Motion to
Compel” filed by defendant DL Evans Bank (“the
Bank”), see Dkt. #28, and the “Motion
for Protective Order” filed by plaintiffs BGH Holdings,
LLC (“BGH”), Ginger Atherton, Henry Dean, and
their marital community. Dkt. #35.
case concerns a judgment (“Idaho Judgment”)
obtained by the Bank against plaintiff Dean for over $1
million out of a failed Sun Valley real estate development.
Dkt. #28-1 (Farren Decl.) at ¶ 4. The Bank obtained the
judgment in Idaho and domesticated it in Washington. It then
obtained a writ of execution against Dean in 2018.
Id. Plaintiffs brought their action on September 24,
2018, asserting that the right of execution had expired on
the Idaho Judgment and that the Bank had improperly seized
their property. Dkt. #1. An Amended Complaint was filed the
next day. Dkt. #4. The Bank asserted counterclaims for
declaratory judgment regarding the enforceability of the
Idaho Judgement. Dkt. #14. In its Amended Answer, Affirmative
Defenses and Counterclaims, the Bank added counterclaims
against BGH and Atherton as well as new parties WN3 LLC
(“WN3”), Jim Dean (“Jim”), Frank Dean
(“Frank”) and Does 1-5, asserting that Dean had
made fraudulent transfers to all of them. Dkt. #18
(Countercl.) at ¶¶ 18-24. By an order dated June
14, 2019, the Court denied plaintiffs' motion to strike
the Bank's amended counterclaims, denied plaintiffs'
motion to dismiss the added parties, and granted the
Bank's request for an extension to serve the new
additional defendants. Dkt. #71. Counsel have entered
appearances for Frank, Jim and WN3. See Dkts.
January 28, 2019, the Bank served discovery requests. Farren
Decl. at ¶ 5; see Ex. 1, Dkt. #28-1 at 6-22. On
March 5, 2019, plaintiff's counsel sent an email to
defense counsel objecting to the discovery requests and
requesting a standstill agreement. Farren Decl. at ¶ 6;
see Ex. 2, Dkt. #28-1 at 24. In April 2019, the Bank
issued Notices of Intent to Serve Subpoenas Duces Tecum on JP
Morgan Chase Bank (“JP Morgan”), see Ex.
A, Dkt. #36-1, and HyTech Power, Inc. (“HTP”),
see Ex. B, Dkt. #36-2. Dkt. #36 (Cadranell Decl.) at
¶¶ 2-3. Counsel met and conferred on May 6, 2019 in
an attempt to resolve all outstanding discovery disputes.
Id. at ¶ 4; Farren Decl. at ¶ 10. The Bank
filed its motion to compel on May 16, 2019. Dkt. #28.
Plaintiffs filed their motion for a protective order on May
23, 2019. Dkt. #35.
state that they do not object to discovery requests
pertaining to alleged transfers from Dean to Atherton and
BGH. Dkt. #35 at 5. They do object to requests relating to
additional defendants Jim, Frank, and WN3. Id. at
5-6. They also argue that some of the Bank's
Interrogatories and Requests for Production
(“RFP”) are irrelevant, and that the subpoenas
duces tecum issued to JP Morgan and HTP should be quashed.
Id. at 7. Finally, they argue that the discovery
produced by plaintiffs in response to the Bank's requests
should be revealed only to the Bank and its lawyers.
Id. at 9. Dean claims that an individual with whom
he used to work at HTP, Mark Calvert, formed a company called
Karma Power, LLC that purchased the Idaho Judgment at issue
in this case in 2017. Ex. A, Dkt. #49-1 at 2. According to
Dean, Calvert was unhappy with an arbitration decision in
which he lost a claim for shares and options in HTP and has
since been attempting to direct litigation against Dean, HTP,
and HTP's other shareholders.
#41 (Dean Decl.) at ¶¶ 2-8; see Ex. A,
Dkt. #41-1; see Ex. B, Dkt. #41-2. Dean states that
he has not produced his own financial documents, or those of
Atherton or BGH, because he did not want them to be shared
with Calvert. He claims that he will turn them over after the
parties have entered a protective order. Dean Decl. at
Court may issue a protective order to “protect a party
or person from annoyance, embarrassment, oppression, or undue
burden or expense”. Fed.R.Civ.P. 26(c)(1).
“Generally, the public can gain access to litigation
documents and information produced during discovery unless
the party opposing disclosure shows ‘good cause'
why a protective order is necessary.” Phillips ex
rel. Estates of Byrd v. Gen. Motors Corp., 307 F.3d
1206, 1210 (9th Cir. 2002). “For good cause to exist,
the party seeking protection bears the burden of showing
specific prejudice or harm will result if no protective order
is granted.” Id. (citing Beckman Indus.,
Inc. v. International Ins. Co., 966 F.2d 470, 476 (9th
Cir. 1992)). “If a court finds particularized harm will
result from disclosure of information to the public, then it
balances the public and private interests to decide whether a
protective order is necessary.” Id. (citation
Fraudulent Transfers to Additional Defendants
previously discussed, the Court has permitted the Bank to
assert counterclaims concerning fraudulent transfers made to
Jim, Frank and WN3. Plaintiffs' objections in that regard
therefore no longer apply. Dkt. #48 at 4.
Subpoenas Duces Tecum
subpoena duces tecum to JP Morgan requests documents
pertaining to “[a]ccount statements, canceled checks,
deposit memos and account agreements for any bank accounts
owned by Ginger Atherton or Henry W. Dean for the period of
January 1, 2015 to the present.” Ex. A, Dkt. #36-1 at
7. The subpoena duces tecum to HTP requests a range of
documents pertaining to HTP and Dean and Atherton's
stock, equity or ownership in it. Ex. B, Dkt. #36-2 at 7-8.
“Within the Ninth Circuit there remains doubt as to
whether a party has standing to quash a subpoena to a third
party on any basis.” Silcox v. AN/PF Acquisitions
Corp., No. C17-1131 RSM, 2018 WL 1532779, at *2 (W.D.
Wash. Mar. 29, 2018) (citing In re Rhodes Cos., LLC,
475 B.R. 733, 738-40 (D. Nev. 2012)). However, this Court has
held that “a party has standing to move to quash a
subpoena issued to a non-party only to the extent the
subpoena seeks documents over which the party has a
‘personal right or privilege.'” Coalview
Centralia, LLC v. Transalta Centralia Mining LLC, No.
3:18-CV-05639-RBL, 2019 WL 2563851, at *2 (W.D. Wash. Mar.
21, 2019) (quoting Eric v. Van Cleave, No.
C16-1278RSM, 2017 WL 553276, at *6 (W.D. Wash. Feb. 10,
2017)). Plaintiffs argue that the subpoenas should be quashed
because they seek private and confidential ...