GMO Gamecenter USA, Inc. v. Whinstone US, Inc.
- John Cronan
- 1:22-cv-05974
- U.S. District Court · Southern District of New York
- 13
In GMO Gamecenter v. Whinstone, Judge Parker narrowed letters rogatory discovery, denied the remainder of Northern Data’s motion, and required revised requests.
Non-party Northern Data AG and Aroosh Thillainathan must comply with the narrowed discovery requests; GMO and Whinstone must submit revised letters rogatory.
What happened
GMO Gamecenter USA, Inc. v. Whinstone US, Inc. concerns discovery from non-parties Northern Data AG and Aroosh Thillainathan in a contract dispute involving cryptocurrency-mining facilities and services. The court had issued requests for assistance to a German court to obtain documents and testimony.
Northern Data and Thillainathan asked the court to cancel or limit those requests, arguing that GMO’s requests were too broad and burdensome. Thillainathan also argued that, as a senior executive, he should not have to give live testimony. GMO later narrowed its requests.
Judge Katharine H. Parker granted the motion to cancel or obtain a protective order insofar as the court narrowed the information that could be sought, but otherwise denied it. Thillainathan must answer the permitted deposition questions, subject to attorney-client privilege, and the parties must submit revised requests within 14 days.
The detailed version
- GMO Gamecenter USA, Inc. v. Whinstone US, Inc. · No. 1:22-cv-05974
- John Cronan
- Aug. 14, 2024
Background
GMO Gamecenter USA, Inc. and GMO Internet, Inc. sued Whinstone US, Corporation over alleged breaches of agreements concerning cryptocurrency-mining facilities and related services. The dispute involves a Louisiana agreement and a later Texas agreement. The parties assert competing claims about construction delays, available power, hosting fees, lost profits, equipment, and other contractual obligations.
Discovery was ongoing. GMO and Whinstone sought information from non-party Northern Data AG and its CEO, Aroosh Thillainathan. The court had issued letters rogatory—formal requests for assistance from a foreign court—to obtain documents and Thillainathan’s deposition testimony. Northern Data and Thillainathan asked the court to vacate or modify those requests, arguing that the requests exceeded the proper scope of discovery and imposed undue burdens. Thillainathan also objected to a live deposition under the “apex doctrine,” which provides additional protection to senior corporate executives in some circumstances.
Court’s analysis
The court treated Northern Data’s motion as a request for a protective order under Federal Rule of Civil Procedure 26(c), rather than as a motion to correct a clerical mistake under Rule 60. Discovery must concern nonprivileged information relevant to a claim or defense and proportional to the needs of the case. The court may limit discovery when it is cumulative, duplicative, or more burdensome than beneficial.
The court declined to cancel the order permitting Thillainathan’s deposition. It found that he had direct personal knowledge because he signed and participated in negotiating the Texas agreement. Thillainathan had not submitted a declaration explaining why live testimony would burden him or identifying other witnesses who were more involved. The court also rejected the argument that the parties had to depose other witnesses first, noting that his testimony would remain necessary and that further delay would prolong discovery.
The court reviewed Whinstone’s narrowed deposition questions and found them relevant and proportional. Thillainathan must answer those questions and related follow-up questions. However, he does not have to describe attorney-client communications in response to question 6(a).
The court also found that GMO’s document requests were properly directed to Northern Data and Thillainathan because Northern Data retained control of a server containing some of Thillainathan’s emails, and Whinstone could not access all of those emails through its own records. The court found GMO’s narrowed requests sufficiently limited because they sought communications containing the term “GMO,” covered a limited period, and concerned only Thillainathan as a custodian.
Disposition
The court held that the motion to vacate and/or for a protective order was granted insofar as the court narrowed the information that could be sought through the letters rogatory, but was otherwise denied. The parties must submit a revised request for international judicial assistance under the Hague Convention within 14 days. The clerk was directed to terminate the motion at ECF No. 150.
Read the full 13-page opinion on CourtListener, the free public archive maintained by the Free Law Project.