Lynwood Investments CY Limited v. Konovalov

Background

The plaintiff’s sole claim is a copyright claim concerning NGINX Plus software code. The plaintiff alleges that defendants developed the code while employed by Rambler Internet Holding LLC and that Rambler owned the code as a work made for hire before assigning its interest to the plaintiff. Netflix was the first customer of the defendants’ NGINX business and received custom NGINX content-delivery-network add-ons that the plaintiff alleges became part of NGINX Plus.

The court had previously limited initial fact discovery to whether NGINX Plus code was written by defendant Igor Sysoev or other former Rambler employees during their employment by Rambler before the end of 2011. The court clarified that documents created after 2011 could still fall within that scope if they concerned whether the code was developed before the end of 2011.

The plaintiff served Netflix with a subpoena containing 31 document requests. Netflix objected that the subpoena was unduly burdensome, premature, and partly outside the permitted discovery period. The plaintiff moved to compel compliance.

Court’s analysis

Federal Rule of Civil Procedure 45 governs subpoenas to non-parties, and its discovery scope is the same as the scope under Rule 26(b). Discovery must concern nonprivileged information relevant to a claim or defense and proportional to the needs of the case. Courts also balance the requesting party’s need and the relevance of the information against the burden on the non-party.

The court found that the plaintiff had shown a sufficient need for source code provided by the defendants to Netflix. Code developed for Netflix in 2010 and 2011 was directly relevant to the copyright claim. The court also found that discovery concerning Netflix’s Open Connect system could be relevant because the plaintiff presented information indicating that the system included additional NGINX modules and might have used NGINX Plus code developed before the end of 2011.

The court further found that Netflix’s source code could fill a gap in the defendants’ own records. The plaintiff alleged that defendants removed or destroyed information from Rambler’s equipment. Evidence submitted by the plaintiff explained that repository commit dates and author information can be manipulated, that code may be written before being added to a repository, and that code may be moved without preserving its history. Based on those allegations and evidence, the court found a legitimate reason to believe Netflix’s source code could differ from, or reveal omissions in, the source code in the defendants’ repository.

The court balanced that need against Netflix’s burden. Netflix submitted a declaration describing practical difficulties in accessing the source code, but did not argue that locating the responsive code was infeasible or identify the time and cost of collecting and producing it. The court therefore allowed discovery of NGINX Plus source code provided by the defendants to Netflix, to the extent it reflects NGINX Plus code developed before the end of 2011. The parties were also directed to discuss whether cost-sharing would be appropriate.

The court reached a different conclusion regarding the remaining requests. Many sought all documents and communications concerning broad subjects, including agreements, work product, services, software design and development, and consulting or development services. The court found that these requests could encompass materials unrelated to the NGINX Plus code and were disproportionate to the needs of the case. The plaintiff also had not identified a specific gap in the defendants’ production that Netflix’s records would fill.

Disposition

The court GRANTED IN PART and DENIED IN PART the plaintiff’s motion to compel. Netflix was ordered to produce the requested NGINX Plus-related source code within 45 days of the order, under a protective order if needed. The court DENIED the motion to compel as to all other document requests and ordered the parties to meet and confer to narrow those requests.

The opinion text supplied with the order lists Maxine Chesney as the judge, while the order is signed “A. Westmore, United States Magistrate Judge.”