The Solaria Corporation v. GCL System Integration Technology Co., Ltd.

Background

Solaria sued GCL for breach of contract based on alleged nonpayment. GCL denied liability and asserted several defenses. Solaria served two interrogatories. The first asked GCL to state the facts and explain why each of eight identified payments was not owed, and to identify related documents. The second asked GCL to state the facts and detailed bases for each defense to Solaria’s breach-of-contract claim and to identify supporting documents.

GCL objected to both interrogatories. For the first, GCL stated that four of the eight payment amounts were not due or owing and that three other amounts were duplicative, but it did not comment on the eighth amount. For the second, GCL referred Solaria to its responses to document requests. Solaria asked the court to order more complete answers.

Court’s analysis

The court accepted GCL’s literal reading of the first interrogatory: GCL was required to provide facts and explanations only if it contended that a payment was not owed. Based on that reading, the court understood GCL not to be disputing that it owed the four payments at issue. If that was not GCL’s position, the court ordered GCL to supplement its response and clarify its position. The court also directed GCL to identify all documents supporting any contention that it did not owe a particular payment.

As to the second interrogatory, the court rejected GCL’s argument that the interrogatory’s subparts necessarily exceeded the presumptive 25-interrogatory limit under Federal Rule of Civil Procedure 33. The court explained that each defense based on a distinct legal theory and distinct facts counts as a separate interrogatory. The court found that the first interrogatory could reasonably be treated as no more than eight interrogatories, one for each payment, and found no basis to conclude that Solaria had exceeded the limit.

The court also rejected GCL’s arguments that the second interrogatory was improper because it asked for all facts and all bases for its defenses, or because document identification duplicated Solaria’s document requests. The court stated that requiring a detailed narrative of GCL’s entire defense case and a list of every related document would be too burdensome. But it found it reasonable to require GCL to identify its defenses, state the factual bases for those defenses, and identify documents supporting them.

Disposition

The court ordered GCL to supplement its responses to both interrogatories. For the second interrogatory, the supplemental answer had to identify each defense GCL asserted to Solaria’s breach-of-contract claim, describe the factual basis for each defense, and identify the documents supporting each defense. The supplemental responses were due June 4, 2021, unless the parties agreed to a different date. Judge Virginia K. DeMarchi resolved the discovery dispute without a hearing; the order did not decide the merits of Solaria’s contract claim.