Om Records, LLC v. OM Developpement, SAS

Background

Om Records, LLC alleged that defendants violated Section 43(a) of the Lanham Act, California Business and Professions Code section 17200, and common-law rights by launching a label called “OM Records.” The defendants included OM Developpement, SAS; Olympique de Marseille, SASP; BMG Rights Management (France), SARL; and BMG Rights Management (US), LLC.

The French Defendants moved to dismiss for lack of personal jurisdiction. All defendants moved to dismiss for failure to state a claim and on the ground that another forum would be more appropriate. Om Records opposed those motions and alternatively requested 90 days of jurisdictional discovery.

While the dismissal motions were pending, Om Records served 84 document requests on each of the OM Defendants and 79 document requests on BMG France. It also noticed video depositions of François Vesval, legal counsel for Olympique de Marseille, and Claire Hindermeyer-Cayez, BMG France’s Director of Business and Legal Affairs. Both had submitted declarations supporting personal-jurisdiction challenges.

Protective-order standard

Federal Rule of Civil Procedure 26(c) allows a court, for good cause, to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense. Possible protections include forbidding discovery or setting terms for how discovery will occur.

For a request to stay discovery while potentially dispositive motions are pending, the court considered whether the motions could dispose of the entire case or the issue targeted by discovery, and whether the motions could be decided without additional discovery.

Court’s analysis

The court found that the first requirement was satisfied because defendants’ motions sought dismissal of the First Amended Complaint in its entirety. The court also noted that the French Defendants sought dismissal for lack of personal jurisdiction. The court expressly did not decide the merits of those arguments, but concluded that they could potentially dispose of the entire case.

The court found that the second requirement was also satisfied. Om Records did not argue that the dismissal motions could not be resolved without further discovery. Based on its preliminary review of the motions and supporting materials, the court concluded that no additional discovery was needed to resolve them.

The court further found that defendants had shown prejudice from proceeding with discovery. In particular, the requests could require the French Defendants to risk violating French or European Union law before the court determined whether they were subject to its jurisdiction. The requests could also impose avoidable expense because of their volume. By contrast, Om Records had not shown that a temporary stay would prejudice it. Any jurisdictional discovery could later be limited by the court if authorized.

Disposition

The court granted defendants’ Joint Motion for a Protective Order. It ordered that discovery be stayed pending the court’s resolution of defendants’ pending motions to dismiss. The opinion did not rule on those motions or decide the underlying trademark and unfair-competition claims.