GCCA, LLC v. MACCG LLC

Background

GCCA, LLC and MACCG LLC both operate Greek restaurants using the TAVERNA KYCLADES mark, which GCCA registered in 2014. GCCA alleged that, after a business dispute, it withdrew MACCG’s permission to use the mark but MACCG continued using it. MACCG counterclaimed for a declaration that it did not infringe the mark and for cancellation of GCCA’s registration. MACCG also alleged that it acquired rights to the mark or received an implied license as part of an oral business arrangement.

GCCA served a subpoena on non-party Investors Bank seeking records concerning MACCG’s bank accounts from 2013 through the present, including records concerning debit cards and safe-deposit boxes. GCCA argued that the records were relevant to the parties’ claims and defenses because MACCG’s finances could bear on the alleged transfer or license of the mark and on damages. The opinion states that trademark owners may recover an infringer’s profits if infringement is proven.

Arguments and analysis

MACCG moved to quash the subpoena, arguing that the requested information was unrelated to the litigation. It also argued that relevant financial information had already been produced through K-1 statements, W-2 forms, and some unaudited profit-and-loss statements. The court rejected that argument, explaining that GCCA did not have to limit its financial discovery to the documents MACCG selected or accept those documents at face value. The court also noted that the existing materials did not necessarily show MACCG’s revenues, expenses, or profits for all relevant years.

Under Federal Rule of Civil Procedure 26(b)(1), discovery may seek nonprivileged information relevant to a claim or defense and proportional to the needs of the case. The court concluded that, in broad outline, the financial information sought from Investors Bank met that standard. The court also rejected MACCG’s confidentiality argument because MACCG offered only general assertions of sensitivity and did not identify a specific, serious harm. The parties’ stipulated protective order allowed discovery materials to be designated confidential or, when warranted, for attorneys’ eyes only.

The court nevertheless found the subpoena overbroad. It identified the request for information about any MACCG safe-deposit box—including who opened it and who had access—as lacking a non-speculative basis for relevance. The court also found other specified subpoena requests beyond the proper scope of discovery, while allowing production of monthly statements for debit cards issued against MACCG’s Investors Bank accounts.

Ruling

The court ordered that the subpoena be modified to seek only the documents listed in paragraphs 1(a)–(c), 2, 3, 4, 6—limited to monthly statements for debit cards issued against MACCG’s Investors Bank accounts—and 7 of Schedule A. In all other respects, Magistrate Judge Barbara Moses denied MACCG’s motion to quash.