United States District Court, N.D. Illinois
March 1, 2004.
CHRISTOPHER IOSELLO, Plaintiff,
VICTOR LAWRENCE, d/b/a, LEXINGTON LAW FIRM, Defendant
The opinion of the court was delivered by: MICHAEL MASON, Magistrate Judge
MEMORANDUM OPINION AND ORDER
On February 10, 2003, plaintiff, Christopher losello, filed a class
action suit against defendant, Lexington Law Firm, alleging violations of
the Credit Repair Organization Act ("CROA"), 15 U.S.C. § 1679. The
punitive class has not been certified and fact discovery was set to close
March 2, 2004. In a February 27, 2004 minute order, we extended fact
discovery to June 2, 2004. Before us are cross motions from the parties
regarding the proper scope of discovery. For the following reasons, we
grant in part and deny in part plaintiffs motion to compel and deny
defendant's motion for a protective order.
Plaintiff's motion to compel seeks responses to its first, second, and
third discovery requests. Plaintiff categorizes the information it seeks
to compel from its first discovery request as (1) class discovery, (2)
financial discovery, and (3) other issues. Its second discovery request
seeks letters defendant sent to various credit bureaus on behalf of
plaintiff and its other clients. Its third discovery request seeks a list
of all the
lawsuits defendant filed in the last five years. Defendant's motion for a
protective order only addresses plaintiffs first discovery request.*fn1
Defendant addresses the remaining two requests in its response to the
motion to compel.
First Discovery Request
Plaintiff seeks to compel (1) class discovery, (2) financial discovery,
and (3) other issues from its first discovery request. Under "class
discovery", plaintiff seeks the number of persons who contracted with
defendant*fn2, their identities, the identities of defendant's
employees, the amount of money it received from customers in the last
five years, and documents to support these requests. Plaintiff asserts
that it needs this information to determine whether there is a punitive
class and whether it should proceed with its class action claim.
Defendant objects, arguing that these requests seek privileged and
confidential information and are overbroad and burdensome.
The argument in defendant's motion for a protective order is two fold.
First defendant asserts that the "class discovery" plaintiff seeks
includes confidential proprietary information, like its client list and
revenue documents, which must be safeguarded from disclosure. Second,
defendant argues that plaintiff's counsel, not plaintiff, is a direct
competitor and therefore should be barred from accessing any of its
confidential proprietary information. Defendant concedes that
information is discoverable under most circumstances, because the
Court can safeguard its confidentiality by entering a protective order.
However, in this case, defendant contends that a protective order will
not safeguard the confidentiality of the information because protective
orders are designed to shield information from disclosure to parties and
non-parties not counsel. Defendant correctly states that a protective
order cannot prevent disclosure of the information to plaintiff's
counsel. However, defendant incorrectly concludes that it should not be
ordered to disclose its proprietary information.
As an initial matter, we find that the number of defendant's clients,
the identity of its employees, the amount of money it received from
customers in the last five years, and documents supporting such
information do not qualify as confidential proprietary information and
therefore, must be disclosed to plaintiff. Furthermore, even it this
information was confidential and proprietary, defendant has not presented
sufficient evidence to support its argument that plaintiff's counsel is a
direct competitor and that disclosure of the information to them would
harm defendant. However, we will error on the side of caution and
therefore, order the parties to enter into an appropriate protective
order to prevent the disclosure of this information to any non-parties
before defendant produces the information at issue. Plaintiffs motion to
compel is granted as to Requests to Admit 6 and 7, Interrogatories 2, 3,
and 5, and Document Request 17. Defendant's motion for a protective order
is denied as to those requests.
As for the identity of defendant's clients, Interrogatory 4, in
addition to arguing that such information is confidential, defendant also
argues that it is protected by the attorney/client privilege. We do not
agree. The general rule is that the identity of a client is not a
confidential communication within the attorney/client privilege. Amon
Harrison, 1993 U.S. Dist. LEXIS 1360 at *9 (N.D. Ill. Feb.
8, 1993). However, there are a limited number of exceptions, when the
attorney/client privilege can apply to the identity of a client. None of
those exceptions are present in this case. Therefore, plaintiff's motion
to compel a response to Interrogatory 4 is granted and defendant's motion
for a protective order is denied.
Next, plaintiff seeks to compel "financial discovery", which it argues
is relevant to its punitive damages claims. Specifically, plaintiff
requests information on defendant's net worth, supporting financial
statements, and any documents to support these requests. Defendant
objects on the grounds that plaintiff has not provided any evidence to
justify the awarding of punitive damages under CROA. Defendant's
arguments go to the merits of plaintiff's claim. However, at this stage
in the litigation plaintiff is merely required to properly plead a claim
for damages, not provide evidence to support that claim. Because
plaintiffs punitive damage claims are at least minimally viable, its
request for financial information is relevant. Whether the district court
actually decides to award punitive damages in this case is a separate
question, not presently before us. Therefore, plaintiff motion to compel
response to Interrogatories 8, 9, and 11 and Document Requests 14, 15,
and 16 is granted and defendant's protective order is denied as to this
Finally, plaintiff seeks to compel documents relating to "other
issues." Plaintiff alleges that defendant has refuses to turnover
documents that it previously agreed to produce. Specifically, plaintiff
seeks more complete responses to Document Requests 3, 4 and 12 and
Interrogatories 5 and 7. To the extent defendant has any responsive
information that it has not disclosed, it is ordered to do so. We agree
that Interrogatory 7 is vague and therefore, defendant is not ordered to
respond to it.
Second Discovery Request
Plaintiff's second discovery request seeks (1) all letters sent on
behalf of plaintiff and (2) copies of all form letters defendant has sent
on behalf of all of its clients. Defendant's response to the first
request listed the date and subject matter of each letter sent on behalf
of plaintiff, but stated that it could not produce the actual letters
because defendant has a "paper-less" office. To the extent defendant has
any copies of the letters sent on behalf of plaintiff, whether in paper
or electronic form, it is ordered to produce them.
Defendant objects to the second request, copies of every form letter
sent on behalf of all its clients, arguing that they are confidential
commercial information. Defendant also characterizes the form letters as
trade secrets and work product, without any citations to case law.
Because both sides provided cursory briefing on this issue, we will not
determine whether the form letters qualify as trade secrets or work
product at this time. However, we do believe that, at the very least, the
form letters contain defendant's confidential proprietary information.
Therefore, we will not compel their disclosure at this time.
Third Discovery Request
Plaintiff's third discovery request seeks a list of all the lawsuits
defendant has filed in the last five years. Defendant objects, stating
that this information is not relevant, is overbroad and unduly
burdensome, is redundant and repetitive of previous discovery requests,
and can be retrieved as easily by plaintiff as by defendant. Defendant
that it does not have this information readily available and would
have to contact each individual court that it has appeared before in the
last five years, a task that can just as easily be done by plaintiff.
We find it hard to believe that defendant does not have a list of
current and former cases somewhere in its office. Moreover, creating such
a list should not require defendant to call each court that it has
appeared before in the past five years, as plaintiff would be required to
do. Based on information within its office, defendant should, without
much time and effort, be able to create a list with the name, case
number, venue, and claims asserted for each case that it has filed in the
past five years. Therefore, plaintiff's motion to compel a response to
its third discovery request is granted.
Plaintiffs motion to compel is granted in part and denied in part.
Defendant's motion for a protective order is denied. Any discovery
requests that plaintiff has been ordered to modify must be provided to
defendant by March 5, 2004. Defendant is ordered to produce any
outstanding discovery addressed in this opinion by March 20, 2004.
Defendant is also ordered to brief the issue of why its form letters
qualify as work product or trade secrets by March 12, 2004. Plaintiff's
response is due by March 19, 2004. Defendant's reply, if necessary, is
due by March 26, 2004. It is so ordered.