Transcript of Proceedings held on October 7,2020, before Magistrate Judge Donna M. Ryu.… — Plaid Privacy (Dkt. 104)

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U.S. District Court for the Northern District of California · No. 4:20-cv-03056-DMR · Doc. 104 · 2020-10-27 · Docket on CourtListener

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UNITED STATES DISTRICT COURT 
NORTHERN DISTRICT OF CALIFORNIA 
Before The Honorable DONNA M. RYU, Magistrate Judge 
 
IN RE: PLAID, INC.
 
)    NO. C-20-3056 DMR 
PRIVACY LITIGATION,         ) 
____________________________)
WEDNESDAY, OCTOBER 7, 2020 
OAKLAND, CALIFORNIA          
 
INITIAL CASE MANAGEMENT 
    CONFERENCE 
 
TRANSCRIPT OF ZOOM PROCEEDINGS OF THE OFFICIAL ELECTRONIC SOUND 
RECORDING - 1:32 P.M. - 1:48 P.M. 
 
APPEARANCES: 
 
For Plaintiffs:         Herrera Prudy LLP 
                        4590 MacArthur Boulevard, Suite 500 
                        Newport Beach, California 92660 
                   BY:  Shawn M. Kennedy, Esquire 
 
Lieff Cabraser Heimann & Bernstein 
250 Hudson Street, 8th Floor 
New York, New York 10013 
               BY: Rachel Beman, Esquire 
 
Lieff Cabraser Heimann & Bernstein 
275 Battery Street 29th Floor 
San Francisco, California 94111 
               BY: Melissa Gardner, Esquire 
 
(Appearances Continued) 
 
Reported By:            Diane E. Skillman, Transcriber 
 
 
Case 4:20-cv-03056-DMR     Document 104     Filed 10/27/20     Page 1 of 14

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FOR DEFENDANT:          Gibson, Dunn & Crutcher 
                        555 Mission Street, Suite 3000 
                        San Francisco, California 94105 
                   BY:  Ethan Dettmer, Esquire 
 
 
 
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Wednesday, October 7, 2020               
1:32 p.m. 
Z O O M  P R O C E E D I N G S 
o0o 
THE COURT:  Okay.  So, Ms. Garcia, go ahead and call
the case.
THE CLERK:  Yes, Your Honor.  This court is now in
session.  The Honorable Donna M. Ryu presiding.  
Calling Civil Case C-20-3056 DMR In Re Plaid Incorporated
Privacy Litigation.  
Counsel, please state your appearances starting with
plaintiffs' attorneys first.
MS. GEMAN:  Good afternoon, Your Honor.  Rachel
Geman, Lieff Cabraser for plaintiffs.
THE COURT:  Good afternoon.
MS. GARDNER:  Good afternoon.  Melissa Gardner, Lieff
Cabraser for the plaintiffs.
MR. KENNEDY:  Good afternoon, Your Honor.  Shawn
Kennedy of Herrera Purdy for the plaintiffs.
THE COURT:  All right.  Good afternoon.
MR. DETTMER:  Hello, Your Honor.  Ethan Dettmer from
Gibson Dunn on behalf of Plaid.
THE COURT:  Good afternoon to you as well.
All right.  I want to start by asking you about amendments
of parties.  Do the plaintiffs intend to add any parties,
any -- other than those that might be added as substitute
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named plaintiffs if that becomes necessary along the way?
MR. KENNEDY:  No, Your Honor.  We do not intend at
this point to add any new parties.
THE COURT:  Okay.  Mr. Dettmer, does your client
intend to add any parties?
(Pause in the proceedings.) 
THE COURT:  For some reason I wasn't able to hear
you.
MR. DETTMER:  I'm sorry, can you hear me now?
THE COURT:  Perfect.  Thank you.
MR. DETTMER:  No, Your Honor, we do not have any
intention of adding any new parties.
THE COURT:  Okay.  So my ruling now is that no
parties may be added going forward except that plaintiff may
seek leave to add a substitute named plaintiff or plaintiffs,
if necessary, along the way.
Let's talk about ADR.  Plaintiffs suggested private
mediation.  Plaid said possibly private mediation, and neither
side told me when you think that would be appropriate.  So, I
just want to at least get your initial views on this.
Who wants to speak for the plaintiff -- plaintiffs?
MR. KENNEDY:  I can speak for the plaintiffs, Your
Honor.  
Our position is, it's premature at this point.  Maybe
perhaps after the Court rules on the pending motion to dismiss
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and we get into some discovery.  After that -- maybe after
discovery closes.  There's probably a point which it makes
sense, but probably not right now.
THE COURT:  Okay.  Well, I guess I am asking you when
you think that point might be.  Would it be after the close of
discovery or after ruling on the motions -- the pending --
sort of the pleading motion or motions, depending on how that
goes, or after, before class cert?  
What are your views at this time?
MR. KENNEDY:  Without knowing how discovery will go,
probably after the close of discovery.
THE COURT:  Okay.  Mr. Dettmer, what do you think on
your end?
MR. DETTMER:  Thanks, Your Honor.
I think we want to be, obviously, pragmatic about this.
So I think it really depends on, for instance, the ruling on
the motion to dismiss, you know, depending on what happens
with that.  That may be a real opportune time for a private
mediation.
It may be that it will take a little bit longer.
Obviously, we made a proposal on discovery.  And if that -- if
Your Honor adopts that proposal, that may also provide a real
opportune time for a private mediation after that process is
done.
You know, our view is that we just want to be practical
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about it.  And as Your Honor knows, obviously the lawyers on
the call know, in litigation like this, there are, you know,
points of the case where private mediation really makes sense
and we obviously are going to be very willing to engage when
it does makes sense.  
I think those are sort of the points at which it looks
like it's certainly a possibility that that would be a good
time for mediation.
THE COURT:  Mr. Dettmer, does your client also think
that private mediation is the right process --
MR. DETTMER:  Probably, yes.
THE COURT:  Okay.
Then let's turn to discovery.  So I already denied the
discovery stay that was requested by Plaid, and the case is
going to move forward.
And, Mr. Dettmer, I will allow you to have your say on
this to tell me what you want to tell me.  But I did read
everything, and I would not be inclined to impose what I think
of as artificial limits on how discovery goes forward as
suggested by Plaid.  I think there's no reason to deviate from
the norm here.  
After Dukes, we really -- you know, we need to get fulsome
discovery for class cert and other things.  I think it is not
necessarily efficient to limit things in the way that you are
suggesting in order to get some kind of early Rule 56,
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particularly because I don't, you know -- like most judges on
this bench, I don't do more than one Rule 56 unless there's a
really good reason, and I don't think this is really suitable
for that.
But you stated in your papers that you felt like
plaintiffs put in some legal argument at the last minute that
didn't seem particularly fair to your client, so I wanted to
give you the opportunity to fill that out if you want and tell
me what you think.
MR. DETTMER:  Sure.  I appreciate, Your Honor, both
the opportunity and also giving me an indication of where your
leanings are.  I appreciate that.
So let me explain why -- I understand, obviously, that
this is not the usual course.  But I would note to you that
this is really not the usual case.  And what's really unusual
about this case, in my view, is two particular things.
One is, we have 11 plaintiffs and not one of those
plaintiffs has actually alleged in the complaint that he or
she interacted with Plaid.  They say they had dealings
consistent with what's alleged in the complaint, but none of
them come out and say, I used Plaid services.  
Second, not one of the plaintiff says in the complaint
that they suffered any kind of concrete actual injury or harm
because of what Plaid did or didn't do.
And the reason for our submission, our proposal is, that
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those two really critical fundamental facts, do we have a
plaintiff here who had dealings with the defendant, is, seems
to me, something that really ought to be resolved before you
start engaging in expensive and what looks to be very
contentious discovery.
Your Honor obviously knows that Rule 1 says we should have
just, speedy, and inexpensive resolution of matters and
Rule 26 explicitly gives Your Honor this tool of phasing --
or, you know, focused and limited discovery at the outset in
order to carry out that Rule 1, you know, goal.
And I think for three reasons what we have proposed here
really does make that tool particularly apt in this case.
Those three reasons are:  
One, I think this sort of focused and limited discovery
can get accomplished in a pretty short time period.  If it
turns out we are wrong, and you get this sort of limited and
focused rule against us on a limited or focused summary
judgment or summary adjudication, then there will be time to
have the sort of full discovery that the plaintiffs want.
However, given that they haven't even alleged it, alleged
interactions with Plaid, we think that resolving that critical
issue of, is there really a plaintiff in this case who
interacted with the defendant, should be resolved first.  
The second reason is, and we just have to look at pages 9
and 10 of the Rule 26 report to see the plaintiffs appear to
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be looking to take a real scorched-earth approach to discovery
here.  They are suggesting on those pages that they want to
take discovery of pretty much everything having to do with
Plaid since 2012.  They look really broad, and I anticipate
that that will be very contentious, and it could end up being
very time-consuming and expensive.
The third reason is, I do think that this plan is
manageable.  These are two really kind of narrow issues that
we can focus on, get focused discovery, focused documents,
focused depositions, and get these focused Rule 56 motions on
file and decided quickly.
So I understand where Your Honor is coming from that this
is unusual, but given the state of the pleadings, I think this
really is an unusual case given those facts.
Happy to answer questions, obviously.
THE COURT:  I understand what you're saying about
this.  But I don't think that the proposed method is
necessarily consistent with Rule 1 being, you know, just and
efficient.  It might be inexpensive for one side, but I don't
think that that plan is going to map well on this case.
And the points that you raise are good, and they are going
to be vetted, at least initially through the crucible of your
motion, your points about whether there's injury and whether
the pleadings are sufficient.  So we will find that out.
But that's the normal way we do that, so I'm not going to
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put, as I said, any artificial limits on discovery at this
juncture.  I don't see a reason to do that.
So I would like you to go ahead and meet and confer on a
protective order using one of the models from our District as
your template.  I'm assuming it's the one that's for patent
cases that has more levels of protection, but that's really up
to you to figure out between yourselves whether that is the
appropriate one.
So submit a proposed protective order by the end of the
month, by October 30th.  And if you can't agree, then make
sure that you submit your competing proposals in a way that's
easiest for me to understand where your differences are.
So what I think that looks like is -- well, number one, I
would love to have you submit one that you all agree on, but
if that is not possible, each of you should do a redline using
the model that you're working off of because the model is
presumptively good.  All right?
Then do a separate document that you are going to do in
the form of a joint chart where you have side by side your
competing language on whatever the particular dispute is.  The
language and then your arguments so I can see them together
and understand, instead of having to flip through lots and
lots of pages to get at the fundamental difference between
your proposals.  Okay?  So that will happen by the end of the
month.
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I think for the case schedule, I know the plaintiffs
wanted me to go ahead and issue a trial schedule, and I think
it's too early.  I do often set one early on in the case, and
I think that what I would like to do here is at least get
through the first round of the challenge to the pleadings, and
we'll see where we are; whether Mr. Dettmer's client has a
good argument.  If so, whether there's room to amend or not.
I think I'll know a lot by the end of that.  But if there's
things going forward, then at that point I would probably set
a schedule, just so you all know.  Okay?
So I would like to have you back for your next CMC on
February 3rd at 1:30, with your joint updated papers due
January 27th, 2021.  I will likely see you before then because
I'm going to assume I'll need a hearing on your motion to
dismiss.  But if for some reason I don't need a hearing, then
I won't have one.  My default is generally, you know, give
folks a chance to argue in oral argument.  Okay?
So, that's what I've got on my end.  Is there anything
else that the plaintiffs want to talk about today?
MS. GEMAN:  Your Honor, Rachel Geman.  Can I ask a
clarifying question?
Would you like those hopefully agreed, but perhaps
competing protective orders submitted to your deputy via email
or served on ECF?
THE COURT:  Filed on ECF.  Okay?  
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Because it will be a -- sort of a disputed motion for a
protective order.  I am assuming everybody thinks a protective
order is necessary, just, you know, maybe won't agree on every
term and need me to sort some things out.  Although my strong
preference and what usually happens, folks, is that you are
able to reach compromises that make sense.
And I want us to get off on the right foot here.  And I
will decide any, what I call, honest disputes, which means
that you all are very experienced lawyers.  You know our
practices here.  We expect that you work really hard to reach
reasonable compromises knowing what, in many of the areas,
what a likely outcome would be.
So that includes what Mr. Dettmer pointed out in your CMC
statement.  Mr. Dettmer said, boy, these topics are really,
really broad.  I didn't drill down to see exactly how broad
they are, honestly.  Subject matter, I don't know how it is
going to map on to, for example, temporal scope and those type
of things.  
Yeah, you will have to go through some serious meet and
confer to try and narrow down what is relevant and
proportional to the claims.  And a lot of that is going to
happen on your end.  I am here to handle those that really
nobody could fairly compromise on.  And so, you know, bring
those to my attention.  But nothing short of that.  Okay?
All right?  So, Ms. Geman, anything more from the
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plaintiffs' side?
MS. GEMAN:  I'm looking at my colleagues.  I don't
have anything and it appears that neither Mr. Kennedy nor
Ms. Gardner does.
Thank you, Your Honor.
THE COURT:  Okay.  Mr. Dettmer, anything from Plaid?
MR. DETTMER:  No, Your Honor.  Thank you.
THE COURT:  All right.  Great.  Thank you very much.
I look forward to reading your motion papers.
MR. DETTMER:  Thank you.
MR. KENNEDY:  Thank you.
MS. GEMAN:  Thank you.
THE COURT:  We are concluded on this matter.
(Proceedings adjourned at 1:48 p.m.) 
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Case 4:20-cv-03056-DMR     Document 104     Filed 10/27/20     Page 13 of 14

CERTIFICATE OF TRANSCRIBER 
I certify that the foregoing is a true and correct
transcript, to the best of my ability, of the above pages of
the official electronic sound recording provided to me by the
U.S. District court, northern district of california, of the
proceedings taken on the date and time previously stated in
the above matter.
I further certify that I am neither counsel for, related
to, nor employed by any of the parties to the action in which
this hearing was taken; and, further, that I am not
financially nor otherwise interested in the outcome of the
action.
________________________________ 
Diane E. Skillman, Transcriber 
Friday, October 23, 2020 
Case 4:20-cv-03056-DMR     Document 104     Filed 10/27/20     Page 14 of 14

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