Free Order - District Court of Arizona - Arizona

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 The Court held a discovery conference call with the parties on May 11, 2006. Following the conference call, the Court reviewed the counterclaim in this case (Doc. #13) as well as memoranda previously filed by the parties regarding related discovery disputes (Docs. ##45, 46). 1. The Court ruled that Plaintiff may conduct an additional deposition of ) ) ) Plaintiff/Counterdefendant, ) ) vs. ) ) ) Daryush B. Motlagh and Jennifer ) Motlagh, husband and wife; John ) Edmonds and Jane Doe Edmonds, ) husband and wife; and Integrity Assurance, Inc., an Arizona corporation, ) ) Defendants/Counterclaimants. ) ) ) Century 21 Real Estate Corporation, No. CV-03-2353-PHX-DGC IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

ORDER

Defendant Daryush Motlagh. The deposition shall be limited to the counterclaims asserted against Plaintiff. 2. The Court informed the parties that it will permit Defendants to conduct an

already-noticed Rule 30(b)(6) deposition of Plaintiff after the discovery cut-off date of May 26, 2006, if the deposition cannot be scheduled before that date. The Court advised the parties, however, that the deposition must be completed before the due date for dispositive
Case 2:03-cv-02353-DGC Document 73 Filed 05/12/2006 Page 1 of 3

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

motions in this case. 3. The Court took under advisement the document production dispute between

the parties. During the conference call, the parties informed the Court that they disagreed on whether Plaintiff must respond to Defendants' Request for Production Nos. 2, 3, 4, 5, and 8. The Court previously ruled that Plaintiff need not respond to these requests because they relate to counterclaims in the case and, at the time, Defendants had no standing to assert the counterclaims. Doc. #47. Since that ruling, however, Defendants have acquired the counterclaims from the bankruptcy estate. The Court concludes that Request No. 2 is relevant to the issues in this case. That requests seeks documents that establish, explain, or interpret the standards of performance applied to Century 21 franchisees located in a specific portion of the West Valley from 1996 to the present. Plaintiff shall be required to respond to this request. Request Nos. 3, 4, and 5 seek information regarding the financial performance of other franchisees of Plaintiff. The Court has reviewed the counterclaims and cannot conclude that this information is relevant to any issue asserted in the counterclaims. Defendants assert in the counterclaims that Plaintiff has breached the covenant of good faith and fair dealing implied in Defendants' franchise agreement by denying Defendants the benefits, entitlements, support, and client referrals required by the franchise agreement; that Plaintiff has breached the franchise agreement by failing to provide Defendants with technical support, marketing advice, client referrals, and related advertising media and products; that Plaintiff has tortuously interfered with Defendants' prospective advantage by disclosing confidential information to a more favored franchisee, and causing Defendants to breach their contract so that the more favored franchisee could be given Defendants' franchise territory; and that Plaintiff is liable for unjust enrichment based on its denying Defendants access to its referral system and internet website, by diverting potential client referrals to a more favored broker in Goodyear, Arizona, and by having failed to earn the royalty fees paid by Defendants. These counterclaims assert that Plaintiff has engaged in various acts of wrongful conduct toward Defendants, and has provided benefits and
-2-

Case 2:03-cv-02353-DGC

Document 73

Filed 05/12/2006

Page 2 of 3

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

confidential financial information and client referrals to a more favored franchisee. Request Nos. 3, 4, and 5, which seek confidential financial information concerning the performance of other franchisees, is not relevant to these claims. The Court holds that Plaintiff need not respond to these requests. Request No. 8 seeks to discover all documents pertaining to the granting of a franchise to the owners of a particular business in Avondale, Arizona. Defendants allege that Plaintiff conspired with the owners of this business to destroy Defendants' franchise. This issue is raised in Defendants' Third and Fourth Counterclaims. The evidence thus appears to be relevant to claims asserted in this case, and Plaintiff will be required to respond to Request No. 8. DATED this 12th day of May, 2006.

-3-

Case 2:03-cv-02353-DGC

Document 73

Filed 05/12/2006

Page 3 of 3