Capture Eleven LLC v. Otter Products, LLC et al

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge Charlotte N. Sweeney
Civil Action No. 1:20-cv-02551-CNS-KLM
consolidated with 1:21-cv-00068-CNS-KLM
THE CAPTURE ELEVEN GROUP, a California corporation,
Plaintiff/Counter-Defendant,
v.
OTTER PRODUCTS, LLC, a Colorado limited liability company,
Defendant/Counter-Plaintiff/Cross-Claimant,
v.
VERITY HOSKINS PRODUCTION, INC.,
Third-Party Defendant.
ORDER
Before the Court is Defendant’s Motion to Strike Contentions and Related Evidence Not
Disclosed in Fact Discovery (ECF No. 141). For the following reasons, the Court DENIES the
motion.
I. BACKGROUND
On October 21, 2020, Capture Eleven served its initial disclosures pursuant to Fed. R. Civ.
P. 26(a)(1)(A) (see ECF No. 141-10). In a section entitled “Documents Plaintiff May Use to
Support its Claims,” Capture Eleven listed “[a]ll records previously exchanged between the parties
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in the prior District of Colorado lawsuit”1 (id. at 5). Six days later, on October 27, 2020, Capture
Eleven filed its First Amended Complaint; Exhibit K to the complaint included copies of the
majority of the accused images and infringing uses underlying Capture Eleven’s suit (see ECF
Nos. 23, 23-15).
Later, Otter propounded its first requests for production (RFPs), including RFP No. 17:
All documents, other than those produced in response to any of the
foregoing requests and those produced as part of Plaintiff’s initial
disclosures, on which Plaintiff intends to rely in connection with this
lawsuit.
(ECF No. 141-6 at 11). On December 21, 2020, Capture Eleven responded to RFP No. 17 with
boilerplate objections—i.e., that the documents were privileged, the request was “premature,” and
the request failed to “describe with reasonable particularity the item or category of items to be
inspected” (id.).
On February 20, 2021, Otter further propounded its second set of interrogatories, including
Interrogatory No. 10:
For each Accused Image that Plaintiff asserts Defendants have
infringed a copyright or used outside the scope of an implied license,
identify and describe each use Defendants were permitted to make
that would not infringe Plaintiff’s rights or the scope of an implied
license, 	including 	a 	table 	listing 	each 	Accused 	Image, 	an
identification of the permitted uses of each such Accused Image and
non-permitted uses of each such Accused Image.
(ECF No. 141-5 at 10). On March 19, 2021, Capture Eleven served its answers and objections; for
Interrogatory No. 10, Capture Eleven listed 7 accused images, for which it identified 18 permitted
uses and 15 non-permitted uses (id. at 12–15).
1 This disclosure apparently refers to the parties’ former lawsuit voluntarily dismissed in 2019. See No. 1:18-cv-01724-
CMA-NYW.
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On November 14, 2022, Capture Eleven disclosed the report of its damages expert, Dr.
David Drews, which indicated that Capture Eleven was seeking damages related to 92 allegedly
unauthorized uses of its images (see ECF No. 142). Otter alleges that during fact discovery,
Capture Eleven never supplemented its initial Rule 26 disclosures, nor did it supplement its
responses to RFP No. 17 and Interrogatory No. 10, to reflect the full scope of the accused images
and non-permitted uses for which it now seeks damages (see ECF No. 141 at 2–3, 5–6). Otter filed
the instant motion, seeking under Fed. R. Civ. P. 26(e) and 37(c)(1) to strike any accused images
and non-permitted uses that were belatedly disclosed.
II. LEGAL STANDARD
Under Rule 26(e), a party who either has made a mandatory Rule 26(a) disclosure, or has
responded to an interrogatory, request for production, or request for admission, must timely
supplement or correct its disclosure or response “if the party learns that in some material respect
the disclosure or response is incomplete or incorrect, and if the additional or corrective information
has not otherwise been made known to the other parties during the discovery process or in writing.”
Fed. R. Civ. P. 26(e)(1)(A). “Information is ‘incomplete or incorrect’ in ‘some material respect’ if
there is an objectively reasonable likelihood that the additional or corrective information could
substantially affect or alter the opposing party’s discovery plan or trial preparation.” Gallegos v.
Swift & Co., No. 04-cv-01295-LTB-CBS, 2007 WL 214416, at *2 (quoting Sender v. Mann, 225
F.R.D. 645, 654 (D. Colo. 2004)). “ A key policy goal of requiring parties to keep their disclosures
current is ‘to avoid trial by ambush.’” Id. (quoting Macaulay v. Anas, 321 F.3d 45, 50 (1st
Cir.2003)).
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Under Rule 37(c)(1), if a party fails to supplement material information per the
requirements of Rule 26(e), the party may not use that information to supply evidence at trial
unless the failure to disclose was substantially justified or harmless. Fed. R. Civ. P. 37(c)(1). The
Court has broad discretion in determining whether the Rule 26 violation was substantially justified
or harmless, and the court need not make explicit findings on this issue. Woodworker’s Supply,
Inc. v. Principal Mut. Life Ins. Co., 170 F.3d 985, 993 (10th Cir. 1999) (citations omitted). When
exercising its discretion, the Court looks to several factors: “(1) the prejudice and surprise to the
party against whom the testimony is offered; (2) the ability of the party to cure the prejudice;
(3) the extent to which introducing such testimony would disrupt the trial; and (4) the moving
party’s bad faith or willfulness.” Id. “A trial court has considerable discretion to determine an
appropriate sanction under Rule 37 and the particular circumstances of a given case.” Cartel Asset
Mgmt. v. Ocwen Fin. Corp., No. 01-CV-01644-REB-CBS, 2010 WL 502721, at *17 (D. Colo.
Feb. 8, 2010) (citation omitted).
III. ANALYSIS
For substantially the reasons Capture Eleven sets forth in its response, the Court finds that
Capture Eleven did not fail to disclose the accused images and non-permitted uses relied upon by
Dr. Drews in his report. In particular, the Court agrees with Capture Eleven that throughout the
course of fact discovery, Otter was repeatedly placed on notice of its alleged infringing uses.
During a discovery dispute hearing on April 8, 2021, for instance, the parties and the Court
engaged in an extended discussion regarding the scope of Capture Eleven’s infringement
allegations, including specifically how many accused images and non-permitted uses were at issue
in the case (see ECF No. 87 at 19–37). Counsel for Otter represented that only approximately 5–7
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images identified in the First Amended Complaint were at issue (see id. at 19:16–20, 31:16–18).
In response, counsel for Capture Eleven stated that all of its copyright-registered images are
alleged to have been infringed, which amounts to approximately 50–60 images (see id. at 25:22–
26:3, 27:16–28:8, 31:20–33:2). Of note, the Court’s written order resolving this discovery dispute
explicitly corrected Otter on this point (see ECF No. 80 at 8 (“Contrary to Defendants’ assertion,
Plaintiff’s copyright infringement claim is not limited to the seven photographs discussed in the
[First Amended Complaint].”)). As such, both Capture Eleven and this Court put Otter on notice—
approximately four months prior to the close of fact discovery on August 3, 2021—that Capture
Eleven was relying on all copyright-registered images as at issue in this case, and that the non-
permitted uses Capture Eleven alleges included all of Otter’s uses outside the agreed-upon scope.
Similarly, at other times prior to the close of fact discovery, Capture Eleven put Otter on
notice of the scope of the accused images and non-permitted uses at issue in the case. For instance,
during his May 20, 2021, deposition, Justin L’Heureux testified that he provided screenshots from
his own infringement investigation to Otter (see ECF No. 154-5 at 171:6–172:1). Further, in its
initial Rule 26 disclosures, Capture Eleven incorporated the infringing images at issue from the
parties’ prior lawsuit (see ECF No. 141-10 at 5), and Exhibit K to the First Amended Complaint
included many of those images as well (see ECF Nos. 23, 23-15).
In view of these factors, the Court cannot agree with Otter that Capture Eleven concealed
or failed to disclose the scope of the images at issue within the meaning of Rules 26 or 37.
Nevertheless, for the sake of clarity in advance of trial, the Court will order Capture Eleven to
supplement its Rule 26 disclosures and discovery responses to set forth the full scope of the
accused images and non-permitted uses at issue in this case.
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IV. CONCLUSION
Consistent with the foregoing analysis, it is HEREBY ORDERED that:
1. 	Defendant’s Motion to Strike Contentions and Related Evidence Not Disclosed in Fact
Discovery (ECF No. 141) is DENIED; and
2. 	Within 14 days, Capture Eleven will supplement its Rule 26(a)(1)(A) disclosures and
discovery responses to specifically list all accused images and infringing uses on which it
intends to proceed at trial.
DATED this 29th day of September 2023.
BY THE COURT:
___________________________________
Charlotte N. Sweeney
United States District Judge
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