Maley: Third-party subpoenas: Advance service compliance

Federal practitioners regularly issue and respond to third-party subpoenas for documents. Expansive revisions to Rule 45 of the Federal Rules of Civil Procedure were made in 2013, but many subpoenas are still issued that do not comply. One of the most common issues is failing to serve parties with the third-party subpoena prior to (or even after) service on the third party.

Rule 45(a)(4) provides, “Notice to Other Parties Before Service. If the subpoena commands the production of documents, electronically stored information, or tangible things or the inspection of premises before trial, then before it is served on the person to whom it is directed, a notice and a copy of the subpoena must be served on each party.”

This rule does not provide guidance on how much advance notice is required. But local rules must be considered in third-party subpoena practice. In the Southern District of Indiana, for instance, Local Rule 45-1 provides: “Service of Subpoena on Non-Parties — Notice Requirement: If a subpoena to produce or permit is to be served upon a nonparty, a copy of the proposed subpoena must be served on all other parties at least 7 days prior to service of the subpoena on the nonparty, unless the parties agree to a different time frame or the case management plan provides otherwise. Provided, however, that if such subpoena relates to a matter set for hearing within such 7 day period or arises out of a bona fide emergency, such subpoena may be served upon a nonparty 1 day after a notice and copy of the subpoena is served on each party.” The Northern District of Indiana does not have a companion rule.

Much litigation has ensued across the country over Rule 45(a)(4) advance service non-compliance, including several cases in Indiana. A few examples provide an overview of these issues and practical guidance.

In Ello v. Brinton, 2017 WL 56316, at *4–5 (N.D. Ind. Jan. 5, 2017), Magistrate Judge John Martin addressed several issues, writing: “Rule 45(a)(4) provides, ‘If the subpoena commands the production of documents, electronically stored information, or tangible things … then before it is served on the person to whom it is directed, a notice and a copy of the subpoena must be served on each party.’ The purpose of the notice requirement is to ‘enabl[e] other parties to object or to serve a subpoena for additional materials.’ Fed. R. Civ. P. 45, Advisory Committee Notes.”

Judge Martin continued, “Counsel for Defendants represents that she could not locate binding authority concerning what the Court should do in light of Plaintiff’s failure to provide proper notice under Rule 45(a)(4). The Court’s own review of relevant case law reveals differing outcomes. Compare Duke v. Performance Food Grp., Inc., 594 Fed. Appx. 829, 832 (5th Cir. 2014) (‘The district court did not abuse its discretion by admitting documents obtained by serving a subpoena without notice to the opposing party.’), and Fujikara Ltd. v. Finisar Corp., No. 5:13-CV-03345, 2015 U.S. Dist. LEXIS 135871, at *12-13, 2015 WL 5782351 (N.D. Cal. May 14, 2015) (declining to quash subpoenas for failure to give prior notice because there was no prejudice from the ‘technical violation’), with Deuss v. Siso, No. 14-CV-710, 2014 WL 4275715, at *11 (N.D. Cal. Aug. 29, 2014) (quashing a subpoena for failure to give opposing party prior notice under Rule 45(a)(4)).”

Judge Martin concluded, “In this case, Defendants received notice of the subpoenas five days after they were served. Nine days after receiving the notice of the subpoenas, Defendants objected to them via their Motion to Quash. Nothing suggests that Plaintiffs received any documents in response to the subpoenas. A lack of prejudice by a failure to comply with Rule 45(a)(4) might not always save a non-compliant party’s subpoenas, but in this case Plaintiffs’ failure to notify Defendants was truly harmless. In light of this harmlessness, quashing the subpoenas for improper notice is unnecessary. Fujikura, 2015 U.S. Dist. LEXIS 135871 at *12, 2015 WL 5782351 (noting that several courts have declined to quash subpoenas for failure to give proper notice where the opposing party ultimately has some ‘notice and sufficient time to object’).”

A similar result is found in Bell v. Lantz, 2015 WL 6609290 (S.D. Ind. Oct. 30, 2015), in which defendant served a document subpoena on a third party and properly complied with Rule 45(a)(4) by providing advance notice and service upon plaintiff. The subpoena was returned as undeliverable to the third party, and defendant reissued the subpoena to the third party at a corrected address.

Plaintiff moved for sanctions, which the court denied, writing: “… Lantz did not serve notice and a copy of the second subpoena on Mortgage Electronic on Bell before serving the subpoena on the third party, which technically violated Rule 45(a)(4). Yet the subpoena was served on the same third-party, only at a different address, and requests production of the same documents sought in the original subpoena. Bell was informed of the subpoena and was able to move to quash the subpoena before time for compliance ran. The technical violation of Rule 45(a)(4) did not harm Bell; under the circumstances, no sanctions are warranted for this oversight.”

A different result occurred in DIRECTV, LLC v. Spina, 2016 WL 11458295 (S.D. Ind. Mar. 16, 2016), in which Magistrate Judge Tim Baker wrote: “It is undisputed that Overhauser failed to serve a copy of the subpoena on DIRECTV as required by Rule 45(a)(4). Overhauser argues this was an inadvertent oversight and does not warrant sanctions. However, DIRECTV’s evidence demonstrates the opposite. Overhauser repeatedly ignored DIRECTV’s inquiries about the subpoena prior to Spencer’s deposition. … Counsel for DIRECTV was not informed of the subpoena until the deposition began, at which point it had no ability to move to quash the subpoena. Overhauser characterizes Spencer as a DIRECTV insider and whistleblower, which signals that DIRECTV may claim some personal right or privilege in Spencer’s testimony, providing grounds for standing to quash the subpoena. Counsel for DIRECTV should have had the opportunity to review the subject matter of the subpoena in advance of Spencer’s deposition, but it was never served with a copy. Overhauser thus violated Rule 45(a)(4) and DIRECTV was prejudiced by the violation.”

Party standing: A final note on a party’s ability to move to quash a third-party subpoena. As the court wrote in Bell v. Lantz, “Generally a party lacks standing to move to quash a subpoena served on a third party, but an exception exists when the party ‘claims some personal right or privilege in respect to the subject matter of a subpoena duces tecum directed to a nonparty.’ Itochu Int’l, 303 F.R.D. at 232. A party has standing to challenge third-party subpoenas seeking the party’s financial records.” Bell, 2015 WL 6609290.•

• John Maley — [email protected] — is a partner with Barnes & Thornburg LLP, practicing federal and state litigation, employment matters and appeals. He clerked for Judge Larry McKinney from 1988-90. Opinions expressed are those of the author.