Preview
1 ROBERT L. ESENSTEN (Bar No. 65728)
resensten@esenstenlaw.com
2 JORDAN S. ESENSTEN (Bar No. 264645) ELECTRONICALLY
jesensten@esenstenlaw.com
3 ESENSTEN LAW F I L E D
Superior Court of California,
12100 Wilshire Boulevard, Suite 1660 County of San Francisco
4 Los Angeles, California 90025
Telephone: (310) 273-3090 04/24/2020
Clerk of the Court
5 Facsimile: (310) 207-5969 BY: ERNALYN BURA
Deputy Clerk
6 LOYR, APC
YOUNG W. RYU (SBN: 266372)
7 young.ryu@loywr.com
ALEXANDER D. WALLIN (SBN: 320420)
8 alexander.wallin@loywr.com
3130 Wilshire Blvd. Suite 209
9 Los Angeles, California 90010
Telephone: (888) 365 – 8686
10 Facsimile: (800) 576 – 1170
11
Attorneys for Plaintiff YOUMEE KIM and all others
12 similarly situated
Los Angeles, CA 90025
12100 Wilshire Blvd.
13
ESENSTEN LAW
Suite 1660
14 SUPERIOR COURT OF THE STATE OF CALIFORNIA
15 COUNTY OF SAN FRANCISCO
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17 SEJONG IM, an individual, and YOUMEE CASE NO. CGC-17-561775
KIM, an individual, on behalf of themselves
18 and all others similarly situated, CLASS ACTION
19 Plaintiffs, DECLARATION OF JORDAN S.
ESENSTEN IN SUPPORT OF
20 PLAINTIFF’S MOTION TO QUASH OR,
ALTERNATIVELY, FOR A
21 vs. PROTECTIVE ORDER
22
Hearing Date: TBD
23 EBATES INC., a corporation; and DOES 1- Time: TBD
100, Dept.: 613
24 Judge: Hon. Andrew Y.S. Cheng
Defendants.
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Complaint Filed: October 10, 2017
27 Trial Date: TBD
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CGC-17-561775
Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena
1 I, Jordan S. Esensten, declare:
2 1. I am an attorney licensed to practice in the State of California. I am an attorney at
3 the firm of Esensten Law, who, along with LOYR, APC, are attorneys of record for Plaintiff
4 Youmee Kim (“Plaintiff”) and the putative class in the above-captioned matter.
5 2. The Declaration is submitted in support of Plaintiff’s Motion to Quash Subpoena
6 Or, Alternatively, for a Protective Order. I am personally familiar with the facts set forth in this
7 Declaration. If called as a witness, I could and would competently testify to the matters stated
8 herein.
9 3. On October 10, 2017, Plaintiff filed this action against Defendant Ebates, Inc.
10 (“Ebates”). Plaintiff filed her First Amended Complaint (“FAC”) on March 29, 2018. The FAC
11 alleges that Ebates often accompanies the percentage of cash back with a representation that the
12 cash back percentage “was” previously a lower cash back percentage, which is placed immediately
Los Angeles, CA 90025
12100 Wilshire Blvd.
13 next to the current cash back percentage. The crux of the FAC is that Ebates utilizes “False ‘Was’
ESENSTEN LAW
Suite 1660
14 Percentages,” meaning that the “was” percentage does not reflect Ebates’ prevailing cash back
15 percentage offered during the three months immediately preceding the offer. The FAC alleges
16 that the use of False Was Percentages is unfair, fraudulent, and unlawful under California’s
17 consumer protection statutes.
18 4. On November 29, 2018, Plaintiff served Ebates with Plaintiff’s First Set of
19 Requests for Production of Documents (“RFPs”) and with Plaintiff’s First Set of Special
20 Interrogatories (“SROGs”). That same day, Ebates responded by serving Plaintiffs with eight sets
21 of discovery, two sets of form interrogatories, two sets of special interrogatories, two sets of
22 requests for production of documents, and two sets of requests for admissions. Ebates’ eight (8)
23 sets of discovery requests consist of 99 requests for production of documents, 34 special
24 interrogatories, 15 requests for admissions, and 64 form interrogatories. Plaintiffs responded to
25 Ebates’ discovery requests and produced over 11,000 pages of documents. However, after Ebates
26 failed to substantively respond to Plaintiff’s first set of discovery requests and with Ebates having
27 failed to produce a single document, Plaintiff was forced to file a motion to compel further
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1 CGC-17-561775
Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena
1 responses. On August 2, 2019, the Court granted in part, and denied in part, Plaintiff’s motion to
2 compel.
3 5. In May 2019, I informed Ebates’ counsel that Mr. Im no longer wished to
4 participate in this litigation. The parties set up an informal telephonic conference with the Court
5 to notify the Court of the issue. During that June 3, 2019, informal conference and the statement
6 filed in advance of that conference, I notified Judge Wiss, who was presiding over this action at
7 the time, of the same. Ebates’ counsel responded by disclosing that Ebates intended to argue that
8 Mr. Im brought this lawsuit in bad faith because he supposedly worked for Mallree, one of the
9 thousands of companies who, like Ebates, engages in affiliate marketing. Judge Wiss
10 recommended dismissing Mr. Im. Per Judge Wiss’s suggestion, Mr. Im filed a request for
11 dismissal.
12 6. On June 27, 2019, Ebates served my office with a subpoena demanding Mr. Im’s
Los Angeles, CA 90025
12100 Wilshire Blvd.
13 appearance at a deposition and the production of documents. The document request is mainly
ESENSTEN LAW
Suite 1660
14 focused on documents belonging to his employer, MakeshopNcompany (“MNC”), and certain
15 Korean-based entities, such as Korea Center (which is believed to be MNC’s parent), Mallree,
16 Malltail, Taillist, and Viatra (the “Korean-Based Entities”), which Ebates claims have ties to
17 MNC.
18 7. Despite his intention to no longer proceed as a plaintiff, Mr. Im complied with the
19 subpoena and attended a full-day deposition on July 30, 2019. I attended the deposition. Mr. Im
20 answered questions until 7:30 p.m. concerning the reasons he filed this litigation, testifying as to
21 the lack of connections that the Korean-Based Entities have with this lawsuit and to the United
22 States’ market. (See Ex. 2.) At his deposition, Mr. Im also produced over 200 pages of
23 documents concerning his use of Ebates and purchases pursuant to the subpoena.
24 8. Following Mr. Im’s deposition, Ebates subpoenaed MNC. Ebates has since
25 amended and re-served the MNC subpoena on multiple occasions. The MNC subpoena contains
26 31 categories of document requests and 21 deposition topics, ranging from employee files, market
27 research, legal proceedings, and corporate structure for the company and its subsidiaries.
28 Although the subpoena is directed towards MNC, the subpoena seeks documents from the Korean-
2 CGC-17-561775
Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena
1 Based Entities. (See Ex. 1.)
2 9. For months following Ebates’ initial service of the subpoena, I went back and forth
3 with Ebates’ counsel as to the relevancy and the propriety of Ebates’ line of discovery. In
4 particular, the parties have spent incredible time and effort debating the relevancy of Ebates’
5 theory alleging that Plaintiffs filed this action in “bad faith.” From the beginning, I requested that
6 Ebates’ counsel provide authority supporting the notion that a plaintiff’s subjective reasoning for
7 filing the lawsuit is relevant to class certification. For at least 2 months, Ebates’ counsel
8 consistently ignored the request and failed to provide any supporting authority. (See Ex. 3 at 6.)
9 When Ebates finally did respond to the request, on October 25, 2019, its response was to disclaim
10 any obligation to provide authority supporting its own arguments during the meet and confer
11 process. (See Ex. 4 at 7.)
12 10. Although Ebates’ counsel continually insisted to me that Ebates is entitled to the
Los Angeles, CA 90025
12100 Wilshire Blvd.
13 discovery in the MNC subpoena, Ebates never filed a motion to compel. Without any movement
ESENSTEN LAW
Suite 1660
14 on Ebates’ end, I proposed to Ebates’ counsel that Plaintiffs file a motion to quash the MNC
15 subpoena as a means of resolving the relevancy of the Ebates’ line of discovery as well as
16 expediting the resolution of the other issues attendant to the MNC subpoena. (See Ex. 4 at 6.)
17 11. On December 11, 2019, Judge Jackson held an informal discovery conference
18 concerning the proposed motion to quash, the propriety of the MNC subpoena, and Ebates’
19 proposed motion to compel further documents from the Im subpoena. I attended the hearing in
20 person. In advance of the informal discovery conference, each party submitted a letter brief as to
21 the issues raised in the Im subpoena and the MNC subpoena. During the informal conference,
22 however, Judge Jackson stated that the Court was unable to resolve the issues raised by the parties
23 without full briefing of the issues raised and allowed Plaintiffs to file a motion to quash the
24 subpoena.
25 12. During that same December 11, 2019 hearing, the parties also discussed Mr. Im’s
26 pending request for dismissal. Ebates, just as it had done so for the previous six (6) months,
27 strenuously objected to Mr. Im’s dismissal so that it could continue advancing its “bad faith”
28 theory. Judge Jackson, however, acknowledged that Mr. Im had performed all that was requested
3 CGC-17-561775
Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena
1 of him by the Court and, on that basis, dismissed Mr. Im as a plaintiff.
2 13. On November 20, 2019, my office served Ebates with a second round of discovery,
3 including requests for production of documents, special interrogatories, and requests for
4 admissions. To date, the parties’ discovery efforts have been extensive and have included multiple
5 rounds of discovery, 13 sets of discovery requests (excluding subpoenas), 338 discovery requests,
6 production of nearly 200,000 pages of documents, and Mr. Im’s all-day deposition.
7 14. Attached hereto as “Exhibit 1” is a true and correct copy of Ebates’ most recent
8 MNC subpoena.
9 15. Attached hereto as “Exhibit 2” is a true a correct copy of relevant excerpts from
10 the transcript of Mr. Im’s July 30, 2019 deposition.
11 16. Attached hereto as “Exhibit 3” is a true and correct copy of an email exchange
12 between Ebates’ counsel and myself from October 11, 2019 to October 25, 2019 concerning the
Los Angeles, CA 90025
12100 Wilshire Blvd.
13 issues in this motion.
ESENSTEN LAW
Suite 1660
14 17. Attached hereto as “Exhibit 4” is a true and correct copy of an email between
15 Ebates’ counsel and myself from October 25, 2019 to October 29, 2019 concerning the issues in
16 this motion.
17 18. Attached hereto as “Exhibit 5” and “Exhibit 6” are true and correct copies of
18 Plaintiffs’ letter brief and Ebates’ letter brief, respectively, submitted in advance of the December
19 11, 2019 informal discovery conference.
20 19. Attached hereto as “Exhibit 7” is a true and correct copy of the transcript from the
21 December 11, 2019 informal discovery confer7ence and case management conference.
22 20. Attached hereto as “Exhibit 8” is a true and correct copy of relevant excerpts from
23 the October 7, 2019 case management conference.
24 ///
25 ///
26 ///
27 ///
28 ///
4 CGC-17-561775
Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena
1 I declare under penalty of perjury under the laws of the State of California that the
2 foregoing is true and correct.
3
4 Executed April 24, 2020.
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Jordan S. Esensten
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Los Angeles, CA 90025
12100 Wilshire Blvd.
13
ESENSTEN LAW
Suite 1660
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5 CGC-17-561775
Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena
1 PROOF OF SERVICE
2 STATE OF CALIFORNIA, COUNTY OF LOS ANGELES
3 I am employed in the County of LOS ANGELES, STATE OF CALIFORNIA. My
business address is 12100 Wilshire Boulevard, Suite 1660, Los Angeles, California 90025. I am
4 over the age of eighteen years and am not a party to the within action;
5 On April 24, 2020, I served the following document(s) entitled DECLARATION OF
JORDAN S. ESENSTEN IN SUPPORT OF PLAINTIFF’S MOTION TO QUASH OR,
6 ALTERNATIVELY, FOR A PROTECTIVE ORDER
on ALL INTERESTED PARTIES in this action as follows:
7
Spencer Persson, Esq. Attorneys for Defendant Ebates,
8 DAVIS WRIGHT TREMAINE LLP Inc.
865 S Figueroa Street, Suite 2400
9 Los Angeles, CA 90017
10 Tel: (213) 633-8634 | Fax: (213) 633-6899
Email: spencerpersson@dwt.com
11
12
Young W. Ryu, Esq. Attorneys for Plaintiff Youmee
Los Angeles, CA 90025
LOYR, APC Kim
12100 Wilshire Blvd.
13
ESENSTEN LAW
3130 Wilshire Blvd. Suite 209
Suite 1660
14 Los Angeles, California 90010
Tel: (888) 365-8686
15 Fax: (800) 576-1170
16 Email: young.ryu@loywr.com
17
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BY ELECTRONIC MAIL TRANSMISSION (Via File&ServeXpress): The
19 document(s) was/were transmitted via File & ServeXpress on the recipients designated on the
Transaction Receipts located on the File and ServeXpress website and such transmission was
20 reported as complete and without error.
21 I declare under penalty of perjury under the laws of the State of California that the
foregoing is true and correct.
22
Executed on April 24, 2020, at Los Angeles, California.
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25 Jordan S. Esensten
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6 CGC-17-561775
Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena
EXHIBIT 1
64780224
Mar 02 2020
01:05PM
1 NORTON ROSE FULBRIGHT US LLP
SPENCER PERSSON (BAR NO. 235054)
2 MICHELLE L. CARTER (BAR NO. 288081)
555 South Flower Street
3 Forty-First Floor
Los Angeles, California 90071
4 Telephone: (213)892-9200
Facsimile: (213)892-9494
5 spencer.persson@nortonrosefulbright.com
michelle.carter@nortonrosefulbright.com
6
Attorneys for Defendant
7 EBATES INC.
8 SUPERIOR COURT OF THE STATE OF CALIFORNIA
9 COUNTY OF SAN FRANCISCO
10
11 SEJONGIM, an individual, and YOUMEE Case No. CGC-17-561775
KIM, an individual, on behalf of themselves
12 and all others similarly situated, Assigned For All Purposes To The
Honorable Teri L. Jackson
13 Plaintiffs, Complex Department 613
14 V. DEFENDANT EBATES INC.'S AMENDED
NOTICE OF DEPOSITION OF
15 EBATES INC., a corporation; and DOES 1- MAKESHOPNCOMPANY INC.
100,
16
Defendants. New Date: March 23, 2020
17 Time: 9:00 a.m.
Location: Norton Rose Fulbright US LLP
18 555 S. Flower Street, 41st Floor,
Los Angeles, CA 90071
19
Action Filed: October 10, 2017
20
21
22
23
24
25
26
27
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DCXnjMFNT PrETARH) 98647814.1
l>NRrcYaU)PAPKR
DEFENDANT EBATES INC.'S AMENDED NOTICE OF DEPOSITION OF MAKESHOPNCOMPANY, INC.
EXHIBIT 2
1 SUPERIOR COURT OF THE STATE OF CALIFORNIA
2 COUNTY OF S FRANCISCO
3
IM, AN INDIVIDUAL, AND
4
5
SEJONG
YOUMEE KIM, AN INDIVIDUAL, ON
ORIGINAL
6 BEHALF OF THEMSELVES AND ALL
7 OTHERS SIMILARLY SITUATED,
8 PLAINTIFFS
9 Case No.
10 vs. CGC-17-561775
11
12 EBATES, INC., A CORPORATION;
13 AND DOES 1-100" VOLUME I
14 DEFENDANTS.
15
16
17 VIDEOTAPED DEPOSITION OF SEJONG IM
18 TUESDAY, JULY 30, 2019
19
20
21 REPORTER:
22 JESSICA N. NAVARRO,
O. 3
3 5
25 PAGES 1-187
1
1 MR. PERSS Mark next in order
2 Exhibit 14.
3 (Whereupon, Defendants' Exhibit 14 was
4 marked for identification by the court
5 reporter and attached hereto.)
6 BY MR. PERSSON:
7 Q Do you recognize this document?
8 A Yes.
9 Q Is this from the MakeshopNcompany website?
10 A Yes, it appears to be so.
11 Q Who is responsible for the content of this
12 page?
13 A I believe it's our company's administrator
14 employee.
15 Q Does anyone higher up on the food chain
16 ever review the content of a page like this?
17 A To my recollection, I don't think anyone
18 in the upper management has ever reviewed this U.S.
19 home page.
20 Q So no one in management reviews website
21 pages for accuracy at MakeshopNcompany?
22 A I'm sorry to say, I'm arras sed to say
a , ea he ,s a
r re i a e e
25 States.
Pa 75
1 So as far as this company's home ge in
2 English is concerned, I don't believe we really
3 thought of it as so important and I think it's been
4 a while since this has been updated as well.
5 Q Would there be an associated or similar
6 page in Korean for MakeshopNcompany and associated
7 websites?
8 A Not to my knowledge, there isn't any.
9 Q It says here MakeshopNcompany is one of
10 the fastest developing global eCommerce
11 corporations. Do you see that first sentence?
12 A Yes.
13 Q Okay. And when that statement is made,
14 what what are you talking about here? Are you
15 talking about Korea Center, MakeshopNcompany, and
16 all associated brands or are you just talking about
17 MakeshopNcompany?
18 A It appears that it is only referring to
19 MakeshopNcompany.
20 Q Okay. And when it talks about
21 MakeshopNcompany, though, further down the page we
22 see a reference to the MallTail. Is it incl ing
a
e e f kesh a y
25 only there are branch stores or branch offices in
Pa 76
1 south Korea, there are branch offices in Germany,
2 Japan, and China as well. I am not in charge of the
3 whole offices and locations. So in any case for
4 MallTail there are branches in the United States,
5 Germany, Japan, as well as China.
6 Q The MallTail that operates in the United
7 States, would you be in charge of that?
8 MR. ESENSTEN: Objection; vague and
9 ambiguous.
10 THE WITNESS: Yes, but not the whole
11 thing.
12 BY MR. PERSSON:
13 Q What part of U.S. operations would you not
14 be in charge from? Is that the portion that
15 Mr. Choi would be overseeing?
16 A Right.
17 Q Okay. If you had to divide up what
18 portion of' the business you are in charge of versus
19 Mr. Choi, what are you in charge of for Mall
20 MakeshopNcompany, MallTail?
21 A That's kind of a complicated question, so
22 I don't know if I can put it into percentage. But
respe e e e e ates a
st a f I sa rna
25 approximately 50 percent or so.
Pa 77
1 Q question was really -- thank you for
2 that. But my question really wasn't about
3 percentage of what you're in cha e of, but what
4 areas of the business you're in charge in.
5 So, you know, for example, you used to be
6 CFO. I imagine that means that you oversee finance,
7 accounting, et cetera.
8 What I'm trying to figure out is what else
9 falls under that 50 percent?
10 A As I said before, on paper I am shown as a
11 CFO. But I'm involved in the overall operation of
12 the branch in the United States. Although I don't
13 have a high authority, I am involved in the finance
14 accounting, personnel, general affairs, and the
15 general operations of the company in the U.S. I
16 won't say that I am in charge of everything, though.
17 Q Who is in charge of marketing and PR?
18 A Mainly it's handled in Korea. As I said
19 before, since majority of our customers are Korean,
20 that is mainly handled by the people who are charged
21 with in Korea.
22 Q Okay. But in the United States t
a a a
e f ai s I fa n r r e .
25 What falls un r Mr. Choi's purview?
78
1 A For example, with respect to the finance
2 and accounting, I reviewed the materials for the
3 monthly result and quarterly result and Mr. Seung
4 Choi, who is the executive director, would verify
5 it. And thereafter, the information could be
6 discussed within the headquarters as far as I know.
7 But beyond that, I don't know.
8 Q Okay. And so is it true then that
9 marketing and PR and even affiliate relationships
10 just are not handled in the United States?
11 A Affiliate.
12 Q So if there's a U.S. company that's an
13 affiliate, then one of you two would, for example,
14 interact with that person?
15 MR. ESENSTEN: I'm sorry, sorry to
16 interrupt, but did we get a translation on his
17 answer to the last question.
18 MR. PERSSON: Yeah, I think so. Didn't
19 we? Yeah, where he told me that Mr. Choi is the
20 executive director. He would look at results also,
21 et cetera.
22 MR. ESENSTEN: o y. I -
e s a a a
e.
25 THE INTERPRETER: May the interpreter
79
1 clarify with the witness, please?
2 MR. PERSSON: Sure.
3 (Interpreter confers with witness in
4 Korean. )
5 THE WITNESS: Business model? So when you
6 say affiliate, are you referring to business model
7 or some kind of company name?
8 BY MR. PERSSON:
9 Q I'm talking about, you know, the
10 persons -- you know, we can return to that question.
11 I'm just trying to understand who -- who might -- if
12 there's anyone in the United States who oversees
13 marketing and PR and advertising and things like
14 that?
15 A I'm wondering if the -- the words that the
16 interpreter are using of the question for the
17 question asked by attorney, Spencer, are somewhat
18 different. Maybe there's a little different meaning
19 to it?
20 Q Well, I don't know how I can attest to
21 that. I can get my associate, who was supposed to
22 be here today, but didn't come en we thou t it
was a e et er I
n e s t o a
25 A With respect to the marketing and PR,
80
1 since we don't have any customers that we deal with
2 in the United States, there's no person here who is
3 in charge of it, so that is handled by someone in
4 Korea.
5 With respect to the advertisements, again,
6 to my recollection we have never a rtised in the
7 United States.
8 BY MR. PERSSON:
9 Q And when you say you have --
10 A However
11 Q Go ahead.
12 A However, with respect to the affiliate
13 business in doing business with the affiliate
14 businesses, there is a person who handles the
15 communications with the advertisers, the networking
16 companies, and also communicates with the team in
17 Korea.
18 Q Is that it?
19 A Yes.
20 Q And who is that person?
21 A An employee named Jasmine Chang.
22 Q Is that Y E-S-M-I N-E or is it Jas ne in
t a e
1- - t erta
25 of the spelling.
81
1 Now, you listed a bunch of different
2 operations that are in the U.S. and you said admin,
3 HR, finance, Vitatra Team, BD Team, MallTail
4 department, Taillist department, et cetera.
5 My question for you is: You as the
6 president who has duties of finance, accounting,
7 personnel affairs, you are overseeing all of that
8 personnel; is that right?
9 A Not everything.
10 Q What is it?
11 A So, for example, our company's controller
12 could override me and communicate with the CFO at
13 the headquarters in Korea. Therefore, I can't say
14 that I oversee everything.
15 Q Understood. You said earlier that you
16 don't have any customers in the United States. Are
17 you saying just that MakeshopNcompany as a shipping
18 entity doesn't have any customers?
19 A Yes, that's correct.
20 Q Okay. What about MallRee? Do they have
21 registered users in the United
Preview
1 ROBERT L. ESENSTEN (Bar No. 65728) resensten@esenstenlaw.com 2 JORDAN S. ESENSTEN (Bar No. 264645) ELECTRONICALLY jesensten@esenstenlaw.com 3 ESENSTEN LAW F I L E D Superior Court of California, 12100 Wilshire Boulevard, Suite 1660 County of San Francisco 4 Los Angeles, California 90025 Telephone: (310) 273-3090 04/24/2020 Clerk of the Court 5 Facsimile: (310) 207-5969 BY: ERNALYN BURA Deputy Clerk 6 LOYR, APC YOUNG W. RYU (SBN: 266372) 7 young.ryu@loywr.com ALEXANDER D. WALLIN (SBN: 320420) 8 alexander.wallin@loywr.com 3130 Wilshire Blvd. Suite 209 9 Los Angeles, California 90010 Telephone: (888) 365 – 8686 10 Facsimile: (800) 576 – 1170 11 Attorneys for Plaintiff YOUMEE KIM and all others 12 similarly situated Los Angeles, CA 90025 12100 Wilshire Blvd. 13 ESENSTEN LAW Suite 1660 14 SUPERIOR COURT OF THE STATE OF CALIFORNIA 15 COUNTY OF SAN FRANCISCO 16 17 SEJONG IM, an individual, and YOUMEE CASE NO. CGC-17-561775 KIM, an individual, on behalf of themselves 18 and all others similarly situated, CLASS ACTION 19 Plaintiffs, DECLARATION OF JORDAN S. ESENSTEN IN SUPPORT OF 20 PLAINTIFF’S MOTION TO QUASH OR, ALTERNATIVELY, FOR A 21 vs. PROTECTIVE ORDER 22 Hearing Date: TBD 23 EBATES INC., a corporation; and DOES 1- Time: TBD 100, Dept.: 613 24 Judge: Hon. Andrew Y.S. Cheng Defendants. 25 26 Complaint Filed: October 10, 2017 27 Trial Date: TBD 28 CGC-17-561775 Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena 1 I, Jordan S. Esensten, declare: 2 1. I am an attorney licensed to practice in the State of California. I am an attorney at 3 the firm of Esensten Law, who, along with LOYR, APC, are attorneys of record for Plaintiff 4 Youmee Kim (“Plaintiff”) and the putative class in the above-captioned matter. 5 2. The Declaration is submitted in support of Plaintiff’s Motion to Quash Subpoena 6 Or, Alternatively, for a Protective Order. I am personally familiar with the facts set forth in this 7 Declaration. If called as a witness, I could and would competently testify to the matters stated 8 herein. 9 3. On October 10, 2017, Plaintiff filed this action against Defendant Ebates, Inc. 10 (“Ebates”). Plaintiff filed her First Amended Complaint (“FAC”) on March 29, 2018. The FAC 11 alleges that Ebates often accompanies the percentage of cash back with a representation that the 12 cash back percentage “was” previously a lower cash back percentage, which is placed immediately Los Angeles, CA 90025 12100 Wilshire Blvd. 13 next to the current cash back percentage. The crux of the FAC is that Ebates utilizes “False ‘Was’ ESENSTEN LAW Suite 1660 14 Percentages,” meaning that the “was” percentage does not reflect Ebates’ prevailing cash back 15 percentage offered during the three months immediately preceding the offer. The FAC alleges 16 that the use of False Was Percentages is unfair, fraudulent, and unlawful under California’s 17 consumer protection statutes. 18 4. On November 29, 2018, Plaintiff served Ebates with Plaintiff’s First Set of 19 Requests for Production of Documents (“RFPs”) and with Plaintiff’s First Set of Special 20 Interrogatories (“SROGs”). That same day, Ebates responded by serving Plaintiffs with eight sets 21 of discovery, two sets of form interrogatories, two sets of special interrogatories, two sets of 22 requests for production of documents, and two sets of requests for admissions. Ebates’ eight (8) 23 sets of discovery requests consist of 99 requests for production of documents, 34 special 24 interrogatories, 15 requests for admissions, and 64 form interrogatories. Plaintiffs responded to 25 Ebates’ discovery requests and produced over 11,000 pages of documents. However, after Ebates 26 failed to substantively respond to Plaintiff’s first set of discovery requests and with Ebates having 27 failed to produce a single document, Plaintiff was forced to file a motion to compel further 28 1 CGC-17-561775 Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena 1 responses. On August 2, 2019, the Court granted in part, and denied in part, Plaintiff’s motion to 2 compel. 3 5. In May 2019, I informed Ebates’ counsel that Mr. Im no longer wished to 4 participate in this litigation. The parties set up an informal telephonic conference with the Court 5 to notify the Court of the issue. During that June 3, 2019, informal conference and the statement 6 filed in advance of that conference, I notified Judge Wiss, who was presiding over this action at 7 the time, of the same. Ebates’ counsel responded by disclosing that Ebates intended to argue that 8 Mr. Im brought this lawsuit in bad faith because he supposedly worked for Mallree, one of the 9 thousands of companies who, like Ebates, engages in affiliate marketing. Judge Wiss 10 recommended dismissing Mr. Im. Per Judge Wiss’s suggestion, Mr. Im filed a request for 11 dismissal. 12 6. On June 27, 2019, Ebates served my office with a subpoena demanding Mr. Im’s Los Angeles, CA 90025 12100 Wilshire Blvd. 13 appearance at a deposition and the production of documents. The document request is mainly ESENSTEN LAW Suite 1660 14 focused on documents belonging to his employer, MakeshopNcompany (“MNC”), and certain 15 Korean-based entities, such as Korea Center (which is believed to be MNC’s parent), Mallree, 16 Malltail, Taillist, and Viatra (the “Korean-Based Entities”), which Ebates claims have ties to 17 MNC. 18 7. Despite his intention to no longer proceed as a plaintiff, Mr. Im complied with the 19 subpoena and attended a full-day deposition on July 30, 2019. I attended the deposition. Mr. Im 20 answered questions until 7:30 p.m. concerning the reasons he filed this litigation, testifying as to 21 the lack of connections that the Korean-Based Entities have with this lawsuit and to the United 22 States’ market. (See Ex. 2.) At his deposition, Mr. Im also produced over 200 pages of 23 documents concerning his use of Ebates and purchases pursuant to the subpoena. 24 8. Following Mr. Im’s deposition, Ebates subpoenaed MNC. Ebates has since 25 amended and re-served the MNC subpoena on multiple occasions. The MNC subpoena contains 26 31 categories of document requests and 21 deposition topics, ranging from employee files, market 27 research, legal proceedings, and corporate structure for the company and its subsidiaries. 28 Although the subpoena is directed towards MNC, the subpoena seeks documents from the Korean- 2 CGC-17-561775 Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena 1 Based Entities. (See Ex. 1.) 2 9. For months following Ebates’ initial service of the subpoena, I went back and forth 3 with Ebates’ counsel as to the relevancy and the propriety of Ebates’ line of discovery. In 4 particular, the parties have spent incredible time and effort debating the relevancy of Ebates’ 5 theory alleging that Plaintiffs filed this action in “bad faith.” From the beginning, I requested that 6 Ebates’ counsel provide authority supporting the notion that a plaintiff’s subjective reasoning for 7 filing the lawsuit is relevant to class certification. For at least 2 months, Ebates’ counsel 8 consistently ignored the request and failed to provide any supporting authority. (See Ex. 3 at 6.) 9 When Ebates finally did respond to the request, on October 25, 2019, its response was to disclaim 10 any obligation to provide authority supporting its own arguments during the meet and confer 11 process. (See Ex. 4 at 7.) 12 10. Although Ebates’ counsel continually insisted to me that Ebates is entitled to the Los Angeles, CA 90025 12100 Wilshire Blvd. 13 discovery in the MNC subpoena, Ebates never filed a motion to compel. Without any movement ESENSTEN LAW Suite 1660 14 on Ebates’ end, I proposed to Ebates’ counsel that Plaintiffs file a motion to quash the MNC 15 subpoena as a means of resolving the relevancy of the Ebates’ line of discovery as well as 16 expediting the resolution of the other issues attendant to the MNC subpoena. (See Ex. 4 at 6.) 17 11. On December 11, 2019, Judge Jackson held an informal discovery conference 18 concerning the proposed motion to quash, the propriety of the MNC subpoena, and Ebates’ 19 proposed motion to compel further documents from the Im subpoena. I attended the hearing in 20 person. In advance of the informal discovery conference, each party submitted a letter brief as to 21 the issues raised in the Im subpoena and the MNC subpoena. During the informal conference, 22 however, Judge Jackson stated that the Court was unable to resolve the issues raised by the parties 23 without full briefing of the issues raised and allowed Plaintiffs to file a motion to quash the 24 subpoena. 25 12. During that same December 11, 2019 hearing, the parties also discussed Mr. Im’s 26 pending request for dismissal. Ebates, just as it had done so for the previous six (6) months, 27 strenuously objected to Mr. Im’s dismissal so that it could continue advancing its “bad faith” 28 theory. Judge Jackson, however, acknowledged that Mr. Im had performed all that was requested 3 CGC-17-561775 Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena 1 of him by the Court and, on that basis, dismissed Mr. Im as a plaintiff. 2 13. On November 20, 2019, my office served Ebates with a second round of discovery, 3 including requests for production of documents, special interrogatories, and requests for 4 admissions. To date, the parties’ discovery efforts have been extensive and have included multiple 5 rounds of discovery, 13 sets of discovery requests (excluding subpoenas), 338 discovery requests, 6 production of nearly 200,000 pages of documents, and Mr. Im’s all-day deposition. 7 14. Attached hereto as “Exhibit 1” is a true and correct copy of Ebates’ most recent 8 MNC subpoena. 9 15. Attached hereto as “Exhibit 2” is a true a correct copy of relevant excerpts from 10 the transcript of Mr. Im’s July 30, 2019 deposition. 11 16. Attached hereto as “Exhibit 3” is a true and correct copy of an email exchange 12 between Ebates’ counsel and myself from October 11, 2019 to October 25, 2019 concerning the Los Angeles, CA 90025 12100 Wilshire Blvd. 13 issues in this motion. ESENSTEN LAW Suite 1660 14 17. Attached hereto as “Exhibit 4” is a true and correct copy of an email between 15 Ebates’ counsel and myself from October 25, 2019 to October 29, 2019 concerning the issues in 16 this motion. 17 18. Attached hereto as “Exhibit 5” and “Exhibit 6” are true and correct copies of 18 Plaintiffs’ letter brief and Ebates’ letter brief, respectively, submitted in advance of the December 19 11, 2019 informal discovery conference. 20 19. Attached hereto as “Exhibit 7” is a true and correct copy of the transcript from the 21 December 11, 2019 informal discovery confer7ence and case management conference. 22 20. Attached hereto as “Exhibit 8” is a true and correct copy of relevant excerpts from 23 the October 7, 2019 case management conference. 24 /// 25 /// 26 /// 27 /// 28 /// 4 CGC-17-561775 Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena 1 I declare under penalty of perjury under the laws of the State of California that the 2 foregoing is true and correct. 3 4 Executed April 24, 2020. 5 6 7 Jordan S. Esensten 8 9 10 11 12 Los Angeles, CA 90025 12100 Wilshire Blvd. 13 ESENSTEN LAW Suite 1660 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5 CGC-17-561775 Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena 1 PROOF OF SERVICE 2 STATE OF CALIFORNIA, COUNTY OF LOS ANGELES 3 I am employed in the County of LOS ANGELES, STATE OF CALIFORNIA. My business address is 12100 Wilshire Boulevard, Suite 1660, Los Angeles, California 90025. I am 4 over the age of eighteen years and am not a party to the within action; 5 On April 24, 2020, I served the following document(s) entitled DECLARATION OF JORDAN S. ESENSTEN IN SUPPORT OF PLAINTIFF’S MOTION TO QUASH OR, 6 ALTERNATIVELY, FOR A PROTECTIVE ORDER on ALL INTERESTED PARTIES in this action as follows: 7 Spencer Persson, Esq. Attorneys for Defendant Ebates, 8 DAVIS WRIGHT TREMAINE LLP Inc. 865 S Figueroa Street, Suite 2400 9 Los Angeles, CA 90017 10 Tel: (213) 633-8634 | Fax: (213) 633-6899 Email: spencerpersson@dwt.com 11 12 Young W. Ryu, Esq. Attorneys for Plaintiff Youmee Los Angeles, CA 90025 LOYR, APC Kim 12100 Wilshire Blvd. 13 ESENSTEN LAW 3130 Wilshire Blvd. Suite 209 Suite 1660 14 Los Angeles, California 90010 Tel: (888) 365-8686 15 Fax: (800) 576-1170 16 Email: young.ryu@loywr.com 17 18 BY ELECTRONIC MAIL TRANSMISSION (Via File&ServeXpress): The 19 document(s) was/were transmitted via File & ServeXpress on the recipients designated on the Transaction Receipts located on the File and ServeXpress website and such transmission was 20 reported as complete and without error. 21 I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. 22 Executed on April 24, 2020, at Los Angeles, California. 23 24 25 Jordan S. Esensten 26 27 28 6 CGC-17-561775 Esensten Declaration in Support of Plaintiff’s Motion to Quash MakeshopNcompany Subpoena EXHIBIT 1 64780224 Mar 02 2020 01:05PM 1 NORTON ROSE FULBRIGHT US LLP SPENCER PERSSON (BAR NO. 235054) 2 MICHELLE L. CARTER (BAR NO. 288081) 555 South Flower Street 3 Forty-First Floor Los Angeles, California 90071 4 Telephone: (213)892-9200 Facsimile: (213)892-9494 5 spencer.persson@nortonrosefulbright.com michelle.carter@nortonrosefulbright.com 6 Attorneys for Defendant 7 EBATES INC. 8 SUPERIOR COURT OF THE STATE OF CALIFORNIA 9 COUNTY OF SAN FRANCISCO 10 11 SEJONGIM, an individual, and YOUMEE Case No. CGC-17-561775 KIM, an individual, on behalf of themselves 12 and all others similarly situated, Assigned For All Purposes To The Honorable Teri L. Jackson 13 Plaintiffs, Complex Department 613 14 V. DEFENDANT EBATES INC.'S AMENDED NOTICE OF DEPOSITION OF 15 EBATES INC., a corporation; and DOES 1- MAKESHOPNCOMPANY INC. 100, 16 Defendants. New Date: March 23, 2020 17 Time: 9:00 a.m. Location: Norton Rose Fulbright US LLP 18 555 S. Flower Street, 41st Floor, Los Angeles, CA 90071 19 Action Filed: October 10, 2017 20 21 22 23 24 25 26 27 28 DCXnjMFNT PrETARH) 98647814.1 l>NRrcYaU)PAPKR DEFENDANT EBATES INC.'S AMENDED NOTICE OF DEPOSITION OF MAKESHOPNCOMPANY, INC. EXHIBIT 2 1 SUPERIOR COURT OF THE STATE OF CALIFORNIA 2 COUNTY OF S FRANCISCO 3 IM, AN INDIVIDUAL, AND 4 5 SEJONG YOUMEE KIM, AN INDIVIDUAL, ON ORIGINAL 6 BEHALF OF THEMSELVES AND ALL 7 OTHERS SIMILARLY SITUATED, 8 PLAINTIFFS 9 Case No. 10 vs. CGC-17-561775 11 12 EBATES, INC., A CORPORATION; 13 AND DOES 1-100" VOLUME I 14 DEFENDANTS. 15 16 17 VIDEOTAPED DEPOSITION OF SEJONG IM 18 TUESDAY, JULY 30, 2019 19 20 21 REPORTER: 22 JESSICA N. NAVARRO, O. 3 3 5 25 PAGES 1-187 1 1 MR. PERSS Mark next in order 2 Exhibit 14. 3 (Whereupon, Defendants' Exhibit 14 was 4 marked for identification by the court 5 reporter and attached hereto.) 6 BY MR. PERSSON: 7 Q Do you recognize this document? 8 A Yes. 9 Q Is this from the MakeshopNcompany website? 10 A Yes, it appears to be so. 11 Q Who is responsible for the content of this 12 page? 13 A I believe it's our company's administrator 14 employee. 15 Q Does anyone higher up on the food chain 16 ever review the content of a page like this? 17 A To my recollection, I don't think anyone 18 in the upper management has ever reviewed this U.S. 19 home page. 20 Q So no one in management reviews website 21 pages for accuracy at MakeshopNcompany? 22 A I'm sorry to say, I'm arras sed to say a , ea he ,s a r re i a e e 25 States. Pa 75 1 So as far as this company's home ge in 2 English is concerned, I don't believe we really 3 thought of it as so important and I think it's been 4 a while since this has been updated as well. 5 Q Would there be an associated or similar 6 page in Korean for MakeshopNcompany and associated 7 websites? 8 A Not to my knowledge, there isn't any. 9 Q It says here MakeshopNcompany is one of 10 the fastest developing global eCommerce 11 corporations. Do you see that first sentence? 12 A Yes. 13 Q Okay. And when that statement is made, 14 what what are you talking about here? Are you 15 talking about Korea Center, MakeshopNcompany, and 16 all associated brands or are you just talking about 17 MakeshopNcompany? 18 A It appears that it is only referring to 19 MakeshopNcompany. 20 Q Okay. And when it talks about 21 MakeshopNcompany, though, further down the page we 22 see a reference to the MallTail. Is it incl ing a e e f kesh a y 25 only there are branch stores or branch offices in Pa 76 1 south Korea, there are branch offices in Germany, 2 Japan, and China as well. I am not in charge of the 3 whole offices and locations. So in any case for 4 MallTail there are branches in the United States, 5 Germany, Japan, as well as China. 6 Q The MallTail that operates in the United 7 States, would you be in charge of that? 8 MR. ESENSTEN: Objection; vague and 9 ambiguous. 10 THE WITNESS: Yes, but not the whole 11 thing. 12 BY MR. PERSSON: 13 Q What part of U.S. operations would you not 14 be in charge from? Is that the portion that 15 Mr. Choi would be overseeing? 16 A Right. 17 Q Okay. If you had to divide up what 18 portion of' the business you are in charge of versus 19 Mr. Choi, what are you in charge of for Mall 20 MakeshopNcompany, MallTail? 21 A That's kind of a complicated question, so 22 I don't know if I can put it into percentage. But respe e e e e ates a st a f I sa rna 25 approximately 50 percent or so. Pa 77 1 Q question was really -- thank you for 2 that. But my question really wasn't about 3 percentage of what you're in cha e of, but what 4 areas of the business you're in charge in. 5 So, you know, for example, you used to be 6 CFO. I imagine that means that you oversee finance, 7 accounting, et cetera. 8 What I'm trying to figure out is what else 9 falls under that 50 percent? 10 A As I said before, on paper I am shown as a 11 CFO. But I'm involved in the overall operation of 12 the branch in the United States. Although I don't 13 have a high authority, I am involved in the finance 14 accounting, personnel, general affairs, and the 15 general operations of the company in the U.S. I 16 won't say that I am in charge of everything, though. 17 Q Who is in charge of marketing and PR? 18 A Mainly it's handled in Korea. As I said 19 before, since majority of our customers are Korean, 20 that is mainly handled by the people who are charged 21 with in Korea. 22 Q Okay. But in the United States t a a a e f ai s I fa n r r e . 25 What falls un r Mr. Choi's purview? 78 1 A For example, with respect to the finance 2 and accounting, I reviewed the materials for the 3 monthly result and quarterly result and Mr. Seung 4 Choi, who is the executive director, would verify 5 it. And thereafter, the information could be 6 discussed within the headquarters as far as I know. 7 But beyond that, I don't know. 8 Q Okay. And so is it true then that 9 marketing and PR and even affiliate relationships 10 just are not handled in the United States? 11 A Affiliate. 12 Q So if there's a U.S. company that's an 13 affiliate, then one of you two would, for example, 14 interact with that person? 15 MR. ESENSTEN: I'm sorry, sorry to 16 interrupt, but did we get a translation on his 17 answer to the last question. 18 MR. PERSSON: Yeah, I think so. Didn't 19 we? Yeah, where he told me that Mr. Choi is the 20 executive director. He would look at results also, 21 et cetera. 22 MR. ESENSTEN: o y. I - e s a a a e. 25 THE INTERPRETER: May the interpreter 79 1 clarify with the witness, please? 2 MR. PERSSON: Sure. 3 (Interpreter confers with witness in 4 Korean. ) 5 THE WITNESS: Business model? So when you 6 say affiliate, are you referring to business model 7 or some kind of company name? 8 BY MR. PERSSON: 9 Q I'm talking about, you know, the 10 persons -- you know, we can return to that question. 11 I'm just trying to understand who -- who might -- if 12 there's anyone in the United States who oversees 13 marketing and PR and advertising and things like 14 that? 15 A I'm wondering if the -- the words that the 16 interpreter are using of the question for the 17 question asked by attorney, Spencer, are somewhat 18 different. Maybe there's a little different meaning 19 to it? 20 Q Well, I don't know how I can attest to 21 that. I can get my associate, who was supposed to 22 be here today, but didn't come en we thou t it was a e et er I n e s t o a 25 A With respect to the marketing and PR, 80 1 since we don't have any customers that we deal with 2 in the United States, there's no person here who is 3 in charge of it, so that is handled by someone in 4 Korea. 5 With respect to the advertisements, again, 6 to my recollection we have never a rtised in the 7 United States. 8 BY MR. PERSSON: 9 Q And when you say you have -- 10 A However 11 Q Go ahead. 12 A However, with respect to the affiliate 13 business in doing business with the affiliate 14 businesses, there is a person who handles the 15 communications with the advertisers, the networking 16 companies, and also communicates with the team in 17 Korea. 18 Q Is that it? 19 A Yes. 20 Q And who is that person? 21 A An employee named Jasmine Chang. 22 Q Is that Y E-S-M-I N-E or is it Jas ne in t a e 1- - t erta 25 of the spelling. 81 1 Now, you listed a bunch of different 2 operations that are in the U.S. and you said admin, 3 HR, finance, Vitatra Team, BD Team, MallTail 4 department, Taillist department, et cetera. 5 My question for you is: You as the 6 president who has duties of finance, accounting, 7 personnel affairs, you are overseeing all of that 8 personnel; is that right? 9 A Not everything. 10 Q What is it? 11 A So, for example, our company's controller 12 could override me and communicate with the CFO at 13 the headquarters in Korea. Therefore, I can't say 14 that I oversee everything. 15 Q Understood. You said earlier that you 16 don't have any customers in the United States. Are 17 you saying just that MakeshopNcompany as a shipping 18 entity doesn't have any customers? 19 A Yes, that's correct. 20 Q Okay. What about MallRee? Do they have 21 registered users in the United