Preview
FILED
DALLAS COUNTY
12/24/2014 12:08:19 PM
GARY FITZSIMMONS
DISTRICT CLERK
CAUSE NO. DC-12-12486
KJC AUTO TITLE LOAN CORP -- § IN THE DISTRICT COURT
NORTH TEXAS §
§
Plaintiff, §
§
v. § 116th JUDICIAL DISTRICT
§
WELLSHIRE FINANCIAL SERVICES, §
LLC d/b/a LOANSTAR TITLE LOANS §
§
Defendant. § DALLAS COUNTY, TEXAS
PLAINTIFF’S MOTION TO QUASH NOTICE OF DEPOSITION, OBJECTION TO
NOTICE OF DEPOSITION, AND MOTION FOR PROTECTIVE ORDER
TO THE HONORABLE JUDGE OF SAID COURT:
COMES NOW KJC Auto Title Loan Corp—North Texas (“Plaintiff”) and files this
Motion to Quash Notice of Deposition, Objection to Notice of Deposition, and Motion for
Protective Order (the “Motion”) and in support thereof would respectfully show as follows:
I.
Background
1. In connection with the scheduling of additional oral depositions in this matter, on
December 22, 2014 Wellshire Financial Services, LLC d/b/a LoanStar Title Loans (“Defendant”)
served the following: a) Amended Notice of the Oral and Videotaped Deposition of Dan
Borchardt for January 6, 2015 and a Subpoena to Dan Borchardt (the “Borchardt Notice”); b)
Notice of the Oral and Videotaped Deposition of Clifton H. Morris, III for January 5, 2015 (the
“Morris Notice”); and c) Notice of the Oral and Videotaped Deposition of KJC Auto Title Loan
Corp.—North Texas for January 15, 2015 (the “Corporate Notice”). A true and correct copy of
the foregoing Notices is attached hereto as Exhibit “1.”
MOTION FOR PROTECTIVE ORDER Page 1
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2. Plaintiff does not object to the Borchardt Notice. However, although counsel for
Plaintiff is available January 5, 2015, Clifton H. Morris, III (“Morris”), President of Defendant,
is unavailable that week due to travel. Due to the unavailability of Morris on January 5, 2015,
Plaintiff hereby objects to the Morris Notice. Pursuant to Rule 199.4, Plaintiff files this
objection within three (3) business days of the Morris Notice.
3. Plaintiff previously asserted a trade secret privilege in Plaintiff’s written
discovery responses and in oral depositions. Both the Morris Notice and the Corporate Notice
indicate that the depositions are “limited to topics that were the subject of the trade secret
objections from the deposition of July 17, 2013.” The Court issued an Order dated December
16, 2013 which overruled Plaintiff’s assertion of a trade secret privilege, “except to the extent of
revealing the manner in which compiled data is distributed to Plaintiff’s employees.”
4. In compliance with said Order, Plaintiff served amended discovery responses.
Defendant did not file any motion to compel regarding Plaintiff’s amended responses.
II.
Motion to Quash Morris Notice
5. Based upon the foregoing, Plaintiff requests the Court grant Plaintiff’s request for
an Order quashing the Morris Notice, and subject to the Court’s determination of Plaintiff’s
Objection and Motion for Protection herebelow, issue an Order mandating that the deposition of
Clifton H. Morris, III be scheduled at a date, time, and location agreeable to all parties.
III.
Objections to Morris Notice and Corporate Notice
6. Further, and in addition to the foregoing Motion to Quash Morris Notice, Plaintiff
objects to the Morris Notice and Corporate Notice for the following reasons:
MOTION FOR PROTECTIVE ORDER Page 2
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a) The Order specified that Plaintiff’s trade secret privilege was not
overruled in its entirety. Both the Morris Notice and the Corporate Notice indicate that the
depositions are “limited to topics that were the subject of the trade secret objections from the
deposition of July 17, 2013.” Plaintiff objects to the Morris Notice and Corporate Notice to the
extent the Notices attempt to solicit testimony which is not covered by the Court’s Order, such as
the “manner in which compiled data is distributed to Plaintiff’s employees.”
b) Plaintiff has already taken the depositions of Morris and the corporate
representative for Plaintiff, and will take the deposition of Dan Borchardt on January 6, 2015.
Morris and Karen Graham (“Graham”), Plaintiff’s Controller and corporate representative, gave
oral depositions in this matter approximately a year and a half ago on July 17, 2013. Plaintiff
objects that the Morris and Graham depositions revealed that Mr. Borchardt developed the trade
secret, and that only he and his wife were aware of how the trade secret worked.
Defendant’s prior notice of deposition of Plaintiff’s corporate representative for July 17,
2013 (the “2013 Corporate Notice”) included a list of topics to be covered in said deposition.
The list attached as Exhibit A to the Corporate Notice contains four (4) topics which are identical
to topics listed in the 2013 Corporate Notice. However, in her 2013 deposition as corporate
representative, Graham already testified that she did not have knowledge of certain topics
included in the 2013 Corporate Notice which are identical to those listed on Exhibit “A” to the
Corporate Notice. Further, Morris testified that he did not know the details of Plaintiff’s claimed
trade secret, but instead that Dan Borchardt and Mr. Borchardt’s wife were the only ones who
knew this information:
Q: Are you saying that you and Dan Borchardt are the only ones
who know of the trade secret?
MOTION FOR PROTECTIVE ORDER Page 3
N:\KJC\Loan Star - 2012 Suit\PLDG\Motion for Protection - Morris and KJC Rep.doc
A: I don’t know how he does it. He’s the only one who knows the
trade secret.
Q: And Dan developed this trade secret?
A: Yes.
[Morris Deposition, p. 31, l. 4-9]; and
Q: I want you to identify the ways that KJC uses to keep this trade
secret?
A: Only two people know about it.
Q: And is that you and Mr. Borchardt?
A: I don’t know about it either. It’s Dan and his wife, Paige.
We’ve purposely kept it with just two people in the company
knowing it.
[Morris Deposition, p. 34, l. 7-13].
Morris has already testified that he did not know the details of the trade secret, and that
Dan Borchardt, whom Defendant is deposing on January 6, 2015, is the witness with that
knowledge. Therefore, Plaintiff objects that the Morris Notice and Corporate Notice are
intended only to harass Plaintiff and its President, and to cause Plaintiff to incur unnecessary
expenses and attorney’s fees.
c) Defendant was dilatory in seeking additional discovery from Plaintiff, and
now imposes an unnecessary burden on Plaintiff. The Court issued its Order concerning
Plaintiff’s asserted trade secret privilege on December 19, 2013. However, Defendant waited
approximately a year, and until approximately thirty (30) days prior to the deadline for the
completion of discovery during the holiday season, before requesting additional depositions from
Morris and a corporate representative. The Corporate Notice requests Plaintiff to provide a
representative who can testify concerning: “the identity of all WFS’ customers whose identity
MOTION FOR PROTECTIVE ORDER Page 4
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was identified by KJC through motor vehicle records, including the date KJC accessed motor
vehicle records relating to that person and the means by which KJC obtained the license plate
information (or numbers) of each such person.”
Plaintiff objects that the foregoing request is overly broad and unduly burdensome.
Plaintiff avers that it has no representative with knowledge of this information, and that it would
take countless hours of investigation by Plaintiff to review the thousands of customer names
contained in spreadsheets produced by Plaintiff to Defendant herein to attempt to determine
which of those customers had previously been customers of Defendant. See Plaintiff’s response
to Interrogatory No. 3 of Defendant’s First Amended Response to Defendant’s Second Set of
Interrogatories in which Plaintiff responds, “Plaintiff generally has no way of identifying the
requested names because Plaintiff does not regularly track or maintain the reason(s) why a
prospective customer visits Plaintiff’s store locations in order to utilize Plaintiff’s services.”
Plaintiff objects that this request is unduly burdensome regardless of the context, but especially
on short notice of less than thirty (30) days during the holidays.
Another topic contained in Exhibit A to the Corporate Notice concerns “KJC’s actions in
accessing motor vehicle records.” Plaintiff’s responses to Interrogatory Nos. 13 and 14 of
Defendant’s Third Amended Response to Defendant’s First Set of Interrogatories, served in
compliance with the Order, specify that “Plaintiff does not access motor vehicle records” but
instead used information obtained from DataTrax, a third party provider of public information.
Further, Morris testified in his deposition that the only time Plaintiff accesses “DMV records” is
to validate whether there are any active liens on a customer’s car, all pursuant to a contract with
the Texas Department of Transportation. See, Morris Deposition, p. 15, l. 5-22.
MOTION FOR PROTECTIVE ORDER Page 5
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d) Plaintiff objects to the Morris Notice and Corporate Notice as dilatory tactics
designed to delay the final disposition of this matter. Plaintiff objects that in the Motion to
Withdraw and to Substitute New Counsel filed by Defendant on October 13, 2014, Defendant’s
counsel represented to the Court that the substitution of counsel was not sought for delay.
However, at the eleventh hour, in the last thirty (30) days of the discovery period as agreed to by
the parties, Defendant has already taken three (3) oral depositions with a fourth scheduled for
January 6, 2015, and served a Third and Fourth Request for Production. Plaintiff objects that the
Morris Notice and Corporate Notice constitute an attempt by Defendant to delay these
proceedings and to harass Plaintiff with a late flurry of discovery designed to disrupt Plaintiff’s
business operations, and cause Plaintiff to incur unnecessary expenses and attorney’s fees.
III.
Motion for Protective Order
7. In light of the foregoing objections which highlight the dilatory and unduly
burdensome nature of the Morris Notice and Corporate Notice, Plaintiff requests the Court
sustain its objections and enter an order protecting Plaintiff from the oral depositions sought by
Plaintiff.
WHEREFORE, PREMISES CONSIDERED, Plaintiff prays that its objections be
sustained and that this Motion be in all things granted, and for all such other and further relief,
both at law and in equity, to which Plaintiff may be justly entitled
Respectfully submitted,
HOW FRELS ROHDE WOODS & DUKE
A Professional Corporation
By: _/s/ Mark H. How__________________
MARK H. HOW
MOTION FOR PROTECTIVE ORDER Page 6
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State Bar No. 10059900
mhow@2027law.com
MARK FRELS
State Bar No. 07438200
BUDDY APPLE
State Bar No. 24059387
2027 Young Street
Dallas, Texas 75201
(214) 720-2220 Telephone
(214) 720-2240 Facsimile
ATTORNEYS FOR PLAINTIFF
CERTIFICATE OF CONFERENCE
This is to certify that counsel for Plaintiff and Defendant discussed the Morris Notice and
Corporate Notice in person at oral depositions on December 22, 2014, and that no consensus
regarding the Notices could be reached.
_/s/ Mark H. How_________________
MARK H. HOW
CERTIFICATE OF SERVICE
This is to certify that a true and correct copy of the foregoing is being served on all
counsel of record via facsimile and/or electronic service on the 24th day of December, 2014.
_/s/ Mark H. How_________________
MARK H. HOW
MOTION FOR PROTECTIVE ORDER Page 7
N:\KJC\Loan Star - 2012 Suit\PLDG\Motion for Protection - Morris and KJC Rep.doc
NO. DC-12-12486
KJC AUTO TITLE LOAN CORP -NORTH 3 IN THE DISTRICT COURT
TEXAS 3
3
Plaint$$ 3
3
v. 8 OF DALLAS COUNTY, TEXAS
3
WELLSHIRE FINANCIAL SERVICES, LLC 8
D/B/A LOANSTAR TITLE LOANS 3
3
Dejhdant. 3 116TH JUDICIAL DISTRICT
AMENDED NOTICE OF THE ORAL AND VIDEOTAPED
DEPOSITION OF DAN BORCHARDT
To: Dan Borchardt, 8307 Ashcroft Dr., Houston, Texas 77096- 1003.
Plaintiff, KJC Auto Title Loan Corp - North Texas, by and through its attorneys of
record, Mark H. How and Buddy Apple, How Frels Rohde Woods & Duke, PC, 2027
Young Street, Dallas, Texas 75201.
The oral and videotaped deposition of DAN BORCHAFWT will be taken by counsel for
defendant, Wellshire Financial Services, LLC d/b/a LoanStar Title Loans, at the law offices of
Sutherland Asbill & Brennan LLP, 1001 Fannin Street, 37th Floor, Houston, Texas 77002, on
Tuesday, January 6,2015, beginning at 10:OO a.m.
The deposition will be videotaped and transcribed and will be taken before an officer
authorized to administer oaths from Carlisle Reporting (713-864-4443). The deposition will
continue from day to day until completed.
Respectfully submitted,
SUTHEFtLAND ASBILL & BRENNAN LLP
By: /s/ Daniel Johnson
Daniel Johnson
State Bar No. 24046165
daniel.iohnson@,s,sutherland.corn
Stephany Olsen-LeGrand
State Bar No. 24065604
stephany.olsenlegrand@sutherland.com
Robert Lemus
State Bar No. 24052225
robert.lemus@sutherland com
1001 Fannin, Suite 3700
Houston, TX 77002-6760
Telephone: (713) 470-6100
Facsimile: (713) 654-1301
ATTORNEYS FOR DEFENDANT/COUNTER-
PLAINTIFFS WELLSHIRE FINANCIAL
SERWCES, LLCD/B/A LOANSTAR TITLE
LOANS
CERTIFICATE OF SERVICE
This is to certify that I have this day served all counsel of record with a copy of the
foregoing Notice of Oral and Videotaped Deposition in accordance with TEX. R. CIV. P.21 and
21a, as follows:
Mark H. How
Buddy Apple
How Frels Rohde Woods & Duke, PC
2027 Young Street
Dallas, Texas 75201
DATED: December 22.2014
/s/ Daniel Johnson
Daniel Johnson
NO. DC-12-12486
KJC AUTO TITLE LOAN CORP -NORTH § IN THE DISTRICT COURT
TEXAS §
§
Plaint8 §
§
v. 5 OF DALLAS COUNTY, TEXAS
§
WELLSHIRE FINANCIAL SERVICES, LLC 5
D/B/A LOANSTAR TITLE LOANS 5
§
Defendants. $5 116TH JUDICIAL DISTRICT
SUBPOENA TO DAN BORCHARDT
REOUIRING APPEARANCE AT DEPOSITION
THE STATE OF TEXAS
Issued on December 22,2014
WITNESS: DAN BORCHARDT
8307 Ashcroft Dr.
Houston, Texas 77096-1003
TO ANY SHERIFF OR CONSTABLE OF THE STATE OF TEXAS OR OTHER
PERSON AUTHORIZED TO SERVE AND EXECUTE SUBPOENAS AS PROVIDED IN
TEXAS RULE OF CIVIL PROCEDURE 176.
YOU ARE HEREBY COMMANDED TO SUMMON DAN BORCHARDT, who may
be served at 8307 Ashcroft Dr., Houston, Texas 77096-1003, to appear at the law firm of
Sutherland Asbill & Brennan LLP, 1001 Fannin Street, 37"' Floor, Houston, Texas 77002 (713-
470-6100) on Tuesday, January 6,2015, at 9:00 a.m., to give testimony in the above-entitled and
numbered cause at a deposition and remain in attendance from day to day until lawfully
discharged.
The subpoena was issued at the request of Defendant, Wellshire Financial Semcies, LLC
d/b/a LoanStar Title Loans, whose attorney of record is:
Daniel Johnson
ex as State Bar No. 24046165
Sutherland Asbill & Brennan LLP
1001 Fannin Street, Suite 3700
Houston, Texas 77002
Telephone: 713-470-6100
Facsimile: 713-654-1301
Email: daniel.johnson@sutherland.com
CONTEMPT: FAILURE BY ANY PERSON WITHOUT ADEQUATE EXCUSE
TO OBEY A SUBPOENA SERVED UPON THAT PERSON MAY
BE DEEMED A CONTEMPT OF THE COURT FROM WHICH
THE SUBPOENA IS ISSUED OR A DISTRICT COURT IN THE
COUNTY IN WHICH THE SUBPOENA IS SERVED AND MAY BE
PUNISHED BY FINE OR CONFINEMENT, OR BOTH. TEX. R.
CIV. P. 176.8(a).
Texas State Bar 24046165
SUTHERLAND ASBILL & BRENNAN LLC
1001 Fannin.Street, Suite 3700
Houston, Texas 77002
Telephone: 713-470-6100
Facsimile: 713-654-1301
Email: daniel.johnson@sutherland.com
SUBPOENA FOR WITNESS DEPOSITION
RETURN
Came to hand the day of December, 2014, at o'clock . M . , and
executed the day of ,201-, at o'clock . M., by delivering
to the within named DAN BORCHARDT in person at
in County, Texas,
a true copy of this Subpoena, and tendering said witness the sum of $
By Deputy:
person who is not a party to the suit, and is not less than 18 years of age
ACCEPTANCE OF SERVICE OF SUBPOENA BY WITNESS PER RULE 176 T.R.C.P.
I, the undersigned witness named in the Subpoena, acknowledge receipt of a copy thereof, and
hereby accept service of the attached Subpoena, and will appear at said location on said date and
time directed in this Subpoena.
Rule 176.8(n) Contempt. Fnilrcre by any person witliout ndequnte excuse to obey n subpoeizn
served upon tltnt person mny be deemed n contempt of the court from wlzich tlze subpoena is
issued or n district court it1 the county in wlzich the subpoeizn is served, nnd may be punislzed
by fine or conjiizement, or botlz.
Signature of Witness Date
...............................................................'..............,
Not executed as to the witness DAN BORCHARDT for the following reasons:
FEE FOR SERVICE OF SUBPOENA: $
NO. DC-12-12486
KJC AUTO TITLE LOAN CORP -NORTH § IN THE DISTRICT COURT
TEXAS 4
§
v. § OF DALLAS COUNTY, TEXAS
§
WELLSHIRE FINANCIAL SERVICES, LLC §
D/B/A LOANSTAR TITLE LOANS §
§
Defendant. 8 116TH JUDICIAL DISTRICT
NOTICE OF THE ORAL AND VIDEOTAPED
DEPOSITION OF CLIFTON H. >IOHlUS, I11
To: Plaintiff, KJC Auto Title Loan Corp - North Texas, by and through its attorneys of
record, Mark H. How and Buddy Apple, How Frels Rohde Woods & Duke, PC, 2027
Young Street, Dallas, Texas 75201.
The oral and videotaped deposition of CLIFTON H. MORRIS, 111, will be taken by
counsel for defendant, Wellshire Financial Services, LLC d/b/a LoanStar Title Loans, at the law
offices of How Fres Rohde Woods & Duke, 2027 Young Street, Dallas, Texas 75201, on
Monday, January 5, 2015, beginning at 10:OO a.m., or at other such time and place agreed upon
by the parties. This deposition is limited to topics that were the subject of the trade secret
objections from the deposition of July 17,2013.
The deposition will be videotaped and transcribed and will be taken before an officer
authorized to administer oaths from Carlisle Reporting (713-864-4443). The deposition will
continue from day to day until completed.
Respectfully submitted,
SUTHElUAND ASBILL & BRENNAN LLP
By: /s/ Daniel Johnson
Daniel Johnson
State Bar No. 24046165
danieljohnson@sutherland.com
Stephany Olsen-LeGrand
State Bar No. 24065604
stephany. olsenlegrand@sutherland com
Robert Lemus
State Bar No. 24052225
robert.lemus@sutherland.com
1001 Fannin, Suite 3700
Houston, TX 77002-6760
Telephone: (713) 470-6100
Facsimile: (713) 654-1301
ATTOXNEYS FOR DEFENDANT/COUNTER-
PLAINTIFFS WELLSHIRE FZNANCUL
SERVICES, LLCD/B/A LOANSTAR TITLE
LOANS
CERTIFICATE OF SERVICE
This is to certify that I have this day served all counsel of record with a copy of the
foregoing Notice of Oral and Videotaped Deposition in accordance with TEX. R. CIV. P.21 and
21a, as follows:
Mark H. How
Buddy Apple
How Frels Rohde Woods & Duke, PC
2027 Young Street
Dallas, Texas 75201
DATED: December 22.2014
/s/ Daniel Johnson
Daniel Johnson
NO. DC-12-12486
KJC AUTO TITLE LOAN CORP -NORTH 5 IN THE DISTRICT COURT
TEXAS 5
5
Plaint@ §
5
OF DALLAS COUNTY. TEXAS
WELLSHIRE FINANCIAL SERVICES, LLC 5
D/B/A LOANSTAR TITLE LOANS 5
Defendant. 116TH JUDICIAL DISTRICT
NOTICE OF THE ORAL AND VIDEOTAPED DEPOSITION OF
KJC AUTO TITLE LOAN COW.-NORTH TEXAS
To: Plaintiff, KJC Auto Title Loan Corp - North Texas, by and through its attorneys of
record, Mark H. How and Buddy Apple, How Frels Rohde Woods & Duke, PC, 2027
Young Street, Dallas, Texas 75201.
The oral and videotaped deposition of the corporate representative of KJC AUTO
TITLE LOAN CORE'.-NORTH TEXAS with the most knowledge concerning the topics set
forth in Exhibit A will be taken by counsel for defendant, Wellshire Financial Services, LLC
d/b/a Loanstar Title Loans, at the law offices of How Fres Rohde Woods & Duke, 2027 Young
Street, Dallas, Texas 75201, on Thursday, January 15, 2015, beginning at 10:OO a.m., or at other
such time and place agreed upon by the parties. This deposition is limited to topics that were the
subject of the trade secret objections from the deposition of July 17, 2013, which are set forth in
Exhibit A.
The deposition will be videotaped and transcribed and will be taken before an officer
authorized to administer oaths from Carlisle Reporting (713-864-4443). The deposition will
continue from day to day until completed.
Respectfully submitted,
SUTHERLAND ASBILL & BRENNAN LLP
By: Is/ Daniel Johnson
Daniel Johnson
State Bar No. 24046165
danieljohnson@sutherland.corn
Stephany Olsen-LeGrand
State Bar No. 24065604
stephany. olsenlegrand@sutherland.com
Robert Lemus
State Bar No. 24052225
robert. lernus@sutherland.corn
1001 Fannin, Suite 3700
Houston, TX 77002-6760
Telephone: (713) 470-6 100
Facsimile: (713) 654-1301
ATTORNEYS FOR DEFENDANT/COUNTER-
PLAINTIFFS WELLSHIREFINANCIAL
SERVICES, LLC D/B/A LOANSTAR TITLE
LOANS
CERTIFICATE OF SERVICE
This is to certify that I have this day served all counsel of record with a copy of the
foregoing Notice of Oral and Videotaped Deposition in accordance with TEX. R. CIV. P.21 and
21a, as follows:
Mark.H. How
Buddy Apple
How Frels Rohde Woods & Duke, PC
2027 Young Street
Dallas, Texas 75201
DATED: December 22,2014
/s/ Daniel Johnson
Daniel Johnson
EXHIBIT A
Defendant Wellshire Financial Services, LLC, ("WFS") requests that Plaintiff KJC Auto
Title Loan Corp.-North Texas ("KJC") designate and provide a corporate representative who
has knowledge of the following matters to give a deposition and provide testimony:
1. KJC's actions in obtaining and identifying WFS' customers to approach them about
paying off their loan with WFS.
2. KJC's actions in accessing motor vehicle records in connection with its business and the
reasons for doing so and the means by which KJC does so.
3. The identify of all WFS' customers whose identity was identified by KJC through motor
vehicle records, including the date KJC accessed motor vehicle records relating to that
person and the means by which KJC obtained the license plate information (or numbers)
of each such person.
4. The information KJC gives its employees and agents to identify and obtain the identify of
WFS' customers.
Please note that these topics were previously noticed for the July 17, 2013 corporate
representative, and counsel for plaintiff specifically identified these topics as ones to which
plaintiff objected and would not provide testimony. On December 16, 2013, the court issued an
order which overruled plaintiffs trade secret objection. Thus, defendant intends to complete the
deposition on these topics.