NETGEAR, Inc. v. Choice Electronics Inc. — Netgear must produce documents about alleged false stolen-product reports, but need not pursue discovery tied only to trademark-enforcement motives and attorney’s fees

Background

This discovery order, issued by United States Magistrate Judge Alex G. Tse on October 29, 2026 in the Northern District of California, addresses two groups of requests for production served by Choice Electronics in its litigation with Netgear. The first group, RFPs 80–88, concerns Netgear’s alleged practice of telling Amazon that resellers were selling stolen Netgear products. Choice contended that Netgear’s business model involved making false reports so that resellers would be removed from the market. The court explained that, if supported, such evidence could help Choice prove malice in connection with its defamation counterclaim.

The second group, RFPs 25–33, sought documents about Netgear’s efforts to enforce its trademarks in disputes with third-party resellers and documents concerning retail pricing of Netgear products. Choice argued that these requests could illuminate Netgear’s motivation for pursuing trademark-infringement claims. It also suggested that the motivation evidence might bear on attorney’s fees. The order therefore considered whether the requested material was relevant to a claim or defense and whether the production demanded from Netgear was proportional.

The Court’s Holding

The court ordered Netgear to produce, by November 13, 2026, all nonprivileged responsive documents in its possession, custody, or control for RFPs 80–88, subject to two limitations. It rejected Netgear’s argument that malice evidence must be specific to the plaintiff and cannot include possible malice toward third parties. Relying on Overstock.com, Inc. v. Gradient Analytics, Inc., the court explained that a defendant’s business model of publishing negative reports about public companies to promote short selling supported an inference of malice. Choice was attempting to make an analogous connection between Netgear’s alleged reporting practices and malice.

The first limitation imposed a uniform date range of January 1, 2024, to the present on all of RFPs 80–88. Although some requests already contained that range, others did not. The court found that the range addressed Netgear’s proportionality concerns and that Choice had not demonstrated a need for documents predating 2024. The second limitation concerned RFP 80. Netgear must produce documents sufficient to identify all Netgear products for which purported shortages were reported by or with Amazon, but it need not produce every responsive purchase order, invoice, inventory tracking report, Amazon communication, shipment notification, and delivery notification. The court reasoned that requiring all of those expansive categories would be inconsistent with the request’s opening limitation to documents “sufficient to identify” the products.

The court reached a different result for RFPs 25–33: Netgear need not respond further. Choice had not explained how Netgear’s motivation for trademark enforcement was relevant to any claim or defense. Its attorney’s-fees theory also failed because Choice cited no authority supporting fact discovery relating only to attorney’s fees rather than to a claim or defense. The order thus compelled limited production concerning the alleged stolen-product reports while ending the additional trademark-enforcement and pricing discovery at issue.

Key Takeaways

• Evidence about alleged false reports concerning third-party resellers can be discoverable to prove malice in a defamation counterclaim; it need not invariably be plaintiff-specific.
• Netgear must produce nonprivileged documents responsive to RFPs 80–88 by November 13, 2026, but only within the January 1, 2024-to-present date range imposed by the court.
• RFP 80 requires documents sufficient to identify products associated with purported shortage reports, not every listed purchase order, invoice, inventory record, communication, and shipping document.
• Choice did not obtain further responses to RFPs 25–33 because it failed to connect Netgear’s trademark-enforcement motivation and retail-pricing materials to a claim or defense.
• The court declined to authorize fact discovery justified solely by a possible attorney’s-fees issue when Choice supplied no supporting authority for that approach.

Why It Matters

The order ties the permissible scope of discovery to the particular evidentiary use offered for each request. Alleged business-model evidence survived Netgear’s plaintiff-specific-malice objection because it could support an inference relevant to Choice’s defamation counterclaim, but the court narrowed the production by date and by the identifying function of RFP 80.

For the trademark-related requests, a general assertion that enforcement motives might be illuminating was insufficient without an explained connection to a claim or defense. The ruling does not decide the merits of Netgear’s trademark-infringement claims or Choice’s defamation counterclaim; it resolves only the specified discovery obligations before the magistrate judge.