People Center, Inc. v. Deel, Inc., No. 25-cv-02576-CRB (LJC) (N.D. Cal. Nov. 6, 2026), full opinion (PDF)
A party whose request to inspect an opposing executive's phone was denied can renew it once discovery strengthens its record. In a suit accusing a competitor of corporate espionage, the court had allowed inspection of the competitor's chief executive's devices. It refused inspection for his father, the chief financial officer. On renewal, the court ordered forensic data produced from the father's two iPhones. The order also covered a newer iPhone the chief executive acquired after his last contact with the employee at the center of the case. The court relied on new evidence that the chief executive deleted a message and kept using disappearing messages after suit.
The court also discounted a defense expert's report that the newer phone held no earlier data. In the court's view, the report did not describe the expert's search in enough detail to test.
What happened
The plaintiff alleges that a competitor recruited one of the plaintiff's employees as a spy. The employee's affidavit describes communications with the two executives through WhatsApp and Telegram. He attested that the Telegram chats were set to delete automatically. The affidavit also describes cryptocurrency payments to the employee.
The earlier denial left the plaintiff free to renew if discovery produced stronger support. The renewed request sought 16 forensic artifacts. These relate largely to messaging apps, call history, notifications, and contacts. User-generated content stayed subject to a first-look protocol already in place.
The court's analysis
In the court's view, the Federal Rules set no heightened standard for a forensic examination. The court weighed privacy and invasiveness within the ordinary Rule 26 balancing. It repeated its earlier view that forensic examination is particularly invasive. The court added that the intrusion is especially serious when the requesting party is a commercial competitor seeking data that belongs to the other company's top executives.
On relevance, the court reasoned that a new phone can carry data that predate its purchase, restored through device or application backups. The defense expert reported finding no trace of earlier data on the chief executive's newer phone. The court discounted that report because the expert had not described his methodology in enough detail. Without that detail, neither the opposing expert nor the court could assess whether his search was comprehensive.
On proportionality, the court relied on evidence that had surfaced since its first order. The plaintiff presented evidence that the chief executive deleted a LinkedIn message. The employee attested that the executive sent it to him shortly after the employee was served with a preservation order. The competitor did not dispute evidence that the chief executive kept using a disappearing-message function after the suit was filed, including with his father.
The court acknowledged that ephemeral messaging on its own does not necessarily establish grounds to suspect unlawful conduct. On this record, the court concluded, the chief executive's use of it did establish such grounds. The court also cited calls he exchanged with his father close in time to the employee's receipt of cryptocurrency payments.
Relying on its expert, the competitor argued that the plaintiff's conclusions from this evidence were overblown. The court answered that a requesting party need not make a substantial showing or prove wrongdoing to establish that discovery is relevant or proportional. Taken as a whole, the court concluded, the record showed the requests were not a fishing expedition.
The court treated the narrower request as further support for proportionality. It contrasted the renewal with the earlier examination, which had swept more broadly. The defense expert had raised concerns that 107 artifacts amounted to a vast trove of revealing data. The plaintiff responded by reducing the number to 16. In the court's view, that scope, the first-look requirement, and the protective order reasonably mitigated the burdens, including the executives' privacy concerns.
Why it matters
A party whose request for device inspection was denied should identify the support its record was missing. Evidence from an inspection a court has already allowed, such as a deleted message or disappearing messages used after suit, can supply that support.
A requesting party facing a privacy objection can answer it by narrowing its request to specific forensic artifacts. Pairing a short list with a first-look screen and a protective order gives a court a concrete basis to find the burden mitigated.
Once a duty to preserve attaches, a company should turn off disappearing-message settings for its key custodians. An executive who keeps those settings on after suit invites a court to weigh that conduct when deciding how far discovery reaches.
A party resisting inspection through an expert should have the expert describe the search, including the tools, the sources examined, and the steps taken. A report that a device holds no earlier data persuades only when the court can test the method behind the report.
The full opinion is available as a PDF.
