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United States v. Sensient Colors

September 9, 2009

UNITED STATES OF AMERICA, PLAINTIFF,
v.
SENSIENT COLORS, INC., DEFENDANT.



The opinion of the court was delivered by: Joel Schneider United States Magistrate Judge

[Doc. No. 143]

OPINION

This Opinion addresses whether plaintiff waived its privilege and work-product objections to documents it inadvertently produced. The Court will also decide whether plaintiff must produce its documents regarding its search for potentially responsible parties ("PRPs"), and whether Cancro Exhibit 10 is privileged. This matter is before the Court on defendant Sensient Colors, Inc.'s "Motion to Compel Production of Documents from Plaintiff United States." [Doc. No. 143]. The Court received plaintiff's opposition [Doc. No. 149] and Sensient's reply [Doc. No. 152], and conducted oral argument. The Court also reviewed in camera the documents in question and plaintiff's confidential June 25, 2009 submission. For the reasons to be discussed defendant's motion is GRANTED in part and DENIED in part.

Background

The background facts of the case have already been set forth and will not be repeated in detail herein. See U.S. v. Sensient Colors, Inc., F. Supp. 2d , 2009 WL 2222798 (D.N.J. 2009). Only the facts relevant to the present discovery dispute will be summarized.

Plaintiff produced approximately 45,000 documents (135,000 pages) to defendants on six (6) different days between May 14, 2008 and February 12, 2009. Michele (Dusty) Strong Decl. ¶3.*fn1 These documents comprised 450 boxes.*fn2 On August 29, 2008, defendant returned 81 documents it deemed privileged. On September 10, 2008, plaintiff advised defendant that 80 of the 81 documents were privileged and were inadvertently produced. On October 23, 2008, defendant identified and returned another 89 privileged documents. Plaintiff produced a supplemental privilege log on November 21, 2008 claiming that most of the inadvertently produced documents were subject to attorney-client or work product protection.

At the deposition of former EPA employee Anthony Cancro on December 11, 2008, plaintiff claimed that Exhibit Cancro-10 was privileged. At the deposition of former EPA employee Richard Salkie on December 12, 2008, plaintiff claimed that Exhibit Salkie-10 was privileged.*fn3 Plaintiff also claimed these documents were inadvertently produced. On March 18, 2009, plaintiff identified another document as inadvertently produced. Plaintiff confirmed this document was inadvertently produced on March 23, 2009.

In its April 27, 2009 response to Sensient's motion plaintiff wrote that it acquired a new computer application ("Equivio") and it commenced a "re-review of its entire 47,000 document database." Brief at 9 n. 3, Doc. No. 149. Plaintiff also wrote that it would "promptly notify Defendant of any additional inadvertently disclosed privileged information identified through this process." Id. In June 2009, plaintiff identified 91 more inadvertently produced documents. On July 20, 2009, in response to defendant's July 8, 2009 letter, plaintiff identified three additional inadvertently produced documents. Doc. No. 195 at 3-4, 7-8. On August 6, 2009, plaintiff identified six more inadvertently produced documents. On August 7, 2009, plaintiff's counsel finally represented to the Court that its privilege review was completed.

Plaintiff claims that it reviewed 47,000 documents for relevancy, responsiveness, "and for privilege and other applicable protections." Brief at 2. After its review plaintiff produced 45,000 documents. Plaintiff claims that in designing and implementing its privilege review and production of documents and privilege logs, it relied upon the Discovery Plan it negotiated with defendant. Id. at 2-3. The Discovery Plan addressed, inter alia, waiver and inadvertent production issues.

The Declarations of Michele (Dusty) Strong (Litigation Support Manager and Coordinator with the Office of Litigation Support, Executive Office, Environment and Natural Resources Division, United States Department of Justice) and David L. Weigert, Esquire (plaintiff's litigation counsel) describe the steps plaintiff took to perform its privilege review. Plaintiff relied upon twelve attorneys and paralegals from the U.S. Department of Justice and EPA to perform its review. Strong Decl. ¶4. Plaintiff conducted "an entirely electronic privilege review without the use of hardcopy documents or forms." Id. at ¶5. Plaintiff prepared a database of relevant fields of each of its documents which was accessible by the EPA in New York and the Department of Justice in Washington. Id. ¶¶7, 10, 11. Plaintiff also conducted oral and written training for all attorney and paralegal privilege reviewers. Weigert Decl. ¶2. Plaintiff claims that after its preliminary review but prior to its production it performed computer assisted QA/QC measures to minimize mistakes. Strong Decl. ¶¶12 - 18.

In total, plaintiff has identified 214 inadvertently produced documents: (1) 53 documents identified in defendant's August 29, 2008 letter and confirmed in plaintiff's September 10, 2008 letter, (2) 61 documents identified in defendant's October 23, 2008 letter and confirmed in plaintiff's November 21, 2008 letter, (3) 91 documents identified in June 2009 (including Cancro-10), (4) 3 documents identified in plaintiff's July 20, 2009 letter, and (5) 6 documents identified in plaintiff's August 6, 2009 letter.

Discussion

Joint Discovery Plan

Plaintiff argues the parties' "Joint Rule 26(f) Report, Proposed Discovery Plan, and [Proposed] Order" ("Discovery Plan") [Doc. No. 144-8], precludes a privilege waiver.*fn4 This argument is rejected. Nowhere in the Discovery Plan does it mention that the parties are excused form the requirements of Federal Rule of Evidence 502(b), or the principles enunciated in Ciga-Geigy Corp. v. Sandoz Ltd., 916 F. Supp. 404 (D.N.J. 1996).*fn5 The Court agrees with Sensient (Reply Brief at 4, Doc. No. 152), that paragraph VI of the Discovery Plan would be superfluous if the non-waiver provision was intended to protect the disclosure of all privileged documents under any circumstance.

Plaintiff and Sensient are represented by sophisticated counsel. If they intended to implement a "clawback" provision this would have been specifically mentioned.*fn6 The most sensible construction of the parties' Discovery Plan is that the inadvertent production of a document "in and of itself" does not waive a privilege. In other words, the parties agreed not to subject themselves to the harsh rule that a mere inadvertent production results in a waiver. See Carter v. Gibbs, 909 F.2d 1450, 1451 (Fed. Cir. 1990); In re Sealed Case, 877 F.2d 976, 980 (D.C. Cir. 1989). The Court agrees with defendant that the parties intended to incorporate the "flexible" standard (discussion infra), to determine if a waiver occurred. This is supported by Koch Materials Co. v. Shore Slurry Seal, Inc., 208 F.R.D. 109, 118 (D.N.J. 2002), wherein it noted that courts do not favor broad disclosure provisions similar to the interpretation plaintiff advocates:

Courts generally frown upon "blanket" disclosure provisions as contrary to relevant jurisprudence.... In particular, the court observes that such blanket provisions, essentially immunizing attorneys from negligent handling of documents, could lead to sloppy attorney review and improper disclosure which could jeopardize clients' cases. Moreover, where the interpretation of the provision remains hotly disputed, ..., broad construction is ill advised.

See also Ciba-Geigy, 916 F. Supp. at 412. Since the Court finds that the parties' Discovery Plan does not preclude a waiver of the attorney-client privilege or work-product protection, ...


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