Ameripride Svc Inc v. Valley Industrial, et al

Filing 855

ORDER signed by Judge Lawrence K. Karlton on 12/15/11: This court clarifies its November 15, 2011 order and determines that: (1) AmeriPrides "claw back" request under Federal Rule of Civil Procedure 26(b)(5)(B) as related to the "Memor andum from in-house counsel, B.P. Berry re: environmental audit of each plant, with attachments" and as described above, is DENIED. (2) The parties' stipulation and proposed order permitting the filing of those documents under seal, ECF No. 780, is DENIED as moot. (Kaminski, H)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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AMERIPRIDE SERVICES, INC.,
A Delaware corporation,
NO. CIV. S-00-113 LKK/JFM

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Plaintiff,
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v.
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VALLEY INDUSTRIAL SERVICE, INC.,
a former California corporation,
et al.,
O R D E R

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Defendants.
/

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AND CONSOLIDATED ACTION AND
CROSS- AND COUNTER-CLAIMS.
/

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On November 15, 2011, this court issued an order in the

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above-captioned case finding that no good cause existed to amend

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the scheduling order and, thus, the court denied Defendant TEO’s

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request to amend the scheduling order for the purposes of filing

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a motion to compel.

Order, ECF No. 808.

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On November 22, 2011, Defendant Texas Eastern Overseas, Inc.

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(“TEO”) filed a request for clarification of the court’s order,
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specifically with regard to AmeriPride’s previous request to “claw-

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back” documents which it inadvertently produced, in accordance with

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Federal Rule of Civil Procedure 26(b)(5)(B).1

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No.

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(“AmeriPride”) filed an opposition to Defendant’s request for

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clarification. Pl’s Opp’n, ECF No. 848. The court agrees that its

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prior order should be clarified with regards to the claw-back

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request.

825.

In

response,

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Plaintiff

Def’s Request, ECF

AmeriPride

Services

Inc.

BACKGROUND
At issue are forty-seven pages of documents “bearing the bates

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range

ASI0254698-ASI0254745”

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memorandum by Mr. Berry, an attorney for American Linen Supplies,

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regarding environmental audits of each plant and sent to the

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company’s

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AmeriPride’s August 26, 2011 document production” to TEO.

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Oct. 6, 2011 Letter to Def., ECF No. 799, Ex. W; Pl’s Sept. 16,

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2011 Letter to Def., ECF No 799, Ex. L.

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deposition of B.P. Berry, Jr., Mr. Berry was employed as only

managers),

which

and

were

including

“document

“inadvertently

52"

included

(a

in
Pl’s

According to the

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Federal Rule of Civil Procedure 26(b)(5)(B) provides: “If
information produced in discovery is subject to a claim of
privilege or of protection as trial-preparation material, the party
making the claim may notify any party that received the information
of the claim and the basis for it. After being notified, a party
must promptly return, sequester, or destroy the specified
information and any copies it has; must not use or disclose the
information until the claim is resolved; must take reasonable steps
to retrieve the information if the party disclosed it before being
notified; and may promptly present the information to the court
under seal for a determination of the claim. The producing party
must preserve the information until the claim is resolved.” FED.
R. CIV. P. 26(b)(5)(B).
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lawyer at American Linen Supplies, until his retirement in 1997.

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Shapp Decl., ECT No. 801, Ex. 7, Berry Dep., 16:7-11; 161:24-162:3.

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Along with AmeriPride’s August 26th production of documents

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to

TEO,

AmeriPride

included

a

privilege

log,

which

did

not

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incorporate by reference a privilege log that AmeriPride had

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previously produced in 2000, and which also did not include any

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reference to “document 52.”

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799, Ex. H.

See AmeriPride Privilege Log, ECF No.

However, in its August 26, 2011 letter prefacing its

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privilege

log,

AmeriPride

stated,

“AmeriPride

is

producing

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privilege logs previously produced by AmeriPride in the course of

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this litigation.

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ASI0322894-ASI0323224.”

These prior privilege logs bear the bates range
Id. at Pl’s Aug. 26, 2011 Letter.

On September 16, 2011, AmeriPride reasserted a claim of

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privilege as to document 52 that AmeriPride had previously asserted

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in its 2000 privilege log. Pl’s Sept. 16, 2011 Letter to Def., ECF

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No. 799, Ex. L; see also Pl’s 2000 Privilege Log, ECF No. 799, Ex.

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I.

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of AmeriPride’s inadvertent disclosure of the documents currently

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at issue, in accordance with Federal Rule of Civil Procedure

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26(b)(5)(B).

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W.

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first became aware of the inadvertent disclosure upon review of the

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draft Joint Statement Regarding Discovery Disagreement provided by

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TEO, which was sent to AmeriPride via email at 5:56 p.m. on October

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5, 2011.”

On October 6, 2011, AmeriPride sent TEO a letter notifying TEO

Pl’s Oct. 6, 2011 Letter to Def., ECF No. 799, Ex.

According to AmeriPride’s October 6, 2011 letter, “AmeriPride

Id. at 2.

As a supplement to its October 6, 2011
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letter, AmeriPride attached a Supplemental Privilege Log relating

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to its August 26, 2011 production of documents, in which AmeriPride

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named the documents currently at issue and described them as

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“Memorandum from in-house counsel re: environmental audit of each

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plant, with attachments.”

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Id. at Suppl. Priv. Log.

TEO asserts that it has sequestered the documents at issue,

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Joint Statement, ECF No. 797, at 5, as required by Federal Rule of

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Civil Procedure 26(b)(5)(B).

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AmeriPride argues that it is entitled to assert attorney-

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client and work product privileges for the documents at issue, and

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that, as to document 52, “AmeriPride’s privilege claim has been

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known to TEO since at least December 11, 2000.”

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ECF No. 797, at 6, 15, 18-19.

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Joint Statement,

ANALYSIS
A. Work Product Doctrine

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The work product doctrine is codified in Rule 26(b)(3) of the

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Federal Rules of Civil Procedure, which protects from discovery

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“documents and tangible things that are prepared in anticipation

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of

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representative.”

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Jury Subpoena, 357 F.3d 900, 906 (9th Cir. 2004).

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claiming the privilege, Plaintiff AmeriPride bears the burden of

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establishing that the documents claimed as work product were in

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fact prepared in anticipation of litigation.

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Inc. v. Convio, Inc., 219 F.R.D. 503, 507 (S.D. Cal. 2003).

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litigation

or

for

trial

by

or

for

another

party

or

its

FED. R. CIV. P. 26(b)(3); see also In re Grand
As the party

See, e.g., Kintera,

In order for a document to be protected, it must have been
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“created because of anticipated litigation, and would not have been

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created in substantially similar form but for the prospect of that

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litigation.”

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citations omitted).

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assembled in the ordinary course of business.

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161 F.R.D. 687, 698-99 (C.D. Cal. 1995).

In re Grand Jury Subpoena, 357 F.3d at 908 (internal
The doctrine does not protect materials
Griffith v. Davis,

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AmeriPride argues only that the documents currently at issue

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are protected by the attorney work-product doctrine because they

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were “prepared by in-house counsel, [and] represent[] his mental

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impressions,”

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description on AmeriPride’s October 6, 2011 supplemental privilege

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log [are] information provided to in-house counsel for AmeriPride,

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or were otherwise intended to be kept confidential in order to

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obtain legal advice.”

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According

and

to

that

“[t]he

attachments

identified

in

the

Joint Statement, ECF No. 797, at 18-19.

AmeriPride’s

October

6,

2011

Supplemental

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Privilege Log, the “claw-back” documents currently at issue were

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produced on April 18, 1989. Suppl. Privilege Log, ECF No. 799, Ex.

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W. Litigation in the instant case began in January 2000. The fact

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that the memorandum regarding environmental audits of each plant

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from Mr. Berry, American Linen Supplies’ in-house counsel, to the

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company managers was produced eleven years prior to the this

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litigation does not, by itself, preclude the possibility that the

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memorandum was produced “in anticipation of” litigation. However,

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because AmeriPride makes no argument that the documents at issue

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were either prepared because of anticipated litigation, or but for

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the prospect of that litigation, see Joint Statement, ECF No. 797,
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at 18-19, AmeriPride fails to meet its burden in establishing that

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the documents at issue are protected by the work-product doctrine.

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B. Attorney Client Privilege

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The attorney-client privilege protects “communications between

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client and attorney for the purpose of obtaining legal advice,

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provided such communications were intended to be confidential.”

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Gomez v. Vernon, 255 F.3d 1118, 1131 (9th Cir. 2001). “Because the

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attorney-client privilege has the effect of withholding relevant

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information from the fact-finder, it is applied only when necessary

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to achieve its limited purpose of encouraging full and frank

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disclosure by client to his or her attorney.”

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Commerce Nat’l Bank, 974 F.2d 127, 129 (9th Cir. 1992) (citing

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Fisher v. United States, 425 U.S. 391, 403, 96 S.Ct. 1569, 48

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L.Ed.2d 39 (1976)). In other words, the attorney-client privilege

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is strictly construed.

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(9th Cir. 2009) (quoting United States v. Martin, 278 F.3d 988, 999

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(9th Cir. 2002)).

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Clarke v. American

United States v. Ruehle, 583 F.3d 600, 607

An eight-part test determines whether information is covered
by the attorney-client privilege:
(1) Where legal advice of any kind is sought (2)
from a professional legal adviser in his capacity
as such, (3) the communications relating to that
purpose, (4) made in confidence (5) by the client,
(6) are at his instance permanently protected (7)
from disclosure by himself or by the legal advisor,
(8) unless the protection be waived.

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U.S. v. Graf, 610 F.3d 1148, 1156 (9th Cir. 2010).

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asserting the privilege, Plaintiff AmeriPride bears the burden of
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As the party

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proving each essential element. Id. (internal citations omitted).

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Here, AmeriPride argues that the documents at issue were

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prepared by Mr. Berry, the only attorney for American Linen

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Supplies and “sent directly . . . to the company managers” in

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regards to an environmental audit of each plant.

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ECF No. 797, 15-16.

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memorandum

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constitutes a communication “from a professional legal adviser in

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his capacity as such” and “relating to that purpose,” it is not

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clear to the court, and AmeriPride makes no argument showing, that

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Mr. Berry produced the memorandum at issue in response to “legal

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advice . . . sought” by the company.

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therefore failed to meet its burden in establishing that the

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documents at issue are protected by attorney-client privilege.

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C. Waiver

produced

Joint Statement,

Although the court is satisfied that a
by

in-house

counsel

to

company

See id.

managers

AmeriPride has

Even if the documents at issue were protected by the work

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product

doctrine

and

attorney

client

privilege,

Plaintiff

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AmeriPride fails to establish that its inadvertent disclosure of

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the documents should not constitute a waiver.

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According to Federal Rule of Evidence 502(b), “When the

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disclosure is made in a federal proceeding . . . the disclosure

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does not operate as a waiver . . . if: (1) the disclosure is

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inadvertent; (2) the holder of the privilege or protection took

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reasonable steps to prevent disclosure; and (3) the holder promptly

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took

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applicable) following Federal Rule of Civil Procedure 26(b)(5)(B).”

reasonable

steps

to

rectify

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the

error,

including

(if

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FED. R. EVID. 502(b).

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the “claw back” of documents, has the burden of proving that they

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meet the requirements of Federal Rule of Evidence 502(b).

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Callan v. Christian Audigier, Inc., 263 F.R.D. 564, 565-66 (C.D.

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Cal. 2009).

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Plaintiff AmeriPride, as the party seeking

See

Here, it is not apparent to the court that AmeriPride took

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reasonable

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currently at issue. Although AmeriPride referred TEO to “privilege

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logs previously produced by AmeriPride in the course of this

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litigation” in its August 26, 2011 letter accompanying its document

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production, it is unclear why AmeriPride did not itself refer to

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its own 2000 privilege log before producing documents to TEO and

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either

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produced or incorporate the prior privileges by reference in

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AmeriPride’s August 26, 2011 privilege log.

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AmeriPride has failed to show or argue that it took reasonable

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steps to prevent the disclosure of the documents currently at

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issue, even if those documents were protected by the work product

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doctrine or attorney client privilege, AmeriPride would have waived

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those protections by its inadvertent disclosure.

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Accordingly, this court clarifies its November 15, 2011 order and

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determines that:

steps

remove

to

the

prevent

allegedly

the

disclosure

privileged

of

the

documents

documents

from

those

Because Plaintiff

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[1] AmeriPride’s “claw back” request under Federal Rule of

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Civil Procedure 26(b)(5)(B) as related to the “Memorandum

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from in-house counsel, B.P. Berry re: environmental audit of

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each plant, with attachments” and as described above, is
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DENIED.

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[2]

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the filing of those documents under seal, ECF No. 780, is

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DENIED as moot.

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IT IS SO ORDERED.

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DATED: December 15, 2011.

The parties’ stipulation and proposed order permitting

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