Solis v. New China Buffet No 8, Inc et al
Filing
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ORDER granting in part and denying in part 29 Motion to Compel. Ordered by Judge C. Ashley Royal on 7/1/11 (lap)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
MACON DIVISION
HILDA L. SOLIS,
Secretary of Labor, United States
Department of Labor,
Plaintiff,
v.
NEW CHINA BUFFET #8, INC. &
YUN DA CHEN, an individual,
Defendants.
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No. 5:10-CV-78 (CAR)
ORDER ON DEFENDANTS’ MOTION TO COMPEL
This matter comes before the Court on Defendants’ Motion to Compel [Doc. 29].
Defendants request that the Court compel Plaintiff to provide complete answers to specific discovery
requests. Through various discovery devices, Defendants sought information relating to Plaintiff’s
investigation of this Fair Labor Standards Act (“FLSA”) case, particularly the identities of any
employees that gave statements to the Department of Labor, the contents of those statements, and
the contents of the investigative file. Plaintiff refused to provide that information based on the
informer’s privilege. Having considered the matter, Defendants’ Motion to Compel [Doc. 29] is
GRANTED-IN-PART and DENIED-IN-PART.
I. BACKGROUND
Plaintiff filed a Complaint alleging that Defendants violated various provisions of the Fair
Labor Standards Act of 1938, 29 U.S.C. § 201 et seq. During the discovery process, the parties
reached an impasse over the disclosure of certain information related to Plaintiff’s investigation.
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The particulars of that dispute are as follows. In her initial disclosure, Plaintiff listed the
names of forty-eight of Defendants’ former employees as potential witnesses, but provided no
further identifying information. Defendants sought the contact information of those forty-eight
potential witnesses listed in Plaintiff’s Initial Disclosures. Defendants propounded an interrogatory
seeking the identity of any of those individuals who were interviewed by or provided a statement
to the Department of Labor (“Interrogatory 3”). Defendants propounded a request for production
seeking any affidavits or written or recorded statements of any person regarding any claims or
defenses in this lawsuit (“Request for Production 1”). Defendants also propounded a request for
production seeking Investigator Ramon Delgado’s entire investigation file from the investigation
of New China Buffet #8, Inc., and Yun Da Chen (“Request for Production 3”).
Plaintiff refused those requests, claiming that the information sought was protected by the
government’s informer’s privilege. Specifically, Plaintiff refused to turn over any addresses or
telephone numbers for any of those forty-eight potential witnesses and refused to identify the
individuals that were interviewed or that provided statements. Plaintiff turned over the investigative
file, but with the names and contact information of witnesses and other information that Plaintiff
deemed as tending to identify the witness redacted.
A mutually agreeable compromise not forthcoming, Defendants filed this motion to compel,
seeking the requested information.
II. DISCUSSION
Defendants mount two arguments against Plaintiff’s refusal to disclose the requested
information and documents. First, they argue that Plaintiff has not properly invoked the informer’s
privilege. Second, they argue that the informer’s privilege should not protect the information they
are seeking. The Court will address each argument in turn.
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A.
Invocation of the Privilege
Defendants first contend that Plaintiff did not properly invoke the privilege in response to
the interrogatory and requests for production. In order for the Government to properly invoke the
privilege “[t]here must be formal claim of privilege, lodged by the head of the department which has
control over the matter, after actual personal consideration by that officer.” United States v.
Reynolds, 345 U.S. 1, 7-8, 73 S. Ct. 528, 532 (1953) (footnote omitted). The formal invocation of
the privilege, however, need not come until the Government is faced with a motion to compel. See
In re Sealed Case, 121 F.3d 729, 741 (D.C. Cir. 1997); Tri-State Hosp. Supply Corp. v. United
States, 226 F.R.D. 118, 134 n.13 (D.D.C. 2005) (“[T]he government had no obligation to formally
invoke the privilege in advance of the motion to compel.”); Huntleigh USA Corp. v. United States,
71 Fed. Cl. 726, 727 (2006) (“[T]he procedural requirements for asserting the privilege are satisfied
through the production of a declaration or affidavit by the agency head, and produced in response
to a motion to compel.”) (internal quotation marks omitted)).1
Plaintiff properly invoked the informer’s privilege in this case. In response to Defendants’
Motion to Compel, Plaintiff produced a declaration from Acting Wage and Hour Administrator
Nancy J. Leppink.2 In her declaration, Administrator Leppink stated that she had personally
reviewed the relevant parts of the investigation file, including information withheld or redacted.
1
Although these cases concern other privileges, such as the deliberative process
privilege, the “requisites for formal invocation of the privilege have been uniformly applied
irrespective of the particular kind of executive claim advanced.” United States v. O’Neill, 619
F.2d 222, 226 (3d Cir. 1980) (internal quotation marks omitted).
2
Generally, an agency head may delegate the responsibility for invoking a
government privilege to a high-ranking subordinate. Chao v. Westside Drywall, Inc., 254 F.R.D.
651, 657 (D. Or. 2009). According to Administrator Leppink’s declaration, the Secretary of
Labor has specifically delegated the authority to invoke any necessary governmental claim of
privilege to the Administrator or Acting Administrator. [Doc. 34-1 ¶ 6].
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[Doc. 34-1 ¶ 8]. She went on to the state that the Secretary of Labor objected to the production of
the requested documents and identifying information because it was protected from disclosure
pursuant to the informant’s privilege. [Id. ¶ 11]. She then “invoke[d] the informant’s privilege to
protect from disclosure the identities, and any statements and other documents, or portions thereof,
which could reveal the identifies, of persons who have provided information to the U.S. Department
of Labor in the instant case.” [Id. ¶ 12].
B.
Application of the Privilege
What courts have termed the “informer’s privilege is in reality the Government’s privilege
to withhold from disclosure the identity of persons who furnish information of violations of law to
officers charged with enforcement of that law.” Rovario v. United States, 353 U.S. 53, 59, 77 S. Ct.
623, 627 (1957). The privilege protects “employees with legitimate complaints, exercising their
constitutional and statutory right to present their grievances to the government.” Brennan v.
Engineered Prods. Inc., 506 F.2d 299, 302 (8th Cir. 1974). “The purpose of the privilege is the
furtherance and protection of the public interest in effective law enforcement.” Rovario, 353 U.S.
at 59, 77 S. Ct. at 627. The government may invoke the privilege “to conceal the names of
employees who precipitated the suit by filing complaints with the Department of Labor.” Does I
thru XXIII v. Advanced Textile Corp., 214 F.3d 1058, 1072 (9th Cir. 2000). The privilege “applies
whether the [Department of Labor] solicited statements from an employee or the employee made
a complaint to the [Department of Labor].” Martin v. New York City Transit Auth., 148 F.R.D. 56,
63 (E.D.N.Y. 1993) (citing Dole v. Local 1942, International Bhd. of Elec. Workers, AFL-CIO, 870
F.2d 368, 370-71 (7th Cir. 1989)). The privilege applies to both current and former employees of
a company whose workers have communicated with the Department of Labor. Hodgson v. Charles
Martin Inspectors of Petroleum, Inc., 459 F.2d 303, 305-06 (5th Cir. 1972).
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The informer’s privilege is not absolute. Its scope is “limited by the underlying purpose of
the privilege as balanced against the fundamental requirements of fairness and disclosure in the
litigation process.” Charles Martin, 459 F.2d at 305. If the “disclosure of the contents of a
communication will not tend to reveal the identity of an informer, the contents are not privileged.”
Rovario, 353 U.S. at 60, 77 S. Ct. at 627. Generally, in questions involving the privilege, “the
interests to be balanced . . . are the public’s interest in efficient enforcement of the Act, the
informer’s right to be protected against possible retaliation, and the defendant’s need to prepare for
trial.” Charles Martin, 459 F.2d at 305. The defendant’s need for certain information is generally
less weighty during the discovery phase, as opposed to the pre-trial stage of the proceedings. See
id. at 307, Brennan, 506 F.2d at 303.
In Interrogatory 3, Defendants sought the identity of any individuals listed in Appendix A,
the list of former employees who were likely to have discoverable information provided in
Plaintiff’s Initial Disclosures, who were interviewed or who provided a statement during the
investigation of this matter by the Wages and Hour Division of the United States Department of
Labor.
Defendants contend that identification of the witnesses who provided statements to the
Department of Labor is vital to their defense because the case is based in whole or in part on
individualized accusations of FLSA violations. According to Defendants, they are unable to prepare
an adequate defense of this case without knowledge of the identity of the accusers. Defendants
further argue that Plaintiff’s need for withholding the identity of former employees who have been
interviewed by or given statements to the Department of Labor is weak in this case. Defendants
contend that the possibility of retaliation is remote in this case because none of the witnesses have
been employed by Defendants for over twenty-one months and because Defendants no longer own
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or operate New China Buffet #8 or any other restaurant.3 Finally, Defendants argue that Plaintiff
waived the informer’s privilege by disclosing the names of the forty-eight former employees in the
Initial Disclosures.
The aim of Interrogatory 3 is clear: “Defendants are seeking the identities of the individuals
who actually provided statements to Plaintiff’s agent during the investigation.” [Doc. 30 at 6]. Of
course, the identity of those who provided statements to the Department of Labor during an
investigation is the quintessential information protected by the informer’s privilege. None of
Defendants’ arguments are sufficient to overcome the privilege as to that information.
Defendants argument that they cannot adequately defend this case without knowing the
identity of the employees that gave statements during the investigation boils down to concerns of
time and money. As Defendants concede, they could “admittedly . . . depose all 48 of the named
witnesses once their contact information is provided by Plaintiff, [but] such an undertaking would
be extremely costly and inefficient.” [Doc. 30 at 7]. The Defendants’ need to depose all forty-eight
former employees listed in Appendix A, or even only those who provided statements, in order to
adequately prepare a defense appears far from pressing. The relevance of the identity of informers
in a FLSA case is often questionable. See Chao v. Westside Drywall, Inc., 254 F.R.D. 651, 660 (D.
Or. 2009) (noting that “the names of informers are [often] irrelevant to whether the employer
properly paid its employees and otherwise complied with the Act’s requirements”). Defendants
have failed to make any showing that this case is outside the normal situation wherein a defendant
has access to information and its own witnesses regarding its wage and record keeping practices,
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New China Buffet #8, Inc., was dissolved in 2009. Defendant Chen does not
currently own or operate New China Buffet #8 or any other restaurant.
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and the identity of informers is largely irrelevant.4 In any event, courts have generally found that
the cost and inconvenience that Defendants seek to avoid does not tip the balance in favor of
disclosure. See Charles Martin, 459 F.2d at 307 (“[T]hat depositions would be expensive show that
the statements would facilitate defendant’s investigation but such facilitation is not a requirement
for fundamental fairness to the defendant.”); Brennan, 506 F.2d at 303 & n.3 (noting that at the
discovery stage defendant was entitled to know “the charges, dates, names of underpaid employees,
and names of those persons known to the plaintiff who had information concerning the issues” and
that defendant had the ability to depose nineteen workers listed as possessing such information).
Defendants’ argument that the possibility of retaliation is low in this case because
Defendants no longer employ any of the possible witnesses or operate a restaurant strikes a common
theme in FLSA cases. It is also, however, an unsuccessful theme. As the Fifth Circuit observed in
Charles Martin, “The possibility of retaliation . . . is far from being ‘remote and speculative’ with
respect to former employees . . . .” 459 F.2d at 306. Employees may require references from a
former employer. Id. Employees may face retaliation at a new job if they are branded as informers.
Id. Former employees may even find it necessary to see reemployment with the defendant. Id. All
of these possibilities expose former employees of a FLSA defendant to the real risk of retaliation
if they are identified as informers. The facts of this case make the risk all the more concrete.
Although Defendant Chen and Defendant New China Buffet #8, Inc., no longer own or operate the
New China Buffet, the restaurant continues in existence with the same name and under new
ownership. Former employees of Defendant Chen and Defendant New China Buffet #8, Inc., might
4
If Defendants seek the identity and statements of the informers for impeachment
purposes, then the pretrial stage is the more appropriate time to address that concern. See
Charles Martin, 459 F.2d at 307.
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seek to continue employment at the restaurant, or may wish to return to the restaurant at some point.
Although Defendant Chen no longer owns and operates the restaurant, evidence produced by
Plaintiff shows a continuity of operation that raises a real risk of retaliation against former
employees wishing to stay on or seeking to return. Defendant Chen still owns the land and building
and leases them to the new owner. Defendant Chen’s wife has also served as the financial advisor,
Chief Financial Officer, and Secretary of the new owner. [See Deposition of D&D Restaurant Inc.].
That evidence only strengthens the normal conclusion that the risk of retaliation against former
employees is not “remote and speculative.”
Defendants’ argument that Plaintiff waived the informer’s privilege by disclosing the list of
employees that may have knowledge regarding the case and on behalf of whom she was making
claims is also a common and unsuccessful argument. Disclosure of the identity of an informer
vitiates the privilege. Roviaro, 353 U.S. at 60, 77 S. Ct. at 627 (“[O]nce the identity of the informer
has been disclosed to those who would have cause to resent the communication, the privilege is no
longer applicable.”). Providing a list of employees that may have knowledge pertinent to the case,
however, is not the same as identifying employees that have provided information to the Department
of Labor.
See Local 1942, 870 F.2d at 375 (“But merely labeling these individuals as
‘knowledgeable,’ while expressly invoking the informer’s privilege, is obviously not tantamount to
waiver. That these individuals are knowledgeable does not mean . . . that those people actually
supplied information to the Secretary.”). The assumption that most or all of the employees properly
classified as informers are on that list is likely a sound one, but the list itself does nothing to disclose
who amongst those employees are the informers. In other words, all the informers may be listed in
Appendix A, but not everyone listed in Appendix A is an informer. And for purposes of the
privilege, listing a former employee in Appendix A does not go nearly far enough in identifying
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them as an informer to waive the privilege.
In response to Requests for Production 1 and 3, Plaintiff produced witness statements with
the name, address, age, employment period, job title, and rate of pay redacted. Plaintiff contends
that the redaction was necessary because the information would tend to reveal the identity of the
informer. Courts have accorded varying levels of protection to the contents of an informer’s
statement, but the rule laid down by the Supreme Court in Roviaro is that “where the disclosure of
the contents of a communication will not tend to reveal the identity of an informer, the contents are
not privileged.” 353 U.S. at 60; 77 S. Ct. at 627.
In this case, the information redacted by Plaintiff would tend to reveal the identity of the
informer. The tendency of the statement giver’s name and address to reveal his identity is self
evident. Whether any other single piece of information relating to the statement giver’s age,
employment period, job title, or rate of pay would reveal his identity is less clear. Perhaps job title
or rate of pay alone would not. But the aggregation of any two of those pieces of information, much
less all four, would likely narrow down if not outright reveal the identity of the informer; thus, the
redaction of that information is protected by the privilege as well.
The final, and more difficult, question concerns the contact information for the persons listed
in Appendix A. Rule 26 of the Federal Rules of Civil Procedure mandates that a party must provide
as part of its initial disclosures the name and, if known, the address of individuals likely to have
discoverable information. Fed. R. Civ. P. 26(a)(1)(A)(i). Plaintiff’s primary concern in withholding
the addresses of the persons listed in Appendix A appears to be that disclosing that information will
necessarily identify those individuals who gave witness statements to the Department of Labor. In
light of those concerns, the Court required Plaintiff to disclose an unredacted copy of Appendix A
along with a list responsive to Interrogatory 3 for in camera inspection.
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Having consulted those materials, the Court concludes that compliance with Rule
26(a)(1)(A)(i) would not tend to identify individuals who gave statements to the Department of
Labor. If the Department of Labor only had contact information for the former employees it had
interviewed, then turning over the list of employees in Appendix A with known addresses would
tend to identify employees who had spoken with the Department. That, however, is not the case
here.
There is no particular correlation between the list of employees interviewed and the
individuals listed in Appendix A for whom the Department of Labor has contact information. There
is another, less direct, way in which turning over the contact information for the employees listed
in Appendix A might tend to disclose who the Department of Labor interviewed. Any discrepancies
in contact information between the contact information Defendants might already have and the
contact information in the hands of the Department of Labor might be used to attempt to infer who
the Department interviewed. But absent a showing that any discrepancies in contact information
between the parties is highly correlated to the list of employees interviewed by the Department, there
is no reason to believe that disclosure of the contact information for all the employees listed in
Appendix A would tend to identify anyone interviewed by the Department. There is no such
showing in this case; thus, any risk that any possible differences in information might tend to
disclose the identity of informers is far too speculative to trigger the protection of the informer’s
privilege. Under these circumstances, Plaintiff must complete her Rule 26(a) disclosure.
The information requested in Interrogatory 3 and the redactions in response to Requests for
Production 1 and 3 are protected by the informer’s privilege. To the extent that Defendants’ Motion
to Compel [Doc. 29] seeks that information, the motion is DENIED. The informer’s privilege does
not justify Plaintiff’s refusal to complete the Rule 26(a) disclosure. To the extent Defendants’
Motion seeks the contact information of former employees listed in Appendix A, the Motion is
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GRANTED.
SO ORDERED this 1st day of July, 2011.
S/ C. Ashley Royal
C. ASHLEY ROYAL, JUDGE
UNITED STATES DISTRICT COURT
bcw
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