Cooper et al v. Meritor, Inc. et al

Filing 121

ORDER denying (111) Motion to Compel in case 4:16-cv-00052-DMB-JMV; denying (101) Motion to Compel in case 4:16-cv-00053-DMB-JMV; denying (104) Motion to Compel in case 4:16-cv-00054-DMB-JMV; denying (106) Motion to Compel in case 4:16-cv-00055-D MB-JMV; denying (104) Motion to Compel in case 4:16-cv-00056-DMB-JMV. Signed by Magistrate Judge Jane M. Virden on 1/12/17. Associated Cases: 4:16-cv-00052-DMB-JMV, 4:16-cv-00053-DMB-JMV, 4:16-cv-00054-DMB-JMV, 4:16-cv-00055-DMB-JMV, 4:16-cv-00056-DMB-JMV (tab)

IN THE UNITED STATES DISTRICT
COURT FOR THE NORTHERN DISTRICT OF MISSISSIPPI
GREENVILLE DIVISION
BRENDA J. COOPER; SYLVIA R. CAFFEY;
MARGARET J. ODEMS; BERNICE B.
RICHARDSON; DORA A. WARD; ROSIE BRADY;
PEARL SELDON; BETTY PHILLIPS, PERSONAL
REPRESENTATIVE AND DEVISEE OF HILDRED
JOHNSON DECEASED; ALICE CRUMLEY,
DEVISEE OF HILDRED JOHNSON; AND SYLVIA
CUNNINGHAM
VS.

PLAINTIFFS

CIVIL ACTION NO. 4:16-cv-052 DMB-JMV

MERITOR, INC. F/D/B/A ROCKWELL
INTERNATIONAL CORPORATION; TEXTRON,
INC. F/D/B/A RANDALL DIVISION OF TEXTRON,
INC.

DEFENDANTS

CONSOLIDATED WITH
JOE E. SLEDGE; KATRENA FISHER,
PERSONAL REPRESENTATIVE AND
DEVISEE OF HENRY FISHER, DECEASED DAVID
L. MCCLAIN; MARY MCCLAIN; DOLPHUS
BRIDGES; BARBARA L. BRIDGES; CAROL S.
JOHNSON; CORDELIA REED; JAMES WRIGHT;
LUCILLE TURNER; EMMA J. HARDIMAN; JEFFREY
SCOTT; SINCELLIA SCOTT
VS.

PLAINTIFFS

CIVIL ACTION NO. 4:16-cv-053 DMB-JMV

MERITOR, INC. F/D/B/A ROCKWELL
INTERNATIONAL CORPORATION; TEXTRON,
INC. F/D/B/A RANDALL DIVISION OF TEXTRON,
INC.
AND
KATHERINE LONGSTREET COOKE;
SHIRLEY NEVITTE; STACY H. BRIDGES;
BERNARD WILLIAMS A/K/A HUBERT WILLIAMS;
LESSIE LUSK A/K/A LESSIE LUSK PORTER;
JAMES HARRIS; SHIRLEY HARRIS; DARRELL
HUBBARD; SANDRA HUBBARD; BESSIE BAGGETT
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DEFENDANTS

A/K/A BESSIE YATES; THYRA W. CRAIG
VS.

PLAINTIFFS
CIVIL ACTION NO. 4:16-cv-054 DMB-JMV

MERITOR, INC.; ROCKWELL AUTOMATION,
INC.; and TEXTRON, INC.

DEFENDANTS

AND
SRA INVESTMENTS, LLC c/o STEVE
COUCH; AMOS JOHNSON; ANNIE MAE
MCFARLAND AND MISTER; DOBIE ARCHER;
SAMMIE LOGGINS, JR.; ANGELIA REED
LOGGINS; CAMMIE L. HARGES; TARIK
JOHNSON; CURTIS BLISSETTE; LINDA
SINGLETON; WILLIAM EARL BENSON; BARBARA
BENSON
VS.

PLAINTIFFS

CIVIL ACTION NO. 4:16-cv-055-DMB-JMV

MERITOR, INC. F/D/B/A ROCKWELL
INTERNATIONAL CORPORATION; TEXTRON,
INC. F/D/B/A RANDALL DIVISION OF TEXTRON,
INC.

DEFENDANTS

AND
FELICIA WILLIS AS ADMINISTRATRIX OF THE
ESTATE OF DAISY K. WILLIS, DECEASED;
VIOLA P. SYKES; EMMA J. SCOTT a/k/a EMMA
MCKINNEY; JESSE LITTLE; ANNETTE MARIE
BARNES HIGHTOWER; TERRY L. MURRY; BOBBIE M.
MISTER; MARY M. INGRAM; EARL REED; and
RUBYE BOOKER
VS.

PLAINTIFFS

CIVIL ACTION NO. 4:16-cv-056-DMB-JMV

MERITOR, INC. F/D/B/A ROCKWELL
INTERNATIONAL CORPORATION; TEXTRON,
INC. F/D/B/A RANDALL DIVISION OF TEXTRON,
INC.

DEFENDANTS

ORDER DENYING MOTION TO COMPEL THE RETURN OF
PRIVILEGED DOCUMENTS

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This matter is before the court for decision on the Motion of Textron, Inc. (Textron) to
Compel the Return of Documents currently in the possession of Plaintiff’s counsel and claimed
by Textron to be privileged. ([111] in 4:16-cv-52; [101] in 4:16-cv-53; [104] in 4:16-cv-54;
[106] in 4:16-cv-55; and [104] in 4:16-cv-56). As discussed below, the court finds that Textron
has no privilege to assert with respect to the subject documents.
In the instant case, Textron asserts a privilege over fifteen (15) documents created from
1989 to 1996 during a period of time it owned and operated a wheel cover manufacturing facility
in Grenada, Mississippi. In 1999, Textron entered and subsequently consummated an asset sale
agreement with Grenada Manufacturing, LLC (hereinafter sometimes “the APA”). According to
Textron, it did not transfer ownership of documents related to environmental matters, including
the subject 15 documents, to Grenada Manufacturing, LLC as part of that sale. It is Textron’s
positon that it retains ownership of all such documents and any affiliated privilege with respect
thereto.
Textron argues that because the Textron/Grenada Manufacturing, LLC APA excludes
from the sale, assets not “used exclusively in, or held for use exclusively in, the Business,”
documents related to environmental matters were excluded. Textron also argues that the fact that
it or another entity retained all environmental liabilities and obligations, to the extent such claims
were based on the release of materials at the facility before the closing date, means ownership of
the documents related to environmental matters was not transferred to Grenada Manufacturing,
LLC as part of the APA. According to an affidavit supplied by Textron, boxes of these
environmental documents, together with other business records of Textron’s operations prior to
the 1999 sale, were left by Textron at the Grenada facility after the sale. Indeed, Textron
contracted for a right to access the documents for a period of time following the sale. APA 14.1.

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In the court’s view, Textron’s claim of retained ownership of the documents, even if it were
convincing,1 does not satisfactorily answer whether its treatment of those assets waived any
privilege that might be claimed with regard to any of them.
If Textron is correct that it did not sell documents related to environmental matters to
Grenada Manufacturing, LLC in 1999 (15 pages of which it now contends are privileged), then it
has conceded that it left those documents – for decades – in possession and control of another
(indeed, others) without restriction on the ability of the other entities to access, review, copy or
disseminate them. The documents were in the possession of Grenada Manufacturing, LLC from
1999 until 2004 when Grenada Manufacturing, LLC filed Chapter 11 bankruptcy. The
bankruptcy court authorized, without objection by Textron (who was a named creditor), a sale to
Ice Industries, Inc. of its assets, including its documents, but Textron argues that Grenada
Manufacturing, LLC could not have transferred the environmental records dating prior to the
Textron/Grenada Manufacturing, LLC sale in 1999, to Ice Industries, Inc. because Grenada
Manufacturing, LLC did not own those documents.
Even if this were so, Textron is faced with the fact that it intentionally left documents that
it must acknowledge (because it is material to its claim of retained ownership of the documents
in the first instance) it knew concerned environmental matters related to releases from the
business prior to 1999. These documents were intentionally left unattended and unrestricted in
the hands of yet another party – this time, Ice Industries, Inc. Though Textron was given notice
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As the Court construes the provisions of the asset purchase agreement, ownership of all documents
concerning the business (except those related to tax refunds and rebates) were transferred pursuant to section 1.1(v)
of the purchase and sale agreement (albeit with provision made for the seller to access historical environmental
documents after the close of the sale, as necessary, in order to address certain environmental liabilities retained by
it). The environmental documents are plainly documents generated in connection with the operation, and continued
operation, of the business and the mere fact that Textron retained liabilities and obligations related to certain
environmental matters (and an associated contractual right to access the documents in the possession of Grenada
Manufacturing, LLC post-sale to address those liabilities), does not mean the documents were not part of the assets
sold by way of the APA.

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of the asset transfer to Ice Industries, Inc., it made no effort to retrieve the environmental
documents or to even review them for privilege.
In other words, Textron plainly waived any privilege that would have otherwise been
retained if the documents had, in fact, been excluded from the purchase and asset sale. See
Alldread v. City of Grenada, 988 F.2d 1425, 1434 (5th Cir. 1993) (“Patently, a voluntary
disclosure of information which is inconsistent with the confidential nature of the attorney-client
relationship waives the privilege.”); Solis v. Bruister, 2013 WL 493374, at *2 (S.D. Miss. Jan.
22, 2013) (The voluntary disclosure of privileged or work product information to third parties
constitutes a waiver and destroys any privilege claims.); see also Chemeon Surface Tech., LLC v.
Metalast Int'l, Inc., 2016 WL 4967716, at *2–3 (D. Nev. Sept. 15, 2016).
At the hearing on this matter, Textron’s counsel argued that while it may have known that
documents related to environmental matters it claimed to own were left in the possession of
Granada Manufacturing, LLC, it had forgotten by that time (1999), or otherwise failed to realize
then, that those documents included documents that it might claim a privilege with respect to.
And, when the assets of Grenada Manufacturing, LLC were sold to Ice Industries, Inc. in 2005, it
did not retrieve the documents from Grenada Manufacturing, LLC, so as to avoid transfer of
their physical possession and disclosure to Ice Industries, Inc. because it, again, did not
recall/realize that there were privileged documents among them. In other words, Textron argues
that unless it realized that the documents concerning environmental matters that it freely gave
possession of to others for decades did in fact contain privileged documents, that disclosure
could not waive any privilege attendant to the document(s).
The court is unpersuaded. See Solis, 2013 WL 493374, at *2 (Defendants have not
convinced the Court that any privileges were not waived when Amy Smith's computer was

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turned over to DirecTV.); Robbins & Myers, Inc. v. J.M. Huber Corp., 2003 WL 21384304, at *3
(W.D.N.Y. May 9, 2003) (Defendants have waived any attorney-client privilege or work-product
protection that otherwise might have attached to any documents that were left in the possession
of FCE after November 20, 1997.); In re Grand Jury Subpoenas 89-3 & 89-4, 734 F. Supp.
1207, 1213 (E.D. Va.), order aff'd in part, vacated in part sub nom. In re Grand Jury Subpoenas,
89-3 & 89-4, John Doe 89-129, 902 F.2d 244 (4th Cir. 1990) (Movant, it appears, permitted at
least some of these documents to remain in the Subsidiary's custody and control after the sale of
the Subsidiary. In so doing, it effectively waived its privilege with respect to these documents.).
Further, there is nothing about the “practical consequences doctrine” that dictates a
different outcome. The practical outcome of leaving – for decades – documents a company
contends it owns in possession of another, with no provision for protection of any privileged
communications therein, not to mention permitting the subsequent transfer of possession to
others on additional occasions, all without any effort to retrieve them prior to the instant
litigation,2 or to otherwise review them to remove privileged materials has the obvious practical
and legal consequence of waiver of any associated privileges.
Finally, because the court finds that any privilege has been waived or transferred to
another prior to the instant litigation, it is not necessary at this juncture to address the adequacy
of the Textron privilege log with particularity. However, the court notes, for future reference,
that a privilege log that fails to identify all authors and all recipients adequately (including not
just a name but the person’s relationship to counsel or the client) is insufficient. As counsel is no

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The court declines to find a waiver based on a party’s disclosure in the course of the instant litigation.
See lead case [83] CMO at section 6(f) “Pursuant to Rule 502(d) of the Federal Rules of Evidence, the attorneyclient privilege and the work-product protections are not waived by any disclosure connected within this litigation
pending before this Court. Further, the disclosures are not waived in any other federal or state proceeding.”; see also
F.R.E. 502(d).

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doubt aware, simply because a lawyer is copied on a document, or even authored it, does not
necessarily, under all circumstances, make it privileged.
SO ORDERED this, the 12th day of January, 2017.
/s/ Jane M. Virden
UNITED STATES MAGISTRATE JUDGE

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