E3 Biofuels, LLC v. Biothane Corporation et al

Filing 114

ORDER - Plaintiff's Motion to Compel Return of Privileged Documents 98 is granted. Perennial shall return the unopened package containing the disc no later than December 16, 2011. Perennial's Motion to Declare that Plaintiff's Alleged Privileges are Waived or, in the alternative, to Compel Plaintiff to Produce Privilege Log 108 is denied. Ordered by Magistrate Judge F.A. Gossett. (JAE)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
E3 BIOFUELS, LLC,
Plaintiff,
V.
BIOTHANE, LLC, successor in
interest and liability to, and
PERENNIAL ENERGY, INC.,
Defendants.

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8:11CV44

ORDER

Presently pending before the Court are Plaintiff’s Motion to Compel Return of
Privileged Documents (filing 98) and Defendant Perennial Energy, Inc.’s (“Perennial”)
Motion to Declare that Plaintiff’s Alleged Privileges are Waived or, in the alternative, to
Compel Plaintiff to Produce Privilege Log (filing 108). For the reasons explained below,
Plaintiff’s motion will be granted and Perennial’s motion will be denied.
BACKGROUND
On or about September 26, 2011, in response to a discovery request, Plaintiff mailed
a computer disc to the defendants in this case. On September 27, 2011, before the defendants
received the disc, Plaintiff’s counsel discovered that, due to a technical error, hundreds of
documents purportedly protected by the attorney-client privilege and attorney work product
doctrine were mistakenly included on the disc. Plaintiff’s counsel immediately notified
Perennial’s counsel of the error and requested the return of the unopened envelope.
Perennial’s counsel refused. As a result, Plaintiff filed a motion to compel Perennial to
return the disc. Subsequently, Perennial filed a motion requesting that the Court declare that
the privileges Plaintiff asserted in connection with the disc were waived or, in the alternative,
to compel Plaintiff to produce a privilege log (filing 108).

ANALYSIS
Perennial objects to the return of the disc claiming that it has the right to sequester the
documents until such time as Plaintiff demonstrates that the documents contained on the disc
are, in fact, privileged. Perennial also suggests that Plaintiff waived any privileges through
its production of the disc and its failure to produce a privilege log. The Court rejects each
of these arguments.
Plaintiff’s counsel notified each of the defendants’ counsel immediately upon learning
of the mistake - even before the defendants actually received the disc. Defendant Biothane
promptly returned the disc. When Perennial’s counsel refused to return the disc, despite
Plaintiff’s counsel’s offer to pay shipping charges, Plaintiff filed a motion requesting that the
Court compel Perennial to return the disc. Moreover, in an effort not to delay discovery,
Plaintiff provided Perennial with a replacement disc which removed the purportedly
privileged documents.
The Court recognizes Plaintiff’s initial failure to produce a privilege log. However,
given the voluminous amount of documents involved, and that the attorney from Plaintiff’s
counsel’s firm who was working on the privilege log suddenly resigned, the Court finds that
Plaintiff’s delay was understandable. And, in any event, a privilege log has now been
provided to Perennial. If Perennial takes issue with any of the claimed privileged documents
outlined on the privilege log, it may file a proper motion to compel. There is no need for
Perennial to keep the disc. Should the Court determine, upon reviewing any motion to
compel filed by Perennial, that an in camera inspection of any listed document is necessary,
it will order Plaintiff to produce that particular document at that time.
IT IS ORDERED:
1.

Plaintiff’s Motion to Compel Return of Privileged Documents (filing 98) is
granted. Perennial shall return the unopened package containing the disc no
later than December 16, 2011.

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2.

Perennial’s Motion to Declare that Plaintiff’s Alleged Privileges are Waived
or, in the alternative, to Compel Plaintiff to Produce Privilege Log (filing 108)
is denied.

DATED: December 9, 2011.
BY THE COURT:
S/ F.A. Gossett
United States Magistrate Judge

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