CARPENTER CO. et al v. BASF SE et al

Filing 81

OPINION. Signed by Judge William J. Martini on 6/16/15. (gh, )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY

Civ. No. 2:08-5169 (WJM-MF)

CARPENTER CO., et al.,
Plaintiffs,

OPINION
v.
BASF SE, et al.
Defendants.

WILLIAM J. MARTINI, U.S.D.J.:
This matter comes before the Court on Defendant Dow Chemical Company’s motion
in limine to admit documents filed in a separate action currently pending in the United
States District Court for the Northern District of Ohio. Because prior discovery orders in
this case have already held those documents to be undiscoverable, Dow’s motion in limine
is DENIED. Moreover, the Court will strike those documents from Dow Chemical
Company’s exhibit list.
I.

BACKGROUND

Plaintiffs in this action are purchasers of Polyether Polyol Products (“PPPs”), while
Defendant Dow Chemical Company (“Dow”) is a major manufacturer and seller of PPPs.
Plaintiffs accuse Dow of conspiring to manipulate prices for PPPs with other PPP
manufacturers in violation of antitrust laws. Plaintiffs allege that as a result of the
conspiracy, they paid inflated prices for PPPs.
In 2004, Dow (along with other defendants) was named as a defendant in a series of
class action lawsuits alleging price fixing. Those cases were consolidated in the United
States District Court for the District of Kansas (hereinafter, “the MDL Court”) for pre-trial
proceedings. In 2008, the MDL Court certified a class of entities that purchased PPPs
directly from Defendants between 1999 and 2004. A number of entities that fell within the
class description opted out of the class and initiated the instant litigation in the District of
New Jersey. The MDL Panel transferred those cases to the MDL Court for the handling
of various pretrial proceedings, including discovery disputes. In July 2014, the MDL Court
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issued an order suggesting that this case be remanded to this Court. The order suggesting
remand also indicated that discovery in this matter was “complete.” The matter is now
before this Court for final pre-trial proceedings and trial.
The MDL Court presided over the bulk of pre-trial proceedings in this matter, including
discovery issues. Of relevance to this motion in limine, the MDL Court presided over
discovery issues concerning Plaintiffs’ role as a seller of foam products in the downstream
foam market. Specifically, it has been Dow’s position that in the downstream foam market,
Plaintiffs have engaged in the same type of conduct that they accuse Dow of in the instant
action. Consistent with their position, Dow has sought discovery related to Plaintiffs’
participation in the downstream foam market.
One sub-category of those documents consists of court filings in a case captioned In re
Polyurethane Foam Antitrust Litigation, No. 10-md-2196 (N.D.Ohio) (hereinafter, “the
Foam Litigation”). Certain Plaintiffs in this action (hereinafter, “the Overlapping Parties”)
are defendants in the Foam Litigation, which was filed in 2010. According to Dow, the
Overlapping Parties have taken “diametrically opposed positions” by portraying certain
conduct as evidence of price-fixing in this litigation, while simultaneously defending that
same conduct in the Foam Litigation.
While Dow has been successful in obtaining some documents that pertain to Plaintiffs’
conduct in the downstream market, it has encountered some difficulty in its pursuit of
documents from the Foam Litigation (hereinafter, “the Foam Documents”). Before
describing those difficulties, it is first important to note that Dow represented to the MDL
Court in May 2013 that it did not intend to request new discovery from the Foam Litigation.
See Dow Notice Regarding Discovery Materials from the Polyurethane Litigation, June 10,
2013, 04-md-1616 (D. Kansas), May 17, 2013, ECF No. 2882. Additionally, a prior order
from the MDL Court had already noted that fact discovery would conclude in February
2012.
In September 2013, however, Plaintiff Carpenter Co. and E.R. Carpenter (collectively,
“Carpenter”) moved to reopen discovery so that some of their former employees who had
previously invoked their Fifth Amendment privilege could withdraw their invocations and
testify. The MDL Court permitted discovery to reopen, and allowed Dow to seek “limited
follow-up discovery after the depositions.”
Following the depositions, Dow sought additional documents filed under seal in the
Foam Litigation as follow-up discovery. An order dated November 5, 2013 from the MDL
Court (hereinafter, “the November 2013 Order”) denied Dow’s request, and noted that
“Dow fails…to address why its new discovery request is timely, in other words, what
information arose in the recent depositions that would justify Dow’s request for the
information now.” Order dated Nov. 5, 2013, 04-md-1616 (D. Kansas), ECF No. 3073, at
3. It further held:
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In its instant request to reopen discovery into the Foam
Litigation, Dow does not identify any specific new
information arising from the depositions of the [Carpenter]
witnesses that would justify a wholesale change of course….
Dow does not identify a single line of recent testimony that
would suggest the necessity of follow-up discovery consisting
of the entire discovery record in the Foam Litigation”
Id. at 4. Following the November 2013 Order, Dow again sought the Foam Documents,
this time arguing that they were encompassed in prior discovery requests. The MDL Court
denied that request as well, explaining that “the time to make new discovery requests
related to the Foam Litigation had long passed, and that Dow had previously represented
to the Court that it would not seek new discovery from that litigation.” Order dated Jan.
24, 2014, 04-md-1616 (D. Kansas), ECF No. 3129. Six months later, the MDL Court
suggested remand to this Court, noting that discovery in this case was complete. Pretrial
Order of the Transferee Court Regarding Cases Ready for Remand dated July 1, 2014, 04md-1616 (D. Kansas), ECF No. 3202.
Having twice failed in its attempts before the MDL Court, Dow then filed a motion to
intervene in the Northern District of Ohio (hereinafter, “the Foam Court”) for the limited
purpose of obtaining the Foam Documents, which, as stated previously, were filed under
seal. The Foam Court granted Dow’s motion to intervene in part, and provided Dow with
electronic access to the Foam Documents, subject to the following caveat: the Foam
Court’s order only gives Dow “access to the [Foam documents], and permits use of those
documents in In re Urethane Antitrust Litig., Case No. 2:08-cv-5169-WJM-MF (D.N.J) if
that court so allows.” Order dated February 24, 2015, 10-md-2196 (N.D.Ohio), ECF No.
1527. Moreover, the Foam Court explicitly noted that it was not ruling on the
discoverability or admissibility of the Foam Documents in this action; instead it was
leaving those issues for this Court to decide. Id.
After this case was remanded here, the parties exchanged exhibit lists. Upon realizing
that Dow had placed the Foam Documents on its list, Plaintiffs sought to strike those
documents by way of a letter motion filed with United States Magistrate Judge Mark Falk.
In response, Dow filed the instant motion in limine.
II.

DISCUSSION

The threshold issue is whether the November 2013 Order, along with another discovery
order issued on January 24, 2014, precludes Dow from admitting the Foam Documents. Dow
accessed the Foam Documents through permissive intervention pursuant to Federal Rule of
Civil Procedure 24(b). The Third Circuit has held that permissive intervention may be used
by a collateral litigant who, while not an original party to an action, seeks judicial records
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filed under seal in that action. Jackson v. Delaware River and Bay Auth., 224 F.Supp.2d 834,
837-38 (D.N.J. 2002) (citing Pansy v. Borough of Stroudsburg, 23 F.3d 772, 777 (3d Cir.
1994)). It is widely accepted, however, that permissive intervention may not be used “merely
to subvert limitations on discovery in [the collateral] proceeding…[and] a collateral litigant
has no right to obtain discovery materials that are privileged or otherwise immune from
eventual involuntary discovery in the collateral litigation.” United Nuclear Corp. v. Cranford
Ins. Co., 905 F.2d 1424 (1990) (quoting Superior Oil Co. v. American Petrofina Co., 785
F.2d 130, 130 (5th Cir. 1986)). See also AT&T Corp. v. Sprint Corp., 407 F.3d 560, 562 (2d
Cir. 2005) (permissive intervention not appropriate when used to circumvent the close of
discovery in a separate action).
That is exactly what Dow seeks to do here. The MDL Court issued two discovery orders
explicitly denying Dow’s request for the Foam Documents. Then, once the case was
remanded to this Court, Dow sought to circumvent those discovery orders by intervening in
the Foam Litigation. Under the principles described above, the Foam Documents remain
undiscoverable pursuant to the prior discovery orders issued in this case. Moreover, this
Court sees no reason to disturb the MDL Court’s prior discovery orders. Cf. Hayman Cash
Register Co. v. Sarokin, 669 F.2d 162, 168 (3d Cir. 1982) (“[P]rinciples of comity among
courts of the same level of the federal system provide a further reason why the transferee
court should not independently re-examine an issue already decided by a court of equal
authority.”) (citations omitted). Specifically, the MDL Court properly concluded that (1)
Dow was aware of the Foam Litigation well before this action’s discovery deadline passed;
(2) Dow had previously represented that it was not seeking additional discovery from the
Foam Litigation; and (3) Dow could not point to any specific portions of the Carpenter
testimony that would justify its untimely request for the Foam Documents. The Court
concludes that there has been no change in circumstances that warrant a departure from the
MDL’s prior discovery orders.
Dow argues that because it has already obtained access to the Foam Documents, the
November 2013 Order is not implicated. In doing so, Dow assumes that because it possesses
the Foam Documents, issues relating to their discoverability – including the effect of past
discovery orders – are no longer relevant. The Court rejects Dow’s position. Courts granting
permissive intervention motions that allow a collateral litigant access to judicial records have
firmly held that it is for the collateral court to decide whether those records are discoverable
in the collateral action. See, e.g., United States Nuclear Corp. v. Cranford Ins. Co., 905 F.2d
1424, 1429 (10th Cir. 1990) (citing Superior Oil Co. v. American Petrofina Co. of Texas, 785
F.2d 130 (5th Cir. 1986)). Indeed, the Foam Court explicitly stated the discoverability of the
Foam Documents was for this Court to decide, while noting that it was granting Dow’s motion
to intervene as a means of avoiding repetitive discovery should this Court deem those
documents discoverable. 1
1

In support of its position, Dow relies on decisions that are readily distinguishable from the case at bar.
In Whittaker Corp. v. Execuair Corp., 736 F.2d 1341 (9th Cir. 1984), the Ninth Circuit held that the trial
4

As explained above, the Foam Documents are not discoverable in this action. Because
the Foam Documents are not discoverable, the Court need not engage in a typical motion in
limine analysis, i.e., the Court need not decide whether the Documents are admissible under
the Federal Rules of Evidence. Additionally, the Court will strike the Foam Documents from
Dow’s exhibit list. However, this opinion and accompanying order have absolutely no
bearing on any materials other than the Foam Documents. 2 The Court currently takes no
position on the admissibility of any other documents that concern Plaintiffs’ activities in the
downstream market.
III.

CONCLUSION

For the foregoing reasons, Dow’s motion in limine is DENIED. Additionally, the Court
will order that the Foam Documents be stricken from Dow’s Exhibit List. An appropriate
order accompanies this decision.

/s/ William J. Martini
WILLIAM J. MARTINI, U.S.D.J.
Date: June 16, 2015

court erred by prohibiting the plaintiff from admitting documents it obtained in a separate antitrust case
after the discovery cutoff date. The Ninth Circuit, however, partially rested its holding on the fact that
the antirust documents were not subject to a protective order and were therefore publicly available.
Moreover, there is no indication that the trial court in that case had already issued (multiple) discovery
orders specifically holding that the documents from the antitrust action were undiscoverable. The court
in American Bank v. City of Menasha, 627 F.3d 261 (7th Cir. 2010) similarly noted that it was dealing
with documents that were publicly available and not obtained through discovery under the Federal Rules
of Civil Procedure. Moreover, the court in Menasha strongly implied that its holding would be different
if it involved the scenario that is currently before this Court — namely, where a party uses civil discovery
in one action for the purpose of obtaining non-public documents that have already been deemed
undiscoverable in a separate action.
2

To be clear, this opinion and accompanying order applies only to the documents Dow obtained from
the Foam Court through permissive intervention.
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