Chevron Corporation v. Donziger et al

Filing 1333

MEMORANDUM AND ORDER granting in part and denying in part 1194 Motion to Compel; granting in part and denying in part 1195 Motion to Compel. For the foregoing reasons, Chevron's motion to compel as against Mr. Donziger (Docket no. 1194) and its motion to compel as against Mr. Naranjo and Mr. Payaguaje (Docket no. 1195) are each granted in part and denied in part as discussed above. These defendants shall produce amended privilege logs within two weeks of the date of this order. In addition, within that same time Mr. Donziger shall produce all documents identified as having been improperly withheld. (Signed by Magistrate Judge James C. Francis on 8/9/2013) Copies Mailed By Chambers. (lmb)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
- - - - - - - - - - - - - - - - - -:
CHEVRON CORPORATION,
:
:
Plaintiff,
:
:
- against :
:
:
STEVEN DONZIGER, et al.,
:
:
Defendants.
:
- - - - - - - - - - - - - - - - - -:
JAMES C. FRANCIS IV
UNITED STATES MAGISTRATE JUDGE

11 Civ. 0691 (LAK) (JCF)

MEMORANDUM
AND ORDER

With apologies, plaintiff Chevron Corporation (“Chevron”) has
added two more discovery motions to the already crammed docket in
this case.1

These motions seek production of documents that

defendants Steven R. Donziger, Hugo Gerardo Camacho Naranjo, and
Javier Piaguaje Payaguaje claim are privileged.

For the reasons

that follow, the motions are granted in part and denied in part.

1

The plaintiff asserts that it has “taken to heart the
Court’s admonitions regarding the filing of discovery motions,” but
that it was “compelled” to bring these motions because the
defendants said that they were going to file similar motions, and
“if the Court is going to be put to the task of determining whether
any party’s production or [privilege] log is inadequate, it should
be [the] [d]efendants’.”
(Plaintiff Chevron Corporation’s Motion
to Compel Defendant Steven Donziger to Produce Documents Withheld
(“Pl. Memo re Donziger”) at 1 n.1; Plaintiff Chevron Corporation’s
Motion to Compel Defendants Hugo Gerardo Camacho Naranjo and Javier
Piaguaje Payaguaje to Produce Documents Withheld (“Pl. Memo. re
Naranjo”) at 1 n.1).
This comment is curious.
Either these
motions have merit or they do not; the defendants’ intention to
file their own motions is irrelevant.
1

Background
This case arises out of a multi-billion dollar judgment
obtained

in

Ecuador

against

environmental destruction.

Chevron

based

on

claims

of

In this action, Chevron contends that

the plaintiffs in the Ecuadorian litigation (the “LAPs”), along
with their consultants and their attorneys, including Mr. Donziger,
procured the judgment through fraud.2
In the course of the litigation, in response to a motion to
quash a subpoena duces tecum issued to non-party Patton Boggs, LLP
(“Patton

Boggs”),

the

Honorable

Lewis

A.

Kaplan,

U.S.D.J.,

identified a number of areas for which attorney-client privilege
and work product protection was inapplicable on the basis of the
crime-fraud exception, which abrogates privilege “where there is
probable cause to believe that a fraud or crime has been committed
[by someone] and that the communications in question were in
furtherance of the fraud or crime.”

2

Chevron Corp. v. Donziger, 11

The factual and legal background of this controversy is set
out in the numerous opinions issued in this litigation and related
cases.
See, e.g., Chevron Corp. v. Naranjo, 667 F.3d 232 (2d
Cir.), cert. denied, 133 S. Ct. 423 (2012); Chevron Corp. v.
Donziger, 871 F. Supp. 2d 229 (S.D.N.Y. 2012); In re Chevron Corp.,
709 F. Supp. 2d 283 (S.D.N.Y. 2010), aff’d sub nom. Chevron Corp.
v. Berlinger, 629 F.3d 297 (2d Cir. 2011); In re Chevron Corp., 736
F. Supp. 2d 773 (S.D.N.Y. 2010). Familiarity with this background
is presumed.
2

Civ.

691,

2013

WL

1087236,

at

*3

(S.D.N.Y.

March

15,

2013)

(alteration in original) (emphasis and internal quotation marks
omitted) (the “March 15 Decision”); see also id. at *6-11, 13-15,
28-29.

I summarized these findings in a recent order:

[Judge Kaplan] found probable cause to believe that a
crime or fraud had been committed in connection with:
(1) Bribery of an Ecuadorian Judge, Nicolás
Zambrano, in order to obtain a favorable outcome in the
Ecuadorian litigation and allow the LAPs to compose the
judgment, which was then filed in the judge’s name;
(2) Interference with an independent inspection of
the pollution sites in Ecuador by (a) submitting an
expert report that purported to be the work of Dr.
Charles Calmbacher but contained views to which he did
not subscribe, and (b) using duress and coercion to
obtain the appointment of Richard Stalin Cabrera Vega as
the “global” court-appointed expert and then submitting
a report in Mr. Cabrera’s name that was in fact written
by lawyers and consultants retained by the LAPs; and
(3) Perpetuation of a fraud on the court in a
proceeding brought in the District of Colorado by Chevron
pursuant to 28 U.S.C. § 1782, in which Patton Boggs was
involved in the drafting and submission of an affidavit
by Pablo Fajardo, one of the LAPs’ attorneys, which
provided false information about the appointment of Mr.
Cabrera and the authorship of the report he submitted to
the Ecuadorian court.
Chevron Corp. v. Donziger, No. 11 Civ. 691, 2013 WL 3805140, at *12 (S.D.N.Y. July 19, 2013) (internal citations omitted)).
As noted above, there are two motions concerning privilege
logs at issue here. The first asserts that Mr. Donziger has waived
claimed privileges because (1) his privilege log is inadequate (Pl.

3

Memo. re Donziger at 1-2); (2) crime-fraud rulings “vitiate any
privilege” (Pl. Memo. re Donziger at 2-3); (3) communications with
third

parties

such

as

Stratus

Consulting

(“Stratus”),

Public

Citizen, Amazon Watch, and Rainforest Action Network are not
privileged (Pl. Memo. re Donziger at 3-4); and (4) communications
with media strategists are not privileged (Pl. Memo. re Donziger at
4).3
The second motion addresses the privilege log of

Mr. Naranjo

and Mr. Payaguaje, contending that they have waived their claims of
privilege because they have failed to log communications between
counsel of record for the defendants and (1) “any other law firm
that has represented anyone affiliated with the LAPs in any other
action,” including Patton Boggs, Emery Celli Brinckerhoff & Abady,
LLC, and Silver & DeBoskey, P.C.; (2) “any individual or entity
with whom the LAPs claim a common interest”; and (3) “any other
individuals or entities within the ambit” of the March 15 Decision

3

Chevron also states that its need for the documents
outweighs any claims of protection. (Pl. Memo. re Donziger at 4).
However, Chevron has waived this argument by failing to develop it.
See United States v. Fuentes, No. 09-cr-143, 2012 WL 4754736, at *3
(W.D.N.Y. April 25, 2012) (considering arguments that are “largely
conclusory, boilerplate, undeveloped and bereft of any supporting
case authority” waived); Lyn v. Incorporated Village of Hempstead,
No. 03 CV 5041, 2007 WL 1879502, at *16 n.13 (E.D.N.Y. June 28,
2007) (“Issues mentioned in a perfunctory manner, unaccompanied by
some effort at developed argumentation, are deemed waived . . . .”
(alteration in original) (internal quotation marks omitted)).
4

regarding the crime-fraud exception. (Pl. Memo. re Naranjo at 2,
3).

In addition, Chevron asserts that the log improperly claims

privilege for documents produced in other related litigation (Pl.
Memo. re Naranjo at 3), and that the log’s descriptions are so
deficient that these defendants should be found to have waived any
privilege (Pl. Memo. re Naranjo at 4).
A.

Donziger
1.

Sufficiency of the Privilege Log and the CrimeFraud Exception

Pursuant to Local Civil Rule 26.2(a)(2)(A), a party asserting
the attorney-client privilege or work product protection with
respect to any document must provide:
(i) the type of document, e.g., letter or memorandum;
(ii) the general subject matter of the document; (iii)
the date of the document; and (iv) the author of the
document, the addressees of the document, and any other
recipients, and, where not apparent, the relationship of
the author, addressees, and recipients to each other.
Moreover, the log must “provide[] information about the nature of
the withheld documents sufficient to enable the receiving party to
make

an

intelligent

determination

assertion of the privilege.”

about

the

validity

of

the

Automobile Club of New York, Inc. v.

Port Authority of New York and New Jersey,

F.R.D.

,

, 2013

WL 1903782, at *4 (S.D.N.Y. 2013); accord In re Methyl Tertiary
Butyl Ether (MTBE) Products Liability Litigation, 274 F.R.D. 106,
112 (S.D.N.Y. 2011); Orbit One Communications, Inc. v. Numerex
5

Corp., 255 F.R.D. 98, 109 (S.D.N.Y. 2008).
Mr. Donziger’s privilege log does not meet these standards.
It is rife with vague descriptions, such as “Email concerning
litigation status and strategy,” “Email concerning litigation
status and strategy re Lago Agrio litigation,” “Email concerning
litigation status and strategy re Donziger 1782,” and “Email
concerning draft memo.”

(Donziger Defendants’ April 11, 2013

Privilege Log, attached as Exh. A to Pl. Memo. re Donziger at 1,
50).

These entries and similar ones give little guidance to the

plaintiff as to whether a privilege is properly asserted.

The

insufficiency is particularly problematic in this case, given the
applicability of the crime-fraud exception.
Chevron asks that I hold that Mr. Donziger has waived his
claims of privilege.
While failure to properly identify privileged
documents in a privilege log can lead to waiver of the
privilege, usually the attorney-client privilege is only
waived when the party either failed to give any clear
indication that the documents were privileged, or
provided an inadequate privilege log where documents were
not properly specified.
Pem-America, Inc. v. Sunham Home Fashions, LLC, No. 03 Civ. 1377,
2007 WL 3226156, at *2 (S.D.N.Y. Oct, 31, 2007); see Aurora Loan
Services, Inc. v. Posner, Posner & Associates, P.C., 499 F. Supp.
2d 475, 479 (S.D.N.Y. 2007) (finding privilege waived where “log
does not identify which privilege is being asserted (attorney6

client or work product), and often does not identify the parties to
the communication”); Carte Blanche (Singapore) PTE., Ltd. v. Diners
Club International, Inc., 130 F.R.D. 28, 32 (1990) (finding waiver
of work product protection where privilege log failed to “specify
work product as the particular privilege protecting its various
documents”).

Indeed, “only flagrant violations of [discovery]

rules should result in a waiver of privilege.”

Dey, L.P. v.

Sepracor, Inc., No. 07 Civ. 2353, 2010 WL 5094406, at *2 (S.D.N.Y.
Dec. 8, 2010) (internal quotation marks omitted). The inadequacies
of Mr. Donziger’s privilege log are “not flagrant enough to warrant
full production of documents that likely contain some [privileged
material].”

In re In-Store Advertising Securities Litigation, 163

F.R.D. 452, 457 (S.D.N.Y. 1995) (footnote omitted).

He has

specified the documents with sufficient identifying information as
well

as

specified

the

privilege

claimed;

it

is

only

the

descriptions supporting the assertion of the privilege that are
insufficiently detailed.

In such a situation, Mr. Donziger should

be given an opportunity to supplement his privilege log with
descriptions of communications adequate to allow Chevron to assess
whether the privilege is properly asserted.

Mr. Donziger should

perform this task with an eye to the fact that the descriptions
should allow Chevron to determine whether the logged documents
might fall into the areas subject to the crime-fraud exception
7

pursuant to Judge Kaplan’s March 15 Decision.

In addition, I

caution Mr. Donziger that failure to sufficiently supplement the
log will expose him to the “risk [of] a broad finding of waiver.”
Favors v. Cuomo, 285 F.R.D. 187, 224 (E.D.N.Y. 2012) (citing Davis
v. City of New York, No. 10 Civ. 0699, 2011 WL 1742748, at *4
(S.D.N.Y. May 5, 2011)).
2.

Communications with Third Parties, including Media
Strategists

Chevron argues that “communications with third parties, such
as Stratus Consulting [], Public Citizen, Amazon Watch [], and
Rainforest
protection.

Action

Network”

are

not

entitled

(Pl. Memo. re Donziger at 3).

to

work

product

As to communications

with Stratus, Chevron relies on an opinion from the U.S. District
Court for the District of Colorado finding that privilege over many
documents reflecting communications between Stratus and Donziger
had been waived.

See Chevron Corp. v. Stratus Consulting, Inc.,

No. 10-cv-47, 2010 WL 3923092, at *3-4, 9-10 (D. Colo. Oct. 1,
2010). Chevron also argues that the privilege has been waived with
regard

to

other

“substantially

third-parties,
increase[d]

presumably

the

because

opportunity

adversaries to obtain the information.”

for

disclosure
potential

Merrill Lynch & Co. v.

Allegheny Energy, Inc., 229 F.R.D. 441, 445-46 (S.D.N.Y. 2004)
(internal quotation marks omitted).

8

Finally, it contends that

certain communications are not subject to the privilege because
they are not legal documents but rather public relations materials.
In the Colorado proceeding, filed pursuant to 28 U.S.C. §
1782, the court found that work product protection had been waived
for documents provided by Stratus or the LAPs to Mr. Cabrera, a
testifying

expert

in

the

Ecuadorian

Consulting, 2010 WL 3923092, at *9.

litigation.

Stratus

In addition, “communications

between [the LAPs], through their counsel, [] Stratus [], and Mr.
Cabrera and his team go directly to [the LAPs’] claims of damages
against [Chevron] arising out of the facts of the underlying
litigation,” and thus were subject to production “pursuant to the
sword-shield doctrine,” which prohibits a litigant from using “the
work product doctrine as a sword and a shield by selectively using
[] privileged documents to prove a point but then invoking []
privilege to prevent an opponent from challenging the assertion.”
Id. at *10 (internal quotation marks omitted).
Mr. Donziger does not respond to Chevron’s argument on this
point. Moreover, I find the Colorado court’s reasoning persuasive.
Therefore,

Mr.

Donziger

must

produce

documents

reflecting

communications with Stratus relating to the Cabrera report or to
any work provided to Mr. Cabrera.4

4

Chevron overstates the holding of the Colorado court,
asserting that it found privilege waived for “[c]ommunications with
9

I have already found that the interests of Amazon Watch and
the Rainforest Action Network are sufficiently “closely aligned
with the defendants that disclosure to them did not create a
substantial risk of further dissemination.”

(Memorandum and Order

dated Aug. 16, 2011, Chevron v. Salazar, No. 11 Civ. 3718, at 56).5

I adhere to that determination here.6
Finally, Chevron charges that certain withheld documents are

not legal communications, but rather public relations advice.
“[P]ublic

relations

advice,

even

if

it

bears

on

anticipated

litigation, [generally] falls outside the ambit of the work product

Stratus.” (Pl. Memo. re Donziger at 3). In reality, however, the
court’s holding is as I have described it above. Because Chevron
relies exclusively on the Colorado court’s opinion on this issue,
I assume that it seeks a ruling of waiver coextensive with that
opinion.
5

The Salazar case comprised the severed “Count 9” from the
complaint in this case. See Naranjo, 667 F.3d at 238; (Order dated
June 1, 2011, Salazar, No. 11 Civ. 3718, at 1-2).
6

Chevron asserts that, since my August 16, 2011 finding,
“Donziger’s [former] counsel has . . . disavowed the factual
predicate for any work product protection over documents shared
with A[mazon] W[atch],” and cites “Dkt. No. 021-13 (stating that
‘Kevin [Koenig] and the A[mazon] W[atch] people’ are not part of
the legal team; ‘Kevin is a collaborator, he is not part of the
legal team, and he is not subject to privilege and he does not know
everything we are doing.’).” (Pl. Memo. re Donziger at 3 (fifth
through seventh alterations in original)). There are two problems
with this assertion: (1) the document referred to pre-dates my
August 16, 2011 order and (2) no such statement appears in the
document. Even if such a statement existed and post-dated August
16, 2011 -- and I presume that the plaintiff does not expect me to
search through the 1,332 documents currently docketed in this
action to find it -- it would not change my opinion on this issue.
10

doctrine.”

Egiazaryan v. Zalmayev, __ F.R.D. __, __, 2013 WL

945462, at *12 (S.D.N.Y. 2013) (internal quotation marks omitted)
(second alteration in original).

Indeed,

the work product doctrine does not extend to public
relations activities even if they bear on litigation
strategy because the purpose of the rule is to provide a
zone of privacy for strategizing about the conduct of
litigation itself, not for strategizing about the effects
of the litigation on the client’s customers, the media,
or the public generally.
Id. (internal quotation marks omitted); see also Chevron Corp. v.
Salazar, No. 11 Civ. 3718, 2011 WL 3880896, at *1 (S.D.N.Y. Sept.
1, 2011). However, Chevron has not identified those documents that
it believes constitute unprotected public relations advice.

If it

seeks production of such documents, it must identify them by
document number so that they can be produced by the defendant or
submitted for in camera review.
B.

Naranjo and Payaguaje
1. Common Interest

Chevron complains that Mr. Naranjo and Mr. Payaguaje have
produced a privilege log that excludes communications between the
LAPs and common-interest counsel, clients, or defendants.
Memo. re Naranjo at 1-2).

(Pl.

Mr. Naranjo and Mr. Payaguaje counter

that the parties have an agreement that exempted common interest
materials from logging.

(Javier Piaguaje Payaguaje’s and Hugo

Gerardo Camacho Naranjo’s Opposition to Chevron Corporation’s
11

Motion to Compel Defendants Javier Piaguaje Payaguaje[] and Hugo
Gerardo Camacho Naranjo to Produce Documents Withheld (“Naranjo
Memo.”) at 3). In addition, they contend that I have “consistently
ordered that such communications and documents need not be produced
or logged, particularly as they relate to the present action or the
related § 1782 Actions.”

(Naranjo Memo. at 2-3).

The exhibits submitted in connection with this motion do not
demonstrate that the parties had an agreement not to log common
interest materials.

Rather, they show a difference of opinion

about whether there was such an agreement.

(Letter of G. Charles

Nierlich dated March 1, 2013, attached as Exh. 5 to Pl. Memo. re
Naranjo, at 1; Letter of Hector R. Chavez dated March 12, 2013,
attached as Exh. 6 to Pl. Memo. re Naranjo, at 1).

Therefore,

this is not a basis on which to excuse the failure to log such
communications.
privilege.

It is likewise not a basis to find waiver of the

See Dey, 2010 WL 5094406, at *2.

However, Mr. Naranjo and Mr. Payaguaje are correct that in the
related Salazar case, I found that communications among counsel
created in that litigation or in related Section 1782 proceedings
were not subject to production or logging.

(Order dated Sept. 7,

2011, Salazar, No. 11 Civ. 3718, at 1; Order dated Sept. 2, 2011,
Salazar, No. 11 Civ. 3718, at 2).

Although the logic of those

decisions also applies to documents created in connection with this
12

litigation, Judge Kaplan’s crime-fraud findings undermine it with
respect to the Colorado Section 1782 proceeding.

Therefore, Mr.

Naranjo and Mr. Payaguaje must supplement their privilege log to
include documents reflecting communications with common interest
counsel, clients, or defendants created in connection with that
Section 1782 proceeding.
2.

Sufficiency of the Privilege Log
a.

Documents Produced in Other Actions

Where a party voluntarily discloses privileged documents to an
adversary in one proceeding, it cannot withhold the same documents
on the basis of privilege in a subsequent proceeding, even if that
subsequent proceeding involves a different adversary.

See In re

Steinhardt Partners, L.P., 9 F.3d 230, 235 (2d Cir. 1993) (“The
waiver doctrine provides that voluntary disclosure of work product
to an adversary waives the privilege as to other parties [in a
subsequent

proceeding].”);

Urban

Box

Office

Network,

Inc.

v.

Interfase Managers, L.P., No. 01 Civ. 8854, 2004 WL 2375819, at *3
(S.D.N.Y. Oct. 21, 2004) (applying same principle to attorneyclient privilege). Chevron asserts that the privilege log contains
listings for documents produced in other actions.
Naranjo at 3-4).

(Pl. Memo. re

It characterizes this as “padd[ing]” the log and

“flouting” discovery obligations.

(Pl. Memo. re Naranjo at 4).

There is no evidence that Mr. Naranjo and Mr. Payaguaje
13

produced

their

privilege

disregard for the rules.

log

in

bad

faith

or

with

flagrant

It bears repeating that this litigation

has spawned “dozens of discovery proceedings pursuant to 28 U.S.C.
§ 1782 throughout the United States,” making it “‘unique in the
annals of American judicial history.’” Naranjo, 667 F.3d at 236
(quoting In re Chevron Corp., 650 F.3d 276, 282 n.7 (3d Cir.
2011)).

The fact that Chevron found 33 documents on the privilege

log of Mr. Naranjo and Mr. Payaguaje that “seem to have been
previously produced” (Pl. Memo. re Naranjo at 4) does not support
Chevron’s hyperbole, and I do not find that Mr. Naranjo and Mr.
Payaguaje have broadly waived protection over the documents on
their log, see Dey, 2010 WL 5094406, at *2.7
b.
As

with

Mr.

Document Descriptions
Donziger’s

privilege

log,

the

document

descriptions in the privilege log of Mr. Naranjo and Mr. Payaguaje
are inadequate. Their log contains a significant number of entries
with descriptions such as “[w]orking draft of legal pleading
concerning Maria Aguinda et al. v. Chevron re: experts,” “[w]orking
draft of legal pleading concerning Maria Aguinda et al. v. Chevron
re:

judicial

inspection

report,”

7

and

“[c]onfidential

legal

Chevron does not ask that the documents disclosed in other
actions be produced, presumably because it is already in possession
of them.
14

memorandum
testimony.

with
11

exhibits

reflecting

legal

analysis

of

witness

(Amended Privilege Log Pertaining to Defendants Hugo

Gerardo Camacho Naranjo and Javier Piaguaje Payaguaje dated April
. Memo. re Naranjo, at I,

II, 2013, attached as part of Exh. 2 to
9, 24).

As with Mr. Donziger's log, the log of Mr. Naranjo and Mr.

Payaguaje must be similarly supplemented.
Mr.

Naranj 0

and Mr.

Payaguaj e

privilege over these document,

have

I do not now find that

waived

see Dey,

the

protections

2010 WL 5094406,

of

at *2;

however, failure to supplement sufficiently may also expose them to
a broad finding of waiver, see

~~~.~,

285 F.R.D. at 224.

Conclusion
For

the

foregoing

reasons

I

Chevron's

motion

to

compel

as

against Mr. Donziger (Docket no. 1194) and its motion to compel as
against Mr. Naranjo and Mr. Payaguaje (Docket no. 1195) are each
granted in part and denied in part as discussed above.

These

defendants shall produce amended privilege logs within two weeks
the date of this order.

In addition,

within that same time Mr.

Donziger shall produce all documents

identified as having been

improperly withheld.
SO ORDERED.

JAMES C. FRANCIS IV
UNITED STATES MAGISTRATE JUDGE
15

Dated:

New York, New York
August 9, 2013

Copies mailed

s date:

Randy M. Mastro, Esq.

Andrea E. Neuman, Esq.

Gibson, Dunn & Crutcher, LLP

200 Park Avenue, 47th Floor

New York, New York 10166

William E. Thomson, Esq.

Gibson, Dunn & Crutcher LLP

333 South Grand Avenue

Los Angeles, CA 90071

Steven R. Donziger, Esq.

Law Offices of Steven R. Donziger, P.C.

245 W. 104th St., #7D

New York, NY 10025

Julio C. Gomez, Esq.

Gomez LLC

111 Quimby St., Suite 8

Westf ld, NJ 07090

16