Treehouse Foods, Inc. et al v. Green Mountain Coffee Roasters, Inc. et al

Filing 137

OPINION AND ORDER. Accordingly, for all the foregoing reasons, I conclude that the Protective Order permits a party that receives, through inadvertence, a document or other information which the adverse party asserts is privileged, may, pending a det ermination of the claim of privilege, use the content of that document or information for the limited purpose of challenging the assertion of privilege to the extent that the receiving party learned of the contents of the document in issue prior to t he producing party's assertion of privilege. So ordered. (Signed by Magistrate Judge Henry B. Pitman on 5/7/2019) Filed In Associated Cases: 1:14-md-02542-VSB-HBP et al., as per Chambers. Copies transmitted to: All Counsel. Hon. Barbara S. Jones, United States District Judge (retired). (rjm)

USDCSDNY

DOCUMENT
ELECTRONICALLY FILED

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

DOC#:

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nATB FIL--.-ED_:_s-:_2-;~z-'l-C7\-"\-

14 MD 2542

IN RE:
KEURIG GREEN MOUNTAIN
SINGLE SERVE COFFEE ANTITRUST
LITIGATION

(VSB) (HBP)

OPINION
AND ORDER

-----------------------------------x
PITMAN, United States Magistrate Judge:
I write to resolve the parties' dispute concerning the
extent to which a party can use the contents of a putatively
privileged document that was inadvertently produced to challenge
the producing party's assertion of privilege.

For the reasons

set forth below, I conclude that the receiving party can use the
contents of such documents in resolving the privilege issue at
least to the extent the receiving party had knowledge of the
contents of the document before the assertion of privilege.
In January of this year, I approved a stipulated
protective order in this matter.

Paragraph 22 of that Order

provides, in pertinent part:
22.
Pursuant to Rule 502(d) of the Federal rules
of Evidence, the inadvertent disclosure of documents,
ESI, testimony, information and/or other things that
are protected from disclosure under the attorney-client
privilege, work-product doctrine, and/or any other
applicable privilege, protection or immunity ("Privileged Material") shall in no way prejudice or otherwise
constitute a waiver of, or estoppel as to, any claim of
privilege, work-product or any other applicable
privilege, protection, or immunity in this or any other
Federal or State proceeding for the inadvertently
produced document or specific material or information
disclosed, or any other document, material, or information covering the same or a similar or related subject

matter.
. If a party has inadvertently or mistakenly produced Privileged Material, and if the party
makes a written request for the return, pursuant to
this paragraph, of any Privileged Material (including
any analyses, memoranda or notes that were internally
generated based upon such inadvertently-produced Privileged Material) then in the custody of another party or
non-party, the possessing person or entity shall either
sequester the Privileged Material and all copies
thereof, or return the Privileged Material within ten
(10) business days, and the receiving party will also
make no use of the information contained in the Privileged Material or further disseminate the Privileged
Material regardless of whether the receiving party
disputes the claim of privilege.
. If the receiving
party disputes the assertion of privilege, the receiving party may move the Court for an Order compelling
the production of the material.
The burden of showing
that the material is privileged and that its production
was inadvertent shall be determined under applicable
law, including Federal Rule of Evidence 502. The
receiving party may not use the Privileged Material or
any other document or material information reflecting
the contents of the Privileged Material for any purpose
whatsoever other than moving the Court for an order
compelling production of the Privileged Material until
the Court has determined that the material is not
privileged.
(Stipulated Amended Protected Order, dated Jan. 11, 2019 (Docket
Item ("D.I.") 470)

("Protective Order") , 22).

Defendant contends that the foregoing language, particularly the sentence" [i]f a party has inadvertently or mistakenly
produced Privileged Material, and if the party makes a written
request for the return,

the receiving party will also make

no use of the information contained in the Privileged Material or
further disseminate the Privileged Material regardless of whether
the receiving party disputes the claim of privilege," prohibits
the receiving party from using the contents of the inadvertently
2

produced material to challenge the assertion of a privilege.
Plaintiffs claim that the sentence
use the Privileged Material

11

[t]he receiving party may not

. for any purpose whatsoever

other than moving the Court for an order compelling production of
the Privileged Material until the Court has determined that the
material is not privileged," takes priority over the more general
language cited by defendant and permits a receiving party to use
the contents of inadvertently produced material for the limited
purpose of challenging the assertion of the privilege.
The parties cite no authority in support of their
respective positions, and my own research has disclosed only two
cases addressing the issue, both authored by the late Honorable
Robert W. Sweet, United States District Judge.

In American

Express v. Accu-Weather, Inc., 91 Civ. 6485 (RWS), 92 Civ. 705
(RWS), 1996 WL 346388 (S.D.N.Y. June 25, 1996), plaintiff's
counsel sent documents to plaintiff's counsel by Federal Express.
On the day the package was delivered to Federal Express, plaintiff's counsel realized that he had inadvertently included
privileged documents in the production.

The next morning, before

the package had been opened, plaintiff's counsel called defendant's counsel, advised that the package contained privileged
documents that had been inadvertently included and directed
defendant's counsel to refrain from opening the package and
inspecting the contents.

Despite the request from plaintiff's

3

counsel, defendant's counsel opened the package and inspected the
contents.
Judge Sweet found that defendant's counsel's conduct
constituted an ethical violation:
The American Bar Association Formal Ethics Opinion
92-368 (the "Opinion") entitled Inadvertent Disclosure
of Confidential Materials, November 10, 1992, addresses
this precise issue and establishes that an attorney who
receives materials that on their face appear to be
subject to the attorney-client privilege or otherwise confidential, under circumstances where it is
clear they were not intended for the receiving
lawyer, should refrain from examining the materials, notify the sending lawyer and abide by the
instructions of the lawyer who sent them.
ABA Formal Op. 92-368, p. 1. The Opinion reflects
a strong confidentiality policy and maintains that any
competing principles "pale in comparison to the importance of maintaining confidentiality." Id., p. 3.
In an evaluation of competing principles, the
Opinion acknowledges that protection of confidential
materials may be useless once the materials are mistakenly sent. However, [the Opinion] point[s] out that
this is not an issue when the receiving lawyer is aware
of the mistake prior to reviewing the documents, as in
this case.

*

*

*

In light of this Opinion, and the important policy
concerns it embodies, [defendant's counsel's] conduct
constituted an ethical violation.
[Plaintiff's counsel] explicitly stated that the package should not be
opened and that document XX-173 was privileged. [Defendant's counsel] did not abide by Potter's instructions,
and instead "g[a]ve[] in to temptation." According to
the Opinion, they should have adhered to the instructions and not decided for themselves if the document

warranted the attorney-client privilege.
1996 WL 346388 at *2.
4

In Stinson v. City of New York, 10 Civ. 4228, 2014 WL
5090031 (S.D.N.Y. Oct. 10, 2014), however, Judge Sweet concluded
that the receiving party could use the contents of the putatively
privileged documents to contest the assertion of privilege where
the receiving party learned of the contents prior to the assertion of privilege.
There have been instances in this district when
parties who have reviewed inadvertently disclosed
documents before claw back have relied on what they
have learned prior to notification for purposes of
challenging the asserted claim of privilege.
For
example, in Synergetics, the defendant had requested
that plaintiff return thirty-five pages of documents
because they had been inadvertently produced and were
protected, inter alia, by attorney-client privilege.
Synergetics, 2009 WL 2016795, at *1. The defendant
filed a motion for return of the inadvertently produced
documents. The plaintiff contested the issue of
whether certain documents were protected by the attorney-client privilege and made direct reference to the
purportedly privileged documents in its motion papers.
See Synergetics, No. 08 Civ. 3669, Dkt. No. 82. Likewise in Graves v. Deutsche Bank Securities, Inc., No.
07 Civ. 5471, 2011 WL 721558 (S.D.N.Y. Feb.10, 2011),
Magistrate [Judge Kevin] Fox allowed the objecting
party to describe the contents of the purportedly
privileged documents at issue.
See Graves, No. 07 Civ.
5471, Dkt. No. 84.
Additionally, the Association of the Bar of the
City of New York has found that while lawyers are
ethically bound to return or destroy inadvertently
disclosed documents, the non-disclosing lawyer is not
ethically barred from using information gleaned prior
to knowing or having reason to know that the communication contains information not intended for the non-disclosing lawyer. See Assoc. for the Bar of the City of
New York Formal Op. 2003-2004, 2003 WL 23789274, *7-*8
(limiting the use of information from challenged to

documents to information learned "prior to knowing or
having reason to know that the communicated was misdirected"). As such, while Plaintiffs must return re5

maining copies of the Documents, the Plaintiffs may
rely on any information learned prior to notification
of the inadvertent disclosure for the purposes of
litigating the privilege claim.
2014 WL 5090031 at *4.
Admittedly, neither American Express nor Stinson
involved an agreement among the parties concerning the handling
of inadvertently produced privileged material similar to the
Protective Order in this matter.

Nevertheless, given the tension

between the sentences on which plaintiffs and defendants rely,
the decisions are instructive.
In addition, plaintiffs' interpretation of the Protective Order is more consistent with the Federal Rules of Civil
Procedure.

Rule 26(b) (5) (B) provides that if a party receives

notice that an adversary has inadvertently produced privileged
information, the receiving party "may promptly present the
information to the court under seal for a determination of the
claim."

The Advisory Committee Notes to this provision permit

the receiving party "to use the content of the information only
to the extent permitted by the applicable law of privilege,
protection for trial-preparation material, and professional
responsibility."

2006 Advisory Committee Notes to Rule 26.

Because no law or rule of professional responsibility 1 prohibits

1

The only obligation imposed by New York's Rules of
Professional Conduct on an attorney who receives inadvertently
produced privileged material is to notify the producing party.
(continued ... )
6

a party from using inadvertently produced material to challenge
the assertion of a privilege or other protection, it appears that
the Federal Rules of Civil Procedure permit a party that receives
an inadvertently produced privileged document to use the content
of that document to challenge the assertion of privilege.
Accordingly, for all the foregoing reasons, I conclude
that the Protective Order permits a party that receives, through
inadvertence, a document or other information which the adverse
party asserts is privileged, may, pending a determination of the
claim of privilege, use the content of that document or information for the limited purpose of challenging the assertion of
privilege to the extent that the receiving party learned of the
contents of the document in issue prior to the producing party's
assertion of privilege.
Dated:

New York, New York
May 7, 2019
SO ORDERED

HENRYPI
United States Magistrate Judge
Copies transmitted to:
All Counsel
Hon. Barbara S. Jones
United States District Judge (retired)

1

( • • • continued)
N.Y. Rules of Prof. Conduct 4.4(b)

7