United States District Court, S.D. New York
February 17, 2004.
IN RE WORLDCOM, INC. SECURITIES LITIGATION, This Document Relates to: 03 Civ. 0169, 03 Civ. 0168, 03 Civ. 0171, 03 Civ. 0338, 02 Civ. 9520, 03 Civ. 8981, 03 Civ. 0892, 03 Civ. 0891, 03 Civ. 4499, 03 Civ. 1283, 03 Civ. 0998, 03 Civ. 3859, 03 Civ. 6592, 03 Civ. 6227, 03 Civ. 6226, 03 Civ. 7806, 03 Civ. 3593, 03 Civ. 6221, 03 Civ. 3599, 03 Civ. 6220, 03 Civ. 3597, 03 Civ. 3594, 03 Civ. 3598, 03 Civ. 6224, 03 Civ. 6223, 03 Civ. 1284, 03 Civ. 9823, 03 Civ. 8924, 03 Civ. 0167, 03 Civ. 0170, 03 Civ. 0337, 03 Civ. 0890, 03 Civ. 2839, 03 Civ. 3860, 03 Civ. 6225, 03 Civ. 3595, 03 Civ. 2840, 03 Civ. 3591, 03 Civ. 3596, 03 Civ. 6228, 03 Civ. 9824, 03 Civ. 8271, 02 Civ. 9518, 03 Civ. 4500
The opinion of the court was delivered by: DENISE COTE, District Judge
By letters to the Court dated January 27, 2004, defendants against
whom the Individual Actions are not stayed ("Defendants") raised certain
disputes regarding the scope of the Individual Actions plaintiffs'
("Plaintiffs") review and production of documents and information
responsive to Defendants' First Request to Plaintiffs in Certain of the
Individual Actions For the Production of Documents (the "Document
Request"), and Defendants' First Set of Interrogatories to Plaintiffs in
Certain of the Individual Actions (the "Interrogatories;" together with
the Document Request, the "Discovery Requests"). On January 28,
2004, the Court received a submission from Liason Counsel in the
Individual Actions regarding the Discovery Requests. Having reviewed the
various submissions from counsel regarding the Discovery Requests, and
having heard argument from counsel at the conference of January 29, 2004,
for the reasons stated on the record at January 29 conference, it is
1. Time Period for Search and Production
Plaintiffs are required to search for and produce responsive documents
and information for the time period beginning January 1. 1999, or six
months before a plaintiff's first WorldCom investment (whether debt or
equity and whether or not the plaintiff has brought a claim on that
WorldCom Investment), whichever is earlier, but in no event before
January 1, 1997.
2. Records of Trading in WorldCom Debt and Equity Securities
Plaintiffs are required to produce summary trading records of their
investments in WorldCom securities, whether debt or equity, which are
kept in the ordinary course ("Summary Trading Records"). Plaintiffs are
not required to produce the transactional documents underlying their
Summary Trading Records. If after production of Summary Trading Records,
there is a reasonable basis to believe that the Summary Trading Records
produced by any Plaintiff are unreliable, then targeted discovery of some
underlying documents may be requested to test whether the Summary Trading
Records are reliable.
3. The Investment Decision-Making Carve Out for Institutional
If there was a complete segregation of investment decision-making
between WorldCom equity trading and WorldCom debt trading on behalf of
and within an institutional Plaintiff and that Plaintiff is asserting
only Securities Act claims, that Plaintiff need not search or produce its
equity files (except for Summary Trading Records) in response to the
Discovery Requests, provided however that the Plaintiff establishes by
affidavit that there was a complete segregation during the relevant time
period in decision-making between debt and equity trading in WorldCom
securities. This ruling is without prejudice to Defendants' right to seek
documents and information relating to such Plaintiff's WorldCom equity
transactions upon a showing that the Plaintiff's WorldCom equity
decision-makers provided information to the Plaintiff's WorldCom debt
decision-makers, or otherwise influenced the Plaintiff's decisions to
purchase or sell WorldCom debt.
4. Transactions in Securities Other Than WorldCom
Plaintiffs asserting only Securities Act claims are not required to
produce documents with respect to their non-WorldCom investments.
Plaintiffs asserting Exchange Act or fraud-based claims must produce
summary records, created in the ordinary course, of all of their
non-WorldCom securities investments. Plaintiffs asserting Exchange Act or
fraud-based claims shall meet and confer with Defendants concerning the
production of summary trading records of the purchase and sale of
the telecommunications sector. If the parties are unable to agree
upon the appropriate scope of such discovery, they shall inform the Court
no later than March 5.
5. Personnel Files
Plaintiffs are required to produce documents sufficient to identify
each of the persons who made investment decisions regarding WorldCom
securities. Plaintiffs are not required to search or produce personnel
files, resumes or curriculum vitae for such individuals. If a Defendant
shows that there is reason to believe that a decision-maker has been
disciplined or sanctioned in connection with any WorldCom investment
decision, then the Defendant may request documents relating to such
disciplinary action or sanction.
6. Individual Discovery Disputes
Plaintiffs in the action captioned Public Employees Ret. Svs. of
Ohio, et al. v. Ebbers, et al., No. 03 Civ. 0338 (DLC) shall produce
documents responsive to Document Request No. 2, subpart (b).
Plaintiffs in the following actions, which were commenced on or after
February 6, 2003 and on or before June 25, 2004, shall meet and confer
with Defendants regarding the production of documents responsive to
Document Request No. 14. If the parties are unable to agree upon the
appropriate scope of discovery, they shall inform the Court no later than
Clark, et al. v. Ebbers, et al., 03 Civ.
6228 (S.D.N.Y.) (filed 2/12/03)
The Maryland-National Capital Park &
Planning Commission Employes' Retirement System v.
Citigroup, Inc., et al., 03 Civ. 3859
(S.D.N.Y.) (filed 2/27/03)
Heavy & General Laborers' Locals 472 and
172 Pension & Annuity Funds, et al. v.
Citigroup, Inc., et al., 03 Civ. 3860
(S.D.N.Y.) (filed 3/3/03)
Maintenance Employees Teamsters Local 416
Pension Funds, et al. v. Bernard J. Ebbers, et
al., 03 Civ. 4500 (S.D.N.Y.) (filed 3/27/03)
State of Alaska Dept. of Revenue, et al. v.
Citigroup, Inc., et al., 03 Civ. 6592
(S.D.N.Y.) (filed 4/21/03)
Pacific Life Ins. Co., et al. v. J.P. Morgan
Chase & Co., et al., 03 Civ. 6225
(S.D.N.Y.) (filed 4/25/03)
Municipal Employees Ret. Sys. of Michigan v.
Citigroup, Inc., et al., 03 Ci. 6227
(S.D.N.Y.) (filed 4/30/03)
Maine State Ret. Sys. v. Citigroup, et
al., 03 Civ. 6226 (S.D.N.Y.) (filed 5/9/03)
Brinson, et al. v. Ebbers, et al., 03
Civ. 6230 ((S.D.N.Y.) (filed 5/16/03)
The Northwestern Mut. Life Ins. Co. v.
Citigroup, Inc., et al., 03 Civ. 9824
(S.D.N.Y.) (filed 5/30/03)
American International Group Annuity
Insurance Company, et al. v. Bernard J. Ebbers, et
al., 03 Civ. 9823 (S.D.N.Y.) (filed 6/11/03)
Carpenters Pension Trust for Southern CA v.
Bernard J. Ebbers, et al., 03 Civ. 7806
(S.D.N.Y.) (filed 6/11/03)
7. Any plaintiff in an Individual Action who is served with the
Discovery Requests and a copy of this Order, and who did not have any
opportunity to be heard on these issues on or before January 29, 2004,
shall be governed by this Order unless it objects by February 27, 2004,
or within two weeks of such service, whichever is later.
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