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United States District Court, S.D. New York

April 13, 2005.


The opinion of the court was delivered by: JAMES FRANCIS, Magistrate Judge


This case arises out of the refusal of the City of New York to award a franchise for provision of wireless telecommunication services to the plaintiff, NextG Networks of NY, Inc. ("NextG"). NextG now moves pursuant to Rule 37 of the Federal Rules of Civil Procedure for an order compelling the defendants (referred to collectively as the "City") to produce certain documents. Originally, three categories of documents were at issue. However, the parties have reached agreement with respect to the production of two: documents relating to tax payments made by Verizon (a competitor of NextG that was awarded a franchise) and documents relating to the location and scope of Verizon's facilities. Thus, only documents relating to the City's implementation of Resolution No. 957, including requests for proposal and franchise processes, remain at issue. NextG also requests sanctions, including an award of attorneys' fees, in connection with this motion, and it seeks reconsideration of my order holding that discovery has closed.

For the reasons set forth below, the plaintiff's motion to compel is granted, its application for an award of fees is denied, and its request to reopen discovery is denied except insofar as further inquiry may be necessitated as a result of the disclosure required by this Order.


  In Plaintiff's First Request for Production of Documents, NextG demanded production of


[a]ll documents referring to, relating to, or reflecting any action taken by the City or DoITT [the Department of Information Technology and Telecommunications] pursuant to Resolution No. 957 of 1999 ("Resolution No. 957") of the City of New York, including but not limited to documents referring to, relating to, or reflecting any drafts of, proposals for, or final adoptions of any RFP [request for proposal] pursuant to Resolution No. 957 or any drafts of franchises related to Resolution No. 957.
(Affidavit of T. Scott Thompson dated Jan. 6, 2005 ("Thompson Aff."), Exh. 4 at 5). In response to this request, the City stated:
Defendants object to this request on the grounds that it is overbroad, vague, burdensome and seeks materials neither relevant to the issues in this action nor reasonably calculated to lead to the discovery of admissible evidence. Subject to and without waiving such objection, defendants are producing the Request for Proposal ("RFP") issued by DoITT on February 9, 2004 pursuant to Resolution No. 957 (Bate Stamp Nos. 1-36).
(Thompson Aff., Exh. 4 at 5-6). In addition, in its general statement, the City stated: Defendants object to this Document Request to the extent that it demands documents and/or information which are protected by the attorney-client or work-product privilege, or which constitute material prepared for litigation purposes. Defendants also object in the entirety to any request for documents which is not limited in time.

 (Thompson Aff., Exh. 4 at 1-2).

  On April 28, 2004, NextG submitted a letter application seeking to compel production of additional documents responsive to this and other requests. The City responded on June 2, 2004, arguing that the information sought was irrelevant and that the request for documents relating to Resolution No. 957 ("Request No. 7") was duplicative, but raising no claims of privilege. (Thompson Aff., Exh. 1). Thereafter, I issued an order dated June 14, 2004, that, in part, directed the City to respond to Request No. 7 by producing "all drafts of Requests for Proposal ("RFP"), documents concerning the drafting of such RFP's, drafts of franchises related to Resolution No. 957, and internal correspondence (including emails) concerning requests for access to public rights-of-way that would be governed by Resolution No. 957." (Order dated June 14, 2004, para. 2). The City appealed this Order, again without raising any claims of privilege. (Thompson Aff., Exh. 5). The Order was affirmed. (Decision and Order dated Aug. 9, 2004).

  In the June 14 Order, I also directed the City to submit forthwith a privilege log. It ultimately did so on December 22, 2004, asserting claims of confidentiality, deliberative process privilege, attorney-client privilege, and work product protection with respect to some 81 documents as well as three categories incorporating an unidentified number of documents. (Thompson Aff., Exh. 6). NextG then filed the instant motion, arguing that the City has failed to comply with my June 14 Order in that it continues to withhold responsive documents. According to NextG, the City waived the privileges that it now asserts with respect to those documents, and, in any event, the claims of privilege have not been substantiated.


  A. Privilege

  If a claim of privilege is not asserted at the time that a party responds to a discovery request, the privilege is waived. See Melendez v. Greiner, No. 01 Civ. 7888, 2003 WL 22434101, at *2 (S.D.N.Y. Oct. 23, 2003); Bowne of New York City, Inc. v. Ambase Corp., 150 F.R.D. 465, 489-90 (S.D.N.Y. 1993). A party cannot simply hold in reserve its objections on grounds of privilege "for later strategic use." Bank Brussels Lambert v. Chase Manhattan Bank, N.A., No. 93 Civ. 5298, 1998 WL 567862, at *2 (S.D.N.Y. Sept. 3, 1998). Indeed, the local civil rules in this district require that a party withholding a document on the basis of privilege provide complete identifying information, date, type of document, and subject matter "at the time of the response to . . . discovery[.]" Local Civil Rule 26.2(c). When it responded to NextG's document demands, the City plainly failed to assert the privileges that it now seeks to raise. It never mentioned confidentiality or deliberative process privilege at all. It alluded to the attorney-client privilege and work product doctrine only in the "General Statement" section of its responses, and not in connection with any specific document or even with respect to any particular request. Now the City argues that in my June 14 Order I somehow acquiesced in the tardy assertion of privilege by directing that a privilege log be filed. (Memorandum of Law in Opposition to Plaintiff's Motion to Compel at 16). That is not the case. The Order did not address the waiver issue at all, and in any event it was incumbent on the City to provide a privilege list for any document that it was withholding, including those that were outside the subject matter of the order. Accordingly, the privileges that the City belatedly seeks to raise with respect to the documents that I directed be produced in Request No. 7 have been waived.

  Even if that were not the case, the City has failed to satisfy its burden of demonstrating that any privilege attaches. The attorney-client privilege provides that "(1) where legal advice of any kind is sought (2) from a professional legal advisor in his capacity as such, (3) the communications relating to that purpose, (4) made in confidence (5) by the client, (6) are at his instance permanently protected (7) from disclosure by himself or by the legal advisor, (8) except the protection be waived." United States v. International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, AFL-CIO, 119 F.3d 210, 214 (2d Cir. 1997) (citation and internal quotation marks omitted). The burden of establishing the existence of each of the elements of the privilege rests with the party asserting it. In re Grand Jury Proceedings, 219 F.3d 175, 182 (2d Cir. 2000); United States v. Adlman, 68 F.3d 1495, 1500 (2d Cir. 1995). Here, the City has based its privilege arguments exclusively on its belated privilege log. It has submitted no affidavit explaining the context in which any of the communications were made. Indeed, in some instances neither the author nor the recipient of the supposedly privileged document is identified except by name, and it is consequently impossible to determine whether either is an attorney. Even where a communication is identified as having involved a lawyer, there is no evidence that it was created for the purpose of providing or obtaining legal rather than business advice, that it was intended to remain confidential, and that the privilege has not been waived.

  The City's assertion of the deliberative process privilege is similarly deficient. In order for the privilege to attach, a document must be both "predecisional" and "deliberative." See National Congress for Puerto Rican Rights v. City of New York, 194 F.R.D. 88, 92 (S.D.N.Y. 2000). To demonstrate that a document is predecisional, an agency must: (i) pinpoint the specific decision to which the document correlates, (ii) establish that its author prepared the document for the purpose of assisting the agency official charged with making the agency decision, and (iii) verify that the document precedes, in temporal sequence, the decision to which it relates.

 Id. (quoting Providence Journal Co. v. United States Department of the Army, 981 F.2d 552, 557 (1st Cir. 1992)). "Thus, the privilege protects `recommendations, draft documents, proposals, suggestions, and other subjective documents which reflect the personal opinions of the writer rather than the policy of the agency.'" Id. (quoting Grand Central Partnership, Inc. v. Cuomo, 166 F.3d 473, 482 (2d Cir. 1999)). It does not protect third-party documents submitted in connection with an agency decision. See Kaufman v. City of New York, No. 98 Civ. 2648, 1999 WL 239698, at *4 (S.D.N.Y. April 22, 1999). As with the attorney-client privilege, it is the burden of the party raising the deliberative process privilege to demonstrate its applicability. See Bath Petroleum Storage, Inc. v. Sovas, 309 F. Supp. 2d 357, 363 (N.D.N.Y. 2004); In re Grand Jury Subpoena dated August 9, 2000, 218 F. Supp. 2d 544, 553 (S.D.N.Y. 2002). Again, however, the City has not provided evidence showing that these requirements have been met. For example, many of the documents listed in the City's log as subject to this privilege have only the scantest identifying information, and no affidavit has been submitted that would remedy this shortcoming.

  Accordingly, the City's claims of privilege are rejected, both because they have been waived and because, even now, the City has failed to carry its burden of demonstrating the applicability of the privileges asserted.

  B. Sanctions

  Where a party has disobeyed a discovery order, the court may require "the party failing to obey the order or the attorney advising that party or both to pay the reasonable expenses, including attorney's fees, caused by the failure, unless the court finds that the failure was substantially justified or that other circumstances make an award of expenses unjust." Fed.R.Civ.P. 37(b)(2). In this case, while it is a close question, there was sufficient justification for the City's failure to produce the requested documents until privilege issues had been resolved.

  To be sure, the privileges have been waived with respect to the documents at issue. But that waiver is the result of litigation failures, not of a conscious decision to abandon the privileges, and the City was entitled to a determination of whether a waiver had actually occurred. And, while the City has been less than diligent in meeting its discovery obligations in this case, it has not engaged in the kinds of repeated discovery abuses or manipulation of the discovery process that warrant sanctions. See Selletti v. Carey, 173 F.3d 104, 110 (2d Cir. 1999). Finally, the expenses incurred by NextG in connection with this motion are equivalent to the costs that it would have expended in any event if the City had litigated the privilege issues in a timely fashion. Therefore, no sanctions will be awarded.

  C. Scheduling

  The parties now agree that discovery is concluded except with respect to the documents related to plaintiff's Request No. 7. (Plaintiff's Reply Memorandum of Law in Support of Motion to Compel, for Sanctions, and for Reconsideration of Discovery Schedule at 10). Since it is conceivable that the production of those documents would necessitate follow-up discovery, it is appropriate to extend that discovery deadline for a very limited period and only for that purpose.


  For the reasons set forth above, the City shall produce within two weeks of the date of this Order all documents encompassed by paragraph 2 of my Order of June 14, 2004. Within two weeks thereafter, NextG shall advise the City and the Court of any residual discovery it proposes to take in connection with the documents produced. Otherwise, discovery is closed. NextG's application for an award of sanctions in connection with this motion is denied.



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