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Chevron Corporation v. Donziger

United States District Court, Second Circuit

May 14, 2013

CHEVRON CORPORATION, Plaintiff,
v.
STEVEN DONZIGER et al., Defendants.

Randy M. Mastro, Andrea E. Neuman, William E. Thomson, GIBSON, DUNN & CRUTCHER, LLP, Attorneys for Plaintiff

James K. Leader S. Alyssa Young LEADER & BERKON, LLP, Attorneys for Patton Boggs LLP

John W. Keker, Elliot R. Peters, Jan Nielsen Little, Matthew M. Werdegar, KEKER & VAN NEST, LLP, Attorneys for the Donziger Defendants

Julio C. Gomez, GOMEZ LLC, Craig Smyser, Larry R. Veselka, Tyler G. Doyle, SMYSER KAPLAN & VESELKA, L.L.P., Attorney for Defendants Hugo Gerardo Camacho Naranjo and Javier Piaguaje Payaguaje.

MEMORANDUM AND OPINION

LEWIS A. KAPLAN, District Judge.

In June 2012, Chevron Corporation ("Chevron") served a subpoena duces tecum on Patton Boggs LLP ("PB"), which has both sued Chevron on its own behalf in other cases and represented the LAPs in other cases against Chevron, although not as a formal matter before the district court in this case. PB moved to quash the subpoena in its entirety for alleged undue burden and on the ground that it sought only or predominantly documents protected by attorney-client privilege or the work product doctrine. Chevron contended inter alia that any privilege or other protection had been overcome by the crime-fraud exception.

PB's initial motion was denied without prejudice to the privilege and burden claims, thus setting in motion a more informal process that has been described elsewhere and that included individualized consideration of 185 pages of PB objections to the subpoena, further written submissions, and extensive oral argument.[1] That culminated on March 15, 2013, in an extensive opinion in which the Court completed a dramatic narrowing of the PB subpoena and held that Chevron had satisfied the first prong of the crime-fraud exception with respect to a few specific subjects. But the Court did not order production of any PB documents as to which there are any unresolved claims of opinion work product or attorney-client privilege because it remains to be determined whether and to what extent the second prong of the crime-fraud exception - the "in furtherance" requirement - is satisfied.

The LAP Representatives and the Donziger Defendants (collectively, "movants") now move for reconsideration of that ruling. They begin by asserting that "[i]n its rush to render findings that the Court plans to use to attack the recognizability of the Lago Agrio Judgment, the Court has gone outside the record in the relevant briefing."[2] A few lines later, they assert that "the Court adopted as true the bought-and-paid-for declaration of disgraced former Ecuadorian Judge Alberto Guerra..." And they contend that the Court acted prematurely in other respects.

As will appear, their arguments lack merit. At the most basic level, they essentially ignore the fact that the question before the Court was whether there was probable cause to suspect fraudulent or criminal activity - not whether such activity had been proved. They ignore also that it was entirely appropriate for the Court to consider the entire record before it in making that determination. Indeed, they cite no authority to the contrary. At the outset, however, movants' over-the-top rhetoric require that two points be made with crystal clarity.

First, movants' statement that the Court acted as it did "[i]n its rush to render findings that the Court plans to use to attack the recognizability of the Lago Agrio Judgment" is, to say the very least, unprofessional. Counsel should keep in mind their responsibility under Rule 3.3(f)(2) of the Rules of Professional Conduct.[3]

Second, movants' assertion that "the Court adopted as true" the Guerra declaration is entirely false. It is utterly inconsistent with the Court's clear and unmistakable statements in the prior opinion that are directly to the contrary.

That said, this motion is baseless, largely for the reasons stated in plaintiff's opposition.[4] The Court, however, writes briefly to emphasize a few points.

Discussion

Movants make three principal contentions in seeking reconsideration: (1) the Court improperly went "outside the record in the relevant briefing" on this motion; (2) if the Court was going to go beyond the "relevant briefing, " it should have considered and did not "consider all of the record, [5] and (3) the Court erred in its "characterization of the facts."[6] All of these contentions are erroneous.

1. The Court Was Entitled to Consider Any Evidence in the Entire Record

Movants argue that the Court erred in considering evidence "outside the record in the relevant briefing."[7] Specifically, they complain that the Court relied upon evidence in support of Chevron's most recent motion for partial summary judgment, since denied, and its pending motion for sanctions, both of which were filed after the submission of the last briefs on the PB subpoena issue and neither of which had been fully briefed by the time the Court issued the Opinion.[8] This argument is without merit. Indeed, it rests significantly on an incorrect factual premise.

The Court notes at the outset that, notwithstanding movants' arguments about what was and was not considered, this aspect of the present motion for reconsideration is moot. The briefing on Chevron's motion for summary judgment and motion for sanctions is now complete. Indeed, the former motion has been decided. In the interest of utter clarity, the Court will grant the motion for reconsideration as a matter of discretion rather than of right. Upon consideration of everything in the record through May 14, 2013, the Court now reaches exactly the same conclusions it reached in the Opinion. Accordingly, movants' argument about the Court's consideration of the "new evidence, " irrespective of the merit or lack of merit of those arguments, is entirely immaterial. Nonetheless, in the interest of completeness, the Court will address them.

First, the suggestion that the Court was bound to consider only the briefs and exhibits referred to thereon in deciding this motion - and required to ignore all the other evidence in the record - is wrong.

Even in deciding a motion for summary judgment, which can result in a final decision on the merits, a district court is not limited to consideration of evidence specifically brought to its attention by the parties in the briefing on the summary judgment motion. Rule 56(c) and its local counterpart, S.D.N.Y. Civ. R. 56.1, require parties supporting or opposing summary judgment motions to cite to particular materials in the record, and a court may confine its review to those materials.[9] But Rule 56(c)(3) makes clear that while, "[t]he court need consider only the cited materials, ... it may consider other materials in the record." Indeed, the Advisory Committee Note states that this "rule... recognizes that a court may consider record materials not called to its attention by the parties."[10] As a court in deciding a motion for summary judgment may consider record materials not called to its attention by the ...


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