How to Get the Most from Rule 502(d): Protecting Privilege in the Production of Documents December 4, 2012 Continuing Education Information We have applied for one hour of California, Minnesota, Texas and Virginia CLE and New York non-transitional CLE credit. Newly admitted New York attorneys may not receive non-transitional CLE credit. For attendees outside of the above states, we will supply a certificate of attendance that may be used to apply for CLE credit in the applicable bar/other accrediting agency. Fulbright will supply a certificate of attendance to all participants that: 1. Participate in the web seminar by phone and via the web. 2. Complete the online evaluation that we will send tomorrow. 2 Administrative Information Today’s program will be conducted in a listen-only mode. To ask an online question at any time throughout the program, simply click on the question mark icon located on the tool bar. We will try to answer your question during the session if time permits. Everything we say today is opinion. We are not dispensing legal advice, and listening does not establish an attorney-client relationship. This discussion is off the record. Anything we say cannot be quoted without our prior express written permission. 3 Brent Lindahl Partner, Minneapolis Fulbright & Jaworski L.L.P. [email protected] +1 612 321 2244 Representation of lenders and insurers in investigations and enforcement actions brought by various state and federal regulators. Defense of lenders and other financial institutions in class actions in state and federal courts around the country. Substantial experience defending clients in matters challenging mortgage lending practices under various state and federal laws, including RESPA, TILA, ECOA, FDCPA, FCRA, and SCRA, as well as state consumer protection, deceptive practice, loan suitability and banking statutes. 4 David Kessler Partner [email protected] +1 212 318 3382 5 Co-head of the Firm's E-Discovery and Information Governance Practice Represented companies in all areas of electronic discovery and information management. Recognized for E-Discovery in Chambers U.S. (2011-2012) and Chambers Global (2012) Adjunct Professor at the University of Pennsylvania Law School and at the Beasley School of Law at Temple University 1997 - J.D., University of Pennsylvania 1994 - B.S., Massachusetts Institute of Technology Emily Johnston Assistant General Counsel; Vice President Bank of America Member of Global Discovery Group, focusing on complex discovery related legal issues in material litigation matters, both domestic and international Has both law firm and in-house experience representing clients on all aspects of both electronic discovery and information lifecycle management Most recently with Fulbright & Jaworski LLP B.A. – Florida State University J.D. – New York University School of Law 6 AGENDA 7 Introduction What are Claw Backs and Quick Peeks? What is FRE 502? How are Parties and Courts Misusing 502(d)? How Can 502(d) Be Used More Effectively? What Can’t 502 (d) Do? Claw Backs and Quick Peeks Claw Backs ● Process For Retrieving Inadvertently Produced Privileged Documents ● Rule 26(b)(5)(B) Quick Peeks ● Production Process ● Inspection with Privilege Log at End NEITHER ADDRESS THE WAIVER OF PRIVILEGE WORLD BEFORE FRE 502 8 RULE 502(b) The following provisions apply, in the circumstances set out, to disclosure of a communication or information covered by the attorney-client privilege or work product protection. b) Inadvertent disclosure. – When made in a federal proceeding or to a federal office or agency, the disclosure does not operate as a waiver in a federal or state proceeding if: 1. the disclosure is inadvertent; 2. the holder of the privilege or protection took reasonable steps to prevent disclosure; and 3. the holder promptly took reasonable steps to rectify the error, including (if applicable) following Fed. R. Civ. P. 26(b)(5)(B). 9 RULE 502(d) & (e) Rule 502. Attorney-Client Privilege and Work Product; Limitations on Waiver d) Controlling effect of a court order. – A federal court may order that the privilege or protection is not waived by disclosure connected with the litigation pending before the court – in which event the disclosure is also not a waiver in any other federal or state proceeding. e) Controlling effect of a party agreement. - An agreement on the effect of disclosure in a federal proceeding is binding only on the parties to the agreement, unless it is incorporated into a court order. 10 Misuse of 502(d) Parties are Not Using It Parties are Re-Memorializing 502(b) Courts are Limiting Its Power: United States v. Sensient Colors, Inc., No. 07-1275 (JHR/JS), 2009 U.S. Dist. LEXIS 81951, at *2 (D.N.J. Sept. 9, 2009) (applying Rule 502(b) despite a general non-waiver agreement, in part, because "[n]owhere in the [agreement] does it mention that the parties are excused f[ro]m the requirements of Federal Rule of Evidence 502(b)"). 11 Case Law Limiting 502(d) U.S. Home Corp. v. Settlers Crossing, LLC, 2012 U.S. Dist. LEXIS 101778 (D. Md. Jul. 23, 2012) Mt. Hawley Ins. Co. v. Felman Prod., Inc., 271 F.R.D. 125, 130, 133 (S.D.W.Va. 2010) Board of Trustees, Sheet Metal Workers’ National Pension Fund v. Palladium Equity Partners, LLC, 722 F. Supp. 2d 845 (E.D.Mich. 2010). 12 How Can It Be Used Better Prevent Disputes Under 502(b) ● Agree to Parameters for Reasonable Review and Rectification ● Agree to No Waiver Under Any Circumstances Reduce the Pain and Cost of Privilege Logs ● More Novel / Aggressive ● No Case Law on Power of 502 on State Courts ● Premise: Many privilege disputes are over documents of marginal relevance ● Under 502(d) agree that a party may produce privileged documents without waiver (Judge Facciola) 13 Rhoads Industry Cites Rhoads Indus. v. Bldg. Materials Corp. of Am., 2008 U.S. Dist. LEXIS 93333 (E.D. Pa., Nov. 14, 2008) (Rhoads I) Rhoads Indus. v. Bldg. Materials Corp. of Am., 2008 U.S. Dist. LEXIS 96404 (E.D. Pa., Nov. 26, 2008) (Rhoads II) 502(d) Example “Pursuant to Federal Rule of Evidence 502(d), the inadvertent production of a privileged or work product protected ESI is not a waiver in the pending case or in any other federal or state proceeding.” Fleming v. Cobra Electronics Corp., 2012 U.S. Dist. LEXIS 163530 (D. Id. Nov. 9, 2012). 15 THE MYTH OF RULE 502 “Defendant estimates that a ‘privilege and relevance’ review by counsel will cost approximately $ 250,000. However, Fed. R. Evidence 502 was recently enacted to reduce the costs of exhaustive privilege reviews of ESI. The parties need to address Rule 502 in any future production and cost discussions.” Spieker v. Quest Cherokee LLC, 2008 WL 4758604 at *4 (D. Kan. Oct. 30, 2008) (emphasis supplied) 16 THE MYTH OF RULE 502 Furthermore, I will enter an order pursuant to Rule 502(d) of the Federal Rules of Evidence that will preclude the disclosure of privileged documents in this case from constituting a waiver of privilege or of work product protection in this or any other proceeding, state or federal. Although Transamerica and SCOR are, of course, free to engage in as exacting a privilege review as they wish, entry of a Rule 502(d) order will give them the option of conducting a more economical analysis while minimizing the risk of waiver. US Bank Nat. Assoc. v. PHL Variable Ins. Co., 2012 U.S. Dist. LEXIS 158448, 12 Civ. 6811 (CM) (JCF) (S.D.N.Y. Nov. 5, 2012) 17 Take Aways Use Quick Peeks Cautiously Use Claw Backs and Rule 502(d) Orders as Insurance Draft 502(d) Orders to Reduce Disputes Claw Backs and Rule 502(d) Do Not Replace Review Rule 502(d) Does Not Excuse the Production of Other Information 18 JOIN US NEXT MONTH! Visit www.fulbright.com/fulbrightforum to view and register for our upcoming web seminars. Join us on Tuesday, January 8, 2012 19 AUSTIN • BEIJING • DALLAS • DENVER • DUBAI • HONG KONG • HOUSTON • LONDON • LOS ANGELES • MINNEAPOLIS MUNICH • NEW YORK • PITTSBURGH-SOUTHPOINT• RIYADH • SAN ANTONIO • ST. LOUIS • WASHINGTON, D.C.
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