Kansas City Power & Light Co. v. Pittsburg & Midway Coal Mining Co.

133 F.R.D. 171, 1989 U.S. Dist. LEXIS 17302, 1989 WL 230167
District Court, D. Kansas·Decided December 1, 1989·No. Civ. A. No. 88-2224-S·Published·Cited by 17 cases

Opinion

.MEMORANDUM AND ORDER

GERALD L. RUSHFELT, United States Magistrate.

Under consideration is plaintiffs’ Motion for Protective Order (doc. 86) and plaintiffs’ Amended Motion for Protective Order (doe. 106). Both motions seek an order compelling defendant to return documents clothed with the attorney-client privilege, inadvertently produced by plaintiff KCP & [172]*172L during discovery. They further seek an order that would preclude Pittsburg & Midway Coal Mining Company (hereinafter P & M) and its counsel from use of or reference to the privileged documents. The court deems the initial motion superceded by the amended motion.

The court utilizes the following five factors to determine if inadvertent disclosure of documents effects a waiver of the attorney client privilege:

1. The reasonableness of the precautions to prevent inadvertent disclosure;
2. The time taken to rectify the error;
3. The scope of discovery;
4. The extent of disclosure; and
5. The overriding issue of fairness.

Hartford Fire Insurance Co. v. Garvey, 109 F.R.D. 323 (N.D.Cal.1985).

With respect to the first factor, KCP & L claims its counsel diligently attempted to review each document and to identify and hold those protected under the attorney-client privilege. They withheld documents they considered to be privileged and listed them on an index. This index included all three documents at issue. Plaintiffs provided the list to defendant P & M. They intended for it thereby to identify documents which KCP & L did not intend to produce. Plaintiff KCP & L inadvertently produced copies of the three privileged documents from a different file. Originals remain in KCP & L’s files.

The court finds KCP & L’s procedures were adequate. It screened the documents. It determined they were privileged. It maintained the originals in its files. It is not clear how the copies were inadvertently produced, but the procedures employed to prevent disclosure appear adequate, given the scope of discovery in this case. P & M suggests a second screening would have prevented the disclosure. Through hindsight one may conceive of further precautions that might have prevented an inadvertent disclosure. Under the circumstances in this case the precautions were reasonable.

The second factor concerns the time taken to rectify the error. Here fourteen months elapsed after defendant initially received the documents until plaintiffs moved for a Protective Order (doc. 86). KCP & L however, contends it acted within two weeks of discovering the inadvertent production. In the court’s view the relevant time should begin when plaintiff discovered or with reasonable diligence should have discovered the inadvertent disclosure. Plaintiff KCP & L could not have taken action to rectify the error until it learned of it. It thereafter sought to rectify the error within a reasonable amount of time. This factor weighs in favor of finding the privilege was not waived.

The third factor, scope of discovery, also weighs against a finding of waiver in this case. Plaintiff estimates 500,000 pages of documents have been produced and over 200,000 documents copied. Defendants have not disputed this estimate. As the court explained in In re Wyoming Tight Sands Antitrust Cases, No. 85-2349-S, unpublished (D.Kan. September 11, 1987):

Where document production is extensive ... a finding that an inadvertent disclosure of privileged documents waives the attorney-client privilege or work-product protection does not advance the aim of full and free discovery. Parties might tend to produce fewer documents or delay production for fear of losing protection for otherwise valid, privilege claims.

Id. at p. 11. Citing New York State Energy Research and Development Authority v. Nuclear Fuel Services, Inc., 36 Fed.R.Serv.2d 1511, 1519 (W.D.N.Y.1983).

The fourth factor, extent of disclosure, affords some bases to support the positions of both plaintiff and defendant. The memoranda of defendant P & M suggests its counsel have extensively used the three documents, particularly discovery depositions, and in preparing Count III of the amended counterclaim. On the other hand, the record does not confirm that the documents were so extensively used as defendant argues. The abstracts of deposition testimony, attached as exhibits to the memoranda, indicate only one document specifically identified during the deposition of Ronald Wasson. (Reply Exhibit 3, doc. [173]*173105.) Counsel for plaintiff objected to it. The testimony of the witness thereafter relates more to foundational and incidental details, rather than the substantive content of the document. Notwithstanding the assertions by defendant that it used the three privileged documents in preparing an amended counterclaim, moreover, the court finds nothing to confirm they were crucial to such preparation. The amended counterclaim itself does not refer to them. The motion for leave to file the amended counterclaim does not refer to them. The memoranda of defendant indicates the documents are supportive of Count III, rather than critical to it. In reviewing the three documents, the court does not find their content to be so obviously damning as defendant contends. Accordingly, the court finds little persuasion in the mere conclusion that these three documents have been extensively used since their inadvertent production. Undoubtedly counsel have intensively reviewed them. The court, however, does not consider intensive review to mean the same as extensive disclosure. On balance it finds the factor of extent of disclosure weighs in favor of plaintiff.

The fifth factor is the overriding issue of fairness. Plaintiff claims that fairness dictates a finding of waiver because the documents support its amended complaint. The three documents are memoranda written by Mark English, its in-house counsel. He sent them to KCP & L’s Vice-President of Administrative Services. They bear the following dates: December 18, 1987; December 22, 1987; and January 8, 1987 (Documents attached as Exhibits 1 and 3 in Doc. 87 and sealed in Doc. 99). All three memos discuss KCP & L’s obligations under the P & M contract. The first memo allegedly refutes plaintiff’s allegations that they were unaware until the summer of 1987 of Kansas sulfur emissions limitations which applied to their LaCygne plant. They also allegedly contradict plaintiff’s allegations that it cannot burn P & M coal and meet sulfur dioxide emissions standards.

The third memo allegedly supports P & M’s Count II by establishing the following:

1. Plaintiff should have been aware their purported exculpatory grounds for avoiding the P & M agreement is merit-less.
2. The risk of change in the sulfur dioxide emission limitations and the promulgation of continuous emission monitoring standards was a foreseeable risk to plaintiffs.
3. Even if the force majeure clause in P & M’s contract is applicable to these events, it was and is possible for plaintiffs to overcome the alleged force majeure.
4. The magnitude of the cost of the force majeure is a relevant consideration. Only with respect to the commercial impracticability defense in K.S.A.

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Kansas City Power & Light Co. v. Pittsburg & Midway Coal Mining Co., 133 F.R.D. 171, 1989 U.S. Dist. LEXIS 17302, 1989 WL 230167 (D. Kan. 1989).

133 F.R.D. 171 (Kansas City Power & Light Co. v. Pittsburg & Midway Coal Mining Co.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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