TRIPLE a MACHINE SHOP, INC v. State of California

213 Cal. App. 3d 131, 261 Cal. Rptr. 493, 1989 Cal. App. LEXIS 842
CourtCalifornia Court of Appeal
DecidedAugust 16, 1989
DocketA042955
StatusPublished
Cited by40 cases

This text of 213 Cal. App. 3d 131 (TRIPLE a MACHINE SHOP, INC v. State of California) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
TRIPLE a MACHINE SHOP, INC v. State of California, 213 Cal. App. 3d 131, 261 Cal. Rptr. 493, 1989 Cal. App. LEXIS 842 (Cal. Ct. App. 1989).

Opinion

Opinion

HANING, J.

The State of California et al. 1 appeal a preliminary injunction prohibiting them from contacting all present and certain former employees of respondent Triple A Machine Shop, Inc., in connection with civil and criminal proceedings appellants are prosecuting against respondent for alleged unlawful disposal of hazardous wastes. We previously granted supersedeas, and now reverse, concluding that neither the Rules of Professional Conduct nor the attorney-client privilege supports the injunction.

Facts

In 1976 respondent leased space from the United States Navy at Hunter’s Point Naval Shipyard in San Francisco. In the spring of 1986 naval personnel witnessed activities by respondent believed to violate California law governing storage and disposal of hazardous wastes, including dumping oily waste, chemical liquids and polychlorinated biphenyls (PCB) on the ground, creating hazardous waste ponds, disposing of sandblasting grit (often containing lead, copper, zinc and arsenic) and improper storage of asbestos.

On July 17, 1986, in response to a complaint from the Navy alleging illegal dumping of hazardous waste, James McCammon, a hazardous materials specialist from the State Department of Health Services (DHS), accompanied by Navy Lieutenant Leroy and respondent’s assistant facilities manager, Fred Stivender, inspected respondent’s facility and took samples which revealed asbestos and PCB’s. McCammon returned to the facility the following day to observe respondent’s operations. Among those present were James Jaífe, respondent’s attorney, Stivender, and Albert O. Engel, respondent’s president. McCammon observed numerous violations of California’s hazardous substance laws.

*136 In September 1986 McCammon and two associates returned to respondent’s facility to conduct a generator inspection. After Stivender told them he knew where all the wastes were dumped and who dumped them, they were refused access to the facility by respondent’s attorney. Thereafter, DHS requested the assistance of the San Francisco District Attorney to obtain an inspection warrant.

In November 1986 the district attorney obtained a search warrant. In the supporting affidavit, an investigator for the district attorney set forth her communications with McCammon in which he described his aforementioned inspection of the facility and contacts with respondent’s personnel. The investigator also described a conversation with Eric Smethurst, respondent’s former director of security, in which Smethurst stated he was aware of open trench disposal of oily wastes and dumping of sandblasting wastes.

On June 11, 1987, while the criminal investigation was proceeding, the district attorney brought a civil action to enjoin respondent from dissipating its assets so they would be available to pay penalties and clean-up costs pursuant to any subsequent judgment. In connection therewith, William Hord, former shop superintendent for respondent and former Captain of the Hunters Point Fire Department, signed a declaration describing the handling and disposal of hazardous wastes. A preliminary injunction issued restraining respondent from dissipating its assets. Subsequently, the trial court ordered the civil action stayed pending completion of the criminal investigation.

In March 1988 respondent filed the instant action for injunctive relief alleging, inter alia, that appellants contacted its high level managerial employees without its notice or consent, in violation of the attorney-client privilege (Evid. Code, § 950 et. seq.), the attorney work product privilege (Code Civ. Proc., § 2018) and former rule 7-103 of the California Rules of Professional Conduct. 2 In support of its application respondent submitted declarations by James L. Jaffe, its attorney, and Albert O. Engel, its president. Jaffe declared that since at least July 1986 appellants knew he represented respondent in connection with the illegal hazardous waste storage and disposal matters. He also declared that appellants interviewed Stivender and Smethurst in preparation of the search warrant affidavit, and interviewed Hord pursuant to their civil action, without notice to Jaffe or *137 respondent. However, Jaffe was unaware of “the exact nature of the information conveyed to [appellants] by past and present employees of [respondent],” and stated that discovery would be necessary to determine whether any privileged information had been conveyed. Engel declared that respondent’s management had never given permission to its employees, officers or directors to discuss any matter with appellants.

In May 1988 the trial court issued a preliminary injunction enjoining appellants “from contacting any present employee of [respondent], or former employee of [respondent] who is a member of [respondent’s] corporate control group, except for the purpose of service of a subpoena, concerning any matter which is directly or indirectly relevant to the facts as alleged in [appellants’ civil action or respondent’s civil action] without first giving [respondent’s] counsel 72 hours notice prior to said contact.” In support of appellants’ motion for reconsideration or modification of the injunction, Assistant District Attorney Steven Castleman stated that following the hearing on the injunction, one of respondent’s attorney’s, Fred M. Blum, told him that neither Smethurst nor Hord w^re members of respondent’s corporate control group, He further declared that the stated position of respondent was that membership of the corporate control group is privileged information, and protected by the right against self-incrimination. 3 Castleman’s declaration further stated that Blum told him respondent had not authorized him to provide appellants with a list of respondent’s current employees. Blum’s declaration in opposition to the motion for reconsideration stated that “[Respondent’s] counsel has at all times informed [appellants] that if [appellants] want to know if a specific individual that they wish to contact is an employee or control group member that said information will be conveyed. All that is necessary is for defendants to call and ask 72 hours prior to the contact.”

At the hearing on the motion for reconsideration Castleman stated that the injunction was problematic since appellants were unable to identify the members of the corporate control group. In denying reconsideration, the trial court responded: “You have a choice. If you are sure they are not, you can interview them. If you are wrong, you get sanctioned. Or you can call them up and ask him, and hassle it out.”

On or about February 8, 1989, a criminal complaint was filed charging respondent and an individual corporate officer with 16 counts of violation of *138 Health and Safety Code section 25189.5 (unlawful disposal of hazardous wastes).

Discussion

I

Although prosecution of the civil action has been stayed pending the criminal case, the injunction clearly affects the district attorney’s investigatory process in both actions, since both actions arise out of the same conduct.

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Bluebook (online)
213 Cal. App. 3d 131, 261 Cal. Rptr. 493, 1989 Cal. App. LEXIS 842, Counsel Stack Legal Research, https://law.counselstack.com/opinion/triple-a-machine-shop-inc-v-state-of-california-calctapp-1989.