Free Memorandum in Opposition to Motion - District Court of Connecticut - Connecticut

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_ .. Case‘l3:O3-cv-QO369;DJS Document 29;5 Fnled O1/30/2004 Pagel of 4_ ---
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(Cite ss: 2I]03W’L22990099 (S.D.N.Y.)) _ ‘ - --
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Only the Westlaw citation is currently available.
g i " _ United States District Court,
S.D. New York.
LYDNDELL—CITGO REFINING, LP, plaintiff, `
V-- . .
PETROLEOS DE VENEZUELA, S.A. and PDVSA—Petroleo, S.AQ, Defendants. `
I I No. 02 Civ. 0795(CBM).
- Dec. ls, 2003. I
MEMORANDUM OPINION AND ORDER
MOTLEY, J. ` , i
*1 Defendants Petroleos de Venezuela, SpA. ("PDVEA"} and PDVSA-Petroleo, s,A.
("Petro1eo") have moved, pursuant to "`Federal Rule of Civil arseeanee zap;) ana .
under the provisions_of an order of this court dated October 30, 2003, for a _
protective order barring ex parte contact between plaintiff and certain current and
former employees of defendants, on the ground that they were likely exposed to `
privileged, confidential or business proprietary information or trade secrets.
Plaintiff opposes defendants* motion only as regards former'non—legal.employees of
defendants. With respect to these individuals, defendants‘ motion is denied.
I. THE PARTIES
Plaintiff is a limited partnership with its principal place of business in
Houston, Texas, where it owns a crude oil refinery. Defendant sDvsA·is the national
oil company of Venezuela, and defendant Petroleo is a wholly owned subsidiary of
~· PDVSA.
II. PRIOR. snocstbrlvds _ M -
This action was initiated by the filing of a civil suit on February i, 2002. The
complaint alleges that defendants breached contracts to supply heavy crude oil to
plaintiff, and that the declaration of force majeure used by defendants as a
justification for their reduction of supply was in fact designed to force plaintiff
(and others) to buy Venezuelan crude oil on the spot market at higher prices.
Plaintiff seeks damages, specific performance of the contracts, and declaratory
‘· judgment that, inter alia, the`declaration of force majeure was invalid; .
- - In an order dated October 30, 2003, the court resolved,a`dispute raised by the
_ parties in their._2S(f) Report, and detailed in letters to the court. In response to
_ defendantsf concerns regarding ex_parte contacts with farmer employees, theycourt
ordered the following procedure: -
` A. Ex parte communications with former employees who may have privileged.
confidential or business proprietary information or trade secrets may be x
prohibited on a case-by-case basis by either stipulation or court order. .
. H. Notice of ten (1D)*business days is to be provided by‘a party of any proposed.
contact with respect to this litigation with any former employee of an opposing
party, its subsidiaries or predecessors. -
C. If a timely objection is filed upon such notice, no ex parte contact shall be
' made until.the`issue is resolved by stipulation or court order.
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D. When initiating ex parte communications with any former employee not covered
above, the parties agree that respective counsel will (i) identify themselves,
their employers and their clients; (2} the nature of and parties to the pending ‘
action and its adversarial,nature; (3) isrsxm the potential interviewee that he or
she need not speak to the interviewer, that he or she may want an attorney, and
that if, during his or her employment with either of the parties, he or she ever F
engaged in discussion with counsel for the parties regarding this lawsuit.or the
circumstances from which it arose, he or she should not reveal such communications
to the interviewer. _ `
, _ *2 sn Nvvember 25, 2003, the court received a stipulation and protective order for
the production and exchange of confidential information, signed by the parties,
· which governs the handling of discovery material "produced, given or exchanged hy,
._ among, or between the Parties and/or any non-parties," and includes the.provision
that "All Discovery Material ... and any documents or information derived
therefrom, shall be used solely for the purpose of the Litigation and may net be
used for any other purpose whatsoever, including, but not limited to, any business
or commercial purpose or for dissemination to the media or public."
Pursuant to the court*s order of October 30, 2003, plaintiff informed defendants
on November S, 2003, of the names of forty-four individuals whom plaintiff wished `_
to contact, . ·
on November 19, 2003, defendants made a motion, and on November 26, 2003, a
supplemental motion, for a protective order barring ex parte contact between
plaintiff and a total of thirty-six of the forty-four named employees, because of
the "strong likelihood that they had extensive exposure to privileged, confidential
_ or business proprietary information, or trade secrets." ThE total number of
individuals for whom defendants seek a prohibition on ex parte communications, in
their motions, their reply, FN1 and a letter to plaintiff dated December l7,
2003,_iE§3L is thirty-nine. Of these, however, nine have been identified by
defendants as current employees of defendants, FN3 and one has been identified
by defendants as a former legal counsel to defendants. FN4 Since plaintiff has M
_ stipulated that it will not contact any of those persons identified by defendants
as current employees or former legal counsel, we need not consider those ten
individuals in this opinion. We also decline to consider the appropriateness of a
ban on ex parte contacts with Mike Quintero, since defendants first raised his name
in their reply papers, thus depriving plaintiff of the opportunity to object. of
the twenty-eight individuals remaining under consideration, five are former i
P presidents of PDVSA, and the remainder are "other former employees" of defendants.
· FN1. The reply adds two further names to the list of individuals with whom
_ defendants seek to prohibit ex parte communications. The two individuals
added are·A1exander·Cardenas·and Mike Quintero. `
FN2. The letter, which adds a further name to the list of those with whom _ -
-’ defendants seek to prohibit ex parte communications, reads,as follows: "We
y - ~have recently been informed by our client, Defendant Petroleos de Venezuela,
x 5.A. ("PDVSA"), that Jose Gregorio Morales_is currently employed by PDVSA. -
, You had previously indicated your client's desire to contact Mr. Morales ex`
parte pursuant to- the provisions set forth in the Cc>1.1rt's Order of October
, - _ 30, 2003. In light of this new information, Mr[·Morales should not be
- __` contacted ex parte because he is a current employee of Defendant."
FNB, These are Julian Fleszczynski, Rafael Guilliod, Nelson Martinez, Alfredo
* Pineda, Felix M. Rodriguez, Dester Rodrigues, Luis Vierma, Alexander,
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Cardenas, and Jcsé Gregcric Merales.
FN4. This is Jcse Mcrend (fcrmer Legal Ccunsel, PDVSA).
III. DISCUSSION `
Under the Federal Rules, a party seeking the irsuance gf a prgteqtive srder
felatlns ta disccvery must shew gccd cause that such an crder is needed tc prctect
it frcm anncyance, embarrassment, cppressicn, cr undue burden cr expense. See
Fed.R.Civ.P. 26§c). We find that defendants have failed tc dc sc.
The law is clear in the Seccnd Circuit that "a perscn claiming the attcrney—
client privilege has the burden cf establishing all the essential elements
therecf." ven Bulcw v. vcn Bulcw, Sll F.2d 135 146 [ad Cir,l9B7). The privilege
arises under the fcllcwing circumstances; "(l) where legal advice cf any kind is
scught‘{2) frcm a prcfessicnal legal adviscr in his capacity as such, (3) the
tanmnnlaatiana felatins ta that pnrpeae. (4) made in ccntidsncc (5) by the client,
(6) are at his instance permanently pretested (7) frcm disclcsure by himself cr by
the legal adviser, (S) except the prctecticn be waived ...” Unitsg §tates.v. Kcvel,
296 F.2d 919, 921 (Sd Cir.1g§l), gucted in United Statgs v. Rein, 72S F.2d 1D7, 1121
glass). The burden cf establishing these elements is nct discharged by "mere
` ccncluscry cr ipse dinit asserticns." In re Bcnannc,~3&4 F.2d`S30, BBB {sd
‘ Cir.l9G5), qucted in ven Bulcw, S11 F.2d at 1dE. _ .
*3 A party seeking a prctective crder precluding disclcsure ef certain
ccmmunicaticns with a fcrmer emplcyee cn grcunds cf attcrney-client privilege has
been fcnnd tc have failed tc carry its burden when it fails tc identify any
privileged infcrmaticn tc which the fdrmer emplcyee was privy. See Stratagem Dev.
Ccgp. v. ggren Int’l N.V., 1992 WL 2[6E%4 at *9 §S.D.N.Y.lB92]; see alsc Pclgcast
. Tech. Ccrp. v. Unireyal, IMG.: 129 F.R.D. 621, EQ9 [S.D.N . Y.l990§ (ncting that if
H the party seeking a bar cn ex parte ccmmunicaticns with a farmer emplcyee were tc
"ccme fcrward with evidence that privileged ccmmunicaticns might be in jecpardy, a
narrcwly-tailcred crder might be apprdpriate," but denying the mcticn fcr a ,
prctective erder, since the party had "failed tc identify any specific privileged
i infcrmaticn tc which [the fcrmer emplcyee] was privy”).
` Defendants seek this prctective crder cn the grcunds that the individuals in
questicn are likely tc have been expdsed tc privileged cr ccnfidential infcrmaticn,
cr tc have been privy tc business prcprietary infcrmaticn and/cr trade secrets.
Hcwever, we find that the circumstances et this case dc nct warrant the impcsiticn
. cf a bar cn ex parte ccmmunicaticns. As regards·privileged material, we find that
defendants' interests will be sufficiently prctected by twc stipulaticns made by
plaintiff. in its respcnse tc de£endants' metien. First, plaintiff`has stipulated
that all interviews will be ccnducted by attcrneys, thus avciding the hazard ncted _
in G-I Heldings,`where "[t]he danger cf inadvertent disclesnre is ccmpcunded by the
fact that the investigatcrs are themselves lay perscns and, thus, are in little
better pcsiticn than the interviewees tc assess whether privileged material is
being disclcsed." G-I Hcldings, Inc. v. Barcn e Budd, 199 F;R.D; ESQ, 535
t§S.D.N.Y.2001;L Seccnd, plaintiff has stipulated that the guesticns will be
targeted sc as tc avcid any discussicn cf privileged infcrmaticn. As regards ·
ccnfidential material, prcprietary infcrmaticn and trade secrets, we agree with
iplaintiff that defendants' interests will be sufficiently prctected by the
ccnfidentiality agreement signediby the parties subsequent tc this ccurt*s crder cf
· ` Dctcber 30, Q003, regarding ex parts ccntacts. . ` (· `
IV. CONCLUSION `
` Fcr the reascns` stated abcve, defendants• mcticn is denied, and plaintiff may - `
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pfcceed tc ccntact. the f¤1··mex:.emplcyees at issue, Ap, qxdgy tg thi; gffgqq; will bg
filed ccncurremtly with this Memnxamqmm cpiniqn and Q;|;·dg;·_
SO ORDERED. _ -
2003 WL 22990099 (E.1:>.1·1.Y. ) l - .
END OF DOCUZIVIENT l `
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