Free Reply to Response to Motion - District Court of Colorado - Colorado

Case 1:01-cv-01451-REB-KLM

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 01-cv-1451-REB-CBS (Consolidated with Civil Action Nos. 01-cv-1472-REB-CBS, 01-cv-1527-REB-CBS, 01cv-1616-REB-CBS, 01-cv-1799-REB-CBS, 01-cv-1930-REB-CBS, 01-cv-2083-REBCBS, 02-cv-0333-REB-CBS, 02-cv-0374-REB-CBS, 02-cv-0507-REB-CBS, 02-cv-0658REB-CBS, 02-cv-755-REB-CBS, 02-cv-798-REB-CBS and 04-cv-0238-REB-CBS) In re QWEST COMMUNICATIONS INTERNATIONAL, INC. SECURITIES LITIGATION LEAD PLAINTIFFS' REPLY IN SUPPORT OF THEIR SECOND MOTION FOR AN ORDER COMPELLING THE PRODUCTION OF DOCUMENTS FROM DEFENDANTS QWEST COMMUNICATIONS INTERNATIONAL, INC., PHILIP F. ANSCHUTZ, CRAIG D. SLATER AND DRAKE S. TEMPEST CONCERNING AN ADVICE OF COUNSEL DEFENSE OR, IN THE ALTERNATIVE, PRECLUDING DEFENDANTS PHILIP F. ANSCHUTZ, CRAIG D. SLATER AND DRAKE S. TEMPEST FROM ASSERTING AN ADVICE OF COUNSEL DEFENSE

Case 1:01-cv-01451-REB-KLM

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Lead Plaintiffs New England Health Care Employees Pension Fund, Clifford Mosher, Tejinder Singh and Sat Pal Singh ("Plaintiffs") respectfully submit the following reply in support of Lead Plaintiffs' Second Motion for an Order Compelling the Production of Documents from Defendants Qwest Communications International, Inc., Philip F. Anschutz, Craig D. Slater and Drake S. Tempest Concerning an Advice of Counsel Defense or, in the Alternative, Precluding Defendants Philip F. Anschutz, Craig D. Slater and Drake S. Tempest from Asserting an Advice of Counsel Defense ("Second Motion"). I. Introduction The parties have thoroughly briefed the issue of whether asserting an advice of counsel defense triggers a waiver of the attorney-client privilege and work-product protection. Indeed, the Court has previously heard oral argument on substantially this and other related issues and has made certain rulings that both parties have objected to and are currently pending before Judge Blackburn. Throughout the discovery dispute, Plaintiffs have steadfastly maintained that by asserting the advice of counsel defense Anschutz, Slater and Tempest (the "Individual Defendants") have waived all attorney-client privilege and work-product protection concerning the subject matter of that advice. Plaintiffs have and continue to assert that this waiver mandates that defendants produce not only documents supporting the defense, but also requires the production of documents which undermine the defense and documents which illustrate whether or not counsel's advice was followed. See Second Motion, Ex. A at 3-6; Ex. B at 6-10. Plaintiffs have also consistently argued that if those relevant documents

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are not produced, then Anschutz, Slater and Tempest should be precluded from asserting the advice of counsel defense. See Second Motion, Ex. A at 7-9.1 In their oppositions, defendants have essentially made the same arguments they raised in their opposition papers to plaintiffs' first motion to compel and have cited to ostensibly the same case law that allegedly supports their position that there is no waiver of the attorney-client privilege or work-product protection under the current situation. The extensive briefing of these issues leaves no doubt that the Court is thoroughly familiar with the factual and legal contentions presented by both parties in this dispute.2 Contrary to the allegations set forth in defendants' oppositions, however, Plaintiffs' instant motion is ripe for decision, is not duplicative of any issue to be decided by Judge Blackburn and is properly before the Court. II. Defendants' Supplemental Rule 26(a)(1) Disclosures Require the Production of Documents Regarding the Subject Matter of the Advice Detailed All defendants in one fashion or another allege that Plaintiffs' instant motion is duplicative of an issue before Judge Blackburn, may be largely mooted if Judge Blackburn affirms this Court's Order requiring defendants to produce all documents provided to the government, and is an unnecessary waste of judicial resources. Qwest's Response to

1

By written Order dated April 19, 2005 the Court denied Plaintiffs' initial motion to compel documents related to the advice of counsel defense. Plaintiffs have objected to this order and this is one issue currently before Judge Blackburn.
2

As previously indicated in their moving papers, Plaintiffs will not specifically address the legal contentions surrounding the advice of counsel defense and any resulting waiver as these issues have been briefed in detail. See Second Motion, Exs. A & B.

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Lead Plaintiffs' Second Motion ("Qwest Response") at 1-3; Opposition of Defendants Philip F. Anschutz and Craig D. Slater to Lead Plaintiffs' Second Motion at 5-7; Defendant Drake Tempest's Opposition to Lead Plaintiffs' Second Motion at 1 n.1. Defendants are flat wrong. This Court expressly authorized the filing of the instant motion if Plaintiffs deemed a motion was necessary after reviewing defendants' supplemental disclosures. See Second Motion, Ex. D at 72:25-73:4. Defendants'

supplemental disclosures have provided Plaintiffs with a more particularized description of their advice of counsel defense rather than the bald assertion defendants previously provided. Therefore, after careful consideration of whether to file this motion, Plaintiffs did so believing that the issue for the Court to decide was manifestly more focused and ripe for consideration ­ now that defendants have identified the documents they may rely on to support the advice of counsel defense, are Plaintiffs entitled to those documents so that they may adequately prepare against this defense at trial.3 This motion seeks nothing more and is sufficiently different from any issue pending before Judge Blackburn given defendants' recent disclosures which have set forth the various documents defendants intend to rely on to support their defenses. In fact, contrary to defendants' allegations, this motion raises an additional issue that is not before Judge Blackburn ­ whether Plaintiffs are entitled to all 89 documents listed by Anschutz and Slater in the chart attached to their supplemental disclosures and whether

3

As previously argued, Plaintiffs believe that they are entitled not only to these documents, but documents which tend to undermine the defense and documents which indicate whether or not defendants followed the advice that was given.

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Plaintiffs are entitled to the documents listed by Tempest in his supplemental disclosures. As admitted by Qwest, only 43 of the 89 documents relied on by Anschutz and Slater to support their advice of counsel defense were previously produced to the government. Qwest Response at 2. Therefore, even if Judge Blackburn were to uphold this Court's May 31, 2005 Order calling for Qwest to produce all privileged documents provided to the government, such a ruling would have no impact on the remaining 46 documents not previously produced to the government and for which a privilege is claimed. Under that scenario, Plaintiffs would ultimately have to file this motion either now or at some later date which may have an impact on their preparation for trial. Additionally, because Tempest allegedly has "no present intent" to support his defense with any privileged documents, Judge Blackburn's decision regarding the Court's May 31, 2005 Order would have no bearing on whether Tempest should produce the documents listed in his supplemental disclosures. If Tempest intends to rely on such documents, the case law mandates that they be produced. Defendants' recent supplemental disclosures have focused the topic areas and supporting documents that defendants intend to rely on for their advice of counsel defense. Whether Plaintiffs are entitled to these specific documents has not been addressed by this Court, nor is this specific issue pending before Judge Blackburn. Therefore, the instant motion is properly before the Court and is ripe for decision. III. Conclusion For the foregoing reasons, Plaintiffs respectfully request that the Court issue an order compelling the production of documents from Qwest and the Individual Defendants -4-

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concerning an advice of counsel defense or, in the alternative, preclude the Individual Defendants from asserting such a defense. DATED: July 25, 2005 Respectfully submitted, LERACH COUGHLIN STOIA GELLER RUDMAN & ROBBINS LLP MICHAEL J. DOWD SPENCER A. BURKHOLZ THOMAS E. EGLER SCOTT H. SAHAM X. JAY ALVAREZ TRIG R. SMITH TED MINAHAN ANDREA N. SALOW

/s/ THOMAS E. EGLER THOMAS E. EGLER 401 B Street, Suite 1600 San Diego, CA 92101 Telephone: 619/231-1058 Lead Counsel for Plaintiffs DYER & SHUMAN, LLP ROBERT J. DYER III KIP B. SHUMAN JEFFREY A. BERENS 801 East 17th Avenue Denver, CO 80218-1417 Telephone: 303/861-3003 Liaison Counsel
S:\CasesSD\Qwest\BRF00022995.doc

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DECLARATION OF SERVICE BY MAIL I, the undersigned, declare: 1. That declarant is and was, at all times herein mentioned, a citizen of the

United States and a resident of the County of San Diego, over the age of 18 years, and not a party to or interested party in the within action; that declarant's business address is 401 B Street, Suite 1600, San Diego, California 92101. 2. That on July 25, 2005, declarant served the LEAD PLAINTIFFS' REPLY IN

SUPPORT OF THEIR SECOND MOTION FOR AN ORDER COMPELLING THE PRODUCTION OF DOCUMENTS FROM DEFENDANTS QWEST COMMUNICATIONS INTERNATIONAL, INC., PHILIP F. ANSCHUTZ, CRAIG D. SLATER AND DRAKE S. TEMPEST CONCERNING AN ADVICE OF COUNSEL by depositing a true copy thereof in a United States mailbox at San Diego, California in a sealed envelope with postage thereon fully prepaid and addressed to the parties listed on the attached Service List. 3. That there is a regular communication by mail between the place of mailing

and the places so addressed. I declare under penalty of perjury that the foregoing is true and correct. Executed this 25th day of July, 2005, at San Diego, California. /s/ KATHLEEN R. JONES KATHLEEN R. JONES

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QWEST (LEAD) Service List - 7/25/2005 Page 1 of 4 Defendant(s) Scott B. Schreiber John A. Freeman Kwame Clement Arnold & Porter 555 Twelfth Street, N.W. Washington, DC 20004 202/942-5000 202/942-5999(Fax)

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Timothy Atkeson Joshua D. Franklin Arnold & Porter LLP 370 Seventeenth Street, Suite 4500 Denver, CO 80202-1370 303/863-1000 303/832-0428(Fax)

Mark T. Drooks Thomas V. Reichert Bird, Marella, Boxer & Wolpert, P.C. 1875 Century Park East, 23rd Floor Los Angeles, CA 90067-2561 310/201-2100 310/201-2110(Fax) David Boies Boies, Schiller & Flexner, LLP 333 Main Street Armonk, NY 10504 914/749-8200 914/749-8300(Fax)

David W. Shapiro John F. Cove, Jr. Boies, Schiller & Flexner, LLP 1999 Harrison Street Oakland, CA 94612 510/874-1005 510/874-1460(Fax) Alfred Levitt Jonathan D. Schiller David Boyd Boies, Schiller & Flexner, LLP 5301 Wisconsin Avenue, N.W., Suite 800 Washington, DC 20015-2015 202/237-2727 202/237-6131(Fax) James E. Nesland Paul Schwartz Jeff Smith Cooley Godward, LLP 380 Interlocken Crescent, Suite 900 Broomfield, CO 80021-8023 720/566-4000 720/566-4099(Fax)

David Meister James Miller David Cook Clifford Chance US LLP 31 West 52nd Street New York, NY 10019 212/878-8000 212/878-8375(Fax)

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QWEST (LEAD) Service List - 7/25/2005 Page 2 of 4

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Holly Stein Sollod Jennifer H. Weddle Holland & Hart 555 Seventeenth Street, Suite 3200 Denver, CO 80202 303/295-8000 303/295-8261(Fax) Mark C. Hansen Rebecca Beynon David Schwarz Kellogg, Huber, Hansen, Todd, Evans & Figel, P.L.L.C. 1615 M Street, N.W., Suite 400 Washington, DC 20036 202/326-7900 202/326-7999(Fax) Barbara Moses Haley Fabricant Morovillo, Abramowitz, Grand, Iason & Silberberg 565 Fifth Avenue New York, NY 10017 212/856-9600 212/856-9494(Fax)

Bruce F. Black Michael J. Hofmann Holme Roberts & Owen LLP 1700 Lincoln Street, Suite 4100 Denver, CO 80203 303/861-7000 303/866-0200(Fax) Walter W. Garnsey, Jr. Kelly Haglund Garnsey & Kahn LLC 1441 Eighteenth Street, Suite 300 Denver, CO 80202-1255 303/296-9412 303/293-8705(Fax)

Eric S. Goldstein Roberta A. Kaplan Marguertie S. Dougherty Paul, Weiss, Rifkind, Wharton & Garrison LLP 1285 Avenue of the Americas New York, NY 10019-6064 212/373-3000 212/757-3990(Fax) Frederick J. Baumann James M. Lyons Rothgerber Johnson & Lyons LLP 1200 17th Street, Suite 3000 Denver, CO 80202-5839 303/623-9000 303/623-9222(Fax)

Robert N. Miller Stephanie E. Dunn Perkins Coie LLP 1899 Wynkoop Street, Suite 700 Denver, CO 80202 303/291-2300 303/291-2400(Fax)

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QWEST (LEAD) Service List - 7/25/2005 Page 3 of 4

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Terence C. Gill Marcy M. Heronimus Sherman & Howard L.L.C. 633 Seventeenth Street, Suite 3000 Denver, CO 80202 303/297-2900 303/298-0940(Fax)

Neil Peck James D. Kilroy Snell & Wilmer, LLP One Tabor Center, SUite 1900 1200 Seventeenth Street Denver, CO 80202 303/634-2000 303/634-2020(Fax)

Charles A. Stillman Diana Nehro Stillman & Friedman, P.C. 425 Park Avenue New York, NY 10022 212/223-0200 212/223-1942(Fax) Plaintiff(s) Robert J. Dyer III Kip B. Shuman Jeffrey A. Berens Dyer & Shuman, LLP 801 East 17th Avenue Denver, CO 80218-1417 303/861-3003 303/830-6920(Fax) William S. Lerach Spencer A. Burkholz Thomas E. Egler Lerach Coughlin Stoia Geller Rudman & Robbins LLP 401 B Street, Suite 1600 San Diego, CA 92101-4297 619/231-1058 619/231-7423(Fax)

Joe R. Whatley, Jr. Whatley Drake, LLC 2323 Second Ave., North Birmingham, AL 35203 205/328-9576 205/328-9669(Fax)

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QWEST (LEAD) Service List - 7/25/2005 Page 4 of 4

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Plaintiff Stichting Pensioenfonds Counsel Jay W. Eisenhofer Geoffrey C. Jarvis Michael J. Barry Grant & Eisenhofer, P.A. 1201 North Market Street, Suite 2100 Wilmington, DE 19801 302/622-7000 302/622-7100(Fax) Clyde A. Faatz Christopher J.W. Forrest Hamilton and Faatz, A P.C. 1600 Broadway, Suite 500 Denver, CO 80202-4905 303/830-0500 303/860-7855(Fax)