Morris v. Scenera Research, LLC, 2011 NCBC 33

Background

Morris filed a state-court action (later remanded from federal court) seeking wage and contract claims against Scenera Research, Fry, and related entities.
The case was designated a mandatory complex business case and remanded after a federal action for declaratory relief was dismissed for lack of complete diversity.
Morris moved to compel discovery (privilege issues and document production issues) after substantial document review and rolling production by Scenera (tens of thousands of pages produced).
Scenera produced about 22,000 documents (roughly 350,000+ pages) and later an additional ~50,000 pages; production included a privilege log and in-camera review of select items.
Key privilege issues involve Tytran (in-house counsel) communications, Ramos (former employee) communications, Brannian (outside counsel) communications, and a claw-back provision from the Joint Rule 26(f) Report.
Rule 34(b)(2)(E) dispute centers on whether Scenera’s production was kept in the usual course of business and/or organized to match document requests.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Are Tytran communications privileged?	Morris contends Tytran communications are not all privileged (mostly factual) and should be produced.	Scenera argues Tytran communications are privileged as attorney-client communications in providing legal advice.	Tytran documents reviewed in camera are privileged attorney-client communications.
Are Tytran–Ramos communications privileged and/or within common-interest scope?	Morris questions privilege applicability for Tytran–Ramos exchanges, including common-interest analysis.	Scenera asserts common-interest and post-employment continuation extend privilege; Upjohn framework applies to form/facts gathering.	Tytran–Ramos communications are privileged; common-interest issues reserved for in-camera review; no waiver found at this stage.
Did Scenera’s Brannian production waive the attorney-client privilege?	Morris argues inadvertent disclosure of Brannian documents waives privilege.	Scenera relies on claw-back provisions and inadvertent-disclosure defenses under Rule 26(b)(5)(B) and FRE 502.	Brannian production was inadvertent, claw-back provision binding; no waiver of privilege.
Has any subject-matter waiver occurred due to Brannian disclosures?	Morris asserts Brannian disclosures could waive privilege on related employment agreements.	Waiver does not extend to subject matter absent intentional disclosure; inadvertent disclosure does not create subject-matter waiver.	No subject-matter waiver; inadvertent disclosure does not waive privilege.
Does the logging requirement extend to carbon-copied communications to outside counsel?	Morris contends such carbon-copied items must be logged and reviewed for privilege.	Parties agreed not to log correspondence between parties and outside counsel; logging scope should follow agreement.	Document carbon-copied communications are subject to the agreement; logging not required unless privileged; review to continue.
Was Scenera’s document production properly organized under Rule 34(b)(2)(E) or kept in the usual course of business?	Morris argues lack of organization to match requests; seeks labeling/organization per requests.	Scenera produced in the usual course of business and in searchable form per Joint Rule 26(f); parties can modify form/organization by agreement.	Agreement to treat production as more than form; court to assess whether further organization is feasible; supplemental report ordered.

Key Cases Cited

State v. Murvin, 304 N.C. 523 (1981) (attorney-client privilege elements and burden on the proponent)
In re Miller, 357 N.C. 316 (2003) (five-element test for privilege applicability and in-camera review authority)
Upjohn Co. v. United States, 449 U.S. 383 (1981) (upholds privilege to aid legal advice including information gathering)
In re Allen, 106 F.3d 582 (4th Cir. 1997) (application of Upjohn to former employees)