Wal-Mart Stores, Inc. v. Indiana Electrical Workers Pension Trust Fund IBEW
2014 Del. LEXIS 336
| Del. | 2014Background
- This is a Delaware Court of Chancery Section 220 books-and-records case arising from Wal-Mart’s response to IBEW’s demand concerning WalMex bribery allegations.
- IBEW sought broad categories of documents related to the 2002–2005 WalMex scheme and the handling of that investigation to assess demand futility and internal controls.
- Wal-Mart produced over 3,000 documents with heavy redactions and later provided more under a court-ordered framework.
- The Court of Chancery issued a final order expanding production to officer-level materials, a seven-year window, disaster-recovery data, and materials “known to exist” in the Office of the General Counsel, among other items.
- Wal-Mart and IBEW appealed; the court’s decision affirmed, allowing expanded production and the Garner doctrine-based disclosure of certain privileged materials.
- Wal-Mart’s cross-appeal also challenged the handling of Whistleblower Documents and related privilege issues.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Scope of officer-level documents | IBEW argues officer-level docs are essential to determine awareness and control | Wal-Mart contends officer docs exceed necessary scope | Yes, officer-level docs are necessary and essential |
| Date range for production | Broader dates needed to capture changes post-WalMex investigation | Limiting to a narrow period would suffice | Court properly set a broader, contextual date range |
| Disaster recovery tapes | Need backup data to locate responsive documents | Only some custodians’ backups are required | Court properly ordered search or explanation of infeasibility for two custodians |
| Garner doctrine in Section 220 | Garner applies to compel production of privileged material | Garner not clearly adopted for Section 220 in Delaware | Garner is applicable in Section 220; necessary-and-essential inquiry precedes privilege analysis |
Key Cases Cited
- Saito v. McKesson HBOC, Inc., 806 A.2d 113 (Del. 2002) (overlaps between necessary/essential and privilege work product analysis)
- Espinoza v. Hewlett-Packard Co., 32 A.3d 365 (Del. 2011) (essentiality first; then privilege/work-product consideration)
- Grimes v. DSC Communications Corp., 724 A.2d 561 (Del. Ch. 1998) (Garner factors applied to grant discovery in Section 220)
- Zirn v. VLI Corp., 621 A.2d 773 (Del. 1993) (Garner factors for privilege in Delaware)
- Garner v. Wolfinbarger, 430 F.2d 1093 (5th Cir. 1970) (fiduciary exception to attorney-client privilege; good cause)