PROCEEDINGS: ORDER GRANTING PLAINTIFF’S MOTION TO COMPEL SUPPLEMENTAL RESPONSES TO ITS FIRST SET OF REQUESTS PROPOUNDED ON MAYNARD HAL GARBER AND FOR AN AWARD OF ATTORNEY’S FEES
On January 23, 2006, plaintiff filed a motion to compel supplemental responses to its first set of requests propounded on Maynard Hal Garber and for an award of attorney’s fees of not less than $15,000.00, a joint stipulation in support of the motion, and the declaration of Evan W. Granowitz, with exhibits. On February 1, 2006, plaintiff filed a supplemental memorandum of law and the supplemental declaration of Evan W. Granowitz, with exhibits, and on February 7, 2006, plaintiff filed a second supplemental declaration of Evan W. Granowitz, with exhibits.
Oral argument was held before Magistrate Judge Rosalyn M. Chapman on February 15, 2006. Ronald S. Hodges, Gary A. Pember-ton and Evan W. Granowitz, attorneys-at-law with the firm Shulman Hodges & Bastían, appeared on behalf of plaintiff and Thomas J. Weiss and Hyrum K. Hunt, attorneys-at-law, and James D. Henderson, Jr., attorney-at-law, appeared on behalf of Garber defendants.
The nature of this litigation is detailed in the Order denying Garber defendants’ motion for security costs issued contemporaneously with this Order, and need not be repeated here.
DISCUSSION
I
Rule 26(b)(1) permits discovery in civil actions of “any matter, not privileged, that is relevant to the claim or defense of any party. ...” Fed.R.Civ.P. 26(b)(1). “ ‘Generally, the purpose of discovery is to remove surprise from trial preparation so the parties can obtain evidence necessary to evaluate and resolve their dispute.’” Moon v. SCP Pool Corp.,
Rule 34 is one of the discovery tools available to litigants in the federal courts. Keith H. v. Long Beach Unified, School Dist.,
Here, plaintiffs motion to compel seeks supplemental responses to plaintiffs first set of requests for production of documents, requests nos. 1-194 (except request no. 188), addressed to defendant Maynard Hal Gar-ber. Defendant Garber made boilerplate objections to almost every single request for production, including broad relevancy objections, objections of “overly burdensome and harassing,” “assumes facts not in evidence,” privacy, and attorney-client privilege/work product protection.
As an initial matter, general or boilerplate objections such as “overly burdensome and harassing” are improper — especially when a party fails to submit any evidentiary declarations supporting such objections. Paulsen v. Case Corp.,
The Court, rather than discussing separately each document request and defendant Garber’s objections, prefers to address several broad issues raised by plaintiff in its motion and the joint stipulation:
(1) whether defendant Garber has conducted a reasonable search to discover all documents in his possession, custody or control, and has produced all responsive documents;
(2) whether defendant Garber has obtained documents from certain nonparties, including communications companies Nextel and Pacific Bell, financial institutions Elka Bank, Bank Hapoalim, Financorp and First Bank of Omaha, and governmental entities Internal Revenue Service and the California Franchise Tax Board, or should be required to consent to the release of his records from such nonparties and other nonparties that might have responsive documents;
(3) whether defendant Garber’s privacy claims of attorney-client privilege/work product protection and right to privacy apply to his financial documents;
(4) whether the crime-fraud exception applies to defendant Garber’s claim of attorney-client privilege regarding all communications between him and co-defendant Ricardo Rojas;
(5) whether defendant Garber has waived all claims of privilege by failing to timely provide a privilege log or detailed information to evaluate his privilege claims;
(6) whether defendant Garber has failed to preserve evidence and destroyed evidence that would be responsive to some of the production requests; and
(7) whether plaintiff is entitled to attorney’s fees in an amount not less than $15,000.00.
1 & 2. Search for documents:
Under Rule 34, a party must produce or permit inspection of documents responsive to a request for production of documents when such documents are in the party’s “possession, custody or control.” “[Fjederal courts have consistently held that documents are deemed to be within [a party’s] ‘possession, custody or control’ for purposes of Rule 34 if the party has actual possession, custody, or control, or has the legal right to obtain the documents on demand.” In re Bankers Trust Co.,
Here, defendant Garber, in response to plaintiffs numerous requests for production of documents, has produced approximately 666 pages of documents to plaintiff. Declaration of Evan W. Granowitz, 115. The paucity of defendant Garber’s response to almost 200 document requests is astounding! Moreover, defendant Garber has produced none of his records from the several telecommunications companies, financial institutions, and governmental entities with which he, his various business enterprises, and his counsel have dealings. In light of the nature of plaintiffs claims, and the paltry number of documents defendant Garber has produced to plaintiff, it is clear that defendant Garber has not conducted a reasonable inquiry into the factual basis of his responses to plaintiffs requests and has not produced to plaintiff all documents in his “possession, custody or control.”
Moreover, if defendant Garber fails to make a “reasonable inquiry” to locate responsive documents, or fails to provide plaintiff with the necessary declarations or affidavits evidencing this “reasonable inquiry,” the Court will order defendant Garber, at a minimum, to sign consents to release his documents from various nonparties so plaintiff can expeditiously obtain those documents. See, e.g., Rodriguez v. IBP, Inc.,
3, 4 & 5. Privileges:
Questions of evidentiary privilege arising in the course of the adjudication of federal rights are governed by the principles of federal common law. United States v. Zolin,
A. Privacy:
Defendant Garber raises privacy objections to document request nos. 86, 95, 106, 110-11, 113, 153-60, and 191, which seek documents — primarily bank records — regarding financial transactions and data involving defendant Garber and/or related entities.
Initially, defendant Garber has declined to produce any tax-related documents. See Granowitz Deck, U 4.
a two-pronged test to assure a balance between the liberal scope of discovery and the policy favoring the confidentiality of tax returns. “First, the court must find that the returns are relevant to the subject matter of the action. Second, the court must find that there is a compelling need for the returns because the information contained therein is not otherwise readily obtainable.”
Hilt v. SFC, Inc.,
Here, plaintiff has met its burden of showing the information sought is relevant, especially to plaintiffs civil RICO claims. See, e.g., State Farm Mut. Ins. Co. v. CPT Med. Servs., P.C.,
Although there is no federal common law privilege akin to the right of privacy, “ ‘federal courts ordinarily recognize a constitutionally-based right of privacy that can be raised in response to discovery requests.’” Keith H.,
Here, plaintiffs need for defendant Gar-ber’s financial documents outweighs defendant Garber’s claim of privacy, especially when the “impact” of the disclosure of the information can be protected by a “carefully drafted” protective order.
B. Attorney-Client Privilege and Work Product Doctrine:
Defendant Garber has objected to document request nos. 10, 20-27, 47, and 193 on attorney-client privilege and work product doctrine grounds.
Not all communications between an attorney and his client are privileged. Rather, only “[confidential disclosures by a client to an attorney made in order to obtain legal assistance are privileged.” Fisher v. United States,
Under the work product doctrine, material obtained and prepared by an attorney or the attorney’s agent in anticipation of litigation or preparation for trial may be immune from discovery. Fed.R.Civ.P. 26(b)(3); Hickman v. Taylor,
On December 13, 2005, defendant Garber produced a privilege log identifying documents he claims are privileged under the attorney-client privilege and/or the work product doctrine. Joint Stip., Exh. 3. However, the privilege log lists only five documents, and the descriptions of the documents on the privilege log are sketchy and incomplete, to say the least.
In light of defendant Garber’s failings, plaintiff argues defendant Garber has waived any attorney-client privilege that might attach to the documents on the privilege log. Alternatively, plaintiff argues that the documents on the privilege log should be produced to it under the crime or fraud exception to the attorney-client privilege because the relationship between defendant Garber and his attorney, co-defendant Rojas, was in furtherance of fraud upon the investors in Damji’s schemes and part of defendant Gar-ber’s money laundering activities.
6. Preserve documents:
There is no doubt that a litigant has a duty to preserve evidence it knows or should know is relevant to imminent litigation, Dillon v. Nissan Motor Co., Ltd.,
Here, in response to many document requests, defendant Garber states: “Responding party believes he may have been in possession of further responsive documents, but that these documents were either seized during the raid on CRIS or were discarded when Mr. Garber left Costa Rica.” See, e.g., Joint Stip. at 63:25-28. Based on this response, and other things, plaintiff argues that defendant Garber was aware of the Canadian court action in which it was appointed Interim Receiver long before defendant Garber left Costa Rica, and, yet “discarded” documents he should have kept; thus, defendant Garber should be sanctioned. Id. at 64:9-67:19. In response, defendant Garber argues that most of his documents are available from the Costa Rican Government. Id. at 68:5-23. Of course, the Court cannot yet determine whether plaintiff can obtain all the responsive documents from the Costa Rican government that defendant Garber discarded, and, thus, is unable to address plaintiffs claim of spoliation at this time. When discovery is close to being completed, plaintiff may renew its claim for evidentiary sanctions against defendant Garber, and the Court will address the matter then.
7. Attorney’s fees:
Rule 37(a)(4)(A) provides that if a motion compelling disclosure is granted:
the court shall, after affording an opportunity to be heard, require the party ... whose conduct necessitated the motion ... to pay to the moving party the reasonable expenses incurred in making the motion, including attorney’s fees, unless the court finds that the motion was filed without the movant’s first making a good faith effort to obtain the disclosure or discovery without court action, or that the opposing party’s nondisclosure, response, or objection was substantially justified, or that other circumstances make an award of expenses unjust.
Fed.R.Civ.P. 37(a)(4)(A).
Here, plaintiff has established that, by seeking to meet and confer with defendant Garber about this motion, it made a good faith effort to obtain disclosure without court action; but, to no avail. Furthermore, defendant Garber’s responses were not substantially justified, and he has identified no other circumstances making an award of expenses unjust. Thus, plaintiffs motion for sanctions or attorney’s fees should be granted. However, plaintiff has not produced competent evidence supporting its request for attorney’s fees in the amount of at least $15,000.00, and without such proof, the Court is unable to set the amount of fees. If plaintiff intends to pursue this request, it should file a declaration or declarations setting forth the exact hours worked by, and the usual hourly fees of, counsel in preparing this discovery motion, as well as proof of any costs incurred, as set forth in the Order below.
ORDER
1. Defendant Garber shall supplement his documentary responses to plaintiffs first set of requests for production of documents, request nos. 1-194 (except no. 188), no later than thirty (30) days from the date of this Order.
2. Defendant Garber shall provide plaintiff with declarations or affidavits showing the nature of his reasonable inquiry to locate
3. If defendant Garber contends he has provided plaintiff with all documents responsive to a particular discovery request, he shall submit a declaration similar to a Rule 26(g) verification addressing each specific request he contends he has complied with, no later than thirty (30) days from the date of this Order.
4. Defendant Garber shall provide plaintiff an amended privilege log, as described herein, no later than thirty (30) days from the date of this Order. Further, all claims of attorney-client privilege and work product protection shall be supported by declarations discussing items on the log on a document-by-document basis, to be provided to plaintiff contemporaneously with the privilege log.
5. If the supplemental responses to plaintiff do not include documents from nonparties Nextel, Pacific Bell, Elka Bank, Banco de Costa Rica, Bank Hapoalim, Financorp, First Bank of Omaha, Southwest Securities, Union Bank of California, Oceanic Bank & Trust of Bahamas, Offshore Exports, Inc., HSBC Bank, Internal Revenue Service and the California Franchise Tax Board, defendant Gar-ber shall sign releases
6. No later than twenty (20) days from the date of this Order, plaintiff shall file a declaration or declarations setting forth the hours worked by, and the usual hourly fees of, their counsel in preparing the discovery motion, and proof of any costs incurred, and defendant may file an opposition challenging the reasonableness of the hours or hourly rates and costs, within ten (10) days thereafter. The matter will then be deemed submitted and, pursuant to Local Rule 7.11, decided in Chambers without oral argument.
Notes
. The only basis defendant Garber cites to support his numerous "overly burdensome and harassing" objections is that many of plaintiff's document requests seek information "relating to” a subject. However, while a document request seeking information "relating to" a certain subject may be overbroad or overly burdensome, see, e.g., Cotracom Commodity Trading Co. v. Seaboard Corp.,
. However, if defendant Garber contends he has provided plaintiff with all documents responsive to a particular discovery request, he may submit a declaration under oath, similar to a Rule 26(g) verification, as to each specific request he contends he has fully responded to.
. Plaintiff also states that, other than "documents relating to paying taxes and tax liens," defendant "Garber’s counsel agreed to produce all financial documents responsive to Plaintiff’s
. This finding applies to financial records generated by defendant Garber’s accountants, as well as records from financial institutions, and financial records of business entities owned by defendant Garber.
. The Court finds that Model Form 11:A, set forth in The Rutter Group Practice Guide, Federal Civil Procedure Before Trial, correctly and adequately lists all the information that should be set forth on the privilege log, including the title or position of the author and recipient of the document. See In re Grand Jury Investigation,
. "When a lawyer's advice is sought to further a crime or fraud, those communications are not privileged.” Martin,
. Releases for all institutions not located in the United States must be notarized.