Case Information
*2 Before LUCERO , SEYMOUR , and TYMKOVICH , Circuit Judges.
This appeal arises from a collateral proceeding to a False Claims Act action against J-M Manufacturing (J-M) in federal court in California. During the course of litigation, the United States arranged to have Microbac Laboratories conduct tests on J-M pipe to determine whether it would intervene in the action. The government eventually declined to intervene. J-M subsequently served a subpoena on Microbac, seeking the test results, which the plaintiffs in the California case and the United States opposed.
Affirming the order of the magistrate judge to quash the subpoena, the district court held the test results constitute protected attorney work product under Rule 26 of the Federal Rules of Civil Procedure for which J-M has not demonstrated a substantial need. J-M appealed, and, exercising jurisdiction under 28 U.S.C. § 1291, we AFFIRM. [1]
*3 J-M Manufacturing is the world’s largest manufacturer of polyvinyl chloride (PVC) pipe, which it sells to federal, state, and local governments for use in water and sewer systems. In 2006, a former J-M employee filed under seal a qui tam complaint pursuant to the False Claims Act, 31 U.S.C. § 3729 et seq. , on behalf of various government entities in federal court in California. Several states and dozens of municipalities intervened in the action. The complaint alleged J-M falsely represented that its pipe was made and tested in conformity with certain industry standards. In November 2013, a federal jury found J-M liable for defrauding the government purchasers.
This appeal concerns a collateral proceeding in the District of Colorado. Shortly after the qui tam complaint was filed, the United States began investigating whether it would intervene in the action. As part of its investigation, the United States retained Microbac to test samples of J-M pipe at the company’s Colorado laboratory. The United States and J-M negotiated over the samples of pipe to be tested and tests to be performed. Although J-M *4 supplied the United States with samples for testing, the J-M pipe samples the United States submitted to Microbac were different from those provided by J-M. After Microbac concluded its tests, the United States declined to intervene. J-M served Microbac with a subpoena, pursuant to Rule 45 of the Federal Rules of Civil Procedure, seeking the test results. The plaintiffs filed a motion to quash the subpoena, which the United States joined.
The magistrate judge partially denied the motion to quash. He reasoned that, because the plaintiffs were pursuing their fraud case on the theory that “every piece of pipe” J-M manufactured was nonconforming, J-M had a substantial need for any test results. The plaintiffs filed a motion for reconsideration, asserting their theory of the case was that, although J-M falsely represented that all of its pipes were manufactured and tested in conformity with industry standards, some of the pipes did not so conform. Under this theory, the plaintiffs would have to show only some of the pipes it purchased from J-M did not conform to industry standards. The district court in California issued a “Bifurcation Order” that clarified the plaintiffs were proceeding under such a theory, which it called a “lottery ticket” theory. Upon reconsideration, the magistrate judge reversed his previous order and quashed the subpoena. He concluded that, because a single test’s results would have minimal probative value under a “lottery ticket” theory, J-M did not have a substantial need for the Microbac test results.
J-M appealed to the district court, which overruled J-M’s objections and affirmed the magistrate judge’s order. Because the test results may reveal attorney selective processes about which pipes to test or which tests to perform, the court concluded that the test results qualified as opinion work product, which our precedent suggests is absolutely privileged. In the alternative, the court held that, even if the test results constitute only ordinary work product, J-M had not demonstrated substantial need for them because the plaintiffs were proceeding under the “lottery ticket” theory in the California case.
We review de novo whether the district court employed the correct legal
standard in resolving a discovery request.
Murphy v. Deloitte & Touche Grp. Ins.
Plan
,
“Ordinarily, a party may not discover documents and tangible things that
are prepared in anticipation of litigation or for trial by or for another party or its
representative (including the other party’s attorney, consultant, surety,
indemnitor, insurer, or agent).” Fed. R. Civ. P. 26(b)(3)(A);
see also Oklahoma v.
*6
Tyson Foods, Inc.
,
The district court did not abuse its discretion in declining to overrule the
magistrate judge’s quashing of the subpoena.
[3]
J-M argues that the district court
abused its discretion because the court failed to consider new evidence that
*7
allegedly showed the plaintiffs’ abandonment of the “lottery ticket” theory of
liability. In support of this argument, J-M points to the plaintiffs’ agreement in
the California case to produce all “non-privileged test results” pertaining to the
durability of J-M pipe because of their potential relevance to the conformity or
non-conformity of J-M pipe to industry standards. But this discovery agreement
did not affect the theory of liability that the plaintiffs were pursuing. Conceding
the potential relevance of J-M pipe test results in the context of a “lottery ticket”
theory does not signal abandonment of the theory. Nor does a showing of
“potential relevance” mean that J-M has demonstrated a substantial need for the
test results—J-M must show the test results “carr[y] great probative value on
contested issues.”
Nat’l Cong. for Puerto Rican Rights
,
J-M also argues that it has a substantial need for the test results because they contradict the plaintiffs’ allegations that J-M “cherry-picked” pipe samples for testing. One of the allegations in the complaint is that J-M cherry-picked PVC pipe samples for testing for the purpose of misrepresenting the quality of its pipes to government purchasers. Although J-M could conduct its own independent testing on randomly selected pipes, it asserts that the plaintiffs could *8 attack the credibility of any independent testing it arranges because J-M was involved in the testing process, even if only minimally. [4]
Potential attacks on the credibility of independent testing done in preparation for litigation are not sufficient to show a substantial need for an opposing party’s test results. If we were to hold otherwise, this justification could conceivably apply to all tests conducted by parties in anticipation of litigation and would discourage parties from engaging in independent testing. Further, even if we could practically enforce this rule, the Microbac test results would have no probative value on the cherry-picking issue. The cherry-picking allegations concern J-M’s process of selecting pipe samples for testing as part of its alleged fraudulent scheme. And because J-M did not select the pipes that Microbac tested, the test results would reveal nothing about J-M’s pre-discovery selective process. Favorable test results would reveal only that some random samples of pipe met industry standards, which is fully consistent with the plaintiffs’ theory and would not contradict their cherry-picking allegations.
We thus reject J-M’s alternative theory of substantial need. Because J-M has failed to demonstrate a substantial need for the test results, we AFFIRM the judgment of the district court. We DENY the motions to supplement the record. *9 ENTERED FOR THE COURT, Timothy M. Tymkovich Circuit Judge
Notes
[*] This order and judgment is not binding precedent except under the doctrines of law of the case, res judicata and collateral estoppel. It may be cited, however, for its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
[1] We note the appellees’ observation that “[d]iscovery orders entered
during the course of litigation ordinarily are not ‘final’ under [§ 1291].”
In re
Motor Fuel Temperature Sales Practice Litig.
,
[1] (...continued)
the district court before which the main action is pending, issues an order denying
discovery against a nonparty.”
Hooker v. Cont’l Life Ins. Co.
,
[2] Opinion work product reveals “the mental impressions, conclusions,
opinions, or legal theories of a party’s attorney or other representative concerning
the litigation.” Fed. R. Civ. P. 26(b)(3)(B). Opinion work product is absolutely
privileged.
See In re Qwest Commc’ns Int’l Inc.
,
[3] Although the district court also held that the test results qualify as opinion work product, we need not reach that issue because, regardless of how we classify the test results, J-M has fallen short of demonstrating substantial need for them.
[4] At oral argument, J-M contended that the plaintiffs did in fact attack the credibility of its independent testing at trial in California during cross- examination.