Opinion
17cv121-JO (MSB)
02-22-2024
IN RE QUALCOMM INCORPORATED SECURITIES LITIGATION
ORDER DENYING DEFENDANTS' DISCOVERY MOTION REGARDING CLAWBACK OF EXPERT MATERIALS [ECF NO. 321]
Honorable Michael S. Berg, United States Magistrate Judge
Now pending before this Court is the parties' briefing regarding Defendants' Qualcomm Incorporated, Derek K. Aberle, Steven R. Altman, William F. Davidson, Paul E. Jacobs, Steven M. Mollenkopf, and Donald J. Rosenberg (collectively, “Defendants”) request to retain and use material Lead Plaintiffs Sjunde AP-Fonden and Metzler Asset Management GmbH (collectively, “Plaintiffs”) inadvertently produced. After reviewing informal letter briefs lodged by the parties, the Court held an informal Discovery Conference to discuss this issue on November 28, 2023. (ECF No. 313.) The Court indicated it would be inclined to allow Plaintiffs to claw back their inadvertently produced materials (hereinafter “Disputed Materials”). The Court also noted that just because materials are “clawed back,” Defendants would still be able to question the expert about his opinion. Following the conference, Defendants requested an opportunity for formal briefing, and the Court issued a briefing schedule. (ECF No. 314.) On December 21, 2023, Defendants filed their “Discovery Motion Regarding Clawback of Expert Materials.” (“Motion”) (ECF No. 321.) On January 23, 2024, Lead Plaintiffs filed their “Opposition to Defendants' Discovery Motion Regarding Clawback of Expert Materials.” (“Opposition”) (ECF No. 327.) For the reasons explained below, the Court DENIES Defendants' Motion.
I. RELEVANT BACKGROUND
This is a securities class action brought by Plaintiffs against Defendants for allegedly misrepresenting two business practices that led to regulatory actions and litigation, which ultimately caused Qualcomm's stock price to decline. The first business practice that Defendants allegedly misrepresented was that “Qualcomm touted that it ‘broadly license[d]' its technology throughout the industry when, in fact, Qualcomm did not license at the chip level and refused to license competing chipmakers.” (ECF No. 279, at 3.) The second was that Defendants allegedly “misled the market by stating that [Qualcomm] kept its licensing and chip-supply businesses separate when, in fact, Qualcomm regularly bundled the two in negotiations and agreements.” (Id.) The District Court partially granted class certification and certified a class of investors only with regard to Plaintiffs' “bundling” theory. (Id. at 35.)
Plaintiffs hired Dr. David Tabak as their expert to offer an opinion about damages for the class. (Opp'n at 2.) Plaintiffs submitted Dr. Tabak's report on September 12, 2023, which included a formula that disaggregated certain licensing information by applying content analysis. (Mot., Ex. 1.) The content analysis involves Dr. Tabak reviewing news stories about Qualcomm, looking for certain terms that relate to Plaintiffs' bundling theory, counting the number of times those terms come up, and using that count to estimate what portion of a stock price decline related to bundling. (Id.)
On May 29, 2019, the parties filed a joint motion for a Protective Order and an Order regarding discovery of Electronically Stored Information and related discovery matters (“ESI Order”). (ECF No. 78.) This Court reviewed the parties' requests and granted them with one modification. (ECF No. 79.) In pertinent part, the stipulated ESI
Order provided that the parties would not be required to disclose, even in an expert deposition, or include on a privilege log: (i) “any form of communication or work product shared” between counsel and experts or among the experts and consultants; (ii) “any form of communication or work product shared between an expert and persons assisting the expert”; (iii) “expert's notes, unless they are expressly relied upon and/or cited in support of an opinion or fact”; and (iv) “drafts of expert reports, analyses, or other work product.” (ECF No. 78-2, § 8(c).)
After reviewing Dr. Tabak's report and “out of an abundance of caution,” Defendants notified Plaintiffs that they were in possession of certain materials that originated from Dr. Tabak's staff and from Plaintiffs' counsel, which they believed were not protected. (Opp'n, Ex. B.) Plaintiffs subsequently relayed to Defendants that the material was inadvertently disclosed, and they were clawing them back pursuant to the ESI and Protective Orders. (Opp'n at 3.) The Disputed Materials include three categories of documents: (1) a spreadsheet tab that appears to contain terms related to Dr. Tabak's content analysis and counsel's comments on those terms; (2) spreadsheet tabs that appear to contain a count of terms from reports that were ultimately not used in Dr. Tabak's report; and (3) comments that Dr. Tabak's staff made on articles that were appended to his report. (Mot. at 4; Opp'n at 3-4.)
II. DISCUSSION
Defendants brought the instant Motion to prevent Plaintiffs from clawing back the Disputed Materials. Plaintiffs argue that both the ESI Order and the Federal Rules of Civil Procedureprotect the Disputed Materials from disclosure as either attorneyexpert communications or draft reports. Defendants disagree with Plaintiffs' interpretation of the ESI Order and believe that the Rules do not cover the Disputed Materials because they are either not draft reports or fall under the Rules' exceptions for protected attorney-expert communications.
All future references to the Rules refer to the Federal Rules of Civil Procedure unless otherwise noted.
A. Legal Standard
The Rules permit parties to obtain discovery of any nonprivileged matter relevant to the needs of the case. Fed.R.Civ.P. 26(b)(1). District courts have broad discretion to grant or deny discovery. See Hallett v. Morgan, 296 F.3d 732, 751 (9th Cir. 2002) (“[B]road discretion is vested in the trial court to permit or deny discovery, and its decision to deny discovery will not be disturbed except upon the clearest showing that denial of discovery results in actual and substantial prejudice to the complaining litigant.”) (quoting Goehring v. Brophy, 94 F.3d 1294, 1305 (9th Cir. 1996)).
B. Protections Under Rule 26(b)
First, the Court will address whether the Disputed Materials are protected under Rule 26(b). The Rules clarify that the attorney work-product doctrine covers two types of expert material. See Fed.R.Civ.P. 26(b)(3)(A); see also Republic of Ecuador v. Mackay, 742 F.3d 860, 870 (9th Cir. 2014) (explaining the history of the 2010 amendments to the Rules). The first type of material protected from discovery includes expert draft reports or disclosures. Fed.R.Civ.P. 26(b)(4)(B). The second type consists of communications between the party's counsel and expert witnesses. Fed.R.Civ.P. 26(b)(4)(C). Although there are three disclosure exceptions for communications between experts and attorneys, the two most relevant here are (1) communications that “identify facts or data that the party's attorney provided and that the expert considered in forming the opinions to be expressed;” and (2) communications that “identify assumptions that the party's attorney provided and that the expert relied on in forming the opinions to be expressed.” Fed.R.Civ.P. 26(b)(4)(C)(ii)-(iii). The burden of proving any evidentiary privilege rests with the party asserting it. Weil v. Inv./Indicators, Rsch. & Mgmt., Inc., 647 F.2d 18, 25 (9th Cir. 1981). Additionally, documents and tangible things that are protected under these sections may also be discoverable if the party shows a “substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means.” Fed. R. Civ. P. 26(b)(3)(A)(ii).
1. The BLBG Counts Tab
The first Disputed Material is a tab titled “BLBG Counts” in an Excel spreadsheet that Plaintiffs inadvertently produced along with Dr. Tabak's report (hereinafter, “BLBG Counts Tab”). (Mot. at 4; Opp'n at 3.) “BLBG” is the acronym for Plaintiffs' counsel's firm at Bernstein Litowitz Berger & Grossmann LLP. The tab includes the number of hits for certain words that were searched in news articles for Dr. Tabak's content analysis, as well as notes made by counsel.
Plaintiffs argue that the BLBG Counts Tab is protected as attorney work-product and communications between counsel and expert. They explain that the BLBG Counts Tab consists of “direct communications between counsel and their expert about a draft report and includes counsel's mental impressions regarding Dr. Tabak's ongoing content analysis.” (Opp'n at 6.)Defendants argue that the tab falls under the Rule's exceptions as either facts or data considered or assumptions relied upon because it shows that Plaintiffs' counsel decided which words to use for Dr. Tabak's content analysis. (Mot. at 6.) Defendants characterize the BLBG Counts Tab as evidence that Plaintiffs' counsel “commandeered” the expert report. (Id.) Because Dr. Tabak's report is a content analysis, the words that are chosen and omitted are facts or assumptions that “undergird” the analysis. (Id.)
Plaintiffs conflate some of their Rule 26 and ESI Order arguments by insisting that Defendants already stipulated that the parties would not disclose material that experts merely “considered” but did not “rely upon.” (Opp'n at 5.) Protections provided by Rule 26 and the ESI Order are two separate arguments; thus, in this section, the Court will only assess whether Rule 26 protects the Disputed Materials and will not consider the stipulation between the parties.
The work-product doctrine, codified in Rule 26(b)(3), protects from discovery documents that reveal “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). “At its core, the work-product doctrine shelters the mental processes of the attorney, providing a privileged area within which he can analyze and prepare his client's case,” and protects both “material prepared by agents for the attorney as well as those prepared by the attorney himself.” United States v. Sanmina Corp., 968 F.3d 1107, 1119 (9th Cir. 2020) (citing United States v. Nobles, 422 U.S. 225, 238 (1975)). The Rule explicitly provides this protection to communications between a party's counsel and expert, subject to the exceptions listed above. See Fed.R.Civ.P. 26(b)(4)(C).
The BLBG Counts Tab is attorney work-product that was communicated to Plaintiffs' expert. Plaintiffs explain that the tab was created by counsel and the comments, which provide impressions on certain terms, were authored by counsel as well. (Opp'n at 3.) Defendants do not dispute that the tab would otherwise be attorney work-product; indeed, they want to use the document to show that Plaintiffs' counsel “commandeered” the expert report by instructing Dr. Tabak on which terms to use. (Mot. at 6-7.)
a. The BLBG Counts Tab is not evidence that counsel commandeered the expert report
This Court is unconvinced that this document is evidence that Plaintiffs' counsel “jeopardize[d] the experts' independence” in a way that would necessitate its discoverability. Gerke v. Travelers Cas. Ins. Co. of Am., 289 F.R.D. 316, 328 (D. Or. 2013). In Gerke, the expert's deposition testimony suggested counsel authored portions of the final report and that counsel changed his preliminary report before submitting it as a final report, in addition to other discrepancies that made the court question the expert's independence. Id. Because counsel's significant involvement in the expert's report was already apparent, the court found that additional disclosure of communications was warranted because “the facts, data, and assumptions provided by [p]laintiff's counsel might well have become [the expert's] opinion or have formed part of it.” Id. at 329. In McClellan v. I-Flow Corp., there were email communications and deposition testimony that heavily suggested that counsel (1) created the idea for the expert's study; (2) provided raw patient data; (3) selected the nurse to perform the study; (4) conducted his own findings with the data and compared those with the expert's findings; (5) encouraged the expert to do the same comparison; (6) identified patients who should be diagnosed and helped “correct” diagnoses; and (7) directed the expert to include certain patients. 710 F.Supp.2d 1092, 1124 (D. Or. 2010).
The current record before the Court does not come close to either case. Courts acknowledge “the reality that attorneys often feel that it is extremely useful-if not necessary-to confer and strategize with their experts.” Mackay, 742 F.3d at 870. On its face, the BLBG Counts Tab shows only that counsel shared commentary on specific terms that Dr. Tabak may or may not have used in his final report. Dr. Tabak then signed a declaration under oath that states that he did not rely on the BLBG Counts Tab to form his opinions, and his final exhibit differs from the tab. (Mot., Ex. 4.) As will be discussed in more detail below, the document seems to represent Plaintiffs' counsel's attempt to confer and strategize with Dr. Tabak within the appropriate bounds of the Rule. Thus, the Court does not find Plaintiffs' counsel has crossed any lines that would make this document discoverable under Gerke or McCellan.
b. The BLBG Counts Tab reflects counsels' mental impressions and does not fall under Rule 26(b)(4)(C)'s exceptions
The true issues here then are whether the document identifies “facts or data that the party's attorney provided and that the expert considered in forming the opinions to be expressed” or “assumptions that the party's attorney provided and that the expert relied on in forming the opinions to be expressed” and whether that makes the entire document discoverable. Fed.R.Civ.P. 26(b)(4)(C)(ii)-(iii). Many courts interpret the exceptions to cover only materials that primarily contain facts or data provided by counsel for the expert to review. See Davita Healthcare Partners, Inc. v. United States, 128 Fed.Cl. 584, 591-92 (2016) (denying motion to compel for spreadsheets, graphs, and analyses that “are interpretations of data that reflect counsel's mental impressions” and “separate and apart from the underlying facts and data themselves”); In re Elysium Health-ChromaDex Litig., No. 17-CV-7394 (LJL), 2021 WL 1249223, at *3 (S.D.N.Y. Apr. 5, 7 2021) (the Rule “does not require production of each underlying document that contains the facts considered or the assumptions upon which the expert relied”).
Defendants have not cited any case that supports the contention that the exceptions make the entire document discoverable, except that the 2010 advisory committee notes state that “facts or data' [should] be interpreted broadly to require disclosure of any material considered by the expert, from whatever source, that contains factual ingredients.” (Mot. at 5 (citing Fed.R.Civ.P. 26(a)(2)(B) advisory committee's note to 2010 amendment).) However, that conflicts with the actual language of the Rule, which limits disclosure “to the extent” the communications fall under the exceptions. Fed.R.Civ.P. 26(b)(4)(C). Indeed, the same advisory committee notes later say “[t]he exception applies only to communications ‘identifying' the facts or data provided by counsel; further communications about the potential relevance of the facts or data are protected.” Davita, 128 Fed.Cl. at 592 (quoting Fed.R.Civ.P. 26(b)(4) advisory committee's note to 2010 amendment). Accordingly, this Court will give greater weight to the language of the rule and case authorities interpreting that language. See, e.g., Spirit Lake Tribe v. Jaeger, 5 F.4th 849, 853 (8th Cir. 2021) (“An advisory committee note . . . cannot change the meaning of the plain language of a federal rule of procedure. So ‘if the rule and the note conflict, the rule must govern.'”) (quoting United States v. Carey, 120 F.3d 509, 512 (4th Cir. 1997)).
Although some facts or data may be relayed in a communication between counsel and expert, it does not make the entire communication discoverable. If that were the case, then almost all attorney-expert communication would be unprotected, and the rule would be pointless. See In re Elysium, 2021 WL 1249223, at *3 (finding that such interpretation “would require disclosure of . . . every communication with counsel that mentioned a fact that the expert considered and thus would create an exception that would swallow the rule”).
The court in Davita found that an experts' “spreadsheets, graphs, and analyses . . . [which] are interpretations of data that reflect counsel's mental impressions and result from the expert's and counsel's collaborative efforts to organize, marshal and, present data” are “separate and distinct from the underlying facts and data themselves.” Davita, 128 Fed.Cl. at 591. The BLBG Counts Tab generally fits that description; the only difference is that the tab here was created by counsel whereas the spreadsheets in Davita were created by the expert. This difference, however, is not material because the fact that it was created by counsel strengthens Plaintiffs' claims that such document is meant to be protected under Rules 26(b)(3) and (b)(4)(C) as attorney work-product. While the Court agrees with Defendants that the terms themselves are facts and data that form the basis of Dr. Tabak's content analysis, the entire tab represents an interpretation of underlying facts and data that involves counsel's protected mental impressions, which makes it separate and distinct from the underlying facts and data. Even if the Rule did not protect the entire document, counsel's comments on the terms would be protected because they are mental impressions, conclusions, or opinions, and not the actual facts or data. The Rules do not protect what terms Dr. Tabak considered and reasons why he decided to use certain terms over others, but counsel's thoughts on them are protected. Because Defendants want to use the document for the benefit of knowing their opposing counsels' impressions on terms Dr. Tabak may have considered for his report, this Court finds that the BLBG Counts Tab is protected under Rule 26(b)(4)(C).
2. The Analyst Tabs
The second Disputed Material is another spreadsheet, which ultimately was not used in the final report, created by Plaintiffs' expert that includes word counts in a set of analyst reports (hereinafter, “Analyst Tabs”). Plaintiffs argue that the Analyst Tabs are protected under Rule 26(b)(4)(B) as a draft report or disclosure, as well as communications between expert and counsel under Rule 26(b)(4)(C). (Opp'n at 7-8.) Defendants argue the Analyst Tabs are neither, but instead, the tabs are representative of an alternative analysis that they believe they are entitled to. (Mot. at 7-8.)
In addition to expert-attorney communications, the Rules also protect “drafts of any report or disclosure required under Rule 26(a)(2), regardless of the form in which the draft is recorded.” Fed.R.Civ.P. 26(b)(4)(B). “Such protected disclosures include draft worksheets created by [the expert] or his assistants for use in his expert reports.” In re Application of Republic of Ecuador, 280 F.R.D. 506, 512 (N.D. Cal. 2012), aff'd sub nom. Mackay, 742 F.3d; see also Davita, 128 Fed.Cl. at 591 (“Spreadsheets, graphs, presentations, and charts are protected under Rule 26(b)(4)(B), so long as the documents were prepared by the testifying expert to be included in draft expert reports”). The Rule “does not extend to the expert's own development of the opinions to be presented outside of draft reports.” In re Rep. Ecuador, 280 F.R.D. at 513.
Defendants cite one case that takes this analysis a step further to determine that materials are not a draft if they bear no resemblance to the final. See PacifiCorp v. N.W. Pipeline, 2012 WL 13195529, at *4 (D. Or. Feb. 29, 2012) (finding that an earlier version of a report was not a “draft” because the final report was not “merely . . . a refinement or revision” of the earlier version). Because this case is not binding on this Court, this Court respectfully declines to follow this rationale. The plain meaning of a “draft” implies that there may be material that ultimately is not included in the final version. The published findings held in Davita and In re Rep. Ecuador do not express that the protections cover only material that would be included in the final expert report. Other examples of a draft report include documents that were intended to be in the report, that were “actually included in earlier versions” of the report, or that represent “summaries and conclusions that might reasonably be expected to be included in a draft report.” Plexxikon Inc. v. Novartis Pharms. Corp., No. 17CV04405HSGEDL, 2019 WL 8508083, at *4 (N.D. Cal. May 3, 2019) (collecting cases).
Defendants further argue that “Rule 26 mandates disclosure of alternative analysis” but they do not cite authority for this assertion, and this Court has not found any. (Mot. at 8, emphasis added.) While it is true that counsel is free to question expert witnesses about “alternative analyses, testing methods, or approaches to the issues on which they are testifying, whether or not the expert considered them in forming the opinions expressed[,]” it does not appear to be one of the mandatory disclosures under Rule 26(a)(2). Plexxikon, 2019 WL 8508083, at *4 (finding that “alternative analyses, testing methods, or approaches to the issues” are not “mandatory to disclose”).
Plaintiffs explain that the Analyst Tabs are an “incomplete [analysis] conducted for discussions with counsel, but rejected by Dr. Tabak and not included in his final report.” (Opp'n at 8.) Under Rule 26(b)(4)(C), “[d]ocuments regarding methods [an expert] chose not to use are independently protected from disclosure to the extent they were prepared for and sent to counsel[.]” Plexxikon, 2019 WL 8508083, at *4. Because this spreadsheet appears to represent an unfinished analysis of alternative theories or strategies that the expert and counsel were exploring, it fits within the protections of attorney-expert communications. Although not as evident as in the BLBG Counts Tab, the spreadsheet is an interpretation of data that reflect counsel's and the expert's legal strategy because it was prepared by Dr. Tabak and sent to counsel. This is analogous to the “spreadsheets with claims data analysis for presentation to counsel” in Davita. Davita, 128 Fed.Cl. at 590.
Furthermore, unlike it Plexxikon, Plaintiffs sufficiently establish that the Analyst Tabs are worksheets that Dr. Tabak may have initially intended to use in his report but ultimately chose not to after discussions with counsel. Therefore, this Court finds that the Analyst Tabs are protected as both an attorney-expert communication under Rule 26(b)(4)(C) and a draft report or disclosure under Rule 26(b)(4)(B).
3. The Staff
The third Disputed Material includes comments that Dr. Tabak's staff made on articles that were appended to the expert report (hereinafter, “Staff Notes”). The parties do not dispute that the comments include questions to Dr. Tabak about the categorization of certain terms in respective news articles that were attached to the report. (Mot. at 4; Opp'n at 3.) Plaintiffs argue that these Staff Notes are protected under Rule 26(b)(4)(B) as draft reports or disclosures, as well as communications between expert and counsel under Rule 26(b)(4)(C). (Opp'n at 7-9.) Defendants disagree and state that the Staff Notes are unprotected “notes of . . . testing.” (Mot. at 8.)
The Staff Notes are not communications involving an attorney. To be protected under Rule 26(b)(4)(C), documents must be prepared for and sent to counsel. See Plexxikon, 2019 WL 8508083, at *4. Although the court in In re Rep. Ecuador applied a blanket protection of an expert's internal communications even when they did not involve an attorney, this Court respectfully disagrees that Rule 26(b)(4)(C) reaches so far. See In re Rep. Ecuador, 280 F.R.D. at 514 (finding that communications between the expert, his assistants, and the expert's company employees were protected as work product under Rule 26(b)(4)(C)). The Rule protects “communications between a party's attorney and expert witnesses.” Fed.R.Civ.P. 26(b)(4)(C) (emphasis added). Without an attorney involved, the communication simply does not fit the bill. Dr. Tabak's declaration states that these notes were “provided to counsel” (Mot., Ex. 4) but based on Plaintiffs' own characterization of the Staff Notes, the questions were not actually for counsel but instead were more of an internal discussion on how to categorize terms. Nothing indicates that such comments would be reflective of discussions between attorney and expert or the attorneys' mental impressions. Because it is the party asserting the privilege who has the burden to show privilege, Plaintiffs have not shown enough to meet their burden here. Weil, 647 F.2d at 25. Therefore, these comments are not protected by Rule 26(b)(4)(C).
Plaintiffs combine their Staff Notes argument with the Analyst Tabs, which makes it difficult for the Court to understand how they believe that the staff's comments are protected as draft reports. Protection under Rule 26(b)(4)(B) stems from the attorney work-product doctrine. See Salazar v. Ryan, No. CV-96-00085-TUC-FRZ, 2017 WL 2633522, at *2 (D. Ariz. June 19, 2017) (discussing how “Rule 26(b)(4)(B) protects draft reports because ‘the drafting process ordinarily entails communications between the expert and counsel' and disclosing draft reports ‘is likely to include revelation of attorney work product.'”) (quoting Wenk v. O'Rielly, 2014 WL 1121920, at *4 (S.D. Ohio Mar. 20, 2014)). The staff comments are not analogous to the spreadsheets, presentations, or analyses that were protected in Davita or In re Rep. of Ecuador, because they were not prepared for inclusion in the expert report. Plaintiffs describe the Staff Notes as comments on the articles-not the report itself. (Opp'n at 3.) Since these comments were not evidently intended for counsel, they unlikely reflect any legal strategy or mental impressions of counsel that the Rule was intended to protect. Courts have also concluded that “[a]n expert's notes setting out in detail the content and structure of her report, or even just a section of her report, could properly be shielded from disclosure by Rule 26(b)(4)(B).” Deangelis v. Corzine, 2016 WL 93862, *4 (S.D.N.Y. 2016). However, Plaintiffs do not contend the Staff Notes detail the content and structure of even a section of Dr. Tabak's report. Accordingly, this Court finds that the Staff Notes are not protected by Rule 26 because they are also not protected as a draft report under Rule 26(b)(4)(B).
4. Defendants have not established a substantial need
Although two of the three Disputed Materials are protected by Rule 26(b), they may still be discoverable if the party shows a “substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means.” Rule 26(b)(3)(A)(ii). The party seeking documents must demonstrate more than a need for materials that “would be helpful to understanding, verifying, and analyzing the damages analysis.” See Elysium, 2021 WL 1249223, at *3. Defendants claim they have a substantial need for the documents because they do not have “details regarding how [Dr. Tabak] selected the words in his analysis or how articles were coded, and he claims that he eschewed analyst reports for reasons that the materials disclosed show to be false.” (Mot. at 9.) However, Defendants do not explain why they would not be able to ask Dr. Tabak those questions in a deposition without the Disputed Materials, and this Court is not convinced that those documents are necessary to do so.
Furthermore, Defendants' concerns over their ability to impeach Dr. Tabak is unpersuasive. As this Court has already held, a “hypothetical opportunity for 13 impeachment does not support a finding of substantial need.” U.S. ex rel. Everest Principals, LLC v. Abbott Labs., 2023 WL 8040762, at *8 (S.D. Cal. Nov. 20, 2023). Although Defendants assert the Analyst Tabs directly refute claims in Dr. Tabak's report, such interpretation of the protected document is conjectural. Defendants are entitled to ask questions about Dr. Tabak's analysis and his processes, but they may not ask him questions about information gleaned from protected documents.
C. The ESI Order's Protection over Expert Material
Since one of the three Disputed Materials is not protected under Rule 26(b), the Court will assess whether the ESI Order protects such material. It is undisputed that the Disputed Materials fit under the categories listed in Section 8(c) of the ESI Order and that Plaintiffs inadvertently disclosed them.However, Defendants argue that the expert materials under Section 8(c) are not “protected” by the ESI Order because it only states that the parties are “not required” to disclose certain material and there is a separate Section 7, which is titled “Documents Protected from Discovery,” that does not expressly protect the materials under Section 8(c). (Mot. at 5.) Plaintiffs argue that Defendants' reading of the ESI Order elevates form over function and that Section 7(a) is not limited to the items listed in Section 7(b) but also covers the material listed in Section 8(c). (Opp'n at 5.) Neither side cites legal authority to support their respective positions.
The Staff Notes would fit under Section 8(c) as “any form of communication or work product shared between an expert and persons assisting the expert” or “expert's notes, unless they are expressly relied upon and/or cited in support of an opinion or fact.” (ECF No. 78-2, § 8(c).)
Parties may stipulate that “other procedures governing or limiting discovery be modified.” Fed.R.Civ.P. 29. The Court will generally hold parties to such stipulations. See Elvis Presley Enterprises, Inc. v. City of Memphis, Tennessee, 2020 WL 4015476, *4 (W.D. Tenn. 2020); In re XPO Logistics, Inc., 2017 WL 6343689, *7 (S.D. N.Y. 2017) (“Agreements in the discovery context are enforced according to their terms.”). “Because stipulations serve both judicial economy and the convenience of the parties, courts will enforce them absent indications of involuntary or uninformed consent.” CDN Inc. v. Kapes, 197 F.3d 1256, 1258 (9th Cir. 1999). District courts have inherent authority to interpret and enforce compliance with stipulations that they previously entered as an order. See N. Cent. Distrib., Inc. v. Bogenschutz, No. 117CV01351AWIEPG, 2018 WL 4027048, at *15 (E.D. Cal. Aug. 21, 2018) (finding district court had “the inherent authority to enforce compliance with a consent decree that it has entered in an order” and was “ the principal and proper arbiter with the responsibility to interpret the decree”) (citing Nehmer v. U.S. Dep't of Veterans Affairs, 494 F.3d 846, 860 (9th Cir. 2007)). When assessing a stipulated protective order, courts will consider the nature of the protective order, whether the agreement disserves public policy that favors full discovery, or is “otherwise manifestly inequitable.” Parkway Gallery Furniture, Inc. v. Kittinger/Pennsylvania House Grp., Inc., 121 F.R.D. 264, 267 (M.D. N.C. 1988).
Defendants' understanding that the expert materials in Section 8(c) are not protected under Section 7(a), because the parties simply were “not required” to disclose those materials, would result in an unjustifiably unbalanced dynamic between the parties. The parties agreed that certain materials would not be disclosed to each other, and this agreement carries an assumption that the parties would not be able to use such materials against the other. Correspondence between the parties' counsel confirms that Defendants understood that certain documents did not have to be disclosed under Section 8(c) and refused to provide documents on that basis. (See Opp'n, Ex. 1.)
If Defendants' interpretation was enforced, then they would be able to use inadvertently disclosed materials against Plaintiffs while also maintaining the ability to keep similar documents from them. This Court certainly would not have approved that ESI provision if it would produce such an outcome, and it is doubtful the parties intended this effect when they proposed it to the Court. On the other hand, Plaintiffs' interpretation is more reasonable. (Opp'n at 4-6.) Section 7(a) of the ESI Order allows the parties to claw back inadvertently produced material that is “privileged or otherwise protected ESI.” (ECF No. 78-2, § 7(a).) “Protected ESI” is an undefined term, and Section 7(b) of the ESI Order does not purport to contain an exclusive list of “protected ESI” but instead provides a list of information that the parties agreed do not need to be included in a privilege log. (ECF No. 78-2, § 7(b).) As a result, there was no need to expressly include the expert material in Section 8(c) in Section 7(b) because it already explicitly exempts the parties from including material in a privilege log.
While some of the Disputed Materials are not protected by Rule 26 and public policy favors fulsome discovery, the parties agreed to limits of discovery in the stipulated ESI Order, which both sides have been relying on for almost five years. This Court will hold the parties to those parameters. See, e.g., Tradeshift, Inc. v. BuyerQuest, Inc., No. 20-CV-01294-RS (TSH), 2021 WL 1586283, at *2 (N.D. Cal. Apr. 23, 2021) (finding that, even if the party did not have a legal obligation to search personal emails, the stipulation that required the search was enforceable). If the Court enforced the ESI Order using Defendants' interpretation, it would prejudice Plaintiffs because they would be barred from obtaining similar expert materials from Defendants based on a technicality. However, Defendants would not be prejudiced if the Court upheld the status quo here because they already benefited from the stipulation. As discussed, Defendants have not shown a substantial need for the documents, and Defendants still can assess the validity and reliability of the expert report without the Disputed Materials and by following the ESI Order.
This Court finds that the ESI Order limits expert discovery and protects the materials listed under Section 8(c), and therefore, Plaintiffs appropriately clawed back the Disputed Materials pursuant to the stipulated ESI and Protective Orders.
To ease Defendants' concerns over the questions they plan to ask Dr. Tabak at his deposition (Mot. at 10), this Court expressly finds that information about how Dr. Tabak decided which words to use, what material to analyze, and his method on coding news stories is not protected under the ESI Order.
III. CONCLUSION
For the reasons discussed in this Order, the Court finds that the Disputed Materials are either protected under Rule 26(b) or the ESI Order. The Court therefore DENIES Defendants' Motion in all respects.
IT IS SO ORDERED.