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Chevron Corporation v. the Weinberg Group

September 26, 2012

CHEVRON CORPORATION, PETITIONER,
v.
THE WEINBERG GROUP, RESPONDENT.



The opinion of the court was delivered by: John M. Facciola United States Magistrate Judge

MEMORANDUM OPINION

This case originally came before me on petitioner Chevron Corporation's Motion to Compel the Production of Documents from the Weinberg Group Pursuant to Federal Rule of Civil Procedure 45 [#1].*fn1 Due to the complex procedural and factual nature of this case, I will begin by summarizing the proceedings thus far.

INTRODUCTION

I.The Civil Action in the Southern District of New York

The larger case behind the instant motion was previously summarized as follows: "Some Ecuadorian citizens [the Lago Agrio Plaintiffs or 'LAPs'] sued Chevron in an Ecuador court, alleging that Chevron was responsible for environmental damage there." Chevron Corp. v. Weinberg Group, 682 F.3d 96, 97 (D.C. Cir. 2012). Lead counsel for the LAPs was Steven Donziger. The LAPs prevailed in the Ecuadorian court and secured a multi-billion dollar judgment against Chevron. The nearly endless litigation that has now been spread out over courts all across America*fn2 is focused on Chevron's attempts to gain discovery in support of its effort to prevent that judgment from being executed. The centerpiece of Chevron's effort is a Racketeer Influenced and Corrupt Organizations Act ("RICO") action, 18 U.S.C. §§ 1961-1968,*fn3 by Chevron against Donziger and his alleged conspirators, currently pending before the Southern District of New York. See, Chevron Corp. v. Donziger, Civil Action No. 11-0691 (S.D.N.Y.), Amended Complaint [#283] ("SDNY Amended Complaint").

II.The Allegations of Fraud

According to Chevron, the ultimate judgment from the Ecuadorian court was procured by fraud. That judgment relied heavily on a report prepared by a court-appointed expert, Richard Stalin Cabrera, who was tasked with making a neutral and independent assessment of the environmental damage done by Chevron. However, it eventually came to light that Cabrera was not, in fact, neutral. Memorandum in Support of Chevron Corporation's Motion to Compel [#1-1] at 4-5; SDNY Amended Complaint [#283] ¶¶ 122-184. Indeed, it appeared that LAPs' representatives worked directly with Cabrera to draft the report. Chevron alleges that, as LAPs' authorship of the Cabrera report started to come to light, LAPs attempted to "cleanse" the report by hiring the Weinberg Group ("Weinberg"), a consulting firm. Weinberg retained six experts, denigrated by Chevron, as "cleansing experts," who "cleansed" the Cabrera report by supposedly conducting their own analyses and submitting what the experts and Weinberg purported to be a new, independent report of the various types of environmental damage done by Chevron in Ecuador. [#1-1] at 5. According to Chevron, the "independence" of the "clean" report was a farce-all Donziger and his conspirators did was resubmit the findings of the Cabrera report in a seemingly different form. Instead of being based on fresh information and independent insights, the "clean" report was just the old Cabrera report in disguise. Id.; Complaint, ¶¶ 190-198.

Weinberg insists that the work of the six experts it retained was, in fact, independent. Chevron has taken their depositions and secured from them all the documents that they used or relied upon in creating their reports. Memorandum of Law in Opposition to Chevron Corp. Amended Motion to Compel the Weinberg Group to Produce Documents [#20] at 9-10. During those depositions, the experts Weinberg made available to Donziger and LAPs indicated that no one (such as Donziger or his alleged conspirators) assisted them, and that the conclusions they reached were their own. Id.

Chevron's case against Weinberg in the Southern District of New York asserts that Weinberg fits into the Donziger-led RICO conspiracy charge in two ways: 1) Weinberg retained the cleansing experts and led the cleansing effort; and 2) forensic analysis may establish that LAPs actually drafted the Ecuadorian judgment against Chevron and "Weinberg likely has versions of [] internal LAP documents [that were used in the Ecuadorian judgment] and possible knowledge about their use in the judgment-a central issue in the SDNY Action." [#1-1] at 2. By a subpoena issued pursuant to Federal Rule of Civil Procedure 45, Chevron demanded Weinberg produce these internal documents and others that may show Weinberg's involvement in procuring a fraudulent judgment in Ecuador. Id.

Initially, I concluded that certain of Judge Kaplan's findings in the SDNY action compelled the decision that any claim of privilege by Weinberg yielded to the crime/fraud exception. The reversal by the Second Circuit of Judge Kaplan's decision, containing the findings upon which my decision was based, led to the reversal of my opinion by the D.C. Circuit. See Chevron Corp., 682 F.3d at 98.

This brings us to where we are today. The motion to compel must be decided anew to ensure that Chevron has the documents it needs to move forward in its larger case. Although many documents were disclosed under my previous order granting Chevron's motion to compel, the documents to which Weinberg claimed a privilege were ordered, under an emergency motion by Weinberg, to be placed in a sealed container pending the outcome of this matter. Minute Order dated 6/25/12.

Now I must resolve whether these documents are properly withheld under a claim of privilege. Weinberg has produced a limited number of documents in full but claims work product or attorney-client privilege to many more. Chevron objects to Weinberg's claim of privilege, arguing that the materials are either not privileged in the first place, Memorandum in Support of Chevron Corporation's Amended Motion to Compel [#17] at 17-18, or if they are, the crime/fraud exception applies, id. at 10-12. Before any decision as to the crime/fraud exception can be reached, I must first decide which documents are, in fact, properly withheld under a legitimate claim of privilege.

ANALYSIS

I.The ...


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