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Arthur J. Gallagher & Co. v. O'Neill

United States District Court, E.D. Louisiana

November 27, 2017

ARTHUR J. GALLAGHER & CO.
v.
BRIAN D. O'NEILL

         SECTION “F” (2)

          ORDER AND REASONS

          JOSEPH C. WILKINSON, JR. UNITED STATES MAGISTRATE JUDGE

         The presiding district judge has affirmed in all respects my order of November 6, 2017, Record Doc. No. 89, but has “remanded for further consideration of the redactions in the documents not included in the in camera review.” Record Doc. No. 105 at p. 2 (emphasis added). Specifically, the remand order directs me to “address whether Marsh must amend the thousands of documents not included in the in camera sample to disclose the redacted information in compliance with the protective order, or whether Gallagher must accept the documents with the redactions in place.” Id. at pp. 1-2.

         (A) Timely Objections

         Before addressing the remand directive, I feel compelled to address Gallagher's misguided persistence in continuing to assert the erroneous argument that Marsh waived its objections to Gallagher's subpoena duces tecum by not asserting them within the 14 days provided in Fed.R.Civ.P. 45(d)(2)(B).[1] In short, I find Gallagher's waiver argument and the case law it cites to support it, Record Doc. No. 95-1 at pp. 9-12, erroneous and unpersuasive because they are contrary to the structure, plain meaning and intent of Rule 45. The analysis of the leading federal civil procedure commentators and the court decisions they rely upon, as outlined below, provide the correct interpretation of the interplay between the separate and distinct written objections and motion to quash procedural vehicles set out in Fed.R.Civ.P. 45(d)(2) and (3).

         When a non-party to a lawsuit, like Marsh, is served with an overly broad subpoena duces tecum, like the one served by Gallagher in this case, the non-party has four procedural options. First, it may ignore the subpoena. This is the worst option, almost certain to result in a contempt citation under Rule 45(g) and a finding that all objections have been waived. Second, the non-party may comply with the subpoena, an option that appears to be less frequently chosen in these contentious times.

         Third, the non-party “may serve on the party or attorney designated in the subpoena a written objection to inspecting, copying, testing, or sampling any or all of the materials or to inspecting the premises - or to producing electronically stored information in the form or forms requested.” Fed.R.Civ.P. 45(d)(2)(B)(emphasis added). Significantly, this rule uses the permissive “may.” It does not use the mandatory “shall” or “must.” The non-party is not required to serve written objections. Instead, serving written objections is a less formal, easier, usually less expensive method of forestalling subpoena compliance when compared to the separate option of filing a motion to quash or modify the subpoena, as discussed below. However, if the subpoena recipient chooses to serve written objections rather than file a motion to quash or modify, the objections must be served on the issuing party “before the earlier of the time specified for compliance or 14 days after the subpoena is served.” Id.

This fourteen-day objection period only applies to subpoenas demanding the production of documents, tangible things, electronically stored information, or the inspection of premises . . . . A failure to object within the fourteen-day period usually results in waiver of the contested issue. However, the district court, in its discretion, may entertain untimely objections if circumstances warrant.

9A C. Wright, A. Miller, M. Kane, R. Marcus, A. Spencer, A. Steinman, Federal Practice and Procedure § 2463 (3d ed. 2017)(hereinafter “Wright & Miller”)(available online).

         Thus, even untimely objections may be excused when, for example, a subpoena is overly broad on its face or places a significant burden on a non-party. See D. Lender, J. Friedmann, J. Bonk, Subpoenas: Responding to a Subpoena, 6 (Thomson Reuters 2013) (hereinafter “Lender”) (available at https://www.weil.com, search “subpoenas”) (citing Semtek Intern, Inc. v. Merkurly Ltd., No. 3607, 1996 WL 238538, at *2 (N.D. N.Y. May 1, 1996)). Moreover, as I have previously noted, Record Doc. No. 89 at pp.2-3, subpoenas duces tecum are discovery devices governed by Rule 45 but also subject to the parameters established by Rule 26. “[T]he court retains discretion to decline to compel production of requested documents when the request exceeds the bounds of fair discovery, even if a timely objection has not been made.” Schooler v. Wal-Mart Stores, Inc., No. CIV.A. 14-2799, 2015 WL 4879434, at *1 (E.D. La. Aug. 14, 2015) (citing Fifty-Six Hope Road Music, Ltd. v. Mayah Collections, Inc., No. 2:05-cv-01059-KJD-GWF, 2007 WL 1726558, at *4 (D. Nev. June 11, 2007); Lucero v. Martinez, No. 03-1128 JB/DJS, 2006 WL 1304945, at *2 (D.N.M. Mar. 11, 2006)).

         Serving written objections under Rule 45(d)(2)(B) may provide the recipient with several advantages. For example, asserting objections can be done informally without going to court, shifts the burden and expense of commencing motion practice in court to the issuing party and affords the recipient additional time in the event the recipient is ultimately obligated to comply with the demands in the subpoena. Lender, supra, at p.7.

         The non-party's fourth option is the one that Marsh elected to exercise in this case. Under Rule 45(d)(3), the subpoena recipient may move to modify or quash the subpoena as a means of asserting its objections to the subpoena. Unlike serving Rule 45(d)(2)(B) written objections, a motion to quash is not subject to the 14 day requirement. Instead, the rule provides simply that the motion to quash must be “timely.” Fed.R.Civ.P. 45(d)(3)(A). As the leading commentators and the case law they rely upon explain, the “14-day requirement to object to a subpoena is not relevant to a motion to quash a subpoena, . . .” Wright & Miller (emphasis added) and cases cited at n. 10, including COA Inc. v. Xiamei Houseware Group Co., Inc., No. C13-771 MJP, 2013 WL 2332347, *2 (W.D. Wash. May 28, 2013) (quoting King v. Fidelity Nat. Bank of Baton Rouge, 712 F.2d 188, 191 (5th Cir. 1983)); In re Kulzer, No. 3:09-MC-08 CAN, 2009 WL 961229 (N.D. Ind. Apr. 8, 2009), rev'd on other grounds Heraeus Kulzer, GmbH v. Biomet, Inc., 633 F.3d 591 (7th Cir. 2011) (motion to quash was timely even though it was not served within 14-day time limit).

         ““While ‘timely' is not defined in [Rule 45(d)(3)(A)] nor elaborated upon in the advisory committee notes . . . ., [i]n general, courts have read ‘timely' to mean within the time set in the subpoena for compliance.”” In re Ex Parte Application of Grupo Mexico SAB de CV for an Order to Obtain Discovery for Use in Foreign Proceeding, No. 3:14-MC-0073-G, 2015 WL 12916415, at *3 (N.D. Tex. Mar. 10, 2015) (quoting U.S. ex rel. Pogue v. Diabetes Treatment Ctrs of Am., Inc., 238 F.Supp.2d 270, 278 (D.D.C. 2002)) (citations omitted). “It is well settled that, to be timely, a motion to quash a subpoena must be made prior to the return date of the subpoena.” Estate of Ungar v. Palestinian Authority, 451 F.Supp.2d 607, 610 (S.D.N.Y. 2006) (emphasis added). In addition, “[c]ourts may excuse delay for the same reasons that justify delay in serving written objections, . . .” Lender, supra, at p. 9 (citations omitted).

         In this case, Gallagher apparently served its objectionable subpoena on May 19, 2017.[2] The return date provided in the subpoena for production of the documents was June 21, 2017. Marsh's motion to quash was filed on June 7, 2017, Record Doc. No. 10, two weeks before the return date. The motion was therefore timely within the meaning of Rule 45(d)(3)(A) and preserved Marsh's objections. Marsh did not employ the less formal alternative procedural option of serving written objections. ...


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