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Stafford v. Stanton

United States District Court, W.D. Louisiana, Shreveport Division

August 13, 2019

RAYMOND STAFFORD
v.
WALTER J. STANTON, III, ET AL

          HICKS CHIEF JUDGE

          MEMORANDUM ORDER

          MARK L. HORNSBY U.S. MAGISTRATE JUDGE

         Introduction

         Raymond Stafford (“Plaintiff”) sued attorney Walter J. Stanton, III, David deBarardinis and Financial Resources, LLC, for their alleged involvement in a Ponzi scheme that defrauded Plaintiff of approximately $2.75 million. Plaintiff filed an amended complaint that named as defendants Berkley Assurance Co. and National Union Fire Insurance Co. of Pittsburgh PA, Stanton's professional liability insurers. In May 2019, Berkley served on Carney Stanton, Walter Stanton's law firm, a subpoena for documents relating to Stanton's and the firm's attorney representation of deBerardinis, individually and on behalf of his companies.

         Before the court is Walter Stanton's Motion to Quash Subpoena and for Protective Order (Doc. 94), which seeks to quash the subpoena on several grounds, including procedural defects, undue burden, attorney-client privilege, and attorney work product privilege. For the reasons that follow, the motion is denied.

         Applicable Law

         Fed. R. Civ. P. 45 governs the issuance of subpoenas to obtain discovery from non-parties. The party issuing the subpoena “must take reasonable steps to avoid imposing undue burden or expense on a person subject to the subpoena.” Fed.R.Civ.P. 45(d)(1). “On timely motion, [a] court. . . must quash or modify a subpoena” if it “requires disclosure of privileged or other protected matter, if no exception or waiver applies” . . . or otherwise “subjects [the subpoenaed] person to undue burden.” Rule 45(d)(3)(A)(iii)-(iv). The moving party bears the burden of demonstrating that compliance with a subpoena would be unduly burdensome. See Wiwa v. Royal Dutch Petroleum Co., 392 F.3d 812, 818 (5th Cir. 2004).

         A subpoena issued for discovery purposes is also subject to the discovery limitations of Fed.R.Civ.P. 26(b). See Jones v. Steel Fabricators of Monroe LLC, 2015 WL 5676838, *3 (W.D. La. 2015), report and recommendation adopted, 2015 WL 6023143 (W.D. La. 2015). Rule 26(b)(1) allows discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case.

         Rule 26(b)(1) lists the following factors to consider when assessing whether the discovery sought is proportional to the needs of the case: (1) the importance of the issues at stake in the action, (2) the amount in controversy, (3) the parties' relative access to relevant information, (4) the parties' resources, (5) the importance of the discovery in resolving the issues, and (6) whether the burden or expense of the proposed discovery outweighs the likely benefit.

         Rule 26(b)(2)(C) requires the court to limit discovery if (1) it is unreasonably cumulative or duplicative, or can be obtained from some other source that is more convenient, less burdensome, or less expensive; (2) the party seeking discovery has had ample opportunity to obtain the information by discovery in the action; or (3) the proposed discovery is outside the scope permitted by Rule 26(b)(1).

         The Subpoena

         The subpoena was addressed to the law firm Carney Stanton. It requested five categories of documents: (1) bills submitted to deBerardinis or any of his companies for services rendered by Carney Stanton in connection with dealing with Plaintiff or any other investor or potential investor during the years 2014, 2015, or 2016; (2) communications during the years 2014, 2015, or 2016 between Carney Stanton and deBerardinis or any other agent of any of his companies concerning Plaintiff or any other investor or potential investor; (3) promissory notes, contracts, corporate documents, bank records or promotional advertising material relating to deBerardinis or any of his companies that Carney Stanton provided to Plaintiff or any other investor or potential investor during the years 2014, 2015, or 2016; (4) documents prepared, revised, or reviewed by Carney Stanton on behalf of or in furtherance of the fuel trading business of deBerardinis or any of his companies during the years 2014, 2015, or 2016; and (5) documents collected from Carney Stanton's servers for inspection and copying pursuant to the Collection Protocol Agreement dated February 13, 2018.

         Standing

         Berkley argues that Walter Stanton does not have standing to challenge the subpoena. The subpoena was directed to the law firm Carney Stanton. Berkley asserts that, under Annie Sloan Interiors, Ltd. v. Jolie Design & Décor, Inc., 2018 WL 6624208, *2 (E.D. La. 2018), persons to whom a subpoena is not directed lack standing to challenge a subpoena served on a third party. Berkley also suggests that Walter ...


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