Asset Funding Group, LLC v. Adams and Reese, LLP, No. 2:2007cv02965 - Document 346 (E.D. La. 2009)
Court Description: ORDER re 307 Motion to Stay Effect of Order and Reasons (Rec. Doc. No. 305) Pending Appeal and Alternative Motion for Extension of Time for Compliance. The motion to stay is DENIED and the alternative motion for an extension to comply is GRANTED, extending the current compliance deadline to 8/10/2009. Signed by Judge Ivan L. R. Lemelle. (gec, )
Download PDF
<![CDATA[
Asset Funding Group, LLC v. Adams and Reese, LLP Doc. 346 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA ASSET FUNDING GROUP, LLC, et al CIVIL ACTION VERSUS NO. 07-2965 SECTION: “B”(4) ADAMS AND REESE, LLP ORDER AND REASONS Before the Court is Defendant’s Motion to Stay Effect of Order and Reasons of June 5, 2009 (Rec. Doc. No. 305) Pending Appeal and Alternative Motion for Extension of Time for Compliance (Rec. Doc. No. 307). For the following reasons, the motion to stay is DENIED and the alternative motion for an extension to comply is GRANTED, extending the current compliance deadline to August 10, 2009. BACKGROUND This Group is and a its diversity action affiliate filed companies by Asset Funding (Plaintiffs), a California-based company, against its former law firm Adams & Reese (Defendant), a Louisiana limited liability partnership. Defendant was retained by Plaintiff to represent them against their former attorney, Jeffer Mengels. Defendant 1 Dockets.Justia.com was also retained to represent Plaintiff against Evans Industries, Inc., (Evans), which declared bankruptcy while leasing properties from Plaintiff. time also represented Grief Services, L.L.C. (Grief). Grief with its later Defendant during this Industrial & Packaging Defendant advised and assisted purchase auction. (Rec. Doc. 207). of Evans’ interest at Plaintiffs allege that Defendant failed to timely inform them of a conflict of interest, and thus provided substandard and negligent representation and breached its fiduciary duties. (Rec. Doc. No. 6). During Request for whether a pretrial proceedings, Production conflicts of check Plaintiffs documents which occurred; filed a “demonstrates and/or pertain to Grief’s interest in assuming the Master Lease Agreement.” (Rec. Doc. No. 6). were overruled Federal Rules implications by of of Defendant filed its objections, which the Civil Court as non-compliant Procedure. another However, client’s with the given the information being revealed, the Magistrate Judge allowed Defendant to submit a privilege log (Rec. Doc. No. 80). the Magistrate Judge ordered On August 27, 2008, specific documents in the privilege log to be produced, ruling that these documents were not protected by attorney-client privilege (Rec. Doc. 2 No. 145). Defendant subsequently appealed that ruling (Rec. Doc. No. 165-2). On November Magistrate 17, Judge’s 2008, this Order. Court (Rec. affirmed Doc. No. the 204). Subsequently, on December 1, 2008, Magistrate Judge Roby ruled upon the remaining documents, which she previously had taken under advisement. Magistrate Judge Roby held that attorney-client privilege did not shield the in-house communications in Defendant’s privilege log. Id. at 15. In response, Reconsideration of Defendant this Court’s filed a November Motion for 2008 Order 17, (Rec. Doc. No. 204); Motion for Appeal of Magistrate Judge Roby’s December 1, 2008 order (Rec. Doc. No. 207); and Motion for 210). However, on June 5, 2009, this Court denied all Defendant’s Defendant certificate motions, to produce of Appealability (Rec. Doc. No. communication (Rec. 305) between and Doc. No. ordered Defendant’s attorneys and Defendant’s in-house counsel pertaining to Defendant’s attorneys’ compliance with their ethical duties (Rec. Doc. No. 307-3). Defendant subsequently filed a Notice of Appeal of the June 5, 2009 Order pursuant to 28 U.S.C. § 1291 and filed the instant Motion to Stay the effect of the June 5th Order pending the Fifth Circuit’s ruling, or alternatively extend 3 the time for compliance with that Order until resolution of Defendant’s appeal. (Rec. Doc. No. 307). DISSCUSION Generally, discovery orders are not final orders of the district court for purposes of obtaining jurisdiction under 28 U.S.C. § 1291. appellate A final decision is one that “ends the litigation on the merits and leaves nothing more for the court to do but execute the judgment.” Digital Equip. Corp. v. Desktop Direct, Inc., 511 U.S. 863, 867 (1994). Discovery orders therefore, do not constitute final decisions under §1291 and are not appealable. Church of Scientology (1992). v. United States, 506 U.S. 9, 18 n.11 However, the collateral order doctrine, enunciated by the Supreme Court in Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541 (1949), provides that a “trial court order is an appealable §1291 ‘final decision’ when it represents ‘a final disposition of a claimed right which is not an require ingredient of consideration the cause with it’ of and action which and does presents not ‘a serious and unsettled question’ of law.” Southern Methodist Univ. Ass’n of Woman Law Students v. Wynne & Jaffe, 599 F.2d 707 (5th Cir. 1979). Cohen, 337 U.S. at 546. The collateral order doctrine “is best understood not as an exception to the ‘final decision’ rule laid down by 4 Congress in §1291, but as a ‘practical construction’ of it.” Digital Equip. Corp. v. Desktop Direct, Inc., 511 U.S. 863, 867 (1994)(quoting Cohen, 337 U.S. at 546). To qualify as an arguable collateral order under Cohen, an order must question; separate (1) (2) from conclusively resolve the an merits determine important of the the issue action; disputed completely and (3) be effectively unreviewable on appeal from a final judgment. Coopers & Lybrand v. Livesay, 437 U.S. 463, 468 (1978). However, jurisdiction will not be available under the collateral order doctrine unless all three requirements are met. Gulfstream Aerospace Corp. v. Mayacamas Corp., 485 U.S. 271, 276 (1988). Defendant argues that the challenged discovery order is an appealable “collateral order” under Cohen. While the challenged discovery order would likely meet the first and second requirements of the Cohen test, it fails to meet the third requirement. The first requirement is satisfied because the Court’s order conclusively determined that the communication between Defendant’s attorneys and Defendant’s in-house counsel is not protected by the attorney-client privilege. (Rec. Doc. No. 305). also satisfied. important privilege The The second requirement is attorney-client that protects 5 privilege certain is an disclosures between Court attorneys found material and the of clients. Additionally, documents are present case. specific important resolution their the to the privilege and the discoverable Further, discovery issues is completely separate from and does not decide the merits of the case. As for the third requirement, the Court does not find that the client discovery privilege order would that be implicates effectively appeal from a final judgment. the attorney- unreviewable on If the Fifth Circuit were to find that privileged information was wrongly turned over to Plaintiffs and was used to the detriment of Defendant at trial, the Fifth Circuit has the authority to reverse any adverse judgment and require a new trial, forbidding any use of the improperly disclosed documents. Boughton, et al., v. Cotter Corp, 10 F.3d 746, 749 (10th Cir. 1993). Additionally, Plaintiffs “would also be forbidden to offer any documents, witnesses, or other evidence obtained as a consequence of their access to the privileged documents.” Id. Furthermore, the Fifth Circuit has held that discovery orders “do not constitute final decisions” for the purposes of §1291 and “are not appealable under the Cohen collateral order doctrine.” Wiwa v. Royal Dutch Petroleum Co., 392 6 F.3d 812, 815 Galleries, (5th Inc. v. Cir. 2004). American See Numismatic A-Mark Assoc., Auction 233 F.3d 895, 899 (5th Cir. 2000) (restating the general rule that it is well-settled that in this circuit, discovery orders may not be appealed under the Cohen exception). In seeking a stay pending appeal, Defendant must show (1) that it has a substantial likelihood of success on the merits; (2) that it will suffer irreparable injury if the stay is denied; (3) that issuance of the stay will not cause substantial harm to other parties; and (4) whether granting of the stay would serve the public interest. Drummond v. Fulton County Dep’t of Family and Children’s Services, Bading, 532 2008 F.2d 1001, WL 1002 194350, (5th *1-2 Cir. 1976); (Bkrtcy. In W.D. re Tex. 2008)(citing In re First South Sav. Ass’n, 820 F.2d 700, 704 (5th Cir. 1987)). Defendant has not satisfied the Drummond criteria warranting a stay of proceedings pending the interlocutory appeal. (Rec. Doc. Court’s order is No. 307). appealable Defendant under argues Cohen and that the that the privilege between Defendant’s attorneys and Defendant’s inhouse counsel pertaining to compliance with ethical duties, once revealed, can never again be concealed. (Rec. Doc. No. 307-3 at 4). However, as previously stated, if the Fifth 7 Circuit was to find that privilege information was wrongly turned over to the Plaintiff and was used to the detriment of Defendant at trial, the Fifth Circuit has the authority to reverse any adverse judgment and require a new trial, forbidding any use of improperly Boughton, 10 F.3d at 749. authority has found that, disclosed documents. Furthermore, “The weight of even the risk an appeal may become moot is not an irreparable injury.” In re Kummer, 2009 WL 73252, *2 (D.Nev. 2009). Thus, to avoid undue prejudice to Defendant’s ability to file and timely comply with the subject orders, Defendant’s extended until August 10, 2009. For the foregoing time to comply is Accordingly, reasons, IT IS ORDERED that Defendant’s Motion to Stay is DENIED and the alternative motion for an extension to comply is GRANTED, extending the current compliance deadline to August 10, 2009. New Orleans, Louisiana, this 31st day of July, 2009. IVAN L.R. LEMELLE UNITED STATES DISTRICT JUDGE 8
]]>
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You
should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
