In the case In re Firstenergy Corp. Sec. Litig., No. 2:20-cv-3785 (S.D. Ohio March 24, 2023), Ohio Magistrate Judge Kimberly A. Jolson ordered non-party Partners for Progress, Inc. (PFP) to perform additional search terms requested by movants and bear the costs of the associated production. Judge Jolson also ordered PFP and movants to negotiate search terms for relevant Calfee, Halter & Griswold (Calfee) law firm custodians representing PFP and granted PFP’s request to enter a Rule 502(d) Order to protect against waiver of privilege.

Case Discussion

In this case involving a corruption and bribery scheme involving two nuclear power plants, a Joint Motion to Compel was brought by plaintiffs and defendant Michael Dowling (Movants), who asked the Court to compel the production of documents which non-party PFP had withheld or redacted on the basis of attorney-client privilege. Additionally, they claimed that PFP’s production thus far had been deficient in two regards: (1) it employed a limited search-term protocol to identify responsive documents; and (2) it failed to search for documents which were created or received by the attorneys at Calfee representing PFP.

In November 2022, the Court ordered PFP to supplement its limited initial production to Movants’ subpoenas, and by December 7, PFP made its supplemental production, and—after inquiry from Movants—explained its search protocol. Movants then responded with purported deficiencies in the search protocol, including the failure to search Calfee custodians and under-inclusive search terms. Movants proposed additional search terms, but PFP refused to perform the search with these additional terms unless Movants paid the costs associated with the search. And PFP renewed earlier objections that searching Calfee custodians would be unduly burdensome and would result only in privileged material.

Movants stated the search-term protocol employed by PFP was insufficient; notably, it “failed to include ‘FirstEnergy’ (along with variations) as a stand-alone search term.” PFP argued that these additional terms would result in “over 1,000 unique additional documents to review, which will impose significant additional costs on PFP”. PFP also argued that the Court shouldn’t enforce the additional search terms because they were only raised after the supplemental production was made, stating if the Court did enforce the search terms, it should shift the costs of the corresponding search and review to Movants, under FRCP Rule 45(d)(2)(B)(ii).

Judge’s Ruling

Judge Jolson stated that “the Court does not find, as PFP suggests, that Movants are solely responsible for the belated conferral on the search protocol. Ideally, both the requesting parties and the responding party would have conferred on search terms before the initial search and review was conducted. But having been presented with the search protocol only after the supplemental production was made, Movants were warranted in raising their concerns with the protocol’s design.”

Judge Jolson also stated: “the Court finds there are legitimate concerns about deficiencies in PFP’s protocol, and the proposed search terms reasonably address those concerns”. She cited a couple of examples, including that “no variant of ‘FirstEnergy’ was included as a search term” and stated “the omission of several at-issue organizations from the original set of search terms is patently deficient.”

As for shifting the costs, Judge Jolson stated: “the Court does not find that Movants should bear any of the costs of production”, noting “Both PFP’s own interest in the outcome of the case and the public importance of the litigation weigh against mitigation of PFP’s compliance expenses. As the Court has previously observed, PFP was funded and controlled by FirstEnergy Corp. (‘FirstEnergy’), the first named Defendant in this action…And now, PFP maintains that it shared a common legal interest with FirstEnergy…It follows that its interest in the outcome of this litigation is greater than that of a usual non-party, and the need for cost mitigation—an appropriate protection for a disinterested non-party—is lesser.” She also noted: “Similarly, this litigation is of public importance. This is a class action comprising potentially thousands of Plaintiffs who say they were harmed by FirstEnergy’s participation in ‘one of the largest corruption and bribery schemes in U.S. history.’…PFP has an obligation to the public and a particular obligation to potential class members to fairly and fully disclose the non-privileged information within its possession, custody, or control.”

As a result, Judge Jolson ordered PFP to perform additional search terms requested by movants and bear the costs of the associated production.

Additionally, recognizing concerns from both the movants and PFP regarding Calfee custodians, Judge Jolson ordered PFP and movants “to negotiate search terms for relevant Calfee custodians and file a notice on the public docket of the agreed-upon search terms on or before March 31, 2023.” And she granted PHP’s request that the Court enter an order under Rule of Evidence 502(d), which will allow it to produce disputed Calfee invoices and certain emails to Movants with fewer redactions without waiving privilege.

So, what do you think? Should the Court have ordered a non-party to perform additional search terms and pay for them? Or should they not be treated like other non-parties. Please share any comments you might have or if you’d like to know more about a particular topic.

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