Athletics Investment Group, LLC v. Schnitzer Steel Industries, Inc.

Background

This case is a citizen-enforcement lawsuit under the Clean Air Act concerning Schnitzer Steel Industries, Inc.’s operations at a metal-shredding facility in West Oakland. Athletics Investment Group, LLC served a subpoena on the Bay Area Air Quality Management District, a nonparty, seeking documents in 17 categories.

The District produced approximately 5,000 documents in January 2024 but withheld more than 9,300 documents based on asserted privileges and confidentiality agreements. It also redacted information from more than 900 documents as nonresponsive. Earlier orders addressed the District’s claims of deliberative-process privilege and law-enforcement or official-information privilege. After those rulings, the District asserted attorney-client privilege and work-product protection for 214 documents for the first time.

The parties narrowed the dispute to 67 documents. The District said 34 were partial or near duplicates of documents for which it had previously asserted attorney-client privilege or work-product protection. The remaining 33 had no alleged duplicates. The court ordered the District to submit the 34 documents and their alleged duplicates for review inside the court, without public access, and examined them.

Legal standard

Federal Rule of Civil Procedure 45 governs subpoenas to nonparties. A person withholding subpoenaed material as privileged or protected work product must expressly assert the claim and describe the withheld material well enough for the requesting party and the court to evaluate it. Under Ninth Circuit law, whether a late privilege assertion results in waiver depends on the circumstances, including the usefulness and timing of the privilege information, the size of the document production, and other circumstances affecting the difficulty of responding to discovery. The court applies those factors through an overall reasonableness analysis rather than an automatic rule.

Analysis

The court found that the District no longer claimed privilege over Documents 15 and 18. Of the remaining 32 paired documents, 16 were exact or nearly exact duplicates of documents for which the District had previously asserted privilege or work-product protection. Six other documents consisted of portions of longer email threads previously covered by those assertions. The court concluded that the District had not waived its claims for those 22 documents.

The other 10 documents were not complete duplicates because they included additional emails or email headers that had not previously been produced as part of the original threads. The court considered the nonduplicative portions of those 10 documents together with the 33 documents for which no duplicate was alleged, for a total of 43 documents.

The court concluded that the first two waiver factors favored waiver because the District did not assert privilege or work-product protection over those documents until June 2024, long after it received the subpoena and served its original privilege log. The court found that the delay hindered AIG’s ability to evaluate the claims.

The court found that the document-volume factor weighed somewhat in favor of waiver. Although the overall production was large, the District did not provide enough detail about the claimed difficulty of reviewing the documents, and the record suggested over-designation and an insufficiently careful review process. The court also found that the final factor weighed slightly in favor of waiver because the District asserted the new protections after losing its challenge to the deliberative-process privilege claims, which the court described as a second opportunity to assert protections.

Ruling

Judge Chesney granted in part AIG’s motion seeking a finding that the District’s late privilege and work-product assertions were waived. The court found waiver as to 43 documents and ordered the District to produce them by August 30, 2024. For Documents 1–3, 13, 21, 25, 29, 31, 33, and 34, the waiver applied only to email portions or headers that had not previously been produced; the District could redact portions of the original threads that it had previously withheld or redacted based on privilege.