Export Development Canada v. East Coast Power & Gas, LLC

Background

Export Development Canada moved under Federal Rule of Civil Procedure 37 for monetary sanctions—fees and expenses—after successfully compelling East Coast Power & Gas, LLC to produce the Kowal Report. The opinion says East Coast had improperly identified the report on its privilege log and withheld it as privileged. A prior order required production, and the report was produced after a fifteen-month delay.

Arguments and analysis

Rule 37 generally requires payment of the moving party’s reasonable fees and expenses when a motion to compel is granted. The rule provides exceptions when the moving party did not make required efforts to resolve the dispute beforehand, the opposing party’s nondisclosure or objection was substantially justified, or other circumstances would make an award unjust.

The court found that East Coast’s response did not establish any of those exceptions. East Coast did not justify its positions concerning the Kowal Report and did not identify circumstances making an award unjust. The court rejected East Coast’s argument that its status as a judgment debtor with reportedly no assets and only one full-time and two part-time employees made an award unjust. The court also found that East Coast’s claim that Export Development Canada had not met and conferred was conclusory and contradicted by the record.

The court further rejected East Coast’s argument that Export Development Canada had not been prejudiced by the delay. It explained that prejudice is not required for Rule 37 sanctions and that unnecessary legal fees incurred while pursuing information that should have been produced can itself support an award.

Ruling and next steps

The court granted Export Development Canada’s motion for fees and expenses insofar as Export Development Canada may recover fees and expenses specifically associated with compelling production of the Kowal Report. The ruling does not authorize recovery for all issues involving deficiencies in East Coast’s privilege log.

Within 14 days after entry of the order, Export Development Canada must file a brief of no more than five pages and a declaration with time records supporting the extent and amount of fees and expenses sought. East Coast may respond within 14 days after service of those materials. The Clerk was directed to terminate the letter motions at Dkt. 101 and 102.