In Re Allergan PLC Securities Litigation

Background

The court considered letters from the parties describing five discovery disputes: (1) the scope of discoverable material; (2) whether defendants had to provide search-term hit counts; (3) information about the defendants’ organizational structure; (4) the period defendants had to search for documents; and (5) documents produced to government regulators.

The dispute concerned discovery relating to BIA-ALCL and the defendants’ knowledge of possible associations between breast implants and BIA-ALCL. The opinion refers to a class period running from January 30, 2017, through December 19, 2018.

Rulings

1. Scope of discovery. The court rejected the argument that a request was automatically too broad because it related to a dismissed claim. Documents relevant to dismissed claims could also be relevant to the remaining claim. The court also rejected limiting production to documents discussing BIA-ALCL incident rates; reports of specific incidents could be relevant to what Allergan knew about the connection between implants and BIA-ALCL. Documents generally discussing a connection between Allergan implants and ALCL could also provide circumstantial evidence of Allergan’s knowledge.

The court said production should focus on Allergan’s knowledge of associations between implants and BIA-ALCL. It noted that many requests appeared irrelevant, but the plaintiff’s letter did not identify the particular disputed requests or explain the disputes systematically. If the order did not resolve the matter, the parties had to confer again and identify each remaining request and their precise disagreement.

2. Search-term hit counts. The court said no dispute over the search terms themselves had been presented. The plaintiff had requested the number of results generated by searches defendants had run. The court required defendants, as part of negotiating search terms, to provide hit counts for searches using proposed terms, even if defendants believed those terms were improper. It stated that defendants had to provide as much information as possible about the search process and warned that insufficient disclosure could lead to waiver of arguments that reviewing the resulting documents would be too burdensome.

3. Organizational information. The plaintiff sought documents sufficient to show Allergan’s administrative organization and the divisions responsible for breast implants, BIA-ALCL, clinical studies, and reporting to the Food and Drug Administration. Defendants said the requested documents did not exist and that they had orally provided the substance of the information. The court said it could not require production of documents that did not exist. It nevertheless found it reasonable to require defendants to describe the relevant company divisions and the roles and functions of relevant employees, information the plaintiff could obtain through written questions or a deposition of a designated company representative. Defendants were directed to provide that information promptly.

4. Search period. Defendants had agreed to search back to 2016 and to search 2015 for documents concerning a March 2015 study. The plaintiff sought a full search of 2015. Because the search terms had not been finalized and the parties lacked information about the number of results and the burden of searching them, the court found that the search should extend through all of 2015 without restriction.

The parties had agreed to search for six months after the class period, ending June 19, 2019. The plaintiff sought an end date of July 31, 2019. The court directed defendants to search through July 31, 2019, noting the Food and Drug Administration’s July 24, 2019, recall of the defendants’ implants and stating that discovery is not limited to issues expressly raised in the pleadings.

5. Documents produced to regulators. The court found the apparent request for all documents relating to ALCL that defendants had produced to government regulators overbroad. However, documents responsive to other proper discovery requests had to be produced even if they had also been provided to regulators.

Disposition and effect

This was a discovery order, not a decision on the merits of the securities litigation. It set requirements and directions for the parties’ discovery process, including broader search dates, disclosure of search hit counts, and organizational information, while rejecting the request for every regulator-produced document as overbroad.