Petro Indus. Sols. v. Island Project & Operating Servs.

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PETRO INDUSTRIAL SOLUTIONS, LLC, Plaintiff, v. ISLAND PROJECT & OPERATING SERVICES, LLC, VITOL U.S. HOLDING II, CO., VITOL VIRGIN ISLANDS CORP., ANDREW CANNING, OPTIS EUROPE, LTD., Defendants.

No. 1:21-cv-00312-WAL-EAH

United States District Court, D. Virgin Islands, St. Croix Division

June 7, 2023

Lee J Rohn, Esq.

On behalf of Plaintiff

Simone D. Francis, Esq.

On behalf of Island Project & Operating

Andrew Kaplan, Esq.

Gloria Park, Esq.

Sarah Hannigan, Esq.

Carl A. Beckstedt, III, Esq.

On behalf of Vitol U.S. Holding and Vitol VI

Andrew C. Simpson, Esq.

On behalf of Andrew Canning & OPTIS Europe

ORDER

EMILE A. HENDERSON III U.S. MAGISTRATE JUDGE

THIS MATTER comes before the Court on the Motion to Compel OPTIS Europe, Ltd. to Supplement Its Responses to Plaintiff's Written Discovery, Dkt. No. 199, filed by Plaintiff, Petro Industrial Solutions, LLC (“Petro”). OPTIS filed an opposition, Dkt. No 207, and Petro filed a reply, Dkt. No. 210. For the reasons that follow, the Court will grant in part and deny in part the motion to compel.

BACKGROUND

In October 2022, Petro filed a First Amended Complaint against Island Project & Operating Services, LLC (“IPOS”), Vitol U.S. Holding II, Co., Vitol Virgin Islands Corp. (“VVIC”), Andrew Canning and OPTIS. Dkt. No. 112. OPTIS entered into a consulting agreement with VVIC to manage, in conjunction with IPOS, the operation of the Randolph Power Plant (on St. Thomas) and the Richmond Power Plant (on St. Croix) by implementing maintenance activities and special projects. Id. ¶ 11. OPTIS was the “direct employer” of Canning, id. ¶ 12, who was described as a “consulting engineer for VITOL Defendants through a contract between [sic] Optis Europe, Ltd.“ Id. ¶ 6. Petro was “a company made up of all local West Indian or local Hispanic employees, as are its management team and owners.” Id. ¶ 14.

Petro and IPOS entered into a contract in September 2019 for Petro to perform preventive and remedial maintenance, scheduled projects, and provide equipment rentals and material procurement. Id. ¶ 17. Canning had to approve budgets and actions of Petro. Id. ¶ 20. He held a racist attitude toward Petro and, when Petro employees pointed out that his decisions were in error, he became enraged, retaliatory and made false accusations so that IPOS and the Vitol Defendants would cancel the contract. Id. ¶¶ 21, 22. Canning prevented Petro from receiving a particular bid, id. ¶ 32, and starting in January 2021, the Vitol Defendants, through Canning, began to withhold payments on Petro's account receivables and kept it from being paid, id. ¶ 37. Numerous disputes erupted, including one over the certification of Petro's welders, id. ¶¶ 63-69, which led to IPOS cancelling its service contract with Petro, at the insistence of Vitol and Canning in July 2021, id. ¶ 70. In August 2021, IPOS cancelled Petro's equipment rental contract. Id. ¶ 74. The Amended Complaint charges that OPTIS tortiously interfered with Petro's contract with IPOS and defamed Petro. Dkt. No. 112 ¶¶ 85, 88. It also alleges a violation of the Virgin Islands discrimination statutes, tortious interference, and defamation against Canning, id. at ¶¶ 6, 82, 85, 88.

On January 25, 2023, Petro propounded its first set of interrogatories and its first demand for production of documents on Defendant OPTIS. Dkt. Nos. 140, 141; Dkt. No. 1991. On March 1, 2023, Petro's counsel wrote to OPTIS's counsel detailing Petro's view that certain interrogatory and request for production responses were insufficient. Dkt. No. 1992. On March 9, OPTIS's counsel responded that it would supplement its discovery responses by March 16. Dkt. No. 199-3. Not having received the supplemental responses, Petro's counsel wrote OPTIS's counsel on March 24 requesting the supplemental responses or dates to meet and confer. Id. On March 27, OPTIS indicated that it was working to provide the supplemental responses. When Petro did not receive those responses, it wrote the Court on April 6, 2023 stating that it had reached an impasse with the OPTIS discovery responses and requesting an informal conference for the Court to assist in resolving these issues.

The Court held the informal conference on May 12, 2023. Some of the outstanding interrogatory and demand for production issues were resolved and others were to be resolved through supplementation by OPTIS. However, the majority of the requests for production and interrogatories about which Petro had requested the Court's intercessions in resolving were not resolved. Petro stated that it would file a motion to compel. The Court provided briefing deadlines. Dkt. No. 196. Petro then filed the instant motion to compel, Dkt. No. 199, OPTIS filed an opposition, Dkt. No. 207, and Petro filed a reply, Dkt. No. 210.

DISCUSSION

I. Applicable Standards

A. Discovery Under Rule 26

Federal Rule of Civil Procedure 26(b)(1), concerning discovery scope and limits, provides, inter alia:

Unless otherwise limited by court order, the scope of discovery is as follows: Parties may obtain discovery regarding any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case, considering the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit. Information within this scope of discovery need not be admissible in evidence to be discoverable.

Fed. R. Civ. P. 26(b)(1). Matters of discovery are committed to the broad discretion of the court, United States v. Washington, 869 F.3d 193, 220 (3d Cir. 2017). The Third Circuit recently described the Rule's relevancy standard as “undemanding,” noting that courts “employ a liberal and broad discovery-type standard which requires only the probability that the desired information is relevant.” Crozer Chester Med. Ctr. v. Nat'l Lab. Rels. Bd., No. 22-2608, 2023 WL 3018280, at *2 (3d Cir. Apr. 20, 2023); see also Birl v. Ski Shawnee, Inc., No. 3:22-cv-1598, 2023 WL 3743576, at *2 (M.D. Pa. May 31, 2023) (quoting Jackson v. Beard, No. 11-1431, 2014 WL 3868228, at *5 (M.D. Pa. Aug. 6, 2014) for the proposition that “[a]lthough the scope of relevance in discovery is far broader than that allowed for evidentiary purposes, it is not without its limits.”) (internal quotation marks omitted)).^[1]

Because assertion of a claim of privilege “may result in the withholding of relevant information and so may obstruct the search for truth,” In re Chevron Corp., 633 F.3d 153, 164 (3d Cir. 2011), it is well established that “‘[t]he burden of proving that the . . . privilege applies is placed upon the party asserting the privilege.'” Matter of Grand Jury Empanelled February 14,1978, 603 F.2d 469, 474 (3d Cir. 1979) (quoting United States v. Landof, 591 F.2d 36, 38 (9th Cir. 1978)); see also Hydrojet Servs., Inc. v. Sentry Ins. Co., No. CV 20-4727-SWR, 2022 WL 2168655, at *2 (E.D. Pa. June 16, 2022) (“the party must specifically show how the asserted privilege applies.”). Rule 26 requires the party withholding information on the basis of privilege to “describe the nature of the documents, communications, or tangible things not produced or disclosed-and do so in a manner that, without revealing information itself privileged or protected, will enable other parties to assess the claim.” Fed.R.Civ.P. 26(b)(5)(A)(ii). Failure to assert the privilege properly, in conformity with the Federal Rules, results in waiver of any and all objections based upon attorney-client privilege and/or attorney work-product doctrine. Monterey Commc'ns, LLC v. Atl. Tele-Network Int'l, Inc., No. 1:19-cv-00015, 2021 WL 7707265, at *5 (D.V.I. Apr. 22, 2021).

The work product privilege “shelters the mental processes of the attorney, providing a privileged area within which he can analyze and prepare his client's case.” In re Cendant Corp. Sec. Litig., 343 F.3d 658, 661-62 (3d Cir. 2003). It is governed by a uniform federal standard embodied in Federal Rule of Civil Procedure 26(b)(3). United Coal Cos. v. Powell Const. Co., 839 F.2d 958, 966 (3d Cir. 1988). Work product is defined as “tangible things that are prepared in anticipation of litigation or for trial by or for another party or its representative (including the other party's attorney, consultant, surety, indemnitor, insurer, or agent).” Fed.R.Civ.P. 26(b)(3).

In a diversity action that raises state claims, such as this case, Virgin Islands law governs the applicability of the attorney-client privilege. Fed.R.Evid. 501; Montgomery Cnty. v. MicroVote Corp., 175 F.3d 296, 301 (3d Cir. 1999). Section 852 of Title 5 of the Virgin Islands Code governs attorney-client privilege in the Virgin Islands:

A client has a privilege to refuse to disclose and to prevent any other person from disclosing confidential communications made for the purpose of facilitating the rendition of professional legal services to the client (1) between the client or the client's representative and the client's lawyer or the lawyer's representative, (2) between the client's lawyer and the lawyer's representative, (3) by the client or the client's representative or the client's lawyer or a representative of the lawyer to a lawyer or a representative of a lawyer representing another in a matter of common interest, (4) between representatives of the client or between the client and a representative of the client, (5) among lawyers and their representatives representing the same client. This privilege exists whether the person/client actually retains the lawyer or law firm to render professional legal services

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