Case of the Day: Chevron Corp. v. Shefftz
Posted on May 26, 2011
We return to the Lago Agrio case with today’s case of the day, Chevron Corp. v. Shefftz (D. Mass. 2010). In this installment, Chevron sought leave to depose and take other discovery from one of the authors of the expert reports the plaintiffs submitted in the Lago Agrio case, Jonathan S. Shefftz. Chevron was seeking to prove that the Shefftz report relied on the report submitted by Richard Stalin Cabrera Vega, the court-appointed “global damages expert,” which, in Chevron’s view, had been discredited, and that the Shefftz report itself should not be credited.
Judge Tauro found that the statutory requirements for invocation of § 1782 were met, and in particular, that the BIT arbitral tribunal was a “tribunal” for purposes of the statute. All four Intel factors weighed in favor of allowing the discovery. The judge’s description of the third factor—whether Chevron was attempting to circumvent foreign proof-gathering restrictions—was especially clear: the issue isn’t whether the Ecuadorian court would “bless” Chevron’s efforts to obtain the evidence, but whether the discovery was being sought in bad faith.
The judge held that the limitation in Fed. R. Civ. P. 30 on the number of depositions that could be taken without leave of court did not apply to depositions taken in multiple § 1782 proceedings in multiple districts. This is the same conclusion reached in In re Chevron Corp., the case of the day for May 13.
The judge refused to apply the crime-fraud exception to pierce the attorney-client privilege between Shefftz and his lawyer, finding that Chevron had not shown that Shefftz was engaged in or was planning criminal or fraudulent activity. Although Shefftz’s report cited and relied upon Cabrera’s report, the judge took that citation as “an act of transparency that allowed [Chevron] to quickly ascertain [Shefftz’s] reliance upon the Cabrera report and investigate it through discovery.” Nor was there any evidence that Shefftz knew of any alleged fraud in the Cabrera report.