Arnold & Porter is ordered to pay more than $150K in sanctions for discovery 'poor judgment'
Image from Shutterstock.
Updated: A New York judge has ordered Arnold & Porter Kaye Scholer to pay more than $150,000 for failing to notify the state of New York of relevant late-discovered documents in opioid litigation and for other "discovery breaches."
Judge Jerry Garguilo of Suffolk County, New York, said Arnold & Porter had shown “neglect and poor judgment” when it submitted relevant late-found documents into a federal multidistrict litigation database without notifying the plaintiffs in a New York state opioid trial.
Law360 has the story on the Dec. 6 decision.
Arnold & Porter or its client, Endo Pharmaceuticals Inc., had found the documents—call notes by Endo Pharmaceuticals sales representatives—in May 2021 in a file where they were not expected to be, Garguilo said. He noted Arnold & Porter’s argument that it complied with a case management order that said documents produced in the national litigation should be treated as if produced in the New York litigation.
Arnold & Porter’s argument was technically correct, Garguilo said, “but as the cut-off date for disclosure was long past due, simply complying with [the case management order] was not sufficient.”
“This entire episode would have been avoided,” Garguilo said, if Arnold & Porter or Endo Pharmaceuticals “didn’t commit three mistakes and exercise poor judgment” after discovering the call notes.
Garguilo identified the mistakes as giving the document to a lawyer dealing with discovery issues in a Tennessee case, waiting until just before trial in the New York case to put the notes in the “national MDL discovery bin,” and failing to notify New York about the find.
Garguilo ordered Arnold & Porter to pay New York $125,000 for the time that it spent culling through the late-disclosed call notes and the preparation of its petition for fees and sanctions. He also ordered the law firm to pay $30,000 for other discovery issues.
Garguilo said he would not hold Arnold & Porter in contempt because it didn’t keep the data secret.
“If it was hiding or hidden, it was hidden in plain sight,” Garguilo said.
Garguilo noted that the state had in some instances sought an hourly fee rate of $1,800, which he deemed to be “patently unrealistic.” He also refused to require Arnold & Porter to pay a sanction to two other plaintiffs in the opioid litigation—Nassau County and Suffolk County—because they didn’t submit information on prevailing attorney-fee rates, the credentials of lawyers seeking reimbursement, and the hours devoted to the sanctions motion.
“The amount of any award for reasonable attorney’s fees cannot be plucked out of a hat or from thin air,” Garguilo wrote.
Arnold & Porter referred the ABA Journal’s request for comment to its lawyers at Steptoe & Johnson, Roger Warin and John O’Connor.
The lawyers released a statement that said Garguilo “rejected the hyperbolic accusations” in the sanctions motions filed by New York and the two counties.
“As Justice Garguilo’s decision notes, Arnold & Porter was forthright in acknowledging a few discrete mistakes in connection with discovery taking place in an exceedingly challenging litigation environment,” the statement said. “But Justice Garguilo did not accept the state’s and counties’ unsupported and reckless premise that Arnold & Porter or its clients engaged in intentional discovery misconduct.”
In fact, the statement said, Garguilo praised Arnold & Porter personnel for helping New York access various discovery materials. The statement also said the judge awarded less than 4% of what the state and the counties sought.
“While we do not agree with every statement in the court’s decision, we appreciate Justice Garguilo’s considerable efforts in digging into the voluminous motion papers, so that he could see through the state’s and counties’ false narrative regarding discovery in this case,” the statement said.
ABAJournal.com: “Arnold & Porter ‘slipped’ discovery documents into database without notice, referee says”
Updated Dec. 8 at 2:55 p.m. to add information from Arnold & Porter Kaye Scholer’s statement.