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Court Finds Judicial Duty to Manage Discovery

Rebecca Love Kourlis Posted in Featured, Informed Opinions, Rule One

Unlimited and unmanaged discovery in civil lawsuits can be extremely expensive—and sometimes wholly out of proportion to the needs of the case. In a landmark decision issued this week, the Colorado Supreme Court put the brakes on discovery run amuk and clarified the duty of the trial court judge to manage the discovery in the case—at a minimum by considering the cost-benefit and proportionality factors set forth in C.R.C.P. 26(b)(2)(F).

Across the nation, state and federal judges, attorneys, and parties have been struggling with how to put the discovery genie back in the bottle—to assure that parties get the information they reasonably need to litigate their case, but to eliminate the hammer effect of excessive discovery in driving up costs and encouraging one or both parties to throw in the towel on the litigation.

The scenario is that one party to a lawsuit requests millions of pages of paper and electronic documents during discovery, or dozens of depositions, or both. The other side objects, arguing that the requests are overbroad and unduly burdensome. In the past, judges were inclined to throw up their hands—sometimes even claiming that the parties were being churlish or unprofessional, and then the judges would allow the discovery.  In fairness to the trial courts, those judges feared that they would be reversed on appeal if they cracked down on discovery—and furthermore, the issues seldom actually have made it to the appellate stage because once the discovery is permitted and the parties face the burgeoning costs, the likelihood of settlement goes up.

The Colorado Supreme Court tackled this scenario head on in an opinion this week in In re: DCP Midstream, LLP v. Anadarko Petroleum Corporation. The Court held that not only does the trial judge have the power to take an active role in determining the appropriate level of discovery for the case, the trial judge is required to do so under the rules. According to the opinion, under Colorado Rule of Civil Procedure 26(b)(1), which mirrors its federal rule counterpart, when a dispute about the proper scope of discovery arises, “the trial court must determine the appropriate scope of discovery in light of the reasonable needs of the case and tailor discovery to those needs.”

In the case, Plaintiff DCP Midstream, LP asserted eleven breach of contract claims against Anadarko Petroleum Corporation in its complaint, but also stated it anticipated adding additional claims after conducting discovery.  DCP then sent Anadarko fifty-eight requests for production seeking millions of pages of paper and electronic documents. When Anadarko refused to produce many of the requested documents, DCP filed a motion to compel production. Anadarko argued that many of the requests were not relevant to the breach of contract claims pleaded in the complaint, bringing it outside the scope of permitted discovery under C.R.C.P. 26(b)(1), which allows the parties to obtain discovery regarding any matter relevant “to the claim or defense.”  The trial court recognized that the plaintiff was “hunting,” but determined that Anadarko was “on notice” that such broad discovery was allowed, and that the court did not have the power to narrow discovery.  To the contrary, the Supreme Court held that, not only does the trial court have the power, it has the duty.

The Court reminded the parties, the judge, and every other participant in the civil justice system that the purpose of our civil rules, as expressed in Rule 1 of the Colorado and Federal Rules of Civil Procedure, is “the just, speedy, and inexpensive determination of every action.” The court recognized that delay and excessive discovery costs can limit access and force unwanted settlements. Active judicial management plays a critical role in addressing these problems, “and our rules have evolved to stress this principle.”

Update: The following outlets have covered the case and quoted Rebecca Love Kourlis’ analysis of the impacts: The Wall Street Journal and the ABA Journal.