Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_05-cv-04826/USCOURTS-cand-5_05-cv-04826-3/pdf.json

Nature of Suit Code: 410
Nature of Suit: Antitrust
Cause of Action: 15:1 Antitrust Litigation

---

U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

ORDER, page 1

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

COALITION FOR ICANN

TRANSPARENCY,

Plaintiff,

v.

VERISIGN, INC., et al.,

Defendants.

__________________________________

)

)

)

)

)

)

)

)

)

)

)

Case No.: C 05-4826 RMW PVT

ORDER RE PLAINTIFF’S MOTION

TO COMPEL

On February 21, 2006, the parties appeared before Magistrate Judge Patricia V. Trumbull for

hearing on the motion to compel brought by Plaintiff Coalition for ICANN Transparency (“CFIT”). 

Based on the briefs and arguments submitted, 

IT IS HEREBY ORDERED that CFIT’s motion is GRANTED as to Document Request 

No. 1, except that the request is limited to documents created on or after July 1, 2005. The

information sought is relevant to a determination of the likelihood that approval of the 2005 .com

Agreement is imminently impending. VeriSign is free to make its arguments regarding the

“staleness” of any particular documents or statements if and when they are submitted to Judge Whyte

in connection with a motion for preliminary injunction. This order is without prejudice to CFIT

seeking earlier-created documents in the event further discovery reveals that responsive documents

Case 5:05-cv-04826-RMW Document 130 Filed 02/23/06 Page 1 of 7
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1 The failure of VeriSign’s counsel to find out from his client when it and ICANN began

discussing the 2005 .com Agreement deprived the court of the information necessary to set a wellreasoned time limit on this Document Request. Thus, the court is expressly leaving the door open to

require VeriSign to search for earlier-created documents in the event it turns out those discussions

commenced prior to July 1, 2005.

2 Under normal circumstances, the court expects a party asserting undue burden in response

to a motion to compel to make a factual showing of burden at the time it files its opposition papers. In

light of the shortened time schedule for the expedited discovery and related motion and briefing

schedule, the court will not preclude VeriSign from moving for protection. However, the court will

require VeriSign to show that it could not possibly have anticipated any undue burden–and made some

factual showing–in the time allowed for briefing and hearing the motion to compel. A shortened briefing

schedule does not automatically relieve counsel of the duty to find out from his client what effort is

anticipated to respond to any challenged discovery requests.

ORDER, page 2

predating July 1, 2005 exist.

1

 This order is also without prejudice to any motion for protection by

Defendant VeriSign, Inc. (“VeriSign”) if VeriSign can establish that: 1) the scope of production

ordered would be unduly burdensome; and 2) VeriSign could not reasonably have made any showing

regarding the burden imposed by this Document Request at or before today’s hearing.2

IT IS FURTHER ORDERED that CFIT’s motion is GRANTED as to Document Request 

No. 2, only as it was actually written. The court will not expand the scope of this request to include

all discussions VeriSign has had with the Department of Justice. However, to the extent a document

consisting of, or relating to, communications with the Department of Justice are otherwise

responsive to the request, they must be produced. Nothing in this request excluded from its scope

documents related to “the likelihood of, process for, or timing of approval of the 2005 .com

Agreement by the Department of Commerce,” simply because they happen to also relate to the

Department of Justice.

IT IS FURTHER ORDERED that CFIT’s motion is GRANTED as to Document Request

Nos. 6 & 7, and Rule 30(b)(6) Deposition Topic No. 4. However, CFIT shall work with VeriSign to

help craft appropriate search terms for any computer searches in order to avoid unnecessary burden

on VeriSign. By imposing on CFIT an obligation to help craft appropriate search terms for computer

searches, the court is not relieving VeriSign of its obligation to also make reasonable inquiries of its

employees in order to locate responsive documents.

IT IS FURTHER ORDERED that CFIT’s motion is DENIED as to Document Request 

No. 9. Given that CFIT has agreed to limit this request to documents which are also responsive to

Case 5:05-cv-04826-RMW Document 130 Filed 02/23/06 Page 2 of 7
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3

See Folb v. Motion Picture Indus. Pension & Health Plans, 16 F.Supp.2d 1164, 1179

(C.D.Cal. 1998) (recognizing a mediation privilege for formal mediation proceedings with neutral

mediator, but declining to recognize a more general settlement privilege because “only Congress is

authorized to amend the scope of protection afforded by Rule 408”).

4

See, e.g., In re General Motors Corp. Engine Interchange Litig., 594 F.2d 1106, 1124

n. 20 (7th Cir. 1979); In re Subpoena Issued to Commodity Futures Trading Comm'n, 370 F.Supp.2d 201,

207-212 (D.D.C. 2005); Primetime 24 Joint Venture v. Echostar Communications Corp., 2000 WL

97680, *4 & n. 5 (S.D.N.Y. 2000); Morse/Diesel, Inc. v. Fidelity & Deposit Co. Of Maryland, 122

F.R.D. 447, 449 (S.D.N.Y. 1988); Bennett v. LaPere, 112 F.R.D. 136, 138-39 (D.R.I. 1986); NAACP

Legal Defense Fund, Inc. v. U.S. Dep't of Justice, 612 F.Supp. 1143, 1146 (D.D.C. 1985) (Rule 408

“was never intended to be a broad discovery privilege.”); Center for Auto Safety v. Department of

Justice, 576 F.Supp. 739, 749 (D.D.C. 1983) order vacated in immaterial part on reconsideration, 1983

WL 1955 (“While [Rule 408’s] intent is to foster settlement negotiations, the sole means chosen to

effectuate that end is a limitation on their [sic] admission of evidence produced during settlement

negotiations for the purpose of proving liability at trial, not the application of a broad discovery

privilege. Otherwise parties would be unable to discover compromise offers which could be offered for

a relevant purpose... .”). 

ORDER, page 3

Document Request Nos. 1 & 2, the motion is mooted as to this Document Request based on the

court’s grant of the motion with regard to Document Request Nos. 1 & 2.

IT IS FURTHER ORDERED that the court declines to rule on the motion with regard to Rule

30(b)(6) Deposition Topic Nos. 1 & 6 (as narrowed by CFIT), because there has been no refusal to

designate a deponent or answer a deposition question. The court will not issue advisory rulings. In

the event a dispute actually arises at a deposition regarding specific questions, the parties may

contact chambers (at 408/535-5434) to arrange a mid-deposition telephone conference with the

court.

IT IS FURTHER ORDERED that VeriSign’s objections based on a purported “settlement

privilege” are hereby OVERRULED. Rule 408 of the Federal Rules of Evidence applies to

admissibility at trial, not discoverability. The few cases cited by VeriSign are not persuasive, are

distinguishable to the extent they deal with formal mediation proceedings with a neutral mediator,3

and/or are contrary to numerous other, better-reasoned cases.4 

Federal Rule of Evidence 501 authorizes federal courts to recognize new privileges only by

interpreting “the principles of the common law ... in the light of reason and experience.” See

FED.R.EVID. 501. The Supreme Court has explained that: “When we come to examine the various

claims of exemption, we start with the primary assumption that there is a general duty to give what

testimony one is capable of giving, and that any exemptions which may exist are distinctly

Case 5:05-cv-04826-RMW Document 130 Filed 02/23/06 Page 3 of 7
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

5

Id. at 9-10

6 See footnote 4, above.

ORDER, page 4

exceptional.” Jaffee v. Redmond, 518 U.S. 1, 9 (1996) (quotation omitted). While Rule 501 directs

courts to “continue the evolutionary development of testimonial privileges,”5 the Supreme Court has

warned that privileges “are not lightly created nor expansively construed, for they are in derogation

of the search for truth.” United States v. Nixon, 418 U.S. 683, 710 (1974); see also Univ. of

Pennsylvania v. EEOC, 493 U.S. 182, 194 (1990) (“Although Rule 501 manifests a congressional

desire not to freeze the law of privilege...we are disinclined to exercise this authority expansively.”).

The Supreme Court has identified various factors to be considered by courts in determining

whether to recognize a new privilege under Rule 501. One key factor is whether there is a broad

consensus in federal and state law in favor of the privilege. See Jaffee, 518 U.S. at 12 (emphasizing

that “all 50 States and the District of Columbia have enacted into law some form of psychotherapist

privilege”); see also, In re Sealed Case, 148 F.3d 1073, 1077 (D.C.Cir. 1998) (“The Supreme Court

has put considerable weight upon federal and state precedent when recognizing a privilege.”). 

Another factor is whether “Congress has considered the relevant competing concerns but has not

provided the privilege itself.” Univ. of Pennsylvania, 493 U.S. at 194. Also considered is whether

the proposed privilege is included on the list of evidentiary privileges recommended by the Advisory

Committee of the Judicial Conference in its proposed Federal Rules of Evidence. See Jaffee, 518

U.S. at 14; see also, United States v. Gillock, 445 U.S. 360, 365 (1980). Finally, “[t]he Supreme

Court has instructed that a party seeking judicial recognition of a new evidentiary privilege under

Rule 501 demonstrate with a high degree of clarity and certainty that the proposed privilege will

effectively advance a public good.” In re Sealed Case, 148 F.3d at 1076.

VeriSign has not come forward with a persuasive case for a federal settlement privilege under

any of these factors. There does not appear to be any “broad consensus in federal and state law in

favor of the privilege.” On the contrary, it appears most federal courts that have addressed the issue

have declined to create a settlement privilege.6

With regard to Congress’ consideration of the issue, Congress expressly chose to limit the

protection of Rule 408 to rendering settlement negotiations inadmissible for a limited number of

Case 5:05-cv-04826-RMW Document 130 Filed 02/23/06 Page 4 of 7
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

ORDER, page 5

purposes. Congress could easily have exempted such discussions from discovery altogether, but

chose not to. In fact, Congress actually added language to Rule 408 that preserves discoverability of

information exchanged during settlement negotiations: “This rule does not require the exclusion of

any evidence otherwise discoverable merely because it is presented in the course of compromise

negotiations” (emphasis added). In explaining this addition, the Advisory Committee noted: “A

party should not be able to immunize from admissibility documents otherwise discoverable merely

by offering them in a compromise negotiation.” The documents at issue here involve negotiation

and renegotiation of a business agreement. The fact the parties to that agreement were also

negotiating a settlement of claims does not immunize the negotiations of the business agreement

from discovery.

The final two factors also weigh against constructing a new settlement privilege under federal

law. No settlement privilege was listed among the nine privileges identified in the Proposed Federal

Rules of Evidence drafted by the Advisory Committee of the Judicial Conference, and transmitted by

the Supreme Court to Congress in 1972. See Proposed Rules of Evidence, 56 F.R.D. 183, 234-58

(1972) (recognizing privileges for reports required by law, the attorney client privilege, the

psychotherapist-patient privilege, the husband-wife privilege, communications to clergymen,

political votes, trade secrets, secrets of state, and informer identity). And VeriSign has not shown

that the proposed privilege will effectively advance a public good. As noted above, privileges “are in

derogation of the search for truth.” See, United States v. Nixon, 418 U.S. at 710. Thus, they actually

run counter to a well established public good. VeriSign has not shown that the public interest in

promoting out-of-court settlements trumps the public interest in ascertaining the truth. See, Jaffee,

518 U.S. at 9, 116 S.Ct. 1923 (“Exceptions from the general rule disfavoring testimonial privileges

may be justified, however, by a ‘public good transcending the normally predominant principle of

utilizing all rational means for ascertaining the truth.’”) quoting Trammel v. United States, 445 U.S.

40, 50 (1980). Nor has VeriSign shown that the public interest in promoting out-of-court settlements

is not adequately protected by the limits on admissibility expressly provided in Rule 408.

In light of the public policy expressed in Rule 408 in favor of allowing settlement discussions

into evidence for purposes other than those expressly proscribed, the public policy in favor of

Case 5:05-cv-04826-RMW Document 130 Filed 02/23/06 Page 5 of 7
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

7

See, e.g., In re: Initial Public Offering Securities Litigation, 2004 WL 60290 at *5

S.D.N.Y. 2004) (rejecting heightened standard and instead applying Fed.R.Civ.P. 26 requirement that

the settlement material need only be relevant to a claim or defense in the action); City of Wichita v. Aero

Holdings, Inc., 192 F.R.D. 300, 301-02 & n. 1 (D.Kan. 2000) (rejecting suggestion that “a higher burden

is placed on the party seeking to discover evidence related to settlement negotiations”); Griffin v.

Mashariki, No. 96 Civ. 6400, 1997WL756914, at *1 (S.D.N.Y. 1997) (“Settlement-related information,

including settlement agreements, are governed by [Rule 26] and are discoverable without a heightened

showing of relevance.”); Salgado v. Club Quarters, Inc., 1997 WL 269509, at *1 (S.D.N.Y. 1997) (“no

heightened showing need be made to justify discovery of a settlement agreement”); Securities and

Exchange Comm'n v. Downe, 1994 WL 23141 (S.D.N.Y. 1994) (standard applicable to discovery of

settlement negotiations is that provided by Fed.R.Civ.P. 26(b)(1)); and Bennett v. La Pere, 112 F.R.D.

136, 139-40 (D.R.I. 1986) (rejecting heightened showing).

ORDER, page 6

facilitating the search for truth, and the numerous prior cases that have expressly declined to create a

settlement privilege, this court finds that “the principles of the common law ... in the light of reason

and experience,” weigh heavily against recognizing any such a privilege.

Further, even if there were a settlement privilege, VeriSign’s privilege claim fails because

VeriSign has offered no evidence to support its contention that some or all of the documents sought

come within the scope of the asserted privilege. The party invoking a privilege has the burden of

proving the facts on which the privilege claim is based, and it must do so with competent and

specific evidence; it may not rely on conclusory assertions. See, e.g., United States v. Construction

Products Research, Inc., 73 F.3d 464, 473 (2d Cir. 1996); In re Kidder Peabody Secs. Litig., 168

F.R.D. 459, 467 (S.D.N.Y.1996). See also, e.g., United States v. Plache, 913 F.2d 1375, 1379 n. 1

(9th Cir. 1990). VeriSign fails entirely to make any such showing, choosing instead to rely solely on

conclusory statements by counsel.

VeriSign also argues that CFIT must make a heightened showing of relevance in order to

discover settlement negotiations. While VeriSign cites a few cases that have so held, many other

cases have rejected any such heightened showing requirement for discovery of settlement

negotiations.7 The court finds the cases rejecting any heightened showing requirement more

persuasive. As one court stated, “the Federal Rules of Civil Procedure do not permit even [a]

‘modest presumption’ [against disclosure]; they permit discovery of ‘any matter . . . that is relevant.’ 

Thus, if settlement material is to be shielded from discovery, it must find protection from some

provision other than Rule 26(b).” In re: Initial Public Offering Securities Litigation, 2004 WL

60290 at *5 S.D.N.Y. 2004) (footnotes omitted). 

Case 5:05-cv-04826-RMW Document 130 Filed 02/23/06 Page 6 of 7
U

nite

d

States District C

o

u

rt

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

ORDER, page 7

IT IS FURTHER ORDERED that, for any future motion work before Judge Trumbull, the

parties shall not use “letter briefs.” Pusuant to the parties’ stipulation, this court granted the parties

permission to use letter briefs in connection with this motion. However, the court finds the letter

brief format unhelpful for a variety of reasons, and in the future will expect proper briefs that

substantially comply with Civil Local Rules 3-4 and 7-4. This order applies only to motion work

in this case before Judge Trumbull (whether other judges accept letter briefs is for them to decide). 

Dated: 2/23/06

 

PATRICIA V. TRUMBULL

United States Magistrate Judge

Case 5:05-cv-04826-RMW Document 130 Filed 02/23/06 Page 7 of 7