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Behrens v. Arconic, Inc.

United States District Court, E.D. Pennsylvania

December 20, 2019

KRISTEN BEHRENS, ESQ., as Administratrix, et al.
ARCONIC, INC., et al.


          Baylson, Judge

         I. Introduction

         One of the issues that has arisen in the pretrial proceedings in this Court concerns the so-called French Blocking Statute[1] that the Arconic Defendants (“Arconic”) rely on to limit discovery of the entity controlled by or related to Arconic that is referred to as “AAP SAS.” The Court provided notice to the parties of its intent to appoint an expert on French law to analyze the relevance of the French Blocking Statute to the AAP SAS discovery dispute. (ECF 86.)[2]

         This Memorandum summarizes the discovery issues implicated by the French Blocking Statute that arise from AAP SAS's role in manufacturing and selling the allegedly defective Reynobond PE cladding to the Grenfell Tower. The Court has decided to appoint Noëlle Lenoir as a combination master and expert under Federal Rules of Civil Procedure 44.1 and 53, and Federal Rule of Evidence 706, to consider these questions and to prepare a Report and Recommendation concerning the relevance and potential impact of the French Blocking Statute.

         II. AAP SAS, the Discovery Dispute, and the French Blocking Statute

         A. AAP SAS's Relationship to this Matter

         According to Arconic, its French subsidiary AAP SAS was the entity that manufactured and sold the Reynobond PE cladding to the Grenfell Tower that allegedly exacerbated the conflagration. (ECF 49-1 at 16.) Arconic cites the defense declarations of Paul Darling, (ECF 51-2 ¶ 36), and Kevin Juedeman, (ECF 51-6 ¶ 10), in support of their contention, (ECF 49-1 at 5.)

         Arconic asserts there can be no dispute that AAP SAS manufactured and sold the Grenfell Tower Reynobond PE cladding, and that this fact is “established by judicially noticeable documents upon which the plaintiffs rely in their [C]omplaint.” (ECF 54 at 9.) In particular, Defendants highlight two citations made by Plaintiffs:

1. Paragraph 311 of Plaintiffs' Complaint, which includes a picture of a European marketing brochure for Reynobond PE cladding that was-according to Arconic- produced by AAP SAS, not Arconic, (ECF 49-1 at 5); and
2. Paragraph 316 of Plaintiffs' Complaint, which states that “the Arconic Defendants' order acknowledgements and purchase orders confirm the total area of Reynobond 55 PE 4mm Smoke Silver Metallic E9107S DG 5000 Washcoat-the Reynobond PE cladding utilized on all floors from 4 upwards-being delivered to the Grenfell Tower was 6, 586 m2.” (emphasis added). The order acknowledgements that Plaintiffs refer to are included in the Appendix to Darling's declaration and suggest that AAP SAS was the seller of the Reynobond PE cladding for the Grenfell Tower. (ECF 51-3 at 63-73.)

         Plaintiffs' Complaint does not directly mention or address AAP SAS.[3] In their Supplemental Memorandum, (ECF 100), Plaintiffs note that “the Reynobond PE cladding that was supplied to the Grenfell Tower allegedly originated from the French manufacturing facility of Arconic's wholly-owned subsidiary, AAP SAS, ” (id. at 17) (emphasis added), but Plaintiffs do not confirm their agreement with Arconic's position that AAP SAS was the manufacturer.

         B. The AAP SAS Discovery Dispute and the French Blocking Statute

         The AAP SAS discovery dispute involves the parties' disagreement about certain of Plaintiff's Requests for Production (“RFPs”). Defendants contend that the RFPs seek documents that are in the possession of AAP SAS, not Arconic.[4] (ECF 76 at 6.) However, although Arconic alleges that the documents are the property of AAP SAS, Arconic acknowledges that the documents, or at least a significant portion of them, are located in the United States. (Id.) The documents are in the United States because they were collected by AAP SAS's United Kingdom (“UK”) and French counsel, who work in DLA Piper's UK and Paris offices. (Id.) These documents were transferred electronically to the United States because DLA Piper's relativity databases are located in New York. (Id.) However, Arconic maintains that the documents “are in the control of AAP SAS, and the data are not considered to be in the custody of its indirect parent, Arconic.” (ECF 96 at 4.)

         As part of Phase 1 of the UK's Public Inquiry into the Grenfell Tower fire, AAP SAS produced documents that were related to the refurbishment of the Grenfell Tower (the “refurbishment-related documents”). (Id. at 4-5.) Arconic agreed to provide these documents to Plaintiffs, although Plaintiffs, as Core Participants in the Public Inquiry, already have access to them.[5] (Id. at 5.) In addition to the refurbishment-related documents, AAP SAS also ultimately produced internal communications regarding the sale of Reynobond PE cladding to the Public Inquiry, but this production occurred only after the London Metropolitan Police Service and the French government negotiated a European Investigative Order (“EIO”) allowing AAP SAS to produce the documents without violating the French Blocking Statute (the “EIO documents”). (Id.) According to Arconic, any of the EIO documents that the Public Inquiry considers relevant will soon be made available to the Core Participants for Phase 2 of the Public Inquiry. (Id.)

         The French Blocking Statute therefore poses distinct difficulties for this case. These difficulties first surfaced in the November 30-Day Discovery Updates submitted by Plaintiffs and Defendants. (ECF 75 at 4-5 (Plaintiffs' Update); ECF 76 at 6-9 (Defendants' Update).) Defendants asserted that “[b]ecause AAP SAS is a French company, many if not most of the AAP SAS documents in the database are subject to the French Blocking Statute.” (ECF 76 at 7.) Plaintiffs, by contrast, contended that “the law is quite clear” that the French Blocking Statute does not prohibit “Arconic from producing responsive documents located in the U.S. in a U.S.-based litigation.” (ECF 75 at 4.) The Court provided notice of its intent to appoint an expert on French law to consider the impact of the French Blocking Statute on the AAP SAS discovery dispute and invited the parties to submit their positions regarding the appointment. (ECF 86.)

         Plaintiffs and Defendants refined their arguments on the French Blocking Statute and views on the appointment of a French expert at oral argument on November 25, 2019 and in post-hearing reports. (ECF 96 (Defendants' Report); ECF 99 (Plaintiffs' Report).) Defendants' Report urged the Court to adopt one of two paths of disclosure that are available to foreign litigants and are designed to ensure compliance with the French Blocking Statute.[6] (ECF 96 at 6.) Defendants' Report also clarified that it had no objection to the appointment of Ms. Lenoir if the Court thought an expert opinion would be helpful. (Id. at 3.) Plaintiffs, by contrast, argued that the appointment of a French expert is unnecessary because under well-established law, the French Blocking Statute does not bar the requested discovery. (ECF 99 at 1.) Plaintiffs cite numerous cases in which United States federal district courts have either ignored or minimized the relevance of the French Blocking Statute in the context of a discovery dispute. (Id. at 6.)

         The most recent discovery reports confirm that the parties have not reached resolution amongst themselves about the AAP SAS documents. (ECF 101 at 7-8 (Plaintiffs' Report); ECF 102 at 11-12 ...

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