Republic of Ecuador v. Mackay

Fed. R. Civ. Pro. Rule 26(b)(3) does not provide presumptive protection for all expert trial preparation materials.

Texaco and the country of Ecuador have been involved in an ongoing dispute since 1964 over the exploration and drilling for oil in Ecuador. In 2001, Chevron bought Texaco. In 2003, a group of Ecuadorians brought suit against Chevron in what is known as the “Lago Agrio” action. The Ecuadorian courts awarded a judgment of $18 million against Chevron. Douglas Mackay and Michael Kelsch served as expert witnesses for Chevron in the Lago Agrio action. Chevron contended there was widespread fraud in the proceedings and brought an action for arbitration between the parties according to the bilateral investment treaty. Pursuant to the arbitration, the Republic of Ecuador sought discovery pertaining to Mackay and Kelsch. Chevron refused to turn over thousands of documents, asserting they were privileged. The magistrates and district courts determined that confidential communications between Chevron and both Mackay and Kelsch must be turned over because they are not immune to discovery under Fed. R. Civ. P. 26(b)(3). Chevron argued that Rule 26(b)(4), which applies to trial preparation communications between attorneys and experts, was also included in the trial preparation materials discovery exclusion under Rule 26(b)(3). This conclusion would make the documents pertaining to Mackay and Kelsch not subject to discovery. The Ninth Circuit, however, disagreed. The panel concluded that Rule 26(b)(3) on its face did not include communications with experts as trial preparation materials. The panel also found that the 2010 amendments did not change the structure of Rule 26. Additionally, the panel stated that policy considerations should allow the discovery of these expert communications to provide an adversary with sufficient information for trial. AFFIRMED.