1. 92 S.W.3d 419 (Tex. 2002) Megan Marquardt November 22, 2010
In re Nitla S.A. DE C.V.
92 S.W.3d 419 (Tex. 2002)
Megan Marquardt
November 22, 2010

2. Parties Nitla Bank of America Mexican pharmaceutical company
Claims that Bank of America misappropriated over $24 million of Nitla’s funds on deposit
Bank of America
Wants Nitla’s counsel disqualified

3. Facts Nitla asked BOA to produce documents
BOA asserted attorney-client and work-product privileges - would be irreparably harmed if Nitla’s counsel reviewed the documents
Trial court determined that BOA should produce many of the documents
BOA wants trial court to issue stay
BOA notified Nitla that it would seek mandamus relief, but Nitla’s counsel relied on trial court’s order and reviewed the documents
BOA filed for mandamus relief
Court of appeals ultimately held that the documents were privileged
BOA moved to disqualify Nitla’s counsel
Trial court denied motion, BOA sought mandamus relief
Appellate court grants motion

4. eDiscovery legal framework
26(b)(5)(B) - if a receiving party is notified of a mistaken disclosure by the adversary, then the receiving party “must not use or disclose the information until the claim is resolved”
37(b)(2) - Failure to Comply with a Court Order
Model Rules of Professional Conduct 4.4(b)
FRE Attorney-Client Privilege and Work Product; Limitations on Waiver

5. Analysis of Case “Disqualification is a severe remedy.”
Deprives a party of its chosen counsel and can disrupt court proceedings
Nitla’s counsel didn’t violate any rules - they reviewed the documents based on court order
To disqualify opposing counsel, moving party must show that:
Opposing counsel’s reviewing the privileged documents caused actual harm to the moving party; and
Disqualification is necessary, because the trial court lacks any lesser means to remedy the moving party’s harm

6. Issues regarding eDiscovery
BOA didn’t “mistakenly” disclose privileged information
trial court handed the documents over before BOA had a chance to seek mandamus relief
BOA notified Nitla that they would be seeking mandamus relief and asked Nitla not to review or distribute the documents
Nitla relied on trial court’s order and reviewed documents anyway
Rule 26 allows receiving party to go to court under seal to get a determination of whether the information is protected

7. Conclusion Court of appeals’ order vacated
BOA could only show that reviewing the documents had enabled Nitla’s counsel to identify 4 new witnesses to depose

8. Questions/Class Discussion
Do you think the trial court should have issued a stay on production until the appellate court had a chance to review?
Court of appeals held that most of the documents were, in fact, privileged
Did Nitla violate rule 26(b)(5)(B) when they reviewed the documents before the claim was resolved?