In re Fannie Mae Sec. Litig., 552 F.3d 814 (D.C. Cir. 2009)
In this case, the district court held defendants had sole authority to dictates search terms, per stipulated order, and sanctioned a third-party for failure to timely produce documents, despite significant efforts to comply with the deadline. The Court of Appeals affirmed.
Individual defendants served a third-party subpoena on The Office of Federal Housing Enterprise Oversight (“OFHEO”), requesting production of over 30 categories of documents. The court denied OFHEO’s subsequent motion to quash, and entered an order directing compliance.
The defendants then agreed to limit the requests for electronically stored information to emails stored on OFHEO’s network and backup tapes. After the court granted several requests for an extension of time to comply, OFHEO finally produced what it represented were “all” relevant materials. However, defendants later discovered that OFHEO failed to search all of its off-site disaster-recovery backup tapes.
Despite OFHEO’s voluntary agreement to conduct a search of these tapes, defendants moved to hold OFHEO in contempt. Following a day of hearings on the issue, the parties entered into a stipulated order holding the contempt motions in abeyance and requiring OFHEO to conduct searches of its disaster-recovery back-up tapes and to produce those documents, as well as a privilege log, by a date certain. Thereafter, a dispute arose requiring the court’s clarification that the stipulated order gave sole discretion to specify search terms to the defendants. Despite OFHEO’s attempts to comply with the order, it indicated its inability to timely produce the required privilege logs. Accordingly, defendants renewed their contempt motion. The motion was granted and, as a sanction, OFHEO was ordered to produce a category of privileged material to defendants’ counsel for review, with the specific instruction that such production would not waive privilege. OFHEO appealed.