In Re Motor Fuel Temperature Sales Practices Litigation[this Document Relates To All Cases.].

• Decision Date: 26 March 2010
• Docket Number: MDL No. 1840.,No. 07-1840-KHV.,07-1840-KHV.
• Parties: In re MOTOR FUEL TEMPERATURE SALES PRACTICES LITIGATION[This Document Relates To All Cases.].
• Court: U.S. District Court — District of Kansas

707 F.Supp.2d 1145

In re MOTOR FUEL TEMPERATURE SALES PRACTICES LITIGATION

[This Document Relates To All Cases.].

MDL No. 1840.

No. 07-1840-KHV.

United States District Court,

D. Kansas.

March 4, 2010.

Opinion Denying Motion for Reconsideration and for Emergency Stay March 26, 2010.

COPYRIGHT MATERIAL OMITTED

MEMORANDUM AND ORDERKATHRYN H. VRATIL, District Judge.

Plaintiffs bring putative class action claims for damages and injunctive relief against motor fuel retailers in Alabama, Arizona, Arkansas, California, Delaware, Florida, Georgia, Indiana, Kansas, Kentucky, Louisiana, Maryland, Mississippi, Missouri, Nevada, New Jersey, New Mexico, North Carolina, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Virginia, the District of Columbia and Guam. Plaintiffs claim that because defendants sell motor fuel for a specified price per gallon without disclosing or adjusting for temperature expansion, they are liable under state law theories which include breach of contract, breach of warranty, fraud and consumer protection. Following a transfer order of the Judicial Panel on Multidistrict Litigation (“JPML”), the Court has jurisdiction over consolidated pretrial proceedings in these actions. See 28 U.S.C. § 1407; Doc. # 1 filed June 22, 2007. This matter comes before the Court on Plaintiffs' Motion To Review And Set Aside The Magistrate Judge's Order Dated May 28, 2009 (“ Plaintiffs' Motion For Review ”) (Doc. # 1195) filed June 11, 2009 and Defendants' Motion For Review Of Magistrate O'Hara's Orders ( Docs. 1080, 1196 ) (“ Defendants' Motion For Review ”) (Doc. # 1214) filed June 25, 2009. For reasons stated below, the Court sustains plaintiffs' motion and overrules defendants' motion.

I. Legal Standards

Upon objection to a magistrate judge order on a non-dispositive matter, the district court may modify or set aside any portion of the order which it finds to be clearly erroneous or contrary to law. Fed.R.Civ.P. 72(a); ¹ 28 U.S.C. § 636(b)(1)(A). With regard to fact findings, the Court applies a deferential standard which requires the moving party to show that the magistrate judge order is clearly erroneous. See Burton v. R.J. Reynolds Tobacco Co., 177 F.R.D. 491, 494 (D.Kan.1997). Under this standard, the Court is required to affirm the magistrate judge order unless the entire evidence leaves it “with the definite and firm conviction that a mistake has been committed.” Ocelot Oil Corp. v. Sparrow Indus., 847 F.2d 1458, 1464 (10th Cir.1988) (quoting United States v. U.S. Gypsum Co., 333 U.S. 364, 395, 68 S.Ct. 525, 92 L.Ed. 746 (1948)); see also Smith v. MCI Telecomm. Corp., 137 F.R.D. 25, 27 (D.Kan.1991) (district court generally defers to magistrate judge and overrules only for clear abuse of discretion). With regard to legal matters, the Court conducts an independent review and determines whether the magistrate judge ruling is contrary to law. See Sprint Commc'ns Co. v. Vonage Holdings Corp., 500 F.Supp.2d 1290 (D.Kan.2007); see also 11 Charles Alan Wright, Arthur R. Miller, Richard L. Marcus, Federal Practice And Procedure § 3069 (2d ed., 2009 update). Under this standard, the Court conducts a plenary review and may set aside the magistrate judge decision if it applied an incorrect legal standard or failed to consider an element of the applicable standard. See, e.g., Owner-Operator Indep. Drivers Ass'n, Inc. v. C.R. England, Inc., No. 2:02-CV950 TS, 2009 WL 5066679, at *2 (D.Utah Dec.16, 2009); Jensen v. Solvay Chem., Inc., 520 F.Supp.2d 1349, 1350 (D.Wyo.2007); Dias v. City & County of Denver, Colo., No. CIVA07CV00722-WDMMJW, 2007 WL 4373229, at *2 (D.Colo. Dec.7, 2007); McCormick v. City of Lawrence, Kan., No. 02-2135-JWL, 2005 WL 1606595, at *2 (D.Kan. July 8, 2005). Cf. Weekoty v. United States, 30 F.Supp.2d 1343, 1344 (D.N.M.1998) (applying de novo review to magistrate judge legal determination on non-dispositive matter).

II. Procedural History

On May 28, 2009, Magistrate Judge James P. O'Hara issued a memorandum and order on the following discovery motions Plaintiffs' Motion To Compel Discovery And Memorandum In Support (Doc. # 668) filed December 8, 2008 Plaintiffs' Motion To Compel Discovery From Petroleum Marketers and Convenience Store Association of Kansas And Memorandum In Support (Doc. # 738) filed February 2, 2009; and defendants' Motion To Quash And For Protective Order (Doc. # 999) filed April 9, 2009. See Doc. # 1080.

In the first motion, plaintiffs sought information and documents from certain defendants relating to their communications with trade associations, weights and measures organizations and government agencies. See Doc. # 668. Defendants objected that producing the information would infringe their First Amendment right to freely associate to pursue political, social and economic ends. See Doc. # 697 filed January 9, 2009 at 1, 10-23. Defendants also asserted that under the doctrine set forth in E.R.R. Presidents Conf. v. Noerr Motor Freight, Inc., 365 U.S. 127, 81 S.Ct. 523, 5 L.Ed.2d 464 (1961), and United Mine Workers of Am. v. Pennington, 381 U.S. 657, 85 S.Ct. 1585, 14 L.Ed.2d 626 (1965) (the “ Noerr-Pennington doctrine”), the documents which plaintiffs sought were inadmissible and therefore irrelevant and that plaintiffs' requests were unduly burdensome. See Doc. # 697 at 3, 23-29.

In the second motion, plaintiffs sought documents from the Petroleum Marketers and Convenience Store Association of Kansas (“PMCA-KS”), a non-party trade association of petroleum distributors, retailers and convenience stores in Kansas, regarding-among other things-its membership, financial contributors and lobbying and strategy efforts concerning ATC for retail motor fuel. See Doc. # 738 and Exhibit A thereto. Various defendants who are members of that organization objected that producing the documents would infringe their First Amendment rights to free speech and freedom to associate to pursue political, social and economic ends.²See Doc. # 783 at 1, 7-32. Defendants also asserted that under Noerr-Pennington, the documents were inadmissible and therefore irrelevant and that plaintiffs' requests were unduly burdensome. Id. at 2, 21-30.

In the third motion, defendants sought to quash subpoenas which plaintiffs had issued to the California Independent Oil Marketers Association (“CIOMA”), the Petroleum Marketers Association of America (“PMAA”), the Association for Convenience and Petroleum Retailing (“NACS”), NATSO, Inc. and the Society of Independent Gasoline Marketers of America (“SIGMA”), all of which are non-party trade associations of petroleum distributors, retailers, truck stop operators and/or convenience store owners. See Doc. # 999 filed April 9, 2009; Doc. # 1000 filed April 9, 2009 at 3.³ The subpoenas sought documents regarding-among other things-trade association membership, financial contributors and lobbying and strategy efforts concerning ATC for retail motor fuel. See Doc. # 601 filed October 16, 2008; Doc. # 662 filed December 5, 2008; Docs. # 964, # 965, # 966, all filed March 27, 2009. Various defendants who are members of those organizations asserted that the subpoenas violated their First Amendment right to associate and that under Noerr-Pennington, the documents were inadmissible and therefore irrelevant. See Doc. # 1000 at 1-2, 7-18. Defendants also argued that the joint-defense/common-interest privilege protected against disclosure see id. at 2, 19-20, and that the subpoenas imposed unreasonable and undue burdens on defendants and the trade associations. See Doc. # 1000 at 21-23.

Judge O'Hara found that the parties' dispute involved three categories of information: (1) membership lists of trade associations, (2) financial contributors of trade associations and (3) information relating to past political activities of defendants, including lobbying and legislative affairs of their trade associations. See id. at 7-8.⁴ Regarding membership lists and financial contributors, Judge O'Hara found that the First Amendment right to associate protected against compelled disclosure of confidential information. See id. at 8, 16, 19. He ruled that to the extent such information had been publicly disclosed, however, the First Amendment privilege did not apply. See id. at 8. As to defendants' past political activities, Judge O'Hara found that the First Amendment protected against compelled disclosure of internal trade association communication concerning legislative and lobbying efforts regarding ATC for retail motor fuel. See id. at 9-12, 18-19. He ruled, however, that the First Amendment did not protect all communications between defendants and trade associations-or within trade associations-regarding ATC for retail motor fuel. See id. at 13. With regard to information relating to lobbying and legislative affairs of trade associations, Judge O'Hara found that the First Amendment privilege only applied to “internal evaluations of lobbying and legislation, strategic planning related to advocacy of their members' positions, and actual lobbying on behalf of members.” Id. at 13. Judge O'Hara found that the First Amendment did not protect against compelled disclosure of other communication to, from or within trade associations. Id.

As to plaintiffs' motions to compel (Docs. # 668 and # 738), Judge O'Hara sustained the motions in part. See Doc. # 1080 at 19-20, 25. With respect to both motions, he found that the First Amendment right to associate protected against disclosure of confidential membership and financial contributor information and internal trade association communications regarding legislative affairs and lobbying efforts concerning ATC for retail motor fuel. See id. at 8-19. He sustained plaintiffs' motions to compel membership and financial contributor information which had been publically disclosed see id. at 8-9, and communications to, from or within trade associations which did not constitute internal communications regarding legislative affairs and...