Murray Energy Corp. v. McCarthy

• Decision Date: 12 November 2015
• Docket Number: Civil Action No. 5:14-CV-39
• Court: U.S. District Court — Northern District of West Virginia
• Parties: MURRAY ENERGY CORPORATION, MURRAY AMERICAN ENERGY, INC., THE AMERICAN COAL COMPANY, AMERICAN ENERGY CORPORATION, THE HARRISON COUNTY COAL COMPANY, KENAMERICAN RESOURCES, INC., THE MARION COUNTY COAL COMPANY, THE MARSHALL COUNTY COAL COMPANY, THE MONONGALIA COUNTY COAL COMPANY, OHIOAMERICAN ENERGY INC., THE OHIO COUNTY COAL COMPANY, and UTAHAMERICAN ENERGY, INC., Plaintiffs, v. GINA McCARTHY, Administrator, United States Environmental Protection Agency, in her official capacity, Defendant.

MURRAY ENERGY CORPORATION, MURRAY AMERICAN ENERGY, INC.,THE AMERICAN COAL COMPANY, AMERICAN ENERGY CORPORATION,THE HARRISON COUNTY COAL COMPANY, KENAMERICAN RESOURCES, INC.,THE MARION COUNTY COAL COMPANY,THE MARSHALL COUNTY COAL COMPANY,THE MONONGALIA COUNTY COAL COMPANY,OHIOAMERICAN ENERGY INC., THE OHIO COUNTY COAL COMPANY,and UTAHAMERICAN ENERGY, INC., Plaintiffs, v. GINA McCARTHY, Administrator, United StatesEnvironmental Protection Agency, in her official capacity, Defendant.

Civil Action No. 5:14-CV-39

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF WEST VIRGINIA Wheeling

November 12, 2015

Judge Bailey

MEMORANDUM ORDER DENYING MOTION FOR PROTECTIVE ORDER AND MOTION TO STAY DEPOSITION

Pending before this Court are United States' Emergency Motion for Protective Order Precluding the Deposition of EPA Administrator McCarthy [Doc. 147] and United States' Motion to Stay Administrator McCarthy's Deposition [Doc. 155]. Both Motions have been fully briefed and are ripe for decision.

This civil action was filed on March 24, 2014, by Murray Energy Corporation and a number of its subsidiary or affiliated companies¹ (hereinafter collectively "Murray") seeking declaratory and injunctive relief for the EPA's alleged failure to perform its duties required under 42 U.S.C. § 7621, which requires the EPA to "conduct continuing evaluations of potential loss or shifts of employment which may result from the administration or enforcement of the provision of [the Clean Air Act] and applicable implementation plans, including where appropriate, investigating threatened plant closures or reductions in employment allegedly resulting from such administration or enforcement."

The plaintiffs contend that the EPA's enforcement of the Clean Air Act, combined with the EPA's refusal "to evaluate the impact that its actions are having on the American coal industry and the hundreds of thousands of people it directly or indirectly employs" is irreparably harming the plaintiffs [Amended Complaint, Doc. 31, p. 2].

By Order entered September 16, 2014 [Doc. 40], this Court denied the Motion and found, as a matter of law, that the EPA had a non-discretionary duty to undertake an ongoing evaluation of job losses and that this Court had and has subject matter jurisdiction to hear the case.

The plaintiffs have filed a notice of deposition setting the deposition of EPA Administrator Gina McCarthy for November 24, 2015, leading to the EPA's motion to preclude the deposition. The EPA sets forth two arguments why this Court should grant the protective order:

1. That depositions of senior government officials, such as AdministratorMcCarthy, are barred absent extraordinary circumstances; and

2. That the plaintiffs have not established extraordinary circumstances sufficient to justify Administrator McCarthy's deposition.

DISCUSSION

Any discussion of the deposition of a high ranking Government official must begin with United States v. Morgan, 313 U.S. 409 (1941). "As a general principle, a party can conduct the deposition of any other person who possesses information relevant to a claim or defense.

Parties may obtain discovery regarding any matter, not privileged, that is relevant to the claim or defense of any party, . . .. For good cause, the court may order discovery of any matter relevant to the subject matter involved in the action. Relevant information need not be admissible at the trial if the discovery appears reasonably calculated to lead to discovery of admissible evidence.

Fed.R.Civ.P. 26(b)(1).

"As a person likely to possess relevant information 'reasonably calculated to lead to discovery of admissible evidence,' [EPA Administrator McCarthy] would generally be subject to a discovery deposition. However, the Supreme Court has created an exception to this rule as it applies to high-ranking officials holding public office in the case of United States v. Morgan, 313 U.S. 409 (1941). The Morgan doctrine recognizes that, left unprotected, high-ranking government officials would be inundated with discovery obligations involving scores of cases where the public official would have little or nopersonal knowledge of material facts. Left unchecked, the litigation-related burdens placed upon them would render their time remaining for government service significantly diluted or completely consumed." United States v. Wal Mart Stores, Inc., 2002 WL 562301, at *1 (D. Md. Mar. 29, 2002).

"The Morgan doctrine arose in the context of a quasi-legislative proceeding where the Secretary of Agriculture issued an order setting rates for market agencies at the Kansas City Stockyards. Under the operative statute, the regulated agencies were entitled to a full hearing with procedural safeguards. However, due to unusual and unique circumstances, the Secretary was required to be an arbiter of rates for past years. The lower court allowed the parties to conduct a deposition of the Secretary which the Supreme Court found was inappropriate due to the proceeding before the Secretary having a quality of a judicial proceeding. Accordingly, Morgan stands for the principle that when the Secretary's duties take on a judicial quality there is no right to conduct a deposition of such a decision maker in the absence of extraordinary circumstances. See also Simplex Time Recorder Co. v. Secretary of Labor

, 766 F.2d 575 (D.C. Cir. 1985). Morgan has come to stand for the notion that as for high-ranking government officials, their thought processes and discretionary acts will not be subject to later inspection under the spotlight of deposition. Decision-makers enjoy a mental process privilege. United States v. Miracle Recreation Equip. Co., 118 F.R.D. 100 (S.D. Iowa 1987); Kyle Eng'g Co. v. Kleppe, 600 F.2d 226 (9th Cir. 1979); In re Office of Inspector General, 933 F.2d 276 (5th Cir. 1991); United States v. Merhige, 487 F.2d 25 (4th Cir.), cert. denied, 417 U.S. 918 (1974); and In re United States of America, 985 F.2d 510 (11th Cir. 1993)." Id.

"Since Morgan, federal courts have consistently held that, absent 'extraordinary circumstances,' a government decision-maker will not be compelled to testify about his mental processes in reaching a decision, 'including the manner and extent of his study of the record and his consultations with subordinates.' . See Simplex Time Recorder Co. v. Secretary of Labor

, 766 F.2d 575, 586 (D.C. Cir. 1985); Sweeney v. Bond, 669 F.2d 542, 546 (8th Cir.), cert. denied, 459 U.S. 878 (1982); Kyle Engineering Co. v. Kleppe, 600 F.2d 226, 231-32 (9th Cir. 1979); Warren Bank v. Camp, 396 F.2d 52, 56 (6th Cir. 1968); Carl Zeiss Stiftung v. V.E.B. Carl Zeiss, Jena, 40 F.R.D. 318, 325-26 (D.D.C. 1966), aff'd, 384 F.2d 979 (D.C. Cir.), cert. denied, 389 U.S. 952 (1967)." Franklin Sav. Assn. v. Ryan, 922 F.2d 209, 211 (4th Cir. 1991). See also Bogan v. City of Boston, 489 F.3d 417, 423 (1st Cir. 2007); In re United States (Holder), 197 F.3d 310, 313 (8th Cir. 1999); and In re FDIC, 58 F.3d 1055, 1060 (5th Cir. 1995).

A review of the case law surrounding the issue discloses that a deposition of a high ranking Government official will not be permitted unless (1) that official has personal knowledge of the facts at issue; (2) extraordinary circumstances or a "special need" exists for the deposition; and (3) the information is not available from an alternate source. In re:USA, U.S. Environmental Protection Agency, 624 F.3d 1368, 1372 (11th Cir. 2010); Franklin Sav. Assn. v. Ryan, 922 F.2d at 211; United States Parole Board v. Merhige, 487 F.2d 25, 29 (4th Cir. 1973); Byrd v. District of Columbia, 259 F.R.D. 1, 7 (D.D.C. 2009); United States v. Sensient Colors, Inc., 649 F.Supp.2d 309, 316, 321-22 (D.N.J. 2009); United States v. Wal-Mart Stores, 2002 WL 562301, *3 (D. Md. March 29, 2002); and Energy Capital Corp. v. United States, 60 Fed. Cl. 315, 318 (U.S. Ct. Fed. Claims2004).

In addition, the deposition may not delve into the mental processes or deliberative processes of the deponent unless there is a prima facie showing of misconduct or wrongdoing. Franklin Sav. Assn. v. Ryan, 922 F.2d at 211; Singer Sewing Mach. Co. v. N.L.R.B., 329 F.2d 200, 208 (4th Cir. 1964); Texaco Puerto Rico, Inc. v. Dept. of Consumer Affairs, 60 F.3d 867, 885 (1st Cir. 1995); Libertarian Party of Ohio v. Husted, 33 F.Supp.3d 914, 919 (S.D. Ohio 2014).

The deliberative process privilege is (1) qualified, Texas Puerto Rico, supra, at 885, citing FTC v. Warner Communications Inc., 742 F.2d 1156, 1161 (9th Cir. 1984); (2) not absolute, Id., citing First Eastern Corp. v. Mainwaring, 21 F.3d 465, 468 n. 5 (D.C. Cir. 1994); and (3) discretionary, Id., citing In re Franklin Nat'l Bank Sec. Litig., 478 F.Supp. 577, 582 (E.D. N.Y. 1979). "'[W]here the documents sought may shed light on alleged government malfeasance,' the privilege is routinely denied. Franklin, 478 F.Supp. at 582; see also Bank of Dearborn v. Saxon

, 244 F.Supp. 394, 401-03 (E.D. Mich. 1965) ('the real public interest under such circumstances is not the agency's interest in its administration but the citizen's interest in due process'), aff'd, 377 F.2d 496 (6th Cir. 1967)." Texas Puerto Rico, supra.

In Libertarian Party, supra, the Court set forth several factors for evaluating the deliberative process privilege:

Many courts have held that the deliberative process privilege is a qualified privilege. See, e.g., In re Sealed Case

, 121 F.3d 729, 737 (D.C. Cir. 1997); Marriott Int'l Resorts, L.P. v. United States, 437 F.3d 1302, 1307 (Fed. Cir.

2006); F.T.C. v. Warner Commc'ns Inc., 742 F.2d 1156, 1161 (9th Cir. 1984); E.E.O.C. v. Burlington N., 615 F.Supp.2d 717, 720 (W.D. Tenn. 2009), objections overruled sub nom. E.E.O.C. v. Burlington N. & Santa Fe Ry. Co.

, 621 F.Supp.2d 603 (W.D. Tenn. 2009). There are several factors to consider in determining whether the deliberative process privilege should be overcome, including (1) the relevance of the evidence sought, (2) the availability of other evidence, (3) the role of the government...