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Iguacu, Inc v. Antonio Cabrera Mano Filho

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION


December 10, 2012

IGUACU, INC., PLAINTIFF,
v.
ANTONIO CABRERA MANO FILHO, DEFENDANT.

The opinion of the court was delivered by: Richard Seeborg United States District Judge

ORDER OVERRULING OBJECTION TO DISCOVERY ORDER

In this breach of contract action, plaintiff Iguacu, Inc contends it is owed commissions under a written "Finder's Agreement" whereby it allegedly was obligated to, and did, assist defendant Antonio Cabrera Mano Filho ("Cabrera") in locating investors for certain ethanol production projects. One issue is whether there is a drafting error in certain portions of the written agreement. Specifically, Iguacu argues that the terms used to refer to the respective parties, "You" and "Buyer," were inadvertently transposed in some provisions. Iguacu contends the error arose from the fact that the document was prepared from an earlier "boilerplate" agreement intended for use in differently- structured transactions, and that when that prior "buyer boilerplate" form was "flipped over" to a "seller boilerplate" form, the need to reverse those references was apparently overlooked. 2 as executed, notwithstanding the alleged drafting error. Nevertheless, Iguacu previously sought and 3 was granted leave to amend its complaint to include an alternative claim for reformation, should it 4 prove necessary. 5

6 document production and deposition testimony from the attorneys who represented Iguacu in 7 connection with the negotiations leading to the formation of the agreement. The magistrate judge to 8 whom discovery disputes have been referred ruled that communications between Iguacu and those 9 attorneys have "not been placed in issue and that no waiver of attorney-client privilege or attorney 10 work product has occurred." The magistrate judge conditioned the denial of further discovery into the matter, however, on Iguacu complying with its representation that "it will not ask the attorneys to testify at trial, will not seek to introduce any previously unproduced documents withheld as privileged (or attorney work product) and will not offer any testimony by Iguacu witnesses referring 14 to alleged drafting errors by the attorneys." Cabrera now seeks review of this non-dispositive 15 ruling.

A district court may modify a magistrate judge's ruling on a non-dispositive matter only if the order is "clearly erroneous" or "contrary to law." 28 U.S.C. § 636(b)(1)(A); Fed.R.Civ.P. 72(a); 18

Bahn v. NME Hospitals, Inc., 929 F.2d 1404, 1414 (9th Cir. 1991). Here, Cabrera contends the 19 discovery it seeks is not protected by the work-product doctrine, that attorney-client privilege has 20 been waived, and that the magistrate judge erred in concluding otherwise. The proper construction 21 of the agreement, of course, does not turn on any undisclosed intent that may have been held by 22

Iguacu and known to its attorneys. Iguacu's argument that the terms "Seller" and "You" have been 23 transposed flows from the face of the agreement itself and from non-attorney testimony as to the 24 circumstances under which the document was prepared. The magistrate judge's order effectively 25 precludes Iguacu from blaming its attorneys at trial or referring to any role they may have had in 26 preparation of the document. Whether Iguacu will be able to meet its burden to establish grounds 27 for reformation absent evidence from its attorneys involved in the preparation of the document is a 28 separate question. Under these circumstances, though, Iguacu is not impermissibly using its claim Iguacu claims that the parties had a mutual understanding of the meaning of the agreement

In light of this issue and Iguacu's assertion of the reformation claim, Cabrera sought of privilege both as a "sword" and a "shield." As such, Cabrera has not shown the magistrate 2 judge's ruling to be clearly erroneous or contrary to law, and the objection is overruled. 3 4 5

IT IS SO ORDERED. 6

20121210

© 1992-2012 VersusLaw Inc.



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