Iowa Public Employees' Retirement System v. Bank of America Corporation

Cc OV I N G T O N Covington & Burling LLP

One CityCenter

BEIJING BRUSSELS DUBAI FRANKFURT JOHANNESBURG 850 Tenth Street, NW

LONDON LOS ANGELES NEW YORK PALO ALTO Washington, DC 20001-4956

SAN FRANCISCO SEOUL SHANGHAI WASHINGTON T +1202 662 6000

Via ECF February 28, 2022

The Honorable Katherine Polk Failla

United States District Court, Southern District of New York MEMO ENDORSE

40 Foley Square

New York, NY 10007

Re: Jowa Public Employees’ Retirement System v. Bank of America Corp.,

No. 17-cv-6221-KPF (S.D.N.Y.)

Dear Judge Failla:

I write on behalf of the JPMorgan defendants in response to Plaintiffs’ motion to re-open

discovery for the purpose of serving JPMorgan with “spoliation-related interrogatories” relating

to communications on employee personal devices. See ECF No. 527. Plaintiffs’ motion should

be denied because Plaintiffs had ample opportunity to seek the information sought in their

interrogatories—and in fact obtained that information to the extent it has any relevance here—

during the discovery period. Plaintiffs argue that their belated attempt to re-open these questions

is excused by a purportedly “misleading” representation made by JPMorgan in a different case

(the Interest Rate Swaps case), but that contention is utterly meritless.

1. Background. Plaintiffs’ “spoliation-related interrogatories” are directed at the steps

JPMorgan took to preserve and produce communications on employee personal devices.

Plaintiffs’ interrogatories are duplicative and untimely because the parties already addressed

those matters during the discovery period.

On May 16, 2019, Plaintiffs wrote to all Defendants asking them to confirm that they

“have been preserving text messages and ESI from phones.” One week later, JPMorgan

responded as follows:

“JPMorgan can confirm it issued litigation hold notices to appropriate

employees of JPMorgan promptly after the Complaint . . . was filed, and

that these litigation hold notices encompassed relevant phone data.

“Additionally, although JPMorgan maintains that it has no obligation to do

so under the Federal Rules, JPMorgan will contact phone log custodians

that are current employees and (1) remind them to preserve phone data in

their possession relevant to this lawsuit and (11) ask them to provide any

inter-custodian messages sent or received from any BYOD or work-issued

devices covered by our tentative phone data agreement and in their

possession.” Ex. A.

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Plaintiffs thus have known since May 2019 that JPMorgan (a) sent a document hold

notice that specifically covered personal device communications, (b) contacted the relevant

employees to remind them to preserve any personal device communications relating to the

litigation, and (c) asked them to provide any inter-custodian messages sent or received on a

mobile device encompassed by the parties’ discovery negotiations. If Plaintiffs believed that any

additional preservation measures were required, the time to say so was in May 2019—not nearly

three years later. No such suggestion was ever made.

The parties also explicitly addressed the personal device discovery that would and would

not be provided to Plaintiffs. On July 9, 2019, Plaintiffs and Defendants entered into a detailed

agreement (“Agreement”) that memorialized “the full and complete agreement between the

Parties” regarding mobile device discovery. See Ex. B § 18. The Agreement required

Defendants to make reasonable efforts to provide, for an agreed-upon list of “Covered

Custodians,” mobile phone numbers and certain company phone records and ESI for employer-

issued or employer-subsidized (i.e., “BYOD”) mobile devices. See id. □□ 1, 8-9. By contrast, for

mobile devices that were neither employer-issued nor employer-subsidized, Defendants had no

obligation even to produce the relevant phone numbers, much less any phone records or ESI.

See id. Plaintiffs agreed to serve third-party subpoenas for any additional phone records they

wished to obtain. See id. § 11. Plaintiffs also agreed that Defendants “shall have no further

obligation to provide information or records” relating to employee mobile devices. /d. 418.

JPMorgan timely provided all mobile device discovery it was required to provide under

the Agreement. In addition, consistent with its May 2019 communication to Plaintiffs, it

interviewed the relevant custodians regarding their personal devices, and timely produced the

one set of potentially relevant text messages it identified. See JPMC-SL-01089420.

Document discovery closed on May 1, 2020. Eighteen months later, on December 17,

2021, the SEC issued an order finding that a number of JPMorgan employees had used personal

devices to communicate about “the firm’s securities business,” including “investment strategy,”

“market color,” and “debt and equity underwriting issues,” from at least 2018 to 2020. See Pltfs.

Ex. 1 20-26. Although the order notes that “in some instances” these communications were

unrecoverable (id. § 7), it makes no mention of either stock lending or the 2009-to-2016 period at

issue here, and the document custodians at issue here were specifically instructed to preserve

responsive personal device communications.

2. Argument. Plaintiffs cannot show good cause to re-open discovery for the purpose of

serving “spoliation-related interrogatories” for three main reasons.

First, Plaintiffs base their motion on their assertion that JPMorgan made an “untrue”

representation that its employees did not communicate via “text messages and communications

on... employees’ personal devices” (Ltr. at 1-2), but that accusation is specious. Plaintiffs rely

on a March 12, 2019 e-mail in this action in which counsel for JPMorgan merely objected that

producing certain phone logs data “would be an extraordinarily expensive and time-intensive

endeavor.” See Ltr. at 2; Ex. C at 1. That mere burden objection, however, comes nowhere near

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a representation that JPMorgan employees did not communicate via text messages or personal

devices. Nor did this straightforward burden objection have any effect on the course of

discovery: notwithstanding that objection, JPMorgan and all other Defendants agreed in the July

2019 Agreement to provide relevant phone logs within their custody and control. Ex. B § 8.

Plaintiffs also rely on a February 23, 2018 e-mail sent in a different action—the /nterest

Rate Swaps or “TRS” action—but that e-mail made no mention whatsoever of text messages or

personal devices. Instead, it merely stated that “JPMorgan does not permit its employees to use

[an itemized list of messaging applications] in the course of their employment.” See Pltfs. Ex. 3.

As JPMorgan has explained in the /RS litigation, that statement was entirely accurate, and the

IRS discovery record belies any suggestion that the February 23 e-mail misled the plaintiffs even

in the /RS action. See Exs. D and E. In any event, it borders on the frivolous to suggest that a

single sentence in a single e-mail that (1) was sent in a separate action and (11) made no mention

of text messages or personal devices somehow led Plaintiffs to believe that the document

custodians in this action did not communicate via text messages or personal devices.

Second, the proposed interrogatories are duplicative and untimely. When Plaintiffs

inquired in May 2019 about the steps JPMorgan was taking to preserve personal device

communications, JPMorgan responded by telling Plaintiffs exactly what it was doing to preserve

those communications. Supra at 1-2. Plaintiffs have never suggested—either then or now—that

any additional preservation measures were required; nor did they ask any follow up questions.

Having failed to ask any further questions about JPMorgan’s preservation measures when the

parties were discussing that issue in 2019, Plaintiffs have no right to serve untimely

interrogatories directed at that issue long after the discovery deadline. See, e.g., Bakalar v.

Vavra, 851 F. Supp. 2d 489, 493 (S.D.N.Y. 2011) (denying leave to re-open discovery where

“there has already been adequate opportunity for discovery”); In re Health Mgmt., Inc., 1999 WL

33594132, at *5 (E.D.N.Y. Sept. 25, 1999) (declining to reopen discovery where plaintiff could

have sought the discovery at issue during the discovery period).

Third, Plaintiffs have already received all personal device discovery they were entitled to

receive. Consistent with its May 2019 e-mail to Plaintiffs, JPMorgan interviewed the relevant

document custodians, asked them whether they had any responsive personal device

communications, and produced the small set of potentially relevant text messages it identified.

JPMorgan also provided all additional discovery it was required to provide under the July 2019

Agreement, and the Agreement provided that JPMorgan would have no further discovery

obligations relating to personal devices. See Ex. B § 18. The proposed interrogatories thus are

pointless: Plaintiffs have already received all personal device discovery they were due, and

JPMorgan is not aware of any other personal device communications relating to this litigation.

Moreover, even if Plaintiffs could identify any preservation failure here (and they cannot), they

would have no basis for seeking spoliation sanctions because sanctions are not available to a

party that failed to insist on production of the allegedly-spoliated evidence. See, e.g., Klezmer ex

rel. Desyatnik v. Buynak, 227 F.R.D. 43, 52 (E.D.N.Y. 2005).

For all these reasons, Plaintiffs’ motion should be denied.

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Respectfully submitted,

s/

Robert D. Wick

Counsel to the JPMorgan

Defendants

The Court is in receipt of Plaintiffs’ letter motion, dated February 23,

2022, seeking to reopen discovery for the purpose of serving spoliation-

related interrogatories on JPMorgan. (Dkt. #527). The Court has also

received JPMorgan’s above-letter in opposition, dated February 28, 2022.

(Dkt. #531-532).

Plaintiffs' request for a conference regarding its discovery motion is

hereby GRANTED. The parties are directed to appear for a telephonic

conference on March 3, 2022, at 2:00 p.m. At the appointed time, the

parties shall call (888) 363-4749 and enter access code 5123533. Please

note that the conference line will be unavailable prior to 2:00 p.m.

The Clerk of Court is directed to terminate the pending motion at docket

entry 527.

Dated: March 2, 2022 SOQ ORDERED.

New York, New York

Kater Vall. vel

HON. KATHERINE POLK FAILLA

UNITED STATES DISTRICT JUDGE