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IBM litigation explores executive privilege issue

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A Marion Superior judge has ordered Indiana state officials to turn over thousands of documents relating to the state’s cancellation of a welfare system modernization, ruling on an issue of first impression about whether a “deliberative processes” executive privilege exists in Indiana.

Two rulings by Judge David Dreyer since early February open the door for the state’s highest appellate courts to tackle an issue they have not considered and ruled on before, and the state’s legal team is deciding in the next 10 days whether an appeal will be filed to have that question resolved.

The ruling Tuesday outlines what Indiana must turn over in the suit and countersuits of State of Indiana v. IBM and IBM v. State of Indiana, No. 49D10-1005-PL-021451, which centers on the cancellation of IBM's $1.37 billion contract to modernize the state's welfare system. The state sued IBM in May to try and recoup $437 million it had paid to the company before cancelling the 10-year contract in 2009, as a result of what the governor described as three years of complaints about the automated system. The computer giant countersued, claiming breach of contract and saying the state still owes about $100 million.

As the discovery has progressed, both sides are disputing what materials should be available and are also arguing about whether Gov. Mitch Daniels and his chief of staff Earl Goode should have to appear for depositions in the lawsuits. The state’s legal team requested a protective order during a March 18 hearing to keep the two executive branch leaders from providing “unnecessary and burdensome depositions,” while IBM’s attorney argued that Daniels was a key player in the project and can provide insight into what happened.

Ruling on the “deliberative processes" issue in February, Judge Dreyer determined that this type of executive privilege does apply in Indiana but that it may not apply to the materials in this particular state-initiated litigation. That ruling relied on federal law and other state statutes and court rulings addressing the qualified executive privilege, and the judge found guidance in Indiana statutes and legislative discussion about maintaining a “clear and deliberate regard” for executive privilege involving decision-making material.

Judge Dreyer also determined that this type of privilege should be allowed in civil litigation, citing an Ohio case from 2006 as a key guidance on that.

“Although not provided by statute, or directly found in Indiana common law, it is simply untenable to find an executive privilege can not apply to Indiana civil discovery,” he wrote. “Otherwise, there is no executive communication that is not discoverable – any lawsuit with minimally adequate allegations may suffice. As Indiana law generally endorses the public interest policy and application of executive privilege, civil discovery is at least analogous to, if not directly bound by, the weight of this surrounding authority.”

After that initial ruling, the state in early March turned over the documents in question for Judge Dreyer to review privately in order to make his decision.

The second order came Tuesday, when Judge Dreyer detailed specifically what should be produced by the state. Prior to making his ruling, he reviewed more than 11,000 documents that involved state employee e-mails, some from Daniels, as well as many more relating to the IBM contract and system. He wrote that more than half of the substantive materials involving e-mail strings are non-deliberative and include procedural manuals, public articles, charts and data graphs, and technical materials; and that some of the e-mails are more informative and functional rather than deliberative.

The items determined not to be deliberative will be turned over to IBM, but they will not be available for public review. That order may be appealed, in conjunction with the legal analysis outlined in the Feb. 5 ruling.

No ruling has been issued about whether Daniels and Goode will have to participate in depositions.


 

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  1. So that none are misinformed by my posting wihtout a non de plume here, please allow me to state that I am NOT an Indiana licensed attorney, although I am an Indiana resident approved to practice law and represent clients in Indiana's fed court of Nth Dist and before the 7th circuit. I remain licensed in KS, since 1996, no discipline. This must be clarified since the IN court records will reveal that I did sit for and pass the Indiana bar last February. Yet be not confused by the fact that I was so allowed to be tested .... I am not, to be clear in the service of my duty to be absolutely candid about this, I AM NOT a member of the Indiana bar, and might never be so licensed given my unrepented from errors of thought documented in this opinion, at fn2, which likely supports Mr Smith's initial post in this thread: http://caselaw.findlaw.com/us-7th-circuit/1592921.html

  2. When I served the State of Kansas as Deputy AG over Consumer Protection & Antitrust for four years, supervising 20 special agents and assistant attorneys general (back before the IBLE denied me the right to practice law in Indiana for not having the right stuff and pretty much crushed my legal career) we had a saying around the office: Resist the lure of the ring!!! It was a take off on Tolkiem, the idea that absolute power (I signed investigative subpoenas as a judge would in many other contexts, no need to show probable cause)could corrupt absolutely. We feared that we would overreach constitutional limits if not reminded, over and over, to be mindful to not do so. Our approach in so challenging one another was Madisonian, as the following quotes from the Father of our Constitution reveal: The essence of Government is power; and power, lodged as it must be in human hands, will ever be liable to abuse. We are right to take alarm at the first experiment upon our liberties. I believe there are more instances of the abridgement of freedom of the people by gradual and silent encroachments by those in power than by violent and sudden usurpations. Liberty may be endangered by the abuse of liberty, but also by the abuse of power. All men having power ought to be mistrusted. -- James Madison, Federalist Papers and other sources: http://www.constitution.org/jm/jm_quotes.htm RESIST THE LURE OF THE RING ALL YE WITH POLITICAL OR JUDICIAL POWER!

  3. My dear Mr Smith, I respect your opinions and much enjoy your posts here. We do differ on our view of the benefits and viability of the American Experiment in Ordered Liberty. While I do agree that it could be better, and that your points in criticism are well taken, Utopia does indeed mean nowhere. I think Madison, Jefferson, Adams and company got it about as good as it gets in a fallen post-Enlightenment social order. That said, a constitution only protects the citizens if it is followed. We currently have a bevy of public officials and judicial agents who believe that their subjectivism, their personal ideology, their elitist fears and concerns and cause celebs trump the constitutions of our forefathers. This is most troubling. More to follow in the next post on that subject.

  4. Yep I am not Bryan Brown. Bryan you appear to be a bigger believer in the Constitution than I am. Were I still a big believer then I might be using my real name like you. Personally, I am no longer a fan of secularism. I favor the confessional state. In religious mattes, it seems to me that social diversity is chaos and conflict, while uniformity is order and peace.... secularism has been imposed by America on other nations now by force and that has not exactly worked out very well.... I think the American historical experiment with disestablishmentarianism is withering on the vine before our eyes..... Since I do not know if that is OK for an officially licensed lawyer to say, I keep the nom de plume.

  5. I am compelled to announce that I am not posting under any Smith monikers here. That said, the post below does have a certain ring to it that sounds familiar to me: http://www.catholicnewworld.com/cnwonline/2014/0907/cardinal.aspx

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