Nuverra Environmental Solutions, Inc. (OTCQB: NESC), one of the largest environmental solutions companies focused on the development and ongoing production of oil and natural gas in the United States, and 13 of its affiliates, have filed for chapter 11 bankruptcy protection in the United States Bankruptcy Court for the District of Delaware (Lead Case No. 17-10949). The petition lists between $100 and $500 million in assets and between $500 million and 1 billion in liabilities. The Debtors enter chapter 11 with a prepacked plan of reorganization that, pursuant to the Company’s Chief Executive Officer and Chairman “has overwhelming support . . . from [the] Term loan lenders and 2021 noteholders.” The debtors have also filed a disclosure statement regarding their plan. Pursuant to the First Day Declaration, the Debtors goal is to emerge quickly from chapter 11 with reduced debt. The Debtors secured $31.5 million in DIP financing from lenders under their Existing Revolving Credit Facility and $12.5 million from their Existing Term Loan Lenders. Prime Clerk is the proposed claims agent. The company previously issued a press release regarding its restructuring plans. The Honorable Kevin J. Carey will be presiding over these cases.
If your practice involves discovery, chances are you have been on the receiving end (and maybe the dispensing end) of prolix boilerplate general objections in response to interrogatories or document demands. Whatever logic may have led to the development of a laundry list of blasé general objections, courts have made clear that they are ineffective for much more than wasting space and annoying judges and that lawyers should stop interjecting them. See, e.g., Fischer v. Forrest, 2017 WL 773694 (S.D.N.Y. Feb. 28, 2017) (Peck, Mag.); Sagness v. Duplechin, 2017 WL 1183988, at *2 (D. Neb. Mar. 29, 2017) (Zwart, Mag.); Liguria Foods, Inc. v. Griffith Labs., Inc., 2017 WL 976626 (N.D. Iowa Mar. 13, 2017); Cafaro v. Zois, 2016 WL 903307, at *1 (S.D. Fla. Mar. 9, 2016) (“Boilerplate objections may also border on a frivolous response to discovery requests.” citing Steed v. Everhome Mortg. Co., 308 F. App’x 364, 371 (11th Cir. 2009)); Heller v. City of Dallas, 303 F.R.D. 466, 482-85 (N.D. Tex. 2014) (“Counsel should cease and desist from raising these free-standing and purportedly universally applicable ‘general objections’ in responding to discovery requests.”); Waldrop v. Discover Bank (In re Waldrop), 560 B.R. 806, 810 (Bankr. W.D. Okla. 2016). Some state courts have reached the same level of frustration with general objections. See, e.g., In re Oxbow Carbon LLC Unitholder Litig., 2017 WL 959396, at *2-3 (Del. Ch. Mar. 13, 2017).
The Federal Rules of Civil Procedure have long stated that “the grounds for objecting to an interrogatory must be stated with specificity” and since December 1, 2015 the Federal Rules also state that, with regard to document requests, “[f]or each item or category, the response must either state that inspection and related activities will be permitted as requested or state with specificity the grounds for objecting to the request, including the reasons.” Fed. R. Civ. P. 33(b)(4) and 34(b)(2)(B). The word “specificity” in both rules precludes generic “general” objections. See, e.g., Sagness, 2017 WL 1183988, at *2 (“Objections to interrogatories and requests for production of documents must be stated with specificity…. General blanket objections do not meet these specificity requirements and will be disregarded by this court.”). Yet many lawyers persist in lodging general objections. See Fischer, 2017 WL 773694, at *1 (“Most lawyers who have not changed their ‘form file’ violate one or more (and often all three) of [the] changes” to Fed. R. Civ. P. 33(b)(2)(B)-(C)).
General objections can be lumped into three broad categories:
- Objections “Preserving” Rights Already Preserved Under the Civil Rules. These objections typically assert a general ground for objection that would be preserved whether stated or not. Some examples of these objections include:
- Objections to the extent that a request or interrogatory implicates privileged material. Privileged material is already excluded from the scope of discovery under Civil Rule 26(b)(1) and a generic assertion of privilege is, in and of itself, useless under Civil Rule 26(b)(5)(A)(ii). See Schultz v. Sentinel Ins. Co., Ltd., 2016 WL 3149686, at*7 (D. S.D. Jun. 3, 2016) (“boilerplate ‘general objections’ fail to preserve any valid objection at all because they are not specific to a particular discovery request and they fail to identify a specific privilege or to describe the information withheld pursuant to the privilege”); Liguria Foods, 2017 WL 976626, at *11 (failure to provide privilege log renders privilege objections ineffective).
- Objections to the extent a document request purports to require a party to obtain information that is not within its possession, custody or control. If the request purports to impose such a burden, it does not comply with Civil Rule 34(a)(1) in the first instance.
- Objections that reserve the “right” to supplement responses. Parties are required to supplement their responses under Civil Rule 26(e)(1). See Heller, 303 F.R.D. at 484. This “objection” is pointless.
- Objections that the production of a document is not an admission of authenticity, relevance, materiality or admissibility. Given that the scope of discovery expressly includes inadmissible documents under Civil Rule 26(b)(1), there can be no waiver arising from the production of inadmissible documents. And the Federal Rules of Evidence regarding admissibility exist for a reason.
- Objections Contradicted by the Civil Rules or Other Authority. These objections contradict the Civil Rules or other authority. Some examples include:
- Objections to interrogatories to the extent that they call for legal conclusions. Civil Rule 33(a)(2) provides that an interrogatory is not objectionable simply because it “asks for an opinion or contention that relates to … the application of law to fact….”
- Objections to interrogatories or document requests seeking information regarding settlement negotiations. Federal Rule of Evidence 408 is a rule of admissibility, not discoverability. See Arcelormittal Ind. Harbor LLC v. Amex Nooter, LLC, 2016 WL 4077154 (N.D. Ind. Jul. 9, 2016) (holding that even after removal of “discovery of admissible evidence” language from Rule 26, settlement documents remain discoverable); see also R. Civ. P. 26(b)(1) (“Information within this scope of discovery need not be admissible in evidence to be discoverable.”).
- Objections that interrogatories are not admissions. “[D]isavowing interrogatory responses as ‘admissions of any nature’ flies in the face of Rule 33(c)’s provision that ‘[a]n answer to an interrogatory may be used to the extent allowed by the Federal Rules of Evidence.’” Heller, 303 F.R.D. at 484.
- The “not reasonably calculated to lead to the discovery of admissible evidence” objection. Lawyers who continue to make this objection have not read Civil Rule 26(b)(1) since December 1, 2015 or the Advisory Committee Notes accompanying the 2015 amendments to the Federal Civil Rules. This is no longer a valid objection. See Fischer, 2017 WL 773694, at *3 (“The 2015 amendments deleted that language from Rule 26(b)(1), and lawyers need to remove it from their jargon.”); In re Bard IVC Filters Prods. Liability Litig., 317 F.R.D. 562, 564 (D. Ariz. 2016) (“The 2015 amendments … eliminated the ‘reasonably calculated’ phrase as a definition for the scope of permissible discovery. Despite this clear change, many courts continue to use the phrase. Old habits die hard.”).
- Substantive Objections Improperly Generalized. This category comprises two very common objections that are just as commonly stated generally rather than specifically:
- The “overly broad and unduly burdensome” objection. Absent more, this “objection” is useless. See Fischer, 2017 WL 773694, at *3 (“[S]tating that the requests are ‘overly broad and unduly burdensome’ is meaningless boilerplate. Why is it burdensome? How is it overly broad? This language tells the Court nothing.”); Heller, 303 F.R.D. at 490-91(“the party resisting discovery [must] show how the requested discovery was overly broad, unduly burdensome, or oppressive by submitting affidavits or offering evidence revaling the nature of the burden”).
- The “vague, ambiguous or confusing” objection. Here again, absent more, this “objection” is useless. The party objecting on these grounds “‘must explain the specific and particular way in which a request is vague.’” Heller, 303 F.R.D. at 491 (quoting Consumer Elec. Ass’n. v. Compras & Buys Magazine, Inc., 2008 WL 4327253, at 2 (S.D. Fla. Sep. 18, 2008)).
The typical practice is to incorporate these general objections into responses to individual interrogatories and document requests. Courts are consistently, and strenuously, admonishing against this. See, e.g., Fischer, 2017 WL 773694, at *3 (“General objections should rarely be used after December 1, 2015 unless each such objection applies to each document request….”); Meggit (Orange Cnty.), Inc. v. Nie, 2015 WL 12743695, at *1 (C.D. Cal. Feb. 17, 2015) (“The practice of making boilerplate general objections couched in terms of ‘to the extent’ and then incorporating those general objections into each interrogatory response is improper.”). In short, counsel must craft targeted responses and objections to each document request or interrogatory and cannot simply incorporate general objections into those responses.
This is not to say that general objections are always inappropriate. For instance, because instructions and definitions in discovery requests apply generally to each request, objections to those instructions and definitions that are then incorporated into each response for the sake of efficiency may be appropriate. Some examples include objections to directions that impose requirements for privilege logs well beyond those imposed under Civil Rule 26(b)(5)(A)(ii) or that require responding parties to describe lost or destroyed documents in levels of detail that are often impossible to provide for the very obvious reason that the document is lost or destroyed.
Counsel should consider jettisoning boilerplate general objections for several reasons, including:
- General objections preserve nothing. See Liguria Foods, 2017 WL 976626, at *11 (“[T]he idea that … general or ‘boilerplate’ objections preserve any objections is an ‘urban legend.’” quoting Matthew L. Jarvey, Boilerplate Discovery Objections: How They Are Used, Why They Are Wrong, and What We Can Do About Them, 61 Drake L. Rev. 913, 926 (2013)).
- Reliance upon general objections to the exclusion of specific, targeted objections to interrogatories or discovery requests constitutes a waiver of whatever objection the party was trying to make. See, e.g., St. Farm Fire & Cas. Co. v. Admiral Ins. Co., 2016 WL 8135417, at *7 (D. S.C. Feb. 4, 2016) (“Boilerplate, general objections standing alone waive any actual specific objections.” citing Mancia v. Mayflower Textile Servs. Co., 253 F.R.D. 354, 358-59 (D. Md. 2008)).
- Courts are now highly attuned to, and annoyed by, improper general objections, which may be the best reason of all to stop using them. See, e.g., Jones v. Bank of Am., N.A., 2015 WL 1808916, at *5 (S.D. W. Va. Apr. 21, 2015) (Eifert, Mag.) (“Quite frankly, the undersigned is astounded and troubled that, even after appearing in many cases in this district and despite clear and established circuit case law holding that such objections are improper, counsel for Defendant persists in asserting a litany of insupportable general objections in response to discovery requests.”); Liguria Foods, 2017 WL 976626, at *2 (“it is clear to me that admonitions from the courts have not been enough to prevent such conduct and that, perhaps, only sanctions will stop this nonsense”).
Old habits and bad habits are the hardest to break, but interjecting and relying on boilerplate general objections is an old and bad habit worth breaking for all of the foregoing reasons, which are incorporated herein by reference.
Upcoming Committee Formation Meeting: Thursday, May 4, 2017, 1:00 pm
Case Name: 17-10828 (KG)
Location: Office of the US Trustee 844 King Street, Room 3209 Wilmington, DE 19801
Adams Resources Exploration Company, an oil and gas exploration and production company based in Houston, Texas, has filed a voluntary petition for relief under Chapter 11 under Chapter 11 in the United States Bankruptcy Court for the District of Delaware (Case No. 17-0866-KG). The Debtor is a subsidiary of Adams Resources & Energy (NYSE MKT: AE), whose primary operations are as a midstream oil and gas transporter. According to a press release issued by Adams R&E, the Debtor plans to sell its non-operated working interest in approximately 470 wells located in the Permian Basin, Haynesville Shale and across the Gulf Coast. The Debtor’s petition estimates it assets between $1–$10 million and its liabilities between $50–$100 million. The case has been assigned to the Honorable Kevin Gross.
Upcoming Committee Formation Meeting: Thursday, April 27, 2017, 10:30 am
Case Name: 17-10772 (BLS)
Location: Delaware State Bar Association 405 King Street, 2nd floor Wilmington, DE 19801
Notice of Formation Meeting for Official Committee of Unsecured Creditors can be found here. See the petition for relief under Chapter 11, the First Day Declaration, and the proposed claims agent, Garden City Group, LLC, for further information.
Upcoming Committee Formation Meeting: Friday, April 28, 2017, 1:00 pm
Case Name: 17-10839 (LSS)
Location: Office of the US Trustee 844 King Street, Room 3209 Wilmington, DE 19801
Panda Temple Power, LLC and Panda Temple Power Intermediate Holdings II, LLC filed for chapter 11 bankruptcy protection in the United States Bankruptcy Court for the District of Delaware (Lead case: 17-10839). The petition lists between $100 and $500 million in both assets and liabilities. Prime Clerk is the proposed claims agent. The Debtors are seeking joint administration of these cases. The Honorable Laurie Selber Silverstein will preside over these cases.
Suniva, Inc., a manufacturer of solar cells and solar modules based in Norcross, GA, has filed a petition for relief under Chapter 11 in the United States Bankruptcy Court for the District of Delaware (Case No. 17-10837). Suniva’s petition reports $10 – $50 million in assets and $100 – $500 million in liabilities. According to the First Day Declaration, Suniva’s filing was caused by Suniva’s incurrence of significant debt as part of a planned expansion of its production facilities, coupled with downward pressure on solar cell prices caused by foreign competition. The case has been assigned to the Honorable Kevin Gross. The Garden City Group, LLC is the proposed claims agent.
Venoco, LLC and five of its subsidiaries and affiliates have filed voluntary petitions for relief under Chapter 11 in the United States Bankruptcy Court for the District of Delaware (Case No. 17-10828). Venoco, an oil and gas exploration and production company primarily operating in California, has issued a press release stating that it intends to wind down its operations through the bankruptcy process. This is Venoco’s second Chapter 11 filing in the past two years; Venoco’s predecessor, Venoco, Inc., filed for Chapter 11 on March 18, 2016 (Case No. 16-10655). Venoco, Inc. confirmed a plan of reorganization on July 14, 2016 (Case No. 16-10655, Docket No. 370), which wiped out nearly $1 billion in debt through a debt to equity conversion. Venoco’s petition reports $10-$50 million in assets and $50-$100 million in liabilities. The cases have been assigned to the Honorable Kevin Gross. Prime Clerk, LLC is the proposed claims agent.
Upcoming Committee Formation Meeting: Friday, April 21, 2017, 9:30 am
Case Name: 17-10810 (LSS)
Location: Delaware State Bar Association 405 King Street, 2nd Floor Wilmington, DE 19801