© 2018 The Texas Lawbook.
By Natalie Posgate
(Feb. 26) – Anytime Frank Branson’s law firm goes toe-to-toe with a gargantuan corporate name in a personal injury case, you know you’re about to witness a fight as fierce Mayweather vs. McGregor. These days, the focus of that ferocity is a dramatic discovery battle in a case he’s brought against Toyota Motor Corp., which is taking on a life of its own. So far, it’s proving tougher than the actual merits of the lawsuit.
Despite multiple motions to compel and a November court order that commanded Toyota to produce documents, Branson’s firm, which represents the plaintiffs, still claims that Toyota is purposely concealing documents that are relevant to the case. And despite an additional order issued earlier this month by Dallas District Judge Dale Tillery that sought to glean more information from Toyota executives, the Japanese automaker continues to put up a fight.
One day before the Feb. 15 deadline Tillery gave Toyota to identify corporate representatives who could testify about its safety databases, the world’s largest automaker filed a motion for the judge to reconsider his order, which he delivered verbally at a Feb. 5 motion to compel hearing.
That issue will be considered at a follow-up hearing on March 1, which will also determine whether certain documents that are temporarily under seal should remain so.
Perhaps even more compelling than the discovery conflict is its sub-battle: a tug-of-war between the plaintiffs’ efforts to link Toyota’s alleged uncooperative behavior to evidence a former Toyota in-house lawyer leaked about the automaker’s previous patterns of concealing crucial evidence in other tort cases, and Toyota’s relentless determination to keep that evidence out of the record. The documents, leaked by Toyota lawyer-turned-whistleblower Dimitrios Biller, aided Congress and the DOJ when they investigated Toyota’s unintentional acceleration problems several years ago.
Branson and law partners Eric Stahl and Chip Brooker represent Dallas couple Benjamin and Kristi Reavis, who sued Toyota in November 2016 alleging their children sustained permanent injuries after a rear-end collision caused the front seats of the family’s Lexus to collapse into the back seats, where the children were seated.
Toyota is being defended in the litigation by Bowman and Brooke attorneys Jim Halbrooks in Minneapolis and Suzanne Swaner in Plano.
The plaintiffs claim that Toyota’s refusal to disclose information from the company’s safety design databases has prevented adequate discovery into plaintiffs’ claims that the company acted with negligence by allowing the vehicle to leave the factory with defective seats.
Branson’s firm says Toyota refuses to turn over relevant documents in their databases despite the fact that Biller disclosed existence of this information to the public more than a decade ago.
Biller Backstory
From 2003 to 2007, Biller served as national managing counsel in Toyota’s former California regional headquarters, where he oversaw litigation involving rollover accidents. Biller left the company in September 2007 after a longstanding conflict with top executives caused him to resign, according to court documents.
The resignation turned into an employment dispute in which Biller alleged Toyota wrongfully discharged him after he spent years urging the company to stop “obstructing justice” and withholding evidence from plaintiffs in lawsuits against Toyota, court documents say.
The matter went to mediation and settled with Toyota paying Biller nearly $4 million in severance in exchange for a confidentiality agreement that banned Biller from keeping, copying or publicly disclosing any of Toyota’s confidential and privileged information.
Instead, he held on to about 6,000 internal documents when he departed and began posting information about Toyota on his new litigation consulting firm’s website.
Toyota and Biller crossed paths again in the courtroom the following year after Toyota learned what Biller had done. Biller countersued with a racketeering lawsuit, arguing that the attorney-client privilege did not apply in this situation due to Toyota’s alleged conspiracy to conceal, withhold and destroy evidence in litigation. He also alleged that Toyota executives’ hostility and retaliation toward Biller caused him to suffer a nervous breakdown and major depression, which made him unable to hold down any of his jobs after leaving the company.
An arbitrator ruled completely in Toyota’s favor in 2011, ordering Biller to take nothing on his counterclaims and to pay his former employer $2.6 million. The arbitrator also issued a permanent injunction that banned Biller from violating the confidentiality agreement again.
In an unusual move, the arbitrator also allowed Toyota to publicize the arbitration award due to Biller’s unauthorized public disclosures of the nature of the dispute which “appear to have been one-sided, with prejudice to Toyota,” the ruling says. The arbitrator, retired U.S. District Judge Gary L. Taylor of the Central District of California, wished to “neutralize any such effect, and to prevent intentional or accidental misinterpretation of the arbitration result to the public.”
Even so, a year and a half before the arbitration concluded, the U.S. Congress subpoenaed Biller’s 6,000 documents for its investigation into Toyota’s acceleration defect scandal.
Of particular interest to Congress were two databases called the “Books of Knowledge” and MIK, primarily maintained by the Toyota’s top engineers, which Biller had learned about but was never allowed to access.
‘Books of Knowledge’
In a February 2010 letter that Congress’ Committee on Oversight and Government Reform sent to Toyota’s CEO, Congressional Chairman Edolphus Towns cited Biller’s description of the MIK as a database that includes information about design problems and countermeasures used to resolve issues, which can be searched by vehicle component part. Information from MIK is then downloaded by Toyota Technical Center into the secret “Books of Knowledge.”
The committee’s letter also included various internal memos between Biller and other executives at Toyota. One revealed that the company entered multimillion-dollar settlements in tort cases in which Toyota feared the plaintiffs’ lawyers were close to discovering the existence of the “Books of Knowledge.”
In their Jan. 16 motion to compel, the Reavises’ legal team argues that the documents their clients seek from the MIK and ”Books of Knowledge” already fall within the scope of Judge Tillery’s previous compel order from November which ordered Toyota to produce information relating to “(1) prior and subsequent Toyota platforms as well as (2) platform-independent information that reflects Toyota’s general awareness and understanding of design issues,” regardless of whether the information was created specifically for the 2002 Lexus ES300, the model the Reavises drove.
“Such information will allow plaintiffs’ experts to evaluate the Reavises’ vehicle in the context of Toyota’s overall knowledge concerning seatback design, crashworthiness and safety issues,” Stahl, one of the Reavises’ lawyers, wrote in the brief. “Moreover, databases like the MIK database and any information contained therein regarding design issues with seatback failures or occupant protection following a rear-end collision and ‘countermeasures’ used to resolve such issues would go to the core liability issues in this case.”
In Toyota’s briefs, the automaker’s lawyers argue that the company already searched its databases and didn’t find anything relevant to the Reavises’ discovery – particularly because the MIK database was not created until 2003, so it would not have information on any of its 2002 models.
“Thus, the requested discovery is an improper fishing expedition,” Halbrooks, Toyota’s lead lawyer, wrote in a brief. “This is particularly true where, as here, there is no evidence before the court to indicate that TMC (Toyota Motor Corporation) and TMS (Toyota Motor Sales) have not complied with their discovery obligations in this case. Thus, the attempt for ‘discovery-on-discovery’ is wholly improper.”
Toyota also argues that Judge Tillery should reconsider his verbal order to identify corporate representatives who could testify about its safety databases – or, if nothing else, provide more clarity on the scope of the order – because “in its current form, the verbal order is overly broad, unduly burdensome and requires [Toyota] to produce information that will not lead to the discovery of admissible evidence.”
The Congressional letter and its attached memos are some of the exhibits that the Branson team is asking to be admitted into evidence at the March 1 hearing in front of Judge Tillery. The other evidence they’re seeking to be admitted into the record is Biller’s original RICO complaint against Toyota and its attached exhibits, which includes Biller’s 2007 performance review and his severance agreement.
The Reavises argue they should be admitted because all of them have been publicly available online for years and have been admitted into evidence in other litigation.
In the motion to compel brief, Stahl also argues that there is substantial evidence suggesting that Biller’s complaints against Toyota were accurate, since (1) Biller “remained in a senior in-house counsel position for more than a year after his internal complaints without any evident questioning of his veracity,” (2) Congress found the information in Biller’s subpoenaed documents “sufficiently compelling to warrant a formal investigation,” and (3) “the culture described by Biller is corroborated by other incidents in which Toyota has been charged by the Department of Justice for deliberately deceiving federal regulators and defrauding consumers by issuing misleading statements about safety issues.”
Toyota is asking Judge Tillery to deny the admission of the documents into evidence and keep them under seal and because they contain confidential and privileged information that Toyota has never waived and, as the 2011 arbitration award determined, Biller wrongfully released.
“As the holder of the privilege and confidentiality, only Toyota could waive the privilege and confidentiality,” Toyota’s lawyers argue in a brief. “Biller’s filing of documents did not waive Toyota’s confidentiality and privilege.
“Because the privilege and confidentiality remain, Toyota has substantial interest in ensuring that its privileged and confidential communications, litigation strategies and settlement information are not disclosed to the public and in preventing other employees or potential litigants from using this confidential and privileged information to Toyota’s disadvantage.”
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