Thank you for sharing!

Your article was successfully shared with the contacts you provided.
Click here for the full text of this decision FACTS: In this mandamus proceeding, the court decides a question of first impression regarding the proper interpretation and application under the Texas Rules of Civil Procedure of the phrase “possession, custody, or control.” Texas Rules of Civil Procedure 192.3(b), 192.7(b). The respondent trial court, in an action filed against relator Hal Kuntz in his individual capacity, ordered Kuntz to produce documents that he had access to at his place of employment. It was undisputed that Kuntz’s employer had actual physical possession of the relevant documents, that the documents were owned by a client of Kuntz’s employer, and that the client claimed the documents contained its privileged trade secrets. In this court, Kuntz asserts that his mere ability to access the documents does not constitute possession, custody, or control. HOLDING: Conditionally granted. Texas Rule of Civil Procedure 192.3 is entitled “Scope of Discovery.” Rule 192.3(a) provides: “In general, a party may obtain discovery regarding any matter that is not privileged and is relevant to the subject matter of the pending action. . . .” Rule 192.3(b) provides: “A party may obtain discovery of the existence, description, nature, custody, condition, location, and contents of documents and tangible things . . . that constitute or contain matters relevant to the subject matter of the action. A person is required to produce a document or tangible thing that is within the person’s possession, custody, or control.” Texas Rule of Civil Procedure 192.7(b) sets forth the following definition: “Possession, custody, or control of an item means that the person either has physical possession of the item or has a right to possession of the item that is equal or superior to the person who has physical possession of the item.” Hal’s mere access to the relevant letters of recommendation does not constitute “physical possession” of the documents under the definition of “possession, custody, or control” set forth in Texas Rule of Civil Procedure 192.7(b). The trial court abused its discretion in ordering Hal to produce the documents. If required to produce the relevant letters of recommendation, Hal would be forced to violate the confidentiality provisions contained in both an operating agreement and a consulting agreement, potentially subjecting himself to a suit for significant damages. See, e.g., IBP, Inc. v. Klumpe, 101 S.W.3d 461 (Tex.App. � Amarillo 2001, pet. denied). Because an appellate court would not be able to cure the trial court’s discovery error, the court further concludes that Hal does not have an adequate remedy by appeal. OPINION: Smith, J.; Phillips, C.J., Hecht, Owen, Jefferson, Schneider, Wainwright and Brister, JJ., join. O’Neill concurred in the judgment only. CONCURRENCE: Hecht, J., filed a concurring opinion, in which JUSTICE Owen, J., Schneider, J., and Wainwright, J., joined. “I agree that Vesta Kuntz is not entitled to have her ex-husband, Hal Kuntz, produce letters of recommendation (“LORs’) that his employer prepared for its client because he does not have”possession, custody, or control’ of the documents within the meaning of Rule 192.3(b) of the Texas Rules of Civil Procedure. But Vesta has not merely sought discovery from the wrong person. She is not entitled to production of the LORs because they are privileged trade secrets under Rule 507 of the Texas Rules of Evidence and she has not established, as she must, that they are essential to the fair adjudication of her claims. So while I join fully in the Court’s opinion, I would reach the same result for this additional reason.” CONCURRENCE: Wainwright, J., filed a concurring opinion. “In this case the Court decides whether a party may be ordered to produce documents containing trade secrets when the party does not own the documents or the trade secrets and claims not to have possession, custody or control of them. “This discovery dispute arose in post-divorce proceedings between Vesta Frommer and Hal Kuntz. As a just division of the parties’ property, Vesta and Hal entered an Agreement Incident to Divorce (“AID’), which the trial court approved. Under the AID, Vesta had”the right to 25% of all overriding royalty interests, if any, from MOXY assigned to Husband [Hal Kuntz] after the date of divorce that results from projects on which CLK forwarded letters of recommendation to MOXY to drill during the marriage.’ Hal was an owner and general manager of CLK Company, L.L.C. (“CLK’), which provided letters of recommendation (“LORs’) to McMoran Offshore Exploration Co. (“MOXY’) of potential oil and gas exploration and drilling opportunities primarily in the Gulf of Mexico. Based on the AID, Vesta sought to obtain all of the approximately 1,800 LORs with positive recommendations that CLK sent to MOXY during her 15 year marriage to Hal. Hal, CLK, and MOXY objected. . . .” “While it is unclear why Vesta sought the documents from Hal rather than MOXY, and notwithstanding our regard for the diligent inquiry and complex decisions made by the trial court, I agree with the Court’s opinion. I do not disagree with the implication in the opinion of the Court that the documents should be obtained, if at all, from MOXY. “I note, however, that if this Court’s decision had been adverse to MOXY’s position, then as the proceeding continued in the trial court, MOXY may have had a difficult time attempting to obtain a different ruling. MOXY had notice and fully participated in the prior proceedings at the trial court over production of the LORs. Given the circumstances, a second bite at the apple may have been hard to come by.”

Want to continue reading?
Become a Free ALM Digital Reader.

Benefits of a Digital Membership:

  • Free access to 1 article* every 30 days
  • Access to the entire ALM network of websites
  • Unlimited access to the ALM suite of newsletters
  • Build custom alerts on any search topic of your choosing
  • Search by a wide range of topics

*May exclude premium content
Already have an account?

Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.