IN THE SUPREME COURT OF BRITISH COLUMBIA

Date: 20140707

Docket: S121870

Registry:
Vancouver

Between:

James Beise and Erin
Tierney

Plaintiffs

And

Bell Helicopter
Textron, Inc.,

Bell Helicopter
Textron Canada Limited, Rolls-Royce Corporation and MPB

Corporation

Defendants

Before:
Master MacNaughton

Reasons for Judgment

[1]            
This action arises out of a December 15, 2010 helicopter accident said
to have been caused by the failure of the No. 2 bearing in the Rolls-Royce
engine which powered the helicopter.

[2]            
Four prior accidents are said to have been caused by a similar failure
in the No. 2 bearing. After an internal investigation, Rolls-Royce concluded
that the cause of all five failures was the inability of certain No. 2 bearings
to withstand the loads imposed by the maneuvering of the helicopter.

[3]            
Rolls-Royce has been involved in litigation in the United States with
respect to at least two of the prior accidents. In particular it has litigated:
(a) Scrogin and Jean-Baptiste v. Rolls-Royce (the “Scrogin Action”); and
(b) Younan and Hessenflow v. Rolls-Royce (the “Younan Action”). I will
refer to these two actions collectively as the “U.S. Proceedings”.

[4]            
In this action, the Plaintiffs have requested that
Rolls-Royce produce depositions, affidavits, and declarations (the “requested
documents”) from the U.S. proceedings. During submissions, counsel advised that
there are no such documents in the Scrogin Action.

[5]            
Rolls-Royce does not object to producing the
requested documents but submits that disclosure be consistent with protective
orders in respect of the documents entered into by consent, between counsel in
the U.S. Proceedings, and then issued by the District Courts in California and
Connecticut.

[6]            
The terms of the protective orders were put in
evidence by the plaintiffs. Generally, they contemplate that a party to the
Scrogin or the Younan Actions may designate any document as “Confidential”
or “Confidential Subject to Export Control”, in the case of the Younan Action,
or as “Confidential” or “Export Controlled” in the Scrogin
Action.

[7]            
Rolls-Royce submits that, if the documents sought have been
marked as “Confidential”, “Confidential Subject to Export Control” or “Export
Controlled”, pursuant to the terms of the protective orders in either or both
of the U.S. Proceedings, the consent of all parties to the actions, or an order
from the respective District Court is required before Rolls-Royce can disclose
the documents. In addition, Rolls-Royce submits that in the case of documents
which are export controlled under either order, approval from the federal
government of the United States may also be required before they can be
disclosed.

[8]            
In particular, Rolls-Royce requests that any
disclosure order of this court in respect of the Younan and Scrogin Actions:

(a)   not extend to documents designated pursuant to the Younan protective
order by parties other than Rolls-Royce as “Confidential” or “Confidential Subject
to Export Control” or the information contained within those documents;

(b)   not extend to depositions, affidavits, or portions thereof, that
refer to or incorporate documents designated as “Confidential” or “Confidential
Subject to Export Control” or the information contained within those documents;

(c)   not extend to documents designated pursuant to the Scrogin protective
orderby parties other that Rolls Royce as “Confidential” or “Export Controlled”
or the information contained within those documents;

(d)   not extend to depositions, affidavits, or portions thereof, that
refer to or incorporate documents designated as “Confidential” or “Export
Controlled” or the information contained within those documents;

(e)   not extend to documents, depositions, affidavits, or portions
thereof in other proceedings that are also subject to protective or
confidentiality orders; and

(f)     be subject, in the case of documents marked “Confidential Subject to
Export Control” and “Export Controlled”, to all necessary approvals from the
federal government of the United States being obtained by the applicants.

[9]            
Rolls-Royce submits that if the plaintiffs seek disclosure broader than
that which is not opposed by Rolls-Royce, the proper course of action is for
the plaintiffs, at their own expense, to obtain the consent of all the parties
to the Younan and Scrogin Actions or apply for release of the documents in the
District Courts of California and Connecticut.

[10]        
In that regard, Rolls-Royce relies on two decisions of this court: Bryar
Law Corporation v. Samsung Electronics Co. Ltd., 2010 BCSC 1661 and Cantlie
v. Canadian Heating Products Inc., 2014 BCSC 228.

[11]        
I do not agree that this application should be decided in accordance
with either Bryar or Cantlie. In my view, those cases, which arose
in a different context, are distinguishable.

[12]        
Those cases both involved a request for disclosure of documents in class
action proceedings before certification. At that stage in class action
proceedings, there is no clear obligation on a defendant to produce relevant
documents. They may be ordered produced where they are necessary for the purposes
of the certification hearing. The general disclosure rules are not engaged in
pre-certification cases.

[13]        
In this case, Rolls-Royce is obliged by Rule 7-1 of the Supreme Court
Civil Rules to disclose documents that are in their possession or control
and could be used by any party to prove or disprove a material fact under Rule
7-1(1) or, in the broader disclosure which may be ordered, after demand, under
Rule 7-1(11). The plaintiffs have demanded broader disclosure.

[14]        
Both Bryer and Cantlie were decided on the basis of available
evidence, which was before the court, that the privacy interests of a number of
non-parties could be affected by the disclosure if ordered. The decisions
determined that the U.S. courts were better situated to deal with these privacy
issues.

[15]        
In this case, Rolls-Royce does not dispute that it is obliged to produce
the requested documents. They are relevant to a matter in issue and may
directly, or indirectly, enable the plaintiffs to advance their own case or
damage Rolls-Royce’s case or lead to a train of inquiry: Global Pacific
Concepts Inc., v. Owners Strata Plan NW 141, 2011 BCSC 172, para. 15.

[16]        
In response to the demand, Rolls-Royce has not produced any evidence
that the requested documents have been designated under the protection orders
or that the privacy or other interests of non-parties to the litigation are of
concern.

[17]        
I have concluded that the outcome of this application is determined by the
analysis in Beazley v. Suzuki Motor Corporation, 2008 BCSC 850. There
the plaintiffs alleged that there were issues with the design and safety of a
JI Tracker (“JI”), owned by them, and involved in a single vehicle accident
while driven by their son. The JI was manufactured by General Motors and the
Suzuki Motor Corporation. For current purposes, I will refer to the JI
manufacturers as “GM”.

[18]        
GM had defended litigation involving similar allegations in the U.S. The
plaintiffs in Beazley sought disclosure of certain trial and deposition
transcripts, and other documents, produced by GM in the U.S. litigation.

[19]        
GM argued that the transcripts may be subject to US confidentiality
orders. GM relied on the implied undertaking rule, explained in Juman v.
Doucette, 2008 SCC 8. Justice Goepel, then a member of this court, reviewed
various B.C. decisions in which discovery transcripts in one action were
ordered produced in a second action raising similar issues. Justice Goepel
said:

…one of the grounds upon which the defendants oppose
production is that the transcripts may be subject to a confidentiality order in
the proceedings in the United States in which they were taken. A similar
situation arose in Miller (Ed) Sales & Rentals Ltd. v. Caterpillar Tractor
Co. (1988), 90 A.R. 323 (C.A.). In that case, the court ordered the
production of depositions notwithstanding that the depositions were subject to
a confidentiality order made by the American court.

This application does not turn on
undertakings or confidentiality orders. Rule 26(1) requires the GM Defendants
to produce all relevant documents in their possession or control. The
transcripts are in their possession or control. There is no onus on the
plaintiffs to prove that the transcripts are relevant to the present
proceedings. It is sufficient that the depositions were taken in actions
closely resembling the present case and there exists a possibility of relevance
with respect to the depositions. Transcripts of what representatives of the GM Defendants
said on prior occasions may lead to a train of enquiry which could advance that
plaintiffs’ case or damage that of the GM Defendants. The transcripts are
relevant documents and…must be produced. (paras. 26-29)

[20]        
Justice Goepel’s decision was upheld by the Court of Appeal: Beazley
v. Suzuki Motor Corporation, 2009 BCCA 57 where Justice Ryan, on behalf of
the court said:

…I do not consider the order impugned in this appeal as the
last word on the disclosure of documents from other litigation

It would also be open to [the
case management judge], upon evidence as to the nature of any ‘protection
orders’, if there be any, to consider the requirements of comity and the
desirability of accommodating the terms of any such order, as may be
appropriate.

[21]        
Although decided under the former civil rules, Justice Goepel’s
reasoning continues to be persuasive.

[22]        
In this case, the requested documents are in Rolls-Royce’s possession
and control. The requested documents were created in litigation arising out of
accidents which Rolls-Royce engineers determined were similarly-caused. All the
lawsuits raise common issues about the design of the engines and the cause of
the failures. While Rolls-Royce has argued that the documents sought by the
plaintiffs may the subject of a consent protection in the U.S. proceedings,
they have not provided any evidence that the documents sought are, in fact, the
subject of a protection order.

[23]        
In the circumstances, the obligation is on Rolls-Royce to produce the
documents. If Rolls-Royce is of the view that such production will breach a U.S.
protection order, then the burden is on it to establish that fact and to take
the steps, if necessary, to obtain consent or a court order. The burden is not
on the plaintiffs to seek the necessary consents or court orders.

[24]        
Finally, on October 30, 2012, Master Caldwell granted a consent confidentiality
order in this action but required the parties to designate documents as ‘confidential’
before they became subject to his confidentiality order. The plaintiffs say,
and Rolls-Royce does not dispute, that Rolls-Royce has not designated any
documents in accordance with Master Caldwell’s order. The plaintiffs also say,
and Rolls-Royce does not dispute, that it has already produced documents in this
litigation which are stamped “Export Controlled” without designating them as
confidential. As the designation “Export Controlled” can only refer to the
terms of the protection orders in either of the U.S. Proceedings, absent any
evidence or argument to the contrary, Rolls-Royce is presumably satisfied that
the implied undertaking in these proceedings provides it with sufficient protection.

[25]        
In all these circumstances, I order Rolls-Royce to produce the documents
sought by the plaintiffs.

[26]        
As the plaintiffs have succeeded in this application, they are entitled
to their costs.

“Master MacNaughton”