This matter came before the Court on the Motion of Defendant South Carolina Budget and Control Board (“B&CB”) to Alter or Amend the Order of this Court filed on May 23, 2012.  The B&CB brings this motion pursuant to Rule 59(e), SCRCP.

The Court held a hearing on the Motion on September 26, 2012, and present at the hearing were John F. Beach, Esquire on behalf of Studsvik and Kenneth P. Woodington, Esquire on behalf of Defendant South Carolina State Budget and Control Board. Adam Whitsett, Esquire, Assistant Attorney General, appeared on behalf of the South Carolina Attorney General’s office, but informed the Court at the outset of the hearing that his office had no position on the B&CB’s Motion and, accordingly, did not participate in the hearing on this Motion.

The Court has heard and considered the arguments of counsel for the parties, reviewed the pleadings in this case, and reviewed the memoranda and other materials presented to the Court in support of and in opposition to Defendant B&CB’s Motion.  For the reasons set forth below, the Court denies the B&CB’s Motion to Alter or Amend.

STANDARD

In South Carolina, “[a] party may wish to file such a motion when she believes the court has misunderstood, failed to fully consider, or perhaps failed to rule on an argument or issue, and the party wishes for the court to reconsider or rule on it. A party must file such a motion when an issue or argument has been raised, but not ruled on, in order to preserve it for appellate review.” Elam v. S. Carolina Dept. of Transp., 361 S.C. 9, 24, 602 S.E.2d 772, 780 (2004) (emphases in original).

DISCUSSION AND RULING

B&CB asserts three arguments in its Motion.  The Court addresses each of B&CB’s arguments more specifically as follows:

1. The May 23, 2012 Order did not address the Board’s request that the Court order Plaintiff at least to conduct or request a review of the electronic and hard-copy files of its corporate affiliates to determine whether information missing from, or otherwise not found in, the files of the plaintiff, can be found in the files of the plaintiff’s corporate affiliates.

The May 23, 2012 Order denies B&CB’s motion to compel under the clear ground that Studsvik’s affiliates’ documents and records are “not in the possession, custody or control of the plaintiff, as required by Rule 34 of the South Carolina Rules of Civil Procedure,” Order, p. 2, and, therefore, not discoverable.

The Court expanded upon its ruling on pages 7 - 8 of the Order with the following language:

The Court finds that the B&CB has not demonstrated that the requested documents, to the extent that they exist, are in the Plaintiff's possession, custody or control. The B&CB must seek discovery of documents solely within the physical possession of any corporate affiliate of the Plaintiff through either a subpoena validly issued against such affiliate, pursuant to Rule 45, or an independent equitable discovery action asserted directly against such corporate affiliate. Accordingly, the B&CB's Motion to Compel is hereby denied.

It would be contrary to the Court’s current ruling to order that plaintiff, nevertheless, must inquire into the contents of these other companies’ hard and computer files and report the existence or non-existence of the described documents to B&CB.  Such an order would still require plaintiff to review and provide information related to electronic and hard materials that are “not in the possession, custody or control of the plaintiff, as required by Rule 34 of the South Carolina Rules of Civil Procedure.”

Neither the South Carolina Rules of Civil Procedure nor related case law support granting such relief, and the B&CB cites South Carolina legal authority supporting this part of its motion.  The Court, consequently, must deny this request.

2. The Court erred holding that the Board should follow such procedures as those set forth in the Hague Evidence Convention, instead of simply being able to get the documents from Plaintiff, which has never denied that it could obtain them from its affiliates upon request.

The South Carolina Court of Common Pleas has no jurisdiction to require parties to follow federal or international procedures, including the Hague Evidence Convention or otherwise, and the Order establishes  no such requirement.  Instead, the Order correctly cites both 1) the applicable language from Rule 34, SCRCP (in denying B&CB’s motion to compel for the reasons cited above) and 2) Rule 45, SCRCP (as the appropriate vehicle for compelling the production of documents from a non-party).   B&CB’s assertion that obtaining documents directly from a Swedish corporation three corporate entities removed from Studsvik would involve the “cumbersome and uncertain” application of federal and international law does not present appropriate reason for this Court to allow B&CB to bypass the procedures required by the SCRCP, and underscores the reason that this Court has refrained from ordering that the B&CB must take any particular approach in order to obtain documents from a third party.

B&CB first asserts that SC Rule 34(c) does not materially differ from Federal Rule 34(c).  In making this argument, B&CB ignores the Notes to the 1993 Amendment of SC Rule 34, which modified South Carolina Rule 34(c) to the current language.  The Note clearly stated the reason for this revision:

Rule 34 applies only to production from parties, and was amended specifically to provide that production from non-parties is governed only by Rule 45.

[emphasis added]

According to the B&CB, the federal cases  cited by B&CB in support of its Motion to Alter and Amend are premised upon the same notion: “[i]f a party has control over or shares control of documents with a third person, then a court can order production by means of its power over the party litigant.”  Motion to Alter or Amend, p. 7, citing Afros S.P.A. v. Krauss-Maffei Corp., 113 F.R.D. 127, 129 (D.Del. 1986).

Federal law does not control how South Carolina trial courts must rule upon the issue at hand.  The current record is likewise devoid of evidence that Studsvik has any control, shared or otherwise, over Studsvik AB’s documents.   However, even if such evidence were present, Reiland v. Southland Equipment Service, Inc. 330 S.C. 617, 500 S.E.2d 145 (Ct. App.1998), offers guidance that supplements Rule 34 and the Amendment Note quoted above, and further supports the Court’s current ruling.

While it is true that Reiland did not deal with a Motion to Compel, the Reiland Court did find that documents within the party's expert's possession, but not within the party's own possession, were not deemed “in the possession, custody or control of the party” and, therefore, not subject to discovery through a Rule 34 request for production.  In so ruling, the Court defined what it means in South Carolina for documents to be in a party’s “possession, custody and control” under Rule 34.  In that regard, the Court held:

In order for a party to be required to turn over documents pursuant to a request for production of documents, Rule 34, SCRCP, requires the documents to be "in the possession, custody or control of the party upon whom the request is served."  There is no evidence that Reiland [the responding party] received any documents from Stewart [Reiland's expert] other than the July 9, 1993 report that Southland [the requesting party] had. Therefore we agree with the trial court that Reiland did not violate the rules of discovery.  Moreover, Southland could have deposed Stewart to gain access to his documents. See Rule 30, SCRCP (permitting party to take witness's deposition and serve subpoena duces tecum designating the materials to be produced at the deposition).

[emphasis added]

The responding party in Reiland clearly had the "right, authority, or practical ability" to obtain the requested documents from its own expert.  The responding party had engaged the expert to testify in that case and was paying the expert for his services.  Even so, the South Carolina Court of Appeals ruled that, because the responding party did not physically possess those documents, the responding party was not deemed to be "in the possession, custody or control" of those documents for the purposes of South Carolina's Rule 34 and the responding party, therefore, had not violated the rules of discovery by not producing them in response to the requesting party’s Rule 34 request for production.

CONCLUSION

For the foregoing reasons, the Court hereby denies the B&CB’s Motion to Alter or Amend.

AND IT IS SO ORDERED.

This 5th day of November, 2012

Columbia, South Carolina