Wal-Mart Seeks to Protect Investigator’s Documents

To follow up on our previous blog, “Wal-Mart and Investors Contest Privileged Docs Regarding Bribery Scandal,” Wal-Mart Stores Inc. (“Wal-Mart” or the “Company”) has urged U.S. District Court Judge Susan Hickey to reverse her decision earlier this month that would allow shareholders to depose and gather documents from Ronald Halter, a former FBI investigator hired by Wal-Mart to look into the allegations that its Mexican operation ran on bribes.

The shareholders are led by the City of Pontiac General Employees’ Retirement System (“PGERS”), which is a retirement fund. PGERS is seeking to recover damages related to the fall in stock price that occurred in response to the report published by The New York Times on April 21, 2012 accusing Wal-Mart of using bribes to fuel its growth in Mexico, and by attempting to cover up the findings from its internal investigation into the matter. Accordingly, Wal-Mart allegedly misled investors by not disclosing the extent of the bribery in a report filed by the Company with the U.S. Securities and Exchange Commission in December 2011.

On May 5, 2017, Judge Hickey concluded that Halter’s reports on Wal-Mart’s Mexican operations “simply recounted facts” and were not protected by attorney-client privilege or work product privilege, which would allow PGERS to depose and gather documents from him. Judge Hickey also pointed to the fact that the Company failed to file an affidavit in order to establish privilege. Wal-Mart, however, said it would be “manifestly unfair” for its leaked documents to wind up in the plaintiffs’ hands simply because it did not file an affidavit. The Company has said that the exposure of the documents could spook the members of its audit committee, and that competitors could get a leg-up from the internal communications at issue.

Two weeks after Judge Hickey’s order, PGERS accused Wal-Mart of unjustly delaying the proceedings, asking the Court to sanction Wal-Mart $1,000 on the first day it was late in turning over Halter’s documents, $2,000 on the second day, and so on. The shareholders equated the Company’s actions to “obstructionism,” and called attention to the fact that the case was progressing quite slowly.

The legal team at SFMS has significant experience litigating securities matters. If you have any questions regarding this subject or this posting, please contact Nick Lussier (nlussier@sfmslaw.com) or Chiharu Sekino (csekino@sfmslaw.com). We can also be reached toll-free at (866) 540-5505.

Shepherd, Finkelman, Miller & Shah, LLP is a law firm with offices in California, Connecticut, Florida, New Jersey, New York, and Pennsylvania. SFMS is an active member of Integrated Advisory Group (www.iaginternational.org), which provides us with the ability to provide our clients with access to excellent legal and accounting resources throughout the globe. For more information about our firm, please visit us at www.sfmslaw.com.


Barstow, David. “Vast Mexico Bribery Case Hushed Up by Wal-Mart After Top-Level Struggle.” The New York Times. Last modified on April 21, 2012.

Hays, Kali. “Wal-Mart Investor Seeks Class Cert. In Mexico Bribery Suit.” Law360. Last modified on November 4, 2015.

Newsham, Jack. “Wal-Mart CEO Can Be Deposed In Mexico Bribery Case.” Law360. Last modified on May 11, 2017.

Newsham, Jack. “Wal-Mart Pushes Court To Protect Bribe Investigators’ Notes.” Law360. Last modified on May 23, 2017.