Opinion
Case No. 1:01-CV-213
November 26, 2001
OPINION
This matter is before the Court on the Motion for Protective Order, (Dkt. #7), filed by former counsel for Third-Party Defendant, Hamlin. Plaintiff's counsel opposes the Motion. For the reasons articulated herein, the Court grants in part counsel's request for a protective order.
BACKGROUND
The present action has its genesis in a state court case brought by Joy Kline against Cecil Hamlin and Builders Transport, Inc. (BTI), both of whom were represented by attorney Michael Bogren of Plunkett Cooney, PC. Following the entry of judgment for Plaintiff in the state case, the present garnishment action was filed. Plaintiff's attorney in this matter, having obtained from Hamlin an authorization for release, requested that Mr. Bogren release to him the entire file created in the course of defending Hamlin and BTI in the state court proceeding.
Mr. Bogren subsequently communicated to "all concerned" his intent to comply with counsel's request. Counsel for BTI, however, objected to the release of this information, asserting that the contents of the file are privileged from such disclosure. Accordingly, Mr. Bogren brings the present motion. Further asserting that he is likely to be deposed in the present matter, Mr. Bogren requests that any protective order also preclude examination of any matters regarding which the Court finds the assertion of privilege applicable.
ANALYSIS
Generally speaking, parties may obtain discovery regarding any relevant, nonprivileged matter. See Fed.R.Civ.P. 26(b)(1). Asserting that disclosure of the information at issue is protected by the attorney-client privilege, as well as the work product doctrine, BTI claims that such information is not discoverable. The burden of establishing the applicability of these protections rests with BTI. See, e.g., Hawkins v. Stables, 148 F.3d 379, 383 (4th Cir. 1998); Collins v. Mullins, 170 F.R.D. 132, 134 (W.D.Va. 1996).
The Court notes that in its response to the present motion, BTI focused its argument on the work product doctrine, only briefly discussing the attorney-client privilege. However, in its communication to Mr. Bogren objecting to the release of the information at issue, BTI specifically referenced both the attorney-client privilege and the work product doctrine. Accordingly, while BTI has more strongly argued the application of the work product doctrine, it has not waived any argument that the attorney-client privilege also applies.
As this is a diversity action, federal law governs the applicability of the work product doctrine, whereas state law provides the parameters of the attorney-client privilege. See Fed.R.Evid. 501; Fed.R.Civ.P. 26(b)(3); see also, Travelers Casualty and Surety Co. v. Excess Ins. Co. Ltd., 197 F.R.D. 601, 605 (S.D.Ohio 2000); Royal Surplus Lines Ins. v. Sofamor Danek Group, 190 F.R.D. 463, 471 (W.D.Tenn. 1999) (citing United Coal Companies v. Powell Construction, 839 F.2d 958, 966 (3rd Cir. 1988)).
I. Work Product
Generally speaking, work product consists of "the files and the mental impressions of an attorney reflected, of course, in interviews, statements, memoranda, correspondence, briefs, mental impressions, personal beliefs, and countless other tangible and intangible ways[,] prepared in anticipation of litigation." United States v. One Tract of Real Property Together with all Buildings, Improvements, Appurtenances, and Fixtures, 95 F.3d 422, 427 (6th Cir. 1996) (citations omitted).
While the work product doctrine is often referred to as a "privilege," such is a misnomer, as it is actually a "qualified immunity protecting from discovery documents and tangible things prepared by a party or his representative in anticipation of litigation." In re Perrigo Co., 138 F.3d 430, 437 (6th Cir. 1997). The protection afforded work product is articulated by Federal Rule of Civil Procedure 26(b)(3). As the Supreme Court has recognized, however, "the literal language of the Rule protects materials prepared for any litigation or trial as long as they were prepared by or for a party to the subsequent litigation." Federal Trade Commission v. Grolier, Inc., 462 U.S. 19, 25 (1983).
A non-party may not, therefore, claim the protection of the work product doctrine. See, e.g., Arkwright Mutual Ins. Co. v. National Union Fire Ins. Co. of Pittsburgh, Pa., 19 F.3d 1432, 1994 WL 58999 at *4 (6th Cir., Feb. 25, 1994) (quoting In re California Pub. Util. Comm'n, 892 F.2d 778, 781 (9th Cir. 1989)) (the protection afforded by Rule 26(b)(3) is limited to one who is a party "to the litigation in which discovery is sought"); Collins, 170 F.R.D. at 137 (a non-party "may not utilize the work product doctrine"); Loustalet v. Refco, Inc., 154 F.R.D. 243, 247 (C.D.Calif. 1993) (same); Johnson v. Standex Int'l Corp., 153 F.R.D. 80, 83 (E.D.Va. 1994) (same); Wright, Miller Marcus, Federal Practice and Procedure: Civil 2d § 2024 (same).
Accordingly, since BTI is not a party to the present action, it lacks standing to assert the protection of the work product doctrine. Even if BTI had standing, however, the result would likely be the same, given that work product belongs to the client. See, e.g., Spivey v. Zant, 683 F.2d 881, 885 (5th Cir. 1982) (the work product doctrine is inapplicable where "a client seeks access to documents or other tangible things created or amassed by his attorney during the course of the representation"); Gottlieb v. Wiles, 143 F.R.D. 241, 247 (D.Colo. 1992) ("[a]n attorney may not withhold work product from his own client").
Moreover, the fact that the work product at issue was created in the course of Mr. Bogren's joint representation of Hamlin and BTI is of no significance, because work product created "during the joint representation of a number of clients," belongs "jointly to the clients in question, with each having an undivided ownership interest in, and equal right of access to," such work product. In re Michigan Boiler and Engineering Co., 87 B.R. 465, 468-69 (Bankr.E.D.Mich. 1988) (citations omitted); Martin Marietta Corp. v. Fuller Co., 1986 WL 12424 at *5 (E.D.Pa., Oct. 31, 1986) (same).
The Court has also given consideration to the question of whether Reliance National Indemnity Company, defendant in a closely related but not consolidated case (Case No. 4:01-CV-52) ("Reliance"), has standing to object to the production of the material regarding which Mr. Bogren, on BTI's behalf, asserts a work product immunity from discovery. Reliance hired Plunkett Cooney by Mr. Bogren to represent BTI and Hamlin in the underlying state wrongful death case. According to counsel for Reliance, the only apparent reason for obtaining Mr. Bogren's file is to pursue a claim against Reliance for bad faith in the settlement process of the underlying state case. Reliance is subject to an October 3, 2001 Order of Liquidation in the Commonwealth Court of Pennsylvania. (No. 269 M.D. 2001). According to counsel for Reliance, the Court should grant Plunkett Cooney's request as a matter of comity because the Liquidation Order requires all claims against Reliance be brought in the liquidation proceeding. Reliance asserts that privileges asserted in the files of Plunkett Cooney are an asset belonging to Reliance. This Court certainly neither wishes nor intends to interfere with the Pennsylvania liquidation proceeding. However, even if the work product immunity asserted by Plunkett Cooney is an asset of Reliance under Fed.R.Civ.P. 26 , it is jointly an asset of Hamlin's. Further, the Court's disposition regarding the work product issue accords appropriate respect to the Order of Liquidation by limiting the use of the material to this litigation.
The Court had previously stayed the case of Kline v. Reliance National Indemnity Company, Case No. 4:01-CV-52, as to Reliance pursuant to an Order of Rehabilitation.
Rule 26(b)(3) accords work product protection to material prepared in anticipation of litigation or for trial by or for another party or by or for, inter alia, a party's insurer.
In objecting to the disclosure of the material at issue, BTI has also expressed concern regarding its involvement in other litigation. While not clearly articulated, BTI's concern appears to be that, if the material at issue is disclosed to others, it may prejudice its participation in these other matters. This is certainly a legitimate concern. See Wright, Miller Marcus, Federal Practice and Procedure: Civil 2d § 2024 (recognizing that precluding a non-party from invoking the work product doctrine may prejudice that non-party in other matters).
As indicated above, BTI cannot presently assert the protection of the work product doctrine and, therefore, Hamlin is entitled to those portions of Mr. Bogren's file which constitute work product. However, pursuant to Federal Rule of Civil Procedure 26(c), the Court conditions the discovery of this material as follows: (1) Hamlin may reveal this material only to Plaintiff's counsel, and his own counsel, should he decide to employ counsel; (2) counsel may reveal this material only to those individuals to whom disclosure is necessary to adequately pursue Plaintiff's or Hamlin's claims in this litigation; (3) to the extent that any of this material is submitted to the Court (in whatever form) it shall be submitted under seal, so as to prevent its disclosure to the public at large; and (4) all individuals to whom this information is disclosed shall be bound by these conditions.
II. Attorney-Client Privilege
As indicated above, when evaluating a claim of attorney-client privilege in a diversity action, the Court must look to state law specifically that State's law which governs the underlying action. As the claims asserted in the underlying complaint, as well as the third-party complaint, assert violations of various Michigan statutes, it is the law of Michigan to which the Court must turn to evaluate the applicability of the attorney-client privilege in this matter.
Pursuant to the Michigan Rules of Evidence, questions of privilege are "governed by the common law, except as modified by statute or court rule." Mich. R. Evid. 501. While there exists Michigan statutory authority regarding the attorney-client privilege, reliance on such appears irrelevant. First, this particular statute appears in the Michigan Code of Criminal Procedure and is not a modification of the general common law principle, but instead simply a codification thereof. Mich. Comp. Laws § 767.5a. Moreover, as common law privileges are generally interpreted more broadly as compared to statutory privileges, it is the broader parameters of the common law privilege to which the Court must look. See People v. Underwood, 535 N.W.2d 484, 489 (Mich. 1995) (Levin, J. dissenting) (recognizing that statutorily created privileges are more narrowly interpreted); Lindsay v. Lipson, 116 N.W.2d 60, 62 (Mich. 1962) (noting that the common law attorney-client privilege is accorded a more liberal interpretation).
The attorney-client privilege protects "confidential communications by the client to his adviser which are made for the purpose of obtaining legal advice." Yates v. Keane, 457 N.W.2d 693, 694 (Mich.Ct.App. 1990). There does not appear to be a dispute regarding whether the communications at issue were made for the purpose of obtaining legal advice. Rather, the issue is whether the circumstances in which the communications were made served to waive the attorney-client privilege. Specifically, Plaintiff asserts that because BTI and Hamlin shared the same attorney, BTI would have had no expectation of confidentiality regarding its communications with Mr. Bogen vis a vis Hamlin.
As part of his motion for protective order, Mr. Bogren has submitted to the Court the contents of the file at issue, as well as a privilege log identifying the communications for which a privilege is asserted. The Court has conducted an in-camera review of the communications allegedly protected by the attorney-client privilege, the results of which are detailed below.
In support of his position, Plaintiff's counsel relies on Denby v. Dorman, 246 N.W. 206 (Mich. 1933). This case, however, fails to support counsel's position. In Denby, the parties had entered into a written contract, regarding which a dispute later arose. Id. at 206-07. With respect to the negotiations which preceded execution of the contract, the plaintiffs were represented by counsel, who negotiated directly with the defendants. Id. at 207.
When the contract dispute was litigated, the plaintiffs sought to introduce testimony from their attorney regarding statements made by the defendants during the negotiation of the contract. The defendants asserted that such communications were protected from disclosure by the attorney-client privilege. In this respect, the court indicated that if counsel "was acting for both of them [in the context of the contract negotiations], no privilege attached to the communications between them relative thereto." Id.
Because the plaintiffs' counsel had also "been acting for the defendants in certain matters prior to that time," there was a question as to whether the defendants were representing themselves in the contract negotiation (and were communicating with counsel in such capacity) or whether counsel was, in fact, representing both parties in the negotiation of the contract.
In other words, because the parties in Denby were "separately interested" regarding the matter (i.e., the negotiation of the contract in dispute), if both parties were represented by the same attorney, no privilege attached to the communications between them " relative thereto." This simply means that in such a circumstance, neither party can keep secret from the other the communications at issue.
Such is the case because, as Plaintiff's counsel, citing to McCormick on Evidence correctly notes, "where two parties separately interested in some contract or undertaking engage the same attorney to represent their respective interests, and each communicates separately with the attorney the communicating client would not ordinarily intend that the facts communicated should be kept secret from [the other party]." The present circumstance, however, is distinguishable from the authority cited by counsel in an important, and ultimately dispositive, respect. Moreover, the authority relied upon by counsel fails to adequately address the issue presented here.
Significantly, BTI is not seeking to prevent disclosure to Hamlin of the communications at issue, but is instead asserting the attorney-client privilege to the extent that Hamlin seeks to reveal such communications to Plaintiff's counsel. Thus, the relevant question is not whether it was reasonable for BTI to expect its communications to counsel to be kept secret from Hamlin, but whether such communications were made under circumstances which constitute a waiver of the attorney-client privilege in relation to third parties.
In this respect, as counsel correctly notes, when Mr. Bogren undertook to represent Hamlin and BTI, they "had the same interests, at least at that point in the litigation." Thus, while Denby, as well as the example from McCormick, involve circumstances in which the relevant individuals were "separately interested" in the matter, Hamlin and BTI shared (at least during the relevant time period) a common interest in the matter.
As has been recognized, the rule in Michigan is that "when two persons employ a lawyer as their common agent, their communications to him as strangers will be privileged, but as to themselves, they stand on the same footing as to the lawyer and either can compel him to testify against the other" regarding communications made in the course of the common representation. Grand Trunk Western R. Co. v. H. W. Nelson Co., Inc., 116 F.2d 823, 835 (6th Cir. 1941) (citing to Denby v. Dorman and other Michigan cases, to support its interpretation of Michigan privilege law); see also, Megan-Racine Assoc., Inc. v. Niagara Mohawk Power Corp., 189 B.R. 562, 571 (Bankr.N.D.N.Y. 1995) (when a client communicates to his attorney in the presence of a third party, such communications are generally not protected by the attorney-client privilege, however, the "joint-defense privilege acts as an exception to these general waiver rules in order to facilitate cooperative efforts among parties who share common interests"); IBJ Whitehall Bank Trust Co. v. Cory Assoc., Inc., 1999 WL at *3 (N.D.Ill., Aug. 12, 1999) (same); Loustalet, 154 F.R.D. at 247 (same).
Plaintiff's counsel also asserts, incorrectly, that he is entitled to the information at issue because Hamlin has executed a "limited waiver of his [attorney-client] privilege." Because the attorney-client privilege is in this instance held jointly by Hamlin and BTI, any waiver must be effected by both parties. See, e.g., In re Grand Jury Subpoenas, 89-3 and 89-4, John Doe 89-129, 902 F.2d 244, 245-50 (4th Cir. 1990); Sobol v. E.P. Dutton, Inc., 112 F.R.D. 99, 104 (S.D.N.Y. 1986).
Accordingly, BTI may assert the attorney-client privilege with respect to its communications with Mr. Bogren. The Court has conducted an in-camera inspection of the communications to which the attorney-client privilege has been asserted. In conducting this review, the Court notes that in Michigan there exists no attorney-client relationship between "an insurance company and the attorney representing the insurance company's insured." Kirschner v. Process Design Assoc., Inc., 592 N.W.2d 707, 598 (Mich. 1999). Application of this principle makes inapplicable the claim of privilege asserted as to a significant number of documents. The Court also notes that many of the documents to which privilege has been asserted contain no information or communication which is made for the purpose of obtaining legal advice (e.g., facsimile cover sheets which contain no information or communication). Nor do they reflect any such communication as in the case where a communication, i.e., advice by the attorney, is protected because the advice reflects, albeit indirectly, the client's communication regarding a legal concern. Specifically, the Court concludes that with respect to the following documents, the attorney-client privilege is properly invoked: # 37, 38, 39, 45, 50, 93, 94, 95, 109, 115, 116, 132, 135, 136, 137, 179, 191, 192, 194, 202, 205, 206, 208, 216, 221, 222.
The Court has identified the documents by reference to their numeric position in the privilege log. The Court notes that document No. 24, with a date of March 13, 2001, was missing from the documents provided for in camera review by Plunkett Cooney. However, no privilege is claimed regarding this document.
To the extent that counsel can redact from these documents the privileged information, he shall do so and disclose such to Hamlin. As for any such documents which cannot be so redacted, such shall not be disclosed to Hamlin or Plaintiff's counsel. With respect to the remaining documents (i.e., those to which no attorney-client privilege attaches), such may be provided to Hamlin.
Disclosure of such communications, however, will be pursuant to the same conditions identified above: (1) Hamlin may reveal this material only to Plaintiff's counsel, and his own counsel, should he decide to employ counsel; (2) counsel may reveal this material only to those individuals to whom disclosure is necessary to adequately pursue Plaintiff's or Hamlin's claims; (3) to the extent that any of this material is submitted to the Court (in whatever form) it shall be submitted under seal, so as to prevent its disclosure to the public at large; and (4) all individuals to whom this information is disclosed shall be bound by these conditions.
III. Deposition of Mr. Bogren
Mr. Bogren asserts that he expects to be deposed by Plaintiff regarding his prior representation of Hamlin and BTI. Accordingly, he seeks guidance from the Court as to how to proceed in such an event. Without knowing the precise questions which Mr. Bogen is likely to face, however, it is difficult to provide specific guidance.
All concerned are certainly familiar with the applicable rules of procedure and professional responsibility. The Court is confident that such understanding, interpreted in light of the Court's opinion, will adequately guide the parties. However, should Plaintiff determine it necessary to depose Mr. Bogren, the parties may coordinate with the Court to schedule any such deposition for a date on which the undersigned will be available by telephone to resolve any disputes which may arise.
An order consistent with this opinion shall issue.
ORDER
For the reasons articulated in the Opinion filed this day:
IT IS HEREBY ORDERED that the Motion for Protective Order filed by former counsel for Third-Party Defendant, Hamlin (Dkt. 7) is GRANTED in part and DENIED in part. Plunkett Cooney shall produce all non-privileged and all redacted privileged documents within twenty-one (21) days of the date of this Order.