KRISTEN L. MIX, Magistrate Judge.
This matter is before the Court on Defendants Broad and Cassel, Carl Romano and Ronald Gaché's (the "Broad Defendants") privilege logs and in camera production of documents [#538, #538-3, #538-4, #538-5].
As described by the District Judge, the allegations involved in this case are as follows:
See Order on Pending Motions — No. 3 [#406] at 1-2.
As mentioned above, the Broad Defendants consist of a Florida law firm, Broad and Cassel, and two of its partners, Ronald Gaché and Carl Romano. In 2008, the firm represented one of Hutchens' entities known as 308 Elgin Street, Inc. ("308 Elgin").
Plaintiffs' claims against the Broad Defendants were dismissed without prejudice by Order [#513] of the Court dated January 27, 2015. Plaintiffs and the Broad Defendants subsequently entered into a "Stipulation of Settlement," which was approved by the court on August 5, 2015. Order [#560].
The procedural history of the discovery dispute addressed in this Order is complicated. In response to Plaintiffs' request for production of documents, the Broad Defendants asserted various legal bases for protection of certain documents, and eventually submitted approximately 1500 pages to the Court for in camera review.
As outlined by the Broad Defendants, the dispute arose as follows:
[#538] at 2-3. The Broad Defendants' post-appeal, post-settlement response to the outstanding Requests for Production consists of the privilege logs and documents at issue here. See [#538-3, #538-4, #538-5]. The privilege logs recite the "joint defense privilege," "common interest doctrine," and attorney work product as the basis for withholding documents. The documents were provided to the Court on compact discs and reviewed in camera.
Plaintiffs make no arguments regarding the applicability of the "joint defense privilege" to the documents provided by the Broad Defendants. Nor do they oppose the Broad Defendants' request for an in camera review of the documents listed on the three privilege logs at issue. See Plaintiffs' and Class Members' Response to Defendant Meisels' and the Broad Defendants' Status Reports and Revised Privilege Logs and Response (sic) to the Hutchens' Defendants' Response to Order to Show Cause [#547] at 9, 10.
In federal court, the phrase "joint defense privilege" has frequently been used to refer to two closely-related, but nevertheless separate, legal privileges known as the "joint client privilege" and the "common interest rule privilege." "The "joint client privilege" applies when clients or parties share the same lawyer; the "common interest rule privilege" applies "when parties with separate lawyers consult together under the guise of common interest or defense." Sec. Inv'r Prot. Corp. v. Stratton Oakmont, Inc., 213 B.R. 433, 435 n.1 (Bankr. S.D.N.Y. 1997). The courts frequently combine the separate situations addressed by the joint client privilege and the common interest rule privilege into a single concept most frequently referred to as the "joint defense privilege." As this Court has held:
Metro Wastewater Reclamation Dist. v. Cont'l Cas. Co., 142 F.R.D. 471, 478-479 (D. Colo. 1992) (internal citations omitted). Thus, in order to establish that the joint defense privilege protects documents from discovery, the movant must show: (1) the documents are protected by the attorney-client privilege and/or the work product doctrine; (2) there was existing litigation or a strong possibility of future litigation at the time of the communications reflected in the documents;
The attorney-client privilege protects communications made in confidence between a client and his attorney, but not the underlying facts contained within those communications. E.E.O.C. v. Outback Steakhouse, Inc., 251 F.R.D. 603, 610 (D. Colo. 2008). "The privilege extends to confidential communications by or to the client in the course of gaining counsel, advice, or directions with respect to the client's rights or obligations." Mountain States Tel. & Tel. Co. v. DiFede, 780 P.2d 533, 541 (Colo. 1989) (citations omitted).
The work product doctrine protects documents that are prepared in anticipation of litigation or for trial unless they are otherwise discoverable under Fed. R. Civ. P. 26(b)(1) and the requesting party shows that it has substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means. Fed. R. Civ. P. 26(b)(3)(A). "At its core, the work product doctrine shelters the mental processes of the attorney, providing a privileged area within which he can analyze and prepare his client's case." United States v. Nobles, 422 U.S. 225, 238 (1975).
The Broad Defendants assert that the documents listed on the privilege log docketed at #538-3 ("Privilege Log #538-3") are protected by "joint defense/common interest." [#538-3] at 1, 2. In their Status Report Regarding Production of Documents and Privilege Logs, they assert that the privilege logs generally list either "documents that involve communications between the Broad Defendants and other Defendants in this lawsuit," or "documents that involve the Broad Defendants': a) work product protected internal communications; b) attorney-client privileged communications between the Broad Defendants and their outside attorneys; c) an investigative file generated in anticipation of litigation; 4) [sic] investigative work product or attorney-client privileged communications between the Broad Defendants and their client; and 5) [sic] investigative work product communications with third parties in anticipation of litigation." [#538] at 3, 4.
Thus, as far as the undersigned can determine from piecing together the various filings relating to the Broad Defendants' desire to claim protection from discovery for the documents listed on Privilege Log #538-3, the chronology is as follows: the Broad Defendants were hired to represent 308 Elgin, a Hutchens entity. During their representation they became aware of allegations of fraud against Hutchens made on the internet. The accusing website apparently also made allegations of wrongdoing against the Broad Defendants. Instead of disclosing Hutchens' criminal background in the course of representing 308 Elgin, they vouched for his business and professional integrity and facilitated the payment of a $265,000 advance fee to him or his entities. A meeting occurred on September 14, 2008, between the Broad Defendants and Alvin Meisels, an attorney for Hutchens. On an unknown subsequent date in September, the Broad Defendants withdrew from representing 308 Elgin. On an unknown date in 2008, the Broad Defendants hired attorney Issac J. Mitrani to investigate the internet allegations against the Broad Defendants and to provide advice to the Broad and Cassel law firm. According to Mr. Gaché, "[i]n early 2009, [the] Broad [Defendants] contemplated that there might be litigation arising out of Hutchens' activities." [#561-1] at 2 (emphasis added).
The documents on Privilege Log #538-3 reflect communications dated between January 14, 2009, and May 25, 2009. The emails were sent between the Broad Defendants and Hutchens (who is identified as "Private Lender") about the internet allegations of wrongdoing. Mr. Mitrani, the Broad Defendants' attorney, is not a sender or receiver of any of the emails listed on Privilege Log #538-3. These emails therefore involve communications (a) by or to an attorney who had his own counsel (b) about allegations of wrongdoing against the attorney and others (c) by or to the attorney's former client. As for the required showing of existing litigation or the strong possibility of future litigation, although Gaché's affidavit does not specifically provide information about litigation in connection with Privilege Log #583-3, it nevertheless states that the Broad Defendants were sued in Florida state court "in summer 2009" regarding their representation of 308 Elgin about loan commitments to a different borrower, the Oxley Companies. [#561-1] at 2.
As discussed above, in order to sustain their burden of showing that the joint defense privilege applies, the Broad Defendants are obligated to show that the documents are protected by the attorney-client privilege or work product doctrine. None of the documents listed on Privilege Log #538-3 appears to be protected by the attorney-client privilege for two reasons. First, the emails were sent in 2009, after the Broad Defendants ceased representing 308 Elgin. As a result, Hutchens was no longer an agent for a "client" of the firm, and these communications were therefore not made during the existence of an attorney-client relationship. United States v. Tilga, No. 09-CR-865JEC, 2010WL737027 (D.N.M. Feb. 17, 2010) (finding absence of attorney-client relationship precluded application of attorney-client privilege); "Existence of Attorney-Client Relationship," 48 Am. Jur. Proof of Facts 525, § 5 ("In general, however, the applicability of the attorney-client privilege depends on the existence of an attorney-client relationship as of the time the communications at issue were made."). Second, the emails were sent for purposes other than obtaining legal advice. See, e.g., Losavio v. Dist. Court, 533 P.2d 32, 35 (Colo. 1975) (holding attorney-client privilege "is established by the act of a client seeking professional advice from a lawyer and extends only to confidential matters communicated by or to the client in the course of gaining counsel, advice or direction with respect to the client's rights and obligations.").
Given the inapplicability of the attorney-client privilege to the documents listed on Privilege Log #538-3, they must qualify as work product to be protected by the "joint defense privilege." In order to be "work product," they must have been "prepared in anticipation of litigation or for trial." Fed. R. Civ. Pro. 26(b)(3)(A). Indeed, Courts in this district generally require a showing that the work at issue was prepared due to "the real and imminent threat of litigation." Plaza Ins. Co. v. Lester, No. 14-cv-0162-LTB-CBS, 2015 WL 3528336, at *6 (D. Colo. June 4, 2015). Mr. Gaché's affidavit refers to the litigation eventually filed by the Oxley Companies "in summer of 2009," but does not connect that litigation to the documents listed on Privilege Log #538-3. Instead, he explains that the Oxley lawsuit is the basis for his assertion of privilege "in the log filed at #538-4." [#561-1] at 2. As mentioned above, Gaché's only explanation of the context of the emails listed in Privilege Log #538-3 is that a broker had published allegations of wrongdoing against the Broad Defendants on the internet in September 2008. [#561-1] at 1. Even crediting Gaché's statement that he and Hutchens communicated "beginning in early 2009 . . . concerning our then-common interest in addressing the [internet] allegations" and that he "contemplated that there might be litigation arising out of Hutchens' activities," [#561-1] at 1-2, the possibility of litigation does not equate to "the real and imminent threat of litigation." Lester, 2015 WL 3528336, at *6.
This showing is not sufficient to establish that the documents on Privilege Log #538-3 are protected by the work product doctrine, because there is no evidence of any real or imminent threat of litigation which led to their creation. Resurrection Healthcare v. GE Health Care, No. 07 C 5980, 2009 WL 691286, at *2 (N.D. Ill. Mar. 16, 2009) (holding that party's failure to show that documents were created in response to threat of litigation resulted in finding that they were not protected work product). Accordingly, because the documents on Privilege Log #538-3 do not constitute work product and are not subject to the attorney-client privilege, they are not protected by the "joint defense privilege" and must be produced.
The documents listed on Privilege Log #538-4 are emails dated between April 1, 2011, and December 2, 2011, and were therefore sent very shortly before or while this lawsuit was underway. Fifteen of the eighteen emails listed were sent between Hutchens and Gaché. The remaining three were sent by Hutchens to Gaché and others. In order to understand who the others are, the Court ordered the Broad Defendants to submit a roster of relevant individuals explaining their involvement in the events underlying the case (the "Roster"). See [#592]. The other individuals to whom the emails on Privilege Log #538-4 were sent include Michael Spiro, Michael Blinick, Louis Strezos, and Scott Hutchinson, none of whom are identified on the Roster [#598]. In addition, neither their identities nor any conclusive explanation of their involvement is determinable from the content of the emails themselves.
The attorney-client privilege does not apply to any of the emails on Privilege Log #538-4. Gaché and Hutchens were not in an attorney-client relationship when the emails were sent, and the lack of an explanation of the identities of Spiro, Blinick, Strezos, and Hutchinson compels the Court to conclude that any attorney-client privilege which might be applicable to those three emails has been waived.
However, the work product doctrine protects these emails, which address the broker's internet allegations against the Broad Defendants and the common interest of Hutchens and Gaché in defending against those allegations, as well as the Oxley Companies' lawsuits then pending against all. [#561-1] at 2; EEOC v. Outback Steakhouse of Fl., Inc., 251 F.R.D. 603, 610 (D. Colo. 2008). Plaintiffs have made no showing of substantial need or undue burden to overcome work product protection, as required by Fed. R. Civ. P. 26(b)(3)(A)(ii).
Finally, the requirements for assertion of the joint defense privilege are also met here. (1) The documents are protected by the work product doctrine; (2) there was existing litigation at the time; and (3) the documents were exchanged between parties for the purpose of mounting a common defense against the litigation. Metro Wastewater Reclamation Dist., 142 F.R.D. at 478-479. Accordingly, the documents on Privilege Log #538-4 are protected from disclosure and need not be produced.
The Broad Defendants assert that the documents listed on Privilege Log #538-5 are protected by the work product doctrine and, as to a few,
For the reasons explained in Section D above, this showing is insufficient to establish that the documents are protected by the work product doctrine. See Lester, 2015 WL 3528336, at *6. Even if the documents were protected by the work product doctrine or the attorney-client privilege, because the Broad Defendants have failed to establish that there was "a strong possibility of future litigation" at the time when these documents were created, the "joint defense privilege" is not applicable. See Metro Wastewater Reclamation Dist., 142 F.R.D. at 478-479. Hence, the documents listed on Privilege Log #538-5 must be produced.
For the reasons set forth above,
IT IS HEREBY
Declaration of Ronald Gaché Pursuant to Minute Order (#557) [#561-1] at 1. The documents listed on Privilege Log #538-3 reflect communications between Mr. Gaché and a host of others (e.g., Alvin Meisels, an attorney for Hutchens, and Tom Warren, a private investigator employed by Hutchens). Because the communications appear to involve parties with separate lawyers who consulted together under the guise of common interest, the "common interest rule privilege" is the applicable privilege here.
