United States District Court, D. Connecticut
RICHARD M. COAN, TRUSTEE, et al.
v.
SEAN DUNNE, et al.
RULING ON THE TRUSTEE'S MOTION TO OVERRULE
DEFENDANTS' PRIVILEGE OBJECTIONS AND COMPEL PRODUCTION OF
WITHHELD DOCUMENTS (DOC. 181)
ROBERT
M. SPECTOR UNITED STATES MAGISTRATE JUDGE.
I.
RELEVANT PROCEDURAL HISTORY
On
December 18, 2018, this Court filed a 34-page Ruling on the
Trustee's Motion to Compel [“December
18th Ruling”], in which, inter alia, the
Court discussed the parties dispute over documents withheld
by the defendants[1] as privileged. (Doc. No. 129 at 31-32). As
stated in the December 18th Ruling:
The Court [(Meyer, J.)] addressed the parties' privilege
logs during the November 16, 2018 hearing, during which the
Court inquired whether there was a separate motion addressing
this issue and then informed the parties: “I think it
really needs to be its own motion if it's going to be
something the Court acts on. We had a motions deadline to do
that.” (Doc. No. 99 at 78-79). The Court then stated
that “this is something to raise with respect to the
same other motion[]” that was referred to this
Magistrate Judge. (Doc. No. 99 at 80). The Court directed the
parties to “look at [the] specific privilege
items” and then confer with each other and “try
to resolve it.” (Doc. No. 99 at 80). The defendants
contend that the Trustee “did not attempt to identify
any specific items to [the defendants] in an effort to
resolve any disputes concerning them.” (Doc. No. 120 at
23).
(Doc. No. 129 at 32). The parties then embarked in
supplemental briefing relating to their then-pending Motion
to Compel (see Doc. No. 64), which included argument on the
privilege issue and the Trustee's challenge to 6, 756
communications logged in Killilea's May 4, 2018 privilege
log. The defendants argued that the issue was not within the
scope of the then-pending Motion to Compel and that the
Trustee did not follow the Court's (Meyer, J.) directive
to “identify . . . specific items” in which the
privilege was disputed. (Doc. No. 120 at 23-24). The Trustee
argued that the attorney-client privilege was waived as to
broad categories of communications, including those that
identified James Ryan who the Trustee knew to be a member of
the defendants' litigation team both in Ireland and the
United States. In the December 18th Ruling, this
Court ruled that the defendants had to produce
“documents from James Ryan which are not protected by
the attorney-client or work-product privilege[, ]” and
that the parties “shall confer about the privilege
designations.” (Doc. No. 129 at 25). The Court also
directed the parties to “once again . . . confer and
try to resolve the outstanding privilege issues.” (Doc.
No. 129 at 32).
On
January 17, 2019, the Trustee filed the pending Motion to
Overrule Defendants' Privilege Objections and to Compel
Production of Withheld Documents (Doc. No. 181; see also Doc.
No. 254). The next day, this motion was referred to this
Magistrate Judge. (Doc. No. 184). In this pending motion, the
Trustee seeks to “compel the [d]efendants to produce
all communications with nonlawyers, accountants, architects,
engineers and real estate agents, communications with Sean
Dunne (“the Debtor”) and communications with
adverse attorneys.” (Doc. No. 181 at 2-3). Included
within his request, the Trustee seeks “all
communications listed in both the [d]efendants' privilege
log and the D'Agostino, Levine, Landesman & Lederman,
LLP (“D'Agostino”) [log], which was prepared
by [d]efendants but not produced until December 11, 2018[,
]” as well as “all responsive emails involving
Ross Connolly and James Ryan, who are accountants hired by
the Debtor and/or Killilea.” (Doc. No. 181 at 3). The
Trustee claims that, “[a]lthough the parties met and
conferred on December 21, 2018, the [d]efendants still refuse
to withdraw even a single privilege assertion[.]” (Doc.
No. 181 at 2). Additionally, the Trustee claims that the
defendants have “had nearly a year to establish exactly
why Connolly and Ryan were necessary for the delivery of
legal advice and have not even attempted to do so.”
(Doc. No. 181 at 9).[2] The Trustee also recounts the fact that,
despite the Bankruptcy Court's order on August 17, 2018,
directing the parties to “deliver to the Court all
unredacted documents referred to in the Privilege Log for an
in camera review, ” the defendants “never
produced a single document for an in camera review to any
Court at any time[, ]” nor did the defendants undertake
a review to review any “incorrect” privilege
designations as they represented they would to the Bankruptcy
Court. (Doc. No. 181, at 2, 6-7).
II.
DISCUSSION
A.
Defendants' Privilege Logs - Schedules 4, 4-A and 4-B
As this
Court discussed in the December 18th Ruling (at
24-25), the defendants bear the burden of proving the
applicability of the attorney-client privilege:
A party invoking the attorney-client privilege bears the
burden to establish the elements of the privilege: “(1)
communication between client and counsel that (2) was
intended to be and was in fact kept confidential, and (3) was
made for the purpose of obtaining or providing legal
advice.”
In re Smith, No. 14-21261 (JTT), 2017 WL 1190590, at
*5 (Bankr. D. Conn. Mar. 29, 2017) (quoting In re Cty. of
Erie, 473 F.3d 413, 419 (2d Cir. 2007)). “The rule in
this Circuit, . . . is that the applicability of the
attorney-client privilege to a particular communication
depends on ‘whether the predominant purpose of the
communication is to render to solicit legal
advice.'” Deutsche Bank Nat. Trust Co. v. WMC
Mortg., LLC, Nos. 3:12 CV 933(CSH), 3:12 CV 969, 3:12 CV
1347(CSH), 2015 WL 1650835, at *5 (D. Conn. Apr. 14, 2015)
(quoting Erie, 473 F.3d at 420) (footnote omitted)).
The
privilege logs filed under seal with the Trustee's Motion
total 430 pages (see Doc. No. 182; see Doc.
Nos. 183, 185) and, as the Trustee explains, reflect that the
attorney-client privilege was asserted 7, 481 times for
communications with non-lawyers, including 6, 756 times for
communications with James Ryan and 67 times for
communications with Ross Connolly, and at least 436 times
with various non-lawyers who the Trustee has identified as
engineers, real estate agents, architect and
accountants.[3] (Doc. No. 181 at 10; Doc. No. 182; see
also Doc. No. 254 at 8). Additionally, the Trustee
points to assertions of the privilege on communications
involving lawyers who are directly adversarial, as well as
other non-lawyers, and note that Killilea “failed to
identify the roles of people identified in the log, [so that
the] Trustee has only listed . . .communications with the
people that the Trustee knows are either nonlawyers or
adverse lawyers who destroy any colorable claim of
privilege.” (Doc. No. 181 at 11).
As this
Court recently explained in its Ruling on the Plaintiff's
Renewed Motion for Further Contempt (Doc. No. 225 at 22-23),
filed on February 11, 2019, privilege logs must include
“sufficient substantive detail for a meaningful review
of the application of the privilege[, ]” including
whether the communications were confidential and made between
an attorney and client for the purpose of providing legal
advice. Bolorin v. Borrino, 248 F.R.D. 93, 95 (D.
Conn. 2008).[4]Although the defendants argue that the
Trustee has not identified “any individual specific
communications in an effort to resolve any disputes
concerning them[]” (Doc. No. 217 at 16), the record is
clear that the Trustee has identified, at minimum, 7, 481
communications, as referenced above, which includes over 600
documents with lawyers who are directly adversarial and with
non-lawyer third parties (exclusive of the documents
involving Connolly and Ross).
Rule
26(b)(5) of the Federal Rules of Civil Procedure provides
that, when a party withholds discoverable information by
claiming it is privileged or protected, “the party
must: (i) expressly make the claim; and (ii) describe the
nature of the documents, communications, or tangible things
not produced or disclosed-and do so in a manner that, without
revealing information itself privileged or protected, will
enable other parties to assess the claim.”
Id.; see also D. Conn. L. Civ. R. 26(e)
(“[i]n accordance with Fed.R.Civ.P. 26(b), . . . when a
claim of privilege or work product protection is asserted in
response to a discovery request for documents, ” the
party asserting the privilege “shall serve on all
parties a privilege log containing the following
information”: (1) “[t]he type of document”,
(2) “[t]he general subject matter of the
document”, (3) “[t]he date of the
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