Hanover Insurance v. Plaquemines Parish Government
Hanover Insurance v. Plaquemines Parish Government
Opinion of the Court
ORDER AND REASONS
Before the Court is a Motion for Appeal of Magistrate Judge Decision (Doc. 355). For the following reasons, the Motion is DENIED.
BACKGROUND
In 2008, Defendant Plaquemines Parish (“the Parish”) hired Cateo General Contractors to construct a community center in Boothville, LA. Plaintiff Hanover Insurance Company issued a performance bond for the project. Due to several disputes regarding the quality of the completed work, the Parish refused to tender the final payment on the construction contract to Cateo. Cateo in turn refused to pay certain subcontractors on the project. Those subcontractors filed claims with Hanover seeking amounts due on the subcontracts. Hanover then instituted the instant litigation claiming that the Parish wrongfully withheld the final payment from Cateo, resulting in several hundred thousand dollars in various claims against Hanover.
On May 29, 2013, in response to Hanover’s Complaint, the Parish asserted a coun
These initial filings spawned an avalanche of litigation. There are now more than 90 pleadings and over 30 parties in this matter. Because of the complex nature of this ease, deposition discovery has proceeded in phases. The first phase of depositions consisted of 22 individuals identified as “principal/key witnesses.” During the course of these depositions, a dispute arose regarding several witnesses who are former employees of Cat-eo and Seizer, Thompson, Brown, the principal architects on the project.
The dispute began during the deposition of Stuart Maginnis. Mr. Maginnis was the vice president of Cateo at the time of the con-stx’uetion project at issue. In 2010, Mr. Mag-innis left Cateo and started his own construction company. Prior to his deposition in this ease, Mr. Maginnis met with counsel for Cat-eo and Hanover to prepare for the deposition. At the deposition, Mr. Maginnis was asked to describe his conversations with counsel and to identify the documents showed to him by counsel in preparation for the deposition. Counsel for Cateo and Hanover instructed him not to answer the questions, asserting attorney-client pi’ivilege. An identical dispute emei’ged during the deposition of Joseph Cavallo. Mr. Cavallo was employed by Seizer, Thompson, Brown as a construction administrator. At the time of the deposition, he was no longer employed by Seizer, Thompson, Brown. Like Mr. Magin-nis, Mr. Cavallo met with counsel for his former employer prior to the deposition. When he was asked to describe his conversations with Seizei’, Thompson, Bx’own’s counsel he was instructed not to answer on the basis of attorney-client privilege. The Parish and Mayeux’s A/C and Heating, Inc., one of Cateo’s subcontractors, filed motions to compel answers to the questions. The Magistrate Judge held that the conversations are privileged and denied the motions. The Parish appealed.
LEGAL STANDARD
With the consent of the presiding district judge, a magistrate judge may adjudicate non-dispositive pre-trial motions.
LAW AND ANALYSIS
The question presented by this Motion is simple, even if the answer is not: are conversations between counsel for a corporation and the corporation's former employees entitled to the attorney-client privilege, and, if so, to what extent? Federal Rule of Evidence 501 provides that “in a civil case, state law governs privilege regarding a claim or defense for which state law supplies the rule of decision.” The parties agree, and the Court is convinced, that Louisiana law governs the resolution of this issue.
This Court is bound under Eñe to apply the same law as would be applied by the Louisiana Supreme Court.
Neither the Court nor the parties have been able to locate a reasoned decision issued by a Louisiana court addressing this issue. The only Louisiana appellate court to address this issue did so in a summary order. In Turner v. Lowery, the Louisiana Supreme Court issued an order that reads:
[Writ] Granted. Judgment of the trial court is vacated and set aside. Relators’ motion for protective order is granted, and a protective order is entered in their favor preventing any discovery regarding privileged communications between relators’ corporate counsel and any former employees relating to the subject matter of this lawsuit. See Upjohn Co. v. United States, 449 U.S. 383, 402-03,101 S.Ct. 677, 688-89, 66 L.Ed.2d 584 [ (1981) ] (Burger, C.J. concurring); In re Allen, 106 F.3d 582, 605-06 (4th Cir. 1997).11
While the Louisiana Supreme Court’s order in Turner is not binding precedent, it is persuasive authority and strongly influences this Court’s Erie guess. Yet, in the absence of further explanation from the Turner Court, the precise parameters of the decision are ambiguous. An examination of the cases cited in Turner, as well as the other federal cases on point, provides some guidance.
The seminal case on the existence of the privilege between corporate counsel and the employees of a corporation is the Supreme Court’s decision in Upjohn Company v. United States.
The Supreme Court held that the communications between Mr. Thomas and the Upjohn employees were privileged.
The Court also noted that several of the subpoenaed communications occurred with individuals who were no longer employed by Upjohn.
[I]n my view the Court should make clear now that, as a general rule, a communication is privileged at least when, as here, an employee or former employee speaks at the direction of the management with an attorney regarding conduct or proposed conduct within the scope of employment. The attorney must be one authorized by the management to inquire into the subject and must be seeking information to assist counsel in performing any of the following functions: (a) evaluating whether the employee’s conduct has bound or would bind the corporation; (b) assessing the legal consequences, if any, of that conduct; or (c) formulating appropriate legal responses to actions that have been or may be taken by others with regard to that conduct.31
Since Upjohn was decided, a relatively small number of federal courts have considered whether to extend Upjohn to former employees. Indeed, only two circuit courts have addressed the issue. Both the Ninth and the Fourth Circuits adopted the Burger concurrence.
In order to determine the extent of the privilege, this Court need not look beyond the second case cited by Turner—In re Allen.
In light of Turner’s reliance on In re Allen and the Burger concurrence, this Court concludes that the Louisiana Supreme Court would recognize the existence of a privilege between counsel for a corporation and a former employee of the corporation, at
In light of this conclusion, the Court cannot say that the Magistrate Judge was clearly erroneous in holding that the conversations at issue are privileged. Both Mr. Maginnis and Mr. Cavallo were employed with their respective former employers during the construction of the community center. Not only did they both have knowledge of the construction project, but they were among the most important individuals associated with the project. Finally, it is also clear that they both spoke with the corporate attorneys in order to enable the attorneys to defend against this litigation. Therefore, the Court concludes that the Magistrate Judge correctly found that the communications were privileged.
There is one additional matter before the Court. The Parish contends that, even if the pre-deposition conversations between Mr. Maginnis, Mr. Cavallo, and counsel for their respective former employers are privileged, the Parish is nonetheless entitled to know what documents the witnesses reviewed in preparation for their depositions pursuant to Federal Rule of Evidence 612. Cateo and Seizler, Thompson, Brown contend that the documents are protected from disclosui'e by the work-product privilege.
Rule 612 affords a party certain options when an adverse witness uses a writing to refresh his memory. It is important, however, to note that the rule does not apply uniformly without regard to when the witness’s memory is refreshed. Rather, when a witness uses a writing to refresh his memory prior to testifying, the adverse party may only avail itself of Rule 612 “if the court decides that justice [so] requires.”
Here, the witnesses were shown the documents prior to testifying. Therefore, the Parish must convince this Court that justice requires the documents be produced to the Parish. The Parish has not met this burden. The Parish’s primary justification for requesting the documents is based on a theory that some witnesses may have learned facts for the first time just prior to their deposition. Essentially, the Parish argues that it is important to know when a witness learned certain facts about which he testifies. However, the Court is not convinced that the Parish needs the entire list of documents shown to the witness prior to the deposition in order to answer that question. Rather, the Parish is free to ask a witness when he first learned about certain facts.
Additionally, the Court is convinced that the identity of any documents shown to the witness by counsel is, under the peculiar facts of this case, protected by the work-product privilege. According to counsel for the parties, over 20,000 documents have been produced in written discovery. Where, as here, an attorney culls through a large volume of documents and identifies those that she believes are important to the litigation, that selection of documents necessarily reveals the attorney’s opinions regarding the litigation.
For the foregoing reasons, the Motion to Appeal is DENIED.
. 28 U.S.C. § 636(b)(1)(A) (West 2014).
. McCallon v. BP Am. Prod. Co., Nos. 05-0597, C/W 05-0700, 2006 WL 3246886, at *2 (E.D.La. Nov. 8, 2006).
. Fed.R.Civ.P. 72(a).
. 28 U.S.C. § 636(b)(1)(A); Fed.R.Civ.P. 72(a).
. Yelton v. PHI, Inc., 284 F.R.D. 374, 376 (E.D.La. 2012).
. Howe ex rel. Howe v. Scottsdale Ins. Co., 204 F.3d 624, 627 (5th Cir. 2000) (citing Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938)).
. Id. at 627.
. Chaney v. Dreyfus Serv. Corp., 595 F.3d 219, 229 (5th Cir. 2010).
. Id.
. See State v. Foret, 628 So.2d 1116, 1122 (La. 1993) (citing La.Code Evid. art. 102 cmt. a. ("[T]he adoption of this Code facilitates the movement towards a uniform national law of evidence____ Louisiana courts now have available a body of persuasive authority which may be instructive in interpreting the Louisiana Code.”)).
. 703 So.2d 1 (La. 1997).
. 449 U.S. 383, 101 S.Ct. 677, 66 L.Ed.2d 584 (1981).
. Id. at 386, 101 S.Ct. 677.
. Id.
. Id.
. Id. at 386-87, 101 S.Ct. 677.
. Id.
. Id. at 387, 101 S.Ct. 677.
. Id.
. Id.
. Id.
. Id. at 387-88, 101 S.Ct. 677.
. Id. at 388, 101 S.Ct. 677
. Id.
. Id. at 395, 101 S.Ct. 677.
. Id. at 390, 101 S.Ct. 677.
. Id. at 392, 101 S.Ct. 677. Prior to Upjohn, several circuit courts had limited the privilege to communications between the controlling officers of the corporation and corporate counsel.
. Id. at 394 n. 3, 101 S.Ct. 677.
. Id.
. Id. at 402, 101 S.Ct. 677.
. Id. at 402-03, 101 S.Ct. 677.
. In re Coordinated Pretrial Proceedings in Petroleum Products Antitrust Litig., 658 F.2d 1355, 1361 n. 7 (9th Cir. 1981); In re Allen, 106 F.3d 582, 606 (4th Cir. 1997). The Parish contends that In re Petroleum Products only discusses the Burger concurrence in a footnote and that the discussion is dicta. However, assuming arguendo, that the adoption of the Burger concurrence in In re Petroleum Products was dicta, several subsequent Ninth Circuit decisions have applied it as the law of the circuit. See, e.g., Admiral Ins. Co. v. U.S. Dist. Court for Dist. of Arizona, 881 F.2d 1486, 1493 (9th Cir. 1989); United States v. Chen, 99 F.3d 1495, 1502 (9th Cir. 1996). Thus, there can be no doubt that the Ninth Circuit has adopted the rationale of the Burger concurrence.
. See Peralta v. Cendant Corp., 190 F.R.D. 38 (D.Conn. 1999) (holding that the privilege applied to former employees); Infosystems, Inc. v. Ceridian Corp., 197 F.R.D. 303 (E.D.Mich. 2000) (same); Surles v. Air France, No. 00-5004, 2001 WL 815522 (S.D.N.Y. July 19, 2001) (same); Wade Williams Distribution, Inc. v. Am. Broad. Companies, Inc., No. 00-5002, 2004 WL 1487702 (S.D.N.Y. June 30, 2004) (same); Exp.-Imp. Bank of the U.S. v. Asia Pulp & Paper Co., 232 F.R.D.
. 106 F.3d 582.
. Id. at 587.
. Id.
. Id. at 588.
. Id.
. Id. 588-89.
. Id. at 589.
. Id.
. Id. at 590.
. Id.
. Id.
. Id.
. Id. at 603.
. Id. at 605.
. Id. at 606.
. Id.
. Upjohn, 449 U.S. at 403, 101 S.Ct. 677 (Burger, C.J., concurring).
. Fed.R.Evid. 612(a)(2). See also Burns v. Exxon Corp., 158 F.3d 336, 343 (5th Cir. 1998).
. In re Allen, 106 F.3d at 608.
. See In re Int’l Sys. & Controls Corp. Sec. Litig., 693 F.2d 1235, 1240 (5th Cir. 1982). Of course, nothing in this order would prevent counsel from asking a deponent when they first saw a given document, or whether a document was reviewed by the deponent prior to the deposition.
Reference
- Full Case Name
- HANOVER INSURANCE COMPANY v. PLAQUEMINES PARISH GOVERNMENT
- Cited By
- 7 cases
- Status
- Published