1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA
9 Liberty Corporate Capital Limited, No. CV-19-05698-PHX-GMS
10 Plaintiff/Counterdefendant, ORDER
11 v.
12 Jill Marie Steigleman,
13 Defendant/Counterclaimant. 14 15 16 Pending before the Court is Liberty Corporate Capital Limited’s (“Plaintiff”) 17 Motion for Reconsideration of Discovery Order (Doc. 91). The Court determines that 18 telephonic oral argument will aid its consideration of Plaintiff’s Motion. In anticipation of 19 oral argument, Plaintiff is ordered to transmit the items listed in its privilege log 20 (Doc. 52-11) to the Court for in-camera review. 21 BACKGROUND 22 In her original Motion to Compel, Jill Marie Steigleman (“Defendant”) sought 23 communications between Liberty and its affiliated entities; its attorneys at Fields Howell 24 LLP; and employees of Hanleigh Management, Inc., and Guy Carpenter & Company who 25 were purportedly involved in the denial of her coverage on January 22, 2019. (Doc. 47 at 26 2.) Plaintiff asserts that these communications are subject to the attorney-client privilege 27 and has produced a privilege log detailing its objections. (Doc. 52); (Doc. 52-11.) On 28 January 21, 2022, the Court ruled that Plaintiff had waived the attorney-client privilege as 1 to “all pre-existing communications between Plaintiff and [its attorney] pertaining to the 2 decision to deny Defendant’s claim” because it intentionally disclosed its attorney’s legal 3 opinion to Defendant. (Doc. 85.) Plaintiff then filed a Motion to Stay (Doc. 90) and a 4 Motion for Reconsideration (Doc. 91). 5 DISCUSSION 6 I. Legal Standard 7 “A district court may conduct an in camera inspection of alleged confidential 8 communications to determine whether the attorney-client privilege applies.” Clarke v. Am. 9 Com. Nat. Bank, 974 F.2d 127, 129 (9th Cir. 1992). The party asserting the privilege bears 10 the burden of establishing that the privilege applies to the documents in question. United 11 States v. Lacey, No. CR-18-422-PHX-SPL, 2019 WL 258344, at *2 (D. Ariz. Jan. 17, 12 2019). The “proper procedure for asserting the attorney-client privilege as to particular 13 documents” is for the party asserting the privilege to “submit them in camera for the court’s 14 inspection, providing an explanation of how the information fits within the privilege.” In 15 re Grand Jury Witness (Salas), 695 F.2d 359, 362 (9th Cir. 1982). 16 In camera review is proper when the party contesting the application of privilege 17 shows a “factual basis sufficient to support a reasonable, good faith belief that in camera 18 inspection may reveal evidence that information in the materials is not privileged.” In re 19 Grand Jury Investigation, 974 F.2d 1068, 1075 (9th Cir. 1992). “If the party makes such 20 a showing, the decision whether to conduct the review rests within the discretion of the 21 district court,” “guided by the factors enumerated in” United States v. Zolin, 491 U.S. 554 22 (1989). Id. The Zolin factors require the Court to consider 23 the facts and circumstances of the particular case, including, among other things, the volume of materials the district court 24 has been asked to review, the relative importance to the case of the alleged privileged information, and the likelihood that the 25 evidence produced through in camera review, together with other available evidence then before the court, will establish 26 that the [attorney-client privilege] does apply. 27 See Zolin, 491 U.S. at 572. 28 // 1 II. Analysis 2 Defendant has provided a factual basis to support a reasonable, good faith belief that 3 in camera review “may reveal evidence that information in the materials is not privileged,” 4 namely that instead of providing legal advice, Fields Howell was involved in determining 5 Defendant’s claim. In re Grand Jury, 974 F.2d at 1075. Plaintiff retained Fields Howell 6 on October 22, 2018.1 (Doc. 52-11 at 12.) On November 1, 2018, Mr. Graham Southall, 7 Hanleigh’s Chief Underwriting Officer, informed Defendant that “Underwriters have 8 asked that your claim be reviewed by” Fields Howell, and that “[w]e will revert as soon as 9 we receive a determination.” (Doc. 47-4 at 5.) After October 22, Plaintiff’s privilege log 10 reflects that Mr. Greg Mast, from Fields Howell, was involved in several lengthy email 11 chains about Defendant’s claim, which culminated in him drafting a letter dated January 12 22, 2019, denying Defendant’s claim on behalf of Plaintiff. (Doc. 52-11.) 13 In a deposition, Plaintiff’s 30(b)(6) witness, Ms. Julie Tripp, asserted that Mr. 14 Matthew Phillips, a claims adjuster employed by Plaintiff, had determined Defendant’s 15 claim, and that he did so without seeking legal advice. (Doc. 91-1 at 4, 9.) Ms. Tripp 16 further testified that she believed Mr. Phillips made this determination sometime before 17 November 1, 2018, (Doc. 91-1 at 10), and that she learned Mr. Phillips made the 18 determination from counsel. (Doc. 95-6 at 4.) Plaintiff has not indicated a precise date on 19 which Mr. Phillips is alleged to have made this determination, nor has Plaintiff provided 20 the Court with any contemporaneous documentation of this determination. As a result, the 21 Court cannot conclude with any certainty that a coverage determination had in fact been 22 made before November 1, 2018. In camera review will reveal whether such a 23 determination had in fact been made prior to the retention of Fields Howell, which will aid 24 the Court in concluding whether the attorney-client privilege has been impliedly waived.2
25 1 In its briefing, Plaintiff claims that Fields Howell was retained on October 22, 2019. (Doc. 52 at 2.) But Plaintiff’s privilege log indicates that Fields Howell was retained on 26 October 22, 2018, and includes detailed correspondence between Fields Howell and other individuals in late 2018. (Doc. 52-11 at 12.) 27 2 Even if the documents bear out Plaintiff’s assertion that Mr. Mast was not involved in the 28 determination of the claim and that Liberty or its underwriters instructed Mr. Mast as to the appropriate content of the letter denying the claim, it is not clear that any such 1 Turning to the Zolin factors, the Court concludes that in camera review is 2 appropriate at this time. See Zolin, 491 U.S. at 572. First, the volume of materials would 3 be, at most, 540 pages. (Doc. 52-11 at 14.) However, much of this material appears to 4 have been generated after January 22, 2019, when the coverage determination was 5 communicated to Defendant. While the Court will review all documents in the log, the 6 Court anticipates dedicating the bulk of its attention to a fraction of the total documents 7 produced. Therefore, this factor weighs in favor of in camera review. Second, Defendant 8 claims that the communications at issue pertain to Plaintiff’s decision to deny her coverage 9 under her policy. Because Defendant argues Plaintiff reached this decision in bad faith, 10 (Doc. 25 at 27–28), the content of the communications would be of utmost importance to 11 her case if they were not privileged. This second factor also weighs in favor of in camera 12 review.
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1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA
9 Liberty Corporate Capital Limited, No. CV-19-05698-PHX-GMS
10 Plaintiff/Counterdefendant, ORDER
11 v.
12 Jill Marie Steigleman,
13 Defendant/Counterclaimant. 14 15 16 Pending before the Court is Liberty Corporate Capital Limited’s (“Plaintiff”) 17 Motion for Reconsideration of Discovery Order (Doc. 91). The Court determines that 18 telephonic oral argument will aid its consideration of Plaintiff’s Motion. In anticipation of 19 oral argument, Plaintiff is ordered to transmit the items listed in its privilege log 20 (Doc. 52-11) to the Court for in-camera review. 21 BACKGROUND 22 In her original Motion to Compel, Jill Marie Steigleman (“Defendant”) sought 23 communications between Liberty and its affiliated entities; its attorneys at Fields Howell 24 LLP; and employees of Hanleigh Management, Inc., and Guy Carpenter & Company who 25 were purportedly involved in the denial of her coverage on January 22, 2019. (Doc. 47 at 26 2.) Plaintiff asserts that these communications are subject to the attorney-client privilege 27 and has produced a privilege log detailing its objections. (Doc. 52); (Doc. 52-11.) On 28 January 21, 2022, the Court ruled that Plaintiff had waived the attorney-client privilege as 1 to “all pre-existing communications between Plaintiff and [its attorney] pertaining to the 2 decision to deny Defendant’s claim” because it intentionally disclosed its attorney’s legal 3 opinion to Defendant. (Doc. 85.) Plaintiff then filed a Motion to Stay (Doc. 90) and a 4 Motion for Reconsideration (Doc. 91). 5 DISCUSSION 6 I. Legal Standard 7 “A district court may conduct an in camera inspection of alleged confidential 8 communications to determine whether the attorney-client privilege applies.” Clarke v. Am. 9 Com. Nat. Bank, 974 F.2d 127, 129 (9th Cir. 1992). The party asserting the privilege bears 10 the burden of establishing that the privilege applies to the documents in question. United 11 States v. Lacey, No. CR-18-422-PHX-SPL, 2019 WL 258344, at *2 (D. Ariz. Jan. 17, 12 2019). The “proper procedure for asserting the attorney-client privilege as to particular 13 documents” is for the party asserting the privilege to “submit them in camera for the court’s 14 inspection, providing an explanation of how the information fits within the privilege.” In 15 re Grand Jury Witness (Salas), 695 F.2d 359, 362 (9th Cir. 1982). 16 In camera review is proper when the party contesting the application of privilege 17 shows a “factual basis sufficient to support a reasonable, good faith belief that in camera 18 inspection may reveal evidence that information in the materials is not privileged.” In re 19 Grand Jury Investigation, 974 F.2d 1068, 1075 (9th Cir. 1992). “If the party makes such 20 a showing, the decision whether to conduct the review rests within the discretion of the 21 district court,” “guided by the factors enumerated in” United States v. Zolin, 491 U.S. 554 22 (1989). Id. The Zolin factors require the Court to consider 23 the facts and circumstances of the particular case, including, among other things, the volume of materials the district court 24 has been asked to review, the relative importance to the case of the alleged privileged information, and the likelihood that the 25 evidence produced through in camera review, together with other available evidence then before the court, will establish 26 that the [attorney-client privilege] does apply. 27 See Zolin, 491 U.S. at 572. 28 // 1 II. Analysis 2 Defendant has provided a factual basis to support a reasonable, good faith belief that 3 in camera review “may reveal evidence that information in the materials is not privileged,” 4 namely that instead of providing legal advice, Fields Howell was involved in determining 5 Defendant’s claim. In re Grand Jury, 974 F.2d at 1075. Plaintiff retained Fields Howell 6 on October 22, 2018.1 (Doc. 52-11 at 12.) On November 1, 2018, Mr. Graham Southall, 7 Hanleigh’s Chief Underwriting Officer, informed Defendant that “Underwriters have 8 asked that your claim be reviewed by” Fields Howell, and that “[w]e will revert as soon as 9 we receive a determination.” (Doc. 47-4 at 5.) After October 22, Plaintiff’s privilege log 10 reflects that Mr. Greg Mast, from Fields Howell, was involved in several lengthy email 11 chains about Defendant’s claim, which culminated in him drafting a letter dated January 12 22, 2019, denying Defendant’s claim on behalf of Plaintiff. (Doc. 52-11.) 13 In a deposition, Plaintiff’s 30(b)(6) witness, Ms. Julie Tripp, asserted that Mr. 14 Matthew Phillips, a claims adjuster employed by Plaintiff, had determined Defendant’s 15 claim, and that he did so without seeking legal advice. (Doc. 91-1 at 4, 9.) Ms. Tripp 16 further testified that she believed Mr. Phillips made this determination sometime before 17 November 1, 2018, (Doc. 91-1 at 10), and that she learned Mr. Phillips made the 18 determination from counsel. (Doc. 95-6 at 4.) Plaintiff has not indicated a precise date on 19 which Mr. Phillips is alleged to have made this determination, nor has Plaintiff provided 20 the Court with any contemporaneous documentation of this determination. As a result, the 21 Court cannot conclude with any certainty that a coverage determination had in fact been 22 made before November 1, 2018. In camera review will reveal whether such a 23 determination had in fact been made prior to the retention of Fields Howell, which will aid 24 the Court in concluding whether the attorney-client privilege has been impliedly waived.2
25 1 In its briefing, Plaintiff claims that Fields Howell was retained on October 22, 2019. (Doc. 52 at 2.) But Plaintiff’s privilege log indicates that Fields Howell was retained on 26 October 22, 2018, and includes detailed correspondence between Fields Howell and other individuals in late 2018. (Doc. 52-11 at 12.) 27 2 Even if the documents bear out Plaintiff’s assertion that Mr. Mast was not involved in the 28 determination of the claim and that Liberty or its underwriters instructed Mr. Mast as to the appropriate content of the letter denying the claim, it is not clear that any such 1 Turning to the Zolin factors, the Court concludes that in camera review is 2 appropriate at this time. See Zolin, 491 U.S. at 572. First, the volume of materials would 3 be, at most, 540 pages. (Doc. 52-11 at 14.) However, much of this material appears to 4 have been generated after January 22, 2019, when the coverage determination was 5 communicated to Defendant. While the Court will review all documents in the log, the 6 Court anticipates dedicating the bulk of its attention to a fraction of the total documents 7 produced. Therefore, this factor weighs in favor of in camera review. Second, Defendant 8 claims that the communications at issue pertain to Plaintiff’s decision to deny her coverage 9 under her policy. Because Defendant argues Plaintiff reached this decision in bad faith, 10 (Doc. 25 at 27–28), the content of the communications would be of utmost importance to 11 her case if they were not privileged. This second factor also weighs in favor of in camera 12 review. Finally, the communications that would be produced through in camera review, 13 combined with Plaintiff’s privilege log and other evidence before the Court, would allow 14 the Court to determine whether the attorney-client privilege would apply because the Court 15 will be able to determine whether Fields Howell provided legal advice in the 16 communications at issue. Therefore, all three Zolin factors weigh in favor of review. 17 CONCLUSION 18 IT IS HEREBY ORDERED that Plaintiff shall transmit all documents listed in its 19 privilege log (Doc. 52-11) to the Court for in camera review on or before February 18, 20 2022. 21 IT IS FURTHER ORDERED this matter is set for Telephonic Oral Argument on 22 February 25, 2022 at 11:00 a.m. Plaintiff’s counsel shall arrange a call-in number on or 23 before Noon on February 23, 2022 and disseminate the number to all parties, including 24 the Court. Both sides will be given fifteen minutes. 25 IT IS FURTHER ORDERED directing the parties to utilize landlines for this 26 telephonic oral argument to avoid challenges posed by the use of cell phones, headsets, or
27 communication by Liberty or its underwriters to Mr. Mast would be protected by the attorney-client privilege, because it may not have been a communication “for the purpose 28 of securing or giving legal advice.” Roehrs v. Minn. Life Ins. Co., 228 F.R.D. 642, 645 (D. Ariz. 2005). 1|| other devices. This will enable clear communication with the Court and accurate transcription by the Court Reporter. 3 Dated this 16th day of February, 2022. Wars ) 5 A Whacrsay Sooo) 6 Chief United States District Judge 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
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