Railroad Salvage of Conn., Inc. v. Japan Freight Consolidators (U.S.A.) Inc.

97 F.R.D. 37, 36 Fed. R. Serv. 2d 716, 12 Fed. R. Serv. 1999, 1983 U.S. Dist. LEXIS 19048
District Court, E.D. New York·Decided February 23, 1983·No. No. 80 CIV 3089·Published·Cited by 19 cases

Opinion

MEMORANDUM AND ORDER

McLAUGHLIN, District Judge.

This is a diversity action for conversion, negligence, and breach of contract. Several discovery motions are pending before the Court.

Plaintiff’s Motion To Compel Production Of Defendant’s Communications With Its Insurers

On December 31,1980, plaintiff, Railroad Salvage of Conn., Inc. (“Railroad Salvage”), served defendant, Japan Freight Consolidators (U.S.A.) (“JFC”), with a request pursuant to Fed.R.Civ.P. 34 for production and inspection of documents. Paragraph 12 of that request demands (a) production of “[a]ll insurance policies which may in any manner relate to coverage of Japan Freight for the transaction described in this action, or any part thereof, and (b) all documents relating to claims under said policies.”

JFC has complied with paragraph 12(a) but refuses to produce the documents specified in paragraph 12(b). JFC argues that because the latter documents consist solely of correspondence between JFC’s former counsel1 in this matter and JFC’s insurers, the documents are protected by the limited immunity from discovery which is afforded to “trial preparation materials” under Fed.R.Civ.P. 26(b)(3). I have inspected the documents in question, and I agree with JFC. Accordingly, the motion to compel is denied.

DISCUSSION

The threshold issue in evaluating JFC’s claim of work product immunity is whether to apply Fed.R.Civ.P. 26 or N.Y. CPLR 3101. It is clear that in a diversity case, Fed.R.Evid. 501 requires the application of state law to questions of privilege. Dixon v. 80 Pine Street Corp., 516 F.2d 1278, 1280 (2d Cir.1975) (governmental privilege); Republic Gear Co. v. Borg-Warner Corp., 381 F.2d 551, 555-56 n. 2 (2d Cir. 1967) (attorney-client privilege); Massachusetts Mutual Life Insurance Co. v. Brei, 311 F.2d 463, 466 (2d Cir.1962) (physician-patient privilege).

In Brei, the court held that Erie Railroad Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938), required the application of the New York rule on physician-patient privilege in a diversity action because the privilege is substantive rather than procedural. The court explained that “[t]he rule of privilege is unlike the ordinary rules of practice which refer to the process of litigation, in that it affects private conduct before litigation arises.” Id. 311 F.2d at 466. It is unclear, however, whether work product immunity is the type of “privilege” which mandates application of state law pursuant to Rule 501. See Fine v. Bellefonte Underwriters Insurance Co., 91 F.R.D. 420, 422 (S.D.N.Y.1981).

In Merrin Jewelry Co. v. St. Paul Fire And Marine Insurance Co., 49 F.R.D. 54 (S.D.N.Y.1970) defendant invoked CPLR 3101(d) (“material prepared for litigation”) to oppose plaintiff’s requests for production of documents prepared for defendant by its accountants. Quoting Massachusetts Mutu[40] al Life Insurance Co. v. Brei, supra, at 465-66, defendant argued “that state law ‘governs the issue of privilege in diversity cases.’ ’’ Merrin Jewelry, supra, at 56. Judge Frankel, however, rejected the argument stating:

The defect in the argument is that we do not have here an “issue of privilege” in any pertinent sense. To begin with, CPLR § 3101, defining the scope of discovery in state courts, itself distinguishes the protection from discovery of “ [privileged matter,” dealt with in subsection (b), from the separate category, subsection (d), of “[mjaterial prepared for litigation.” Thus, in the State’s own terms, the matter is one governing procedure in the state courts, a direct counterpart of the federal rules governing us. And while that state classification may not be decisive in itself, it seems clear as a matter of federal law that New York’s regulation of its own discovery practice in subsection (d) of CPLR § 3101 adds nothing to the scope of “privileged” matter protected against production under our Rule 34.

Id.

Thus, in a diversity case, Fed.R.Evid. 501 would not require the application of CPLR 3101(d). Instead, a court would analyze the claim of immunity under Fed.R. Civ.P. 26(b)(3).

Our case, however, presents a different issue. In Merrin Jewelry, supra, the material sought had been prepared by defendant’s accountants; here, the material was prepared by defendant’s attorney. The distinction is significant because CPLR 3101(c) accords “attorney work product” an absolute immunity from discovery unlike 3101(d)’s qualified immunity. Although Rule 501 does not require application of CPLR 3101(d)’s qualified immunity in diversity cases, see Merrin Jewelry, supra, the issue here is whether Rule 501 requires application of CPLR 3101(c)’s absolute immunity for attorney work product in diversity cases.

Rule 501 provides that in a diversity case “the privilege of a witness ... shall be determined in accordance with State law.” Fed.R.Evid. 501. The question, therefore, is whether work product (CPLR 3101(c)) is a privilege within the meaning of Rule 501.

The structure of CPLR 3101 is enlightening. Subdivision (a) provides for liberal disclosure. Subdivision (b) exempts “privileged matter” from disclosure in all cases. Subdivision (c) likewise exempts “the work product of an attorney” in all cases. Finally, subdivision (d) creates a conditional privilege for “material prepared for litigation.” It is immediately evident that the CPLR itself distinguishes between a true eviden-tiary privilege (subdivision (b)) and attorney work product (subdivision (c)). If the latter were a privilege, there would obviously be no need for subdivision (c).

Properly analyzed, it seems clear CPLR 3101(b) refers to the traditional evidentiary privileges (attorney-client, doctor-patient, etc.), while subdivisions (c) and (d) deal with matter as to which there is no evidentiary privilege, but which is nevertheless immune from pretrial discovery. See Annot., 35 A.L.R.3d 412 (1971).

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Railroad Salvage of Conn., Inc. v. Japan Freight Consolidators (U.S.A.) Inc., 97 F.R.D. 37, 36 Fed. R. Serv. 2d 716, 12 Fed. R. Serv. 1999, 1983 U.S. Dist. LEXIS 19048 (E.D.N.Y. 1983).

97 F.R.D. 37 (Railroad Salvage of Conn., Inc. v. Japan Freight Consolidators (U.S.A.) Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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