United States District Court, D. Arizona
G. CAMPBELL UNITED STATES DISTRICT JUDGE.
discovery dispute involves the propriety of Director
Bergin’s assertion of the common interest privilege.
After a telephonic discovery conference, the Court ordered
Director Bergin to submit for in camera review Entry 102 on
his privilege log. After reviewing the document, the Court
requested additional briefing. The Court has reviewed the
briefing (Docs. 227, 228), and concludes that the common
interest privilege does not protect Entry 102 from
common interest privilege was first adopted in the criminal
defense context. In Continental Oil Co. v. United
States, 330 F.2d 347 (9th Cir. 1964), two defendants
were summoned to testify before a grand jury. They retained
separate attorneys, each of whom interviewed his or her
client, prepared a summary of the interview, and exchanged
the summary with the other defense lawyer. Id. at
348. The purpose of this exchange was to make
“representation of their clients in connection with the
Grand Jury investigation and any resulting litigation, more
effective.” Id. at 348-49. The government
subsequently sought to discover these summaries, and the
trial court held that they were not privileged. Id.
The Ninth Circuit reversed, finding that the attorney-client
privilege had not been waived when the summaries were shared.
The court recognized a “joint-defendant
exception” to the ordinary rule that privileges are
waived when privileged material is shared with third parties.
Id. at 350; see also Hunydee v. United
States, 355 F.2d 183, 185 (9th Cir. 1965)
(“[W]here two or more persons who are subject to
possible indictment in connection with the same transactions
make confidential statements to their attorneys, these
statements, even though they are exchanged between attorneys,
should be privileged to the extent that they concern common
issues and are intended to facilitate representation in
possible subsequent proceedings.”).
joint defense privilege has been extended to civil cases. In
United States v. Gonzalez, 669 F.3d 974 (9th Cir.
2012), a husband and wife were convicted in separate trials
for fraud arising from an insurance scam. The wife
subsequently filed a petition for habeas corpus –
technically, a civil proceeding – arguing that her
trial counsel had been ineffective for failing to call as an
exculpatory witness the husband, who had given a statement
that the wife had nothing to do with the crime before
ultimately claiming at trial that the wife was responsible.
Id. at 976. When the government subpoenaed the
wife’s trial counsel about communications received from
the husband’s lawyer, the husband moved to quash the
subpoena on the basis of the joint defense privilege.
Id. at 976-77.
Ninth Circuit acknowledged that it “has long recognized
that the joint defense privilege is ‘an extension of
the attorney-client privilege.’” Id. at
978 (citations omitted). The court explained:
[w]hether the jointly interested persons are defendants or
plaintiffs, and whether the litigation or potential
litigation is civil or criminal, the rationale for the joint
defense rule remains unchanged: persons who share a
common interest in litigation should be able to
communicate with their respective attorneys and with each
other to more effectively prosecute or defend their claims.
Id. at 978 (citing In re Grand Jury
Subpoenas, 902 F.2d 244, 249 (4th Cir. 1990) (emphasis
added)). The court also made clear that parties invoking the
privilege “need not have identical interests and may
even have some adverse motives, ” but they must at
least “be engaged in maintaining substantially the same
cause on behalf of other parties in the same
litigation.” Id. at 980-81 (quotation marks
and citations omitted). The Ninth Circuit found that a joint
defense agreement existed between the husband and wife prior
to the trials, but found that the arrangement may have ended
before the trials and therefore remanded for further
proceedings. Id. at 983.
these cases we learn that the joint defense privilege, or,
more broadly, the common interest privilege, is essentially
an extension of the attorney-client privilege. Director
Bergin argues that the privilege applies in the absence of
pending litigation. Doc. 228 at 2-4. He is correct; pending
litigation is not a prerequisite. Gonzalez, 669 F.3d
at 978 (citing In re Grand Jury Subpoenas, 902 F.2d
Bergin next argues that the privilege may apply in the
regulatory context. Doc. 228 at 4. The Director cites cases
involving the regulatory context, but none is particularly
helpful. This case is unlike United States v.
Bergonzi, 216 F.R.D. 487 (N.D. Cal. 2003), which
involved a direct adversity between the regulator and the
regulated party that is absent here. Nor is this case like
Broessel v. Triad Guaranty Insurance Co., 238 F.R.D.
215 (W.D. Ky. 2006), which recognized a common legal interest
“that extends to legislative and regulatory matters, as
well as in matters in litigation or could lead to
litigation.” Id. at 220. Broessel
does not shed light on whether a regulator like the Arizona
Department of Gaming may enter into a common interest
agreement with an entity it regulates for the purpose of
opposing the actions of another entity it regulates.
closest case to this dispute appears to be In re Lidoderm
Antitrust Litigation, MDL No. 2521, 2016 WL 861019 (N.D.
Cal. 2016), which involved the denial of the common interest
privilege to parties that shared only a common commercial or
business interest, rather than a common legal interest.
Id. at *4. As the court in Lidoderm
explained: “the common interest privilege protects
documents shared between parties who have a common
legal interest; it does not extend to and cannot
protect disclosure of communications regarding a common
business interest.” Id. (emphasis in
original); see also In re Pac. Pictures Corp., 679
F.3d 1121, 1129 (9th Cir. 2012) (“a shared desire to
see the same outcome in a legal matter is insufficient to
bring a communication between two parties within this
exception”); Nidec Corp. v. Victor Co. of
Japan, 249 F.R.D. 575, 578 (N.D. Cal. 2007) (“that
legal assistance must pertain to the matter in which the
parties have a joint legal interest, and the communication
must be designed to further that specific legal
Bergin has not identified a common legal interest between the
Arizona Department of Gaming and Gila River. True, they share
a common goal of stopping the West Valley Resort, but this
common interest is not akin to those shared by parties faced
with or seeking to assert the same criminal or civil claims.
Gila River has a strong commercial incentive to stop the West
Valley Casino. Director Bergin’s interest is not
commercial. As a state regulator, he seeks to bar what he
views as a fraudulently procured casino operation. Despite
multiple opportunities to do so, Director Bergin has been
unable to locate, and the Court has not found, a single case
recognizing a common interest privilege in similar
Nation notes, correctly, that recognition of a common
interest privilege in this case would constitute a
significant extension of the doctrine. Doc. 227 at 4-5. The
Court cannot find in the roots of the joint defense privilege
a reasonable basis for extending the doctrine to parties who
merely share a common goal with no common legal interests.
Court also finds troubling the notion that a state regulatory
body could join in a privilege-protected partnership with one
of the entities it regulates to thwart expansion efforts of
another entity it regulates, whether or not the regulatory
body has a valid basis for opposing the expansion. That
appears to be what is happening here. The Nation identifies
several relevant circumstances surrounding Entry 102,
including the timing with respect to the vendor letters, the
involvement of a lobbyist for Gila River, and additional
letters to the Congressional Budget Office and the Arizona
Department of Liquor Licenses and Control.
it is appropriate for the Director to partner with a
regulated entity in such actions is a question beyond the
scope of this order or the jurisdiction of this Court, but to
say that their communications in such an endeavor are
privileged and immune from discovery is quite another matter.
The Court can find no basis for such an expansive privilege
in the case law, and sees ample reasons for caution ...