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Greyhound Lines Inc. v. Viad Corp.

United States District Court, D. Arizona

September 8, 2016

Greyhound Lines Incorporated, Plaintiff,
v.
Viad Corporation, Defendant.

          ORDER

          David G. Campbell United States District Judge.

         Plaintiff Greyhound Lines, Inc. seeks to compel production of certain documents that Defendant Viad Corporation has withheld as privileged. Doc. 54. The Court held a telephonic conference with the parties to discuss this issue. Doc. 56. As a result, Greyhound submitted for in camera review three representative documents from each of six disputed categories, and the parties provided a matrix setting forth their arguments on each category. Doc. 60. After reviewing the representative documents and the parties' arguments, the Court will grant Plaintiff's motion in part and deny it in part.

         I. Legal Standard.

         A. Attorney-Client Privilege.

         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.” Fed.R.Evid. 501. This case includes federal and state claims (Doc. 30), but the parties do not address whether federal or state privilege law should apply. When state law does apply, Rule 501 “does not tell us which state law the forum state should apply.” KL Grp. v. Case, Kay & Lynch, 829 F.2d 909, 918 (9th Cir. 1987). Commentators have suggested several methods of resolving this choice-of-law issue: (1) use the privilege law of the state whose substantive law provides the rule of decision; (2) apply the privilege law of the state in which the federal court sits; or (3) apply the choice-of-law doctrine of the state in which the federal court sits. Id. (citing 23 C. Wright & K. Graham, Jr., Federal Practice and Procedure § 5435, at 865-69 (1980); 2 Weinstein's Federal Evidence § 501[02] (1986)). The parties do not address this choice of law issue either.

         Greyhound relies on an Arizona statute that defines the attorney-client privilege for corporations, A.R.S. § 12-2234. Doc. 60-1 at 1. Viad does object to the use of this statute, and does not cite contrary authority. Id. at 1-8. Because Greyhound is the party challenging Viad's assertion of the privilege, and Viad does not object to Greyhound's legal arguments, the Court will apply the Arizona statute and relevant cases.

         The attorney-client privilege “is rigorously guarded to encourage full and frank communications between attorneys and their clients and thereby promote broader public interests in the observance of law and the administration of justice.” State v. Sucharew, 66 P.3d 59, 64, ¶ 10 (Ariz.Ct.App. 2003) (citing State v. Towery, 920 P.2d 290, 299 n.6 (Ariz. 1996) (internal quotation marks omitted)). “The privilege belongs to the client and encompasses communication between the attorney and client made in the course of the attorney's professional employment.” Id. (citing State v. Holsinger, 601 P.2d 1054, 1058 (Ariz. 1979)). A.R.S. § 12-2234 protects “any communication” that is either “[f]or the purpose of providing legal advice to the entity, ” or “[f]or the purpose of obtaining information in order to provide legal advice to the entity[.]” A.R.S. § 12-2234(B)(1), (2). The privilege protects communications. A.R.S. § 12-2234(B). “The burden of showing the relationship, the confidential character of the communication, and other necessary facts, is that of the party claiming the privilege.” State v. Sands, 700 P.2d 1369, 1374 (Ariz.Ct.App. 1985) (citation omitted).

         B. Work-Product Doctrine.

         Federal law governs application of the work product doctrine. Bickler v. Senior Lifestyle Corp., 266 F.R.D. 379, 382 (D. Ariz. 2010) (citing cases). “Ordinarily, a party may not discover documents and tangible things that are prepared in anticipation of litigation or for trial by or for another party or its representative (including the other party's attorney, consultant, surety, indemnitor, insurer, or agent).” Fed.R.Civ.P. 26(b)(3)(A). The party claiming work-product protection bears the burden of proof. Conoco Inc. v. U.S., 687 F.2d 724, 728 (3d Cir. 1982).

         II. Analysis.

         A. Category 1: Reports Prepared by Dr. Kenneth Ries.

         Greyhound challenges Viad's privilege assertion for certain monthly and quarterly reports prepared by Dr. Kenneth Ries for lawyers in Viad's law department. Doc. 60-1 at 1-2. Greyhound argues that the reports are not privileged because they are factual in nature, Dr. Ries did not seek legal advice, and Dr. Ries did not label the reports “attorney-client privileged.” Greyhound also argues that Viad waived the privilege because its Rule 30(b)(6) witness did not know whether the reports were on the company's privilege log or which attorney specifically directed Dr. Ries to prepare the reports in prior years. Id.

         Viad provides the following evidence related to the reports. Dr. Ries was a non-lawyer member of Viad's legal department from 1987 to 2001. Docs. 60-4 at 2, ¶ 4; 60-5 at 2, ¶ 6. After 2001, Dr. Ries served as a consultant to Viad's law department, providing the “functional equivalent” of his previous services, but “on a more limited basis.” Doc. 60-4 at 2, ¶ 5. In this role, Dr. Ries “often provided monthly and quarterly reports and other information to Viad's General Counsel and others in Viad's law department.” Id. at ¶ 4. These reports were always prepared at the direction of lawyers in Viad's law department so that the lawyers could monitor the company's environmental obligations and provide appropriate legal advice. Docs. 60-4 at 2, ¶¶ 4, 7; 60-5 at 2, ¶ 6.

         Greyhound contends that the reports are not privileged because they are factual in nature. Doc. 60-1 at 1-2. To be protected, a communication must be made for the purpose of providing legal advice or for the purpose of obtaining information to provide legal advice. A.R.S. § 12-2234(B)(1), (2); see also In re Bard IVC Filters Prods. Liab. Litig., No. MDL 2641, 2016 WL 3970338, at *7 (D. Ariz. July 25, 2016). The affidavits of Dr. Ries and one of Viad's in-house lawyers establish that the reports were prepared at the direction of lawyers in Viad's law department, to enable the lawyers to provide legal advice to the company. Docs. 60-4 at 2, ¶¶ 4, 7; 60-5 at 2, ¶ 6. This is reinforced by the reports themselves, which address a wide range of topics on which lawyers typically advise clients, including ongoing and threatened litigation, settlement discussions and offers, general legal exposure, and regulatory action. The fact that these reports contained factual information ...


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