In re Lorazepam Clorazepate Antitrust Litigation

Full title: IN RE LORAZEPAM CLORAZEPATE ANTITRUST LITIGATION

Court: United States District Court, D. Columbia

Date published: Jul 16, 2001

MDL Docket No. 1290, Misc. No. 99-276 (TFH/JMF) (D.D.C. Jul. 16, 2001)

Opinion

MDL Docket No. 1290, Misc. No. 99-276 (TFH/JMF)

July 16, 2001

ORDER

JOHN M. FACCIOLA, United States Magistrate Judge.

Pursuant to the Memorandum Opinion issued herewith, I make the following tentative rulings:

Marked Ouestions from the deposition of Roger Foster

Page(s) Witness Question Tentative Ruling 23 Foster Has Board of Directors Sustained. Board's request to counsel asked Foster to do any was intended to be confidential. additional fact finding or report back to them about FTC action? 24 Foster Was anything distributed Overruled. May answer yes or no. If to Board with respect to answer is yes, and counsel asks what was any kind of economic distributed, Foster must say generally analysis, projections, or what is was, Whether Foster can be asked calculations concerning to produce will turn on application of the disgorgement? work product privilege. 43 Foster In conversations among Sustained. Discussion between Foster,. Foster, Puskar, and functioning as a client, and Disner, Disner, were particular functioning as attorney, were intended to transactions discussed or be confidential. was it a general discussion? 65 Foster What was the amount of Sustained. Irrelevant. legal fees paid to Mylan to date? 67 Foster Has Mylan made any Overruled. Rule 26 requires disclosure. insurance claims with respect to the litigation? 76 Foster What was the nature of Nature of objection not stated. If discussions among attorney-client, inapplicable because no lawyers for Mylan, communication from a client. If work Gyma, Profarmaco, product, then work product privilege Cambrex, and SST? applies unless plaintiff can meet 26(b)(3) standard. 77 Foster What was the nature of Nature of objection not stated. If discussions with Stupar attorney-client and Stupar is client, then concerning the factual communication intended to be content of depositions? confidential. If work product, then work product privilege applies unless plaintiff can meet 26(b)(3) standard. 110 Foster Was Foster asked by Overruled as to attorney-client privilege anyone to have Disner provided Foster need answer only yes or review a contract with no. Further inquiry tends to disclose Profarmaco? whether communication intended to be confidential. 113 Foster Did Foster provided Sustained. Viewing Foster as client, Disner with any communication was intended by Foster to information about how be confidential. many manufacturers were actively supplying API for these particular drugs? 114 Foster Was contract sent to Sustained. While nature of retention Disner for review as ordinarily not privileged, here it would antitrust attorney? tend to disclose a communication which was confidential. 116 Foster What were the Overruled. Objection based on disclosure differences between first of legal advice or legal analysis. But, and second draft of advice is not privileged and differences do document? not appear to disclose any confidential communication intended to be confidential. 129 Foster May Foster see document More information required. from Cambrex which is confidential pursuant to order? 143-144 Foster What was said at first More information required. telephone conference among lawyers for Mylan and lawyers for FIS and SST? 175 Foster What did Stupar tell Sustained. Communication intended to be Foster concerning effect confidential. of contact between Mylan and Gyma on other generic manufacturers such as Purepac? 176 Foster What was the substance Sustained. Communication intended to be of conversation between confidential. Foster and Stupar after receipt of fax from Fox? 210-211 Foster In discussions between More information required. Foster, Disner, and Rosdeicher on behalf of SST and FIS, was there a discussion of exchanging 10% of gross profits on lorazepam sales for SST to stay out of the market or a discussion of whether Mylan could substantially raise its prices if it had two main sources of API supply under control and Mylan's competitors' supplies would dry up for 12 to 18 months?

Privilege Log

Doc. Number Description Date Author Recipient Privilege Tentative Ruling 1. Handwritten 11/30/98 Stupar Foster AC/WP More information notes required 2. Handwritten Undated Stupar Foster AC/WP More information notes required 3. Fax 12/14/98 Stupar Ballard AC/WP AC-sustained cc: Foster WP-sustained 4. Fax 12/14/98 Stupar Ballard AC/WP AC-sustained cc: Foster WP-sustained 5. Report 11/25/98 Stupar Foster AC/WP AC-sustained WP-sustained 6. Report 11/25/98 Stupar Foster AC/WP AC-sustained WP-sustained 7. Report 11/25/98 Stupar Foster AC/WP More information required 8. Report 11/25/98 Stupar Foster AC/WP More information required 9. Report 11/25/98 Stupar Foster AC/WP AC-sustained WP-sustained 10. Fax 12/14/98 Stupar Foster AC/WP More information required 11. Report 11/25/98 Stupar Foster AC/WP More information required 12. Fax 8/13/98 Previs Jackson AC/WP AC-sustained Sunseri WP-more Foster information required Schilling Richardson Satter 13. Undated Summers AC More information Handwritten required notes 14. Fax 11/17/97 Disner Summers AC/WP More information required 15. Draft 11/13/97 Cambrex Mylan AC/WP More information CI required 16. Fax 11/13/97 Summers Disner AC/WP AC-sustained WP-sustained 17. Fax 11/13/97 Summers Disner AC/WP AC-sustained WP-overruled 18. Draft 11/24/97 AC More information required 19. EMPTY EMPTY 20. Draft 11/6/97 AC More information required 21. Draft 10/28/97 AC More information required 22. Draft 11/6/97 Jeffries Summers AC/WP More information CI required 23. Undated Summers Stupar AC More information Handwritten required notes 24. Fax 10/24/97 Stupar Clawges AC Overruled 25. Draft 10/24/97 AC Overruled 26. Draft Undated AC Overruled 27. Draft 10/23/97 AC Overruled 28. Draft 10/24/97 AC Overruled 29. Draft 10/24/97 AC Overruled 30. Draft 10/28/97 AC Overruled 31. Draft Undated AC Overruled 32. Fax 10/26/97 Disner Foster AC/WP More information required 33. Fax 10/29/97 Summers Disner AC Sustained 34. Fax 10/21/97 Summers Disner AC/WP AC-sustained WP-overruled 35. Draft 10/22/97 AC Overruled 36. Draft 10/21/97 AC More information required 37. Draft Undated AC More information required 38. Draft Undated AC Overruled 39. Draft Undated AC Overruled 40. Draft 7/20/97 AC Overruled 41. Draft Undated Summers AC More information required 42. 11/4/97 Summers AC/WP AC-sustained Handwritten CI WP-overruled notes 43. 11/3/97 Summers AC/WP More information Handwritten required notes 44. 10/21/97 Summers AC/WP AC-more information Handwritten CI required notes WP-overruled 45. Undated Beto WP More information Handwritten required notes 46. Draft Undated AC Overruled 47. Letter 12/18/97 Cambrex Foster AC/WP AC-overruled CI WP-more information required 48. 12/14/98 Deiriggi Foster AC/WP More information Handwritten required notes 49. Draft 11/18/96 Ford Jackson AC/WP More information Foster required DeGeorge 50. Letter 2/1/99 Smiley Puskar AC More information required 51. 8/31/98 Wolfe Foster AC/WP More information Memorandum cc: required Darby Doan Kann Roseher Schilling 52. EMPTY EMPTY 53. Draft 5/4/98 AC Overruled 54. Letter 11/6/97 Stupar Foster AC/WP More information Deiriggi required Buseman Summers O'Donnell DeBone 55. Letter 5/4/98 Newland Owens AC/WP AC-overruled WP-overruled 56. 11/19/97 Summers Foster AC/WP More information Memorandum required 57. Letter 3/17/98 Disner Foster AC/WP More information required 58. 3/3/98 DeGeorge Puskar AC/WP More information Memorandum cc: required Todd Jackson Foster Schilling 59. 2/27/98 DeGeorge Foster AC/WP More information Memorandum cc: Schilling required 60. Fax 6/25/98 Abbe Beto AC/WP AC-overruled WP-overruled 61. Undated Summers Beto AC/WP More information Handwritten required Memorandum 62. Fax 3/15/98 Krinke Foster AC/WP More information Beto required 63. Table 5/14/99 Workman Galioto AC/WP More information required 64. E-Mail 12/17/97 Jeffries Summers AC/WP AC-overruled CI WP-overruled 65. E-Mail 12/16/97 Jeffries Summers AC/WP AC-overruled CI WP-overruled 66. E-Mail 12/1/97 Jeffries Summers AC/WP AC-overruled WP-overruled 67. E-Mail 11/6/97 Jeffries Summers AC/WP AC-overruled CI WP-overruled 68. E-Mail 11/6/97 Jeffries Summers AC/WP AC-overruled CI WP-overruled 69. Undated Wilkins Calabria AC/WP More information Memorandum required 70. EMPTY EMPTY 71. Undated Beto WP Overruled Handwritten Notes 72. Report 11/25/98 Stupar Foster AC/WP More information required 73. Report 11/25/98 Stupar Foster AC/WP More information required 74. Fax 12/14/98 Stupar Ballard AC/WP More information cc: Foster required

Redacted Documents Privilege Log

Doc. Number Description Date Author Recipient Privilege Tentative Ruling 1. Board 1/14/99 Smiley AC/WP More information Minutes required 2. 2/10/98 Foster Sunseri AC/WP AC-overruled Memorandum Puskar WP-overruled 3. 2/2/99 AC Overruled Handwritten Notes 4. Report 5/10/99 Deiriggi Addicks AC Overruled Harper Bottini Owens Clark Wilson Darby DeBone Jackson Korman O'Donnell Richardson Sherry Sisto Stupar cc: Campbell Foster Puskar Sanzen 5. Report 2/24/99 Deiriggi Bottini AC Overruled Owens Clark Wilson Darby DeBone Jackson Korman O'Donnell Richardson Sherry Sisto Stupar cc: Campbell Foster Puskar Sanzen Todd 6. Report 4/8/99 Pittman Summers AC Overruled 7. Fax 4/7/99 Pittman Summers AC Overruled cc: Dale 8. Report 11/10/97 Deiriggi Addicks AC Overruled Owens Cayton Wilson Govil Huang Krinke LaCagnin Miller Monteleone Runyon Bottini Clark Darby DeBone Jackson O'Donnell Stupar cc: Campbell Foster Mancinelli Puskar Sanzen Sisto Todd 9. Report 4/24/98 Deiriggi Addicks AC Overruled Owens Cayton Wilson Govil Huang Krinke LaCagnin Mancinelli Miller Monteleone Runyon cc: Campbell Foster Puskar Sanzen Sisto Todd 10. Report 2/24/99 Deiriggi Bottini AC Overruled Owens Clark Wilson Darby DeBone Jackson O'Donnell Sisto Stupar cc: Campbell Foster Puskar Sanzen Todd 11. Fax 8/20/99 Foster Korman AC Overruled 12. EMPTY EMPTY 13. Memo 4/11/97 Marchetti Bergen AC Overruled Campbell Cayton Cosner Crunkleton Darby DeBone Hamrick Jackson Kann Krinke Mancinelli Marchetti McMillen Sanzen Sisto Stupar Summers Witt 14. Memo 3/11/97 Marehetti Bergen AC/WP More information Campbell required Cayton Cosner Crunkleton Darby DeBone Harorick Jackson Kann Krinke Mancinelli Marchetti McMillen Sanzen Sisto Stupar Summers Witt 15. Board 10/22/98 Smiley AC/WP More information minutes required 16. Board 7/30/98 Smiley AC/WP More information minutes required It is ordered that Plaintiffs' Motion to Compel [#19] is denied without prejudice. SO ORDERED.

MEMORANDUM OPINION

During the deposition of Roger Foster ("Foster"), counsel for defendants Mylan Laboratories, Inc. and Mylan Pharmaceuticals, Inc. ("Mylan") objected to certain questions on the grounds of privilege and irrelevancy. The privileges asserted were attorney-client and attorney work product. The "Direct Purchaser Plaintiffs" ("plaintiffs") have now moved to compel Foster's testimony as to those questions. In moving to compel, however, plaintiffs have all but ignored the law of this Circuit pertaining to the attorney-client privilege. With the exception of one case pertaining to waiver, plaintiffs never discuss the law of this Circuit which articulates with great specificity the nature of the attorney-client privilege.

As I have pointed out, in this Circuit the attorney-client privilege protects confidential communications made by the client to the attorney for the purpose of seeking legal advice or legal representation. Eugene Burger Management Corp. v. HUD, 192 F.R.D. 1, 4 (D.D.C. 1999) and cases therein. The attorney-client privilege protects the communications made by the attorney to the client, but only insofar as the attorney's communications disclose communications from the client. Id., and cases cited therein. Thus, an attorney's advice to a client is privileged from disclosure insofar as the disclosure of the advice would in turn disclose a communication from the client which the client intended to be confidential. An analogy is helpful. If a man asks a lawyer how to provide for an illegitimate child whose paternity he has never admitted, knowing the advice the lawyer gave would disclose the information the client provided in confidence. If, on the other hand, disclosure of the attorney's advice does not disclose anything the client communicated in confidence because, for example, the information given the lawyer by the client was not intended by the client to be confidential, there is no privilege for the advice. Thus, if two companies announce a merge and tell the world that a disinterested attorney had provided them with an opinion that their merger did not violate any antitrust laws, no court would protect what the attorney told them. The purpose of the attorney-client privilege is to encourage clients to be as candid as possible with their counsel. In re Sealed Case. 676 F.2d 793, 818 (D.C. Cir. 1982). There is, however, no reason to believe that clients would be less willing to share confidences with their attorneys if the court mistakenly protects as privileged advice which was does not reveal a communication that was intended to be confidential.

There is, of course, a second "privilege" operative here, namely the work product privilege. To protect the adversarial process and to free lawyers from concerns that documents which reveal how they are preparing for trial and their mental processes might be revealed to their opponents, Rule 26 protects from ordinary discovery "documents and tangible things" prepared in anticipation of litigation or for trial by a party or its representative, including its attorney. Fed.R.Civ.P. 26(b)(3). Unlike the attorney-client privilege, this privilege is defeated if the party seeking discovery establishes a substantial need for the documents or other tangible thing in the preparation of his case and also an inability, without undue hardship, to obtain their substantial equivalent by other means.

When the true nature of both privileges, one from disclosure and one from discovery, is appreciated, it becomes clear that plaintiffs' motion is misguided. Plaintiffs argue, for example, that the attorney-client privilege was waived because Mylan shared the advice at issue with other people. However, that puts the cart before the horse. Before determining whether a privilege has been waived, one must ask whether it exists in the first place. As I have just explained, the lawyer's advice is not in itself privileged; it becomes privileged only insofar as disclosing it explicitly or implicitly discloses what a client told the attorney in confidence to secure that advice or insofar as the advice was given to advance the attorney's representation of the client. It has to follow, then, that if the advice Foster gave or got with reference to any transaction or contract does not disclose anything an employee of Mylan told Foster in confidence to secure his advice or advance his representation of Mylan, the attorney-client privilege does not exist. It also follows that anything that Foster, in his capacity as a client, told outside counsel for Mylan in confidence to secure counsel's advice is equally privileged.

When the nature of the privilege is understood, the nature of the waiver becomes equally clear. The attorney-client privilege can be waived by any actions of the client which are inconsistent with an intention to keep the communication, shielded by the privilege, confidential. In re Subpoenas Duces Tecum, 738 F.2d 1367, 1370 (D.C. Cir. 1984). See also In re Sealed Case 676 F.2d 793, 811 (D.C. Cir. 1982).

When this is understood, it becomes apparent that plaintiffs also misunderstand the nature of the waiver which will force disclosure. If the advice Foster gave or got is not in itself privileged, whether he or any other employee of Mylan shared it with anyone is irrelevant. The real question is whether Foster, or anyone employed by Mylan. disclosed a confidential communication, otherwise protected by the attorney-client privilege, to anyone who did not have and could not claim an attorney-client privilege with Foster or with counsel for Mylan. If they did, then they waived the confidentiality of that communication.

The work product privilege can also be waived. In re Subnoena Duces Tecum. 738 F.2d at 1370-1375. But, leaping to a waiver analysis is unnecessary unless and until plaintiffs fail to defeat the work product privilege by establishing a substantial need for the documents and an inability to secure their substantial equivalent without undue hardship. F.R.Civ.P. 26(b)(3). In this case, if plaintiffs cannot make that showing, they have a right to try to establish that Mylan or Foster waived the work product privilege by behavior inconsistent with its protections.

It must be recalled that the work product privilege of Fed.R.Civ.P. 26(b)(3) is a privilege against the discovery of documents and tangible things prepared by an attorney for a party or in anticipation of litigation. Nevertheless, protecting an attorney's "mental impressions, conclusions, opinions, or legal theories of an attorney. . . . concerning the litigation," Fed.R.Civ.P. 26(b)(3), from disclosure is within the penumbra of the protection created by the Supreme Court's decision inHickman v. Taylor, 329 U.S. 495, 571 (1947), even though the attorney does not commit them to writing. Alexander v. FBI, 192 F.R.D. 12, 16 (D.D.C. 2000); Athridge v. Aetna Casualty Surety Co., 184 F.R.D. 200, 209 (D.D.C. 1998). It would be perverse to rule that an attorney could not be forced to disclose a memorandum to his file in which he summarized his impressions of the strength and weakness of a witness's testimony, but could be asked during a deposition to provide the same information. However, with that said, it must be remembered that the work product privilege pertains only to an adversarial context, arising only when litigation has commenced or is anticipated. There is no basis in any precedential authority of which I am aware for shielding from disclosure everything an attorney does or thinks merely because he is an attorney. Thus, I see a radical difference in Foster's "work product" (using the term generically) during negotiations which lead to the agreements at issue and his "work product" once litigation is truly anticipated. I am aware of no privilege which protects what Foster says to others during or about negotiations unless it discloses what a client told him in confidence. On the other hand, what Foster says to others once litigation is anticipated is protected if it tends to disclose his mental processes provided, as is true here, that it is reasonable to anticipate that Foster's client and those other persons will be parties on the same side of the anticipated litigation and are thereby preparing a common defense at the time of the discussions wherein Foster expresses his views and discloses his thinking as to the litigation.

My analysis of the legal issues is thus so radically different from plaintiffs' in their Motion to Compel that deciding it is a waste of time and I will deny it without prejudice. To prevent the rock from rolling back down the hill. I have provided the parties with my tentative rulings, using the principles articulated in this memorandum. By seeing how I anticipate I will finally rule and having a more complete understanding of howl interpret the privileges claimed, the parties may be able to resolve their differences and narrow their disputes to the essential. I emphasize, however, the word "tentative." It has been my constant experience that it is difficult, to the point of being impossible, to rule definitively and clearly on attorney-client and work product privileges solely on a single question or an entry in a privilege log. I find that I must often permit counsel, under my guidance, to ask additional questions to flesh out all of the circumstances surrounding the privilege claim. Additionally, while I keep them to the barest minimum, I have on occasion had to conduct an in camera voir dire examination, later sealing the transcript, in order to permit me to rule. Consistent with that experience, and because I understand that the parties contemplate that my rulings as to the questions posed to Foster may control the results in other depositions, I will order that the parties conduct any deposition (including the continuation of Foster's) in which a privilege will be claimed in my presence when I am available. If they wish, they may avail themselves of the court's video conferencing facilities or of the small courtroom next to my chambers if it is available. After I conduct whatever inquiry I see fit, and permit the parities to ask additional, relevant and appropriate questions I will rule.

Furthermore, I note that while plaintiffs premise their motion on the attorney-client privilege, other objections were made on grounds of relevance and violation of a protective order.

First, Foster was asked what legal fees Mylan had paid for its defense to date and for indemnification of other parties to the agreements which are the subject of this lawsuit. Foster at 65. He was also asked whether Mylan had filed a claim pertaining to this litigation with any insurance carrier. Foster at 67. Under Rule 26, as amended, a party "may obtain discovery regarding any matter, not privileged, that is relevant to the claim or defense of any party." Fed. R Civ. P. 26(b)(l). The amount of fees incurred is neither privileged nor relevant to any claim or defense asserted and I will sustain the objection.

Second, Rule 26 requires a party to produce "any insurance agreement under which any person carrying on an insurance business may be liable to satisfy part or all of a judgment which may be entered in the action or to indemnify or reimburse for payments made to satisfy the judgment." Fed.R.Civ.P. 26(a)(1)(D). Thus, without any consideration of relevancy, this Rule requires the production of any insurance agreement Mylan has with a carrier which "may be liable to satisfy part or all of a judgment which may be entered in the action or to indemnify or reimburse for payments made to satisfy the judgment." Id. Since the Federal Rules require production of such an agreement without even a request for it, they expressly authorize the question plaintiffs asked and Foster refused to answer. Foster will have to answer the question.

Finally, during Foster's deposition, plaintiffs' counsel tried to enter an exhibit identified as Bates number CP 01889. Mylan's counsel protested that this document "came out of Cambrex production" and "was probably highly confidential pursuant to the order." Foster at 129. He refused to let Foster see it. In their pleadings, the parties do not explain to me the nature of their dispute and what the "Cambrex production" is. Before Foster's deposition resumes, plaintiffs will have to file a supplemental submission answering Mylan's charge that a court order prohibited Foster's seeing the document.

An Order, containing my tentative rulings and denying plaintiff'sMotion to Compel without prejudice, accompanies this Memorandum Opinion.