Opinion
1:19-CV-00109 EAW
2021-09-20
Kristina R. KLOSIN, as Administrator of the Estate of Christopher J. Klosin, deceased, Plaintiff, v. E.I. DU PONT DE NEMOURS AND COMPANY, Wanfeng Compound Stone Technology Co. Ltd., Defendants.
James T. Scime, Melissa Dorothy Wischerath, Lipsitz Green Scime Cambria LLP, Buffalo, NY, for Plaintiff. Donna L. Burden, Burden, Gulisano & Hansen, LLC, Phyliss A. Hafner, Burden Hafner & Hansen, LLC, Buffalo, NY, for Defendant E. I. du Pont de Nemours and Company.
James T. Scime, Melissa Dorothy Wischerath, Lipsitz Green Scime Cambria LLP, Buffalo, NY, for Plaintiff.
Donna L. Burden, Burden, Gulisano & Hansen, LLC, Phyliss A. Hafner, Burden Hafner & Hansen, LLC, Buffalo, NY, for Defendant E. I. du Pont de Nemours and Company.
DECISION AND ORDER
ELIZABETH A. WOLFORD, Chief Judge
INTRODUCTION
Kristina R. Klosin ("Plaintiff") brings this action against defendants E.I. du Pont de Nemours and Company ("DuPont") and Wanfeng Compound Stone Technology Co. Ltd. ("Wanfeng"), for damages stemming from the death of her husband on June 25, 2018, from an incident that occurred at the Lockport, New York facility of non-party XPO Logistics Supply Chain, Inc. ("XPO"). (Dkt. 1-2 at 4-7; Dkt. 42). The action was removed to federal court on January 18, 2019. (Dkt. 1).
Nancy Mangine has filed a similar case against DuPont and Wanfeng, for the death of her husband in the same incident. (See Nancy Mangine, as Executrix of the Estate of Roger Mangine, deceased v. E.I. du Pont de Nemours and Company and Wanfeng Compound Stone Technology Co. Ltd. , Case No. 1:19-cv-00110). These cases have been consolidated for purposes of discovery. (Dkt. 87; Dkt. 88). However, only plaintiff Klosin has filed papers in connection with XPO's objections to Judge Roemer's discovery orders. Counsel for plaintiff Mangine appeared at the April 14, 2021 oral argument on XPO's objections but did not make argument in connection with the motion or otherwise express his opinion as to whether the documents at issue are not subject to any privilege.
Wanfeng has not responded to the amended complaint, and on May 20, 2021, the Clerk of Court entered default against it. (See Dkt. 118; see also Dkt. 121).
Presently before the Court are XPO's objections (Dkt. 55; Dkt. 93) to two discovery orders entered by the Hon. Michael J. Roemer, United States Magistrate Judge—the first dated June 3, 2020 (Dkt. 51) and the second dated December 29, 2020 (Dkt. 90). For the following reasons, XPO's objections are sustained in part and the discovery orders are vacated in part. Specifically, the Court reverses the decisions to the extent that the Magistrate Judge found that the documents at issue were not attorney work product, but affirms the decisions to the extent that he found that Plaintiff has a substantial need for at least a portion of the documents.
BACKGROUND AND PROCEDURAL HISTORY
The Court assumes the parties’ familiarity with the background facts relevant to XPO's objections, which are included in the Magistrate Judge's Decisions and Orders dated June 3, 2020 and December 29, 2020. (See Dkt. 51 at 1-3; Dkt. 90 at 1-3).
The dispute in question arises from an August 5, 2019 subpoena served by Plaintiff on XPO for documents regarding its investigation into the accident. (Dkt. 41-1). XPO produced several documents, as well as a privilege log listing other documents responsive to the subpoena. (See Dkt. 51 at 2; Dkt. 55 at 12). Judge Roemer directed XPO to provide him with the documents listed on the privilege log for in camera review, received submissions from the parties, and found that certain documents should be produced to Plaintiff. (See Dkt. 34; Dkt. 37; Dkt. 51; Dkt. 90).
XPO objects to the June 3, 2020 Decision and Order directing that it disclose to Plaintiff a complete copy of the Incident Investigation/Root Cause Analysis Report (hereinafter, the "incident report") dated January 30, 2019, and to the December 29, 2020 Decision and Order directing that XPO disclose certain additional documents to Plaintiff, including drafts of the incident report, photographs taken of the accident scene and relevant to the shipping container, findings regarding improved unloading processes, employee training documents, job hazard worksheets, training records, product handling publications and information, communications between XPO and DuPont involving information requests and responses, and internal email communications between XPO employees, which the Magistrate Judge determined to be non-privileged. XPO contends that these documents are subject to either the attorney-client privilege or the attorney work product privilege. (Dkt. 55; Dkt. 93).
At oral argument on April 14, 2021, XPO stated that it had produced to Plaintiff all photographs contained in the incident report and prior drafts of the report.
The Court set briefing schedules on XPO's objections (Dkt. 57; Dkt. 94) , and on April 14, 2021, the Court held oral argument on the objections (Dkt. 98; Dkt. 104). At oral argument, XPO clarified that it objected to the Magistrate Judge's decisions to the extent they ordered production of the following documents: (1) the incident report; (2) drafts of the incident report; and (3) documents reflecting content that was ultimately incorporated into the drafts and final report, including interviews of employees in response to the OSHA investigation, and strategic information addressing concerns raised by OSHA to persuade OSHA not to take civil or criminal action against the company. Following oral argument, Plaintiff and XPO made further submissions to the Court. (Dkt. 105; Dkt. 106; Dkt. 110; Dkt. 111).
On July 13, 2020, XPO filed a motion to stay execution of the Magistrate Judge's order requiring it to produce the incident report, and a motion to expedite consideration of its motion. (Dkt. 67; Dkt. 68). The Court granted the motion to expedite and set a briefing schedule on the motion to stay (Dkt. 69), which the Court also granted (Dkt. 98).
DISCUSSION
I. Legal Principles
A. Standard— Fed. R. Civ. P. 72(a)
The standard of review with respect to XPO's objections is highly deferential—the Magistrate Judge's determination is nondispositive, and therefore it may be set aside only if clearly erroneous or contrary to law. See , e.g. , Eisai Ltd. v. Dr. Reddy's Labs., Inc. , 406 F. Supp. 2d 341, 342 (S.D.N.Y. 2005) ("Under Fed. R. Civ. P. 72(a), a District Court may set aside a Magistrate Judge's determination on a ‘[n]ondispositive [m]atter[ ]’ only if that determination is ‘clearly erroneous or contrary to law.’ Discovery rulings ... are nondispositive matters subject to that standard of review." (alterations in original)). "[A] district court may reverse the order only if on the entire evidence, the district court is left with the definite and firm conviction that a mistake has been committed." Rodriguez v. Pie of Port Jefferson Corp. , 48 F. Supp. 3d 424, 425 (E.D.N.Y. 2014) (quotations and citations omitted); see also Khaldei v. Kaspiev , 961 F. Supp. 2d 572, 575 (S.D.N.Y. 2013) (explaining that an order "is contrary to law if it fails to apply or misapplies relevant statutes, case law or rules of procedure" (quotation omitted)); Flaherty v. Filardi , No. 03 Civ. 2167(LTS)(HBP), 2009 WL 749570, at *19 (S.D.N.Y. Mar. 20, 2009) ("The clearly erroneous standard is highly deferential, and magistrate judges are afforded broad discretion in resolving non-dispositive disputes...." (quotations, citation, and alterations omitted)), aff'd , 460 F. App'x 66 (2d Cir. 2012).
B. Privileges
XPO claims that two privileges are applicable to the documents ordered produced by the Magistrate Judge: the work product privilege and the attorney-client privilege.
1. Work Product Privilege
The work product doctrine protects documents and tangible things "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) ; see also Hickman v. Taylor , 329 U.S. 495, 510-11, 67 S.Ct. 385, 91 L.Ed. 451 (1947) (recognizing work product doctrine). The common law work product doctrine articled in Hickman is partly codified by Rule 26(b)(3). Tankleff v. Cnty. of Suffolk , No. 09-CV-1207, 2011 WL 5884218, at *2 (E.D.N.Y. Nov. 22, 2011).
The doctrine "protects not only materials which are prepared by attorneys themselves, but also by their agents," which include "those who are enlisted by legal counsel to perform investigative or analytical tasks to aid counsel in preparing for litigation." Costabile v. Westchester, New York , 254 F.R.D. 160, 164 (S.D.N.Y. 2008). Its purpose is "to preserve a zone of privacy in which a lawyer can prepare and develop legal theories and strategy with an eye toward litigation, free from unnecessary intrusion by his adversaries." United States v. Adlman, 134 F.3d 1194, 1196 (2d Cir. 1998) (quotation omitted). "There are two types of work product, ordinary or fact ... and opinion. As we have stated previously, fact work product may encompass factual material, including the result of a factual investigation. In contrast, opinion work product reveals the ‘mental impressions, conclusions, opinions, or legal theories of an attorney or other representative,’ and is entitled to greater protection than fact work product." In re Grand Jury Subpoena Dated July 6, 2005 , 510 F.3d 180, 183 (2d Cir. 2007) (citations omitted). "When evaluating whether to order disclosure of work product, courts have consistently distinguished between primarily factual work product and ‘core’ [opinion] work product," and "[a]lthough factual work product is subject to disclosure once the required showings are made, core work product is entitled to more stringent protection, protection described by some courts as ‘absolute’ or ‘near absolute.’ " Crosby v. City of New York , 269 F.R.D. 267, 277-78 (S.D.N.Y. 2010) (citations omitted).
"Analysis of one's case in anticipation of litigation is a classic example of work product[.]" Id. at 1196-97 (quotation and citation omitted). However, "[d]ocuments prepared in anticipation of litigation are work product, even when they are also intended to assist in business dealings." Schaeffler v. United States , 806 F.3d 34, 43 (2d Cir. 2015) ; see also Adlman , 134 F.3d at 1198 ("[n]owhere does Rule 26(b)(3) state that a document must have been prepared to aid in the conduct of litigation in order to constitute work product, much less primarily or exclusively to aid in litigation"). As further explained by the Second Circuit:
[ Adlman ] established a test to determine whether documents should be deemed prepared "in anticipation of litigation" and therefore subject to work-product protection. A document will be protected if, "in light of the nature of the document and the factual situation in the particular case, the document can fairly be said to have been prepared or obtained because of the prospect of litigation." Adlman, 134 F.3d at 1202 (citations omitted). Conversely, protection will be withheld from "documents that are prepared in the ordinary course of business or that would have been created in essentially similar form irrespective of the litigation." Id.
Rule 26(b)(3) further provides that materials qualifying as attorney work product may be discovered if "they are otherwise discoverable under Rule 26(b)(1)," and if "the party shows that it has substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means." Fed. R. Civ. P. 26(b)(3)(A)(i) & (ii) ; see also In re Grand Jury Proceedings , 219 F.3d 175, 190 (2d Cir. 2000) ("A party seeking discovery of attorney work-product must show ‘substantial need,’ for fact work-product."). "Even where this showing has been made, however, the Rule provides that the court ‘shall protect against disclosure of the mental impressions, conclusions, opinions, or legal theories of an attorney or other representative of a party concerning the litigation.’ " Adlman , 134 F.3d at 1197 (quoting Fed. R. Civ. P. 26(b)(3) ).
The work product privilege may be waived but is "not waived merely because the material is disclosed to a third party." Pearlstein v. BlackBerry Ltd. , No. 13-CV-07060 (CM)(KHP), 2019 WL 1259382, at *7 (S.D.N.Y. Mar. 19, 2019). Rather, "[p]rotection is waived only when work product is disclosed to a third party in a manner that is inconsistent with the purpose of the protection." Id. ; see also In re Steinhardt Partners, L.P. , 9 F.3d 230, 235 (2d Cir. 1993) ("Common sense and the practicalities of litigation define the limits of the work product doctrine. Once a party allows an adversary to share the otherwise privileged thought processes of counsel, the need for the privilege disappears. Courts therefore accept the waiver doctrine as a limitation on work product protection. The waiver doctrine provides that voluntary disclosure of work product to an adversary waives the privilege as to other parties." (internal citation omitted)).
2. Attorney-Client Privilege
In diversity cases, state law governs application of the attorney-client privilege. "The elements of the attorney-client privilege under New York law are the existence of an attorney-client relationship, a communication made within the context of that relationship for the purpose of obtaining legal advice, and the intended and actual confidentiality of that communication." Bowne of N.Y.C., Inc. v. AmBase Corp. , 161 F.R.D. 258, 264 (S.D.N.Y. 1995) (citing People v. Osorio, 75 N.Y.2d 80, 84, 550 N.Y.S.2d 612, 549 N.E.2d 1183 (1989) ). "The party asserting privilege carries the burden of establishing ‘that the communication at issue was between an attorney and a client for the purpose of facilitating the rendition of legal advice or services, in the course of a professional relationship;’ that the communication ‘is predominantly of a legal character;’ and that the communication was confidential." Meskunas v. Auerbach , No. 17 Civ. 9129 (VB)(JCM), 2020 WL 7768486, at *2 (S.D.N.Y. Dec. 30, 2020) (quoting Ambac Assur. Corp. v. Countrywide Home Loans, Inc. , 27 N.Y.3d 616, 624, 36 N.Y.S.3d 838, 57 N.E.3d 30 (2016) ); see also Charlestown Cap. Advisors, LLC v. Acero Junction, Inc. , No. 18-CV-4437 (JGK) (BCM), 2020 WL 757840, at *3 (S.D.N.Y. Feb. 14, 2020) ("the party asserting the privilege bears the burden of establishing each element through competent evidence").
The purpose of the attorney-client privilege is to "encourage full and frank communication between attorneys and their clients and thereby promote broader public interests in the observance of law and the administration of justice." Pritchard v. Cnty. of Erie, 546 F.3d 222, 228 (2d Cir. 2008) (quoting Swidler & Berlin v. United States, 524 U.S. 399, 403, 118 S.Ct. 2081, 141 L.Ed.2d 379 (1998) ). The privilege "exists to protect not only the giving of professional advice to those who can act on it but also the giving of information to the lawyer to enable him to give sound and informed advice." Upjohn Co. v. United States, 449 U.S. 383, 390, 101 S.Ct. 677, 66 L.Ed.2d 584 (1981). However, the attorney-client privilege "is narrowly construed because the application of the privilege renders protected relevant information undiscoverable." Sparrow Fund. Mgmt. LP v. MiMedx Grp., Inc. , No. 18-cv-4921 (PGG)(KHP), 2021 WL 1930294, at *2 (S.D.N.Y. May 13, 2021). To that end, "the client may not reflexively withhold every communication with its attorney as privileged," because not all communications to an attorney are privileged. Charlestown Cap. Advisors, LLC , 2020 WL 757840, at *4. Rather, "[i]n order to make a valid claim of privilege, it must be shown that the information sought to be protected from disclosure was a ‘confidential communication’ made to the attorney for the purpose of obtaining legal advice or services." Id. (quoting Priest v. Hennessy , 51 N.Y.2d 62, 69, 431 N.Y.S.2d 511, 409 N.E.2d 983 (1980) ).
II. Analysis
In briefing this issue before the Magistrate Judge, XPO initially argued that the documents at issue are protected pursuant to both the attorney work product privilege and the attorney-client privilege. (Dkt. 38; Dkt. 39). In response, Plaintiff argued that the documents were not subject to either claim of privilege and, even if they were, XPO had waived this privilege by providing them to counsel for DuPont and to OSHA. (Dkt. 41).
The Magistrate Judge found that the incident report was not subject to any privilege because: (1) XPO failed to meet its burden of showing that the incident report would not have been prepared in substantially similar form but for the prospect of litigation, as there were business reasons for XPO's management team to conduct an internal investigation; (2) the incident report did not meet the requirements of the attorney-client privilege under New York law; and (3) even if the incident report was determined to be attorney work product, Plaintiff had an "extraordinary need" for production of the report and was therefore entitled to it pursuant to Rule 26(b)(3)(A). (Dkt. 51 at 4-9). With regard to the remaining documents, which consist of drafts of the incident report, photographs, findings regarding improved unloading processes, training documents, job hazard worksheets, training records, product handling publications, communications between XPO and DuPont involving information requests and responses, and emails, the Magistrate Judge applied the same reasoning with respect to application of the work product and attorney-client privileges and determined that several of the documents at issue were not subject to either privilege. (Dkt. 90). The Magistrate Judge specifically highlighted several of the emails which, while copied to counsel, were between XPO employees, were not directly between an attorney and client, and were not made for purposes of obtaining legal advice. (Id. at 5). Neither of the Magistrate Judge's decisions reached the issue of whether XPO had waived any claimed privilege by allegedly providing the documents to OSHA or DuPont.
A. Work Product Doctrine and Non-Parties
Before reaching the merits of XPO's objections, the Court first addresses the threshold question of whether XPO, as a non-party, may assert the work product privilege. At least some case law suggests that a non-party, such as XPO, cannot assert work product protection pursuant to Rule 26. See, e.g. , Egiazaryan v. Zalmayev , 290 F.R.D. 421, 437 (S.D.N.Y. 2013) (holding that non-party could not assert work product privilege over e-mails, and noting that "[b]ecause Fed. R. Civ. P. 26(b)(3) does not apply to nonparties ... no protection pursuant to Rule 26 attaches to these documents"); see also Ricoh Co., Ltd. v. Aeroflex Inc. , 219 F.R.D. 66, 68 (S.D.N.Y. 2003) ("The privilege extends only to documents prepared in anticipation of litigation by or for another party to the litigation or his representative. F.R.C.P. 26(b)(3). Communications between two non-parties to a litigation, neither of whom is a ‘representative’ of a litigating party, do not fall within the scope of the attorney work product."); Abdell v. City of New York , No. 05 Civ. 8453 KMK JCF, 2006 WL 2664313, at *2 (S.D.N.Y. Sept. 14, 2006) ("By its own terms, Rule 26(b)(3) does not protect materials prepared by lawyers for non-parties. This makes sense; the primary function of the rule is to foster the attorney's adversary role in a system of open discovery."). Neither the Magistrate Judge nor the parties addressed this issue. XPO has asserted the work product privilege pursuant to Rule 26 (see, e.g. , Dkt. 38 at 3), and the Magistrate Judge also applied Rule 26 in determining that the documents at issue did not qualify as attorney work product (see Dkt. 51 at 3-4). However, the Magistrate Judge did not specifically determine whether the work product doctrine extended to XPO, presumably because he concluded that the documents were not created in anticipation of litigation and therefore XPO could not claim work product protection for them in any case.
Although by its terms Rule 26 does not apply to nonparties, the "broader common law work product doctrine" may extend application of the work product privilege to nonparties. Tankleff , 2011 WL 5884218, at *1-2 ; see also Estate of Dabela v. Town of Redding , No. 3:16cv534(RNC), 2018 WL 1445577, at *2 (D. Conn. Mar. 23, 2018) ("The work product doctrine under Hickman extends to nonparties and depositions."). As explained by one court:
Nevertheless, the work-product doctrine articulated in Hickman and its progeny, which is broader than the protection supplied by Rule 26(b)(3), may have application here. "Courts have extended work-product protection to non-parties when doing so vindicated the purposes underlying the Hickman doctrine." There are at least three such purposes: protecting an attorney's ability to formulate legal theories and prepare cases, preventing opponents from "free-loading" off their adversaries’ work, and preventing interference with ongoing litigation. "In some instances it was also significant that the non-party was at least potentially a party or had interests that were likely to be affected by the litigation in which the work product was sought."
Crosby , 269 F.R.D. at 277 (alterations and citations omitted); see also Vasquez v. City of New York , No. 10-CV-6277 (JMF), 2014 WL 6356941, at *1 (S.D.N.Y. Nov. 14, 2014) ("Specifically, ‘[c]ourts have extended work-product protection to non-parties when [doing so] vindicated the purposes underlying the [ Hickman ] doctrine,’ including ‘protecting an attorney's ability to formulate legal theories and prepare cases, preventing opponents from "free-loading" off their adversaries’ work, and preventing interference with ongoing litigation.’ ") (alterations in original) (quoting Schomburg v. New York City Police Dep't , 298 F.R.D. 138, 142-43 (S.D.N.Y. 2014) ); see also Tankleff , 2011 WL 5884218, at *2 (common law "[w]ork product protection is appropriate where disclosure would (1) alter attorney behavior, (2) reward sloth, or (3) interfere with ongoing litigation" (quotations and citation omitted)). Courts have also found it appropriate to consider whether the non-party asserting work product protection "was at least potentially a party or had interests that were likely to be affected by the litigation in which the work product was sought." Jean v. City of New York , No. CV-09-801(RJD)(VVP), 2010 WL 148420, at *2 (E.D.N.Y. Jan. 12, 2010) ; see also Basinger v. Glacier Carriers, Inc. , 107 F.R.D. 771, 771-72 (M.D. Pa. 1985) (granting protective order to non-party insurance company and assistant claims manager to prohibit defendants from examining documents contained in insurance carrier's investigatory file and preventing them from deposing claims manager, explaining that both the insurance company and the claims manager "may become parties because of the circumstances of the accident").
After reviewing the materials submitted to the Magistrate Judge, including the declarations submitted by the Senior Vice President and General Counsel for XPO, Richard Valitutto ("Valitutto"), the Court finds that XPO may invoke the work product privilege because non-disclosure of the documents at issue would protect XPO's counsel's ability to formulate legal theories and prepare cases and, as further explained below, some of the materials at issue are "core" or opinion work product. See Tankleff , 2011 WL 5884218, at *2 ("the OAG may invoke the common law work product doctrine because non-disclosure would promote the first and third objectives of the work product doctrine and because the materials to be protected are squarely ‘core’ work product," and "[r]equiring disclosure could have a chilling effect on when and how OAG attorneys commit their thoughts to paper"); see also Crosby , 269 F.R.D. at 278 ("The high degree of protection accorded to core work product is such that not only parties, but also non-parties have been able to protect it even where work-product protection was otherwise denied."). As further explained below, the Valitutto declarations support that the documents at issue were prepared in anticipation of litigation, and if the Court were to hold that XPO could not assert a privilege over these documents and require their disclosure on that basis, counsel may be deterred from taking a similar investigation when preparing for litigation stemming from a future accident.
Further, the Court finds that under the factual circumstances in this case, XPO has interests likely to be affected by the outcome of the ligation. Pursuant to the indemnity provision in the Warehouse Agreement between XPO and DuPont, XPO is required to indemnify DuPont for all liabilities and expenses resulting from the death of any person and, in the event XPO is determined not to be solely at fault, then XPO would indemnify DuPont in proportion to their respective causative negligence. (Dkt. 52-1 at ¶ 12). In other words, because XPO is required to indemnify DuPont for any liabilities and expenses resulting from the accident in question, it arguably has an interest affected by the outcome of this litigation. Accordingly, consistent with the principles articulated in Hickman , the Court finds that it is appropriate to extend application of the work product doctrine to XPO. The Court now turns to whether the Magistrate Judge's determination that the documents at issue are not attorney work product was clearly erroneous or contrary to law.
B. The Incident Report, Drafts of the Incident Report, and Documents Reflecting Content Incorporated into the Incident Report are Attorney Work Product
In support of its argument that the Magistrate Judge erred in finding that the incident reports and documents reflecting content incorporated into those reports are not protected by the work product privilege, XPO relies primarily on the Valitutto declarations. (Dkt. 39 at ¶ 1; Dkt. 52-1; see also Dkt. 55). Valitutto stated that he "initiated and conducted th[e] investigation in anticipation of litigation with the Occupational Safety and Health Administration (‘OSHA’)," because he knew that investigators from OSHA would be on the scene and that such an investigation can result in both civil and criminal litigation. (Dkt. 39 at ¶¶ 3-4). Valitutto directed Michael Wahl, the Director of Safety at the Lockport facility, to conduct the investigation, which Valitutto and another in-house lawyer oversaw, with assistance from outside counsel Mark Lies. (Id. at ¶¶ 4-5). Valitutto also informed the management team that he would be coordinating the investigation and that he should be included on all communications regarding the OSHA investigation, which would be considered attorney-client privileged communications and attorney work product. (Id. at ¶ 5). As part of the investigation, Valitutto commissioned and assisted in creating the incident report, which he describes as "a summary of our investigation, including the interviews we conducted with various XPO Logistics employees, attorney mental impressions of witnesses and the facts developed." (Id. at ¶ 7). Valitutto states that the incident report is "classic work product" (Dkt. 52-1 at ¶ 1) and represents that it is "not a type of document prepared in the ordinary course of XPO Logistics’ business and would not have been created in substantially similar form but for the prospect of litigation." (Id. at ¶ 2). Valitutto specifically referenced the section of the incident report addressing corrective action and recommendations, the purpose of which was "to provide legal advice to executives in XPO Logistics to develop corrective and preventative actions in light of the accident and to mitigate potential litigation by OSHA." (Id. ). Various drafts of the incident report were created prior to finalizing the document. (Dkt. 39 at ¶ 7). A copy of the report was provided to counsel for XPO, who now represents DuPont. (Id. at ¶ 8).
At oral argument, the Court raised with counsel for XPO whether the work product privilege applied to the final incident report in light of the fact that it was completed on January 30, 2019, after XPO entered into a settlement with OSHA. (See Dkt. 105 at 1). Following oral argument, XPO filed a supplemental submission specifically addressing that question, arguing that the timing of the OSHA settlement does not invalidate the privilege, given that (1) the investigation was also conducted in response to potential civil litigation arising out of the accident, and (2) the majority view interpreting Rule 26(b)(3) is that the work product privilege does not expire after the anticipated litigation is terminated. (Id. ). In support of its first argument, XPO points to the July 31, 2018 litigation hold notice issued by Valitutto to the relevant record custodians, which provided that they had the obligation to preserve information subject to discovery in the OSHA investigation, any subsequent litigation arising from this agency proceeding, or "other litigation relating to this accident." (Id. ; see also PRIV 000354). XPO also points to Valitutto's reply declaration (Dkt. 52-1), wherein he states that the incident report "was prepared because of anticipated litigation," and specifically references the litigation hold letter, explaining that "in directing employees to preserve all relevant documents, I was clear from the outset that I was not only anticipating ‘subsequent litigation arising from’ the OSHA investigation but also ‘other litigation relating to this accident.’ " (Id. at ¶ 10).
In support of the latter argument, XPO cites to FTC v. Grolier, Inc. , 462 U.S. 19, 103 S.Ct. 2209, 76 L.Ed.2d 387 (1983), where the Supreme Court considered whether the work product component of Exemption 5 of the Freedom of Information Act applies when the litigation for which the requested documents were generated has been terminated. Id. at 20, 103 S.Ct. 2209. The Court held that it did, and in doing so addressed the work product protection provided by Rule 26(b)(3), which it found did "not in so many words address the temporal scope of the work-product immunity," but that "the literal language of the Rule protects materials prepared for any litigation or trial as long as they were prepared by or for a party to the subsequent litigation," and therefore "the work-product of agency attorneys would not be subject to discovery in subsequent litigation unless there was a showing of need[.]" Id. at 25, 103 S.Ct. 2209. While the Supreme Court's decision in FTC indicates that materials protected as attorney work product during litigation would remain protected after the litigation is resolved, it does not address the specific question at issue here; that is, whether the incident report could receive work product protection in the first instance, given that it was not issued until after the specter of litigation with OSHA had dissipated.
The determination as to whether materials are protected by the work product privilege as it is defined in Adlman is "necessarily fact-specific." Fingerhut ex rel. Fingerhut v. Chautauqua Inst. Corp., Inc. , No. 07-CV-502-JTC, 2013 WL 5923269, at *2 (W.D.N.Y. Oct. 31, 2013). The Court has carefully reviewed the Magistrate Judge's decisions and the incident report itself, including in conjunction with the remaining documents to which XPO asserts a claim of privilege, and the Valitutto declarations. The Magistrate Judge explained that his decision that the incident report should be disclosed was a "close call," noting that it "is not easy for a factfinder to determine what ‘would have’ happened in another hypothetical situation where the litigation potential was low." (Dkt. 51 at 4 (citation omitted)). The decision makes plain that the Magistrate Judge reviewed the Valitutto declarations (see id. at 5), but ultimately determined that the incident report was not work product, explaining that simply because an attorney participated in and supervised an investigation does not transform an investigative document into work product, and XPO had business reasons to conduct an internal investigation—including to determine how the accident occurred and who was responsible and to identify corrective actions to be taken to prevent recurrence—and therefore XPO did not meet its burden of proof in asserting a work product privilege over the incident report (id. at 5-6).
The problem with this analysis is that it is well-settled that "[d]ocuments prepared in anticipation of litigation are work product, even when they are also intended to assist in business dealings." Schaeffler , 806 F.3d at 43 ; see also Imperati v. Semple , No. 3:18-cv-01847 (RNC), 2020 WL 6441007, at *13 (D. Conn. Nov. 3, 2020) ("A document that is created because of a threat of litigation, and which analyzes that litigation, is protected by the work product doctrine even if it is also created and used for other business purposes."). In other words, the fact that the incident report had some other business benefit does not undermine the work product privilege. Investigative reports undertaken in connection with litigation have been found to be entitled to work product protection. See, e.g. , Aboeid v. Saudi Arabian Airlines, Inc. , No. CV-10-2518 (SJ)(VVP), 2012 WL 3637430, at *3 (E.D.N.Y. Aug. 22, 2012) ("Generally speaking, reports of investigations undertaken by a private investigator hired by a party in connection with an ongoing litigation are work-product."); see also Costabile , 254 F.R.D. at 164 (report prepared by investigator was work product, as it "was clearly prepared on behalf of plaintiffs’ former counsel in anticipation of litigation," recorded the investigator's findings based on his interviews of witnesses to the incidents, and the report was prepared at the attorney's request).
In support of his finding that the incident report is not attorney work product, the Magistrate Judge cited to In re Otal Investments Ltd. , No. 03 Civ. 4304(HB)(DFE), 2005 WL 1473925 (S.D.N.Y. June 22, 2015), which stemmed from a boating collision between the "M/V Kariba" and the "M/V Tricolor." Id. at *1. At issue in that case was a "Statement of Facts" prepared by the vessel's captain. According to the declaration submitted by the non-attorney representative of the owner of the Kariba vessel, the non-attorney representative was contacted regarding the collision and represented that he "anticipated litigation and therefore requested that a statement of facts be prepared by Kariba's Captain Kamola." Id. The non-attorney representative discussed the document with an attorney, made notes on the draft, and requested that the captain prepare a revised draft, on which the non-attorney representative also made notes. Id. These documents were produced by Kariba pursuant to a stipulation, which provided that "[i]n the event the Court determines the draft statements are privileged or protected by the work-product rule, they shall not be admissible in evidence at trial nor used in depositions or other discovery proceedings." Id. The court ultimately concluded that the documents were not privileged:
Whether Kariba's owners did or did not anticipate litigation, they had business reasons for obtaining a statement from their captain-to decide whether to take any measures with respect to the captain, and with respect to the vessel. Depending on what answers were given, such measures might prevent future accidents. I find that, if the prospect of litigation had not existed, Capt. Kamola would still have created the Statement of Facts and the revised Statement of Facts in essentially the same way, and his superiors would still have made the handwritten notations in essentially the same way.
Id. Otal Investments is distinguishable for several reasons. First, the factual statements prepared in that case were prepared at the direction of a non-attorney representative—not an attorney—as is the case here. While the Court is cognizant that application of the work product doctrine is not limited to materials produced only by lawyers, the Court at the same time notes that the non-attorney representative's statement that he "anticipated litigation," is far less compelling than the statement by Valitutto, who is an attorney and who knew that OSHA would be on scene shortly and further knew that such an investigation can result in both civil and criminal litigation, and which is further supported by the retention of outside counsel who specializes in OSHA investigations. Second, while the non-attorney representative in Otal Investments consulted with an attorney when reviewing the initial statement of facts provided by the captain, the involvement by attorneys in overseeing the investigation in this case was far more significant, including by being present on the site of the accident soon after it occurred to collect information and in communicating with employees regarding how the investigation—which included the creation of the incident report—would proceed. Finally, the documents at issue in Otal Investments , which were statements of facts, presumably by their nature contained only factual information provided by the captain of the vessel at the time of the collision. Here, the incident reports and documents containing information incorporated into those reports not only contain factual information regarding what occurred on June 25, 2018, but also include analysis and conclusions relating to why the accident occurred which, as further explained below, is subject to heightened protection from disclosure. Accordingly, the Court does not find Otal Investments instructive on this issue.
The court also concluded that, even if the Statements of Facts were protected by the work product privilege, they should still be produced pursuant to Rule 26(b)(3), as the other parties had shown a substantial need for the documents. Otal Investments , 2005 WL 1473925, at *2.
"The Second Circuit has interpreted the ‘in anticipation of litigation’ requirement broadly." Wultz v. Bank of China Ltd. , 979 F. Supp. 2d 479, 488 (S.D.N.Y. 2013) ; see also A. Michael's Piano, Inc. v. F.T.C. , 18 F.3d 138, 146 (2d Cir. 1994) ("The courts have taken a flexible approach in determining whether the work product doctrine is applicable, asking not whether litigation was a certainty, but whether the document was created ‘with an eye toward litigation.’ ") (quoting Hickman, 329 U.S. at 511, 67 S.Ct. 385 ). While a government investigation itself may not amount to litigation, "[m]any courts have held ... that once a governmental investigation has begun, litigation is sufficiently likely to satisfy the ‘anticipation’ requirement." In re Grand Jury Subpoena , 220 F.R.D. 130, 147 (D. Mass. 2004) (citing Martin v. Bally's Park Place Hotel & Casino, 983 F.2d 1252, 1261 (3d Cir. 1993) (materials prepared after an OSHA investigation had commenced were made in anticipation of litigation, where "[t]he correspondence and testimony reveal[ed] that the report was commissioned in response to OSHA's inquiry and out of concern that either OSHA or the employees would bring suit") and Guzzino v. Felterman, 174 F.R.D. 59, 63 (W.D. La. 1997) ("Federal courts have concluded that once an investigation by a federal agency has commenced, that a corporation may reasonably be said to anticipate litigation.")).
The incident report itself states that it was "prepared at the request of counsel," and was prepared for Valitutto. XPO has provided two sworn declarations from Valitutto, in which he states that the incident report was prepared in anticipation of litigation, including both the anticipated litigation resulting from the OSHA investigation and any subsequent litigation, and that the incident report would not have been created in substantially similar form but for the prospect of litigation. Valitutto's assertion that the incident report would not have been created but for the prospect of litigation is supported by the fact that the evidence presently before the Court shows that the creation of the report was prompted by an external investigation by OSHA—which was notified immediately of the accident, launched an investigation, and began interviewing employees on June 26, one day after the accident (see Dkt. 39 at ¶¶ 4, 6)—rather than pursuant to internal action. See Maertin v. Armstrong World Indus., Inc. , 172 F.R.D. 143, 149-50 (D.N.J. 1997) (distinguishing case where investigative reports were produced pursuant to internal investigation and court compelled production of reports, as opposed to production of documents prompted by investigations brought by external agencies, and explaining that "because outside parties were involved, it is unlikely that Armstrong's actions and the documents it created as a result were merely done as part of its ordinary course of business").
Although it is XPO's burden to show that the incident report is privileged, Plaintiff has offered no evidence contradicting the facts contained in the Valitutto declarations, and simply because the incident report also had some ancillary business benefit does not destroy the privileged nature of this document. Given the above facts, the incident report, drafts of the report, and documents reflecting information to be incorporated into the reports meet the "because of litigation" standard articulated in Adlman . See also Tudor Ins. Co. v. Stay Secure Const. Corp. , 290 F.R.D. 37, 40 (S.D.N.Y. 2013) ("A document is prepared in anticipation of litigation if in light of the nature of the document and the factual situation in the particular case, it can fairly be said to have been prepared or obtained because of the prospect of litigation." (quotations, citations, and alteration omitted)). Accordingly, the Court concludes that the Magistrate Judge erred in concluding that the incident report, drafts of the incident report, and documents reflecting content incorporated into those reports are not attorney work product.
C. Substantial Need
However, that is not the end of the Court's inquiry. "Once the movant meets the burden of showing that the materials were prepared in anticipation of litigation, then the opposing party has the burden of overcoming the protection." Maertin , 172 F.R.D. at 150 (citing Hickman , 329 U.S. at 512, 67 S.Ct. 385 ); see also Vasquez , 2014 WL 6356941, at *1 ("If a court determines that a document is attorney work product, it must next ask whether the document is ‘factual’ work product, which is ‘subject to disclosure once plaintiff has demonstrated substantial need,’ or ‘core’ work product that could reveal an attorney's mental process or legal strategy, which is ‘entitled to the highest protection afforded by law.’ " (citations omitted)). As explained above, the Magistrate Judge concluded that "even if the Incident Investigation Report was determined to be attorney work product, the Court sees an extraordinary need for the production of this report to plaintiff." (Dkt. 51 at 7).
Where documents are prepared in anticipation of litigation, a party may be entitled to them by showing "that it has substantial need for the materials ... and cannot, without undue hardship, obtain their substantial equivalent by other means." See Fed. R. Civ. P. 26(b)(3)(A)(ii). "A substantial need exists ‘where the information sought is "essential" to the party's defense, is "crucial" to the determination of whether the defendant could be held liable for the acts alleged, or carries great probative value on contested issues.’ " Gucci Am, Inc. v. Guess?, Inc. , 271 F.R.D. 58, 74-75 (S.D.N.Y. 2010) (quoting Nat'l Congress for Puerto Rican Rights v. City of New York, 194 F.R.D. 105, 110 (S.D.N.Y. 2000) ). The burden is on the party asserting a substantial need for the privileged document. Vermont Gas Sys., Inc. v. U.S. Fidelity & Guar. Co. , 151 F.R.D. 268, 277 (D. Vt. 1993) (" Rule 26(b)(3) permits disclosure of work product upon a showing of substantial need and inability to obtain the equivalent without undue hardship. The burden rests on the party seeking disclosure to make the requisite showing." (citations omitted)).
At oral argument on April 14, 2021, the Court raised that it was unclear the extent to which the record was developed on the issue of substantial need. XPO argued that Plaintiff has the burden to demonstrate substantial need and that she failed to do so. In response, Plaintiff pointed to her July 8, 2020 response papers to XPO's objections, and the attached exhibits containing excerpts from depositions of XPO employees, as establishing substantial need; however, as the Court explained at oral argument, objections to the decision and order of a magistrate judge on a non-dispositive issue are not entitled to de nov o review and, therefore, it would not be appropriate for the Court to consider this new material on an appeal from the Magistrate Judge's decision, where he did not have the opportunity to review these documents. At the conclusion of oral argument, the Court directed Plaintiff to submit a letter identifying where in the record before the Magistrate Judge substantial need was established, even if it was in the context of other discovery issues.
On April 21, 2021, Plaintiff filed on the docket a letter with attached exhibits in support of her position that the Magistrate Judge properly found that Plaintiff demonstrated substantial need for the incident report and associated documents. (Dkt. 106). In the letter, Plaintiff explained that although the Magistrate Judge did not have the complete deposition transcripts of the XPO employees before him, copies of correspondence sent to him, including correspondence dated September 13, 2019, September 17, 2019, November 1, 2019, November 6, 2019, November 8, 2019, and December 12, 2019, highlighted the hardship that Plaintiff faced both in locating and serving one XPO employee, as well as in deposing XPO witnesses. (Id. at 1). For example, Plaintiff cites to an excerpt of a deposition transcript of XPO employee Lewis Hartman which was attached to the November 6, 2019 letter to the Magistrate Judge, which revealed that the witnesses’ "clarity of ... memory regarding the aftermath of the incident and on the ground observations was diminished." (Id. at 1; see also Dkt. 106-4 at 8-15). Plaintiff asserts that "the correspondence, excerpted transcript, and conversations with the Court coupled with the Court's in camera review was sufficient to establish plaintiff's substantial need and undue hardship." (Dkt. 106 at 2). Plaintiff also points to her argument that DuPont's counsel was in possession of the report, which not only constituted waiver but also "creates an obvious unfairness," and that "such a circumstance constitutes an undue hardship." (Id. ).
The letter is actually dated September 13, 2018, but that appears to be a typographical error.
Plaintiff further contends that the parties had discussions with the Magistrate Judge on the facts relevant to its showing of substantial need. (See, e.g. , Dkt. 106 at 2). Plaintiff has provided the transcripts of those proceedings (Dkt. 112; Dkt. 113; Dkt. 114; Dkt. 115), which the Court has reviewed. At least some of the facts relevant to the question of substantial need were discussed, such as Plaintiff's inability to serve a former XPO employee (Dkt. 112 at 4), Lewis Hartman's testimony (Dkt. 114 at 6), and the argument that DuPont allegedly possessed the incident report (Dkt. 114 at 12-17; Dkt. 115 at 5-9, 14-15). While it does not appear that there was extensive argument as to the issue of substantial need in those transcripts, Plaintiff did raise her substantial need argument in her sur-reply brief submitted to the Magistrate Judge. (See, e.g. , Dkt. 46 at 2 ("given the contemporaneity of XPO's investigation, and its access to multiple sources and materials we may never be aware of, Plaintiff Klosin has a substantial need for the in camera documents to prepare its case and cannot obtain their substantial equivalent by other means")).
While the issue could have been more clearly developed, given the lenient standard of review, the Court finds that the Magistrate Judge did not commit clear error in concluding that Plaintiff has a substantial need for at least portions of the incident report, drafts of the report, and documents reflecting content that was ultimately incorporated into these reports. Specifically, the Magistrate Judge correctly concluded that Plaintiff has a substantial need for factual information pertaining to the June 25, 2018 accident, including information XPO obtained from witnesses immediately following the accident.
In arguing that the Magistrate Judge erred by finding that Plaintiff has a substantial need for this information, XPO focuses on the Magistrate Judge's finding that the incident report reflected an investigation that began within hours of its occurrence and that the clarity of witness memory regarding the aftermath of the incident was diminished by the time Plaintiff conducted her own investigation. (See Dkt. 55 at 23). XPO argues that there is no substantial need where a party can obtain the information it seeks through other discovery devices, such as interrogatories and deposition testimony, and that Plaintiff "deposed every single witness mentioned in the Investigation Report[.]" (Id. ). There are at least two problems with this argument.
In response to XPO's argument, Plaintiff points to excerpts from depositions she took of XPO employees, which reflected that their memories were diminished. (See, e.g. , Dkt. 63-1; Dkt. 63-2; Dkt. 63-3; Dkt. 63-4; Dkt. 63-5; Dkt. 63-6; see also Dkt. 62 at 11 (describing deposition testimony of Lewis Hartman, who testified that he met with the XPO president and grief counselors after the accident, but that he did not know who the other individuals in the meeting were, and that he was "kind of out of it"); id. at 12 (describing testimony by Nicholas Spalla, who testified that he could not recall whether he met with his bosses to discuss the accident)). As explained above, although these deposition excerpts have been submitted to the Court, not all of these transcripts were before the Magistrate Judge when he issued his decisions.
First, XPO is incorrect that Plaintiff deposed every witness mentioned in the incident report. The incident report includes the names of individuals who were not deposed by Plaintiff, including Peter Lobas. This fact, coupled with that Plaintiff is limited by Federal Rule of Civil Procedure 30 to only ten depositions, weighs in favor of production of the aforementioned portions of the incident report. Second, the Magistrate Judge's further explanation as to why the incident report should be produced—that the contemporaneous impressions of individuals who observed the conditions of the shipment before and after the incident are particularly important in this case, where there were no witnesses to the incident other than the two deceased plaintiffs—is significant. That fact distinguishes this case from other cases where, despite the fading memories of witnesses, the plaintiffs can rely on their own recollection of the events giving rise to their injury. Because that is not possible given the facts of this case, the immediate recollections of witnesses have added significance. For those reasons, the portions of the incident report, drafts of the incident report, and documents reflecting content ultimately incorporated into those reports which discuss factual information relevant to the accident should be disclosed, as Plaintiff has a substantial need for that information. See Allen v. Koenigsmann , No. 19-CV-8173(LAP), 2021 WL 1541395, at *1 (S.D.N.Y. Apr. 20, 2021) (finding that medical assessments, which contained key information relating to plaintiffs’ civil rights claim for deliberate indifference, were "essential to plaintiffs’ case, and they cannot obtain it from anyplace else"); see also Vasquez , 2014 WL 6356941, at *2 ("The decision whether notes and memoranda created in connection with witness interviews constitute protected work product is highly individualized and inevitably turns on the factual particulars of the case at bar.... Moreover, a court must parse the contents of each document. If a particular document contains some factual work product and some core work product, and the requesting party demonstrates substantial need for the former, the proper course is to order disclosure of factual content—such as statements of witnesses—but permit redaction of counsels’ notations that constitute core work product." (alterations, quotations, and citations omitted)).
However, to the extent the Magistrate Judge found that Plaintiff has a substantial need for information pertaining to portions of the report discussing, among other things, corrective action and recommendations, that determination is not supported by the record. Even where a plaintiff demonstrates substantial need, the court still must "protect against disclosure of the mental impressions, conclusions, opinions, or legal theories of a party's attorney or other representative concerning the litigation." Fed. R. Civ. P. 26(b)(3)(B) ; see also Adlman , 134 F.3d at 1197 (same); In re Symbol Techs., Inc. Sec. Litig. , No. CV 05-3923 (DRH)(AKT), 2017 WL 1233842, at *7 (E.D.N.Y. Mar. 31, 2017) ("If a court orders discovery of those materials, it must protect against disclosure of the mental impressions, conclusions, opinions, or legal theories of a party's attorney or other legal representative concerning the litigation."); Schomburg , 298 F.R.D. at 143 ("Factual work product is subject to disclosure once plaintiff has demonstrated substantial need and undue hardship, but core work product is entitled to more stringent protection, protection that is ‘absolute’ or ‘near absolute.’ To obtain the core work product contained in the memorandum, plaintiffs must ... establish a highly persuasive showing of need." (quotations and citations omitted)).
Certain portions of the incident report plainly contain what can be characterized as core work product. These portions of the incident report do not include factual information, and Plaintiff has not established the "highly persuasive" basis for her need for this type of information. See In re Grand Jury Subpoena Dated Oct. 22, 2001 , 282 F.3d 156, 161 (2d Cir. 2002) (explaining that burden of showing substantial need to overcome the privilege may be greater as to opinions and strategies than as to facts); see also Allen , 2021 WL 1541395, at *2 (although plaintiff had substantial need for medical assessments, finding that plaintiffs did not have substantial need for email communications, which "relay[ed] information regarding the progress of patient reassessments conducted for the purpose of this litigation" and reasoning that plaintiffs’ access to litigation strategy should be limited, and plaintiffs still had access to underlying medical assessments).
Accordingly, the final incident report dated January 30, 2019 (PRIV000149) shall be produced in redacted format, so that Section 7, Section 8, and Section 9 are redacted from the document. Further, all prior drafts of the incident report (PRIV000248, PRIV000099-000100, PRIV000269, PRIV000352, PRIV000353, PRIV000334) shall be similarly redacted. In addition, XPO is not required to produce the following documents, which contain information incorporated into the incident report relevant to Sections 7 through 9, for which Plaintiff has not shown a substantial need: PRIV000322-000323, PRIV000117-000118, PRIV000349, PRIV000240-000241, PRIV000243-000244, PRIV000344-000345, PRIV000346-000347. However, Plaintiff is entitled to the following documents, as they contain information relevant to the factual background of the accident in question, for which Plaintiff does have a substantial need: PRIV000178-179, PRIV000014-000015, PRIV000007, PRIV000114, PRIV000005.
Although some of these documents, which are comprised of emails and attachments, are labeled "attorney/client privileged," the Court does not disagree with the Magistrate Judge's conclusion that they are not subject to the attorney-client privilege. Specifically, the Magistrate Judge explained that "many of the emails XPO asserts are privileged are merely internal communications between employees of XPO in response to the accident and investigation. Although XPO's counsel, namely Richard Valitutto or Mark Lies, are copied on many of these emails, the communications are not directly between attorney and client(s) and are not made for the purpose of obtaining or providing legal advice," and a document is not privileged simply because it was sent or received between an attorney and a client. (See Dkt. 90 at 5). The Court agrees that XPO has failed to meet its burden to show that these materials, which consist of interview notes, were made for the purpose of obtaining or providing legal advice.
D. Waiver
As explained above, those portions of the privileged documents to which Plaintiff has demonstrated substantial need must be produced to her forthwith. The issue of waiver—which was initially raised before the Magistrate Judge by Plaintiff (see Dkt. 41) but not addressed in his decisions—is not properly before the Court. To the extent Plaintiff believes she is entitled to the entirety of the incident report or any other associated documents because XPO waived any privilege, Plaintiff may pursue that argument before the Magistrate Judge. CONCLUSION
For the foregoing reasons, the Court affirms in part and reverses in part the Magistrate Judge's June 3, 2020 and December 29, 2020 discovery orders. (Dkt. 51; Dkt. 90). XPO is required to produce the documents identified herein to Plaintiff, consistent with this Decision and Order.
SO ORDERED.