Opinion
No. X08 CV 02 0191697 S
September 7, 2005
MEMORANDUM OF DECISION RE STEADFAST'S MOTION TO COMPEL
In this insurance coverage litigation the plaintiff, Steadfast Insurance Company (Steadfast) moves to compel the production of documents withheld by The Purdue Frederick Company and other defendants (collectively Purdue) on the ground they are protected from disclosure by the attorney-client privilege or the attorney work product doctrine. The major bases for Steadfast's motion are (1) that as Purdue's primary insurer for numerous lawsuits brought against Purdue in connection with its manufacture, distribution and sale of its pharmaceutical product, OxyContin (OxyContin litigations), Steadfast is owed a duty by Purdue to cooperate with Steadfast and provide it information about the lawsuits, and that while the documents withheld by Purdue may be privileged as to third parties they are not so privileged with respect to Steadfast; (2) that Purdue may not assert the joint-defense aspect of the attorney-client privilege with respect to documents and information Purdue shared with Abbott Laboratories (Abbott), and (3) that Purdue has waived the privilege by putting some of the documents "at issue" in this case.
There is no doubt that the insurance policy and binder at issue requires Purdue to "cooperate" with Steadfast in the defense and handling of claims. However, Purdue asserts that because of the adversarial relationship between insured and insurer embodied in the present coverage dispute the cooperation clause in the policy cannot overcome the attorney-client privilege. In Metropolitan Life Ins. Co. v. Aetna Casualty Surety Co., 249 Conn. 36 (1999) the Connecticut Supreme Court held that certain cooperation clauses in insurance policies did not justify disclosure of information subject to the attorney-client privilege. In that case, the defendant insurers failed to associate themselves with the insured in the defense of asbestos litigation by denying coverage or reserving their rights.
This court concludes there is no meaningful difference from the situation in Metropolitan Life and the facts in this case. Steadfast argues that, rather than failing to associate itself with Purdue, it has tried in vain to exercise its right to defend Purdue. Purdue responds that it has spent several hundreds of millions of dollars in defense of the OxyContin litigations with only a minuscule portion of that being reimbursed by Steadfast, and that Steadfast has reserved its rights as to significant portions of insurance coverage. With due regard to the above contentions, no one can doubt that there have been serious disputes about insurance coverage in the OxyContin litigations almost since their inception, and the positions of Steadfast and Purdue have been highly adversarial mirroring the positions of the parties in Metropolitan Life. Based on the reasoning and holding of that case, this court finds that the cooperation clause is not a basis for overcoming the attorney-client privilege.
Steadfast contends that documents withheld by Purdue and exchanged between Purdue and Abbott should be produced pursuant to the cooperation clause and because certain of those documents reflect circumstances in which Purdue and Abbott have purportedly adverse interests. Purdue has asserted that the documents are protected by the joint defense privilege which is an extension of the attorney-client privilege that protects communications between parties and the parties' attorney when the parties have decided upon and undertaken a joint defense strategy in litigation.
For the reasons stated above, the cooperation clause is not a basis for overcoming the privilege. While Steadfast correctly points out that not every interaction between Purdue and Abbott was related to a joint defense strategy in connection with the OxyContin litigation, a review of Purdue's privilege logs convinces the court that the documents withheld do relate to the joint defense and are not discoverable.
The "at issue" exception to, or implied waiver of the attorney-client privilege argued by Steadfast is recognized by Connecticut, but "only when the contents of the legal advice is integral to the outcome of the legal claims of the action." Metropolitan Life, supra, 249 Conn. 52-53. The relevance of attorney-client communications to the issues is not sufficient to place them at issue; neither is an admission that one relied on legal advice in making a decision. Id., 54. Steadfast argues that Purdue cannot contend that its litigation strategy was reasonable and necessary without revealing the privileged information regarding case evaluations and attorneys' advice relevant to that strategy. The court concludes that this argument must be rejected based on the language of the Connecticut Supreme Court.
"If admitting that one relied on legal advice in making a legal decision put the communications relating to the advice at issue, such advice would be at issue whenever the legal decision was litigated. If that were true, the at issue doctrine would severely erode the attorney-client privilege and undermine the public policy considerations upon which it is based."
Metropolitan Life, supra, 249 Conn. 54.
The motion to compel is denied in all respects.
TAGGART D. ADAMS
SUPERIOR COURT JUDGE