Opinion
C. A. N21C-05-143 SKR CCLD
07-24-2024
SYNGENTA CROP PROTECTION, LLC, Plaintiff, v. TRAVELERS CASUALTY AND SURETY COMPANY (f/k/a Aetna Casualty and Surety Company), et. al., Defendants.
Date Submitted: June 6, 2024
REVISED ORDER
SHELDON K. RENNIE, JUDGE
On this 24th day of July, 2024, upon consideration of Moving Insurers' ("Insurers") Second Motion to Enforce the Court's February 2, 2023 Discovery Order, Plaintiff Syngenta Crop Production, LLC's ("Crop") Opposition to Insurers' Motion, their responses thereto, and the record in this case, it appears to the Court that:
The Moving Insurers consist of Certain Underwriters at Lloyd's, London which subscribed to the "LMI Excess Policies" as defined in the Second Amended Complaint in this action: Accident & Casualty Insurance Co. of Winterthur; American Centennial Insurance Co.; Atlanta International Insurance Co.; Commercial Union Assurance Co. Ltd.; General Accident Fire & Life Assurance Co. Ltd.; Government Employees Insurance Co.; Nissan Fire & Marine Insurance Co. Ltd.; BA (GI) Limited (as successor in interest to Pearl Assurance PLC); Winterthur Swiss Ins. Co.; and Yasuda Fire and Marine Insurance Co. (UK) Ltd. and Certain other London Companies named as Defendants: Aegon Insurance Company (UK) Ltd.; AFIA Insurance Co.; Agrippina Versicherung AG; Alba General Insurance Co. Ltd.; Allianz Versicherungs Aktiengesellschaft (per Mees & Zoonan), American Home Assurance Co.; Argonaut Insurance Co., Assicurazioni Generali; Assurances Generales Belges; Bishopsgate Insurance Co. Ltd., Brittany Insurance Co. Ltd.; Chiyoda Fire and Marine Insurance Co. (UK) Ltd.; Colonia Versicherung AG; Continental Insurance Co. (UK) Ltd.; Copenhagen Re; Cornhill Insurance Co. Ltd.; Dai Tokyo Insurance Company (UK) Ltd.; Delta-Lloyd Non-Life Insurance Co.; Dominion Insurance Co. Ltd.; Eisen und Stahl Ruckversicherungs Atiengesellschaft; Employers Mutual Casualty Company; Ennia Insurance Co. (UK) Ltd.; Excess Insurance Co. Ltd.; Fidelity &Casualty; General Accident Fire and Life Assurance Co. Ltd.; Gerling Global General &Reinsurance Company Ltd.; Guardian Royal Exchange Assurance Co. Ltd.; Hannover Re; Helvetia Swiss Insurance Co.; Home Insurance Co. Ltd.; Home &Overseas Insurance Co. Ltd.; Imperial Chemical Insurance Company Ltd.; Insco Ltd.; Insurance Company of North America; Iron Trades Mutual Insurance Company Ltd.; La Belgique Industrielle; La Preservatrice CIA D'Assurances; La Royale Belge I.R. SA d'Assurances; L'Abeille Paix Igard Le Assicurazioni d'Italia Societa; Legal &General Assurance Society Ltd.; L'Etoile S.A. Belge d'Assurance; London and Edinburgh General Insurance Co. Ltd.; Mutual Marine Office Incorporated; National Casualty Co. of America Ltd.; Nisshin Fire &Marine Insurance Co. Ltd.; Norwich Union Fire Insurance Society Ltd.; Phoenix Assurance; Provincial Insurance PLC; QBE Insurance (UK) Ltd.; Reaseguradora International de Venezuela Compania; Royal Insurance (UK) Ltd.; St. Katherine Insurance Co. Ltd.; Sumitomo Fire and Marine Insurance Co. Ltd.; Sun Alliance and London Insurance Group; Terra Nova Insurance Co. Ltd.; TIG Insurance Company as successor to International Surplus Lines Ins. Co., Tokio Marine &Fire Insurance Co. Ltd.; Turegum Insurance Co.; UNAT Direct; Union Atlantique D'Assurances; Unionamerica Insurance Co. Ltd.; United Insurance Co.; United States Fire Insurance Co.
D.I. 351 (hereinafter "Def.'s Second Mot.").
D.I. 350 (hereinafter "Pl.'s Opp'n").
(1) This suit concerns insurance coverage stemming from thousands of bodily injury claims related to the manufacturing and sale of the herbicide paraquat.The underlying claimants argue that their Parkinson's disease was caused by paraquat exposure. They demand coverage for their injuries from Crop, along with other companies that are not parties to this action. Crop seeks coverage from Insurers for the suits under policies placed in the London Insurance Market during the 1970s and 1980s. Crop claims that its coverage only extends to liabilities arising from the 1970s and 1980s operations of its alleged predecessors ICI United States and ICI Americas.
Def.'s Second Mot at 1-2.
Id. at 2.
Id.
Id.
Id.
(2) Throughout the pendency of the discovery phase of this case, Crop and Insurers have disagreed on what information is discoverable in light of the attorney-client privilege and work product doctrine.
Id; Pl.'s Opp'n.
(3) In April 2022, Insurers served discovery requests on Crop seeking information on the paraquat liabilities and potential coverage defenses. Crop objected to all of Insurers' discovery requests, contending that the information was privileged. Following a failed meet-and-confer, Insurers, on November 11, 2022, moved to compel production of the withheld documents.
D.I. 352 (herein "Declaration of Ronald Puhala").
Def.'s Second Mot. at 3.
Id.
(4) The Court held a hearing on February 2, 2023, where it issued an oral ruling. The Court held:
D.I. 276.
[A]ny communications between ICI and Chevron are not subject to any privilege, not subject to the settlement privilege because those two parties, for purposes of apportionment, were adversarial at that time. I should be clear about that. I just said any communications. If there were communications with regard to their joint defense of the lawsuit, that's a different thing. I'm just talking about for purposes of apportionment at the time when the parties were adversarial.
Secondly, the underlying facts - and I can't even begin to list what all would be relevant. But, for example, the time of plaintiff's exposure, what product they were exposed to, anything that would be related to the strength or the timing of a claim, anything that could be related to whether that plaintiff's particular injury would be covered, those underlying facts are not subject to privilege no matter where they are contained.
So if the only place they are or the best place they are is in certain summaries or reports which were gathered by Kirkland &Ellis, particularly at the time that the law firm was acting as a consultant, those must be produced. Obviously, they need to be - other material can be redacted. But the parties, I suggest, need to meet and confer. And if the best or the only place in which the underlying facts are available is in those reports, that's going to have to be produced in redacted form.
. . .
So, any underlying facts, an analysis as to why a certain percentage might be appropriate, those are going to be discoverable and not covered by the attorney/client privilege because I think it is inevitable that that will be placed at issue.
Now, what is not discoverable at this point, unless it is directly placed at issue, is any portion of these documents in which Kirkland &Ellis says here are all the facts. Now, here's what we advise you to do. I don't know that it's going to be that easy to parse it out, but actual advice based upon not just facts but on an analysis of the facts is not discoverable. That is attorney/client privilege.
[F]or now, nothing that is strategic advice or legal advice as I've narrowly defined it needs to be produced. But that does not exclude analysis of facts. It doesn't have to just be pure facts, but an analysis of the facts.
Pl.'s Opp'n, Ex. 4.
(5) On June 30, 2023, Insurers filed its first Motion to Enforce. In the hearing on the motion held on October 11, 2023, the parties limited the scope of their argument to whether internal files held by defense counsel Kirkland &Ellis ("Kirkland") must be produced. The Court ruled that the Kirkland files must be searched, and directed the parties to meet and confer as to the scope. On December 11, 2023, Crop produced some of defense counsel's communications. Of the 3,900 documents identified, Crop removed 1,185 documents, citing privilege. Another 1,035 documents were redacted. Additionally, in "production 19" there were 2,341 documents that Crop did not identify as counsel records. Of those 2,341 documents, 463 had been withheld for privilege and 569 were redacted.
D.I. 291.
Pl.'s Opp'n.
Pl.'s Opp'n.
Def.'s Second Mot at 4.
Id. at 5.
Id. at 5-6.
Id.
Id.
(6) In a meet-and-confer following the October 11, 2023 ruling, the parties agreed that-because of the volume of documents-Insurers would propose search terms for the remaining documents. However, on March 11, 2024, Insurers informed Crop that they could not fulfill their search terms agreement, citing redactions and privilege. On April 10, 2024, Insurers submitted the instant Motion, arguing that the Court's February Order provided a very narrow exclusion for privileged material and everything else was to be propounded. Crop responded on May 10, 2024, arguing that it complied with the Court's February Order and that the "at issue" exception does not require it to produce all privileged documents.
Id. at 6.
Id.
Id.
Pl.'s Opp'n.
(7) The issue before the Court is how far the "at issue" exception extends. While the parties' diametrically opposed interpretations fall in ditches on either side of the proverbial privilege road, the Court elects to drive on solid ground down the middle of the road.
(8) The existence of an "at issue" exception does not automatically eradicate the attorney-client privilege nor the work product doctrine. The application of Insurers' interpretation of the Court's Order would essentially eliminate the privilege by concluding that a party puts every communication-except for those unheeded- at issue simply by filing a liability case. This is incorrect.
Consistent with the Court's February 2, 2023 ruling, for purposes of this Order, the differentiation between the attorney-client privilege and the work product doctrine does not change the analysis.
Def.'s Second Mot.
(9) Generally, the "attorney-client privilege [] protects communications between a client and an attorney acting in his professional capacity . . ." The privilege can be waived when a party places the privileged communication "at issue" in the litigation. The "at issue" exception is "based on principles of waiver and fairness intended to ensure the party holding the privilege cannot use it both offensively and defensively." There are two instances where a party will put the otherwise privileged communications "at issue." The first is by "injecting the attorney-client communication into the litigation" and the second is by "injecting an issue into the litigation, the truthful resolution of which requires an examination of attorney-client communications." The "at issue" exception turns on whether the party seeking the privileged communications is disadvantaged because it would otherwise be unable to obtain the information from an alternate source. Delaware courts have historically "rejected the idea that a party waives the attorney-client privilege" simply by filing suit. However, the Court must balance that rejection with the understanding that in order to build an appropriate legal defense, Insurers must have access to the underlying facts of the paraquat litigation.
Moyer v. Moyer, 602 A.2d 68, 72 (Del. 1992).
Tackett v. State Farm Fire & Ca. Ins. Co., 653 A.2d 254 (Del. 1995).
Hoechst Celanese Corp. v. Natl. Union Fire Ins. Co. of Pittsburgh, 623 A.2d 1118, 1125 (Del. Super. 1992).
Fitzgerald v. Cantor, 1999 WL 64480, at *2 (Del. Ch. Jan. 28, 1999).
Id.
Princeton Ins. Co. v. Vergano, 883 A.2d 44, 60 (Del. Ch. 2005).
Playtex FP, Inc. v. Columbia Cas. Co., 1993 WL 83322, at *3 (Del. Super. Mar. 4, 1993).
(10) As a preliminary matter, the parties agree that the facts of the underlying litigation are discoverable. The parties disagree on what communications beyond the underlying facts are admissible.
(11) The February Order was clear that any communications between the Syngenta related entities and Chevron for purposes of apportionment are not subject to any privilege. Those communications are only privileged when the Syngenta related entities and Chevron were working on their joint defense. So, Crop's redaction of the draft expert stipulation when the Syngenta related entities and Chevron were working together as joint defendants is proper.
Pl.'s Opp'n, Ex. 4.
(12) The parties dispute the legal analysis portion of the Court's February Order. Per the Court's February Order, Crop is required to turn over all documents with legal analysis pertaining to apportionment. This does not include pure legal advice based upon legal analyses, regardless of whether the legal advice was used by Crop. For example, in the Kirkland & Ellis LLP Memorandum dated April 16, 2022, there is a section titled "MDL/California Comparison." Within that section, what would be discoverable would be any comparison between the MDL and California cases while any legal advice such as "so we recommend taking this course of action" would be privileged. The former would be legal analysis of the underlying cases while the latter would be privileged legal advice.
Def.'s Second Mot, Ex. E.
(13) In addition, to Crop complying with the above direction, Crop is also ordered to provide Insurers with a privilege log with sufficient detail to ascertain the basis for the asserted privilege.
IT IS SO ORDERED.