II. ARGUMENT The work product doctrine is "an intensely practical one, grounded in the realities of litigation in our adversary system." United States'. Nobles 422 U.S. 225, 238 (1975).. Relying on Sporck Peil, 759 F.2d 312 (3d Cir. 1985), and its progeny, Plaintiff contends that the compilation of non-privileged documents by attorneys is "opinion work product," and seemingly asserts that the documents themselves, and not just the compilation, can be kept from the defense. These sweeping claims, belied as they are by the record in this case, should be rejected. A. The Supposedly Unassailable Sporck Plaintiff's Memorandum makes it appear as though the principle announced in Sporck has been accepted as gospel throughout the federal court system. Nothing could be further from the truth. Not only was Sporck a 2-1 decision with a strong dissent, later cases and commentators have criticized its expansion of the work product doctrine. In Sporck, a civil securities fraud case, the attorney for the plaintiff deposed a defendant and requested the "identification and production" of documents that the defendant's attorney had used to prepare the defendant for the deposition. 759 F.2d at 313-14. The documents in question, which were not themselves protected from disclosure, had "previously been produced" to the plaintiff. Ad. at 314-15. The defendant's attorney refused to comply with the request, and sought mandamus relief on work product grounds when the district court ordered disclosure and production. A divided panel of the Third Circuit granted the petition, holding that the district court EFTA00177847

"should not have ordered the identification of the documents selected by [defense] counsel." Id.: at 315 (emphasis added). See also id. (agreeing with the defendant that "the identification of the documents as a group must be prevented to protect defense counsel's work product") (emphasis added). The majority ruled that the "selection and compilation of documents by counsel in this case in preparation for pretrial discovery falls within the highly-protected category of opinion work product," explaining that without such work product protection an attorney might "forego[ ] a sifting of the documents." Id, at 316, 317. Judge Seitz dissented. He was "convinced that [the majority's] ruling [was] an impermissible expansion of the work product doctrine at the expense of legitimate discovery." II at 319. He pointed out that the documents in question were not themselves covered by the doctrine and "had already been produced by the defendants." a Attacking the majority's belief that the litigation strategy of the defendant's attorney would be revealed by identification of the documents used to prepare for the deposition, Judge Seitz explained: The problem with [this] theory is that it assumes that one can extrapolate backwards from the results of a selection process to determine the reason a document was selected for review by the deponent. There are many reasons for showing a document or selected portions of a document to a witness. The most that can be said from the fact that a witness looked at a document is that someone thought that the document, or some portion of the EFTA00177848

document, might be useful for the preparation of the witness for his deposition. This is a far cry from the disclosure of the lawyer's opinion work product. Id. at 319. See also id, at 320 ("Certainly an attorney cannot cloak a document under the mantle of work product by simply reviewing it."). Finally, Judge Seitz criticized the majority's characterization of the compilation as opinion work product, saying that at most it would be fact work product. Sporck has not, contrary to Plaintiffs implication, been universally accepted.' In In re Search Warrant for Law Offices, 153 F.R.D. 55 (S.D.N.Y. 1994), a case presenting facts very similar to those here, a district court in New York refused to follow Sporck. The government in that case executed a search warrant at a law firm's offices to obtain evidence concerning one of the firm's corporate clients and its two principals. The materials taken during the search were provided to a taint prosecutor who was not involved in the underlying grand jury investigation. Isis at 56-57. The firm and its client filed a motion for return of the documents on work product and attorney-client privilege grounds. In support of the motion, one of the firm's attorney's submitted an affidavit (which the district court accepted as true) explaining that 14 of the cartons taken had been "'segregated by [him] as part of a confidential, attorney-directed investigation into Even one of the appellate decisions adopting Sporck involved a divided panel. See In re Allen, 106 F.3d 582 (4th Cir. 1997) (2-1 decision). EFTA00177849

possible illegal activity within and against [the corporate client]." a at 57. The investigation was begun "in preparation for litigation, including possible civil claims against .. . former employees and contractors of the corporate client, as well as defending against governmental claims and any federal criminal investigation of the corporate client." a The district court refined to extend the work product doctrine to the compilation of non-privileged materials: This court declines to extend the concept of work product so far as to protect otherwise non-privileged corporate documents, simply because the lawyer has separated and arranged them in a manner convenient to his intended study for one or more legal problems and which reflects his analysis and thoughts concerning the matter which he was investigating. The argument on its face is slightly frivolous because it assumes that this lawyer investigating these documents could detect or perceive something in them or perceived the need to examine them, which was not readily apparent to a skilled special agent. Id, at 58. Moreover, the court explained, "the policy consequences of permitting a client to insulate incriminating corporate documents which otherwise would have to be produced, by handing them over to an attorney who arranges them in some logical or illogical fashion, is simply too drastic to accept." a The court therefore ordered that documents which were not themselves privileged or protected be "turned over to the [prosecutor] in charge of the prosecution of the matter." a Under the holding of Law Offices, the Court in this case should order that the documents in question be turned over to the defense. Like all other privileges against forced disclosure, the work product doctrine should not be "expansively construed" because it is in "derogation of the search for truth." United States I, Nixon, 418 U.S. EFTA00177850

683, 710 (1974). Law Offices is not the only case to cast doubt on Sporck. See generally P. Grady, Discovery of Computer System Stored Documents and Computer Based Litigation Support Systems: Why Give Up More Than Necessary, 14 John Marshall J. of Comp. & Inf. Law 523, 551 (1996) (noting that "other courts have not accepted the Third Circuit's position" in Sporck). Even those courts which have found some basis for agreement with Sporck have rejected its broad expansion of the work product doctrine. For example, the First Circuit, in a complex case involving a hotel fire, permitted the pretrial disclosure of lists identifying exhibits to be used in depositions. In re San Juan Dupont Plaza Hotel Fire Litigation 859 F.2d 1007, 1017 (1st Cir. 1988). Although the panel held that the lists constituted fact work product, it criticized Sporck and refused to characterize the lists as opinion work product: "Th[e] [Sporck] reasoning, we suggest, is flawed because it assumes that the revelatory nature of the sought-after information is, in itself, sufficient to cloak the information with the heightened protection of opinion work product. That is simply not the case; much depends on whether the fruits of the screening would soon be revealed in any event." Id. at 1018? Thus, at most, the compilation of documents by Plaintiff's counsel is fact work product which can be obtained by showing substantial need and undue hardship. Ida at 1015. 2 Several district courts have opted to follow Dupont Plaza instead of Sporck. Sec, Igs, I. astano I. American Tobacco Co, 896 F.Supp. 590, 596 (E.D. La. 1995); Resolution Trust Corp. Heiserman, 151 F.R.D. 367,375 (D. Colo. 1993); Bohannon'. Honda Motor Co„ 127 F.R.D. 536, 539 (D. Kan. 1989); In re Shell Oil Refinery, 125 F.R.D. 132, 133-34 (E.D. La. 1989). EFTA00177851

Similarly, in Gould Inc,. Mitsui Mining & Smelting Co„ 825 F.2d 676, 680 (2d Cir. 1987), the Second Circuit declined to embrace Sporck, explaining that the application of the Sporck principle "depends on the existence of a real rather than speculative concern that the thought processes of . . . counsel in relation to pending or anticipated litigation would be exposed." In this case, given the number of documents involved, it is difficult to see how there can be a "real" danger that the thought processes of Plaintiffs attorneys will be revealed. See also In re Joint Eastern & Southern District Asbestos Litigation, 119 F.R.D. 4, 5-6 (E.D.N.Y. & S.D.N.Y. 1988) (book of photographs, compiled by plaintiff's attorney, showing various forms of asbestos to which plaintiff had been exposed, was discoverable as a fact compilation because it did not reveal attorney's strategy); American Floral Services, Inc.'. Florists' Transworld Delivery Ass'n, 107 F.R.D. 258, 260-61 (N.D. III. 1985) (plaintiff required to reveal identity of two of defendant's employees whom it had interviewed and who apparently had knowledge concerning plaintiff's claim). a. In re Grand July Subpoenas, 959 F.2d 1158, 1167 (2d Cir. 1992) ("With the advent of inexpensive photocopying, it seems likely that most sets of copied documents maintained by law firms will be sufficiently voluminous to minimize disclosure of the attorney's identification of some occasional wheat among the chaff."); In re Shell Oil, 125 F.R.D. at 134 ("it is highly unlikely that Shell will be able to discern the PLC's `theory of the case' or thought processes simply by knowing which 65,000 out of 660,000 documents have been selected for copying"). Criticism of Sporck has not been limited to the judiciary. Commentators have also EFTA00177852

expressed their disagreement with the case. agg K. Waits, Opinion Work Product: A Critical Analysis of Current Law and a New Analytical Framework, 73 Oregon L. Rev. 385, 450 (1994) ("Sporck is wrongly decided[.] Contrary to the assertions in Sporck, . . . the adversary system is not threatened by the revelation of materials that only indirectly reveal an attorney's thinking."); L. Orland, Observations on the Work Product Rule, 29 Gonzaga L. Rev. 281, 298 (1993-94) ("No opinion has been found that explains why the [Sporck] selection and compilation exception . . . should be carved out for preferential treatment."). For the reasons set forth in Judge Seitz's dissent and the decision in Law Offices, this Court should reject Sporck as an unwarranted expansion of the work product doctrine. After all, "pre-existing documents which could have been obtained by court process from the client when he was in possession may also be obtained from the attorney by similar process following transfer by the client in order to obtain more informed legal advice." Fisher,. United States, 425 U.S. 391, 403-04 (1976) (addressing attorney-client privilege). Accord Shelton American Motors Corp, 805 F.2d 1323, 1328 (8th Cir. 1986) ("AMC does not contend that the documents themselves, prepared by other departments for the purpose of analyzing AMC vehicles, are protected as work product simply because those documents now may be in the possession of AMC's litigation department."). B. The Limitations on $porck Sporck does not, in any event, go as far as Plaintiff needs it to in order to shield the EFTA00177853

documents at issue from the taint team. Although Plaintiff says that Sumli controls, it fails to acknowledge significant factual differences between this matter and Sporck. First, in Spsicic, unlike here, the party seeking the list of certain documents already had the documents themselves in its possession because they had previously been produced. 759 F.2d at 314, 319. Indeed, the sine qua non of Sporck and its progeny is the protection of the list or index of the selected documents because the documents themselves are already in the hands of the opposition or can be obtained by normal legal channels. See Waits, Opinion Work Product, 73 Oregon L. Rev. at 450 n. 229 ("by definition in document selection cases like Sporck the opponent already possesses the documents").3 When the Court reviews the documents in camera, it will see that they include original documents which must be turned over to the government. ,Se Law Offices, 153 F.R.D. at 59 (lawyer cannot secure work product protection by highlighting an original corporate document that is not otherwise privileged). Thus, at least with respect to those original documents, the defendant does not have possession of them. The necessary predicate does not exist, and Sporck is not triggered. See Gould, 825 F.2d at 680 ("the equities may not favor the application of the Sporck exception if the files from which the documents had been culled . . . were not otherwise available . . . or were beyond 3 Plaintiffs own cases recognize that the compiled documents must be in the possession of, or available to, the opposing party. age, a, In re Allen, 106 F.3d at 608 (adoption of Sporck "does nat protect [the] personnel records from disclosure, just [the attorney's] selection and arrangement of them"); James Julian. Inc. I. Raytheon Co., 93 F.R.D. 138, 144 (D. Del. 1982) ("Julian does not object to the defendants obtaining the documents contained in the binder[.]"). EFTA00177854

reasonable access"). And, as noted above, the compilation of documents is at most fact work product which can be obtained upon a showing of substantial need and undue hardship. The defendant can and will make that showing at the evidentiary hearing if and when Plaintiff meets its initial work product burden. C. Plaintiff's Burden and the Need for an Evidentiary Hearing Plaintiff, as the party asserting the protection of the work product doctrine, has the burden of establishing its elements. Sgg, g4, Hodges. Grant & Kaufmann I. U.S. Government. Dept. of the Treasury, 768 F.2d 719, 721 (5th Cir. 1985). Plaintiff has provided a general privilege log and an affidavit, but those submissions, under the circumstances, are insufficient to establish the applicability of the work product doctrine. The log describes only broad categories of documents, and the supporting affidavit completely fails to explain which attorneys compiled which documents. For reasons explained below, those particular facts are critical to the work product analysis in this case. Without those facts, the defendant cannot intelligently determine which of Plaintiff's claims have merit. "'Without identification of the documents, the party against whom the privilege is claimed is completely unable to challenge the validity of th[e] claim." Smith Logansport Community School Corp., 139 F.R.D. 637, 648 (N.D. Ind. 1991) (citation omitted). Plaintiff simply has not carried its burden of establishing its entitlement to work product protection. a. Rabushka I. Crane Co., 122 F.3d 559, 565 (8th Cir. 1997) ("Crane met its burden of providing a factual basis for asserting the [attorney-client and work product] privileges when it produced a detailed privilege log EFTA00177855

stating the basis of the claim privilege for each document in question, together with an accompanying explanatory affidavit of its general counsel.") (emphasis added). The Court "must require [Plaintiff] to assert [work product] with a document-by- document explanation as to why the [doctrine] shields the document from the [warrant's] reach. The [Court] must then determine the validity of each assertion -- either by conducting a hearing or inspecting the documents in camera." In re Grand Jury Subpoena, 831 F.2d 225, 228 (11th Cir. 1987) (attorney-client privilege case). Whatever process the Court chooses, it must permit the defendant to participate and meaningfully litigate the applicability of the work product doctrine. In this vein, we point out that, even if Sporck is followed, Plaintiff's work product theory flounders with respect to at least certain of the categories of documents set forth in the privilege log. Contrary to Plaintiff's suggestion, even the most generous interpretations of the work product doctrine do not protect the selection of materials by a client; the doctrine protects attorney work product. age, Bloss I. Ford Motor Co. 126 A.D.2d 804, 805, 510 N.Y.S.2d 304 (N.Y.App.Div. 1987) (documents which could have been prepared by a layman not entitled to work product protection). In any event, Plaintiff has no standing to assert any work product protection on behalf of an unidentified third party or his/her unidentified counsel. See, e.g., Bohannon 127 F.R.D. at 53940 ("work product status does not apply to documents submitted to or received from a third party"). The fact that computer printouts -- routine printouts available from the Plaintiff's EFTA00177856

D. Plaintiff's Failure to Establish Confidentiality and Lack of Waiver "[W]hen an attorney freely and voluntarily discloses the contents of otherwise protected work product to someone with interests adverse to his or those of his client, knowingly increasing the possibility that an opponent will obtain and use the material, he may be deemed to have waived work product protection." In re Doe, 662 F.2d 1073, 1081 (4th Cir. 1981). Under the circumstances, any claim of privilege or work product cannot be accepted without further evidentiary substantiation. See United States'. Aramony, 88 F.3d 1369, 1392 (4th Cir. 1996) (where the allegations against one party could not subject another to civil or criminal liability, joint defense privilege is inapplicable), cert. denied, 117 S. Ct. 1842 (1997); Sheet Metal Workers International Association'. Sweeney, 29 F.3d 120, 124-25 (4th Cir. 1994) (any privilege arising from engaging in joint defense requires, as a threshold matter, a legitimate common interest about a legal matter); km Bevil!. Bresler & Schulman Asset Management Corp., 805 F.2d 120, 126 (3d Cir. 1986) (proponent bears burden of producing evidence establishing privilege). If Plaintiff is going to use the purported joint defense agreement as a weapon in its arsenal, it must be produced to the defendant so that its breadth and applicability can be fairly litigated. EFTA00177857

database that are routinely produced in the course of operating Plaintiff's business -- were made available to and used by attorneys does not protect them from disclosure or turn them into work product. See Santiago i Miles, 121 F.R.D. 636, 642 (W.D.N.Y. 1988) (no work product protection where, although computer reports may have been prepared with pending litigation in mind, the primary motivation behind the creation of such reports was for use in the normal course of business); Colorado ex rel. Woodard Schmidt-Tiago Construction Co„ 108 F.R.D. 731, 734-35 (D. Cob. 1985) (absent additional evidence, no work product protection for readouts from computer program established for use in regular course of business); Fauteck Montgomery Ward & Co., 91 F.R.D. 393, 398-99 (N.D. Ill. 1980) (ordering disclosure of personnel records from computer database where counsel merely raised conclusory claim that the database formulation "entail[ed] numerous strategic legal decisions"). Plaintiff must of course meet its burden with respect to each of the categories of documents it claims are work product. Yet several of the categories it claims are work product have been denied such status. This is the case with training and attendance sheets, see. e.g., Burton I R.J. Reynolds Tobacco Co„ 170 F.R.D. 481, 486 (D.Kan. 1997) (document evidencing attendance of two company employees at meeting not work product under Kansas law), and with Congressional subcommittee testimony, see. e.g„ LaMorte I. Mansfield, 438 F.2d 448, 451-52 (2d Cir. 1971) (any privilege which may exist for testimony given at non-public SEC hearing belongs to SEC, and argument that transcripts were work product was meritless). EFTA00177858

EL—AD RESIDENCES AT MIRAMAR CONDO. i MT. HAWLEY 1257 Clina 716 PSupp.2d 1257 (S.D.Fla. 2010) seeks declaratory relief pursuant to state or federal law. 8. The Clerk is directed to send a copy of this Amended Order to the Clerk of the Judicial Panel on Multidistrict Litigation. 9. The Final Judgment previously is- sued in the Aurelius Action, see Case No.: 10-CV-20236, [DE 531 (S.D. Fla. May 28, 2010), is hereby VA- CATED. EL-AD RESIDENCES AT MIRAMAR CONDOMINIUM ASSOCIATION, INC., a Florida not-for-profit corpora- tion, Plaintiff, MT. HAWLEY INSURANCE COMPA- NY, a foreign corporation, and West- chester Surplus Lines Insurance Company, a foreign corporation, De- fendants. Case No. 09-60723-CIV. United States District Court, S.D. Florida. June 2, 2010. Background: Condominium association brought action against insurers, stemming from coverage dispute over hurricane dam- age. Association's former attorneys moved to intervene and for ancillary proceeding. Holdings: The District Court, Chris McA- liley, United States Magistrate Judge, held that: (1) intervention as of right was warranted, and (2) ancillary proceeding to sanction former co-counsel was not warranted. Motions granted in part and denied in Part 1. Federal Civil Procedure 4=331 Condominium association's former at- torneys had right to intervene in associa- tion's present action against insurers, stemming from coverage dispute over hurricane damage, for limited purpose of protecting privileged communications; dis- closure of attorneys' privileged communi- cations with former co-counsel would have harmed attorneys in ongoing litigation. Fed.Rules Civ.Proc.Rule 24(a), 28 U.S.C.App.(2006 Ed.). 2. Federal Courts a=21 Ancillary proceeding to sanction for- mer attorneys' former co-counsel was not warranted in action brought by condomini- um association against insurers, stemming from coverage dispute over hurricane dam- age, since court already had all necessary claims before it to resolve sanctioning is- sue, and had ability to manage its proceed- ings, vindicate its authority, and effectuate its decrees without extending its jurisdic- tion. Keith Jeffrey Lambdin, Katzman Gar- finkel Rosenbaum, John David Mallah, Maitland, FL, for Plaintiff. Bradley Ryan Weiss, Benson Mucci & Associates LLP, Thomas E. Tookey, Coral Springs, FL, Brian E. Sims, Michael D. Prough, William C. Morison, Morison Hol- den Derewetzky & Prough LLP, Walnut Creek, CA, Cortland C. Putbrese, Morison Holden Derewetzky & Prough, LLP, Rich- mond, VA, Daniel Howard Coultoff, La- tham, Shuker, Barker, Eden & Beaudine, EFTA00177859

1258 716 FEDERAL SUPPLEMENT, 2d SERIES LLP, Orlando, FL, Scott Michael Janow- itz, William S. Berk, Melissa M. Sims, Berk Merchant & Sims PLC, Coral Ga- bles, FL, for Defendants. OMNIBUS ORDER CHRIS McALILEY, United States Magistrate Judge. Pending before the Court are the follow- ing related motions: (1) Request for Judi- cial Inquiry [DE 103]; (2) Motion for Pro- tective Order [DE 122]; (3) Motion to Intervene [DE 126]; (4) Motion to Con- vene Ancillary Proceedings [DE 180]; and (6) Motion for Hearing on Motion to Con- vene Ancillary Proceedings [DE 132].' The Honorable Adalberto Jordan has re- ferred the motions to me for resolution, and for the reasons stated below the Mo- tion to Intervene is granted, and the other motions are denied. I. BACKGROUND This and a related ease arise from an insurance dispute over damage allegedly caused by Hurricane Wilma to two condo- minium complexes. The Plaintiff in this case, El—Ad Residences at Miramar Con- dominium Association ("Residences"), re- tained the law firm of Katzman Garfinkel Rosenbaum LLP ("KGR") to represent it in its claim against its primary property casualty insurer, Mt. Hawley Insurance Company ("Mt. Hawley") and its excess insurer, Westchester Surplus Lines Insur- ance Company ("Westchester') (collective- ly, "Defendants"). The other condomini- um complex, El—Ad Enclave at Miramar I. Defendant, Westchester Surplus Lines In- surance Company, filed a Motion for Ex- tension of Time to Respond to Motion to Convene Ancillary Proceedings [DE 146]. Because the Court denies the Motion to Convene Ancillary Proceedings is denied, Westchester's Motion is moot. Condominium Association ("Enclave"), also retained KGR to bring suit against Mt. Hawley and a different excess insurer, General Star Indemnity Company.' In March of this year, while this litigation was on-going, the law firm of KGR broke up, with some of its attorneys, led by Daniel S. Rosenbaum, forming the firm Rosenbaum Mollengarden Janssen & Sir- cusa ("RMJS"), and others, principally Alan Garfinkel and Leigh Katzman, form- ing Katzman Garfinkel & Berger ("KGB"). The break-up of KGR has been acrimoni- ous and has led to litigation between the former law partners. The motions now before this Court arise, in large measure, from heated disputes between Rosenbaum on the one hand, and Garfinkel and Katz- man on the other. Immediately following the breakup of KGR, Rosenbaum's law firm, RMJS, en- tered appearances on behalf of both Resi- dences and Enclave. Thereafter, on April 8, 2010, RMJS filed a Request for Judicial Inquiry in this, the Residences case' that can be summarized as follows. Before the formation of KGR, Garfinkel had a law firm called the Garfinkel Trial Group ("GTG"), which hired a consulting firm, Hunter R Contracting LLC ("Hunter R") and TSSA Storm Safe Inc. ("TSSA"), to perform insurance estimates. Kenneth Remain was a member of Hunter R. After several years of this consulting relation- ship, GTG terminated Hunter R and TSSA, which led to litigation between them over monies owed. These disputes spilled over into a number of ongoing law- 2. The "Enclave case" is filed with this Court as Case No. 09-60726-CIV-30ltDAN/MCALI- LEY. 3. The motion is fully titled Request for Judi- cial Inquiry Into Perjury, and Potential Subor- nation of Perjury and Witness Tampering. IDE 103]. EFTA00177860

EL-AD RESIDENCES AT MIRAMAR CONDOS. MT. HAWLEY 1259 CIloas716 F.Supp.2d 1257 (S.D.FIa. 2010) suits filed in state and federal courts, be- tween condominium associations repre- sented by GTG and or the consultants, and the various insurers they had sued. Ro- main was deposed in a number of those lawsuits and testified that Garfinkel, GTG and the consultants had engaged in a scheme to generate falsely high insurance claims, that Garfinkel had received kick- backs from the consultants, and that Gar- finkel, through others, had an improper ownership interest in Hunter R. At a March 30, 2010 deposition taken in several cases, including this case and the Enclave case, Romain recanted these claims of wrongdoing. RMJS asserts that Romain's conflicting sworn testimony demonstrates that Romain has committed perjury, either at his earlier depositions, or at the March 30th deposition, and in its Request RMJS asks this Court to conduct an inquiry into this perjury as well as possible fraud and unethical conduct by Romain, Garfinkel, and possibly others. Several days after RMJS filed the Re- quest for Judicial Inquiry, Residences again changed counsel: Garfinkel's and Katzman's new firm, KGB, filed a notice of appearance on Residence's behalf, and Rosenbaum's firm, RMJS, withdrew as counsel. RMJS continues to represent Enclave, in Case No. 09-60726-CIV-JOR- DAN. The Motion for Judicial Inquiry was filed a few days before a discovery confer- ence I had scheduled for April 16, 2010. 1 took the opportunity, at the start of that hearing, to ask Rosenbaum to answer some questions I had about his Request 4. The transcript of that discovery conference has been filed at DE 119. 5. Rosenbaum Included the following informa- tion he gave the Court. At a time when difficulties had arisen between Rosenbaum and his partners Garfinkel and Katzman, and they were discussing disassociating from one another, Katzman allegedly said: "'You don't for Judicial Inquiry, which he did." Rosenbaum basically restated what is sum- marized above, and was more clear about his concern that his former partners may have paid Romain to change his testimo- ny.' Rosenbaum also disclosed that he had brought his concerns to the U.S. At- torneys Office. As for the inquiry he wants this Court to undertake, Rosenbaum suggested that the Court hold hearings and take testimony from everyone in- volved: the various attorneys and consul- tants and possibly the Plaintiffs them- selves. He believes that a fraud has been worked upon this and many courts and that this Court should look beyond the issues in this case and inquire into improp- er conduct in similar cases filed in other divisions of this Court and in various state courts. In the end, Rosenbaum would have this Court determine whether Gar- finkel and Katzman and the consultants engaged in improper conduct before this or other courts, although he was not clear what remedies this Court might order. Having heard from Rosenbaum, I asked the other parties to file written responses to the Request, and offer their opinions whether a judicial inquiry is appropriate and necessary. The Defendants in both the Residences and Enclave case filed a memorandum in support of this Court convening a broad judicial inquiry. (DE 121]. In that docu- ment Defendants provide considerable de- tail about evidence collected, in a number of cases, of an unethical relationship be- tween Garfinkel and Hunter R and Ro- have to worry about Ken Roman If this is an issue because we can pay him off and he will recant his testimony,' and at that point maybe there is 18, 20 people In the room and I said, 'That's outrageous. There would be no way that you could ever do that or that we could ever permit that.'" (DE 119, pp. 14—I5). EFTA00177861

1260 716 FEDERAL SUPPLEMENT, 2d SERIES main, which Defendants maintain is di- rectly relevant to their defense that the insurance policies have been voided by Plaintiffs' fraud. Defendants acknowledge that there are procedural mechanisms in place that allow this Court to address these issues in this case as needed, but nevertheless argue that a broad inquiry that cuts across case lines is warranted, because Garfinkel and others have "creat- ed a fraud upon the judicial process" throughout this District. [DE 121, p. 12]. Defendants identify twelve witnesses who should testify, and ask the Court to sub- poena years worth of bank and accounting records from Garfinkel and a list of people associated with him. Residences, by that time represented by Garfinkel's and ICatzman's new law firm, filed a response in opposition to the Re- quest [DE 127], It argues that it would be improper for this Court to take on an investigative role and suggests that a broad judicial inquiry would open "an evi- dentiary Pandora's box." (DE 127, p. 9]. Notably, they assert that "(n)othing has transpired before this Court that would implicate any inherent authority the Court might have to punish or order further action taken with respect to misconduct it observes." Ltd., p. 7]. It urges that the issues raised by the Request, and at the April 16 hearing, can be addressed as needed in the normal course of this litiga- tion. Shortly after the April 16 hearing, Resi- dences filed a Motion for Protective Order Enjoining Daniel Rosenbaum from Fur- ther Violating Attorney—Client Privilege to Advance His Own Interests. [DE 122]. While the Motion is filed in the name of Residences, it mostly sets forth a series of accusations that are personal to Garfinkel. The Motion recounts the disputes between 6. Many of the assertions in that response have been repeated in other pleadings they have GTG and its former consultants Hunter R and Romain, characterizes Romain's accu- sations against Garfinkel as false, and claims the defendant insurers have unfair- ly seized upon these allegations to try to defeat the plaintiffs' legitimate claims and have engaged in a campaign to smear Gar- finkel's reputation. The Motion calls Rosenbaum a liar [DE 122, p. 17] and makes a series of disparaging accusations against him about matters that bear on the personal dispute between the former law partners, starting with Rosenbaum's "fi- nancial misconduct" when he allegedly di- verted $700,000 from the KGR bank ac- count into a personal account. Within that context, the Motion charges that Rosen- baum filed the Request for Judicial Inqui- ry, and spoke in support of that Request at the April 16th hearing, not for any legiti- mate purpose, but only to gain an advan- tage in his on-going dispute with Garfinkel and Katzman over the division of their fees and clients. According to the Motion, Rosenbaum served as counsel not only for Residences, but was also counsel to Garfinkel and was part of a Joint Defense Team ("JDT') comprised of an unnamed list of "persons sued and/or affected by" the claims brought by Hunter R, Remain, and TSSA. [DE 122, p. 7). The Motion charges that in the Request for Judicial Inquiry and at the April 16th hearing, Rosenbaum disclosed privileged information gained as part of those representations, and did so without his clients' authorizations. The Motion also accuses Rosenbaum of giving the Court this information in a manner ad- verse to his former client Residences. Resting on these accusations, the Mo- tion asks this Cunt to use its inherent au- thority to enter a "protective order" that filed, and which are summarized elsewhere in this Order. EFTA00177862

EL-AD RESIDENCES AT MIRAMAR CONDO. I. MT. HAWLEY 1261 Chess 716 F.Supp.2d 1257 2010) enjoins Rosenbaum from further disclo- sures of privileged communications. Re- markably, it goes much further and asks this Court to enjoin Rosenbaum from "ap- pearing in any case or taking any action adverse to Alan Garfinkel or any of his former clients in any case where the alle- gations of Ken Romain are, directly or in- directly, at issue." [DE 122, pp. 17-18]. Such broad injunctive relief—on its face— is excessive, as it surely would bar Rosen- baum from participating in the judicial dis- solution proceedings with his former part- ners. The Defendant insurance companies filed oppositions to the Motion for Protec- tive Order. [See DE 129, 133]. In those papers the Defendants point out, inter aria, that Rosenbaum is neither a party to this lawsuit, nor an attorney of record, that discovery is closed and, in any event, no discovery is pending involving Rosenberg. Although styled a motion for protective order, Defendants rightfully point out that it is better understood as a motion for injunctive relief against someone who is not a party to this lawsuit Defendants also raise a number of good arguments that question whether information Rosen- baum disclosed was in fact protected by privilege. They also specifically deny that Rosenbaum has given them "any informa- tion pertaining to his representation of [Plaintiffs] or other former or current clients." [DE 133, p. 3]. Perhaps recognizing the procedural flaws inherent in Residences' Motion for Protective Order, a few days after they filed that Motion, Garfinkel and Katzman filed their Motion to Intervene to Ensure Preservation of Privilege. [DE 126]. They ask to intervene in this case, individ- ually, to protect their personal interests, including what they claim were privileged communications with Rosenbaum. They add that Rosenbaum has cross-noticed Garfinkel's deposition in this and another case, and predict he will use the deposition to "gain leverage in the partnership disso- lution and to harass Garfinkel." [DE 126, p. 2]. A few days later, Garfinkel and Katzman filed yet another motion: Motion to Con- vene Sealed Ancillary Proceedings for In- junctive Relief, Sanctions, and Potential Attorney Disqualification [DE 130].' They repeat their accusations about Rosenbaum, and again charge that in the Request for Judicial Inquiry, and at the April 16th hearing, he disclosed privileged informa- tion, and made statements adverse to his former client Residences in violation of Florida Bar Rule of Professionalism 4-1.6, 4-1.9(b)-(c), and they again ask this Court to invoke its inherent power to discipline Rosenbaum. What's new is the way in which Garfinkel and Katzman ask the Court to accomplish this: they would have this Court convene an ancillary proceeding that would be conducted entirely under• seal, the sole focus of which would be Rosenbaum's alleged misconduct, that would adjudicate whether Rosenbaum vio- lated the Florida Bar Rules of Professional Conduct, and in the process they would have the Court bar Rosenbaum from filing a response to the Motion. In the end, Garfinkel would have this Court discipline Rosenbaum for breach of his ethical obli- gations, enjoin him from further miscon- duct, and disqualify defense counsel from representing their clients in this case, be- cause they have received (unidentified) in- formation protected by the attorney-client privilege and work product doctrine. Ii. ANALYSIS A. Motion to Intervene [11 Both Garfinkel and Katzman assert their right, pursuant to Rule 24(a), F.R. 7. They request a hearing on that Motion. [DE 132]. EFTA00177863

1262 716 FEDERAL SUPPLEMENT, 2d SERIES Civ. P., to intervene in this action "for the limited purpose of protecting the various privileges, and to respond to the personal attacks made upon them individually by Rosenbaum." [DE 125, p. Garfinkel and Katzman will be permitted to inter- vene for the former purpose, but not the latter•. According to the Motion to Intervene, Rosenbaum served as counsel for Garfink- el "in the matter which Romain filed against Garfinkel[,]" and their communica- tions in this respect were protected by the attorney client privilege. Id The Motion further asserts that Rosenbaum, as part of the Joint Defense Team represented his former law firm, KGR, and by association its partner, Katzman, and that disclosure of their privileged communications would harm Garfinkel and Katzman in on-going litigation. [DE 126, p. 3].3 Rule 24(a) reads as follows: (a) Intervention as of Right. Upon timely application anyone shall be per- mitted to intervene in an action: (2) When the applicant claims an inter- est relating to the property or transac- tion which is the subject of the action and he is so situated that disposition of the action may as a practical matter impair or impede his ability to protect that interest, unless the applicant's in- terest is adequately represented by ex- isting parties. The law in this Circuit, and others, is clear, that this Court must allow intervention by a client "in the first instance ... as soon as the [attorney-client] privilege issued is raised." In re Grand Jury Matter (ABC Coeµ), 736 F.2d 1330, 1881 (11th Cir.1984), (quoting In re Grand Jury Proceedings (Freeman), 708 F.2d 1571, 1575 (11th Cir. 1983)); see also In re Grand Jury Subpoe- na (Newparent, Inc.), 274 F.3d 663, 670 (1st Cir.2001) ("Colorable claims of attor- ney-client and work product privilege [are] .. . a textbook example of an entitlement to intervention as of right."); United Stalest. AT & T Co., 642 F.2d 1285, 1292 (D.C.Cir.1980); Sackman I. Liggett Group, Inc., 167 F.R.D. 6, 20-21 (E.D.N.Y. 1996). In allowing intervention, this Court notes that Garfinkel and Katzman have not demonstrated that Rosenbaum in fact served as their lawyer, or that he has or will disclose any of their privileged com- munications. While they have complained mightily that Rosenbaum has already made unauthorized disclosures, Garfinkel and Katzman have not identified for this Court which of Rosenbaum's statements in the Request for Judicial Inquiry, or at the April 16 healing, they claim are privileged. Moreover, Katzman's assertion of privilege is particularly attenuated: he claims that Rosenbaum, as part of the JDT, represent- ed their former law firm, and that as a partner in the firm Katzman personally claims a privilege as to his statements to Rosenbaum. Further, to the extent Katz- man contends that the statement Rosen- baum attributed to him, and repeated at the April 16 hearing ("You don't have to worry about Ken Romain if this is an issue because we can pay him off and he will recant his testimony") was a privileged communication, it would appear to fall squarely within the crime-fraud exception to that privilege. In this and other cir- cuits, Garfinkel and Katzman need not set forth this proof before they intervene. See In re Grand Jury Proceedings (Freeman), 708 F.2d at 1576 (intervention should have been allowed "once the claim of attorney- client privilege ... surfaced."); In re Grand Jury Matter (ABC Corp.), 735 F.2d at 1331 (the extent of the attorney-client privilege, and the possibility of unautho- 8. The Motion does not specifically identify what ongoing litigation It refers to. EFTA00177864

EL-AD RESIDENCES AT MIRAMAR CONDO. . Mt HAWLEY 1263 Cline716 17-5upp.2d 1257 (S.D.Fla. 2010) sized disclosure must be addressed after intervention); United States.). AT & T Co., 642 F.2d at 1291 ("determination of the merits of [the] claim [of privilege] is not appropriate at this threshold stage ... we must accept a party's well-pleaded alle- gations as valid.") Upon intervention, Garfinkel and Katz- man will have to meet their burden to establish that they were in fact represent- ed by Rosenbaum, and that they had privi- leged communications in the course of that attorney-client relationship that have been, or are at risk of, unauthorized disclosure.' Rule 24(a) permits intervention only "upon timely application." As already not- ed, Rosenbaum no long represents Plain- tiff in this action and he, of course, is not a party. The Court will have to hear from him however, as it considers Garfinkel's and Katzman's claims of privilege. The Court will therefore entertain a concise motion by Rosenbaum, pursuant to Rule 24(a) to intervene in this proceeding, for the same limited purpose of participating in this Court's consideration of Garfinkel's and Katzman's claims of privilege. As for Garfinkel's and Katzman's re- quest to intervene to "respond to the per- sonal attacks made upon them individually 9. In this diversity action, claims of privilege are governed by Florida law. F.R. Evd. 501. The burden of establishing that communica- tions were protected from disclosure by the attorney-client privilege falls upon the party autillnilike privilege. Bell Tel. & Tel. Co. . Deasoil, 632 So.2d 1377, 1383 I (Fla.1994); Cone I. Culverhouse, 687 So.2d 888, 892 (Fla. 2d DCA 1997) ('The privilege will not apply unless the party asserting it proves that the communications at issue come yithin its confines."); Wal—Mart Stores, Inc. Weeks, 696 So.2d 855, 856 (Fla. 2d DCA 1997) (same rule applies to work product doctrine). In meeting this burden, each ele- ment of the privilege must be affirmatively demonstrated, and the party claiming privi- lege must provide the court with evidence that demonstrates the existence of the privi- lege, which often is accomplished by affidavit. by Rosenbaum," they may not do so. (DE 126, p. 2]. As one court has noted, to intervene "the interest must be a legal interest as distinguished from interests of a general or indefinite character." United States'. AT & T Co., 642 F.2d at 1292 (citations and quotation marks omitted).1° This Court does not need to provide Gar- finkel and Katzman a forum to respond to Rosenbaum's "personal attacks." In the numerous pleadings they have filed since Rosenbaum's Request for Judicial Inquiry, Garfinkel and Katzman have already re- peatedly answered Rosenbaum's assertions and have done so in a vitriolic manner. Rosenbaum no longer represents Resi- dences, thus he no longer has a voice in this lawsuit to make additional claims about his former law partners. There are other forums in which the former law part- ners can air their grievances against one another they are already embroiled in Judicial dissolution proceedings, and if complaints have not already been filed with the Florida Bar, they are likely to be." Rule 24(a) does not require interven- tion by Garfinkel and Katzman to protect themselves from Rosenbaum's complaints against them. See CSX Tramp., Inc.'. Admiral Ins. Co., 1995 WL 855421 at *1-2, 1995 U.S. Dist. LEXIS 22359 at '4-5 (M.D.Fla. July 20, 1995). In Florida, corporate claims of privilege are sub- ject to a heightened level of scrutiny, and the Florida Supreme Court has established five criteria to establish a corporate claim of attor- pep-client privilege. Deacon, id., at 1383. 10. While the Second Circuit has recognized that injury to reputation is one that might be served by Rule 24(a), the parties have not cited any similar authority in this Circuit, and this Court is aware of none. II. For that matter, evidence of criminal fraud, witness tampering or bribery, is best referred to law enforcement authorities. EFTA00177865

1264 716 FEDERAL SUPPLEMENT, 2d SERIES B. Motion for Ancillary Proceeding [2] Garfinkel and Katzman have also asked this Court to convene an extraordi- nary ancillary proceeding: it would be held under seal," its sole purpose would be to sanction Rosenbaum for his alleged un- authorized disclosures of his clients' privi- leged information in his Request for Judi- cial Action and at the April 16 hearing, enjoin Rosenbaum from future similar con- duct, determine whether Rosenbaum vio- lated Florida Bar Rules of Professional Conduct 4-1.6, 4-1.9(b)-(c), and to disqual- HST Defendants' counsel because Rosen- baum has given them Garfmkel's and Katzman's privileged information. Re- markably, they suggest Rosenbaum should have a limited opportunity to defend him- self in such an action ("Rosenbaum should be ordered not to disclose any information or file any response, unless permitted by Court order.") [DE 130, p. 2). The Supreme Court, in Kokkonen Guardian Life Nair. Co. of Amer., 611 U.S. 876, 114 S.Ct. 1678, 128 L.Ed.2d 391 (1994), wrote the following about ancillary jurisdiction. Federal courts are courts of limited ju- risdiction. They possess only that pow- er authorized by Constitution and stat- ute, which is not to be expanded by judicial decree. It is to be presumed that a cause lies outside this limited jurisdiction, and the burden of establish- ing the contrary rests upon the party asserting jurisdiction. • * • 12. While the Court can make in camera re- view of possible privileged materials, it will not engage In wholesale closed dockets. Pro- ceedings may be sealed only upon a showing of exceptional circumstances, and harm to reputation is not sufficient to overcome the strong presumption In favor of public access to the courts. Brown I. Advantage Engineer- The doctrine of ancillary jurisdiction .. . recognizes federal courts' jurisdiction over some matters (otherwise beyond their competence) that are incidental to other matters properly before them. Generally spealdng, we have asserted ancillary jurisdiction ... for two sepa- rate, though sometimes related pur- poses: (1) to permit disposition by a single court of claims that are, in vary- ing respects and degrees, factually inter- dependent, and (2) to enable a court to function successfully, that is, to manage its proceedings, vindicate its authority, and effectuate its decrees. /a at 377-380, 114 S.Ct. 1678 (citations omitted). Garfinkel and Katzman have not carried their burden to demonstrate that their proposed ancillary proceeding would satisfy either purpose. As for the first purpose, this Court clearly has all claims before it necessary to resolve this matter. As for the second purpose, this Court can "manage its proceedings, vindicate its au- thority, and effectuate its decrees" without extending its jurisdiction. Specifically, it can: (1) resolve any disputes about privi- leges and issue appropriate orders; (2) if it needs to pass on ethics breaches by coun- sel, it has the power to do so; " and (3) it can, and will, use its authority to insist that counsel conduct themselves with a degree of restraint and professionalism that has been lacking in many of the plead- ings now before this Court. In sum, this ing, Inc., 960.17.2d 1013, 1016 (11th Cir. 1992); Wilson American Motors Corp., 759 F.2d 1568 (11th Cir.1985). 13. The Florida Bar Is uniquely suited to ad- dress compliance with its Rules of Profession- al Conduct and, at this Juncture, this Court defers to the Florida Bar to do Just that. EFTA00177866

EL-AD RESIDENCES AT MIRAMAR CONDOS. MT. HAWLEY 1265 Cite as 716 2,..Supp.2d 1257 (S.D.Fhe. 2010) Court will not expand its jurisdiction to engage in an investigation of Rosenbaum.0 C. Motion for Protective Order Residences' Motion for Protective Order is also denied. Residences has not provid- ed this Court with information to support its claim that Rosenbaum has disclosed its confidential attorney-client communica- tions. The Motion can only be understood as Garfinkel's and Katzman's personal complaints about Rosenbaum, and to the extent they ask this Court to enjoin Rosenbaum, a non-party, from prospective violations of the attorney-client privilege, that motion is denied.15 The Court will address Garfinkel's and Katzman's claims of privilege consistent with its ruling on the Motion to Intervene. D. Request for Judicial Action Rosenbaum, and the Defendant insur- ers, would both like this Court to step beyond the four corners of this lawsuit and investigate various possibilities of fraud upon this and other Courts. The proposed areas of inquiry include: (1) Romain's ap- parent perjury, either at the March 30 deposition, or earlier depositions; (2) whether Garfinkel or Katzman improperly persuaded Romain to recant his sworn ac- cusations against them; (3) whether Gar- finkel, Katzman or their consultants en- gaged in fraud by helping their clients to submit false insurance claims. This al- leged misconduct is serious, and this Order should not be misconstrued to suggest oth- erwise. This Court nevertheless declines to en- gage in a free-ranging inquiry into matters 14. If the Court felt that such an inquiry were appropriate, it would not limit the Inquiry to Rosenbaum's alleged transgressions, but would include within its scope the serious allegations of misconduct by Garfinkel and 14317.man. pending before other courts, as those courts are best suited to manage their own proceedings. Allegations of inflated insur- ance claims, kickbacks and improper busi- ness relationships between lawyers and consultants have been raised in the course of similar litigation before other courts, where they have been addressed in the context of those proceedings without hav- ing to embark on a sweeping investigation. The only new information here is Romain's March 30 deposition testimony in which he recanted his earlier accusations of miscon- duct by Garfinkel and others, and Rosen- baum's disclosure, at the April 16 hearing, of Katzman's alleged suggestion that Ro- main could be paid to recant that testimo- ny. These developments, without doubt, are extraordinary. They do not require this Court, however, to broadly investigate matters before other courts and issue rul- ings that may limit how other courts deal with this evidence, if at all, in the cases before them. As for this case, this Court can address evidence of fraud, perjury and other mis- conduct as necessary to resolve the issues here. For example, whether Residences submitted inflated damage claims is rele- vant to Defendants' defense that the policy is void. Exactly what evidence bears on this defense and may be submitted to a jury, can be decided with pre-trial motions and at trial. As already noted, to the extent misconduct exceeds the bounds of this litigation there are other forums and authorities to address them. The point is that this Court has proce- dural mechanisms in place that allow it to IS. The Court strongly rejects the request that this Court enjoin Rosenbaum from "appear- ing In any case or taking any action adverse to Alan Garfinkel or any of his former clients In any case where allegations of Ken Romain are, directly or indirectly at issue," as a mis- use of Its power. [See DE 122, pp. 17-181 EFTA00177867

1266 716 FEDERAL SUPPLEMENT, 2d SERIES consider these issues, as necessary to bring this case to a just conclusion. Given those mechanisms, this Court will not ex- ercise its discretion to make an extraordi- nary and unnecessary use of its power. III. CONCLUSION For the foregoing reasons, it is hereby ORDERED that: 1. Residences' Request for Judicial In- quiry [DE 103] is DENIED. 2. The Defendants' Joint Statement Requesting a Broad Judicial Inquiry [DE 121] is DENIED. 8. Residences' Motion for Protective Order [DE 122] is DENIED. 4. Garfmkel's and Katzman's Motion to Intervene [DE 126) is GRANTED. 6. Garfinkel's and Katzman's Motion to Convene A Sealed and Limited Ancillary Proceeding [DE 130] is DENIED. 6. Garfinkel's and Katzman's Motion for Hearing [DE 132] is DENIED. 7. Westchester's Motion for Extension of Time to Respond [DE 146) is DENIED as moot. Donna Katz MAPLES, Plaintiff, 1. UHS OF GEORGIA, INC., UHS of Geor- gia Holdings, Inc., and UHS of Peach- ford, L.P., doing business as Peach- ford BHS of Atlanta, Defendants. Civil Action No. 1:09-CV-01964—WEJ. United States District Court, N.D. Georgia, Atlanta Division. May 3, 2010. Background: Former employee brought action against her former employer, alleg- ing employer eliminated her part-time nurse position in violation of Age Discrimi- nation in Employment Act (ADEA). Em- ployer moved for summary Judgment. Holdings: The District Court, Walter E. Johnson, United States Magistrate Judge, held that: (1) employee failed to establish prima facie case of disparate treatment, and (2) employee failed to demonstrate pre- text. Motion granted. 1. Civil Rights 6=1210 To establish a disparate-treatment claim under the ADEA, an employee must prove that age was the but-for cause of the employer's adverse decision. Age Dis- crimination in Employment Act of 1967, § 4(a)(1), 29 U.S.C.A. § 623(a)(1). 2. Civil Rights 6=1672 The ADEA does not permit a sepa- rate recovery of compensatory damages for pain and suffering or emotional dis- tress. Age Discrimination in Employment Act of 1967, § 2 et seq., 29 U.S.C.A. § 621 et seq. 3. Civil Rights e=.1.539 Where there is no direct or statistical evidence of age discrimination, the court applies the burden-shitting framework es- tablished in McDonnell Douglas to evalu- ate an ADEA claim based upon circum- stantial evidence. Age Discrimination in Employment Act of 1967, § 4(aX1), 29 U.S.C.A. § 623(aX1). 4. Civil Rights 6=1639 Under the McDonnell Douglas bur- den-shifting framework, if an employee is EFTA00177868

118 103 FEDERAL RULES DECISIONS previous order, courts are restrained by a careful statutory analysis for each item of a bill of costs. While United States'. Kolesar is helpful in deciding whether the costa of a stenographic transcript should be awarded under 28 U.S.C. § 1920(2), it is not applicable to the decision whether photo- copying expense is reimbursable under 28 U.S.C. § 1920(4). The following statement is a clear explanation of the necessity re- quired for copies under subsection (4): Photocopying charges attributable to dis- covery and the court's copies of plead- ings, motions, and memoranda are "rea- sonable necessary for use in the case" and can be awarded. Extra copies of filed papers and correspondence, and cop- ies of cues, however, are not necessary but are for the convenience of the attor- neys and therefore not taxable. Independence Tube Corp. I Copperweld Corp., 643 F.Supp. 706, 722 (N.D.Ill.1982). B. Disallowance of Reimbursement for Costs of Depositions Not Adequately Identified as Necessary for Motion for Summary Judgment (8) In the previous order, this court awarded the costs of two depositions which were tendered into evidence at the trial. The court's allowance of the costs of those two depositions does not mean, as suggest- ed in the defendant's motion for reconsider- ation, that this court would not award the costs of depositions used in supporting a successful motion for summary judgment. Such an award is appropriate when the attorneys can point to the use of the depo- sitions with some particularity. Consider- ing, however, the strong policy of the American system against the shifting of litigation expenses, a general statement by the attorneys that the parties and the court relied on five depositions for an order granting summary judgment is not suffi- cient; the party seeking reimbursement must show how the depositions were neces- sary for the court's disposition of the mo- tion. This court's ruling, therefore, was consistent with Jeffries I. Georgia Resi- dential Finance Authority, 90 F.R.D. 62 (N.D.Ga.1981), and reconsideration is un- necessary. In summary, the defendant's motion for reconsideration is hereby DENIED, and the court hereby ALLOWS $137.26 for photo- copying expense under 28 U.S.C. § 1920(4). This court's review of the bill of costs is now complete and the items, as allowed in this order and the previous order, may now be included in the judgment. Claire NELSON, Plaintiff, I Samuel N. GREENSPOON, and Eaton, Van Winkle and Greenspoon, a partnership, Defendants. No. 83 Chi. 7962 (SWK). United States District Court, S.D. New York. Sept. 11, 1984. An action was filed involving a dispute between a corporation's former president and her attorney. The corporation sought to intervene to preserve its claims to a purported attorney-client privilege sur- rounding documents generated by the at- torney. The District Court, Kram, J., held that: (1) the corporation could intervene, and (2) the corporation failed to carry its burden of showing that the documents were privileged. Motion to intervene granted and mo- tion for suppression and return of docu- ments denied. 1. Federal Civil Procedure 0=321 Corporation's motion seeking return of allegedly privileged documents in its for- mer president's possession and suppression of those documents already produced in EFTA00177869

NELSON'. OREENSPOON coo as 103 P.R.D. 118 (1984) litigation could be treated as motion to intervene, even though moving papers did not explicitly seek leave to intervene. Fed. Rules. Civ.Proc.Rules 24, 24(a, c), 28 U.S. C.A. 2. Federal Civil Procedure s=135 Although corporation which sought to intervene in order to protect allegedly privi- leged documents did not meet with formali- ties required by intervention rule, that did not preclude granting intervention in that denial of motion would exalt form over substance. Fed.Rules Civ.Proc.Rules 24, 24(a, c), 28 U.S.C.A. 3. Federal Courts s=23 If corporation's intervention to pre- serve its claims to purported attorney-client privilege surrounding various documents involved in litigation was as of right, dis- trict court could hear case irrespective of corporation's citizenship under doctrine of ancillary jurisdiction. Fed.Rules Civ.Proc. Rules 24, 24(a, c), 28 U.S.C.A. 4. Federal Civil Procedure ts=t335 Corporation could intervene in action between corporation's former president and her attorney concerning attorney's repre- sentation of president in order to assert its claim of attorney-client privilege surround- ing documents generated by attorney, who also represented corporation, where attor- ney was not actively protecting that privi- lege. Fed.Rules Civ.Proc.Rule 24(a), (aX2), 28 U.S.C.A.; Fed.Rules Evid.Rule 501, 28 U.S.C.A.; N.Y.McKinney's CPLR 4503. 6. Witnesses o=>198(1) Existence of attorney-client privilege is based upon policy of encouraging openness and full disclosure between client and his or her attorney. N.Y.McKinney's CPLR 4503. 6. Witnesses 9:=198(1) In order to minimize intrusion of attor- ney-client privilege upon ascertainment of truth, scope of privilege must be, and is, confined to narrowest possible ambit which will still achieve purpose of full disclosure between client and his or her attorney. N.Y.McKinney's CPLR 4603. 119 7. Witnesses 4=222 Burden of establishing existence of at- torney-client privilege is upon party claim- ing privilege. N.Y.McKinney's CPLR 4508. 8. Witnesses <3:=204(2) Former president of corporation, which claimed that corporate documents were protected by attorney-client privilege, was properly in possession of those documents where documents discussed former presi- dent's personal matters. N.Y.McKinney's CPLR 4503. 9. Witnesses CP>205 Corporate documents which involved communications to or from third parties, which contained information obtained from third parties or which referred to on-going communications with third party were not confidential and, therefore, were not pro- tected by corporation's attorney-client privi- lege. N.Y.McKinney's CPLR 4503. 10. Witnesses A=204(2) Corporation could not use its claim of attorney-client privilege with respect to documents to regain possession of purport- edly privileged documents in possession of corporation's former president. N.Y. McKinney's CPLR 4503. Morris Pottish, New York City, for plain- tiff. Olnick, Boxer, Blumberg, Lane & Troy by Andrew N. Krinsky, New York City, for defendant Samuel N. Greenspoon. Richenthal, Abrams & Moss by Arthur Richenthal, New York City, for proposed intervenor Hosiery Corp. of America. MEMORANDUM OPINION AND ORDER KRAM, District Judge. The above-captioned action is before this Court in an unusual posture: a corporation, Hosiery Corporation of America ("HCA"), seeks to intervene in this dispute between its erstwhile president, Claire Nelson, and EFTA00177870

120 103 FEDERAL RULES DECISIONS her attorney, Samuel N. Greenspoon, con- cerning Greenspoon's representation of Nelson, in order to preserve its claims to a purported attorney-client privilege sur- rounding various documents generated by Greenspoon, also RCA's attorney, copies of which were sent to Nelson during her ten- ure with HCA and remain in her possession to date. HCA seeks an order directing Nelson to turn over all of the documents, and any copies thereof, and prohibiting her from producing or disseminating those doc- uments in any way. For the reasons stated below, HCA is granted leave to intervene, but its motion to restrain plaintiff and re- plevy the documents is denied. —BACKGROUND— HCA is a closely-held Delaware corpora- tion with its principal place of business in Pennsylvania. HCA is primarily engaged in selling hosiery through the mails. Plaintiff Claire Nelson, along with her late husband Jules, had been the sole and joint owners of the outstanding shares of HCA. Claire Nelson also was President, or executive officer in charge of operations, of HCA for several years prior to the end of 1980. On December 2, 1980, Claire and Jules Nelson entered into a separation agreement. On the same date, Claire en- tered into an agreement with HCA where- by HCA would pay Claire $1,260,000, over the course of ten years, in redemption of her interest in the corporation. Claire was represented in the preparation of these agreements by defendant Green- spoon. Greenspoon is a member of the bar of the State of New York. He had, before and after the preparation of these agree- ments, represented Claire in personal mat- ters. Additionally, Greenspoon had at times represented Jules in personal mat- ters. He also has been HCA's general counsel since 1977. Greenspoon was the only attorney involved in the preparation of these agreements. 1. HCA is represented here by the attorney who represents Greenspoort in the Surrogates Court In or about March, 1981, Claire Nelson's employment by HCA was terminated. She has not been affiliated with HCA since that time. In or about December, 1981, Jules Nel- son instituted an action against Claire in New York State Supreme Court The sub- stance and merits of that action are irrele- vant for purposes of this motion. Claire counterclaimed in that action to set aside the agreements. On November 19, 1983, Jules Nelson died, slowing the progress of the Supreme Court action. That action is still pending. Jules Nelson's will was filed for probate in Surrogate's Court, New York County. Greenspoon and Helen Gioulis (not a party herein) were appointed preliminary execu- tors. The eligibility of Greenspoon for per- manent letters testamentary is being con- tested in Surrogate's Court. In November, 1988, Claire instituted this action against Greenspoon alleging mal- practice and conversion. Discovery in this action had been proceeding apace. Then, in the course of discovery, Claire produced copies of letters written by Greenspoon. Greenspoon maintained that the documents were privileged as between HCA and its attorney, but responded to questions con- cerning them. HCA then brought on the instant mo- tion by Order to Show Cause dated May 11, 1984. In support of its motion, HCA sub- mitted an affidavit by Arthur Richenthal, dated May 7, 1984 ("Richenthal Aff."). At- tached as exhibits to the affidavit were copies of several documents which Claire Nelson has produced during discovery herein as to which HCA claims an attorney- client privilege applies. By this motion, HCA seeks the return of all privileged doc- uments (and any copies thereof) in Claire's possession and the suppression of those privileged documents already produced by Nelson in this action. proceeding. EFTA00177871

—DISCUSSION— (1) Plaintiff raises several procedural arguments in opposition to HCA's motion which must be dealt with first. Initially, plaintiff claims that HCA is a non-party with no standing to move in this action. Admittedly, FICA's moving papers do not explicitly seek leave to intervene, but rath- er indicate that HCA appears "for [a] spe- cific and limited purpose." Richenthal Aff., II 2. However, on June 7, 1984, HCA addressed a letter to the Court requesting that the Court construe the motion as in- cluding a request to intervene. The Court will, therefore, construe this motion as one to intervene. 12) Plaintiff next argues that HCA's pa• pers are insufficient to support a motion to intervene pursuant to Rule 24 of the Feder- al Rules of Civil Procedure. Rule 24(c) provides in relevant part, that "[a] person desiring to intervene shall serve a motion to intervene ... [which] shall state the grounds therefor and shall be accompanied by a pleading setting forth the claim or defense for which intervention is sought." HCA has not met the formalities required by Rule 24(c); however, denying its motion on that ground would exalt form over sub- stance. See Belgian American Mercan- tile Corp. I De Groeve-Marcotte & Fits, 433 F.Supp. 1098, 1101 (S.D.N.Y.1977). In Belgian American, as in this case, the movant, a non-party, had acted by Order to Show Cause for some relief and had not specifically styled its request a petition to intervene. In that case, as in this one, the relief sought was clearly spelled out in the Order to Show Cause, albeit not in the form of a pleading. Noting that the "Sec- ond Circuit has held that in the face of strong circumstances the formal require• ments of Rule 24 need not be insisted on" (citing Kuplerman • Consolidated Re- search & Mfg. Corp.. 469 F.2d 1072, 1014 n. 1(2d Cir.1972)), the court held that "non- compliance with the strict requirements of Rule 24(c)" would not preclude intervention 2. If these documents relate solely to Green- spoon's representation of FICA. as HCA con- tends, this Court is at a loss to understand how they are relevant to, or the subject of, this ac- NELSON I. GREENSPOON 121 P.R.D. I le (1984) and a determination of the intervenor's mo- tion on the merits. 483 F.Supp. at 1101. This Court feels that that is the proper course to take in this instance as well. (3) Plaintiff also argues that the Court would be divested of subject matter juris- diction if HCA were permitted to intervene because HCA is not of citizenship diverse from that of plaintiff. If HCA's interven- tion is as of right, pursuant to Fed.R.Civ.P. 24(a), then this Court is empowered to hear this case irrespective of RCA's citizenship under the doctrine of ancillary jurisdiction. See Formulate, Inc. Hartley Pen Co., 318 F.2d 486 (9th Cir.1963). Rule 24(a) provides, in relevant party, as follows: Upon timely application anyone shall be permitted to intervene in an action: (2) when the applicant claims an interest relating to the property or transaction which is the subject of the action and he is so situated that the disposition of the action may as a practical matter impair or impede his ability to protect that inter- est, unless the applicant's interest is ade- quately represented by existing parties. (4) HCA seeks to intervene here to as- sert its purported attorney-client privilege to documents being made a subject of this action. This Court finds that the provi- sions of Rule 24(a)(2) do apply to this situa- lotion: to wit, the client claims an interest, an attorney-client privilege, in documents which are the subject of the action,' and the existing party, the attorney, is not ac- tively protecting that privilege. See In re Katz, 623 F.2d 122 (2d Cir.1980). HCA claims that various documents in Claire Nelson's possession are HCA docu- ments, subject to the attorney-client privi- lege, and that she should not be permitted to produce, or otherwise use, such privi- leged documents in this lawsuit. The pa- tion. Be that as It may, Nelson has produced them, and questioned Greenspoon about them; therefore, plaintiff has essentially made them the subject of this action at this stage. EFTA00177872

122 103 FEDERAL RULES DECISIONS rameters of the claimed privilege in this diversity action are defined by state law. Fed.R.Evid. 501. The attorney-client privi- lege in New York is governed by section 4503 of the New York Civil Practice Law and Rules ("CPLR"); however, it is deeply rooted in common law. See People O'Connor, 85 A.D.2d 92, 94, 447 N.Y.S.2d 553, 656 (4th Dep't 1982). [6, 61 The existence of such a privilege is based upon a policy of encouraging open- ness and full disclosure between a client and his or her attorney. See Upjohn Co.' United States, 449 U.S. 383, 389, 101 S.Ct. 677, 682, 66 L.Ed.2d 584 (1981); Priest' Hennessy, 51 N.Y.2d 62, 6748, 431 N.Y. S.2d 611, 613-514, 409 N.E.2d 983, 985-986 (1980). Nonetheless, the application of the privilege serves to exclude reliable evi- dence and, often, to block the truth-deter- mining processes of the courts. Priest, 61 N.Y.2d at 68, 431 N.Y.S.2d at 514, 409 N.E.2d at 986; In re Jacqueline F., 47 N.Y.2d 215, 219, 417 N.Y.S.2d 884, 886-87, 891 N.E.2d 967, 969-70 (1979). In order to minimize the intrusion of the privilege upon the ascertainment of truth, the scope of the privilege must be, and is, confined to the narrowest possible ambit which will still achieve the purpose of full disclosure. Priest, 61 N.Y.2d at 68, 431 N.Y.2d at 514, 409 N.E.2d at 986; see also In re Bekins Storage Co., 118 Misc.2d 173, 177, 460 N.Y. S.2d 684, 690 (Sup.Ct.N.Y.Co.1983). (7) The specific formulation of the priv- ilege, as set out in section 4503 of the CPLR, provides, in relevant part, as fol- lows: Unless the client waives the privilege, ... any person who obtains without the knowledge of the client evidence of a confidential communication made be- tween the attorney ... and the client in the course of professional employment, shall not ... be allowed to disclose such communication. N.Y.Civ.Prac.Law § 4503 (McKinney 1963) (Supplementary Pamphlet 1964 to 1983). 3. Although, as discussed below, it Is not always clear who the client was. Whether or not that privilege covers the communications here at issue must be re- solved by this Court, but the burden of establishing the existence of an attorney- client privilege applicable to these particu- lar circumstances is upon HCA, the party claiming the privilege. See Priest, 61 N.Y.2d at 69, 431 N.Y.S.2d at 514, 409 N.E.2d at 986; see also Katz, 623 F.2d at 125; United States' Demauro, 581 F.2d 50, 66 (2d Cir.1978). HCA argues initially that these commu- nications were made during the course of an attorney-client relationship, and there appears to be no dispute about this' HCA further argues that these corporate com- munications are confidential, urging baldly that "[c)onfidentiality exists where the communications sought to be protected were made for the purposes of either re- ceiving or giving legal advice." HCA's Memorandum in Support of Motion, p. 4. HCA also argues baldly that it has not waived its privilege, and that Nelson pos- sessed these documents without RCA's knowledge. These last three contentions are hotly disputed. Treating the last argument first, it is beyond peradventure that HCA "knew" Nelson obtained these documents,' since she is named on the documents (or at least most of them) as an addressee, either of the original or of a copy. Nelson argues, therefore, that section 4608, by its terms, is inapplicable. HCA argues in response that Nelson received these documents solely in her capacity as corporate officer. As such, HCA argues, Nelson's receipt was the equivalent of HCA's receipt, so the docu- ments remained privileged (to the same extent that they were privileged to begin with). HCA argues further that it did not "know" that she retained the documents after she left her employ there, and that such retention was wrongful and did not divest HCA of its claimed privilege. Nel- son, on the other hand, responds that these documents were addressed to her personal- ly, not as corporate officer, and/or that 4. At least insofar as a corporation can 'knows" anything. EFTA00177873

HCA knew she retained them, at least be- cause Jules (the sole remaining sharehold- er, chief officer, and director of HCA) shipped them to her and knew she had them. HCA argues that Jules' knowledge of, or even complicity in, Nelson's retention of the documents is irrelevant because he did not have the authority to waive HCA's • privilege.° The Court has attempted to parse these bickering thrusts and parries in an effort to determine the applicability of section 4603. It is essential that the general na- ture of the relationship among the four parties involved—Claire, Jules, HCA and Greenspoon—be understood. HCA is, or was a very closely held corporation. Claire and Jules were the sole shareholders, and were the principal officers, of the corpora- tion. HCA was, in sum, very much a "Mom and Pop" operation—the alter ego of Claire and Jules. Greenspoon, was the at- torney for all three. He handled the Nel- sons' personal affairs as well as their busi- ness affairs. The distinctions that HCA makes now, between Claire Nelson, as cor- porate officer, and Claire Nelson, as indi- vidual, and between Claire Nelson and HCA, were not so neatly defined in fact.° DU A perusal of the documents as to which HCA claims its privilege° indicates that Greenspoon quite simply did not al- ways distinguish between Claire, the indi- vidual, and HCA. In other words, several of the documents were addressed to per- sonal matters as well as corporate ones. For example, document D 220 discusses property owned by Jules and Claire Nelson in the context of a broader discussion of corporate matters. Likewise, document D 5. HCA makes this argument through the affida- vit of its attorney without any citation or sup- port in case law or In corporate records. The Court, however, need not address this conten- tion here. 6. The other courts Involved In these tripartite proceedings have apparently held to the same effect with respect to the blurred distinction between Jules and HCA. 7. The Court notes that RCA has not shown the same vigor with which it arguer its desire to NELSON I. GREENSPOON 123 Cite as 103 F.R.D. 113 (1934) 241 refers to life insurance (presumably personal) amidst corporate matters. Docu- ment D 394 refers to Claire's potential criminal exposure from HCA's activities. These are but examples of the personal information discussed in what seem to be predominantly corporate documents. Since these documents discuss Claire's personal matters, I find that she is properly in pos- session of them. (9) Moreover, the Court finds that some of these documents are not confidential, and therefore are not privileged. RCA's bald assertion that a document is automati- cally confidential if legal advice is sought or provided in the document is not %correct statement of the law. See Herbert'. Lan- do, 73 F.R.D. 381, 899 (S.D.N.Y.), remand- ed on other grounds, 668 F.2d 974 (2d Cir.1977), rev'd and remanded on other grounds, 441 U.S. 163, 99 S.Ct. 1685, 60 L,Ed.2d 116 (1979). There, the court stab ed, "(n)or is privileged status automatically conferred by the fact that the memoran- dum may express an opinion of counsel; opinions are privileged only to the extent that they are based upon, and consequently reveal, information furnished by the client in confidence." it (emphasis added). A communication is not confidential if it ip- volves third parties. See, e.g., People Beige, 59 A.D.2d 807, 308, 399 N.Y.S.2d 689, 542 (4th Dept1977) (quoting United States United Shoe Mach. Corp., 89 F.Supp. 357, 368-69 (D.Mass.1950) ("with- out the pLesence of strangers")); Randy Intl Ltd.". Automatic Compactor Corp., 97 Misc.2d 977, 412 N.Y.S.2d 995 (Civ.Ct.. Queens Co. 1979). Thug, documentary communications to or from third parties are not confidential. Likewise, documenta- keep these documents privileged and confiden- tial in the way it actually treats those docu- ments. HCA submitted copies of the very docu- ments it claims arc privileged to this Court as exhibits In the publicly filed order to show cause. HCA did not make any effort to have those documents sealed from public access. Since I find that the documents are not privi- leged, I need not determine whether HCA unwit- tingly waived its privilege by filing these docu- ments In this manner. EFTA00177874

124 103 FEDERAL RULES DECISIONS ry communications are not confidential if copies thereof are sent to third parties. Furthermore, information obtained from third parties is not privileged. See Bekins Storage Co., 118 Misc.2d at 179, 460 N.Y.S.2d at 691. Document D 220 as to which HCA claims a privilege, was ad- dressed to Mr. Terry Arch of Touche, Ross & Co., and therefore is not privileged. A copy of document D 271 was sent to Ms. Dolores Geraghty and therefore is not priv- ileged.' Plaintiff's Exhibits 37 and 38 (part of Exhibit 6 to the Order to Show Cause herein) contain information obtained from Mr. Arch, and refer to ongoing communica- tions with Mr. Arch regarding the subject of the documents; therefore, these are not confidential. See J.P. Foley & Co., Inc Vanderbilt, 66 F.R.D. 523, 626 (S.D.N.Y.1974). These are but examples of the several documents that are not confi- dential, and therefore not privileged for this reason as well. (10) Finally, HCA has not cited a single example of the attorney-client privilege be- ing used to regain possession of purported- ly privileged documents. Given the need to limit the scope of the privilege, this Court will not countenance HCA's attempt to cre- ate new affirmative applications for the privilege. Cf., Liberty Mut. Ins. Co. Engels, 41 Misc.2d 49, 51, 244 N.Y.S.2d 983, 986 (Sup.CL Kings Co.1963) (privilege is a shield, not a sword), offd, 21 A.D.2d 808, 260 N.Y.S.2d 851 (2d Dep't 1964). In sum, HCA has failed to carry its bur- den of showing that these documents are privileged. They appear to properly be in Claire Nelson's possession, and shall re- main so. HCA's motion to intervene is GRANTED and its motion for suppression and return of the documents is DENIED. Preparation for trial is to continue apace. SO ORDERED. 8. The Court does not know the nature of the relationship between Ms. Geraghty and HCA. Ms. Geraghty may be a corporate Insider such that the communication remained confidential; however, HCA certainly did not sustain its bur. den of establishing that fact, if It is the case. GOLDEN EAGLE DISTRIBUTING CORPORATION, Plaintiff, I. BURROUGHS CORPORATION, Defendant No. C-84-0523-WWS. United States District Court, N.D. California. Sept. 19, 1984. Action was brought to recover dam- ages arising out of allegedly defective com- puter system sold to corporation. After removal from state court to federal court in Minnesota on basis of diversity, followed by transfer to the Northern District of California, seller moved to dismiss claims as time barred. Following denial of ma tion, counsel for defendant was directed to submit memorandum explaining why sanc- tions should not be imposed in connection with the motion. The District Court, Schwarzer, J., held that (1) legal argu- ment purporting to reflect existing law but instead being predicated upon, and not merely arguing for, an extension of the existing law violates rule relating to attor- ney's certification of pleadings, motions, and other papers by his signature thereon, regardless of whether purpose is to cause unnecessary delay or needless expense or whether counsel acted in good faith, and (2) failure to cite authority adverse to mov- ant's position or to make reasonable in- quiry to determine whether motion to dis- miss is warranted by existing law also via lates rule, warranting sanctions. Sanctions ordered. L Attorney and Client 4=42(14) Local counsel associated in case with out-of-state counsel for party to the action The same is true of documents addressed to Mr. Uri Shoham, except in the ease of those docu- ments, since they were addressed to Mr. Sho- ham at HCA's address, the Court was willing to assume the insider status of Mr. Shoham in spite of RCA's failure of proof. EFTA00177875

hups://web2.wesilawoom/prinUprintstream.aspiks=WLW11.078Lvr=2.0.. Wdstlaw, Federal Rules of Civil Procedure Rule 24 United States Code Annotated Currentness Federal Rules of Civil Procedure for the United States District Courts (Refs & Annos) Kui Title IV. Parties Rule 24. Intervention (a) Intervention of Right.On timely motion, the court must permit anyone to intervene who: (1) is given an unconditional right to intervene by a federal statute; or (2) claims an interest relating to the property or transaction that is the subject of the action, and is so situated that disposing of the action may as a practical matter impair or impede the movant's ability to protect its interest, unless existing parties adequately represent that interest. (b) Permissive Intervention. (1) In General.On timely motion, the court may permit anyone to intervene who: (A) is given a conditional right to intervene by a federal statute; or (B) has a claim or defense that shares with the main action a common question of law or fact. (2) By a Government Officer or Agency.On timely motion, the court may permit a federal or state governmental officer or agency to intervene if a party's claim or defense is based on: (A) a statute or executive order administered by the officer or agency; or (B) any regulation, order, requirement, or agreement issued or made under the statute or executive order. (3) Delay or Prejudice.ln exercising its discretion, the court must consider whether the intervention will unduly delay or prejudice the adjudication of the original parties' rights. (c) Notice and Pleading Required.A motion to intervene must be served on the parties as provided in Rule 5. The motion must state the grounds for intervention and be accompanied by a pleading that sets out the claim or defense for which intervention is sought. I of 2 9/25/11 9:21 PM EFTA00177876

(Amended December 27, 1946, effective March 19, 1948; December 29, 1948, effective October 20, 1949; Januai 1963, effective July 1, 1963; February 28, 1966, effective July I, 1966; March 2, 1987, effective August 1, 1987; 30, 1991, effective December I, 1991; April 12, 2006, effective December 1, 2006; April 30, 2007, efft December 1, 2007.) Amendments received to 7-15-11 Westlaw. (C) 2011 Thomson Reuters. No Claim to Orig. U.S. Govt. Works. END OF DOCUMENT @ 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. 2of2 EFTA00177877

Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2011 Page 1 of 9 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE No. 08-80736-CIV-MARRA/JOHNSON JANE DOE I and JANE DOE 2, Plaintiffs, UNITED STATES OF AMERICA, Defendant. MOTION FOR LIMITED INTERVENTION OF JEFFREY EPSTEIN This is a motion by Jeffrey Epstein pursuant to Federal Rules of Civil Procedure 24(a) and 24(b) to intervene for the limited purpose of seeking a protective order and responding to the motions of Jane Doe 1 and Jane Doc 2 for disclosure, evidentiary use, and widespread dissemination of the plea negotiation letters and emails between his lawyers and federal prosecutors. Those letters and emails were written in furtherance of plea negotiations, encouraged by the broad protections of Federal Rule of Evidence 410, Federal Rule of Criminal Procedure 11(f), and the constitutional right to effective assistance of counsel. They are privileged, confidential, not discoverable, and inadmissible as evidence at any proceeding in this case. I. MANDATORY AND DISCRETIONARY INTERVENTION An PROPER Intervention is proper as a matter of right under Federal Rule of Civil Procedure 24(a) because Mr. Epstein has an interest in protecting his privileged and confidential plea negotiations, and "disposing of the action may as a practical matter impair or impede [his] ability to protect [his] interest . . . ." FED. R. Civ. P. 24(a). Unless allowed to intervene, Mr. Epstein could suffer the injustice of having his privilege and confidentiality claims erased without ever having been heard. EFTA00177878

Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2.011 Page 2 of 9 See El-Ad Residences at Miramar Condo. Ass'''. Inc. I Mt. Hawley Ins. Co., 716 F. Supp. 2d 1257, 1262 (S.D. Fla. 2010), quoting In re Grand Jury Subpoena (Newparent Inc.), 274 F.3d 563, 570 (1st Cir. 2001) (in the context of the attorney-client privilege, ruling that colorable claims of privilege are a textbook example of the right to intervene as of right); Appeal of Hughes, 633 F.2d 282, 286 (3d Cir. 1980) ("The governing rule in these circumstances is that the possessor of the claimed privilege or right may intervene to assert it"). Discretionary intervention is also proper under Rule 24(b) because Mr. Epstein's interests in protecting his plea negotiations "share with the main action a common question of law or fact." FED. R. Civ. P. 24(b). That common question of law involves the privileged and confidential nature of Mr. Epstein's plea negotiations, and the unprecedented request of Jane Doc 1 and Jane Doe 2 to use those negotiations as evidence to vacate the product of Mr. Epstein's plea bargain. This is plainly prohibited by Rule 410, and for good reason. The "central feature" of Rule 410 is that "the accused is encouraged candidly to discuss his or her situation in order to explore the possibility of disposing of the case through a consensual arrangement." United States ! Herman, 544 F.2d 791, 797 (5th Cir. 1977). To allow Jane Doe 1 and Jane Doe 2 to now "introduce statements uttered in reliance on the rule would be to use the rule as a sword rather than a shield." Id. D. THE OBJECTION OF JANE DOE 1 AND JANE DOE 2 As required by Local Rule 7.1, we asked counsel for Jane Doc 1 and Jane Doe 2 whether they objected to Mr. Epstein's limited intervention. Counsel responded that they "oppose the motion on timeliness and other grounds." Mr. Epstein's motion is timely for the reasons set forth below. As to the "other grounds" that Jane Doe I and Jane Doe 2 may advance, counsel for both plaintiffs previously admitted that Mr. Epstein has a right to intervene. 2 EFTA00177879

Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2011 Page 3 of 9 First, they argued in their opposition to the intervention of attorneys Black, Weinberg, and Lefkowitz that Mr. Epstein "is the real party in interest" and that "harm from the release of the materials (if any) could be only to Jeffrey Epstein." Jane Doe 1 and Jane Doe 2's Response To Motion To Intervene of Roy Black, Martin Weinberg, and Jay Lefkowitz [DE 78] at 6. Second, also in opposing the intervention of attorneys Black, Weinberg, and Lefkowtiz, the plaintiffs argued that "[o]nly Epstein has an interest in the validity of the non-prosecution agreement . . . ." Jane Doe I and Jane Doe 2's Response To Motion To Intervene of Roy Black, Martin Weinberg, and Jay Lefkowitz [DE 78] at 4. And third, in their "Motion to Use Correspondence To Prove Violations of The Crime Victim 's Rights Act And To Have Unredacted Pleadings Unsealed," filed five months ago, Jane Doe 1 and Jane Doe 2 expressly state that they do not object to Mr. Epstein's timely intervention: The victims have no objection to Epstein intervening in this case — at this time. lf, however, Epstein delays intervention until after a reasonable period of time, the victims will argue that his motion to intervene is untimely. [DE 51 at 8]. III. MR. EPSTEIN'S MOTION To INTERVENE Is TIMELY We address at the outset what has not yet happened in this litigation: There has been no trial or adjudication on the merits of the claims and defenses, and this motion to intervene is not made on the eve of such trial. There is no final judgment that would be undone or affected by Mr. Epstein's intervention. Nor is a final judgment imminent given the discussions about discovery and related matters addressed during the August 12, 2011 hearing. There are no discovery cut off dates, and the motion to intervene is therefore not filed on the eve of such deadlines or after they have passed. 3 EFTA00177880

Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2011 Page 4 of 9 There have been no evidentiary hearings or factual findings by the Court that would be undone by the motion to intervene. Rather than impede the litigation, Mr. Epstein's participation will aid the Court in ruling on the sensitive and novel legal issues concerning plea negotiations. Finally, time is not of the essence to Jane Doe 1 and Jane Doe 2 — after all, they ignored this litigation for a year and a half while they pursued money damages against Mr. Epstein. The Court's order dismissing this case for lack of prosecution, which is dated September 8, 2010, noted that there had been no activity in the case since April 2009. [DE 38]. A motion to intervene must be timely. But "(t]imeliness is not a word of exactitude or of precise measurable dimensions . . . [T]imeliness is not limited to chronological considerations but is to be determined from all the circumstances." Stallworth 'Monsanto Co., 558 F.2d 257, 263-64 (5th Cir. 1977). Those circumstances are considered in light of four factors: I. The length of time during which the would-be intervenor actually knew or reasonably should have known of his interest in the case before he petitioned for leave to intervene. 2. The extent of the prejudice that the existing parties to the litigation may suffer as a result of the would-be intervenor's failure to apply for intervention as soon as he actually knew or reasonably should have known of his interest in the case. 3. The extent of the prejudice that the would-be intervenor may suffer if his petition for leave to intervene is denied. 4. The existence of unusual circumstances militating either for or against a determination that the application is timely. Id. 1. The length of time during which the would-be intervenor actually knew or reasonably should have known of his interest in the case before he petitioned for leave to intervene: Mr. Epstein's interests arose during the August 12, 2011 hearing, when the plaintiffs argued for the first time that their rights under the CVRA were violated not only by the government, but also by Mr. Epstein. Even though Mr. Epstein has no legal duties to the plaintiffs under the CVRA, the 4 EFTA00177881

Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2011 Page 5 of 9 plaintiffs argued at the hearing that Mr. Epstein was somehow responsible for the government's communications with each Jane Doe and that Mr. Epstein, a private citizen, caused the government to violate its obligations under the Act. According to the plaintiffs, Mr. Epstein "engineered" and "orchestrated" the claimed CVRA violations, and he "insisted that the rights of these victims" be violated. [Trans. August 12, 2011 at 33-34, 611. The plaintiffs argued that because of this supposed conspiracy between Mr. Epstein and the government, the plaintiffs are entitled to copies of all the plea negotiation letters and emails, to use them as evidence in these proceedings seeking invalidation of the Non-Prosecution Agreement. Id. at 33-34, 61, 107-09. When the plaintiffs articulated a supposed conspiracy directed by Mr. Epstein to use Assistant United States Attorneys to deny the plaintiffs their rights, it became clear that the plaintiffs' purpose in seeking the plea negotiations is to offer them as evidence against Mr. Epstein, in violation of Federal Rule of Evidence 410. This showed that Mr. Epstein's interests were being implicated in the ongoing litigation between the government and the Jane Does and that limited intervention was timely and warranted. 2. The extent of the prejudice that the existing parties to the litigation may suffer as a result of the would-be intervenor's failure to apply for intervention as soon as he actually knew or reasonably should have known of his interest in the case: Jane Doe 1 and Jane Doe 2 will suffer no prejudice if Mr. Epstein is allowed to intervene. As noted earlier, Jane Doc 1 and Jane Doe 2 ignored this case for a year and a half while they pursued claims for money damages against Mr. Epstein. They obviously do not view time as being of the essence and were in no hurry to litigate their claims, despite their knowledge that as of June 30, 2008 Mr. Epstein was in a county jail, and that as of the summer of 2009 he was serving a term of community control, which did not end until July of 2010. 5 EFTA00177882

Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2011 Page 6 of 9 Additionally, during the time period when the plaintiffs demonstrated no urgency and sought no expedited relief, Mr. Epstein, pursuant to his obligation under the Non-Prosecution Agreement, paid an attorney representative, Robert Josefsberg, substantial legal fees to represent many of the witnesses against him and settled many civil cases brought by the attorney representative. Mr. Epstein settled those cases in large part because one of the conditions of the Non-Prosecution Agreement was that Mr. Epstein waive certain defenses in civil litigation if certain identified plaintiffs sued him exclusively under the provisions of 18 U.S.C. § 2255. In short, Mr. Epstein met every condition of his Non-Prosecution Agreement with the U.S. Attorney's Office between June 30, 2008 and the Summer 2010, during which time there was inaction by the plaintiffs. Counsel for the plaintiffs are aware that the provisions of 18 U.S.C. § 3771(d)(3) & (5)(13) require that CVRA claims be raised and resolved on an exigent basis, and that litigation, including appeals from adverse rulings, be expedited in order to avoid the current circumstance, where a plaintiff seeks to invalidate an agreement after a citizen has fully served his sentence and has been subjected to a myriad of collateral and adverse consequences, none of which can be reversed. There is also no prejudice to the plaintiffs because there has been no trial or adjudication of the merits of the claims or defenses raised by the existing parties, depositions have not been taken, there have been no evidentiary hearings or factual findings by the Court, and there is no final judgment or decree that would be undone or affected by Mr. Epstein's intervention. In their"Motion to Use Correspondence To Prove Violations of The Crime Victim's Rights Act And To Have Unredacted Pleadings Unsealed," Jane Doc 1 and Jane Doe 2 argue that any motion to intervene by Mr. Epstein would be untimely if filed "after the date on which the government must respond to the victims' motion for a finding of violation of the CVRA," because 6 EFTA00177883

Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2011 Page 7 of 9 "that is when the victims must begin drafting a reply pleading." Id. This argument of inconvenience does not go far because many of the issues raised by Mr. Epstein parallel the issues raised by attorneys Black, Weinberg, and Letkowitz as well as those raised during the August 12, 2011 hearing, and Jane Doe 1 and Jane Doe 2 do not have to file their responsive pleadings addressing those issues for one more month.' Thus, by the time Jane Doe 1 and Jane Doe 2 would have to respond to the merits of Mr. Epstein's motion for a protective order, they will have already done most if not all of the work involved in addressing the common legal issues. Allowing Mr. Epstein to intervene will bring the plaintiffs no undue prejudice. 3. The extent of the prejudice that the would-be intervenor may suffer if his petition for leave to intervene is denied: The issues concerning Mr. Epstein's plea negotiations are significant. As both sides expressed to the Court during the hearing on August 12, 2011, there are no reported cases that address these precise facts. As far as we know, in our combined decades of experience as criminal defense attorneys, there has been no case where third parties in a civil case have sought to discover, much less use, plea negotiations as evidence to vacate the product of the client's plea bargain years after the client has served a prison sentence, served a year of community control, completed his entire sentence, and paid enormous sums of money to the attorney representing persons bringing or threatening to bring lawsuits against himfor money damages. To adjudicate these issues without Mr. Epstein's intervention would bring him irreparable harm, especially because if his plea negotiations are disclosed, Mr. Epstein will forever lose the benefit of their confidentiality and ' The government has two weeks to respond to the supplemental brief to be filed by attorneys Black, Weinberg, and Leflcowitz, and Jane Doe 1 and Jane Doe 2 then have two weeks after that to file their response. [DE 91 & 92]. 7 EFTA00177884

'Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2011 Page 8 of 9 privilege. 4. The existence of unusual circumstances militating either for or against a determination that the application is timely: At least two unusual circumstances militate for a determination that the motion to intervene is timely and should be granted. First, the plaintiffs ignored this case for a year and a half, waiting until this Court dismissed it for lack of prosecution to pay it any attention. Their main concern during all that time was their claims for money against Mr. Epstein. They can now hardly complain that Mr. Epstein's motion to intervene is untimely. Second, the Court's ruling on the issues concerning Mr. Epstein's plea negotiations will reach far beyond the parties in this case and will impact every criminal investigation and prosecution in this and other Districts. Releasing the plea negotiation letters and cmails and using them as evidence to invalidate the bargain itself, as Jane Doe 1 and Jane Doe 2 request, will chill the ability of lawyers and clients to engage in candid plea discussions with the government. This will ultimately crowd the dockets of the district courts, where judges rely on plea negotiations to dispose of 96.1% of all criminal cases? The ruling urged by Jane Doe 1 and Jane Doe 2 will also shift the ethical and constitutional obligations of all criminal defense attorneys, because few criminal defense lawyers would consider entering into plea discussions and making candid written statements during plea negotiations if those statements are later discoverable and could be used against the client in a yet- unfiled lawsuit by yet-unknown plaintiffs at some unknown time in the future. No lawyer would agree to have open discussions with a prosecutor about resolving a criminal matter or to make 2 The Bureau of Justice Statistics of the Department of Justice reports that as of 2005, only 3.9% of all federal criminal cases proceed to trial. These statistics are reported at www.oip.usdoi.gov/bis/pub/html/fisst/2005/fis05st.him. 8 EFTA00177885

Case 9:08-cv-80736-KAM Document 93 Entered on FLSD Docket 09/02/2011 Page 9 of 9 written submissions of their positions and views of the evidence and law, if plea negotiations could be used to damage a client in a future civil case. With these additional serious interests at stake, the motion to intervene should not be denied as untimely. IV. CONCLUSION Mr. Epstein's motion for a limited intervention is timely and should be granted as of right under Rule 24(a) or, alternatively, as a matter within the Court's discretion under Rule 24(b). If allowed to intervene, Mr. Epstein would file the attached motion for a protective order in response to the motion of Jane Doe 1 and Jane Doe 2 for disclosure of the defense plea negotiation letters and emails [DE 50 at 5], their motion to use these letters and emails as substantive evidence in their quest to invalidate the Non-Prosecution Agreement [DE 51], and their motion to disseminate the letters and emails to the media [DE 51 at 7]. We certify that on September 2,2011, the foregoing document was filed electronically with the Clerk of the Court using the CM/ECF system. Respectfully submitted, BLACK, SREBNICIC, KORNSPAN & STUMPF, P.A. 201 South Biscayne Boulevard Suite 1300 Miami, Florida 33131 Office: (305) 371-6421 Fax: (305) 358-2006 By /S/ ROY BLACK, ESQ. Florida Bar No. 126088 JACKIE PERCZEK, ESQ. Florida Bar No. 0042201 On Behalf of Jeffrey Epstein 9 EFTA00177886

Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 1 of 24 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE No. 08-80736-CIV-MARRA/JOHNSON JANE DOE 1 and JANE DOE 2, Plaintiffs, EXHIBIT A UNITED STATES OF AMERICA, Defendant. INTERVENOR JEFFREY EPSTEIN'S MOTION FOR A PROTECTIVE ORDER AND OPPOSITION TO MOTIONS OF JANE DOE I AND JANE DOE 2 FOR PRODUCTION, USE, AND DISCLOSURE OF PLEA NEGOTIATIONS Pursuant to Federal Rules of Evidence 410 and 501, Federal Rule of Criminal Procedure 11, and the Constitutional right to effective assistance of counsel, Jeffrey Epstein opposes the motion of Jane Doe 1 and Jane Doe 2 for disclosure of all the plea negotiation letters and cmails between his lawyers and federal prosecutors during the criminal investigation [DE 50 at 5]. Mr. Epstein also opposes the motion of Jane Doe 1 and Jane Doe 2 to use these plea negotiations as substantive evidence in their quest to invalidate the Non-Prosecution Agreement [DE 51], as well as their motion to disseminate the plea negotiations to the media [DE 51 at 7]. Established case law as well as sound and substantial policy considerations prohibit disclosure of the letters and emails prepared by Mr. Epstein's lawyers during plea negotiations with the government, and require that the letters and emails that Janc Doe 1 and Jane Doe 2 already have remain confidential. Mr. Epstein adopts all the arguments advanced by proposed intervenors Black, Weinberg, and Lefkowitz in their motion to intervene and attached motion for a protective order [DE 56], as well as during the August 12, 2011 hearing. EFTA00177887

Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/0212.011 Page 2 of 24 In further support of his position, Mr. Epstein submits this motion and memorandum of law. Part I shows that the Court should deny disclosure and use of the plea negotiations by simple reference to Rule of Evidence 410 and Federal Rule of Criminal Procedure I l(f), without having to reach the other issues raised by the parties and the proposed intervenors. This is because during the hearing on August 12, 2011, Jane Doe 1 and Jane Doe 2 admitted that they intend to use the plea negotiation letters and emails as substantive evidence at a "remedies hearing" where they will seek invalidation of Mr. Epstein's Non-Prosecution Agreement. Using this correspondence as evidence against Mr. Epstein is plainly prohibited by Evidence Rule 410 and Criminal Rule II. Part II of this memorandum shows that Jane Doe 1 and Jane Doe 2 are not entitled to discovery or use of the plea negotiations not only because of the reach of Rules 410 and 11, but also because plea negotiations enjoy an evidentiary privilege as recognized by the Supreme Court in United States I Mezzanatto, 513 U.S. 196, 204 (1995) ("Rules 410 and 11(e)(6) 'creat[e], in effect, a privilege of the defendant,' and, like other evidentiary privileges, this one may be waived or varied at the defendant's request"). Additionally, because plea negotiations are "rooted in the imperative need for confidence and trust," and because their confidentiality serves significant public and private ends, they are properly subject to a common law privilege under Federal Rule of Evidence 501. Similar privileges, which are "rooted in the imperative need for confidence and trust" and which serve significant public and private ends, have been recognized by Judge Marcus in the case of In Re Air Crash Near Cali, Colombia, 959 F. Supp. 1529 (S.D. Fla. 1997); by Chief Judge Vinson of the Northern District of Florida in Reichhold Chemicals, Inc.. Textron, Inc., 157 F.R.D. 522 (N.D. Fla. 1994); and by a number of district courts recognizing a mediation privilege which shields from disclosure and use mediation documents, letters, and communications. 2 EFTA00177888

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 3 of 24 Finally, in response to the Court's question during the August 12, 2011 hearing, Part III establishes that Mr. Epstein has standing under Federal Rule of Criminal Procedure 6(e) to object to disclosure of matters occurring before the grand jury. PART I A. PLEA NEGOTIATIONS MAY NOT BE USED AGAINST MR. EPSTEIN UNDER THE PLAIN LANGUAGE OF THE FEDERAL RULES The Court should deny disclosure and use of the plea negotiations by simple reference to Rule of Evidence 410 and Rule of Criminal Procedure 11(f), without having to reach the other issues raised by the parties and the proposed intervenors. During the August 12, 2011 hearing, the plaintiffs admitted that they seek the defense letters and emails to offer them as evidence to support their request that the Court invalidate Mr. Epstein's Non-Prosecution Agreement. According to the plaintiffs, the plea negotiations will show that Mr. Epstein supposedly "engineered" and "orchestrated" the claimed Crime Victims' Rights Acts violations and that therefore the plaintiffs are entitled to negate Mr. Epstein's interest in the protections and finality of the Non-Prosecution Agreement. [August 12, 2011 Trans. at 33-34, 61, 107-09]. The letters and cmails exchanged between the government and defense counsel during plea negotiations are classic settlement discussions, written with the intention that they remain confidential. As such, they are protected by the constitutional right to effective assistance of counsel and the express language of Rule 410 and Federal Rule of Criminal Procedure 11(f). FED. R. EvID. 410 (discussions made during plea negotiations are "not, in any civil or criminal proceeding, admissible against the defendant who ... was a participant in the plea discussions"); FED. R. CRIM. P. 11(0 ("the admissibility or inadmissibility of.. . a plea discussion and any related statement is 3 EFTA00177889

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 4 of 24 governed by Federal Rule of Evidence 410"). Obviously, the plaintiffs intend to use the plea negotiation letters "against" Mr. Epstein. They protested during the August 12 hearing that the letters would be offered "against the government" and "not against Mr. Epstein," but this is disingenuous given their emphatic and categorical representations to the contrary. [Compare Trans. at 29-30 with Trans. at 33-34, 61, 107- 09]. The plaintiffs' arguments and accusations throughout this litigation, including the various conspiracy allegations leveled against Mr. Epstein during the August 12 hearing, establish that the plaintiffs' true purpose is to use the plea negotiations against Mr. Epstein in the current proceeding. The prohibition on admission of plea negotiation communications clearly extends to the current proceeding, whether it is denominated a quasi-criminal or a civil proceeding. The committee notes to former Rule 11(e)(6), which read almost identical to Rule 410, specifically state that the words "not . admissible against the defendant" refer to "the purpose for which [the evidence] is offered" and not "to the kind of proceeding in which the evidence is offered." FED. R. CRIM. PRO. 11 advisory committee note 1979 amendment (emphasis added). Rule 11 was amended in 1979 specifically to avoid confusion or misunderstanding regarding this phrase, and to emphasize that "against the defendant" means "the purpose" for which the evidence is being used: The phrase "in any civil or criminal proceeding" has been moved from its present position, following the word "against," for purposes of clarity. An ambiguity presently exists because the word "against" may be read as referring either to the kind of proceeding in which the evidence is offered or the purpose for which is offered. The change makes it clear that the latter construction is correct. Committee on Rules of Practice And Procedure of The Judicial Conference of The United States, Standing Committee On Rules of Practice And Procedure, 77 F.R.D. 507, 538 (February 1978) (emphasis added). 4 EFTA00177890

•Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 5 of 24 Even though the plaintiffs claim that they would technically offer the plea negotiation letters against the government because the government is its opponent, their real and express purpose is to offer the plea negotiations against Mr. Epstein to prove his supposed culpability in encouraging the government to breach what the plaintiffs contend is their statutory right to consultation, and to then seek the unprecedented and unconstitutional remedy of invalidation of the Non-Prosecution Agreement despite the fact that Mr. Epstein has already suffered all of its penal and adverse collateral consequences: jail, community custody, payment of substantial legal fees to an attorney representative for his accusers, payment of substantial civil settlements driven by waivers negotiated by the government to facilitate its witnesses bringing successful civil lawsuits, and registration requirements. Rules 410 and 1 I plainly prohibit admission of the plea communications. B. BECAUSE PLEA NEGOTIATIONS ARE INADMISSIBLE, THE PLAINTIFFS BEAR THE BURDEN OF PARTICULARIZING A PROPER BASIS FOR DISCOVERY When a discovery request seeks "information subject to exclusion under the Federal Rules of Evidence, such as settlement information, ... many courts shift the burden to the requesting party, requiring them to make a particularized showing that the inadmissible evidence is likely to lead to admissible evidence." Reistl. Source Interlink Co., 2010 WL 4940096 at *2 (M.D. Fla. Nov. 29, 2010); Bottarol. Hatton Assocs., 96 F.R.D. 158, 159-60 (E.D.N.Y. 1982) ("the object of the inquiry must have some evidentiary value before an order to compel disclosure of otherwise inadmissible material will issue"). Such a burden-shifting analysis is particularly important where the discovery is protected by a rule of inadmissibility, where the plaintiffs have not identified any principled basis for discovery other than to seek to admit the plea communications in evidence, and where the 5 EFTA00177891

Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 6 of 24 policies behind the rule of inadmissibility would be compromised by any disclosure, regardless of whether the communications are later excluded as evidence in proceedings in this case. The plaintiffs in Bottaro sued a number of defendants for securities fraud. One defendant settled and was dismissed from the lawsuit. The remaining defendants later moved to compel disclosure of the settlement agreement. In denying the motion to compel, the Court recognized the strong public policy favoring settlements, and the need to encourage settlements by ensuring against "unnecessary intrusion" into "the bargaining table." Id. at 160. For this reason, the Court held, parties seeking discovery of inadmissible settlement negotiations must first make a "particularized showing of a likelihood that admissible evidence will be generated" by their discovery request: Given the strong public policy of favoring settlements and the congressional intent to further that policy by insulating the bargaining table from unnecessary intrusions, we think the better rule is to require some particularized showing of a likelihood that admissible evidence will be generated by the dissemination of the terms of a settlement agreement. Since the terms of settlement do not appear to be reasonably calculated to lead to discovery of admissible evidence and the defendants have not made any showing to the contrary, this justification for [discovery] must fail. Id.; accord Reist, 2010 WL 4940096 at *2 (recognizing the "chilling effect" that discovery can have on the willingness of parties to enter into settlement negotiations). Other than their conclusory statement during the August 12 hearing that the plea negotiations would be used against the government and not Mr. Epstein, the plaintiffs have not made any particularized showing to convince this Court that any admissible evidence would result from their discovery of the plea negotiations. Accordingly, their request for discovery of clearly inadmissible evidence should be denied. 6 EFTA00177892

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 7 of 24 C. THE PLEA NEGOTIATIONS ARE IRRELEVANT BECAUSE THE PLAINTIFFS ARE NOT ENTITLED TO INVALIDATE THE NON-PROSECUTION AGREEMENT Additionally, the purpose for which the plaintiffs seek the plea negotiation letters — to set aside the Non-Prosecution Agreement— is a remedy that, if granted, would violate the Constitution and the statutory rights of both the government and Mr. Epstein. It would also be extraordinarily inequitable given that while the plaintiffs failed to urge that this Court resolve their Complaint as an exigent or emergency matter, Mr. Epstein served the entirety of a prison sentence that resulted from obligations imposed upon him by the Non-Prosecution Agreement. He also served the entire community control consecutive sentence, and pursuant to the Non-Prosecution Agreement, he made payments of huge sums of money to the attorney representative of certain claimants. Finally, Mr. Epstein settled cases because of waivers within the Non-Prosecution Agreement. Under the Crime Victims' Rights Act, neither Jane Doe 1 nor Jane Doe 2 can invalidate the Non-Prosecution Agreement. The Act expressly prohibits it: "Nothing in this chapter shall be construed to impair the prosecutorial discretion of the Attorney General or any officer under his direction." 18 U.S.C. § 3771(dX6). The Act codifies the long-standing principle that "[t]he Attorney General and United States Attorneys retain broad discretion to enforce the Nation's criminal laws." United States. Armstrong, 517 U.S. 456, 464 (1996). This is due in large part to the separation of powers doctrine. Id.; U.S. CONST. art. II, § 3. Whether to investigate possible criminal conduct, grant immunity, negotiate a plea, or dismiss charges, are all central to the prosecutor's executive function. United Stalest Smith, 231 F.3d 800, 807 (11th Cir. 2000). "The judiciary cannot interfere with a prosecutor's charging discretion, except in narrow circumstances where it is necessary to do so in order to 7 EFTA00177893

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 8 of 24 discharge the judicial function of interpreting the Constitution." Id. And this Court has not been called upon to interpret the Constitution. Even in the case of In re Dean, 527 F.3d 391 (5th Cir. 2008), upon which the plaintiffs rely, the district court, after remand from the Fifth Circuit, denied the motion of the victims to invalidate the defendant's plea agreement as a remedy for the claimed violation of the Crime Victims' Rights Act. The court found that "[t]he purpose of the conferral right is not to give the victims a right to approve or disapprove a proposed plea in advance or to participate in plea negotiations." In re Dean on remand as United States'. BP Products North America, Inc., 610 F. Supp. 2d 655, 727 (S.D. Tex. 2009). Instead, "[tjhe purpose of the reasonable right to confer is for victims to provide information to the government, obtain information from the government, and to form and express their views to the government and court." Id. The district court concluded that the violations alleged by the victims did not provide a basis for rejecting the plea agreement. Id. at 726-27; see In re Acker, 596 F.3d 370, 373 (6th Cir. 2010) (denying mandamus where petitioners sought to vacate plea agreement which made no provision for restitution in deference to pending civil litigation); United Stalest Aguirre-Gonzalez, 597 F.3d 46 (1st Cir. 2010) (relying on the "strong interest in the finality of criminal sentences" to reject mandamus under the Act where a defendant had pleaded guilty and had been sentenced more than two years earlier); see also United States'. Bedonie, 413 F.3d 1126, 1129-30 (10th Cir. 2005) (district court had no authority under mandatory restitution act to reopen restitution proceedings after sentencing). More recently in the case of In re Peterson, No. 2:10-CV-298, 2010 WL 5108692 (N.D. Ind. Dec. 8, 2010), the district court denied reliefunder the Crime Victims' Rights Act before any charges were filed. The court recognized that the Act "guarantees crime victims a range of substantive and 8 EFTA00177894

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 9 of 24 participatory rights," but that "[w]hether charges might be filed and proceedings initiated in the future is a matter of prosecutorial discretion, and the [Act] expressly provides that [n]othing in this chapter shall be construed to impair the prosecutorial discretion of the Attorney General or any office under his direction.'" M. at •2 (quoting 18 U.S.C. § 3771(dX6)). For these reasons, the Court should deny the motion of Jane Doe I and Jane Doe 2 to discover and use the plea negotiation letters as evidence. PART 11 MR. EPSTEIN'S PLEA NEGOTIATIONS ARE PRIVILEGED AND NOT DISCOVERABLE UNDER RULE 501 Jane Doe 1 and Jane Doe 2 are also not entitled to discovery or use of the plea negotiations because plea negotiations enjoy an evidentiary privilege, as recognized by the Supreme Court in United States'. Mezzanatto, 513 U.S. 196 (1995). Additionally, because plea negotiations are "rooted in the imperative need for confidence and trust," and because their confidentiality serves significant public and private ends, they are properly subject to a common law privilege under Federal Rule of Evidence 501. That Rule provides, in relevant part: Except as otherwise required by the Constitution of the United States or provided by Act of Congress or in rules prescribed by the Supreme Court pursuant to statutory authority, the privilege of a witness, person, government, State, or political subdivision thereof shall be governed by the principles of the common law as they may be interpreted by the courts of the United States in the light of reason and experience. FED. R. EVID. 501. This Court "has the power to recognize new privileges, consistent with Rule 501 of the Federal Rules of Evidence, in cases arising under federal law." In Re Air Crash Near Cali, Colombia, 959 F. Supp. 1529, 1533 (S.D. FL. Feb. 7, 1997). 9 EFTA00177895

. Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 10 of 24 A. "REASON AND EXPERIENCE" ARE THE TOUCHSTONES FOR ACCEPTING A COMMON LAW PRIVILEGE FOR PLEA NEGOTIATIONS Jaffee v. Redmond, 518 U.S. 1 (1996), is perhaps the leading case addressing Rule 501 and the common-law principles underlying the recognition of testimonial privileges. The case involved a police officer and the extensive counseling she received after a traumatic incident in which she shot and killed a man. She was sued by the man's estate, which demanded discovery of the notes taken by the clinical social worker who provided therapy. Id. at 5-6. The officer and the therapist objected and asserted that their sessions were privileged, but the district court disagreed. The Seventh Circuit reversed and concluded that "reason and experience," which are "the touchstone for acceptance of a privilege under Federal Rule of Evidence 501r compelled recognition of a privilege between patient and psychotherapist. Id. "Reason tells us that psychotherapists and patients share a unique relationship, in which the ability to communicate freely without fear of public disclosure is the key to successful treatment." Id. The Seventh Circuit also observed that even though a number of older federal decisions had previously rejected the privilege, things had changed in the intervening years and the "need and demand for counseling" had "skyrocketed during the past several years." Id. The Supreme Court accepted certiorari to resolve a conflict among the Circuits, and affirmed the finding of a privilege. The Court's analysis was grounded "in the light of reason and experience," which showed that a therapist's ability to help a patient "is completely dependent" upon the patient's "willingness and ability to talk freely." Id. at 10, quoting Advisory Committee's Notes to Proposed Rules, 56 F.R.D. 183, 242 (1972). The Court found that the psychotherapist-patient privilege is "rooted in the imperative need for confidence and trust" and that "the mere possibility 10 EFTA00177896

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 11 of 24 of disclosure may impede the development of the confidential relationship necessary for successful treatment." Id. at 10. FollowingJaffee, three important sets of decisions have recognized privileges under Rule 501 to protect information that is exchanged in an environment that encourages candid disclosures, and that depends on this open exchange of information to promote significant private and public interests. They are: the decision of Judge Marcus, before he was appointed to the Eleventh Circuit, denying discovery and recognizing a privilege for airline pilots who report incidents and violations, In Re Air Crash Near Cali, Colombia, 959 F. Supp. 1529 (S.D. Fla. 1997); the decision of Judge Vinson, now the Chief Judge in the Northern District of Florida, denying discovery and recognizing a privilege for a corporation that reports contamination and other environmental hazards and violations to the Florida Department of Environmental Regulation, Reichhold Chemicals, Inc.'. Textron, Inc., 157 F.R.D. 522 (N.D. Fla. 1994); and a number of district court decisions denying discovery and recognizing a mediation privilege where litigants can "rely on the confidential treatment of everything that transpires during mediation ... ." Lake Utopia Paper Ltd.l. Connelly Containers, Inc., 608 F.2d 928 (2d Cir.1979); Folb I. Motion Picture Ind. Pension & Health Plans, 16 F. Supp. 2d 1164, 1173 (C.D.Ca. 1998); Sheldon I. Pennsylvania Turnpike Comm 'n, 104 F. Supp. 2d 511, (W.D. Pa. 2000); Microsoft Corporation. Suncrest Enterprise, 2006 WL 929257 (N.D. Cal. Jan. 6, 2006). 1. Judge Marcus and The Common Law Privilege Of Pilots Reporting Incidents And Violations, In Re Air Crash Near Cali, Colombia, 959 F. Supp. 1529 (S.D. Fla. 1997) In re Air Crash Near Cali, Colombia involved the crash of an American Airlines plane as it arrived in Cali just before Christmas, 1995. The crash killed 159 passengers and crew members. One hundred and thirty lawsuits were consolidated before Judge Marcus, and a steering committee 11 EFTA00177897

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 12 of 24 was created to represent the plaintiffs. 959 F. Supp. at 1530. During discovery, American Airlines refused to produce a number of responsive documents, asserting that they were privileged because they were prepared pursuant to the American Airlines Safety Action Partnership Program, known as the ASAP program. The program was an initiative by the FAA, the Allied Pilots Association, and American Airlines. It was a "voluntary pilot self-reporting program designed to encourage pilots to report incidents and violations." Id. at 1531. The objectives of the ASAP program were "to identify and to reduce or eliminate possible flight safety concerns, as well as to minimize deviations from Federal Aviation Regulations." Id. Judge Marcus agreed that American Airlines had made "a • compelling argument for recognition of a limited common law privilege for the ASAP materials." Id. at 1533. Relying on Jaffee, Judge Marcus found that he had the ability "to recognize new privileges, consistent with Rule 501 of the Federal Rules of Evidence, in cases arising under federal law." Id. He addressed the following four factors: First, the "private interests" involved — "in other words, whether dissemination of the information will chill the 'frank and complete disclosure of facts' shared in an 'atmosphere of confidence and trust."' Id. at 1533. Judge Marcus found that American Airlines, the pilots, and the FAA had an interest in air safety and in encouraging the flow of safety information. The FAA, as the regulatory body, also had an interest in being made aware of violations. Id. at 1534. Second, Judge Marcus considered the "public interests" furthered by the proposed privilege and found that there was a compelling public interest in improving the safety of commercial flights. Third, the "likely evidentiary benefit that would result from the denial of the privilege." Id. Judge Marcus did not find a benefit from denying the privilege. On the contrary, he agreed that 12 EFTA00177898

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 13 of 24 violations would be "kept secret if the pilots believed that their reports might be used in litigation or otherwise disseminated to the public." Id. Judge Marcus also agreed that failure to recognize the privilege would "reduce the willingness of pilots to report incidents" and would "seriously damage and probably terminate a uniquely successful safety program ... [which] relies on an assumption of strict confidentiality." Id. at 1534. He concluded that "without a privilege, pilots might be hesitant to come forward with candid information about in-flight occurrences, and airlines would be reluctant, if not altogether unwilling, to investigate and document the kind of incidental violations and general flight safety concerns whose disclosure is safeguarded by the ASAP program." Id. Finally, Judge Marcus warned that absent a privilege, "the prospect of ASAP reports being used by adverse parties in the course of litigation undoubtedly will affect the content, timeliness and candor of the reports submitted by its pilots." Id. Fourth, whether the privilege had been recognized by the states. Id. The Court was not aware of any state or federal court that had recognized the privilege claimed by American Airlines, but that did not dissuade him from finding that a privilege existed. With all these considerations in mind, Judge Marcus ruled that "[t]here is a genuine risk of a meaningful and irreparable chill from the compelled disclosure of ASAP materials in connection with the pending litigation." Id. at 1534. Likewise in Mr. Epstein's case, there is a genuine risk of a meaningful and irreparable chill from the compelled disclosure of plea negotiations in connection with the pending litigation. Significant private interests support a plea negotiations privilege. It cannot be denied that defendants, prosecutors, the court system, victims, and law enforcement agencies all have a legitimate interest that criminal cases or investigations resolve by pleas. Plea negotiations benefit 13 EFTA00177899

Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 14 of 24 defendants by limiting their exposure to jail or other punishment; they benefit all the parties in the system by avoiding the many expenses associated with jury trials; they benefit the court by keeping the flow of its dockets and making judges available to handle matters that are proceeding to trial or that are contested; and they benefit prosecutors and law enforcement not only by freeing their time so that they can focus on contested matters, but also by allowing them to debrief defendants and gather information about criminal activity. The public interests in criminal cases resolving by way of plea negotiations also cannot be denied. The public has an interest in the finality of plea negotiations, in ensuring that the courts, prosecutors, and law enforcement agencies are available to dedicate their time to contested matters, and in information that may be provided by defendants that will help curb criminal activity in their communities. The public, as well as private victims and government entities, all have an interest in restitution. There are significant evidentiary consequences if the Court denies a privilege to plea negotiations. As with air safety violations that would be "kept secret if pilots believed their reports might be used in litigation," defendants and people under criminal investigation would not engage in plea negotiations and waive their Fifth Amendment rights if they believed that statements made during those negotiations could be used against them later in litigation with third parties. Candid discussions simply cannot take place if defendants fear that statements made during negotiations can be divulged to third parties in other proceedings and used to harm them, send them to prison, or invalidate their bargains years after they have served prison sentences and suffered all the consequences of their deals. Just as the work-product privilege is created, in part, to encourage lawyers to keep notes without fear of disclosure, a privilege for plea communications is necessary 14 EFTA00177900

Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 15 of 24 to encourage lawyers to communicate, in writing, without fear that their proposals, submissions, arguments, analysis of the facts, or legal arguments will become the grist of later civil litigation to the potential detriment to the client. Few if any lawyers would engage in candid and open discussions with a prosecutor if their statements could later be used against their clients. The ethical and constitutional obligations we now have to initiate and engage in plea negotiations would be terribly at odds with any rule that made those negotiations public and admissible in evidence to be used as ammunition to harm our clients. 2. Chief Judge Vinson and the Common Law Privilege Of Reporting Environmental Hazards and Violations, Reichhold Chemicals, Inc.'. Textron, Inc., 157 F.R.D. 522 (N.D. Ha. 1994) Reichhold Chemicals involved a Consent Order between Reichhold and the Florida Department of Environmental Regulation. The Order obligated Reichhold "to investigate and remediate the contamination of groundwater on and under, and storm water runoff from, an industrial plant site it owns in Pensacola, Florida." 157 F.R.D. 523-24. Reichhold brought an action against former owners of the plant site, to recover some of the cost of remediating the land. The defendants sought reports that Reichhold had prepared describing possible environmental violations. Reichhold asserted that these documents were protected by "the privilege of self-critical analysis." Id. at 524. This privilege, "also known as the self-evaluative privilege," had been adopted in other jurisdictions, but at the time, it presented an issue of first impression to Chief Judge Vinson. He ruled in favor of Reichhold and found that the privilege allows individuals and companies to candidly assess their compliance with legal requirements without creating evidence to be later used against them by their adversaries: 15 EFTA00177901

Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 16 of 24 The self-critical analysis privilege has been recognized as a qualified privilege which protects from discovery certain critical self-appraisals. It allows individuals or businesses to candidly assess their compliance wi In regulatory and legal requirements without creating evidence that may be used against them by their opponents in future litigation. The rationale for the doctrine is that such critical self-evaluation fosters the compelling public interest in observance of the law. Id. at 524. Judge Vinson agreed with Reichhold that the privilege was necessary to protect an organization or individual from the Hobson's choice °feistier undertaking an aggressive investigation and correcting dangerous conditions, "thereby creating a self-incriminating record that may be evidence of liability," or "deliberately avoiding making a record on the subject (and possibly leaving the public exposed to danger) in order to lessen the risk of civil liability." Id. In recognizing the privilege, Judge Vinson relied on Bredice'. Doctor's Hospital, Inc., 50 F.R.D. 249 (D.D.C.1970), the first case to find a common law self-evaluation privilege. There, the hospital held staff meetings where the professional staff evaluated the treatment provided to patients. In a medical malpractice action, the estate of Bredice sought the minutes of the hospital's staff meetings where Bredice's treatment or death were discussed. The court denied the discovery, noting that "review of the effectiveness and results of treatments were valuable in improving the quality of health care available to the general public," and that "physicians would be unwilling to candidly critique the actions of their colleagues if such evaluations were subject to discovery and use as evidence in a subsequent malpractice action." Id. at 525. 3. The Common Law Mediation Privilege As is true in the case of plea negotiations, it seems self-evident that no system of mediation can function if parties fear that statements made and documents submitted in furtherance of mediation create a trail of incrimination that cah later be used against them. "[C]ounsel, of necessity, 16 EFTA00177902

• Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 17 of 24 [would] feel constrained to conduct themselves in a cautious, tight-lipped, noncommittal manner more suitable to poker players in a high-stakes game than adversaries attempting to arrive at a just solution of a civil dispute." Lake Utopia Paper Ltd.'. Connelly Containers, Inc., 608 F.2d 928 (2d Cir.1979). Lake Utopia involved the Second Circuit's Civil Appeals Management Plan, which called for parties to engage in a conference before oral argument, to hopefully settle their dispute. The Circuit adopted this mediation program to encourage the parties to settle, and to expedite the processing of civil appeals. Id. at 929. Counsel for the parties in Lake Utopia met pursuant to the program in an attempt to settle. The appellee later disclosed to the Court certain admissions made during the conference which showed that the appeal was frivolous. Rather than embrace this information, the Court chastised the appellee for disclosing it, holding that the purpose of the conference program was to encourage the parties to settle, and that the program would not function if statements made during the conference were later used against the parties. "It is essential to the proper functioning of the Civil Appeals Management Plan that all matters discussed at these conferences remain confidential. The guarantee of confidentiality permits and encourages counsel to discuss matters in an uninhibited fashion often leading to settlement . ." Id. at 930. Ten years later, in Folb'. Motion Picture hid. Pension & Health Plans, 16 F. Supp. 2d 1164, (C.D.Ca. 1998), the district court in California became the first federal court to adopt the mediation privilege as federal common law under Rule 501. Relying on Lake Utopia Paper as well as a number of other decisions addressing the confidentiality of settlement negotiations, Folb held that "the need for confidentiality and trust between participants in a mediation proceeding is sufficiently 17 EFTA00177903

. Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 18 of 24 imperative to necessitate the creation of some form of privilege." Id. at 1175. The court emphasized that the mediation privilege is particularly important because federal courts rely on mediation to manage their dockets: "This conclusion takes on added significance when considered in conjunction with the fact that many federal district courts rely on the success of ADR proceedings to minimize the size of their dockets." Id. More recently in Sheldonel. Pennsylvania Turnpike Comm'n, 104 F. Supp. 2d 511, (W.D. Pa. 2000), the court relied on Jaffee and on Judge Marcus' decision in In re Air Crash Near Cali, Colombia to hold that all mediation documents and mediation communications are privileged and not subject to discovery. Mediation "afford[s] to litigants an opportunity to articulate their position[s] and to hear, first hand, both their opponent's version of the matters in dispute and a neutral assessment of the relative strengths of the opposing positions." Id. at 513. Without a mediation privilege, "parties and their counsel would be reluctant to lay their cards on the table so that a neutral assessment of the relative strengths and weaknesses of their opposing positions could be made." Id. This, of course, assumes that parties "would even agree to participate in the mediation process absent confidentiality." Id. Confidentiality is therefore "essential to the mediation process," and it is "beyond doubt that the mediation privilege is rooted in the imperative need for confidence and trust." Id. at 514. No real distinction exists between the need to keep mediation confidential and the need to keep plea negotiations confidential. Both processes, and the goals they serve, are essentially identical. Both processes aim at encouraging settlement and compromise. Both processes depend on parties speaking candidly about the strengths and weaknesses of their positions. And in both processes, it would be manifestly unfair to require that parties attempt to settle their disputes in this 18 EFTA00177904

. Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 19 of 24 fashion, only to later allow third parties to use their words as a weapon against them. B. THE COURT SHOULD RECOGNIZE A PLEA NEGOTIATIONS PRIVILEGE The "central feature" of Rule 410 "is that the accused is encouraged candidly to discuss his or her situation in order to explore the possibility of disposing of the case through a consensual arrangement." United States'. Herman, 544 F.2d 791, 797 (5th Cir. 1977). The Rule is derived from "the inescapable truth that for plea bargaining to work effectively and fairly, a defendant must be free to negotiate without fear that his statements will later be used against him." Id. at 796. The legislative history, too, "shows that the purpose of Fed.R.Ev. 410 and Fed.R.Crim.P. 1 I (c)(6) is to permit the unrestrained candor which produces effective plea discussions between the . . . government and the . . . defendant." Committee on Rules of Practice And Procedure of The Judicial Conference of The United States, Standing Committee On Rules of Practice And Procedure, 77 F.R.D. 507 (February 1978) (emphasis added).' For these reasons, criminal defense lawyers negotiate with prosecutors in an environment of confidentiality, fostered by the protections of Rules 4 I 0 and I I. These rules encourage a process of searching and honest disclosures, and parties expect that their negotiations, and the information they exchange, will be protected from future use by an adversary. And because criminal defense lawyers arc required, by ethical and constitutional considerations, to engage in plea negotiations to discharge their duty to represent the client's best interest, they do so with the well-founded expectation that communications made during those negotiations will not later be used to harm the client. Rule 11(0 was formerly Rule I 1(e)(6), which read almost identical to Rule 410. 19 EFTA00177905

Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 20 of 24 1. The Court Should Recognize A Plea Negotiations Privilege Because Plea Negotiations Are Critical To The Criminal Justice System The Supreme Court has recognized that "Rules 410 and 11(eX6) 'creat[e], in effect, a privilege of the defendant...."' Mezzanatto, 513 U.S. at 204.This privilege encourages disposition of criminal cases by plea agreement, which is essential to the administration of justice: The disposition of criminal charges by agreement between the prosecutor and the accused, sometimes loosely called "plea bargaining," is an essential component of the administration of justice. Properly administered, it is to be encouraged. If every criminal charge were subjected to a full-scale trial, the states and the federal government would need to multiply by many times the number ofjudges and court facilities. Santobellol. New York, 404 U.S. 257, 260 (1971). "[T]he fact is that the guilty plea and the often concomitant plea bargain are important components of this country's criminal justice system. Properly administered, they can benefit all concerned." Blackledge I. Allison, 431 U.S. 63, 71 (1977). Those sentiments are just as true today. The Bureau of Justice Statistics of the Department of Justice reports that in 2005, 96.1% of federal criminal cases were resolved by way of a plea bargain. www.oia.usdoi.gov/bis/pub/htmlifisst/2005/fis05st.htm That today's justice system depends on plea negotiations is a monumental understatement. 2. The Court Should Recognize A Plea Negotiations I'rivilege Because Plea Negotiations Are Critical To The Effective Representation of Counsel Whether to negotiate a plea or contest a criminal charge "is ordinarily the most important single decision in any criminal case." Borial. Keane, 99 F.3d 492 (2d Cir. 1996). In the age of the Sentencing Guidelines, with the draconian sentences called for in federal criminal cases, minimum mandatories, and the abolition of parole, engaging in meaningful and effective plea negotiations is 20 EFTA00177906

. Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 21 of 24 perhaps one of the most important roles of a criminal defense attorney. Today, the lawyer's "ability to persuade the judge or the jury is ... far less important than his ability to persuade the prosecutor" during plea negotiations. United States'. Fernandez, 2000 WL 534449 (S.D.N.Y. May 3, 2000) at *1 . Counsel's failure to discharge his duties during plea negotiations is malpractice: "[l]t is malpractice for a lawyer to fail to give his client timely advice concerning" pleas. Id. It also constitutes ineffective assistance of counsel, and violates the Constitution. Thus, counsel has a duty to advise clients fully on whether a particular plea is desirable, since "[e]ffective assistance of counsel includes counsel's informed opinion as to what pleas should be entered." United States'. Villar, 416 F. Supp. 887, 889 (S.D.N.Y. 1976); Borial. Keane, 99 F.3d 492, 497 (2d Cir. 1996), citing ABA Model Code of Professional Responsibility, Ethical Consideration 7-7 (1992). Counsel also has a constitutional obligation to seek out information from the government, especially information that the government intends to use against the client. Failure to do so constitutes ineffective assistance of counsel. Rompillal. Beard, 545 U.S. 374 (2005). "The notion that defense counsel must obtain information that the state has and will use against the defendant is not simply a matter of common sense, . . it is the duty of the lawyer .. . ." Rompillal. Beard, 545 U.S. 374, 386 (2005), citing 1 ABA Standards for Criminal Justice 4-4.1 (2d ed. 1982 Supp).2 The constitution also requires that criminal defense lawyers conduct "a prompt investigation of the circumstances of the case," and this includes making every effort to secure information directly from the prosecutors: 2 The Supreme Court has "long ... rgferred [to these ABA Standards] as 'guides in determining what is reasonable."' Rompilial. Beard, 545 U.S. 374, 387 (2005). 21 EFTA00177907

Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 22 of 24 It is the duty of the lawyer to conduct a prompt investigation of the circumstances of the case. The investigation should always include efforts to secure information in the possession of the prosecution and law enforcement authorities. The duty to investigate exists regardless of the accused's admissions or statements to the lawyer of facts constituting guilt or the accused's stated desire to plead guilty. Rompillal. Beard, 545 U.S. 374, 386 (2005), citing 1 ABA Standards for Criminal Justice 4-4.1 (2d ed. 1982 Supp)• The lawyer's duty to investigate and obtain information from the prosecutor goes hand-in- hand with the lawyer's additional duty to "make suitable inquiry" to determine whether valid defenses exist. Jones'. Cunningham, 313 F.2d 347 (4th Cir.I 963) ("Of course, it is not for a lawyer to fabricate defenses, but he does have an affirmative obligation to make suitable inquiry to determine whether valid ones exist"). And regardless of whether valid defenses exist, counsel has a duty to initiate plea negotiations if he is to discharge his duty to faithfully represent the client's interests. Hawlanant Parratt, 661 F.2d 1161, 1171 (8th Cir. 1981) (counsel's "failure to initiate plea negotiations concerning the duplicitous felony counts constituted ineffective assistance of counsel which prejudiced I lawkman"). 3. The Court Should Recognize A Plea Negotiations Privilege To Avoid A Meaningful And Irreparable Chill In Plea Negotiations Reason and experience tell us that the system we have in place of sentencing laws, ethical rules, federal court dockets, and constitutional considerations, will not function if plea negotiations are not privileged. After all, "it is immediately apparent that no defendant or his counsel [would] pursue [plea negotiations] if the remarks uttered during the course of it are to be admitted in evidence as proof of guilt." Herman, 544 F.2d at 797. Plea negotiations are "rooted in the imperative need 22 EFTA00177908

Case 9 :08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 23 of 24 for confidence and trust," Jaffee, 518 U.S. at 10, and maintaining their confidentiality advances significant public and private cnds. Discovery and use of plea negotiations will cause "a meaningful and irreparable chill" to the "frank and complete disclosures" that result in negotiated resolution of criminal matters. In re Air Crash Near Cali, Colombia, 957 F.2d at 1533. For these reasons, plea negotiations are properly subject to a common law privilege under Federal Rule of Evidence 501. The Court should hold that the plea negotiation letters and emai Is between Mr. Epstein's lawyers and the government are privileged and not subject to discovery or evidentiary use by the plaintiffs. PART III MR. EPSTEIN HAS STANDING TO INVOKE RULE 6(E) During the August 12 hearing, the Court asked whether only the government has standing under Rule 6(e) to object to disclosure of grand jury materials. [Trans. at 27]. The answer is no. Mr. Epstein, too, has standing to raise these issues. The grand jury was created to protect the citizens, not to protect the government. Rule 6(e) implements those protections by requiring secrecy of matters occurring before the grand jury. The rule protects citizens against disclosure of information that is damaging to them, and in particular "protects the reputation of an accused who is not indicted." United States Malatesta, 583 F.2d 748, 753 (5th Cir. 1978). Mr. Epstein therefore has standing under Rule 6(e) to object to disclosure of matters occurring before the grand jury. 23 EFTA00177909

, Case 9:08-cv-80736-KAM Document 93-1 Entered on FLSD Docket 09/02/2011 Page 24 of 24 We certify that on September 2, 2011, the foregoing document was filed electronically with the Clerk of the Court using the CM/ECF system. Respectfully submitted, BLACK, SREBNICK, KORNSPAN & STUMPF, P.A. 201 South Biscayne Boulevard Suite 1300 Miami, Florida 33131 Office: (305) 371-6421 Fax: (305) 358-2006 By /S/ ROY BLACK, ESQ. Florida Bar No. 126088 JACKIE PERCZEK, ESQ. Florida Bar No. 0042201 On Behalf ofJeflkey Epstein 24 EFTA00177910

Page 1 of 25 Westlaw Page 1 183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) United States District Court, D. Maryland? Baltimore Division. NUTRAMAX LABORATORIES, INC., Plaiitiff, TWIN LABORATO,IES INC., et. al., De- fendants. No. Civ.AB-97-787. Dec. 7, 1998. In six patent infringement suits consol- idated for discovery, defendants moved to compel the production of various docu- ments used by counsel for the plaintiff to prepare a number of witnesses, including management officials of plaintiff, for their depositions. The District Court, Grimm, United States Magistrate Judge, held that: (1) documents supplied by plaintiffs coun- sel to prepare two management officials for deposition were subject to disclosure under evidence rule allowing discovery of docu- ments reviewed by a witness to prepare for deposition, based on implied waiver of work product protection, and (2) supplied by plaintiffs counsel to prepare other wit- nesses for deposition were not subject to disclosure under evidence rule, absent proof that witnesses used documents to re- fresh their memory for the purpose of testi- fying. Motion granted in part and denied in part. West Headnotes [1] C=01381 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(C) Depositions of Parties and Others Pending Action 170AX(C)3 Examination in Gen- eral 170Ak1381 k. In General. Most Cited Cases (Formerly 170Ak1414.1) While instructions not to answer ques- tions during depositions are generally im- proper, a witness may be instructed not to answer a question if the answer would re- veal privileged information. Fed.Rules Civ.Proc.Rule 30(dX1), 28 U.S.C.A. 1214e 1604(2) 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(E) Discovery and Production of Documents and Other Tangible Things 170AX(E)3 Particular Subject Matters 170Ak1604 Work Product Privilege; Trial Preparation Materials 170Ak1604(2) k. Waiver. Most Cited Cases (Formerly 170Ak1600(5)) If otherwise discoverable documents, which do not contain pure expressions of legal theories, mental impressions, conclu- sions or opinions of counsel, are assembled by counsel, and are put to a testimonial use in the litigation, then an implied limited waiver of the work product doctrine takes place, and the documents themselves, not their broad subject matter, are discover- able. Fed.Rules Civ.Proc.Rule 26(b)(3), 28 U.S.C.A.; Fed.Rules Evid.Rule 612, 28 U.S.C.A. (3] Federal Civil Procedure 170A C=. 1381 170A Federal Civil Procedure O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.condprint/printstream.aspx?rs=WLW11.07&pbc=BC6E23F9&destin... 9/26/2011 EFTA00177911

183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) whether the documents previously have been disclosed to the party taking the de- position; and (9) whether nere are credible concerns regarding manipulation, conceal- ment or destruction of evidence. Fed.Rules Evid.Rule 612, 28 U.S.C.A. [6] Federal Civil Procedure 170A €=. 1381 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(C) Depositions of Parties and Others Pending Action 170AX(C)3 Examination in Gen- eral 170Ak1381 k. In General. Most Cited Cases €=01417 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(C) Depositions of Parties and Others Pending Action 170AX(C)4 Scope of Examina- tion 170Ak1417 k. Work Product Privilege; Trial Preparation Materials. Most Cited Cases (Formerly 170Ak1415) Testimonial use of documents supplied by plaintiffs counsel to prepare witnesses for deposition resulted in a limited, implied waiver of the attorney work product doc- trine; witnesses used documents to refresh their memory prior to their depositions, for the pFpose of testifying, and it was neces- sary in the interest of justice that the docu- ments be disclosed to the defendants. Fed.Rules Civ.Proc.Rule 26(bX3), 28 U.S.C.A.; Fed.Rules Evid.Rule 612, 28 U.S.C.A. [7J Federal Civil Procedure 170A €=. Page 3 of 25 Page 3 1381 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(C) Depositions of Parties and Others Pending Action 170AX(C)3 Examination in Gen- eral 170Ak1381 k. In General. Most Cited Cases With respect to evidence rule allowing discovery of-documents reviewed by a wit- ness to prepare for a deposition, establish- ing that a witness used a writing to refresh his or her memory for the purpose of testi- fying may be accomplished by direct proof (an admission by the deponent that review of documents aided memory) or circum- stantial proof, from which an inference may he drawn whether such assistance was received. Fed.Rules Evid.Rule 612, 28 U.S.C.A. [8] Federal Civil Procedure 170A 4>=. 1381 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(C) Depositions of Parties and Others Pending Action 170AX(C)3 Examination in Gen- eral 170Ak1381 k. In General. Most Cited Cases €1417 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(C) Depositions of Parties and Others Pending Action 170AX(C)4 Scope of Examina- tion 170Ak1417 k. Work Product Privilege; Trial Preparation Materials. O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.corn/print/printstretun.aspx?rs=WLW11.07ttpbc=BC6E23F9&destin... 9/26/2011 EFTA00177912

183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) than what the defendants expected. To test the accuracy of their memones, counsel for the defendants asked whether the witnesses had reviewed any documents before their depositions to assist them in recalling the events relating to the first sale of Cosamin. Although it was acknowledged that docu- ments had been reviewed with counsel for Nutramax during deposition preparation, the witnesses were instructed not to answer all questions designed to discover their identity. The basis *461 for the instruction not to answer was Nutramax's assertion of the work product rule. ni4 Contending that Fed.R.Evid. 612 entitles them to the production of documents used to refresh the recollection of a witness prior to a de- position, the defendants filed pa motion to compel the production of the documents used to prepare the Nutramax witnesses. (Paper no. 145). Nutramax has filed an op- position and the Defendants a reply. (Paper nos. 150 and 155, respectively). The docu- ments which are the subject of this dispute were reviewed by me in camera, and a hearing was conducted on December 4, 1998. For the reasons cited below, the mo- tion will be granted, in part, and denied, in part. F143. In July, 1998, the defendants deposed the following witnesses, who are the subject of-this motion: Edgar J. Sharbaugh, Dr. Robert Henderson, Robert Picard, Todd Henderson, and Jeffrey Fara. FN4. While instructions not to an- swer questions during depositions are generally improper, a witness may be instructed not to answer a question if the answer would reveal privileged information. See Fed.R.Civ.P. 30(d 1); Local Dis- covery Guideline 5(d) (D.Md.1997); Boyd'. Maryland Med. SYs., 143, 144 (D.Md.1997). Page 5 of 25 Page 5 University of 173 F.R.D. DISCUSSION [2] The issue presented in this case, whether Fed.R.Evid. 612 requires the pro- duction of work product materials used to prepare a witness for a deposition, but not used during the deposition itself to refresh the witnesses' recollection, is an important one. It is a rare case today which does not involve the production of documents dur- ing discovery, and these documents can be of enormous importance in questioning witnesses about events which may have oc- curred years earlier. Recognizing the im- portance of documents in conducting ef- fective deposition discovery, counsel fre- quently postpone, as was done in this case, deposition discovery until document pro- duction has taken plac) pursuant to Fed.R.Civ.P. 34. See Lee . Flagstaff In- dus., 173 F.R.D. 651, 654-5 (D.Md.1997). In preparing to defend depositions in cases where substantial document produc- tion has taken place, no competent counsel can afford to ignore reviewing with wit- nesses the documents which relate to critic- al issues. During a deposition, counsel questioning a witness will seldom fail to ask the witness about what he or she did to prepare for the deposition, and the identity of any documents reviewed for this pur- pose. Most often, this inquiry is not res- isted by counsel defending the deposition, because the documents have already been produced to the opposing counsel. However, where, as here, many thousands of pages of documents have been produced and counsel have analyzed them and selec- ted a population of "critical documents" relevant to case dispositive issues, a depos- I) 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstrearn.aspx?rs=WLW11.07&pbc=BC6E23F9&destin... 9/26/2011 EFTA00177913

183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) 8A Wright, Miller & Marcus, Fed- eral Practice and Procedure § 2113 (2d ed.1994). There is contrary ( au- thority, however. ee, e.g. Omaha Pub. Power Dist. . Foster Wheeler Corp., 109 F.R. . 615, 616-17 (D.Neb.1986) ( Rule 30(c) does not incorporate Fed.R.Evid. 61; be- cause that rule implies testimony before a judicial officer). However, because depositions are so fre- quently used at trial in place of live testimony, see Fed.R.Civ.P. 32; Fed.R.Evid. 804(b)(1)? the better reasoned conclusion is that Rule 612 does apply at depositions. 1. The Work Product Doctrine In the now famous case of Hickman 11. Taylor, 329 U.S. 495, 67 S.Ct. 385, 1 L.Ed. 451 (1947), the Supreme Court re- cognized the work product doctrine. The doctrine creates a "protected zone" sur- rounding an attorney's preparation of a cli- ent's case which extends to information the attorney, or her agent, assembles in anticip- ation of litigation, as well as the deliberat- ive process she uses to separate relevant from irrelevant facts, determine strategy and legal theories. Id at 510-11, 67 S.Ct. 385. Despite its recognition of the import- ance of the work product doctrine for "an orderly working of our system of legal pro- cedure," the • Court acknowledged that the protection it afforded was not absolute, and could be "invaded" upon a showing of ad- equate reasons to justify production. Id. at 512, 67 S.Ct. 383. Fed.R.Civ.P. 26(bX3) which, as noted above, codifies the work product doctrine, fleshes it out, and provides, relevantly: a party may obtain discovery of docu- ments and tangible things otherwise dis- coverable ... and prepared in anticipation Page 7 of 25 Page 7 of litigation or for trial by or for another party or by or for that other party's rep- resentative (including the other party's at- torney, consultant, surety, indemnitor, in- surer, or agent) only upon a showing that the party seeking discovery has substan- tial need of the materials in the prepara- tion of the party's case and that the party is unable without undue hardship to ob- tain the substantial equivalent of the ma- terials by other means. In ordering dis- covery of such materials when the re- quirea showing has been made, the court shall protect against disclosure of the mental impressions? conclusions, opin- ions, or legal theories of an attorney or other representative of a party concerning the litigation. The Fourth Circuit has explained that this formulation of the doctrine divides work product into two categories, "fact work product," which may be discovered upon a showing of substantial need and in- ability, without undue hardship, to obtain the substantial equivalent of the materials by other means, and "opinion work product" which it has characterized vari- ously as "absolutely immune" or "nearly absolutely immune" from discovery. See In re Allen, 106 F.3d 582, 607 (4th Cir.1997) (opinion work product enjoys "nearly abso- lute" immunity); In Re Grand Jury Pro- ceedings, 33 F.3d 342, 348 (4th Cir.1994) (opinion work product even more scrupu- lously protected" than fact work' product); National Union Fire Ins. Co. R. Murray Sheet Metal Co., 967 F.2d 980, 984 (4th Cir.1992) (opinion work product "absolutely immune" from discovery); In re Martin Marietta Corp., 856 F.2d 619, 625 (4th Cir.1988); In re John Doe, 662 F. 2d 1073, 1080 ( 4th Cir. 1981), cert. denied 455 U.S. 1000, 102 *463 S.Ct. 1632, 71 L.Ed.2d 867 (1982) (opinion O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://webZwestlaw.contrintiprintstream.aspers=WLW11.07&pbc—BC6E23F9&destin... 9/26/2011 EFTA00177914

Page 12 of 25 183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) guage of Fed.R.Civ.P. 26(6)(3) suggests especial protection for opinion work product. Martin Marietta, 856 F.2d at 626 (internal citations omitted). In sum, a care- ful reading of Martin Marietta permits the conclusion that if testimonial use has been made of work product information, a lim- ited, non-subject matter implied waiver has occurred as to the materials put to that use, provided the disclosure of those materials would not reveal "core" opinion work product, namely pure expressions of attor- ney mental impressions, opinions or legal theory. The final Fourth Circuit opinion which must be considered with respect to the work product doctrine is In re Allen, 106 F.3d 582 (4th Cir.1997). In Allen, the Fourth Circuit, in a lengthy opinion, ad- dressed whether information covered by the attorney client privilege and the work product doctrine was subject to discovery in a civil case. The most significant part of this case, for purposes of the present dis- pute, came at the very end of *466 the opinion, when the court considered wheth- er an attorney's selection and collection of certain records of her client, which were themselves discoverable, constituted work product. The court stated: Yet, just as Allen prepared the interview notes and summaries in anticipation of litigation, she also chose and arranged these records in anticipation of litigation. This choice and arrangement constitutes opinion work product because Allen's se- lection and compilation of these particu- lar documents reveals her thought pro- cesses and theories regarding this litiga- tion. Page 12 that, although Allen did not address the is- sue presented in, this case,F,m2 it did cite as authority for its conclusion that docu- ments selected and compiled by counsel constitute opinion work product two cases which addressed the very issue raised in this case, the applicability of Fed.R.Evid. 612 to depositions. n.', More tellingly, the Allen court did not cite Martin Wri- elk', which contains the most detailed dis- cussion by the Fourth Circuit of the dis- tinction between fact and opinion work product. FN12. The First Circuit has con- sidered the issue of whether an at- torney's selection of certain docu- ments from a larger population of discoverable documents is opinion work product, and, therefore, shiel- ded from disclosure, even if used to prepare witnesses for depositions. In an opinion which is critical of the reasoning used in Sporck one of the cases relied on in Allen, the First Circuit concluded "[the reasoning used in Sporck ], we suggest, is flawed because it assumes that the relevatory nature of the sought-after information is, in itself, sufficient to cloak the information with the heightened protection of opinion work product. That is simply not the case; much depends on whether the fruits of the screening would soon be revealed in any event." In re San Juan Dupont Plaza Hotel Fire Litig., 859 F.2d 1007, 1018, (1st Cir.1988). FN1.0 These cases are: James Juli- an Raytheon Co., 93 F. r . 138 (D. 1.1982) and Sporck Peil, 759 F.2d 312 (3d Cir.l 5). In neither case did the court hold that Allen, 106 F.3d at 608. It is noteworthy O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.contrint/printstream.aspers=WLW11.07&pbc=8C6E23F9,Sidecti n ObAPIAI EFTA00177915

Page 10 of 25 183 F.R.D. 458,51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) L . way that the attorney client priv- ilege can. Whether the information involved is fact, as opposed to opinion, work product also affects how easily it can be waived. In Martin Modena, the Fourth Circuit ex- plained in considerable detail the rationale underlying the distinction between fact and opinion work product, and the reason why the latter is entitled to such expansive pro- tection. Because of the importance of the Martin Marietta opinion to the resolution of the issue presented in this dispute, it merits discussion at more length. In Martin Marietta, a former employee of that company was charged with mail fraud in connection with a government contract with the Department of Defense ("DOD"). Martin Marietta, 856 F.2d at 620. To assist in his defense, he sought to compel production of correspondence and notes from Martin Marietta relating to an administrative settlement agreement between that company and the DOD in- volving events which were the subject of the charges against the employee. Id. at 622. The employee sought the records to make out a defense that he was being made a scapegoat. Id. The records included the results of an internal audit, interview notes, transcripts, electronic recordings and cor- respondence relevant to the settlement agreement. Id. The company resisted the disclosure of the documents, asserting the attorney client and work product priv- ileges. Id. The district court ordered the production of certain of the requested doc- uments, but not others. On appeal, the Fourth Circuit addressed the issue of whether the production of work product materials to the DOD and U.S. Attorney's office during the negotiation of the admin- istrative settlement agreement constituted Page 10 an "implied waiver" of this privilege. Id at 622-26. The court began its analysis with a con- sideration of the Supreme Court's decision in Nobles, noting that that decision held that an attempt to make testimonial use of work product resulted in an implied waiver of the privilege. Id. at 624. The Fourth Cir- cuit then considered whether the scope of this waiver constituted broad subject matter waiver, or a more narrow waiver, applic- able only to the work product materials a - tually produced. Citing Duplan Corp. ■ Deering Milliken, Inc., 540 F.2d 1215 (4 Cir.1976), the court stated that Nobles es- tablished a rule that non-opinion work product put to a testimonial use resulted in subject matter waiver of those materials, and that, accordingly, Martin Marietta had impliedly waived its work product protec- tion for the non-opinion work product mat- ter disclosed to the government. Id at 625. In so doing, the court conceded that even if the production was limited to non-opinion work product, this information "necessarily will be reflective of a counsel's approach," but added "a distinction can be made between non-opinion work product, which may nevertheless be ordered produced if counsel has waived work product protec- tion, and pure mental impressions sever- able from the underlying data and arguably not subject to subject matter waiver." Id. This distinction is of vital importance to the present case, for it illustrates the essen- tial difference between non-opinion and opinion work product. The court recognized that "the line between opinion and non-opinion work product can be a fine one." Id. at 626. However, it emphasized that the essence of what the *465 work product doctrine is in- tended to protect is "pure expressions of 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?rs=WLW11.07&pbc=BC6E23179&destin... 9/26/2011 EFTA00177916

Page 13 of 25 183 F.R.D. 458,51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) the work product doctrine abso- lutely shielded documents selected and compiled by an attorney from disclosure if Fed.R.Evid. 612 was otherwise applicable. Indeed, in Ju- lian, the court ordered the produc- fion of the notebook of records se- lected and compiled by counsel. See Julian, 93 F.R.D. at 146. In Sporck the court did not order disclosure of such documents, not because it con- cluded they were absolutely im- mune from discovery, but instead, because it concluded that the party seeking disclosure of these docu- ments had failed to lay a proper foundation to trigger application of Evidence Rule 612. See Sporck 759 F.2d at 317-18. At first blush, reading Allen and Martin Marietta together could lead to the conclu- sion that if documents otherwise discover- able in litigation are selected and compiled by an attorney in anticipation of litigation, they constitute opinion work product and, therefore, are protected from disclosure, even if put to a testimonial use, because of the court's ruling in Martin Marietta that testimonial use of work product informa- tion only results in implied waiver of non- opinion work product. However, to reach such a result would exalt form over sub- stance for several important reasons. First, as stated in Martin Marietta, the dividing line between fact and opinion work product is not always easily discernable, see Martin Marietta, 856 F.2d at 626, and the mere se- lection of otherwise discoverable docu- ments by counsel falls closer to fact work product on the continuum than it does to core opinion work product. Second, the disclosure of even "pure" fact work product will necessarily disclose informa- tion about an attorney's approach to the lit- Page 13 igation of the case, so it is never possible to completely insulate an attorneys' thought process from discovery when any form of work product is disclosed. See id. at 625. Third, what the work product doctrine is fundamentally designed to protect against is disclosure of "pure" mental impressions or opinions of counsel. See id. Disclosure of opinion work product consisting of re- cords of a party to the litigation which are themselves subject to discovery, and which do not contain "pure" expressions of coun- sel's mental impressions or theories, does not do violence to the policy underlying the work product doctrine, particularly if those documents already have been put to a testi- monial use by the party whose attorney se- lected and compiled them. Fourth, neither Martin Marietta, Allen, nor any other Fourth Circuit opinion, has addressed the exact question presented in this case, and therefore, did not have to reconcile the conflict which exists between the important policies which underlie the work product doctrine*467 and Evidence Rule 612. And, finally, neither the Martin Marietta nor the Allen court held that the protection af- forded to opinion work product was abso- lute. See Martin Marietta, 856 F.2d at 625-26; Allen, 106 F.3d at 607 ("opinion work product `enjoys a nearly absolute im- munity and can be discovered only in very rare and extraordinary circumstances' "). n414 FNI4. In Berkey Photo, Inc. A Eastman Kodak Co., 74 F.R.D. 6 (S.D.N.Y.1977), one of the first, and most often cited, cases to ad- dress the issue presented here, the court was faced with reconciling decisions, such as Martin Marietta and Allen, which held that opinion work product was entitled to a nearly "absolute immunity from O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?rs=WLW1 I .078cpbc=BC6E23F98cdestin... 9/26/2011 EFTA00177917

Page 15 of 25 183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) has been noted that the legislative history of Rule 612 is somewhat ambiguous, be- cause the rule itself is silent with respect to whether it applies to work product materi- als used to refresh recollection. See James Julian,' 93 F.R.D. at 145, Bank Hapoalim, 1994 WL 119575, at *5. It does appear, however as though the House Committee on the Judiciary did not intend the rule to operate in such a way that it would allow a "fishing expedition" into the documents a witness may have referred to in preparing for trial, nor did that committee intend for it to bar "the assertion of a privilege with respect to writings used by a witness to re- fresh his memory." H.Rep. No. 650, 93rd Cong., 1st Sess. (1973), reprinted in 1974 U.S.C.C.A.N. 7075, 7086. Because of the apparent conflict between Evidence Rule 612 and the work product doctrine, as codified in Fed.R.Civ.P. 26(bX3), *468 courts have looked for various ways to harmonize the two rules. See Joint Eastern and Southern Dist. Asbros Litig., 119 F.R.D. 4 at 5, Redvanly . NYNEX Corp., 152 F.R.D. 460, 470 (S.D. .Y.1993). The process has pro- duced inconsistent results, with some courts concluding that work product mater- ials which were reviewed by a witness pri- or to being deposed were subject to dis- closure under Rule 612,m16 and others concluding that they were notitm FN16. See, e.g. Wheel- ing—Pittsburgh Steel I. Under- writers Labs., Inc., 81 F.R.D. (N.D.I11.1978); James Julian Raytheon Co., 93 F.R.D. 1 (D.Dek 1982); Omaha Public Power Dist. I. Foster Wheeler Corp., 109 F.R.D. 615 (D.Neb.1986); Joint Eastern and Southern Dist. Asbes- toslitig., 119 F.R.D. 4 Page 15 i (E.&S.D.N.Y.1988); Redvanly EX Corp., 152 F.R.D. 4 (S.D.N.Y.1993); Bank Hapoalim . American Home Assurance Co., o. 92 CV 3561, 1994 WITI 119575 (S.D.N.Y.1994); Ehrlich I. Howe, 848 F.Supp. 482 (S.D. .Y.1994); Audiotext U.S. fommunications Net- work Inc. . Telecom, Inc., 164 F.R.D. 2 0 (D.Kan.1996). FN17. See, e.g. Sporck A Peg 759 F.2d1 1. 1.2 (3d :..lir.19 ); Berkey Photo Eastman Kodak Co., '74 F.R.D. IlD3, (S.D.N.Y.197 Derderian . Polaroid corp.. 1 F.R.D. 13 .Mass.1988); Baker CNA Insurance, 123 F.k.D. 3 (D.Mont.I988); Timm . Mead Corp., No. 91 CV 5648 992 WL 32280 (y.111.19921 Butler Mfg. Co. Inc. . Americold Corp., 148 F.R.D. 2 5 (D.Kan.1 3); Ark- wright Mut. Ins. Co. National Union Fire Ins. Co., o. 90 CV 7811, 1994 WL 510043 (S.D.N.Y.1994). [3] As a threshold matter, three founda- tional elements must be met before Rule 612 is applicable with respect to docu- ments reviewed by a witness to prepare for a deposition: (1) a witness must use a writ- ing to refresh his or her memory; (2) for the purpose of testifying; and (3) the court must determine that, in the interest of justice, the adverse party is entitled to scp the writing. Fed.R.Evid. 612; see Sporck l. Peil, 759 F.2d 312 317 (3d Cir.1985); But- ler Mfg. Co., Inc. . Americold Corp., 148 D. F.R. 275, 278 .Kan.1993); 4 Jack B. Weinstein and Margaret A. Berger, Wein- stein's federal Evidence § 612.07[1] (2d ed.I997). The first element insures that the writing is relevant to an attempt to test the 43 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. hrips://web2.westlaw.com/print/printstream.aspx?rs=WLW11.07&pbc=BC6E23F9&destin... 9/26/2011 EFTA00177918

Page 17 of 25 183 F.R.A. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) Fed.R.Evid. 602. Others, however, are not so restricted. Expert witnesses, for ex- ample, may base their opinions on informa- tion supplied by others, if reliable. Fed.R.Evid. 703. Similarly, Fed.R.Civ.P. 30(b)(6) allows a party to designate a wit- ness to testify on its behalf with respect to specified subjects. The testimony of such witnesses also is not limited to matters within their personal knowledge, but ex- tends to "matters known or reasonably available to" the party designating the wit- ness. Rule 30(b)(6). There is a greater need to know what materials were reviewed by expert and designee witnesses in prepara- tion for deposition since the substance of their testimony may be based on sources beyond personal kuowledge.Fm9_(2) The nature of the issue in dispute. Whether a witness is testifying generally about the transactions which are the subject of the litigation, or more precisely about a subset of facts which relate to a case dispositive issue (such as a statute of limitations de- fense, or, as in this case, the on sale bar de- fense) may affect the need to know what materials were reviewed to prepare for de- sition. (3) When the events took place. Whether the events about which the wit- ness will testify took place recently, or years ago, affects the need to know what materials were reviewed. The ability of a witness to perceive, remember, and relate events is fair game for cross examination, and a deposing attorney has a legitimate need to know whether the witness is testi- fying from present memory, unaided by any review of extrinsic information, present memory "refreshed" by reference to other materials, or really has no present memory at all, and can only "testify" as to what is memorialized in writings prepared by the witness or others. The greater the passage of time since the events about which the witness will testify, the more Page 17 likely that the witness needed to refresh his or her recollection to prepare for testimony. (4) When the documents were reviewed. As noted, Fed.R.Evid. 612 only applies to use of documents to refresh recollection for purposes of providing testimony. Thus, re- view of documents for purposes other than deposition or trial testimony is exempt from the rule. In complex cases, or cases involving many documents, counsel may have many occasions to review with clients documents which relate to the issues in the litigation, such as preparation of pleadings or motions, responding to Fed.R.Civ.P. 34 document production requests, and devel- opment of case strategy. Such review is not for purposes of providing testimony. Ac- cordingly, if a witness reviewed documents months before a deposition, for a purpose other than to prepare to testify, disclosure of the documents reviewed should not be required in response to a Rule 612 demand. The nearer the review of documents to the date of the deposition may affect whether the court concludes that the purpose was to prepare for testimony. (5) The number of documents reviewed. Whether a witness re- viewed hundreds of documents, as opposed to a few critical ones, *470 may affect the decision whether to order the disclosure of work product materials in response to a Rule 612 demand. If an attorney has culled through thousands of documents to identify a population of several hundred which are most relevant to the litigation, and the wit- ness reviews these documents to prepare for the deposition, a court may be less in- clined to order the production of such work product than if the witness reviewed a single document, or very few documents, selected by the attorney which relate to a critical issue in the case /tap (6) Whether the witness prepared the document(s) re- viewed. If the witness prepared the docu- ment (s) reviewed in preparation for the de- O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?rs=WLW11.078cpbc=BC6E23F9&destin... 9/26/2011 EFTA00177919

Page 19 of 25 183 F.R.D. 458, 51 Fed. R. Evid. Sew. 35 (Cite as: 183 F.R.D. 458) 3. Analysis Five witnesses are implicated by the pending motion: Edgar J. Sharbaugh, Dr. Robert Henderson, Robert Picard Todd Henderson, and Jeffrey Fara. reflendants motion to compel, Paper no. 145, at 2-7). Sharbaugh is co-owner of Nutramax, and vice-president of marketing. He was de- posed as a designee of Nutramax, pursuant to Fed.R.Civ.P. 30(b)(6) regarding a num- ber of subjects, including the creation, re- tention and destruction of documents, the existence of records regarding purchase and sales transactions of the plaintiff, as well as product identification and sales in- formation of the company between 1991 and 1993. Id. at 2-3. Dr. Henderson is a co-owner and the president of Nutramax. He is the inventor of the two patents which are the subject of this litigation, and was *471 deposed as a rule 30(6)(6) designee regarding the first combination of ingredi- ents of Cosamin, the subject of the patents, as well as the first purchase dates of the in- gredients for Cosamin, and its first sale and use. Id. at 3. Picard is a shipping clerk for the plaintiff, and apparently was not de- posed as a designee witness. Id. at 4. Todd Henderson Dr. Henderson's son, is a co- owner of Nutramax, and a vice-president, in charge of its veterinary science division. He signed the plaintiffs interrogatory an- swers, and testified as a fact witness, not as a Rule 30(b)(6) designee. Id. The final wit- ness, Jeffrey Fara, is a longstanding friend of Dr. Henderson, who assertedly pur- chased Cosamin on March 27, 1992, just days before the critical date of March 31, 1992. Id. at 6-7. Excerpts from the depos- itions of Sharbaugh, Dr. Henderson, and Picard were provided as attachments to the plaintiffs motion. None were provided with respect to Todd Henderson and Jef- frey Fara. Page 19 Pursuant to my order dated October 22, 1998, (Paper no. 158), the plaintiffs provided me with a notebook containing the documents used to prepare the forego- ing witnesses for their depositions. I re- viewed these documents in camera. They remain under seal, and the defendants have not seen them. The notebook contains 41 documents. Plaintiffs further provided a helpful chart listing the documents used to prepare each of the witnesses. Eleven were used to prepare Sharbaugh 32 to prepare Dr. Henderson, five for Picard, two for Todd Henderson, and nine for Fara. With the exception of document no. 23, for which the attorney client privilege was as- serted, plaintiffs state that all of the docu- ments contained in the notebook have been produced to the defendants during discov- ery/am) (Paper no. 150, at p. 7). FN23. During the hearing held on December 4, 1998, counsel for the defendants acknowledged that the defendants do, at present, have all of the disputed documents, except no. 23, but asserted that some of these documents, relating to Dr. Bucci, a non-party witness, were not provided to the defendants until after the Sharbaugh and Dr. Hende- rson depositions. Because I am or- dering the production of the docu- ments used to prepare both of these witnesses, (except for document no. 23), as well as the limited reopening of their depositions, it is not neces- sary for me to separately consider the significance of the fact that some of the "Bucci documents" were not produced until after Dr. Henderson's deposition. However, to the extent that documents were produced by the defendants after Dr. Henderson's deposition which rD 2011 Thomson Reuters. No Claim to Orig. US Oov. Works. https://web2.westlaw.com/print/printstream.aspx?rs=WLW11.078cpbc=BC6E23F9Rdestin... 9/26/2011 EFTA00177920

183 F.R.D. 458,51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) accordingly, demonstrated the first two ele- ments of Rule 612, and, concomitantly, for purposes of work product doctrine analys- is, that the documents selected by plaintiffs attorneys for him to review were used by Sharbaugh for a testimonial pur- pose. Whether they must be disclosed, as demanded by the defendants, turns on the third element of Rule 612, the balancing test, and an evaluation of the factors identi- fied above. Sharbaugh was a Rule 30(b)(6) design- ee, and therefore his testimony was not limited to facts personally known to him, but also to those reasonably available to the plaintiff. Fed.R.Civ.P. 30(bX6). Because of this, the defendants had a heightened need to discover the factual basis for his testi- mony. This was underscored by the fact that he testified as to issues which are po- tentially case determinative and events which took place more than Avefi years ago. Sharbaugh's ability to perceive, remember and relate these events, which are highly relevant to his credibility, are legitimate areas for inquiry by the defendants, partic- ularly in light of his direct involvement in the destruction of documents in 1994 and 1998 r' FN25. From the limited information provided to me, I am unable to draw any conclusions about whether the destruction of documents was inno- cent, as plaintiff asserts, or sinister, as the defendants contend. See supra note 24. Sharbaugh only reviewed eleven docu- ments, some selected by him, and others by plaintiffs attorneys,' and all of them are apparently now m the defendants' pos- session. In other circumstances, this factor would militate against disclosure. However, given the fact that thousands, Page 21 of 25 Page 21 perhaps hundreds of thousands, of docu- ments have been produced for inspection during discovery, it would be difficult for the defendants to easily determine a popu- lation of documents which likely would be relevant to Sharbaugh's testimony. From my review of the documents in cornett'? it is clear that none contain "pure" opinion attorney work product, such as discussion of case strategy, litigation theories or men- tal impressions. Finally, as noted above, there is no dispute that documents have been destroyed, both before and after the commencement of this litigation, which re- late to important issues in the case. Shar- baugh is at the center of the dispute regard- ing these documents, and much will hinge on his credibility. While the outcome of this controversy cannot now be predicted, it is undeniably significant. In light of all of these circumstances, I conclude that use of the documents selected by counsel to prepare Sharbaugh for his deposition con- stituted a testimonial use oft hese docu- ments which resulted in a limited, implied waiver of the attorney work product doc- trine as to them. I further fmd that the first two elements of Rule 612 have been met as to him, and that, having considered the bal- ancing factors discussed above, it is neces- sary in the interest of justice for the eleven documents used to prepare Sharbaugh be produced to the defendants."427 FN26. Assuming those eleven docu- ments had been selected by Shar- baugh, with plaintiffs attorneys talc- ing no part in that selection, such a situation would not implicate the work product doctrine, and there- fore, disclosure would be warranted based solely on Fed.R.Evid. 612. FN27. Plaintiff also asserted the at- torney client privilege as an inde- O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/printiprintstream.aspx?rs---WLW11.07&pbc=BC6E23F98cdestin... 9/26/2011 EFTA00177921

183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) the inventor of this product and, presum- ably, a significant actor in the events sur- rounding the first use and sale, is of great importance, his testimony as a designee re- quired him to provide information based on information reasonably available to the plaintiff. Fed.R.Civ.P. 30(bX6). Dr. Hende- rson admitted that it was possible that the first use and sale of Cosamin occurred be- fore March 311 1992, and that he "flat out" did not know if it was offered for sale be- fore that date. In such circumstances, the ability to have questioned him in more de- tail about the events of that time using doc- uments prepared in the ordinary course of business was of unquestionable importance to defendants. Combined with the fact that the overwhelming majority of the plaintiffs own records relating to that time apparently have been destroyed by Nut- ramax, the defendant's need for access to the documents which Dr. Henderson re- viewed for purposes of testing his memory cannot be understated. It is all too easy for a witness to testify that his recollection is vague, as did Dr. Henderson, and to give the appearance of candor by acknow- ledging the possibility of the occurrence of an important event, all the while maintain- ing that it cannot be conceded that it actu- ally did. Rigorous cross examination is needed to test such self-serving statements by focused, analytical questioning, using contemporaneously prepared documents, if available, to test the witness's assertions. Without the use of such documents, or oth- ers which might have assisted if they had not been destroyed by the plaintiff, the de- fendants were at a clear *474 disadvantage. Additionally, from my review of the docu- ments in camera? it is clear that none con- tain "pure" opinion attorney work product, such as discussion of case strategy, litiga- tion theories or mental impressions. There- fore, the first four, seventh and ninth Page 23 of 25 Page 23 factors overwhelmingly militate in favor of disclosure. The remaining factors are either neut- ral, or do not sufficiently undermine the ar- gument for disclosure to change the out- come of the analysis. With the exception of document 23, which clearly is exempt from disclosure under the attorney client priv- ilege, none of the documents reviewed by Dr. Henderson contain "pure" opinion work product. Accordingly, I conclude that with respect to the 32 documents used to prepare Dr. Henderson for his deposition, all except no. 23 are discoverable. Having been put to a testimonial use, a limited, im- plied waiver of work product immunity has occurred, and the first two elements of Rule 612 have been met. The third element of that rule, the balancing of factors, also strongly supports disclosure of these docu- ments in the interests of justice. [8] Robert Picard testified, apparently as a fact witness, and not a rule 30(b)(6) designee Nu He admitted meeting with counsel for the plaintiff within weeks of his deposition to prepare for it, and reviewing documents, although the details regarding this review were not disclosed because counsel for Nutramax instructed him not to answer these questions. When asked whether his review of the documents re- freshed his recollection with respect to the events surrounding them, he stated that it did not. (Paper No. 145, Ex. E at 89-93, 159-60, Picard deposition, July 29, 1998). Having read the five documents which Pi- card did review, it is understandable why he denied that they assisted in his recollec- tion of the events surrounding the first sale of Cosamin. Accordingly, I conclude that the first element of Rule 612 has not been established, making the documents not sub- ject to discovery. -Nevertheless, were I to C 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?rs=WLW11.078cpbc=BC6E23F9&destin... 9/26/2011 EFTA00177922

Page 25 of 25 Page 25 183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 (Cite as: 183 F.R.D. 458) ments used to prepare the depos- ition witnesses who are •the subject of this dispute, or the identification of the documents used to prepare each of those witnesses. CONCLUSION In conclusion, the eleven documents *e- 1 viewed by Sharbaugh, and the documents reviewed by Dr. Henderson, except for no. 23, shall be disclosed. The motion to com- pel as to Picard, Todd Henderson and Fara is denied. Plaintiffs will make the ordered disclosures within 14 days of this order. In addition, I will permit a limited reopening of the depositions of Sharbaugh and Dr. Henderson to permit defendants to examine them further regarding their use of the doc- uments I have ordered disclosed, and to further test their memories in light of these documents. Counsel will, within 14 days of this order, contact my chambers to sched- ule a telephone conference call to discuss the limits of these depositions. D.Md.,1998. Nutramax Laboratories, Inc. I. Twin Laboratories Inc. 183 F.R.D. 458, 51 Fed. R. Evid. Serv. 35 END OF DOCUMENT C 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. Imps://web2.westlaw.corniprint/printstream.aspx?rs=WLW11.07ecpbc=BC6E23F9&destin... 9/26/2011 EFTA00177923

Page 1 of 16 Westlaw Page 1 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) United States District Court, D. Maryland. CONTINENTAL CASUALTY COM- PANY, et l, Plaintiffs, UNDER ARMOR , INC., Defendant. No. 06 CV 3224 CCB. Feb. 13, 2008. Background: In declaratory judgment ac- tion, three insurance companies sued their insured, seeking a determination that they were not obligated to defend or indemnify it in connection with litigation brought against insured by two Nevada corpora- tions. Insured filed motion for a ruling re- garding what use, if any, it could make of a file it received from its independent insur- ance broker, containing copies of claims notes allegedly containing attorney client privileged and work product protected communications from insurers' counsel, which erroneously had been posted in the wrong location by insurers' el-aims special- ist on insurers' website. Holdings: The District Court, Paul W. Grimm, United States Magistrate Judge, held that: (1) attorney-client privilege was waived by insurers' claims specialist's inadvertent posting of insurers' privileged communica- tions on insurers' website, and (2) insurers' inadvertent posting of work product, prior to the filing of lawsuit, on a website to which insurers' adversary had been given access, waived work product protection. Order in accordance with opinion. West Headnotes 111 Federal Courts 170B €=416 170B Federal Courts 170BVI State Laws as Rules of De- cision 170BVI(C) Application to Particular Matters 170Bk416 k. Evidence law. Most Cited Cases In declaratory judgment action bot- tomed on diversity of citizenship, state law governed issue as to whether attorney-cli- ent privilege was waived by insurers' claims specialist's inadvertent posting of insurers' privileged communications on in- surers' website. Fed.Rules Evid.Rule 501, 28 U.S.C.A. 121 Privileged Communications and Con- fidentiality 311H €168 31111 Privileged Communications and Confidentiality 311HIII Attorney-Client Privilege 311Hk168 k. Waiver of privilege. Most Cited Cases (Formerly 410k219(3)) In declaratory judgment action seeking determinations of insurers' obligation to defend or indemnify insured, attorney-cli- ent privilege was waived under Maryland law by insurers' claims specialist's inad- vertent posting of insurers' privileged com- munications on insurers' website; the dis- closure to insured and its insurance broker was a result of the voluntary, albeit inad- vertent, acts by claims specialist, and not because of any wrongdoing by insured, or its insurance broker. 13] Federal Civil Procedure 170A €=, 1604(2) 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F9&destination=atp&utid=... 9/26/2011 EFTA00177924

Page 2 of 16 Page 2 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(E) Discovery and Production of Documents and Other Tangible Things 170AX(E)3 Particular Subject Matters 170Ak1604 Work Product Privilege; Trial Preparation Materials 170Ak1604(2) k. Waiver. Most Cited Cases (Formerly 170Ak1600(5)) Waiver of the attorney-client privilege for a communication does not automatic- ally waive whatever work-product im- munity that communication may also en- joy. [4] Federal Courts 1708 C416 170B Federal Courts 170BVI State Laws as Rules of De- cision 170BVI(C) Application to Particular Matters 170Bk416 k. Evidence law. Most Cited Cases In a diversity case, court applies federal law to resolve work product claims. Fed.Rules Civ.Proc.Rule 26(b)(3), 28 U.S.C.A. [5j 04( Federal Civil Procedure 170A €=+ 16 2) 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(E) Discovery and Production of Documents and Other Tangible Things 170AX(E)3 Particular Subject Matters 170M1604 Work Product Privilege; Trial Preparation Materials 170Ak1604(2) k. Waiver. Most Cited Cases (Formerly 170AJc1600(5)) Disclosing party's work product priv- ilege will be deemed waived only if such disclosure substantially increases the pos- sibility that an opposing party could obtain the information disclosed. Fed.Rules Civ.Proc.Rule 26(bX3), 28 U.S.C.A. 161 Federal Civil Procedure 170A C 1604(2) 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(E) Discovery and Production of Documents and Other Tangible Things 170AX(E)3 Particular Subject Matters 170Ak1604 Work Product Privilege; Trial Preparation Materials 170Mc1604(2) k. Waiver. Most Cited Cases (Formerly 170Ak1600(5)) Insurers' inadvertent posting of work product, prior to the filing of lawsuit, on a website to which insurers' adversary had been given access, waived work product protection. Fed.Rules Civ.Proc.Rule 26(b)(3), 28 U.S.C.A. [7] Federal Civil Procedure 170A €=, 1604(2) 170A Federal Civil Procedure 170AX Depositions and Discovery 170AX(E) Discovery and Production of Documents and Other Tangible Things 170AX(E)3 Particular Subject Matters 170Ak1604 Work Product Privilege; Trial Preparation Materials 170Ak1604(2) k. Waiver. Most Cited Cases (Formerly 170Ak1600(5)) Disclosure of work product to an agent 0 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F9&destination=atp&utid=... 9/26/2011 EFTA00177925

Page 3 of 16 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) is tantamount to disclosure to the principal, for purpose of waiver of the privilege. *762 David P. Durbin, D. Stephenson Schwinn, Jordan Coyne and Savits LLP, Washington, DC, Arthur J. Mccolgan, II, Ryan M. Henderson, Walker Wilcox Mat- ousek LLP, Chicago, IL, for Plaintiffs. Michael Thomas Sharkey, Andrew M. Weiner, Dickstein Shapiro LLP, Washing- ton, DC, for Defendant. MEMORANDUM AND OPINION PAUL W. GRIMM, United States Magis- trate Judge. In this declaratory judgment action, three insurance companies, Continental Casualty Company, Transcontinental Insur- ance Company, and Valley Forge Insur- ance*763 Company, collectively referred to as "CNA", sued their insured, tinder Ar- mour, Inc., seeking a determination that, under a series of insurance policies issued to Under Armour, they are obligated neither to defend nor indemnify it in con- nection with litigation brought against Un- der Armour by two other companies, To- polewski America Inc., and Metal Jeans, Inc. The case has been assigned to me to resolve all discovery disputes. Paper No. 33. The pending dispute involves Under Armour's motion for a ruling regarding what use, if any, it may make of a .pdf file it received from its independent insurance broker, Frenkel and Company, ("Frenkel") containing copies of claims notes allegedly containing attorney client privileged and work product protected communications from CNA's counsel, which erroneously had been posted in the wrong location by the CNA claims specialist assigned to the Under Armour claim on a CNA website, cnacentral.com. Frenkel was authorized by CNA to access and read the claims notes Page 3 for "its own individual use" by a Terms of Service Agreement it entered into with CNA. As to these allegedly privileged and protected materials, Under Armour con- tends that neither the attorney client priv- ilege nor work product doctrine is applic- able, or, if applicable, that they have been waived. CNA asserts that the claims notes at issue are privileged and protected, and that there has been no waiver. The motion has been fully briefed in Papers No. 27, 28, 29, 39, and 40 and the parties have stipulated that Maryland law governs, Paper No. 37. On January 14, 2008, a hearing was held in court during which I assumed? without deciding, that the claims notes at issue were both privileged and work product protected, but ruled that both the privilege and protection had been waived, Paper No. 41. Although I fully ex- plained the basis for my ruling during the hearing, I reserved the right to supplement the ruling with a written memorandum and opinion, to provide guidance to counsel in other cases regarding the recurring difficult issues raised by this dispute. This memor- andum and order serves this purpose. Background CNA issued four insurance policies to Under Armour-two general liability policies and two umbrella policies. Compl., Paper No. 1,1 19. In February 2006, Under Armour was sued by two Nevada corpora- tions, Topolewski America, Inc., and Metal Jeans, Inc., in the United States District Court for the Central District of California. Compl., Paper No. 1, 11 9-10. The lawsuit asserted multiple causes of action, includ- ing allegations that Under Armour had in- fringed trademarks held by Topolewski and Metal,, and was selling clothing and ac- cessories under a logo that was confusingly similar to their own. Id at 1 11. The law- 4O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F98thestination=atpecutid=... 9/26/2011 EFTA00177926

Page 4 of 16 Page 4 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) suit sought both injunctive and monetary relief. After it was served, Under Armour put CNA on notice of the suit and reques- ted that CNA undertake its defense, and in- demnify it in the event that it was found li- able. CNA assigned Under Armour's cover- age claim to James J. Hoefer, a claims con- sultant, Aft of James Hoefer, Ex. B, fl 3-4, Pls.' Resp. to Def.'s Mot., Paper No. 28 (hereinafter "Hoefer Aff. at '), who coordinated with in-house clait counsel, (referred to in CNA's claims file as "CLEM counsel") and outside coverage counsel. As he worked on the coverage issues, Hoefer posted claims notes memorializing his ac- tions, including summaries and copies of communications with CLEM counsel and coverage counsel, on a website, cnacent- ral.com, a web-based program designed to permit independent insurance brokers who sell CNA products to quote and request is- suance of policies for their clients, and thereafter to track claims for coverage once the insurance has been issued.*764 Aff. of Nancy Stoecker, Ex. A. 11 4-5, 13, Pls.' Resp. to Def's Mot., Paper No. 28 (hereinafter "Stoecker Aff. at "). Under Armour purchased the policies from CNA by using such an independent insurance broker, Frenkel and Co. When the Topolewski suit was filed, Michael Peace, a senior claims consultant at Fren- kel was assigned to monitor the suit and CNA's response to Under Armour's cover- age claim. CNA had provided Frenkel with access to its cnacentral.com website, issu- ing it a password, account number and lo- gin ID to facilitate its monitoring the claims notes posted on the website pertain- ing to the Under Armour coverage claim. Aff. of Michael Peace, 11 5-11, attached to Under Armour's Mem. in Supp. of its Mot. for a Ruling on the Use of the Claims Notes, Paper No. 27 (hereinafter "Peace Aff. at "). Prior to receiving this access, Frenkeiliened a Terms of Service Agree- ment with CNA in which it agreed, inter alia, to "visit, view and to retain a single copy of pages of this Site solely for [its] ... own individual use". Ex. C, Paper No. 28, CNA's Resp. to Under Armour's Mot. To monitor the handling of Under Ar- mour's coverage claim, Peace accessed the cnacentral.com website and reviewed claims notes posted by Hoefer. In Decem- ber 2006, when he received notice from CNA that it had determined to deny Under Armour a defense and file a declaratory judgment action, he exchanged email with Hoefer in which he referenced the earlier claims notes he had read, and questioned why CNA had decided to disclaim cover- age when it previously had been proceed- ing in the direction of providing Under Ar- mour with a defense, under a reservation of rights. Peace Aft at 1 16-17. Unbeknownst to Peace, Hoefer was supposed to have des- ignated privileged and protected commu- nications from counsel as confidential be- fore he posted them on the cnacentral.com website, by selecting a "button" on the computer that would not post them to the portion of the site to which Peace had ac- cess, but rather to a restricted portion of the website. Hoefer Aff. at 11 9-11, Stocker Aff. at 11 14-16. Hoefer inadvertently neg- lected to designate the privileged and pro- tected material as confidential when he posted it to cnacentral.com. With regard to the specific claims entries that are the subject of the pending motion, Hoefer summarized communica- tions he had with CLEM and coverage counsel in his cnacentral.com claim notes, and also attached copies of email commu- 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F9&destination=atpicutid=... 9/26/2011 EFTA00177927

Page 5 of 16 Page 5 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) nications from them as well. Hoefer posted a minimum of eight potentially privileged and protected entnes on the website on Au- gust 17, 2006 (multiple postings), Septem- ber 12, 2006, November 17, 2006, and November 22, 2006 (multiple postings). PM When Hoefer notified Peace that CNA had disclaimed coverage and decided to file a declaratory judgment action, Peace prepared a .pdf file containing the above referenced postings, and provided them to Under Armour. Peace Aft at ¶ 12. Under Armour, in turn, provided the .pdf to the at- torneys representing it in this action. When they reviewed the file and determined that it appeared to contain entries that could be privileged or protected, they ceased read- ing further, and notified counsel for CNA on July 10, 2007. Ex. D, Paper No. 28, CNA Resp. to Under Armour's Mot. In re- sponse, on July 11, 2007, counsel for CNA replied, asserting that the claims notes in- cluded attorney client privileged and work product protected communications, and denying that these *765 protections had been waived. Ex. E. Paper No. 28, CNA Resp. to Under Armour's Mourn This motion followed. FNI. Because the exhibits to the motions papers remain sealed until the final resolution of the pending motion, including any objections filed to the rulings by the under- signed, this memorandum will de- scribe them only in general terms. FN2. As noted during the hearing, when dealing with each other in connection with this sensitive and important issue, counsel for both Under Armour and CNA acted with the utmost professionalism and courtesy in their correspondence and their court filings. Disputes such as these can tend to bring out the worst in counsel, prompting ac- cusations of unethical and unprofes- sional behavior, and counter allega- tions of incompetence or careless- ness. Such behavior was entirely absent here, where the disagree- ments were on the merits, and not ad hominem. Discussion I. Waiver of the Attorney Client Privilege by Inadvertent Disclosure As noted, CNA argues that the entries at issue are attorney client privileged and work product protected, and that Hoefer's inadvertent posting of them on the cnacent- ral.com website did not waive either pro- tection, inasmuch as CNA took prompt ac- tion to assert the privilege and protection as soon as it learned of the inadvertent postings. Under Armour disputes the ap- plicability of either the privilege or work product protection, but argues, alternat- ively, that even if privileged and protected when created, these protections were waived. Of the two issues, the privilege one is the more easily resolved, and will be addressed fast. [1][2] Although this is a declaratory judgment action filed pursuant to 28 U.S.C. § 2201 (2000), this court's underlying 1 juris- diction lies in diversity of citizenshi , pur- suant to 28 U.S.C. & 1332 (2 , See Volvo Const. Equip NAm., Inc. CLM Equip. Co., 386 F.3d 581, 5 (4th Cir.2004) (holding "a federal court may properly exercise jurisdiction in a declarat- ory judgment proceeding when three essen- tials are met: (1) the complaint alleges an 'actual controversy' between the parties 'of sufficient immediacy and reality to warrant issuance of a declaratory judgment;' (2) the court possesses an independent basis for O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstrearn.aspx7pbc=BC6E23F98cdestination=atp&utid=... 9/26/2011 EFTA00177928

Page 6 of 16 Page 6 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) jurisdiction over the parties (e.g., federal question or diversity jurisdiction); and (3) the court does not abuse its discretion in its exercise of jurisdiction."). As noted, coun- sel have stipulated that in this diversity of citizenship declaratory judgment action seeking an interpretation of four insurance policies, Maryland law governs. Paper No. 37. Further, Fed. R. of Evid. 501 states: Except as otherwise required by the Con- stitution of the United States or provided by Act of Congress or in rules prescribed by the Supreme Court pursuant to stat- utory authority, the privilege of a wit- ness, person, government, State, or polit- ical subdivision thereof shall be governed by the principles of the common law as they may be interpreted by the courts of the United States in the light of reason and experience. However, in civil actions and proceedings, with respect to an ele- ment of a claim or defense as to which State law supplies the rule of decision, the privilege of a witness, person, gov- ernment, State, or political subdivision thereof shall be determined in accord- ance with State law. (emphasis added). Accordingly, Mary- land law governing applicability and waiver of the attorney client privilege sul plies the rule of decision. F.H. Chase Clark/Gilford, 341 F.Supp.2d 562, 5 (D.Md.2004) (fmding that Maryland law governed whether inadvertent production waived attorney client privilege in a di- versity breach of contract case) "s. In Elkton *767 are Center Associates, Ltd Partnership I Quality Care Management, 145 Md.App. 532, 805 A.2d 1177 (2002), the Maryland Court of Special Appeals sur- veyed the law relating to inadvertent waiver of the attorney client privilege, not- ing that three distinct approaches had been followed by courts within the United States: a strict waiver approach, fmding waiver whenever a non-privileged disclos- ure occurs; a lenient approach: finding waiver only in the instance of an mtention- al waiver by the holder of the privilege; and an intermediate approach, which con- siders multiple factors to determine wheth- er a waiver should be found. Elkton Care, 145 Md.App. at 544-45, 805 A.2d 1177. The court adopted the intermediate ap- proach, which requires a court to consider: " `(1) the reasonableness of the precautions taken to prevent inadvertent disclosure in view of the extent of the ... production; (2) the number of inadvertent disclosures,• (3) the extent of the disclosure; (4) any delay and measures taken to rectify the disclos- ure; and (5) whether the overriding in- terests of justice would or would not be served by relieving a party of its error.' " Id. Applying these factors to the present case compels the conclusion that the priv- ilege has been waived by the inadvertent posting of the privileged communications on cnacentral.com. First, CNA failed to take sufficient precautions to prevent the inadvertent disclosure of the pnvileged in- formation. Despite the existence of a re- cognized procedure to mark such commu- nications "confidential"-with a simple "mouse click"-at the time of their creation, Mr. Hoefer, an experienced claims consult- ant, repeatedly posted email from CLEM and coverage counsel containing their ana- lysis of the coverage issues, as well as posting entries paraphrasing their views. There were multiple postings over an ex- tended period of time-from August 18, 2006 through November 22, 2006. The re- petitive failure to adhere to the established policy demonstrates that reasonable pre- cautions were not taken. Second, there were a minimum of eight privileged com- munications posted, during this extended O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. hups://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F9&destination=atpitutid=... 9/26/2011 EFTA00177929

Page 7 of 16 Page 7 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) period, hardly a one-time occurrence. Third, the disclosure was extensive, out- lining the very rationale for abandoning what appeared to be the initial decision to provide Under Armour with a defense un- der a reservation of rights, in favor of a de- cision to deny any coverage-defense or in- demnification-and file a declaratory judg- ment action. Fourth, while counsel for CNA responded immediately after notifica- tion by counsel for Under Armour that it had received the .pdf file and that it ap- peared to contain privileged communica- tions, this does not vitiate the fact that this action took place in July, 2007. The post- ings on the website remained there from their inception between August and November, 2006, despite the fact that Mr. Hoefer must have reviewed the website many times during that period, yet evid- ently never realized what should have been immediately apparent-he had forgotten to designate the information as confidential and posted it where it could be read by third parties, including Under Armour's in- surance broker. Finally, the record is devoid of any facts that would indicate that there is any overriding interest of justice that would be served by relieving CNA of the consequences of its error. The disclos- ure was a result of the voluntary, albeit in- advertent, acts by Mr. Hoefer, and not be- cause *768 of any wrongdoing by Under Armour, or its insurance broker, Nfr. Peace of Frenkel and Co. FN3. The application of Fed.R.Evid. 501 in civil cases can be tricky. It is easiest to do where it is clear that either federal or state law governs the privilege determin- ation. Where both federal and state substantive law is applicable, such as a federal question case with sup- plemental state law claims, Rule 501 would seem to require that fed- eral privilege law control the feder- al claims, and state privilege law control the supplemental state law claims. Of course, in instances where both the federal and state privilege law is the same, there is no practical difficulty. However, sometimes the federal and state law is different. An example of this lies in the issue presented in this case. As discussed above, Maryland has adopted the intermediate of the three approaches to determining the result of an inadvertent disclosure of attorney client information. E/- ton Care Cm Assocs. Ltd. P'ship I. Quality Care Mgmt, 145 Md.App. 532, 543-45, 805 A.2d 1177 (2002). However, the Fourth Circuit Court of Appeals has not yet ruled on which of the three approaches should be followed. There are dis- trict court cases within the Fourth Circuit that have adopted the same intermediate approach as the Mary- land Court of Special ppeals, see e. . McCafferty's, Inc. The Bank o Glen Burnie, 179 .R.D. 163 .Md.I998) (adopting the interme- iate approach, and citing other dis- trict court cases within the Fourth Circuit that have done so). However, other district courts have questioned whether the Fourth Cir- cuit, if called upon to address this issue, would adopt the intermedi test, see, e.g., F.C. Cycles Int'l Fila Sport, 184 F.R.D. 64, (1998), and a recent examination of Fourth Circuit law regarding waiver of the attorney client privilege con- cluded that, based on its past de- cisions, the circuit was closely aligned with decisions from other O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. hups://web2.westlaw.com/print/printstretun.aspx7pbc=BC6E23F9&destination=atp&utid=... 9/26/2011 EFTA00177930

Page 8 of 16 Page 8 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) jurisdictions that have adopted the harshest of the three approaches to inadvertent disclosure of privileged information-namely that such dis- closure waive, the privilege. See, Obi e.g. Hopson Mayor and Council of Ba timore, 232 F.R.D. 228, 237-38, (D.Md.2005) (noting that Fourth Circuit cases appear to interpret the attorney client priv- ilege very strictly and appear to fa- vor the "strict liability" approach to inadvertent disclosure of priyileged information, under which waiver is the consequence of such disclos- ure). If a civil case in federal court contains claims governed by both federal and state substantive law, what law should the court apply when the federal privilege law is different from the state privilege law? This is a complex question, but it appears that the majority of courts that have faced it have held that federal privilege law trumps state law, because were it other- wise, the jury would be faced with a hopelessly confusing task. See, e.g., Hancock Hobbs, 967 F.2d 462, 466-67 ( lth Cir.1992) (applying federal rule of privilege to both fed- eral and state claims and finding that "it also would be impractical to apply two different rules of priv- ilege to the same evideny before a single jury."); Hancock . Dodson, 958 F.2d 1367, 1373 (6 Cir.1992) (holding that the existence of pen- dent state claim did not relieve the Court of its obligation to apply the federal law of Tivilege); Wm. 7'. Thompson Co. Gen. Nutrition Corp., 671 F.2 100, 104 (3d Cir.1982) (holding "that when there are federal law claims in a case also presenting state law claims, the fed- eral rule favoring admissibility ...I the controlling rule."); von Bulow von Bulow, 811 F.2d 136, 141 ( d Cir.I987) (holding that federal law controlled question of privilege where federal civil RICO claims were joined with state law claim ; Andritz Sprout-Bauer, Inc. Beazer East, Inc., 174 F.R.D. 6 632 (M.D.Pa.1997) ("In a federal question case with supplemental state law claims, the federal law of privileges governs the entire case."); In re Combustion, Inc., 161 F.R.D. 51, 54 (W.D.La.1995) (holding that "the federal law of privilege provides the rule of de- cision with respect to privilege is- sues affecting the discoverability of evidence in this federal question case involving pendent state law claims."; this result is consistent with "the general policies of the federal rules favoring fiformity and simplicity"); Tucker United States, 143 F.Supp.2d 61 , 622-25 (S.D.W.Va.2001) (finding federal privilege law, not state privilege law, applied to both FTCA and pen- dent state law claims ing6medical malpractice case); Syposs . United States, 179 F.R.D. 4 , 411 (W.D.N.Y.1998) (finding medical malpractice claim under the FTCA is a federal question case and there- fore the federal common law of ivileges applies). But see Sprague Thorn Americas, Inc., 129 F.3d 355, 1368-69 (10th Cir.1997) (suggesting that in case involving both federal claims and pendent state claims, "both bodies" of priv- ilege law should be considered); Motley 1. Marathon Oil Co., 71 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. hups://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F98cdestinationr-atp&utid—... 9/26/2011 EFTA00177931

Page 9 of 16 Page 9 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) F.3d 1547, 1551 (10th Cir.1995) (case involving federal and state claims; suggesting that for state claims, state -kw of privilege should apply); Ellis I. United States, 922 F.Supp. 539, 540 (D.Utah 1996) (finding the case does not involve a federal question and that Utah law, not federal law, "determines the ap- plicable clergy privilege."), 2 Stephen A. Saltzburg, Michael M. Martin & Daniel J. Capra, Federal Rules of Evidence Manual 501-9 (8th ed. 2002) ("We note that most Courts, when confronted with this question, have held that the federal law of privilege applies to both the federal claim and to the pendent state claim."). In this case, the un- derlying jurisdiction of this court is diversity of citizenship, and the parties have agreed that Maryland substantive law is controlling. Ac- cordingly, because this case presents only state law claims, fed- eral privilege law is inapplicable, and the Court is not called upon to select between potentially compet- ing versions of the law of privilege. In this regard, CNA argues that Peace violated the Terms of Service agreement for use of the cnacentral.com website, be- cause that agreement restricted access to the site "solely for [Frenkel's] ... own indi- vidual use", and prohibited him from du- plicatingt downloading, publishing, or oth- erwise distributing any material on the site for "any, purpose other than for [Frenkel's] ... own mdividual use". See Ex. C, Paper No. 28 CNA's Resp. to Under Armour's Mot. This argument is unpersuasive. First, the Terms of Service agreement, which CNA drafted, does not define "own indi- vidual use", and it must be read in the con- text of the entire agreement, and given a reasonable interpretation. As the Stoecker and Peace affidavits show, CNA permits independent insurance brokers access to the cnacentral.com website to enable them to determine premium costs and underwrite CNA insurance policies, and, once issued, to monitor claims relating to policies that have been issued to their clients by CNA. Peace's access to the website was entirely consistent with that permitted purpose. Further, it is clear that Frenkel and Co., as an independent insurance broker, owed a duty towards its client, which was Under Armour, not CNA. Indeed, Frenkel's web- site, http:// www. frenkel. corn the con- tents of which this court judicially noticed pursuant to Fed.R.Evid. 201, make it clear that as part of their services to their clients they "meet regularly with the insurance companies that assume your specific busi- ness risks, and navigate a claims process that can be tedious in hard and soft mar- kets alike". See Frenkel & Co, Inc., httpi/ www. cosmetic insurance. com, (last vis- ited Feb. 12, 2008) (emphasis added). Moreover, the courts of Maryland long have held that an insurance broker is an agent of its principal the entity that is seek- ing insurance, not the company isfing the policy. Am. Cas. Co. of Reading Ricas, 179 Md. 627, 631, 22 A.2d 484 1941) ( "Ordinarily, the relation between the in- sured and the broker is that between prin- cipal and agent. An insurance broker is or- dinarily employed by a person seeking in- surance, and when so employed, is to be distinguished from [the] ordinary insurance agent, who is employed by insurance com- panies to solicit and write iir ce by, in and the company."); Cooper . Berkshire Life Ins. Co., 148 Md.App. , 83, 810 A.2d 1045 (2002) ("[I]nsurance agents and brokers clearly owe a professionals duty to the insured. 'An agent, employed to effect 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.wesdaw.com/print/printstream.aspx?pbc=BC6E23F9&destination=atp&utid=... 9/26/2011 EFTA00177932

Page 10 of 16 Page 10 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) insurance, must exercise such reasonable skill and ordinary diligence as may fairly be expected from a person in his profession or situation, in doing what is necessary to effect a policy, in seeing that it effectually covers the property to be insured, in select- ing the insurer and so on'.... The failure to meet that duty allows a recovery in tort.") (internal citations omitted). It would be disingenuous of CNA to suggest that Fren- kel had any need for "individual use" of the cnacenttral.com website claims notes relating to the suit filed against Under Ar- mour by Topolewski America Inc. for any purpose other than to learn information re- garding the status of Under Armour's de- mand for coverage from CNA, which it had a legal duty to report to Under Armour. Any other reading of the language of the agreement would produce an absurd result. Similarly, the Terms of Service agreement permitted Frenkel to 'download, publish, modify or otherwise distribute any material on [the cnacentral.com] Site" for the same "individual use", which by necessity per- mitted its disclosure to Under Armour. Ac- cordingly, I find no merit in CNA's argu- ment that Peace's downloading to a .pdf file the contents of the cnacentral.com claims file relating to Under Armour's *769 claim and thereafter providing it to Under Armour, its principal, was in viola- tion of the Terms of Service Agreement. Accordingly, I find that the attorney client privilege has been waived as to the materi- als posted on cnacentral.com. 1" / FN4. Under Armour's motion only seeks a ruling by the Court regard- ing what use, if any, it may make of the privileged and protected inform- ation posted on cnacentral.com. It has neither argued nor briefed the issue of whether the disclosure amounted to subject matter waiver of the attorney client privilege. Be- cause this issue is not before the Court, this ruling addresses only the privileged materials actually posted and nothing more. 2. Waiver of Work Product Protection By Disclosure to An Adverse Party [3][4] The conclusion that the attorney client privilege has been waived as to the claims notes as a result of their inadvertent disclosure to Frenkel and Under Armour does not concomitantly compel the conclu- sion that they also have lost work product immunity. PM This is because: FNS. As I did with the attorney cli- ent analysis, I have assumed, without deciding, that the claims notes at issue would qualify as at- torney opinion work product. [t]he fora communication of the ui attorney-client does not priv- ilege auto- matically waive whatever work-product immunity that communication may also enjoy, as the two are independent and grounded on different policies. Waiver of the privilege should always be analyzed distinctly from waiver of work product, since the privilege is that of the client and the work product essentially protects the attorney's work and mental impressions from adversaries and third parties even when communicated to the client. Edna S. Epstein, The Attorney-Client Privilege and the Work-Product Doctrine i 608 (4th ed.2001). Because the work product doctrine is not a privilege, but rather a qualified immunity from discov- ery'" Fed.R.Evid. 501 is inapplicable, and Maryland law does not govern this waiver issue. Rather, federal law does, even though jurisdiction in this case is bottomed on di rsity of citizenship. United Coal Cos. I. Powell Constr., 839 @ 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F98cdestination=atp&utid=... 9/26/2011 EFTA00177933

Page 11 of 16 Page I I 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) F.2d 958, 966 (3d Cir.1988) (unlike the attorney client privilege, the work product doctrine is governed, even in di- versity r, by federal law); Coregis Ins. Co. Law Offices of Carole F. Ka- frissen, .C. 57 F'ed.Appx. 58, 60 (3d Cir.2003) (federal-not state-standard ap- plied in determining scope of work product privilege in diversity case); In re Powerhouse Licensing LLC, 441 F.3d 467, 472 (6th Cir.2006) ("In a diversity case, the court applies federal law to re- solve work product claims and state law to relive attorney-client claims."); Baker . Gen. Motors Corp., 209 F.3d 1051, 53 (8th Cir.2000) (federal courts apply state law to resolve attorney client pnvilege issues and federal law to re- solve work product issues, diversity cases); Frontier Ref. Inc. . Gorman- Rupp Co., 136 F.3d 695, 70 n. 10 (10th Cir.1998) ("[u]nlike the attorney client privilege, the work product [doctrine] is governed., even in diversity cases, by a uniform federal standard embodied in 26(7(3).1 N. ; Allied fish Banks Bank oaf America, A., 240 F.R.D. 6, 105 ( .D.N.Y.2007) ("While state law governs the question of attor- ney-client privilege in a diversity action federal law governs the applicability the work product doctrine.' ; Schipp Gen. Motors *770 Corp., 45 F. Supp d 917, 923 (E.D.Ark.2006) ("In a diversity case, the Court applies federal law to re- solve work product claims."); Bank of the West Valley Nat. Bank of Ariz., 132 F.R.D. 250 (N.D.Ca1.1990) (in diversity action, California law would govern res- olution of issues arising out of plaintiffs invocation of attorney client privile e whereas work product issues would resolved under federal law); Nicholas Bituminous Cas. Corp., 235 F.R.D. 32 , 329 n. 2 (N.D.W.Va.2006) ("In a di- versity case, federal courts apply federal law to resolve work-product privilege y claims and state law to resolve alto ey-cli- ent privilege claims."); Maertin . Arm- strong World Industries, Inc., 17 F.R.D. 143, 147 (D.N.J.1997) ("[T]he work product privilege is governed, even in di- versity cases, by iform federal law..."); S.D. Warren Co. I. E. Elect. Corp., dc 201 F.R.D. 280, 281 (D.Me.2001) federal courts apply federal law when ad ressing the work product doctrine, even in di- versity cases lacking any federal ques- tion); 8 Wright, Miller & Marcus, Feder- al Practice and Procedure: Civil 2d. § 2023 (2d ed. 1994) ("At least since the adoption of Rule 26(13)(3) in 1970, it has been clear that in federal court the ques- tion whether material is protected as work product is governed by federal law even if the case is in court solely on grounds of diversity of citizenship.") J. FN6. Musselman I Phillips, 176 F.R.D. 194, 195 n. 1 (D.Md.1997) (collecting luthority); Nutramax Labs., Inc. . Twin Laboratories Inc., 183 F. .D. 458, 463, n. 8 (D.Md.1998); 8 Charles Alan Wright, Arthur R. Miller & Richard L. Marcus, Federal Practice and Procedure: Civil 2d § 2023 at 335 (2d ed.1994)(work product materi- als are not beyond the scope of dis- covery on grounds of "privilege"). FN7. However, the result almost certainly would be the same even if Maryland law controlled. In Mary- land, the work product doctrine has been codified at Maryland Rule 2-402(d), the text of which is sub- stantially identical to Fed.R.Civ.P. 26(bX3). Moreover, Maryland O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F9&destination=atp&utid—... 9/26/2011 EFTA00177934

Page 12 of 16 Page 12 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) courts long have cited federal cases when ruling on issues involving the work product doctrine in step cases. See, e.g. Balt. Transit Co. Mezzanotti, 227 Md. 8, 14.p. 2, 174 A.2d 768 (citing Hickman I Taylor, 329 U.S. 495, 67 S.Ct. 385, 91 L.Ed. 451 (1947) as authority in in- terpreting the workproduct doctrine i under Maryland law • E.I.du Pont de Nemours & Co. Forma-Pack Inc., 351 Md. 396, 07, 718 A.2d 1129 (1998) (citing federal law in interpreting work product doctri under Maryland law); Gallagher Office of the Airy Gen., 1 Ivid.App. 664, 677, 787 A.2d 777 (2001) (citing federal cases in eval- uating whether, under Maryland law, work product protection had been waived); Elkton Care, 145 Md.App. at 543, 805 A.2d 1177 (citing federal case law in determin- ing whether, under Maryland law, work product protegtion had been waived); DeVetter I. Alex. Brown Mgmt. Svcs., Inc., No. 24-C-03-007514, 2006 WL 1314014, at * 11 (Md.Cir.Ct. Mar.22, 2006) (citing federal case law in deciding issue of whether work product protection was waived, under Maryland law). CNA cotitePtig that under Fp urth Cir- • such as the email froms&yeragesci CLEM _ counsel and Hoefer's chatacterizatimilt 1 anal sis, is afforded immune" or "nearly a' so utely 4mmune frel11-61164" *uamel- ert zwal°—anICSA wah this point, ut it is irre event. under Armour does not seek discovery pursuant to Fed.R.Civ.P. 34 of the claims notes that Hoefer posted on cnacent- ral.com. They were obtained by Under Ar- mour from its insurance broker, Frenkel, entirely outside of the discovery process. The issue presented in this case is not whether the opinion work product con- tained in the claims notes can be dis- covered, but whether its inadvertent post- ing prior to the filing of this lawsuit on a website to which CNA's adversary, Under Armour, had been given access, waives work product protection. And, as will be *771 seen, the Fourth Circuit clearly has recognized that opinion work product pro- tection, however exalted and immune from discovery, may nonetheless be waived. 8. See, e.g. In re Allen, 106 F.3d 582, 607 (4th Cir.1997) (opinion work product enjoys "nearly abso- lute" immunity from discovery); Nat'l Union Fire Ins. Co. . Murray Sheet Metal Co., 967 F.2 980, 984 (4th Cir.1992) (opinion work product "absolutely immune" fro discovery); Nutramax Labs., Inc. r Twin Labs., Inc. 183 F.R.D. 45 , 462 (D.Md.1998) (under Fourth Circuit case law opinion work product has [been] characterized variously as "absolutely immune" or "nearly absolutely immune" from discovery, collecting cases). In Duplan Corp.'. Deering Milliken Inc., 540 F.2d 1215 (4th Cir.1976), the Fourth Circuit held that work product pro- tected information that had been produced either voluntarily or inadvertently to an ad- versary did not result in subject matter waiver, as would be the case for attorney client privileged materials. The court sum- marized its holding as follows: Thus, to the extent that a concept of sub- ject matter waiver is applicable to Rule 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspepbc—BC6E23F9&destination=atptautid=... 9/26/2011 EFTA00177935

Page 13 of 16 Page 13 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) 26(bX3) under the rationale of the Nobles F149 case which held that testimonial use of work product constituted waiver, we are of [the] opinion it does not extend to a case such as this where there has been only inadvertent or partial disclosure in response to specific inquires, and in which no testimonial use has been made of the work product. FN9. Referring to United States S.C. I Nobles, 422 U.S. 225, 95 . 2160, 45 L.Ed.2d 141 (1975). Duplan, 540 F.2d at 1223. Of course, the subject of the Duplan case was the ex- tent to which the inadvertent or partial pro- duction constituted a waiver, and if so, whether additional discovery of protected materials was warranted. It did not attempt a comprehensive analysis of the underlying circumstances that would trigger a waiver in the first instance. Implicit m the conclu- sion that broad subject matter waiver did not apply to opinion work product is an ac- knowledgment that the inadvertent produc- tion of opinion work product could result in more limited waiver, as to the materials actually produced. This concept was clari- fied further y the Court in Martin Mari- etta Corp. . Pollard, 856 F.2d 619, 626 i (4th Cir.19 ), where it stated: irst and most generally, opinion work product is to be accorded great protection by the courts. While certainly actual dis- closure of pure mental impressions may be deemed waiver, and while conceivably there may be indirect waiver in extreme I circumstances we think generally such work product is not subject to discovery. (emphasis added). The Fourth Circuit more comprehensively addressed the cir- cumstances that could result in the waiver if Uonite ppinion swtaotrk p , 662 F. 2rr d iciiio3n ( t , 1081 h Cir. 1981), where it ruled: Recent decisions considering [ waiver of work product protection] ... have fo- cused on a concern inherent in the work product rule: that since an attor- ney's work is for his client's advantage, opposing counsel or adverse parties should not gain the use of that work through discovery. The attorney and client can forfeit this advantage, but their actions effecting the forfeiture or waiver must be consistent with a con- scious disregard of the advantage that is otherwise protected by the work product rule. Disclosure to a person with an interest common to that of the attorney or the client normally is not inconsistent with an intent to invoke the work product doctrine's protection and would not amount to such a waiver . However, when an attorney freely and voluntarily discloses the contents of otherwise protected work product to someone with interests adverse to his or those of the client, knowingly in- creasing the possibility that an oppon- ent will obtain and use the material, he may be deemed to have waived work product protection .... Additionally, re- lease of otherwise protected withott intent to limit its future dis- position_ might forfeit work product *772 kroteetion, regardless of the rela- tiotillup between the Attorney nd the-recipient of the material. Ia oilier words, to effect a_farfeatur-E4Ttirark product protection by waiver disclosure must occur in circuitillances-zWlilikh the attorney cannot reasonably_expect to „ limit the future use of the othemisipro- tected material (emphasis added). O 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx7pbc=BC6E23F98cdestination=atpautid=... 9/26/2011 EFTA00177936

Page 14 of 16 Page 14 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) [5] The notion that disclosure of work product protected material in a manner that creates a substantial risk that it will be re- ceived by an adversary waives the protec- tion because it cannot be expect& thatrthe ited-trg nrnon sense proposition tit lf glas future use of information-caul been-retbrnila by other co H and—Com- cmentatorrfor the simple reason that once an-adversary has become aware of the con- teitt—orThe information disclosed it cannot ptynE3it rom_its rniiid:-This principle las been stated authoritatively as follows: "Work-product immunity is waived if the client, the client's lawyer, or another au- thorized agent of the client: ... (4) discloses the material to third persons m earcuin. stames in which there is a si tticant like- liheod--that an adversary or potential a - it'._ Restatement (Third) of the Law ov- ening Lawyers § 91 (2000). The notion is that failure to take adequate precautions to prevent an adversary from obtaining work product information warrants waiver be- cause "Wndifference to such a con- sequence indicates that protection of the immunity was not important to the person claiming the protection." § 91 cmt. b. Fur- ther, as long as the disclosure was volun- tary, waiver results, even if it was not con- sensual. § 91, cmt. a ("Most decided cases of waiver involve actions of the attorney or client that are voluntary, but not eiplicitly consensual."). See, e.g GAF Corp. t. East- man Kodak Co., 83 F.R.D. 46, 51-52 (D.C.N.Y.1979), abrogated on other grounds by In re Steinhardt Partners, 9 F.3d 230, 233 (2d Cir.1993) ("The majority rule provides that disclosure of the priv- ileged information by the party asserting the attorney work product privilege to a third-party does not constitute waiver un- less such disclosure, under the circum- stances, is inconsistent with the mainten- ance of secrecy from the disclosing party's adversary. Therefore, only if such disclos- ure substantially increases the possibility that an opposing party could obtain the in- formation disclosed will the disclosing party's work product privilege be deemed waived. This majority rule reflects the pur- pose of the work product privilege which is to prevent an opposing party from securing the protected information rather than to prevent the outside world generally from obtaining the information.") (internal cita- tions mined); o Niagara Mohawk Power Corgi. Stone & Webster Eng'g Corp., 125 F.R.D. 578, 587 (N.D.N.Y.1989) ("Mork product protection is waived when protec- ted materials are disclosed in a manner which `substantially increases the oppor- tunity for potential adverse•s to obtain the information' ".); Carter Gibbs, 909 F.2d 1450, 1451 (Fed.Cir.1990) (Fed.Cir.1990) (en bane), superseded in non-relevant part. Pub.L. No. 103-424, § 9(c). 108el at. 4361 (1994), as recogniz in Mudge . United States, 308 F.3d 1220, 1223 (F .Cir.2002) ("Assuming the mo- tion to strike asserts the work product as well as the attorney-client privilege, we be- lieve the government has waived the former by voluntarily attaching a copy of the offending memorandum to appellants' copy of the motion for an extension of time. It is irrelevant whether the attachment was inadvertent, as the government alleges. Voluntary disclosure of attorney work product to an adversary in the litigation for which the attorney produced that informa- tion )3 defeats the policy underlying *7 the privilege."); Frank Betz Assocs., Inc. . Jim Walter Homes, Inc., 226 F.R.D. 53 , 535 (D.S.C.2005) (finding that "courts gener- ally find a waiver of the work product priv- ilege only if the disclosure substantially in- creases the opportunity for potential ad- versaries to obtain the information.") 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F98cdestination=atpecutid=... 9/26/2011 EFTA00177937

Page 15 of 16 Page 15 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) (quoting nig251i71 (z DG.NrarNiflo itz, q5n6telrnFaiSu quo- tations omitted); 8 Wright, Miller & Niar- cus, Federal Practice and Procedure; Civil 2d § 2024 at 369 (2d ed. 1994) ("Mts, the result should_ be that disclosure of a docu- ment to third persons_does not waive—ffe work-pmdiietimmuniV unless it hes sub- stanti eased—the opportunities ir tent ies to obtain the informa- l; 6 James Wm. Moore, et Moore's Federal Practice § 26.70[6][c] (3d ed.2004) at 26-167 ("Because the work product privilege is intended to protect the adversary process, some cases draw a dis- tinction between disclosures made to non- adversaries and disclosures made to ad- versaries. While disclosures made to non- adversaries do not necessarily waive the work product privilege, a disclosure only to one adversary waives the privilege as against all other adversaries. F rthermore a party may not avoid waiver asse p "fh ete ip:inof--th - material to ventry."). [6][7] In this case, CNA's disclosi of the opinion work product of its CI and coverage counsel was made to Mir Peace of Frenkel and Co, who was Armour's agent. Disclosure to an agf tantamount to disclosure to the pnr 196 See MW. Life Ins. Co. of New Y Hilton-Green, 241 U.S. 613, 622, 3i rule which imputes an aen s to the principal is well established. deriving reason for it is that an thira party may properly presume will perform his duty and report which affect the principal's inter statement (Second) of Agency 2 (1958) ("The principal is affected by the knowledge which the agent has when act- 676, 60 L.Ed. 1202 (1916) c'The 19-a/ knr Qt el al., ing for him or, if it is the duty of the agent to communicate the information and not otherwise to act, the principal is affected after the lapse of' such time as is reasonable for its communication."). Accordingly, by disclosing the content of protected opinion work product to its adversfiry-Under Ar- mour-CNA cannot now maintain that the protection continues to exist. As a matter of law the protection has been waived. As a practical matter, no other result makes sense. CNA cannot expect to limit the fu- ture use by Under Armour of the protected material it disclosed. Neither Under Ar- mour nor its counsel can purge from their consciousness this information that they re- reivecl not through any wrongdoing of their • rather, as a result of the volun- aIction ofr CNA. J4.17 7;10 1C t;ton ey-cLI )-3 .\Atex pkir: -,Pep F-No 4A-f! )-tyg 9 t )%fm g) /Wu.- 42) 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. https://web2.westlaw.com/print/printstream.aspx7pbc—BC6E23F9&destination=atp&utid=... 9/26/2011 EFTA00177938

Page 16 of 16 537 F.Supp.2d 761 (Cite as: 537 F.Supp.2d 761) 26.70[6][c] (3d ed.2004) at 26-467 CA waiver of work-product protection encom- msses only the items actually disclosed. Thus, disclosure of some documents does not imply that work product protection has been destroyed for other documents of the same character."). Having found that both the attorney cli- ent privilege and work product protection have been waived as to the claims notes posted by Mr. Hoefer on cnacentral.com, CNA is at liberty to use those materials, to the extent that they are relevant and other- wise admissible in the pending lawsuit. D.Md.,2008. Continental Cas. Co. I. Under Armour, Inc. 537 F.Supp.2d 761 END OF DOCUMENT 2011 Thomson Reuters. No Claim to Orig. US Gov. Works. Page 16 https://web2.westlaw.com/print/printstream.aspx?pbc=BC6E23F9&destination=atp&utid=... 9/26/2011 EFTA00177939

Case 9:08-cv-80736-KAM Document 94 Entered on FLSD Docket 09/02/2011 Page 1 of 23 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA CASE No. 08-80736-CIV-MARRA/JOHNSON JANE DOE I and JANE DOE 2, Plaintiffs, 1. UNITED STATES OF AMERICA, Defendant. SUPPLEMENTAL BRIEFING IN SUPPORT OF MOTION TO INTERVENE OF ROY BLACK, MARTIN WEINBERG, AND JAY LEFKOWITZ During the hearing on August 12, 2011, the Court directed the proposed intervenors to file additional briefing on their argument that plea negotiations arc privileged and not subject to discovery or use as evidence in these proceedings. Proposed intervenors submit the following memorandum of law, which is identical to Parts 1 and II of the memorandum of law submitted by proposed intervenor Jeffrey Epstein in support of his motion for a protective order and his opposition to the motions of the plaintiffs for production, use, and disclosure of his plea negotiations. If allowed to intervene, the lawyers would incorporate these arguments into their motion for a protective order, which was attached to their initial motion to intervene. Established case law as well as sound and substantial policy considerations prohibit disclosure of the letters and emails prepared by Mr. Epstein's lawyers during plea negotiations with the government, and require that the letters and emails that Jane Doe I and Jane Doe 2 already have remain confidential. In support of their position, proposed intervenors submit this memorandum EFTA00177940

Case 9:08-cv-80736-KAM Document 94 Entered on FLSD Docket 09/02/2011 Page 2 of 23 of law. Part I shows that the Court should deny disclosure and use of the plea negotiations by simple reference to Rule of Evidence 410 and Federal Rule of Criminal Procedure 11(f), without having to reach the other issues raised by the parties and the proposed intervenors. This is because during the hearing on August 12, 2011, Jane Doe 1 and Jane Doe 2 admitted that they intend to use the plea negotiation letters and emails as substantive evidence at a "remedies hearing" where they will seek invalidation of Mr. Epstein's Non-Prosecution Agreement. Using this correspondence as evidence against Mr. Epstein is plainly prohibited by Evidence Rule 410 and Criminal Rule 11. Part II of this memorandum shows that Jane Doe I and Jane Doe 2 are not entitled to discovery or use of the plea negotiations not only because of the reach of Rules 410 and 11, but also because plea negotiations enjoy an evidentiary privilege as recognized by the Supreme Court in United States' Mezzanatto, 513 U.S. 196, 204 (1995) ("Rules 410 and 11(eX6) sewage], in effect, a privilege of the defendant,' and, like other evidentiary privileges, this one may be waived or varied at the defendant's request"). Additionally, because plea negotiations are "rooted in the imperative need for confidence and trust," and because their confidentiality serves significant public and private ends, they are properly subject to a common law privilege under Federal Rule•of Evidence 501. Similar privileges, which are "rooted in the imperative need for confidence and trust" and which serve significant public and private ends, have been recognized by Judge Marcus in the case of In Re Air Crash Near Cali, Colombia, 959 F. Supp. 1529 (S.D. Fla. 1997); by Chief Judge Vinson of the Northern District of Florida in Reichhold Chemicals, Inc.. Textron, Inc., 157 F.R.D. 522 (N.D. Fla. 1994); and by a number of district courts recognizing a mediation privilege which shields from disclosure and use mediation documents, letters, and communications. 2 EFTA00177941

Case 9:08-cv-80736-KAM Document 94 Entered on FLSD Docket 09/02/2011 Page 3 of 23 PART I A. PLEA NEGOTIATIONS MAY NOT BE USED AGAINST MR. EPSTEIN UNDER THE PLAIN LANGUAGE OF THE FEDERAL RULES The Court should deny disclosure and use of the plea negotiations by simple reference to Rule of Evidence 410 and Rule of Criminal Procedure 11(f), without having to reach the other issues raised by the parties and the proposed intervenors. During the August 12, 2011 hearing, the plainti ffs admitted that they seek the defense letters and emails to offer them as evidence to support their request that the Court invalidate Mr. Epstein's Non-Prosecution Agreement. According to the plaintiffs, the plea negotiations will show that Mr. Epstein supposedly "engineered" and "orchestrated" the claimed Crime Victims' Rights Acts violations and that therefore the plaintiffs are entitled to negate Mr. Epstein's interest in the protections and finality of the Non-Prosecution Agreement. [August 12, 2011 Trans. at 33-34, 61, 107-09]. The letters and cmails exchanged between the government and defense counsel during plea negotiations are classic settlement discussions, written with the intention that they remain confidential. As such, they are protected by the constitutional right to effective assistance of counsel and the express language of Rule 410 and Federal Rule of Criminal Procedure 11(0. FED. R. EvID. 410 (discussions made during plea negotiations are "not, in any civil or criminal proceeding, admissible against the defendant who .. . was a participant in the plea discussions"); FED. R. CRIM. P. 11(0 ("the admissibility or inadmissibility of . . . a plea discussion and any related statement is governed by Federal Rule of Evidence 410"). Obviously, the plaintiffs intend to use the plea negotiation letters "against" Mr. Epstein. They protested during the August 12 hearing that the letters would be offered "against the 3 EFTA00177942

Cse 9:08-cv-80736-KAM Document 94 Entered on FLSD Docket 09/02/2011 Page 4 of 23 government" and "not against Mr. Epstein," but this is disingenuous given their emphatic and categorical representations to the contrary. [Compare Trans. at 29-30 with Trans. at 33-34, 61, 107- 09]. The plaintiffs' arguments and accusations throughout this litigation, including the various conspiracy allegations leveled against Mr. Epstein during the August 12 hearing, establish that the plaintiffs' true purpose is to use the plea negotiations against Mr. Epstein in the current proceeding. The prohibition on admission of plea negotiation communications clearly extends to the current proceeding, whether it is denominated a quasi-criminal or a civil proceeding. The committee notes to former Rule 11(0)(6), which read almost identical to Rule 410, specifically state that the words "not . . . admissible against the defendant' refer to "the purpose for which [the evidence] is offered" and not "to the kind of proceeding in which the evidence is offered." FED. R. CRIM. PRO. 11 advisory committee note 1979 amendment (emphasis added). Rule 11 was amended in 1979 specifically to avoid confusion or misunderstanding regarding this phrase, and to emphasize that "against the defendant" means "the purpose" for which the evidence is being used: The phrase "in any civil or criminal proceeding" has been moved from its present position, following the word "against," for purposes of clarity. An ambiguity presently exists because the word "against" may be read as referring either to the kind of proceeding in which the evidence is offered or the purpose for which is offered. The change makes it clear that the latter construction is correct. Committee on Rules of Practice And Procedure of The Judicial Conference of The United States, Standing Committee On Rules of Practice And Procedure, 77 F.R.D. 507, 538 (February 1978) (emphasis added). Even though the plaintiffs claim that they would technically offerthe plea negotiation letters against the government because the government is its opponent, their real and express purpose is to offer the plea negotiations against Mr. Epstein to prove his supposed culpability in encouraging the 4 EFTA00177943

se 9:08-cv-80736-KAM Document 94 Entered on FLSD Docket 09/02/2011 Page 5 of 23 government to breach what the plaintiffs contend is their statutory right to consultation, and to then seek the unprecedented and unconstitutional remedy of invalidation of the Non-Prosecution Agreement despite the fact that Mr. Epstein has already suffered all of its penal and adverse collateral consequences: jail, community custody, payment of substantial legal fees to an attorney representative for his accusers, payment of substantial civil settlements driven by waivers negotiated by the government to facilitate its witnesses bringing successful civil lawsuits, and registration requirements. Rules 410 and 11 plainly prohibit admission of the plea communications. B. BECAUSE PLEA NEGOTIATIONS ARE INADMISSIBLE, THE PLAINTIFFS BEAR THE BURDEN OF PARTICULARIZING A PROPER BASIS FOR DISCOVERY When a discovery request seeks "information subject to exclusion under the Federal Rules of Evidence, such as settlement information, ... many courts shift the burden to the requesting party, requiring them to make a particularized showing that the inadmissible evidence is likely to lead to admissible evidence." Reisti Source Interlink Co., 2010 WL 4940096 at *2 (M.D. Fla. Nov. 29, 2010); Bottum. Hatton Assocs., 96 F.R.D. 158, 159-60 (E.D.N.Y. 1982) ("the object of the inquiry must have some evidentiary value before an order to compel disclosure of otherwise inadmissible material will issue"). Such a burden-shifting analysis is particularly important where the discovery is protected by a rule of inadmissibility, where the plaintiffs have not identified any principled basis for discovery other than to seek to admit the plea communications in evidence, and where the policies behind the rule of inadmissibility would be compromised by any disclosure, regardless of whether the communications are later excluded as evidence in proceedings in this case. The plaintiffs in Bottum sued a number of defendants for securities fraud. One defendant 5 EFTA00177944

Case 9:08-cv-80736-KAM Document 94 Entered on FLSD Docket 09/02/2011 Page 6 of 23 settled and was dismissed from the lawsuit. The remaining defendants later moved to compel disclosure of the settlement agreement. In denying the motion to compel, the Court recognized the strong public policy favoring settlements, and the need to encourage settlements by ensuring against "unnecessary intrusion" into "the bargaining table." Id. at 160. For this reason, the Court held, parties seeking discovery of inadmissible settlement negotiations must first make a "particularized showing of a likelihood that admissible evidence will be generated" by their discovery request: Given the strong public policy of favoring settlements and the congressional intent to further that policy by insulating the bargaining table from unnecessary intrusions, we think the better rule is to require some particularized showing of a likelihood that admissible evidence will be generated by the dissemination of the terms of a settlement agreement. Since the terms of settlement do not appear to be reasonably calculated to lead to discovery of admissible evidence and the defendants have not made any showing to the contrary, this justification for [discovery] must fail. Id.; accord Reist, 2010 WL 4940096 at *2 (recognizing the "chilling effect" that discovery can have on the willingness of parties to enter into settlement negotiations). Other than their conclusory statement during the August 12 hearing that the plea negotiations would be used against the government and not Mr. Epstein, the plaintiffs have not made any particularized showing to convince this Court that any admissible evidence would result from their discovery of the plea negotiations. Accordingly, their request for discovery of clearly inadmissible evidence should be denied. C. THE PLEA NEGOTIATIONS ARE IRRELEVANT BECAUSE THE PLAINTIFFS ARE NOT ENTITLED To INVALIDATE THE NON-PROSECUTION AGREEMENT Additionally, the purpose for which the plaintiffs seek the plea negotiation letters — to set aside the Non-Prosecution Agreement — is a remedy that, if granted, would violate the Constitution and the statutory rights of both the government and Mr. Epstein. It would also be extraordinarily 6 EFTA00177945

Case 9:08-cv-80736-KAM Document 94 Entered on FLSD Docket 09/02./2011 Page 7 of 23 inequitable given that while the plaintiffs failed to urge that this Court resolve their Complaint as an exigent or emergency matter, Mr. Epstein served the entirety of a prison sentence that resulted from obligations imposed upon him by the Non-Prosecution Agreement. He also served the entire community control consecutive sentence, and pursuant to the Non-Prosecution Agreement, he made payments of huge sums of money to the attorney representative of certain claimants. Finally, Mr. Epstein settled cases because of waivers within the Non-Prosecution Agreement. Under the Crime Victims' Rights Act, neither Jane Doe I nor Jane Doe 2 can invalidate the Non-Prosecution Agreement. The Act expressly prohibits it: "Nothing in this chapter shall be construed to impair the prosecutorial discretion of the Attorney General or any officer under his direction." 18 U.S.C. § 3771(d)(6). Under the Crime Victims' Rights Act, neither Jane Doe I nor Jane Doe 2 can invalidate the Non-Prosecution Agreement. The Act expressly prohibits it: "Nothing in this chapter shall be construed to impair the prosecutorial discretion of the Attorney General or any officer under his direction." 18 U.S.C. § 3771(d)(6). The Act codifies the long-standing principle that "[t]he Attorney General and United States Attorneys retain broad discretion to enforce the Nation's criminal laws." United Stalest Armstrong, 517 U.S. 456, 464 (1996). This is due in large part to the separation of powers doctrine. Id.; U.S. CONST. art. II, § 3. Whether to investigate possible criminal conduct, grant immunity, negotiate a plea, or dismiss charges, are all central to the prosecutor's executive function. United States'. Smith, 231 F.3d 800, 807 .(11th Cir. 2000). "The judiciary cannot interfere with a prosecutor's charging discretion, except in narrow circumstances where it is necessary to do so in order to discharge the judicial function of interpreting the Constitution." Id. And this Court has not been 7 EFTA00177946