Elan Microelectronics Corporation v. Apple, Inc.

Filing 306

Declaration of Derek C. Walter in Support of Apple's Reply to Elan's Opposition to Motion to Compel filed byApple, Inc.. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Exhibit F, # 7 Exhibit G, # 8 Exhibit H, # 9 Exhibit I, # 10 Exhibit J, # 11 Exhibit K)(Mehta, Sonal) (Filed on 6/21/2011)

Exhibit F

LEXSEE

Caution
As of: Jun 21, 2011
A.I.A. HOLDINGS, S.A., et al., Plaintiffs, -against-LEHMAN BROTHERS, INC.
and BEAR STEARNS & CO., INC., Defendants.
97 Civ. 4978 (LMM)(HBP)
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF
NEW YORK
2002 U.S. Dist. LEXIS 20107

October 18, 2002, Decided
October 21, 2002, Filed
DISPOSITION:
[*1] Plaintiff's and defendant's
motions to compel denied in all respects.
CASE SUMMARY:

PROCEDURAL POSTURE: Plaintiffs sought to
compel production of numerous documents that were
withheld on the basis of privilege and work product.
Defendant sought to compel non-party witnesses to
produce certain documents withheld on the ground of
work product.
OVERVIEW: Plaintiffs argued that defendant one's
index of withheld documents did not set forth sufficient
facts to support its assertions of privilege and work
product. The court disagreed because defendant one has
submitted affidavits that filled in the gaps asserted by
plaintiffs, and so had sustained its burden of proof.
Plaintiffs then argued that a substantial number of
documents withheld on the basis of work product should
have been produced because plaintiffs had a substantial
need for the information, and were unable to obtain that
information from any alternative source. However, the
court denied the motion to compel because plaintiffs
failed to offer any evidence that they were unable to
obtain the information from other sources. Defendant two

also sought to compel production of documents from
non-party witnesses, but the court denied the motion
because defendant two was able to depose the witnesses,
and so did not have a substantial need for production of
documents.
OUTCOME: Plaintiffs' motion to compel production
and defendant's motion to compel production were both
denied.
CORE TERMS: withheld, work product, discovery,
non-party, tape, work-product, impeachment, log,
privileged, interview, compel production, applicability,
proponent, claim of privilege, specific facts, withholding,
tape recording, disclosure, deposition, facts establishing,
burden of proof, evidentiary, recipient, facially, pierce,
Federal Rules, information required, subject matter,
deposition testimony, attorney-client
LexisNexis(R) Headnotes

Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN1]See Fed. R. Civ. P. 26(b)(5).
Page 1

2002 U.S. Dist. LEXIS 20107, *1

Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN2]See U.S. Dist. Ct., S.D. N.Y., R. 26.2.
Civil Procedure > Discovery > Methods > Requests for
Production & Inspection
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN3]Fed. R. Civ. P. 26(b)(5) was not intended to
establish rigid requirements concerning the information
disclosed in an index of a withheld documents: The
withholding party must provide sufficient information to
enable other parties to evaluate the applicability of the
claimed privilege or protection. Although the person from
whom the discovery is sought decides whether to claim a
privilege or protection, the court ultimately decides
whether, if this claim is challenged, the privilege or
protection applies. Providing information pertinent to the
applicability of the privilege or protection should reduce
the need for in camera examination of the documents.
The rule does not attempt to define for each case what
information must be provided when a party asserts a
claim of privilege or work product protection. Details
concerning time, persons, general subject matter etc.,
may be appropriate if only a few items are withheld, but
may be unduly burdensome when voluminous documents
are claimed to be privileged or protected.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN4]The index of withheld documents need not
establish all the elements of a privilege by itself.
Typically privilege logs will identify each document and
the individuals who were parties to the communications,
providing sufficient detail to permit a judgment as to
whether the document is at least potentially protected
from disclosure. Other required information, such as the
relationship between the individuals listed in the log and
the litigating parties, the maintenance of confidentiality
and the reasons for any disclosures of the document to
individuals not normally within the privileged
relationship, is then typically supplied by affidavit or
deposition testimony.
Evidence > Privileges > Attorney-Client Privilege >
Elements
Evidence > Privileges > Attorney-Client Privilege >
Scope

Legal Ethics > Practice Qualifications
[HN5]One element of the attorney-client privilege is that
the attorney must actually be admitted to the bar of a state
or federal court. Although, the privilege has been
extended to cover communications with an attorney's
subordinate, the privilege requires that there be a
communication intended to reach, either directly or
indirectly, an attorney admitted to practice. Thus, in the
absence of an excusable mistake of fact, even if all the
other requirements of the privilege are met,
communications between a client and an unadmitted law
school graduate are not privileged even where the
putative attorney has passed the bar examination.
Civil Procedure > Counsel > General Overview
Civil Procedure > Discovery > Methods > General
Overview
Legal Ethics > Practice Qualifications
[HN6]Neither Fed. R. Civ. P. 26(b)(5) nor U.S. Dist. Ct.,
S.D. N.Y., R. 26.2 require an allegation of specific facts
establishing an attorney's admission to the bar at the time
of an allegedly privileged communication.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN7]The ultimate determination of the availability of a
privilege was based on an adequately detailed privilege
log, in conjunction with evidentiary submissions to fill in
any factual gaps.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
Evidence > Privileges > General Overview
Evidence > Procedural Considerations > Burdens of
Proof > Ultimate Burden of Persuasion
[HN8]Although it is clear that the proponent of the
privilege ultimately bears the burden of proving all
essential facts necessary to sustain a claim of privilege,
the law is not entirely clear as to how this burden may be
discharged where the proponent has served a detailed
index of documents withheld, and the challenger has
submitted specific challenges. Where the defendant does
not generally challenge the adequacy of plaintiff's index,
it appears that the proponent of the privilege may satisfy
its burden by submitting evidentiary material as to the
challenged elements only. Requiring the proponent to
submit evidentiary material to prove all elements of the
privilege in response to a specific challenge unduly
Page 2

2002 U.S. Dist. LEXIS 20107, *1

burdens and wastes the time of both the court and the
parties. A party asserting a claim of privilege is obligated
to prepare an index of withheld documents, which must
provide sufficient information to assess the applicability
of the privilege or protection. Fed. R. Civ. P. 26(b)(5).
Thus, a party challenging an assertion of privilege is
given the information necessary to state the grounds of its
challenge and is not left to guess at the nature of what's
being withheld and why. Since the challenger is given
this information, there is no logic or efficiency in
requiring the proponent of a privilege or the court to
address matters which are not contested by the
challenger.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
Evidence > Privileges > General Overview
Evidence > Procedural Considerations > Burdens of
Proof > Ultimate Burden of Persuasion
[HN9]The withholding party's initial obligation is to
prepare an index of withheld documents providing the
specific information required by Fed. R. Civ. P. 26(b)(5)
and U.S. Dist. Ct., S.D. N.Y., R. 26.2. If the assertions of
privilege are not challenged, the withholding party has no
further obligation with respect to its assertions of
privilege. If the assertions of privilege are challenged and
the dispute cannot be resolved informally, the
withholding party then has to submit evidence, by way of
affidavit, deposition testimony or otherwise, establishing
only the challenged elements of the applicable privilege
or protection, with the ultimate burden of proof resting
with the party asserting the privilege or protection.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN10]Where the information in the log of withheld
documents is insufficient to establish a factual basis for
the privilege, the proponent of the privilege bears the
burden of showing its applicability, a gap which often is
filled through an affidavit or deposition testimony.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN11]Where the applicability of the work product
doctrine has been established, factual material may,
nevertheless, be ordered produced upon a showing of
substantial need and inability to obtain the equivalent
without undue hardship. The substantial need

requirement is as follows: Where relevant and
non-privileged facts remain hidden in an attorney's file
and where production of those facts is essential to the
preparation of one's case, discovery may properly be had.
Such written statements and documents might, under
certain circumstances, be admissible in evidence or give
clues as to the existence or location of relevant facts. Or
they might be useful for purposes of impeachment or
corroboration.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN12]A substantial need for work product materials
exists where the information sought is essential to the
party's defense, is crucial to the determination of whether
the defendant could be held liable for the acts alleged, or
carries great probative value on contested issues.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN13]The failure to list privileged documents on the
required log of withheld documents in a timely and
proper manner operates as a waiver of any applicable
privilege.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN14]A witness's availability for a deposition defeats a
claim of substantial need for work product material
because the party seeking discovery can ask the witness
himself about the events in issue, and, if the witness
recalls the events in issue, the need for notes or other
materials prepared by opposing counsel is, thereby,
eliminated. It is always the case that a witness may lie at
a deposition or may not have an accurate recollection.
However, if those facts, without more, were sufficient to
pierce a claim of work product, work-product protection,
at least with respect to witness statements, would quickly
become meaningless.
Civil Procedure > Discovery > Privileged Matters >
Work Product > General Overview
[HN15]The crime-fraud exception applies and pierces
work product protection where the attorney-client
communications in issue were in furtherance of a crime
or fraud.

Page 3

2002 U.S. Dist. LEXIS 20107, *1

COUNSEL: For AIA Holding SA, PLAINTIFF: Peter N
Wang, Todd C Norbitz, Friedman, Wang & Bleiberg, PC,
New York, NY USA.
For Lehman Brothers Inc, DEFENDANT: Robert W
Gaffey, Layton Brooks & Hecht, Robert W Gaffey,
Jones, Day, Reavis & Pogue, New York, NY USA.
For Bear Stearns & Co Inc, DEFENDANT: Howard M
Sendrovitz, Rosenman & Colin LLP, Stephen L Ratner,
Katten, Muchin, Zavis, Rosenman, Stephen L Ratner,
Howard Wilson, Proskauer Rose, LLP, New York, NY
USA.
JUDGES: HENRY PITMAN, United States Magistrate
Judge.
OPINION BY: HENRY PITMAN
OPINION

OPINION AND ORDER
PITMAN, United States Magistrate Judge:
I. Introduction
Two discovery applications are currently pending
before me. First, plaintiffs seek to compel production of
numerous documents listed on Bear Stearns & Co., Inc.'s
("Bear Stearns'") index of documents withheld on the
basis of privilege and work product on the ground that
[*2] Bear Stearns' index of withheld documents is
facially inadequate. In addition, plaintiffs seek to compel
production of numerous documents withheld by Bear
Stearns on the basis of work product, claiming that the
information in those documents is not available from any
other source and that plaintiffs have substantial need for
those documents.
Second, defendant Lehman Brothers, Inc.
("Lehman") seeks to compel non-party witnesses (a)
Pricewaterhouse Coopers United Kingdom, (b) the law
firm of Stillman & Friedman, P.C. and (c) the law firm of
Lovells P.C. to produce certain documents withheld on
the ground of work product.
For the reasons set forth below, both motions are
denied in all respects.

A. Background
The facts underlying this action have been set forth
in detail in several opinions by the Honorable Lawrence
M. McKenna, United States District Judge, addressing
various dispositive motions made by the parties. See
A.I.A. Holdings, S.A. v. Lehman Bros., Inc., 2002 U.S.
Dist. LEXIS 10848, 97 Civ. 4978 (LMM), 2002 WL
1334809 (S.D.N.Y. June 17, 2002); A.I.A. Holdings, S.A.
v. Lehman Bros., Inc., 2002 U.S. Dist. LEXIS 980, 97
Civ. 4978 (LMM), 2002 WL 88226 (S.D.N.Y. Jan. 23,
2002); [*3] A.I.A. Holdings, S.A. v. Lehman Bros., Inc.,
1998 U.S. Dist. LEXIS 4175, 97 Civ. 4978 (LMM), 1998
WL 159059 (S.D.N.Y. Apr. 1, 1998). Familiarity with
these opinions is assumed.
For present purposes, it is sufficient to note that this
action arises out of a massive alleged fraud perpetrated in
Lebanon by an individual named Ahmad Al-Daouk.
According to the complaint now before the Court,
plaintiffs are approximately 270 individuals and entities,
mostly from the Middle East, who gave money to Daouk
and entities controlled by him to invest in securities and
other investment vehicles. Daouk allegedly informed his
customers that their funds had been invested with the
defendant brokerage companies. Through various types
of chicanery, betrayal and deceit, Daouk allegedly
dissipated his victims' funds, misappropriated money for
himself and either misapplied or misappropriated any
profits that his investments were fortunate enough to
earn. Among other things, Daouk allegedly intercepted
account statements sent by defendants to the plaintiffs,
destroyed the originals and fabricated false statements to
show that plaintiffs' investments were doing far better
than they actually were. Plaintiffs have asserted [*4]
various theories of liability against defendants and have
offered some evidence that some of the defendants'
employees were active participants in the scheme and
shared in its alleged proceeds. The aggregate damages
claimed are in excess of $ 100 million.
B. Plaintiffs' Motion
Plaintiffs' motion arises out of an index of withheld
documents produced by Bear Stearns. The index lists 160
documents and provides for each (to the extent the
information is available) the date of the document, the
type of document, the author, the recipient, who received
copies, a description of the document and the nature of
the privilege being asserted.

II. Facts
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2002 U.S. Dist. LEXIS 20107, *4

Plaintiffs' motion consists of two parts. In the first
part of their motion, plaintiffs argue that Bear Stearns'
index does not set forth sufficient facts to support its
assertions of privilege and work product. Specifically,
plaintiffs divide almost all the documents on Bear
Stearns' index into three categories. As to the first
category ("Category A"), plaintiffs claim that Bear
Stearns has not provided sufficient facts to show that the
documents were prepared in anticipation of litigation and
has not, therefore, established the applicability of work
[*5] product protection. 1 As to the second category
("Category B"), plaintiffs claim that Bear Stearns has
failed to provide specific facts establishing that the
documents, which were prepared by non-lawyers, were
prepared at or under the direction of attorneys. 2
According to plaintiffs, this hole in the proof defeats the
assertion of work product protection as to these
documents. As to the third category ("Category C"),
plaintiffs claim that Bear Stearns has failed (1) to set
forth specific facts as to each document establishing that
it was prepared for the purpose of providing legal and not
business advice and (2) to set forth specific facts
establishing that the documents reflect confidential client
communications. 3
1
Since plaintiffs made their motion, Bear
Stearns has voluntarily produced some of the
documents challenged by plaintiffs. The
documents in Category A that remain in issue are
numbers 1, 2, 12, 24A, 33, 35, 37 42, 43, 70, 105,
123 and 124.
2 The documents in Category B that remain in
issue are documents 3, 11, 13, 16, 17, 18, 19,
24B, 25, 28, 30, 38, 39, 41, 44, 46, 47, 51, 54, 55,
56, 58, 61, 93, 94, 101, 102, 103, 110, 125, 126,
127 and 129.
[*6]
3 The documents in Category C that remain in
issue are documents 10, 14, 27, 95, 117, 132, 136,
138 and 151.
The second aspect of plaintiffs' motion seeks
production of numerous documents that are being
withheld on the basis of work product on the theory that
plaintiffs have demonstrated a substantial need for the
documents and that the information contained in those
documents is not available from any other source. 4
Plaintiffs argue that these documents are the only
alternative source for the information that was contained
in documents that were destroyed in a fire at Bear

Stearns' document storage facility.
4 The documents plaintiffs seek in this aspect of
their motion that remain in issue are documents 1,
2, 3, 10, 11, 12, 13, 16, 17, 18, 19, 24, 25, 28, 29,
30, 32, 33, 35, 37, 38, 39, 41, 42, 43, 44, 45, 46,
47, 51, 52, 53, 54, 55, 56, 57, 58, 60, 61, 62, 66,
69, 70, 93, 94, 100, 101, 102, 103, 104, 105, 110,
115, 123, 124, 125, 126, 127, 129, 130, 137 and
161.
[*7] C. Lehman's Motion
Lehman has also made an unrelated motion in which
it seeks to compel production from the non-party
witnesses of a transcript and tape recording of an
interview with Daouk conducted by the United Kingdom
liquidator of Mid East Trading Ltd., one of the entities
through which Daouk perpetrated his fraud. Defendants
had previously attempted to obtain the transcript of the
interview from plaintiff Marwan Hakim. However, in
May 2000, I sustained plaintiffs' work product objection
to producing the transcript, concluding that the transcript
was work product and that since Daouk was scheduled to
be deposed in July 2000, defendants could not, at that
time, show substantial need sufficient to justify piercing
the work-product protection.
III. Analysis
A. Plaintiffs' Motion
1. The Sufficiency of Bear Stearns' Index5
5
Plaintiffs have expressly disclaimed any
contention that their motion is addressed to the
merits of Bear Stearns' assertions of the
attorney-client or work-product privileges
(Plaintiffs' Reply Memorandum in Support of
Plaintiffs' Motion to Compel Production of
Documents, dated July 18, 2001 ("Plaintiffs'
Reply Mem."), at 2). Thus, the only issue to be
resolved concerning this aspect of plaintiffs'
motion is the facial sufficiency of Bear Stearns'
index.
[*8] The obligation to produce an index of withheld
documents in response to a Rule 34 request has two
sources in this District. First, [HN1]Fed.R.Civ.P. 26(b)(5)
provides:

Page 5

2002 U.S. Dist. LEXIS 20107, *8

When a party withholds information
otherwise discoverable under these rules
by claiming that it is privileged or subject
to protection as trial preparation material,
the party shall make the claim expressly
and shall describe the nature of the
documents, communications, or things not
produced or disclosed in a manner that,
without revealing information itself
privileged or protected, will enable other
parties to assess the applicability of the
privilege or protection.
Second, [HN2]Local Civil Rule 26.2 provides:
(a) Where a claim of privilege is asserted
in objecting to any means of discovery or
disclosure ... and an answer is not
provided on the basis of such assertion,
(1) the attorney asserting
the privilege shall identify
the nature of the privilege
(including work product)
which is being claimed and,
if the privilege is governed
by state law, indicate the
state's privilege rule being
invoked; and
(2)
the
following
information
shall
be
provided in the objection,
unless divulgence of such
information would [*9]
cause disclosure of the
allegedly
privileged
information:
(A) for documents: (i)
the type of document, e.g.,
letter or memorandum; (ii)
the general subject matter
of the document; (iii) the
date of the document; and
(iv) such other information
as is sufficient to identify
the document for a
subpoena duces tecum,
including,
where
appropriate, the author of

the
document,
the
addressees
of
the
document, and any other
recipients shown in the
document, and, where not
apparent, the relationship of
the author, addressees, and
recipients to each other ....

Plaintiff's motion seems to be predicated on a
fundamental misapprehension of the role played by an
index of withheld documents. Plaintiffs seem to be
claiming that, in response to a Rule 34 request and prior
to any motion to compel production, a party withholding
documents on the ground of privilege or work product
must produce an index, affidavits or other evidence
which, in the aggregate, for each document withheld,
establish every element of each privilege or protection
asserted and that the failure to do so results in a waiver of
the privilege or protection. The law is otherwise.
Unless and until a motion to compel is made [*10]
or an assertion of privilege is otherwise challenged before
the Court, the only obligation the Federal Rules and the
Local Rules impose on the withholding party is to
produce an index of documents that complies with the
requirements set forth above. The Advisory Committee
Notes to the 1993 Amendments to [HN3]the Federal
Rules of Civil Procedure explain that the Rule 26(b)(5)
was not intended to establish rigid requirements
concerning the information disclosed in an index of a
withheld documents:
The [withholding] party must ... provide
sufficient information to enable other
parties to evaluate the applicability of the
claimed privilege or protection. Although
the person from whom the discovery is
sought decides whether to claim a
privilege or protection, the court
ultimately decides whether, if this claim is
challenged, the privilege or protection
applies. Providing information pertinent to
the applicability of the privilege or
protection should reduce the need for in
camera examination of the documents.

Page 6

2002 U.S. Dist. LEXIS 20107, *10

The rule does not attempt to define for
each case what information must be
provided when a party asserts a claim of
privilege or work product protection.
Details concerning time, [*11] persons,
general subject matter etc., may be
appropriate if only a few items are
withheld, but may be unduly burdensome
when voluminous documents are claimed
to be privileged or protected ....

Similarly, this Court has noted that [HN4]the index
of withheld documents need not establish all the elements
of a privilege by itself.
Typically [privilege] logs will identify
each document and the individuals who
were parties to the communications,
providing sufficient detail to permit a
judgment as to whether the document is at
least potentially protected from disclosure.
Other required information, such as the
relationship between the individuals listed
in the log and the litigating parties, the
maintenance of confidentiality and the
reasons for any disclosures of the
document to individuals not normally
within the privileged relationship, is then
typically supplied by affidavit or
deposition testimony.
Bowne of New York City, Inc. v. AmBase Corp., 150
F.R.D. 465, 474 (S.D.N.Y. 1993); accord United States
v. Construction Prods. Research, Inc., 73 F.3d 464, 473
(2d Cir. 1996).
The central issue raised by plaintiffs' motion is what
does the [*12] proponent of a privilege have to prove
and at what stage does it need to prove it.
Plaintiffs base their argument on a quote from
Golden Trade S.r.L. v. Lee Apparel Co., 1992 U.S. Dist.
LEXIS 17739, 90 Civ. 6291 (JMC), 90 Civ. 6292 (JMC)
and 92 Civ. 1667 (JMC), 1992 WL 3676070 at *5
(S.D.N.Y. Nov. 20, 1992) , which states: "The standard
for testing the adequacy of the privilege log is whether, as
to each document, it sets forth specific facts that, if
credited, would suffice to establish each element of the
privilege or immunity that is claimed" (Plaintiffs'

Memorandum of Law in Support of Plaintiffs' Motion to
Compel Production of Documents, dated May 7, 2001
("Plaintiffs' Mem.") at 1). Plaintiffs claim that Bear
Stearns' failure to set forth specific facts as to each
element of each privilege as to each document prior to
plaintiffs' motion operates as a waiver of the privilege. If
plaintiffs are correct, virtually no index of withheld
documents served in this District would pass muster.
For example, [HN5]one element of the
attorney-client privilege is that the "attorney" must
actually be admitted to the bar of a state or federal court.
Bank Brussels Lambert v. Credit Lyonnais (Suisse) S.A.,
160 F.R.D. 437, 441 (S.D.N.Y. 1995), [*13] quoting
United States v. United Shoe Mach. Corp., 89 F. Supp.
357, 358-59 (D. Mass. 1950). Although, the privilege has
been extended to cover communications with an
attorney's subordinate, see United States Postal Serv. v.
Phelps Dodge Refining Co., 852 F. Supp. 156, 161
(E.D.N.Y. 1994), the privilege requires that there be a
communication intended to reach, either directly or
indirectly, an attorney admitted to practice. Thus, in the
absence of an excusable mistake of fact, even if all the
other requirements of the privilege are met,
communications between a "client" and an unadmitted
law school graduate are not privileged even where the
putative "attorney" has passed the bar examination.
Financial Technologies, Int'l. Inc. v. Smith, 2000 U.S.
Dist. LEXIS 18220, 99 Civ. 9351 (GEL)(RLE), 2000 WL
1855131 (S.D.N.Y. Dec. 19, 2000). [HN6]Nevertheless,
neither Fed.R.Civ.P. 26(b)(5) nor Local Civil Rule 26.2
require an allegation of specific facts establishing an
attorney's admission to the bar at the time of an allegedly
privileged communication. Thus, if plaintiffs are correct,
an index of withheld documents that was in full
compliance with both the Federal Rules of Civil [*14]
Procedure and the Local Civil Rules would invariably
result in a waiver of the privilege. Such a result cannot be
correct.
Moreover, the author of the "test" set forth in Golden
Trade S.r.L. v. Lee Apparel Co., supra, 1992 U.S. Dist.
LEXIS 17739, 1992 WL 3676070, has not applied it in
the manner suggested by plaintiffs. In Golden Trade, the
Honorable Michael H. Dolinger, United States Magistrate
Judge, expressly made his rulings concerning privilege on
the basis of plaintiff's privilege log, plaintiff's evidentiary
submission in response to the motion to compel and an in
camera review of the documents in issue. 1992 U.S. Dist.
LEXIS 17739, 1992 WL 3676070 at *1. Similarly, in
Page 7

2002 U.S. Dist. LEXIS 20107, *14

Bowne of New York City, Inc. v. AmBase Corp., supra,
150 F.R.D. 465, upon which plaintiffs also rely,
Magistrate Judge Dolinger noted that the ultimate
determination of the availability of a privilege was
ordinarily based on [HN7]"an adequately detailed
privilege log in conjunction with evidentiary submissions
to fill in any factual gaps." 150 F.R.D. at 474. 6

burden may be discharged where, as here,
the proponent has served a detailed index
of documents withheld, and the challenger
has submitted specific challenges. Apart
from the specific challenges made in its
motion, defendant does not generally
challenge the adequacy of plaintiff's index.

6
In addition, plaintiffs themselves have not
produced an index of withheld documents that
comports with the standards plaintiffs now seek to
posit. For example, plaintiffs claim here that, with
respect to documents prepared by non-legal
personnel, work-product protection is available
only if the documents were prepared "at or under
the direction of counsel" (Plaintiffs' Mem. at 14
(inner quotations omitted)), and that Bear Stearns'
failure to set forth specific facts as to each
document, prior to the present motion,
establishing such facts operates as a waiver of
work-product protection. Plaintiffs' index of
withheld documents asserts work-product
protection as to 61 of 62 withheld documents.
Although all of plaintiffs' withheld documents are
authored by plaintiffs themselves, plaintiffs' index
nowhere sets forth specific facts that the
documents were prepared at or under counsel's
direction. Admittedly, a failure by one party to a
litigation does not excuse an identical failure by
the other. However, where as here, a party seeks
to impose a discovery obligation that goes beyond
the plain text of the applicable rules, and the party
seeking to impose the obligation has not itself
complied with the standard it seeks to impose, I
cannot help but question the validity of the
argument.

Under these circumstances, it appears
that the proponent of the privilege may
satisfy its burden by submitting
evidentiary material as to the challenged
elements only. Requiring the proponent to
submit evidentiary material to prove all
elements of the privilege in response to a
specific challenge unduly burdens and
wastes the time of both the Court and the
parties. A party [*16] asserting a claim of
privilege is obligated to prepare an index
of withheld documents, which must
provide sufficient information "to assess
the applicability of the privilege or
protection." Fed.R.Civ.P. 26(b)(5). Thus, a
party challenging an assertion of privilege
is given the information necessary to state
the grounds of its challenge and is not left
to guess at the nature of what's being
withheld and why. Since the challenger is
given this information, there is no logic or
efficiency in requiring the proponent of a
privilege or the Court to address matters
which are not contested by the challenger.
See generally In re Grand Jury
Investigation, 974 F.2d 1068, 1071 (9th
Cir.1992); Bowne of New York City, Inc. v.
AmBase Corp., supra, 150 F.R.D. at 474;
Golden Trade, S.r.L. v. Lee Apparel Co.,
1992 U.S. Dist. LEXIS 17739, 90 Civ.
6291 (JMC), 1992 WL 367070 at *5
(S.D.N.Y. Nov. 20, 1992).

[*15] Although the law on the subject is not well
developed, I continue to believe that the appropriate
manner to adjudicate claims of privilege is the
mechanism I suggested in ECDC Environmental L.C. v.
New York Marine & Gen. Ins. Co., 1998 U.S. Dist.
LEXIS 8808, 96 Civ. 6033 (BSJ)(HBP), 1998 WL
614478 at *3-*4 (S.D.N.Y. June 4, 1998):
[HN8]Although it is clear that the
proponent of the privilege ultimately bears
the burden of proving all essential facts
necessary to sustain a claim of privilege,
the law is not entirely clear as to how this

Stated with slightly more detail, [HN9]the
withholding party's initial obligation is to prepare an
index of withheld documents providing the specific
information required by Fed.R.Civ.P. 26(b)(5) and Local
Civil Rule 26.2. If the assertions of privilege are not
challenged, the withholding [*17] party has no further
obligation with respect to its assertions of privilege If the
assertions of privilege are challenged and the dispute
Page 8

2002 U.S. Dist. LEXIS 20107, *17

cannot be resolved informally, the withholding party then
has to submit evidence, by way of affidavit, deposition
testimony or otherwise, establishing only the challenged
elements of the applicable privilege or protection, with
the ultimate burden of proof resting with the party
asserting the privilege or protection. See von Bulow v.
von Bulow, 811 F.2d 136, 144 (2d Cir. 1987), citing In re
Grand Jury Subpoena Dated Jan. 4, 1984, 750 F.2d 223,
224 (2d Cir. 1984); Bowne of New York City, Inc. v.
AmBase Corp., supra, 150 F.R.D. at 470 (S.D.N.Y. 1993)
(collecting cases).
The foregoing procedure properly allocates the
burden of proof and saves the Court and the parties from
having to address any elements of a privilege or
protection that are not in dispute. In addition, the
foregoing accurately reflects the manner in which
disputes concerning documents withheld on the ground of
privilege are currently resolved in this District. See, e.g.,
Johnson Matthey, Inc. v. Research Corp., 01 Civ. 8115
(MBM)(FM), 2002 U.S. Dist. LEXIS 18802, 2002 WL
31235717 at *3 (S.D.N.Y. Oct. 3, 2002) [*18]
[HN10]("Where the information in the log [of withheld
documents] is insufficient to establish a factual basis for
the privilege, the proponent of the privilege bears the
burden of showing its applicability, a gap which often is
filled through an affidavit or deposition testimony.");
CSC Recovery Corp. v. Daido Steel Co., 1997 U.S. Dist.
LEXIS 16346, 94 Civ. 9214 (LAP)(THK), 1997 WL
661122 at *2 (S.D.N.Y. Oct. 22, 1997) ("Daido's
privilege log, combined with Ms. Newton's affidavit,
providing greater detail about the authors and recipients
of the documents and the context in which they were
generated, and the documents themselves, which have
been submitted for review, are more than sufficient to
support the asserted claims of privilege."). See generally
U.S. Info. Sys. v. IBEW Local Union No. 3, 2002 U.S.
Dist. LEXIS 17532, 00 Civ. 4763 (MBM)(JCF), 2002
WL 31093619 at *1 (S.D.N.Y. Sept. 17, 2002) (Privilege
log that provides information required by Local Civil
Rule 26.2(a) is facially sufficient.).
Since Bear Stearns has submitted affidavits in
opposition to the current motion that fill in the "gaps"
asserted by plaintiffs, [*19] it has sustained its burden of
proof with respect to the documents challenged by
plaintiffs.
Finally, although I have previously quoted and relied
upon the passage from Golden Trade, S.r.L. v. Lee

Apparel Co., supra, 1992 U.S. Dist. LEXIS 17739, 1992
WL 367070, on which plaintiffs rely, in resolving a prior
discovery dispute in this matter, A.I.A. Holdings, S.A. v.
Lehman Bros., Inc., 2000 U.S. Dist. LEXIS 15141, 97
Civ. 4978 (LMM)(HBP), 2000 WL 1538003 at *2
(S.D.N.Y. Oct. 17, 2000) ("October 2000 Decision"), I do
not believe there is any inconsistency between the result
here and the result in my October 2000 Decision. My
October 2000 Decision arose out of Bear Stearns' attempt
to withhold a tape recording of a conversation; Bear
Stearns' index entry for the conversation did not identify
the parties to the conversation, did not identify the subject
matter and justified the assertion of work-product
protection by merely parroting the definition of the
work-product doctrine. See 2000 U.S. Dist. LEXIS
15141, 2000 WL 1538003 at *3. Thus, I concluded that
Bear Stearns' failure to describe the tape recording in
conformity with Fed.R.Civ.P. 26(b)(5) and Local Civil
Rule 26.2(a) operated as a waiver of any claim of work
product [*20] protection. Although I did cite and quote
Golden Trade in my October 2000 Decision for the
proposition that an index of withheld documents "must
'as to each document, ... set [] forth specific facts that, if
credited, would suffice to establish each element of the
privilege or immunity that is claimed,'" 2000 U.S. Dist.
LEXIS 15141, 2000 WL 1538003 at *2, there was no
claim in that dispute that Bear Stearns had waived
work-product protection by failing to set forth specific
facts establishing each element of each privilege asserted.
Rather the issue in my October 2000 Decision was Bear
Stearns' gross failure to comply with Fed.R.Civ.P.
26(b)(5) and Local Civil Rule 26.2(a), and it was that
gross failure that lead to the finding of waiver.
Accordingly, plaintiffs' motion to compel the
production of documents withheld by Bear Stearns on the
ground that Bear Stearns' index of withheld documents is
facially deficient is denied. 7
7 In addition to challenging plaintiffs' motion on
the merits, Bear Stearns also contends that the
motion is untimely. Since I conclude that
plaintiffs' motion should be denied on the merits, I
do not address Bear Stearns' arguments
concerning the timeliness of the plaintiffs' motion.
[*21] 2. Plaintiffs' "Substantial Need" for Documents
Withheld on the Basis of Work Product
Plaintiffs next contend that, even if Bear Stearns'
assertions of work product are facially valid, a substantial
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2002 U.S. Dist. LEXIS 20107, *21

number of the documents withheld on the basis of work
product should be produced because plaintiffs have a
substantial need for the information in those documents
and are unable to obtain that information through any
alternative source. Specifically, plaintiffs claim that the
withheld documents disclose trading activity in plaintiffs'
accounts and that all other records disclosing that
information were destroyed in a fire at Bear Stearns'
document storage facility.
[HN11]Where the applicability of the work product
doctrine has been established, factual material may,
nevertheless, be ordered produced "upon a showing of
substantial need and inability to obtain the equivalent
without undue hardship." Upjohn Co. v. United States,
449 U.S. 383, 400, 66 L. Ed. 2d 584, 101 S. Ct. 677
(1981). The Supreme Court has described the "substantial
need" requirement as follows:
Where relevant and non-privileged facts
remain hidden in an attorney's file and
where production of [*22] those facts is
essential to the preparation of one's case,
discovery may properly be had. Such
written statements and documents might,
under certain circumstances, be admissible
in evidence or give clues as to the
existence or location of relevant facts. Or
they might be useful for purposes of
impeachment or corroboration."
Hickman v. Taylor, 329 U.S. 495, 511, 91 L. Ed. 451, 67
S. Ct. 385, 34 Ohio Op. 395 (1947) (emphasis added);
accord In re Grand Jury Proceedings, 2001 U.S. Dist.
LEXIS 15646, No. M-11-189, 2001 WL 1167497 at *21
(S.D.N.Y. Oct. 3, 2001). See also Madanes v. Madanes,
199 F.R.D. 135, 150 (S.D.N.Y. 2001) ("Substantial need
is shown where the work product material at issue is
central to the substantive claims in litigation."); National
Congress for Puerto Rican Rights v. City of New York,
194 F.R.D. 105, 110 (S.D.N.Y. 2000) [HN12]("A
substantial need for work product materials exists where
the information sought is 'essential' to the party's defense,
is 'crucial' to the determination of whether the defendant
could be held liable for the acts alleged, or carries great
probative value on contested issues." (citations and
footnotes omitted)).
[*23] The principal problem with plaintiffs'
argument here is that they have offered no evidence

whatsoever establishing that the information is not
available to them from other sources. In contrast, Bear
Stearns has offered the affidavit of Thomas S. Cohen
which states that all the factual information in the
withheld documents is either contained in other
documents produced to plaintiffs or was produced by
plaintiffs themselves. Given this uncontradicted evidence,
it is impossible to conclude that plaintiffs have met their
burden of demonstrating a substantial need for the
withheld documents. 8
8 Indeed, in connection with Lehman's motion to
compel, discussed in Section III(B), plaintiffs note
that "It is hornbook law that a party seeking to
obtain discovery of work product material bears a
heavy burden of proof to justify disclosure"
(Letter of Todd C. Norbitz, Esq., dated September
25, 2002 at 6 (emphasis added)).
Accordingly, plaintiffs' application to compel the
production of documents withheld by Bear [*24] Stearns
on the basis of work product on the ground that plaintiffs
have demonstrated a substantial need for the documents
is also denied.
B. Lehman's Motion to Compel
Lehman makes two arguments in support of its
application to compel production of the Daouk interview
tape and transcript. First, it claims that any privilege with
respect to the tape has been waived by the failure of the
non-party witnesses to identify the tape on their schedule
of documents withheld on the ground of privilege.
Second, Lehman claims that it has a substantial need for
the tape and transcript because it believes them to contain
impeachment material that is not available elsewhere.
Although I have repeatedly held, and continue to
believe, that [HN13]the failure to list privileged
documents on the required log of withheld documents in
a timely and proper manner operates as a waiver of any
applicable privilege, see, e.g., Bruker v. City of New
York, 2002 U.S. Dist. LEXIS 5334, 93 Civ. 3848
(MGC)(HBP), 2002 WL 484843 at *5 (S.D.N.Y. Mar.
29, 2002); A.I.A. Holdings, S.A. v. Lehman Bros., Inc.,
2000 U.S. Dist. LEXIS 15141, 97 Civ. 4978
(LMM)(HBP), 2000 WL 1538003 at *3 (S.D.N.Y. Oct.
17, 2000); PKFinans Int'l Corp. v. IBJ Schroder Leasing
Corp. Leasing Corp., 1996 U.S. Dist. LEXIS 13505, 93
Civ. 5375 (SAS)(HBP), 1996 WL 525862 at *3-*4
(S.D.N.Y. Sept. 17, 1996), [*25] the present case is
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2002 U.S. Dist. LEXIS 20107, *25

distinguishable from situations in which a party fails to
list a document entirely or fails to provide, in sufficient
detail, the information required by Fed.R.Civ.P. 26(b)(5)
or Local Civil Rule 26.2(a). In this case, there is no
dispute that the non-party witnesses timely and
adequately indexed the transcript of the interview; it is
only the tape recording that was not timely listed.
Although the analogy is, admittedly, imperfect, the
situation here approaches a party's failure to index a
non-identical copy of an indexed document that contains
only immaterial variations. The magnitude of the
non-party witnesses' default here is not equivalent to
either a complete failure to list a document or a failure to
provide all the information required by the applicable
rules. Under the circumstances of this case, I conclude
that a finding of waiver is disproportionate to the default
and, therefore, reject Lehman's first argument.
The non-party witnesses' principal argument in
opposition to Lehman's "substantial need" argument is
that Lehman had the opportunity to depose [*26] Daouk
and to ask him about the interview memorialized in the
tape and transcript in issue. Since Lehman had the
opportunity to interrogate Daouk about the interview in
issue, the non-party witnesses claim that Lehman cannot
establish a substantial need for the documents. See
Tribune Co. v. Purcigliotti, 1998 U.S. Dist. LEXIS 5155,
93 Civ. 7222 (LAP), 1998 WL 175933 at *4 (S.D.N.Y.
Apr. 14, 1998) ("'Substantial need' cannot be shown
where persons with equivalent information are available
for deposition."), citing Horn & Hardart Co. v. Pillsbury
Co., 888 F.2d 8, 12 (2d Cir. 1989). See also Gay v. P.K.
Lindsay Co., 666 F.2d 710, 713 (1st Cir. 1981) ("It seems
well-settled that there is in general no justification for
discovery of the statement of a person contained in work
product materials when the person is available to be
deposed."); Taylor v. Costa Cruises, Inc., 1992 U.S. Dist.
LEXIS 11435, 90 Civ. 2630 (KC), 1992 WL 196793 at
*1 (S.D.N.Y. Aug. 13, 1992); 8 Charles A. Wright,
Arthur R. Miller & Richard L. Marcus, Federal Practice
& Procedure § 2025 at 375 (2d ed. 1994) ("Discovery of
work product material will be denied if the party seeking
discovery can obtain [*27] the desired information by
taking the deposition of witnesses."). The non-party
witnesses also argue that a substantial need for work
product material can never be established where the
material in issue is relevant for impeachment purposes
only.
There can be no dispute here that Daouk did appear

for a proceeding in the nature of a deposition in July 2000
in Casablanca during which he made himself available
for questioning for five days. During the proceeding,
Lehman never asked Daouk about the interview
conducted by Mid East's liquidator. Nevertheless, without
citing any authority, Lehman claims that Daouk's
availability for questioning is "not ... pertinent" to the
claim of work product and that the only pertinent issue is
the fact that the non-party witnesses are in possession of
unique impeachment material (Letter of Robert W.
Gaffey, Esq., dated Sept. 27, 2002, at 3).
Lehman's argument is not convincing. [HN14]A
witness's availability for a deposition defeats a claim of
substantial need for work product material because the
party seeking discovery can ask the witness himself about
the events in issue, and, if the witness recalls the events
in issue, the need for notes or other materials [*28]
prepared by opposing counsel is, thereby, eliminated. It is
always the case that a witness may lie at a deposition or
may not have an accurate recollection. However, if those
facts, without more, were sufficient to pierce a claim of
work product, work-product protection, at least with
respect to witness statements, would quickly become
meaningless.
Lehman's claimed inability to obtain the substantial
equivalent of the tape and transcript through other means
is also unconvincing. Assuming, without deciding that
impeachment material can, in some circumstances,
support a claim of substantial need sufficient to pierce a
claim of work product, 9 the wealth of impeachment
material already in this case with respect to Daouk
attenuates any need for the tape and transcript in issue.
Put bluntly, when he was questioned, Daouk freely
admitted that he ran a con game for several years for his
personal aggrandizement at the expense of his friends and
business associates. He admitted to repeatedly and
systematically forging documents to perpetrate his
scheme. Daouk admitted to carrying on his business
through an ongoing pattern of lies and deception in order
to secure a comfortable life for himself. [*29] Although
he now claims that certain individuals employed by
defendants either knew of or participated in his scheme,
Daouk authenticated documents in which he denied
virtually all the material allegations in plaintiffs'
complaint and claimed that they were fabrications,
including plaintiff's claim that defendants were aware of
his frauds. After his scheme to light, Daouk admitted to
participating in a second scheme in which he offered to
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2002 U.S. Dist. LEXIS 20107, *29

perjure himself in whatever fashion was most useful to
the highest bidder. Finally, there is also some evidence
suggesting that Daouk fabricated documents to
"corroborate" his claim of alleged payoffs to some of
defendants' employees. Given this evidence and array of
admissions by Daouk of his willingness to do virtually
anything for money, it is impossible to conclude that the
tape and transcript in issue, even if they contradicted
Daouk's testimony, would have substantial incremental
effect on the jury's assessment of Daouk's credibility.
9 The Supreme Court has indicated in dicta that
impeachment
material
may,
in
some
circumstances, be sufficient to support a claim of
substantial need. Hickman v. Taylor, supra, 329
U.S. at 511.
[*30] Accordingly, I also conclude that even if
Lehman had established a substantial need for the tape
and transcript in issue, the impeachment material to
which Daouk has already admitted is the substantial
equivalent of any impeachment information that could be
contained in the tape and transcript and that there is,
therefore, no basis to pierce the non-party witnesses'
claim of work product. 10

crime-fraud exception applies here and pierces
work product protection. However, Lehman offers
no evidence that the communications in issue
were in furtherance of a crime or fraud, and,
therefore, has not established a requisite element
of the exception. See United States v. Jacobs, 117
F.3d 82, 87 (2d Cir. 1997).
IV. Conclusion
Accordingly, for all the foregoing reasons, plaintiff's
motion to compel defendants to produce certain
documents withheld on the ground of the attorney-client
privilege and work product protection and Lehman's
motion to compel certain non-party [*31] witnesses to
produce a tape recording and transcript of an interview
with Daouk are denied in all respects.
Dated: New York, New York
October 18, 2002
SO ORDERED
HENRY PITMAN
United States Magistrate Judge

10

Lehman also claims that [HN15]the

Page 12