Firefighters' Retirement System et al v. Citco Group Limited et al

Filing 525

NOTICE AND ORDER Regarding In Camera Review Citco Defendants produce the documents corresponding to log entry numbers 211, 212, and 213 to Plaintiffs within seven (7) days of this Notice and Order due by 1/31/2018. Citco Defendants produce redacted v ersions of the documents corresponding to log entry numbers 945, 946, 950, 964, and 1837 as set forth above to Plaintiffs within seven (7) days of this Notice and Order; Citco Defendants unredact the previously redacted portion of the document corres ponding to log entry number 2109 and produce the entire document corresponding to log entry number 2109 to Plaintiffs within seven (7) days of this Notice and Order due by 1/31/2018. Signed by Magistrate Judge Erin Wilder-Doomes on 01/24/2018. (ELW)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF LOUISIANA
FIREFIGHTERS’ RETIREMENT
SYSTEM, ET AL.
CIVIL ACTION
VERSUS
13-373-SDD-EWD
CITCO GROUP LIMITED, ET AL.
NOTICE AND ORDER REGARDING IN CAMERA REVIEW
On January 5, 2018, the undersigned ordered defendants, Citco Technology Management,
Inc. (“CTM”), Citco Banking Corporation N.V. (“Citco Banking”), Citco Fund Services (Cayman
Islands) Limited (“CFS Cayman”), and The Citco Group Limited (“Citco Group”) (collectively,
the “Citco Defendants”) to submit twenty-one entries included on their privilege log for in camera
review.1 On January 9, 2018, the Citco Defendants submitted the documents as ordered and the
undersigned has reviewed the documents to determine whether the withheld information is
protected by the attorney-client privilege. As set forth herein, the undersigned ORDERS that the
Citco Defendants shall produce documents corresponding to log entry numbers 211, 212, 213, and
2109 in their entirety and the documents corresponding to log entry numbers 945, 946, 950, 964,
and 1837 in redacted form as set forth below to Plaintiffs within seven (7) days of this Notice and
Order.
I.

Background
Plaintiffs, Firefighters’ Retirement System (“FRS”), Municipal Employees’ Retirement

System of Louisiana (“MERS”), and New Orleans Firefighters’ Pension & Relief Fund (“NOFF”)
(collectively, “Plaintiffs”) filed a Motion to Continue Submission Date on Motion to Compel

See, R. Doc. 513. The log entries required to be submitted were identified on the Citco Defendants’ privilege log as
log entry numbers 2079, 1548, 1621, 211, 213, 212, 2109, 516, 513, 1837, 2261, 948, 938, 945, 949, 950, 951, 953,
964, 946, & 947.
1

1

Privileged Documents or Alternative Motion to Compel Privileged Documents (the “Motion to
Compel”) on November 16, 2017.2 Therein, Plaintiffs requested, inter alia, that the undersigned
proceed with an in camera review of certain documents entered on the Citco Defendants’ privilege
log. In support of their Motion to Compel, Plaintiffs compiled four primary exhibits reflecting log
entries which Plaintiffs argued were insufficient. The first of these exhibits, referred to by
Plaintiffs as “Exhibit 1,” logged documents received by in-house counsel (either sent to in-house
counsel or on which in-house counsel was copied).
On December 20, 2017, the undersigned ordered the Citco Defendants to submit a revised
Exhibit 1 that distinguished between documents which were sent “to” in house counsel or instead
on which in-house counsel was “carbon copied.”3 On December 28, 2017, the Citco Defendants
submitted a revised “Exhibit 1” identifying in-house counsel.4 As revised, the majority of the
entries included on Exhibit 1 were sent directly to in-house counsel (with additional in-house
counsel sometimes carbon copied). However, the undersigned identified twenty-one (21) entries
for which in-house counsel appear only in the “CC” field. 5 Six of these entries were produced in
redacted form.6 Fifteen of these entries have been withheld completely.7 The undersigned
questioned why some of these entries were produced in redacted form while some were not.
Further, while the description for each of these entries is detailed, it was unclear whether these
communications were actually confidential communications to a lawyer when the lawyer in

2

R. Doc. 481.

3

R. Doc. 508.

4

R. Doc. 510, Exhibit 1.

5

See, R. Doc. 510, Exhibit 1, Log Entry Numbers 2079, 1548, 1621, 211, 213, 212, 2109, 516, 513, 1837, 2261, 948,
938, 945, 949, 950, 951, 953, 964, 946, & 947.
6

See, R. Doc. 510, Exhibit 1, Log Entry Numbers 2079, 1548, 2109, 516, 513, & 2261.

7

See, R. Doc. 510, Exhibit 1, Log Entry Numbers 1621, 211, 213, 212, 1837, 948, 938, 945, 949, 950, 951, 953, 964,
946, & 947.

2

question only appears in the “CC” field. Accordingly, for these twenty-one (21) entries,8 the
undersigned ordered the Citco Defendants to submit the corresponding documents to the
undersigned for an in camera review.9
On January 9, 2018, the Citco Defendants delivered a sealed envelope to the clerk’s office
containing the twenty-one requested documents. The court has subsequently filed the Citco
Defendants’ cover letter thereto into the record with any information quoted directly from the
documents redacted by the court. Additionally, the undersigned has ordered the Citco Defendants
to maintain the documents reviewed by this court in camera in the form they were presented to the
court for purposes of any future appeal. Following review of the twenty-one documents, the
undersigned finds as follows.
II.

Law and Analysis
a. Legal Standard
Rule 501 of the Federal Rules of Evidence requires a federal court sitting in diversity to

apply the appropriate state’s law concerning the scope and application of the claimed attorneyclient privilege. The Louisiana Code of Evidence states:
A client has a privilege to refuse to disclose, and to prevent another
person from disclosing, a confidential communication ... made for
the purpose of facilitating the rendition of professional legal services
to the client, as well as the perceptions, observations, and the like,
of the mental, emotional, or physical condition of the client in
connection with such a communication....
La. Code Evid. art. 506(B). Under Louisiana law, the party asserting the privilege has the burden
of proving its applicability. Smith v. Kavanaugh, Pierson & Talley, 513 So.2d 1138, 1143 (La.

8

R. Doc. 510, Exhibit 1, Log Entry Numbers 2079, 1548, 1621, 211, 213, 212, 2109, 516, 513, 1837, 2261, 948, 938,
945, 949, 950, 951, 953, 964, 946, & 947.
9

R. Doc. 513. See, e.g., Varughese v. Mount Sinai Medical Center, 12 Civ. 8812, 2014 WL 349698, at * 2 (S.D.N.Y.
Jan. 31, 2014) (determining in camera review of documents where in house counsel was cc’d was appropriate).

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Sept. 9, 1987). The Fifth Circuit has explained that “[f]or a communication to be protected under
the privilege, the proponent ‘must prove: (1) that he made a confidential communication; (2) to a
lawyer or his subordinate; (3) for the primary purpose of securing either a legal opinion or legal
services, or assistance in some legal proceeding.’” Equal Employment Opportunity Commission
v. BDO USA, LLP, 2017 WL 5494237, at * 3 (5th Cir. Nov. 16, 2017) (citing United States v.
Robinson, 121 F.3d 971, 974 (5th Cir. 1997)).10 The party claiming the privilege bears the burden
of proof, and this is a highly fact-specific inquiry. Id. Ambiguities with respect to whether the
elements of a privilege claim have been met are construed against the proponent of the privilege.
Id.
“There is no presumption that a company’s communications with counsel are privileged.”
Id. * 4. “‘[C]ommunications by a corporation with its attorney, who at the time is acting solely in
his capacity as a business advisor, [are not] privileged,’…nor are documents sent from one
corporate officer to another merely because a copy is also sent to counsel…” Id. at * 4 (internal
citations omitted). “[A] privilege log’s description of each document and its contents must provide
sufficient information to permit courts and other parties to ‘test[ ] the merits of’ the privilege claim”
and “courts have stated that simply describing a lawyer’s advice as ‘legal,’ without more, is
conclusory and insufficient to carry out the proponent’s burden of establishing attorney-client
privilege.” Id. (internal citations omitted). See also, Chemtech Royalty Associates, L.P. v. United
States, Civil Action No. 05-944, 2010 WL 11538363, at * 7 (M.D. La. Sept. 23, 2010) (explaining

As set forth above, Louisiana law must govern the court’s determination regarding the applicability of the attorney
client privilege. However, this court has explained that federal law is instructive, “given the ‘federal common law
and Louisiana statutory law are materially similar concerning the attorney-client privilege.’” Forever Green Athletic
Fields, Inc. v. Babcock Law Firm, LLC, Civil Action No. 11-633, 2014 WL 29451, at * 6, n. 7 (M.D. La. Jan. 3, 2014)
(citing Akins v. Worley Catastrophe Response, LLC, No. 12–2401, 2013 WL 796095, at *11 (E.D. La. March 4, 2013);
Soriano v. Treasure Chest Casino, Inc., No. 95–3945, 1996 WL 736962, at *2 (E.D. La. Dec. 23, 1996) (federal
“common law and Louisiana statutory law are materially similar in this case in regards to attorney-client privilege”)).
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that when in-house counsel have responsibilities extending beyond rendering legal advice, “courts
require a clear showing that the attorney was acting in his professional legal capacity” but that
when “non-legal services such as…business advice that must be given along with legal advice in
order for the legal advice to be understood by a client, are mixed with legal services, it does not
render the legal services any less protected by the privilege. In fact, they are both protected when
they are inextricably intertwined.”). Attorney client privilege does not extend to materials
assembled in the ordinary course of business, or which provide purely factual data. See, U.S. v.
Louisiana, Civil Action No. 11-470, 2015 WL 4619561, at * 5 (M.D. La. July 31, 2015).
b. Documents 211, 212, and 213 Should Be Produced; Additional Portions of
Documents 945, 946, 950, 964, 1837 and 2109 Should be Produced11
Documents corresponding to log entry numbers 211, 212, and 213 are each part of an email
chain in which Mr. Ermanno Unternaehrer, an employee of a non-defendant Citco entity, writes to
Christopher Smeets, Robert Voges, Hans de Langen (each employees of Citco Group Limited),
and Larry Luckmann (an employee of Citco Banking Corporation and Citco Group Monaco)
regarding a dispute with Fletcher Asset Management (“FAM”) and the terms of an agreement to
sell Richcourt Paris. Mr. Unternaehrer’s email sets forth a summary of a call with representatives
of FAM. Mr. Unternaehrer states that he and Mr. Braham, an in-house lawyer for Citco Group
Limited, participated in the call. Mr. Unternaehrer’s summary appears to set forth his thoughts,
does not include any confidential communications (it instead sets out what happened and what was
said during the call with FAM), and does not appear to include Mr. Braham’s legal advice or
opinion. As such, the undersigned finds that the documents corresponding to log entry numbers

Concurrent with their January 9, 2018 submission, the Citco Defendants advised that “on further review,” the Citco
Defendants determined that document number 1621 “was inadvertently withheld.” The Citco Defendants aver that
this document has been now produced to Plaintiffs. Accordingly, no in camera review of document number 1621 is
necessary.
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5

211, 212, and 213 are not privileged and ORDERS these documents to be produced to Plaintiffs
within seven (7) days of this Notice and Order.
Documents corresponding to log entry numbers 938, 945, 946, 947, 948, 949, 950, 951,
953, and 964 are each part of the same email chain. Per their January 9, 2018 cover letter, the
Citco Defendants explain that they have previously produced the earlier portions of these email
chains reflecting communications between representatives of FAM and Citco.12 With respect to
the top portions of these documents, the communications reflect requests for legal services to be
performed by Maureen Gleeson, who the Citco Defendants have clarified is an in-house attorney.13
Specifically, these communications are between Ms. Gleeson and Wiekert Weber, an employee of
CFS Cayman, requesting Ms. Gleeson prepare documents related to the termination of services for
the Fletcher Funds. Because these communications were for the primary purpose of obtaining
legal services, they were properly redacted/withheld. However, with respect to log entry numbers
945, 946, 950, and 964, the most recent email in each document is not for the primary purpose of
obtaining legal services. Specifically, in the document corresponding to log entry 945, the May 5,
2010 2:55 pm email to Wiekert Weber from Maureen Gleeson, should not have been withheld. In
the document corresponding to log entry 946, both the May 5, 2010 9:55 am email from Maureen
Gleeson to Wiekert Weber and the 2:57 pm email from Wiekert Weber to Maureen Gleeson should
not have been withheld. In the document corresponding to log entry number 950, the 3:38 pm
email from Wiekert Weber to Maureen Gleeson and Alex Brainis should not have been withheld.
Finally, in the document corresponding to log entry 964, the 8:48 pm email from Wiekert Weber

The Citco Defendants state that “[t]he e-mail exchange between Wiekert Weber, Denis Kiely, and Stuart Turner at
the very bottom of this e-mail chain is not privileged and has already been produced to Plaintiffs.”
12

13

The Citco Defendants previously listed Ms. Gleeson as a non-lawyer employee of Citco Fund Services (Ireland).
R. Doc. 510, Exhibit 2.

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to Maureen Gleeson and Alex Brainis should not have been withheld.

These specific

communications generally reflect pleasantries rather than communications for purposes of seeking
or obtaining legal advice. Accordingly, for the documents corresponding to log entry numbers
945, 946, 950, and 964, Defendants are ORDERED to unredact and produce the specific emails
noted herein and to produce the revised redacted documents corresponding to log entry numbers
945, 946, 950, and 964 within seven (7) days of this Notice and Order. With the exception of the
specific email correspondence noted herein as contained in the documents corresponding to log
entry numbers 945, 946, 950, and 964, the undersigned finds that the previous production
(including the other redactions not addressed in this Ruling and Order) of documents
corresponding to log entry numbers 938, 945, 946, 947, 948, 949, 950, 951, 953, and 964 was
proper.
The document corresponding to log entry number 1837 consists of a string of emails
reflecting substantive discussions with Linklaters attorneys regarding a draft deed of amendment
to the original purchase share agreement for Richcourt. However, the very top portion of this
email string is a 5:27 p.m. request to Yves Bloch (an employee of Citco (Monaco) and Richcourt
(Monaco)) from Mr. Unternaehrer simply asking that changes to the document be forwarded to
Linklaters. Because this very top communication does not seek to secure either a legal opinion or
services, or assistance in a legal proceeding, the undersigned ORDERS that this portion only
should be produced. The remainder of the document corresponding to log entry number 1837 was
properly withheld and should be redacted. The Citco Defendants are ORDERED to produce the
as-redacted document corresponding to log entry number 1837 within seven (7) days of this Notice
and Order.

7

Per the Citco Defendants’ January 9, 2018 cover letter, the document corresponding to log
entry 2109 “is an e-mail chain that was produced in full, except for the redaction of a two-line email sent by Anthony Murray, an in-house lawyer at Citco Fund Services, in which Mr. Murray
responds to a request by John Verhooren14 in the prior e-mail for legal advice regarding the
suspension of the NAV by the Richcourt Funds.” However, in the redacted portion of the email
chain, Mr. Murray only reports what Richcourt is doing regarding the suspension of the official
NAV while stills sending out an estimated NAV. This appears to be factual information that would
not be privileged. Accordingly, the undersigned ORDERS that the previously redacted portion of
the document corresponding to log entry number 2109 be unredacted and that the entire document
be produced to Plaintiffs within seven (7) days of this Notice and Order.
c. Documents 513, 516, 938, 947, 948, 949, 951, 953, 1548, 2079 and 2261, or
Portions Thereof, Were Properly Withheld15
Documents corresponding to log entry numbers 513 and 516 are each part of the same
email chain. Per the Citco Defendants’ January 9, 2018 cover letter, the Citco Defendants have
produced the “top portions” of these email chains to Plaintiffs,16 and have withheld as privileged
portions of the email chain reflecting communications between in-house counsel regarding legal
work on CFS Cayman’s administration agreement with the Fletcher Funds. Although the redacted
portions of the email chain are not particularly substantive, the communications do appear to be
for the primary purpose of providing legal services and therefore the undersigned finds the portions

14

Mr. Verhooren is listed as an employee of Citco Fund Services (USA) and Citco Fund Services (Curacao). R. Doc.
510, Exhibit 2.
15

As discussed above, with the exception of specific emails contained in the email strings corresponding to the
documents logged as entry numbers 945, 946, 950, and 964, the undersigned finds that the documents corresponding
to log entry numbers 938, 945, 947, 948, 949, 950, 952, 953, and 964 were properly redacted and produced.
The Citco Defendants state that “[t]he top two e-mails of Document 513 and the top e-mail of Document 516 respond
to a request for a summary of the fee arrangements with the Fletcher Funds, which is provided in the attachment to
the e-mail chain (both of which have already been produced). Those top e-mails are not being withheld as privileged
and are being produced to Plaintiffs today.”
16

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of the documents corresponding to log entry numbers 513 and 516 were properly
redacted/withheld.
The document corresponding to log entry number 1548 is an email string between an
attorney of Linklaters17 and in-house counsel and employees of Citco. In their January 9, 2018
cover letter, the Citco Defendants state that portions of this email string are not privileged and aver
that those portions have been now produced to Plaintiffs.18 The remaining portions of the
document corresponding to log entry number 1548 are communications from or to Helio Banck
(in-house counsel for Citco Group Limited) and/or counsel for Linklaters19 regarding legal and tax
issues related to the Richcourt transaction and reflect primarily the provision of legal services.
Accordingly, this document was properly redacted.
The document corresponding to log entry number 2079 is an email chain which the Citco
Defendants assert has been “produced in full, except for the redaction of a two-line e-mail sent by
David Makin, an in-house lawyer with CFS Cayman, to others at CFS Cayman which contains
legal advice regarding the Leveraged Offering Memorandum.”20 The redacted portion of the email
chain reflects Mr. Makin’s opinion regarding what, if anything is outstanding for the setup of
Series N. The undersigned finds the redacted portion primarily provides legal opinion, and
therefore was properly redacted.

Per the Citco Defendants January 9, 2018 cover letter, Linklaters “represented The Citco Group and Citco Trading,
Inc. in the Richcourt transaction.”
17

“The last three e-mails…reflect a request by Yves Bloch and Helio Banck to Michele Mauran for a copy of the
shareholders register of Richcourt Fund Advisors SAS (which has been produced as an attachment to the e-mail).
That part of the e-mail chain is not privileged and those e-mails are being produced to Plaintiffs today.”
18

Employees of UBS are also include on the email chain. The Citco Defendants aver that UBS “was Citco’s agent
and financial advisor with respect to the Richcourt transaction and is therefore within the scope of the privilege.” On
January 1, 2018, the Citco Defendants were ordered to provide Plaintiffs with a supplemental log as well as any legal
authority or evidence establishing that inclusion of, inter alia, employees of UBS on privileged communications did
not affect the existence of the attorney client privilege. See, R. Doc. 513.
19

20

January 9, 2018 cover letter.

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Finally, the document corresponding to log entry number 2261 is an email chain which the
Citco Defendants assert has been “produced in full, except for the redaction of a request for legal
advice by Albert van Nijen to the legal department of the Citco Fund Services.”21 Although not
particularly substantive, the redacted portion of this email chain reflects a request for CFS legal to
draft certain documents. Accordingly, the undersigned finds that this portion of the document was
properly redacted.
III.

Conclusion
For the reasons set forth herein,
IT IS HEREBY ORDERED that the Citco Defendants produce the documents

corresponding to log entry numbers 211, 212, and 213 to Plaintiffs within seven (7) days of this
Notice and Order.
IT IS FURTHER ORDERED that the Citco Defendants produce redacted versions of the
documents corresponding to log entry numbers 945, 946, 950, 964, and 1837 as set forth above to
Plaintiffs within seven (7) days of this Notice and Order.
IT IS FURTHER ORDERED that the Citco Defendants unredact the previously redacted
portion of the document corresponding to log entry number 2109 and produce the entire document
corresponding to log entry number 2109 to Plaintiffs within seven (7) days of this Notice and
Order.
Signed in Baton Rouge, Louisiana, on January 24, 2018.

S
ERIN WILDER-DOOMES
UNITED STATES MAGISTRATE JUDGE

21

January 9, 2018 cover letter.

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