D'ONOFRIO v. BOROUGH OF SEASIDE PARK et al

Filing 251

OPINION filed. Signed by Judge Anne E. Thompson on 12/19/2012. (eaj)

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

Stephen D’ONOFRIO,
Plaintiff,

Civ. No. 09-06220

v.

OPINION

BOROUGH OF SEASIDE PARK, ET AL.,
Defendants.

THOMPSON, U.S.D.J.
INTRODUCTION
This matter comes before the Court upon the Borough Defendants’1 Appeal of Magistrate
Judge Tonianne Bongiovanni’s Letter Order dated September 27, 2012. [Doc. No. 237].
Plaintiff Stephen D’Onofrio (“Plaintiff”) opposes. [Doc. No. 245]. The Court has decided the
motion upon the written submissions of the parties and without oral argument pursuant to
Federal Rule of Civil Procedure 78(b). For the reasons discussed herein, the Borough
Defendants’ appeal is denied.

The term “ the Borough Defendants” refers collectively to: the Borough of Seaside Park;
Former Mayor Robert W. Matthies; Mayor Thomas E. Connors; the Seaside Park Borough
Council; Susan Maday; Maryanne Palmisano; John “Jack” Moyse; Benjamin J. Kaiser; Sharon
Pratico; Nancy Koury; James Jablonski; Robert Brennan; John Coughlin; Seaside Park Police
Department; William A. Beining, III; Edward C. Dickson; Daniel Fitzgerald; Lt. Francis Murphy
Larkin; James Leone; Brian McKay; Stephen Shadiack; Brian Jankowski; Seaside Park
Municipal Planning Board; Faith Liguori; Kathleen Hughes; Anthony DiCaro; Robert
Bellantoni; Seaside Park Municipal Zoning Board; Andrew Sbordone; Martin Wilk, Jr.; Kenneth
Deshay; Michael Giuliano; Francis Losey; Michael Tierny; Raymond Sites; Geoffrey N.
Schwartz; Seaside Park Code Enforcement Department; James Anderson; Robert Nora; Rejean
Laliberte; Gary Swirczynski; Richard Barbarise; and Charles Hollins.
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BACKGROUND
As Plaintiff and the Borough Defendants, [see supra n. 1], are already well familiar with
the facts of this case, this opinion will include only those facts relevant to the current motion.
Plaintiff was the owner and operator of the SawMill Café (“SawMill”), located on the
Boardwalk in the Borough of Seaside Park, New Jersey. [Doc. No. 1, hereinafter, “Complaint,”
at ¶ 2]. Plaintiff claims that the Borough Defendants inappropriately interfered with his right to
control and operate SawMill through tortious, fraudulent and extortionate conduct. [Id. at ¶ 3].
Plaintiff specifically asserts violations of the Equal Protection and Due Process Clauses of the
14th Amendment and the 1st Amendment; 42 U.S.C. § 1983 of the Civil Rights Act; 42 U.S.C. §
1985 of the Civil Rights Act; the Racketeer Influenced and Corrupt Organizations Act (“RICO”),
18 U.S.C. § 1961 et seq.; and N.J.S.A. 2C:41-1 et seq. (“New Jersey RICO”). [Id.]. Many of the
allegations raised by Plaintiff in this matter relate to prior, underlying legal disputes between the
parties. [See, generally, id.]. Although most of the underlying litigation is complete, Plaintiff
and the Borough Defendants are still presently engaged in an administrative law action before
the Ocean County Construction Board of Appeals. [Doc. No. 229 at I.a.i.; Doc. No. 223 at II].
As part of the current litigation, Plaintiff seeks to recover attorney costs and fees as
damages. [Complaint at ¶¶ 167-68]. In producing evidence to support an award amount,
Plaintiff wishes to protect any information in the attorney billing statements that may be
privileged attorney-client communication. [See, generally, Doc. No. 229]. In contrast, the
Borough Defendants claim that by including attorney costs and fees as part of the damages
claim, Plaintiff has placed any and all communications contained within the billing statements
“at issue,” thereby waiving any attorney client privilege. [Doc. No. 223-1].

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Magistrate Judge Tonianne Bongiovanni, [hereinafter “Judge Bongiovanni”], who has
worked with the parties on this case since at least February 16, 2010, issued a Letter Order on
September 27, 2012, permitting Plaintiff to submit summaries of legal bills to the Borough
Defendants in lieu of unredacted billing logs. [Doc. No. 221]. The Order further requires
Plaintiff to provide attorney certifications assuring that the work summarized pertains only to the
relevant SawMill litigation. [Id.]. Specifically, Judge Bongiovanni’s Order reads, in pertinent
part:
. . . [K]eeping in mind that information concerning Plaintiff’s legal bills is relevant only
to Plaintiff’s damages claim, the Court does not find that Plaintiff is seeking to use the
attorney-client privilege as a sword and a shield: disclosing certain selected
communications for self-serving purposes while at the same time restricting the Borough
Defendants’ access to others. As a result, at this time the Court shall not require Plaintiff
to produce unredacted billing statements. Instead, Plaintiff shall be permitted to protect
the privileged information contained in his legal bills. Moreover, in order to promote
efficiency and avoid the time consuming and costly process of requiring line-by-line
redactions, the Court shall exercise its discretion to permit Plaintiff to provide detailed
summaries of his legal bills along with attorney certifications verifying that the numbers
reflected in the summaries include only services rendered for litigation concerning the
SawMill Café, rather than the actual redacted bills.
[Id.]. The Borough Defendants have moved to vacate the Order as clearly erroneous and
contrary to law for its failure to consider the at-issue doctrine, and contend that Plaintiff must
provide complete, unredacted billing statements for all attorneys’ fees for which Plaintiff seeks
recover. [Doc. No. 223, 223-1]. Aside from arguing that Plaintiff has waived the privilege to
any protected information in the relevant billing statements by requesting attorney costs and fees
as part of his damages claim, the Borough Defendants further argue that the billing summaries
and accompanying attorney certifications will “foreclose[ the Borough Defendants] . . . from
independently assessing the pertinence and reasonableness of the fees reflected in the billing
statements, and [will] instead force[ the Borough Defendants] . . . to take Plaintiff and his

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attorneys at their word. . . .” [Id. at 1-2]. Plaintiff opposes the appeal, arguing that Third Circuit
case law does not support the application of the at-issue doctrine in this case. [Doc. No. 229].
STANDARD OF REVIEW
In reviewing a magistrate judge decision on a non-dispositive matter, the moving party
bears the burden of demonstrating that the decision is ‘clearly erroneous or contrary to law.’
U.S. v. Sensient Colors, Inc., 649 F. Supp. 2d 309, 314-15 (D.N.J. 2009); Gunter v. Ridgewood
Energy Corp., 32 F. Supp. 2d 162, 164 (D.N.J. 1998); Cardona v. Gen. Motors Corp., 942 F.
Supp. 968, 971 (D.N.J. 1996); Exxon Corp. v. Halcon Shipping Co., Ltd., 156 F.R.D. 589, 591
(D.N.J. 1994); 28 U.S.C. § 636(b)(1)(A); Fed. R. Civ. P. 72; L. Civ. R. 72.1(c), comment e. “A
finding is clearly erroneous when ‘although there is evidence to support it, the reviewing court
on the entire evidence is left with the definite and firm conviction that a mistake has been
committed.’” Cooper Hosp./Univ. Med. Ctr. v. Sullivan, 183 F.R.D. 119, 127 (D.N.J. 1998)
(quoting Lo Bosco v. Kure Eng. Ltd., 891 F. Supp. 1035, 1037 (D.N.J. 1995)); Cardona, 942 F.
Supp. at 971; South Seas Catamaran, Inc. v. M/V Leeway, 120 F.R.D. 17, 21 (D.N.J 1988), aff'd,
993 F.2d 878 (3d Cir. 1993). “[A] ruling is contrary to law if the magistrate judge has
misinterpreted or misapplied applicable law.” State Nat’l. Ins. Co. v. Cnty. of Camden, 2012 WL
960431, *1 (D.N.J. March 21, 2012) (citing Gunter, 32 F. Supp. 2d at 164). A magistrate
judge’s legal conclusions will be reviewed de novo. Cooper Hosp., 183 F.R.D. at 127.
In conducting this analysis, the Court recognizes that a magistrate judge’s ruling on a
non-dispositive matter is entitled to great deference. Kresefky v. Panasonic Commc’ns and Sys.
Co., 169 F.R.D. 54, 64 (D.N.J.1996) (“Where, as here, the magistrate has ruled on a nondispositive matter such as a discovery motion, his or her ruling is entitled to great deference and
is reversible only for abuse of discretion.”). This is especially so “where the Magistrate Judge

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has managed [the] case from the outset and developed a thorough knowledge of the
proceedings.” Cooper Hosp., 183 F.R.D. at 127 (quoting Public Interest Research Grp. v.
Hercules, Inc., 830 F. Supp. 1525, 1547 (D.N.J. 1993), aff'd on other grounds and rev'd on other
grounds, 50 F.3d 1239 (3d Cir. 1995)).
DISCUSSION
The Borough Defendants argue that Judge Bongiovanni’s September 27, 2012 letter order
is clearly erroneous and contrary to law in that it fails to “consider, or even address, the doctrine
of ‘at issue’ waiver.” [Id.]. Under that doctrine, “[w]hen a party to a lawsuit puts [privileged]
information at issue by making it relevant to the case, and the application of the privilege would
deny the opposing party access to information vital to its defense,” the party has waived the
privilege. George v. Siemens Indus. Automation, Ind., 182 F.R.D. 132, 139 (D.N.J. 1998). The
Borough Defendants argue that because Plaintiff has asserted a damages claim against the
Borough Defendants for attorney costs and fees, Plaintiff has put the attorney-client billing
statements and any privileged information contained therein at issue. [Doc. No. 223-1 at 6-8].
In pertinent part, the Borough Defendants argue that:
[Plaintiff] cannot now produce only the information relating to the fees that he wants the
Borough Defendants to see. The Borough Defendants are entitled to review the billing
statements in their entirety to determine, for themselves, whether the services for which
Plaintiff seeks reimbursement were all related to the litigation over the SawMill, as
distinguished from other, unrelated matters. In addition, the Borough Defendants are
entitled to review the billing statements to determine whether the fees were reasonable,
whether the time billed for various tasks was reasonable, and whether the tasks billed
were actually necessary for the litigation.
[Id. at 8]. The Borough Defendants go on to state their concern that Plaintiff might “shade the
facts” in his summaries “to make the fees appear recoverable when, for any number of reasons . .
. they are not.” [Id. at 9].

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The Court is aware of the fine balance that must be struck when dealing with the
attorney-client privilege. The privilege must not be used as both a sword and shield against
another party. See, e.g., Berckeley Inv. Grp., Ltd. v. Colkitt, 455 F.3d 195, n. 24 (3d Cir. 2006).
However, the Court does not agree with the Borough Defendants that Judge Bongiovanni’s
solution to balancing the tension between the attorney-client privilege and fairness concerns in
this case is clearly erroneous or contrary to law.
In reviewing Third Circuit precedent on what billing information must be provided to
sustain a damages award, this Court notes that a party seeking attorneys’ fees must “submit
evidence supporting the hours worked and rates claimed.” Rode v. Dellarciprete, 892 F.2d 1177,
1183 (3d Cir. 1990) (quoting Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). More
specifically, “a fee petition should include ‘some fairly definite information as to the hours
devoted to various general activities, e.g., pretrial discovery, settlement negotiations, and the
hours spent by various classes of attorneys, e.g., senior partners, junior partners, associates.’”
Washington v. Philadelphia County Court of Common Pleas, 89 F.3d 1031, 1037-38 (3d Cir.
1996) (quoting Rode, 892 F.2d at 1190). “[S]pecificity should only be required to the extent
necessary for the district court to determine if the hours claimed are unreasonable for the work
performed,” and “it is not necessary to know the exact number of minutes spent nor the precise
activity to which each hour was devoted nor the specific attainments of each attorney.” Id.
(internal quotations omitted). If the opposing party then objects to the reasonableness of the
hours expended or the attached hourly rate, “the district court has a great deal of discretion to
adjust the fee award in light of those objections.” Rode, 892 F.2d at 1183.
The Court is unconvinced that the above requirements cannot be met via detailed
summaries of billing statements, or that the Borough Defendants will be unable to bring forward

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objections concerning time spent on projects, the reasonableness of fees, and whether the tasks
billed were actually necessary for litigation. If the statements are insufficiently detailed, the
Court can order further disclosure; indeed, the language of Judge Bongiovanni’s Letter Order
indicates the desire to leave open just that possibility. [See Doc. No. 221 (“at this time the Court
shall not require Plaintiff to submit unredacted billing statements . . . . Moreover, in order to
promote efficiency and avoid the time consuming and costly process of requiring line-by-line
redactions, the Court shall . . . permit Plaintiff to provide detailed summaries of his legal bills . . .
” (emphasis added))]. The Letter Order also provides a means by which parties may confer and
address the Court in the event of a dispute. [Id. (“In the unlikely event that the parties are unable
to resolve any issue that arises with respect to the aforementioned summaries and certifications,
then they are directed to submit a joint letter regarding same to the Court . . . .”)]. Finally, the
Court fails to see how trusting attorney certifications with regards to the billing statements is
significantly different than the trust opposing counsel normally must exercise when receiving
copies of billing statements recorded at another firm.
But even if the above affirmative requirements can be met by the billing statements, the
Borough Defendants argue that the current situation falls under the “at issue” doctrine and should
be governed by that standard. Upon review of the case law, the Court does not find that the “at
issue” doctrine clearly applies.
The Borough Defendants acknowledge that there is no Third Circuit case law directly on
point; those Third Circuit cases that do consider the at-issue doctrine in the context of the
attorney-client privilege do so in situations where the advice of counsel is being utilized as an
affirmative defense. See, e.g., Glenmede Trust Co. v. Thompson, 56 F.3d 476, 486 (3d Cir.
1995); Rhone-Poulenc Rorer v. Home Indem. Co., 32 F.3d851, 863 (3d. Cir. 1994); In re G-I

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Holdings Inc., 218 F.R.D. 428, 431 (D.N.J. 2003). Those cases are reasonably distinguishable,
given that the content of the communications are put in issue; here, arguably, only non-privileged
details such as the type of communication and time spent are in issue.
The Borough Defendants point instead to cases from other jurisdictions in which courts
reject either redacted billing statements or summaries in support of indemnification or an award
of attorneys’ fees. E.g., Equitable Prod. Co. v. Elk Run Coal Co. Inc., 2008 WL 5263735
(S.D.W. Va. Oct. 3, 2008); Energy Capital Corp. v. U.S., 45 Fed. Cl. 481 (Fed. Cl. 2000); Essex
Builder’s Grp., Inc. v. Amerisure Ins. Co., 2007 WL 700851 (M.D. Fla. Mar. 1, 2007); Pillsbury
Winthrop Shaw Pittman LLP v. Brown Sims, P.C., 2010 WL 56045 (S.D. Tex. Jan. 6, 2010);
Pamida, Inc. v. E.S. Originals, Inc., 281 F.3d 726 (8th Cir. 2002); Aecon Bldgs., Inc. v. Zurich N.
Am., 2008 WL 2434205 (W.D. Wash. June 13, 2008); Am Econ. Ins. Co. v. Schoolcraft, 2007
WL 1229308 (D. Colo. Apr. 25, 2007).
While most of the cases cited by the Borough Defendants are unpublished lower court
opinions, two circuit courts have found a waiver of the attorney-client privilege in
indemnification actions where the prior underlying actions had been resolved. Ideal Electronic
Sec. Co., Inc. v. Int’l Fidelity Ins., Co., 129 F.3d 143 (D.C.C. 1997); Pamida, Inc. v. E.S.
Originals, Inc. v. E.S. Originals, Inc., 281 F.3d 726 (8th Cir. 2002). In Ideal, the court found
that“[b]y claiming indemnification of attorney’s fees . . . and offering the billing statements as
evidence of the same, [a party] waive[s] its attorney-client privilege with respect to the redacted
portions of the billing statements and any other communications going to the reasonableness of
the amount of the fee award.” Ideal, 129 F.3d at 152. Moreover, “[a]lthough the reasonableness
of the fee award is ultimately within the District Court’s discretion, [the opposing party] must

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first be allowed the opportunity to challenge the reasonableness of the fees following full
disclosure of the billing statements.” Id.
It may be that Plaintiff ultimately must present full, unredacted billing statements in order
to fairly and clearly justify an award of damages. However, the Court does not at this time find
good reason to overturn Judge Bongiovanni’s Order in light of both fairness and efficiency
concerns, and absent further direction from the Third Circuit. Liability has not yet been
established, and there is the possibility that full revelation of the billing statements may expose
privileged information pertinent to the current administrative action between Plaintiff and the
Borough Defendants before the Ocean County Construction Board of Appeals. Judge
Bongiovanni, who has been involved in this case for almost three years, appears to have made a
reasonable decision based upon current Third Circuit law, and furthermore, intentionally left the
window open for the Borough Defendants to lodge objections should the detailed summaries of
Plaintiff be found wanting. The Court will take no further action at this time.
CONCLUSION
For the reasons discussed herein, the Borough Defendants’ Appeal of the Magistrate
Court Order is denied. An appropriate order accompanies this opinion.

/s/Anne E. Thompson
ANNE E. THOMPSON, U.S.D.J

Date: 19th of December, 2012

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