6340 NB LLC v. Capital One, N.A.

Filing 121

ORDER denying 94 Motion to Compel. For the reasons set forth in the attached Order, Capital One's motion to compel documents (DE 94 ) is hereby DENIED. So Ordered by Magistrate Judge James M. Wicks on 11/18/2022. (DF)

FILED 
CLERK 

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
-------------------------------------------------------------X
6340 NB LLC,
Plaintiff,
-against-

November 18, 2022
U.S. DISTRICT COURT 
EASTERN DISTRICT OF NEW YORK 
LONG ISLAND OFFICE 

MEMORANDUM ORDER
20-CV-02500 (JMA)(JMW)

CAPITAL ONE, N.A.,
Defendant.
-------------------------------------------------------------X
A P P E A R A N C E S:
Ronald J. Rosenberg
John S. Ciulla
Joshua Marc Liebman
Kenneth E. Aneser
Peter Williams
William J. Birney
Rosenberg Calica & Birney LLP
100 Garden City Plaza, Suite 408
Garden City, NY 11530
For Plaintiff 6340 NB LLC
Adam Kirschbaum
James Wilson Perkins
Michelle D Gambino
Michael Hass
Michael Patrick Manning
Shirin Afsous
Greenberg Traurig, P.A
One Vanderbilt Avenue
New York, NY 10017
For Defendant Capital One, N.A.
WICKS, Magistrate Judge:
Before the Court is Defendant Capital One, N.A.’s (“Capital One”) motion to compel
Plaintiff 6340 NB LLC (“6340 NB”) to produce allegedly critical zoning documents and
communications by and between attorneys Kevin Walsh (“Walsh”) and Laura Schaefer

(“Schafer”) of the firm Walsh Markus McDougal & DeBellis LLP (“WMMD”) in response to
Document Request Nos. 9, 30-36, 39-42, 45-46, 73 and 75, over 6340 NB’s objections on
various privilege grounds. (DE 94.) Oral argument was held on the motion on November 14,
2022. (DE 118.) For the reasons that follow, Capital One’s motion to compel documents is
hereby DENIED.
RELEVANT BACKGROUND
The Court and the parties are well versed in the underlying facts and allegations of this
case from prior orders which do not bear repeating here.
Relevant here is that pursuant to a 2017 Ground Lease and its subsequent amendments,
6340 NB was to acquire and rezone two residential parcels in order to construct a Capital One
bank branch (the “Property”). (DE 42 at ¶¶ 14-22.) In order to obtain zoning approval, 6340 NB
required Capital One’s cooperation to provide certain plans and specifications for the anticipated
branch. (Id. at ¶ 18.) After several extensions of deadlines, which 6340 NB alleges is at the
hands of Capital One, on July 24, 2019, 6340 NB finally filed the requisite zoning application.
(Id. at ¶¶ 26-28.) A public hearing was held before the Town Board of the Town of North
Hempstead on December 17, 2019. (Id.) Capital One contends that the Town would not agree to
the rezoning (see DE 94), but 6340 NB alleges progress was made during the hearing and the
Town was generally supportive. (See DE 42 at ¶ 28.) Nonetheless, just over a month later, on
January 31, 2020, Capital One served a Notice of Termination of the Ground Lease for 6340
NB’s failure to timely perform its obligations under the Ground lease (“Termination Notice).
(Id. at ¶ 31.) 6340 NB contends that this Termination Notice was wrongful and an act of
anticipatory repudiation because 6340 NB was well within the deadlines set in an amendment to
the Ground Lease. (Id. at ¶ 33.) In an effort to keep the deal alive, 6340 NB asked Capital One

2

to withdraw the Termination Notice, and in an email to Capital One’s counsel, stated: “We are
ready willing and able to proceed but to do so require that Capital One withdraw the
termination.” (Id. at ¶ 38.) Capital One did not withdraw the Termination notice and thus 6340
NB commenced this action to recover damages based on Capital One’s alleged breach of
contract and anticipatory repudiation of a Ground Lease and its subsequent amendments. (See
DE 42.) Capital One has counterclaimed against 6340 NB alleging fraud and breach of contract
in connection with 6340 NB’s alleged failure to perform under the Ground Lease. (See DE 89.)
DISCUSSION
In 2018, attorneys Walsh and Schaefer of WMMD were engaged to facilitate the zoning
approval necessary under the Ground Lease. The threshold question is, however: engaged by
whom? The question of whether Capital One is entitled to the documents it seeks necessarily
turns on whether Walsh and Schaefer were attorneys for 6340 NB, Capital One, or both.
Capital One seeks to compel 6340 NB to produce documents in response to sixteen
document requests concerning 6340 NB’s efforts to rezone the Property. (See DE 94-1.) In
response to those discovery requests, 6340 NB has withheld various emails from dates ranging
from November 29, 2017, through March 31, 2022, based on the attorney-client and work
product privileges, and has produce a corresponding privilege log (“Walsh/Schaefer Emails”).
(DE 94-2.) 1 Capital One argues it is entitled to the Walsh/Schaefer Emails because (1) no
privilege exists as to communications involving Walsh and Schaefer because Walsh and
Schaefer were acting as attorneys for both 6340 NB and Capital One with respect to the zoning
approval; (2) 6340 NB has put the issues surrounding rezoning at issue by claiming that it was

During oral argument, counsel for 6340 NB estimated that it was withholding less than 100 emails.
Further, to the extent the privilege log also references emails of Katrine A. Beck of Fullerton Beck LLP
counsel for Capital One confirmed that it is not seeking to compel those withheld emails, but rather only
the WMMD emails.
1

3

“ready willing and able” to perform under the Ground Lease; (3) the documents are not protected
under the work product doctrine because they were not prepared in anticipation of litigation and
Capital One has otherwise demonstrated a substantial need for those documents; and (4) Walsh
and Schaefer were hired for a business purpose and the sought after materials are factual in
nature, not legal. (DE 94.) Capital One further requests that to the extent the Court a privilege to
the exclusion of Capital One exists, that the Court conduct an in-camera review to ensure all
non-privileged material is produced. (Id.)
In opposition, 6340 NB argues that the Walsh/Schaefer Emails are protected by the
attorney-client privilege because WMMD did not jointly represent 6340 NB and Capital One and
because 6340 NB has not put these communications at issue. (DE 99.) 6340 NB further contests
the need for an in-camera review. (Id.)
A. Did Walsh and Shaefer Represent Both 6340 NB and Capital One?
Capital One argues that no privilege exists as to the Walsh and Schafer emails because
WMMD acted as Capital One’s attorney in all aspects of the legal work done on the rezoning.
(DE 94; DE 108.) Capital One relies on two related but distinct doctrines and at times seems to
conflate the two: (1) the common-interest doctrine; and (2) the joint-client exception. (See id.)
In response, 6340 NB argues that the Walsh/Schaefer Emails are subject to the attorney-client
privilege because WMMD did not jointly represent 6340 NB and Capital One. (DE 100-2; DE
107; DE 113.)

4

i.

Common-Interest Doctrine 2

Typically, when a communication between a client and an attorney is shared in the
presence of a third party, the attorney-client privilege is waived. Schultz v. Milhorat, No. CV 10103 (AKT), 2011 WL 13305347, at *2 (E.D.N.Y. Apr. 11, 2011). The common-interest doctrine
functions to extend the attorney-client privilege and prevent waiver when an otherwise privileged
communication is disclosed to a third party. Id. (common-interest privilege “acts as an
exception to these general waiver rules in order to facilitate cooperative efforts among parties
who share common interests”); SR Int'l Bus. Ins. Co. v. World Trade Ctr. Properties LLC, No. 01
CIV. 9291 (JSM), 2002 WL 1334821, at *3 (S.D.N.Y. June 19, 2002) (“The common interest
privilege is a limited exception to the general rule that the attorney-client privilege is waived
when a protected communication is disclosed to a third party”). The purpose of the commoninterest doctrine is to “protect the confidentiality of communications passing from one party to
the attorney for another party where a joint defense effort or strategy has been decided upon and
undertaken by the parties and their respective counsel.” Schaeffler v. United States, 806 F.3d 34,
40 (2d Cir. 2015). The doctrine “applies where parties are represented by separate counsel but
engaged in a common legal enterprise.” Fresh Del Monte Produce, Inc. v. Del Monte Foods,

“Common-interest doctrine” is also frequently referred to as “common-interest privilege.” However, the
mere fact that although sometimes the doctrine is called the “common-interest privilege,” it is in fact not
an independent source of privilege, bur rather “it applies only to communications that otherwise would be
protected by the attorney-client or work product doctrine.” In re Lifetrade Litig., No.
17CV2987JPOKHP, 2022 WL 3644357, at *4 (S.D.N.Y. Aug. 24, 2022); Carnegie Inst. of Washington v.
Fenix Diamonds, LLC, No. 20-CV-200 (JSR), 2020 WL 7074726, at *1 (S.D.N.Y. June 30, 2020) (“The
common-interest doctrine is not a source of privilege in its own right; rather, it is an exception to the rule
that attorney-client privilege is generally waived by voluntary disclosure of the [privileged]
communication to another party”) (internal quotes omitted).
2

5

Inc., No. 13 CIV. 8997 JPO GWG, 2015 WL 3450045, at *3 (S.D.N.Y. May 28, 2015) (quotes
omitted).
The common-interest doctrine is a shield, however, and not used as a sword. Here,
Capital One seeks to use the common-interest doctrine to essentially invade the attorney-client
privilege that exists between WMMD and 6340 NB and entitle Capital One to otherwise
privileged material. This is not the function of the doctrine. See e.g., E. End Eruv Ass'n, Inc. v.
Town of Southampton, No. CV 13-4810 (AKT), 2014 WL 12847276, at *8 (E.D.N.Y. Mar. 13,
2014) (finding documents and communications between plaintiff and non-parties to be shielded
from disclosure by defendant because of a common legal interest); United States v. Zhu, 77 F.
Supp. 3d 327, 331 (S.D.N.Y. 2014) (finding documents between two companies sharing a legal
interest were immune from discovery by plaintiff); In re Velo Holdings Inc., 473 B.R. 509, 518
(Bankr. S.D.N.Y. 2012) (common-interest doctrine applied to shared documents and
communications between plaintiff and its agent as to prevent disclosure to defendant).
Accordingly, the common-interest doctrine is inapplicable here. 3

In a supplemental submission filed post-oral argument by Capital One, Capital One contends that
Feighan (180 A.D.3d at 874) and In re McCormick (287 A.D.2d 457, 457 (2d Dep’t 2001)) are examples
of instances where the common-interest doctrine is used a “sword” to pierce a privilege, rather than as a
“shield” to protect it. The Court disagrees. Both Feighan and McCormick involve circumstances where
parties were represented by the same attorney and subsequently engaged in litigation. See Feighan, 180
A.D.3d at 874) (“Here, Vecchio's joint representation of the parties in 2013 with respect to the preparation
of estate planning documents . . . constituted representation with respect to the same matter, and we agree
with the Supreme Court's determination that the attorney-client privilege could not be invoked to protect
confidential communications concerning Vecchio's representation of the parties with regard to the
defendant's 2013 revocable trust”); McCormick, 287 A.D.2d at 457 (“The appellant and the objectant
Suzanne McCormick were both executors of the estate of Edmund J. McCormick. The law firm of White
and Case represented the estate and the executors”). This implicates the joint-client exception, not the
common-interest doctrine, which requires that the parties actually be represented at one time by the same
attorneys.
3

6

ii.

Joint-Client Exception

The joint-client exception provides that “[a]n attorney who represents two parties with
respect to a single matter may not assert the privilege in a later dispute between the clients.”
Quintel Corp., N.V. v. Citibank, N.A., 567 F. Supp. 1357, 1364 (S.D.N.Y. 1983); Feighan v.
Feighan, 180 A.D.3d 873, 874, 118 N.Y.S.3d 674, 676 (2020) (“Generally, when an attorney
represents two or more parties with respect to the same matter, the attorney-client privilege may
not be invoked to protect confidential communications concerning the joint matter in subsequent
adverse proceedings between the clients”). Importantly, and unlike the common-interest
doctrine, the “exception only applies, however, where the attorney actually represented both
parties.” (Quintel Corp., N.V., 567 F. Supp. at 1364). And so, to determine the applicability of
this exception, the Court must first determine whether WMMD actually represented Capital One.
Courts in this jurisdiction are guided by six factors in determining whether an attorneyclient relationship exists:
1) whether a fee arrangement was entered into or a fee paid; 2) whether a written
contract or retainer agreement exists indicating that the attorney accepted
representation; 3) whether there was an informal relationship whereby the attorney
performed legal services gratuitously; 4) whether the attorney actually represented
the individual in one aspect of the matter (e.g., at a deposition); 5) whether the
attorney excluded the individual from some aspect of the litigation in order to
protect another (or a) client's interest; 6) whether the purported client believes that
the attorney was representing him and whether this belief is reasonable.
Protostorm, LLC v. Antonelli, Terry, Stout & Kraus, LLP, 834 F. Supp. 2d 141, 154–55
(E.D.N.Y. 2011).
Here, it is undisputed that no retainer agreement exists between Capital One and
WMMD. (DE 100-3, Declaration of Kevin M. Walsh [“Walsh Decl.”] at ¶ 3) (“At the outset, I
want to make clear that WMMD did not at any time have an agreement, written, oral or
otherwise, to represent Capital One in connection with the zoning process, or with respect to any

7

other matter”); DE 111-1, Declaration of Frank DelGiudice Supplementing Motion to Compel
[“DelGiudice Dec.”] at ¶ 11) (“Additionally, even though there was no written engagement
agreement between Capital One and Walsh and Schafer on this project. . .”). But one was
entered between 6340 NB and WMMD. (Walsh Decl. at ¶ 4; DE 107-1.) 6340 NB contends that
WMMD started providing legal services to 6340 NB concerning the Ground Lease and zoning
issue in late November 2017, but the relationship was formally reduced to a writing through an
engagement letter dated September 25, 2018 (“Engagement Letter”). (DE 107 at 1 n. 1; DE 1071.) The Engagement Letter designates 6340 NB as the “Client” and provides that WMMD will
represent 6340 NB in connection with the Property and “a number of zoning approvals.” (DE
107-1.) The Engagement Letter further goes on to state that the firm had already met with the
Planning Department of North Hempstead to discuss a zoning application and that the firm’s
services would encompass all administrative hearings. (Id.) The Engagement Letter makes no
mention whatsoever of Capital One. 4 (Id.)
Whether a fee arrangement was entered into by Capital One or fees were paid is a
thornier issue. Walsh, a partner at WMMD, attests that Capital One did not pay any of
WMMD’s legal fees and instead, all fees were billed to, and paid by, 6340 NB. (Walsh Decl. at
¶ 4.) However, emails between Capital One and 6340 NB demonstrate a potential fee
arrangement was entered into. (See DE 116-2.) 5 Specifically, as it related to getting zoning
approvals for the branch’s drive-thru, Capital One offered to reimburse 6340 NB for Walsh’s
work, or in the alternative, offered to pay Walsh directly. (Id.) 6340 NB did not object or raise
any concerns, but rather stated, “[w]hatever way is easier on your end. Either way works for us.”
4

The Court notes that 22 NYCRR § 1215.1 requires attorneys to give every client an engagement letter.

For clarity, Richard Becker (“Becker”) and David Ross (“Ross”), involved in the cited email chain are
the sole members of 6340 NB. (See DE 53.)
5

8

(Id.) Indeed, the idea may have come from 6340 NB itself. A month prior, when initially
confronted with how the parties should proceed applying for the drive-thru zoning, Becker
drafted an email for Ross to send to Capital One wherein he suggests 6340 NB, as the landlord,
handle the drive-thru zoning so there would be one cohesive application,” and offered to Capital
One: “We can have the attorney break out billing for each task and CapOne can pay its portion.”
(Id.) It is unclear from the record if this email was ever sent and it was confirmed during
argument that WMMD did not ultimately break out any billing. Nonetheless, the fact still stands
that this pay arrangement never materialized and Capital One did not actually pay any of
WMMD’s legal fees. Further, inasmuch as there was a discussion between Capital One and
6340 NB about a potential fee split, it does not appear that WMMD was ever a party to these
discussions. It cannot be said that an informal relationship existed between WMMD and Capital
One whereby WMMD performed legal services gratuitously. 6
Next, the record suggests that WMMD did in fact exclude Capital One from some aspect
of its representation to protect 6340 NB’s interest. Capital One argues that Capital One, Walsh,
and Schaefer routinely worked together and over the course of the transaction there are hundreds
of communications between them. (DE 108.) However, the very fact that there are numerous
emails over the course of three years between 6340 NB, Walsh, and Schaefer in which Capital
One was excluded, demonstrates that there was a relationship between WMMD and 6340 NB
that Capital One did not share. (See DE 94-2.)
The analysis of the remaining factors, namely whether the attorney actually represented
the individual in one aspect of the matter, whether the purported client believes that the attorney

Indeed, the engagement letter rule itself requires that “an attorney who undertakes to represent a client
and enters into an arrangement for, charges or collects any fee from a client shall provide” the
engagement letter to the client. 22 N.Y.C.R.R. Part 1215. That was not done here.
6

9

was representing him, and whether this belief is reasonable, go hand in hand in this
circumstance. Capital One asserts that because Walsh and Schaefer worked directly with Capital
One’s agents, architects, and engineers with respect to the rezoning and communicated with both
6340 NB and Capital One about the proposed site plan and the strategy by which to approach the
County and the Town, Walsh and Shaefer were representing both entities. (DE 94; see 94-3.)
Capital One also points to the zoning application submitted by WMMD to the Town of North
Hempstead on July 24, 2019, which lists Capital One as the “Applicant,” and the transcript of a
public hearing before the Town (“Town Hearing”) wherein Walsh introduces himself as
speaking on behalf speaking on behalf of both 6340 NB and Capital One. (Id.; see 94-4; 94-5.)
The Court does not find that either fact tips the scale in favor of finding that WMMD
represented Capital One. While the zoning application lists Capital One as the applicant, the
application cover letter, printed on WMMD letterhead and signed by Shaefer, unequivocally
states: “I represent, 6340 NB LLC, the owners of the above property.” (DE 94-5). A few months
later, on October 8, 2019, Schaefer again wrote the Town clearly stating, “I represent 6340 NB
LLC, the owners of the Premises.” (DE 100-6.) Indeed, under the Ground Lease, zoning for the
project was 6340 NB’s obligation. (DE 94.)
There was no such unequivocal language used at the Town Hearing. Review of the Town
Hearing transcript reveals that the Town Board members repeatedly and incorrectly identify
6340 NB as the applicant. 7 (Id.) So, when Walsh first states that he is “speaking for the
applicant” it suggests that he is speaking on behalf of 6340 NB, not Capital One. However,
Walsh then goes on to further introduce himself as belonging to the firm WMMD and speaking
for the owner of the property (6340 NB) and the proposed tenant (Capital One) and is further
7

Recall, the actual zoning application lists Capital One as the applicant. (See 94-5.)
10

joined by a team of civil engineers, architects, traffic consultants, and a representative from
Capital One. However, Walsh’s role simply as the presenter at the Town Hearing doing
introductions is insufficient under these facts to create an attorney-client relationship between
Capital One and WMMD. 8
What is more, other documents submitted by Capital One illustrate that it was clear to
Capital One that Walsh and Shaefer were 6340 NB’s attorneys and not its own. For instance, in
the email sent by Capital One to 6340 NB inquiring about how to proceed with the drive-thru
approval, Capital One states, “[w]e also need to discuss how to move forward with your attorney
running point on getting our drive-thru approved with the ZBA.” See DE 116-2 (emphasis
added). 6340 NB responded to that inquiry identifying Walsh of WMMD as 6340 NB’s zoning
attorney. See id. (“Our zoning attorney Kevin Walsh (Walsh Markus McDougal & DeBellis,
LLP) will be able to handle your applications for the drive-thru”). Even when discussing the
potential fee arrangement as discussed above, Capital One refers to Walsh to 6340 NB as “your
zoning attorney.” (Id.) Further, in an April 3, 2019, email, well into the progression of the
zoning approval project, Capital One’s project manager sent an internal email referring to
WMMD as “the landlord’s attorney.” (See DE 100-4.) These facts lend themselves to a finding
that Capital One did not believe that Walsh and Shaefer were representing it and even if so, such
a belief was not reasonable under the circumstances.
Upon consideration of these factors—that there was no retainer agreement between
WMMD and Capital One, that Capital One did not pay any of WMMD’s legal fees (despite
offering to do so), that WMMD excluded Capital One from certain aspects of the project, that on
multiple occasions WMMD unequivocally stated it represented 6340 NB, only, and Capital
Walsh’s participation in administrative hearings is a delegated obligation under the Engagement Letter
with 6340 NB.

8

11

One’s own recognition that WMMD was 6340 NB’s attorneys—the Court finds that there was no
attorney-client relationship between Capital One and WMMD. Therefore, the joint-client
exception does not apply here. See Quintel Corp., N.V. v. Citibank, N.A., 567 F. Supp. 1357,
1364 (S.D.N.Y. 1983) (declining to apply the joint client exception, finding the “fact that
Citibank attorneys engaged in negotiations and performed legal services in connection with the
acquisition does not make Gajria the client of these attorneys”).

B. Did 6340 NB put the Withheld Emails “At Issue,”
thus Entitling Capital One to Their Disclosure?
Capital One argues that 6340 NB must turn over the Walsh/Schafer Emails which relate
to whether 6340 NB could have successfully rezoned the Property because it waived any
purported attorney-client privilege when 6340 NB put the documents squarely at issue by
alleging that it was “ready, willing, and able to perform” its obligations under the Ground Lease.
(DE 94; DE 108.)
In opposition, 6340 NB argues that an “at issue” waiver is inapplicable here because
6340 NB does not assert any claim or defense that it intends to prove by the use of any privileged
communications with Walsh and Schaefer. (DE 100-2; DE 113.)
An “at-issue” waiver (sometimes referred to as “implied waiver”) is typically found
when:
(1) [the] assertion of the privilege was the result of some affirmative act, such as
filing suit, by the asserting party; (2) through this affirmative act, the asserting party
put the protected information at issue by making it relevant to the case; and (3)
application of the privilege would have denied the opposing party access to
information vital to his [claim or] defense.

12

Pall Corp. v. Cuno Inc., 268 F.R.D. 167, 168 (E.D.N.Y. 2010). “As per Second Circuit
jurisprudence, the key to a judicial finding of an implied waiver ‘is some showing by the party
arguing for a waiver that the opposing party relies on the privileged communication as a claim or
defense or as an element of a claim or defense.’” Nycomed U.S. Inc. v. Glenmark Generics Ltd.,
No. 08-CV-5023 CBA RLM, 2009 WL 3334365, at *1 (E.D.N.Y. Oct. 14, 2009) (citing In re the
County of Erie, 546 F.3d 222, 228 (2d Cir.2008) (emphasis in original)). However, “‘[e]ven if
the privilege holder does not attempt to make use of the privileged information[,]... the privilege
[may be waived] if [the privilege holder] makes factual assertions the truth of which can only be
assessed by examination of the privileged communication.’” Pall Corp., 268 F.R.D. 168–69.
“On the other hand, the fact that a privileged communication may simply be relevant to a claim
or defense is insufficient to effect forfeiture of the privilege.” Chen-Oster v. Goldman, Sachs &
Co., 293 F.R.D. 547, 556 (S.D.N.Y. 2013).
Therefore, in order to determine whether 6340 NB has impliedly waived privilege, it is
necessary for the Court to review 6340 NB’s claims for anticipatory repudiation and breach of
contract and whether 6340 NB relies on the Walsh/Schaefer documents as an element of those
claims.
6340 NB alleges that on January 31, 2020, approximately 7 months before its zoning
deadline under the Ground Lease, Capital One wrongfully terminated and anticipatorily
repudiated the Ground Lease, in writing, based allegedly on 6340 NB's purported failure to
timely satisfy its "acquisition and rezoning obligations." (DE 42 at ¶¶ 31-33.) Following its
receipt of the Termination Notice, 6340 NB attempted on two occasions to convince Capital One
to withdraw the Termination Notice. (Id. at ¶¶ 35-39.) Specifically, on February 17, 2020, 6340
NB wrote to Capital One's counsel, stating:

13

" ... With the termination, your client Capital One has unequivocally shown it
intends to breach the lease Second Amendment. We are ready willing and able
to proceed but to do so require that Capital One withdraw the termination. If
Capital One does not withdraw the termination on or before February 21, 2020,
we will have no choice but to deem Capital One in breach and seek all remedies
available .... "
(Id. at ¶ 38) (emphasis added). According to 6340 NB, despite these requests, Capital One
refused to withdraw the Termination Notice, rescind its wrongful repudiation, and perform its
contractual obligations including by cooperating with 6340 NB to obtain the zoning approval as
required by the Ground Lease. (See id.) Capital One has asserted counterclaims alleging that it
was well within its rights to terminate the Ground Lease because it was 6340 NB who did not
comply with its obligations under the Ground Lease. (See DE 89.)
“Anticipatory repudiation occurs when, before the time for performance has arisen, a
party to a contract declares his intention not to fulfill a contractual duty.” Lucente v. Int'l Bus.
Machines Corp., 310 F.3d 243, 258 (2d Cir. 2002). When confronted with an anticipatory
repudiation, the non-repudiating party has two options: (1) treat the repudiation as an
anticipatory breach and seek damages for breach of contract, thereby terminating the contractual
relation between the parties; or (2) treat the contract as valid and await the designated time for
performance before bringing suit. Id. However, to succeed on a claim for anticipatory
repudiation, a plaintiff must also show that he was ready, willing and able to perform his own
obligations but for the repudiation. Towers Charter & Marine Corp. v. Cadillac Ins. Co., 894
F.2d 516, 523 (2d Cir. 1990); Vision Ent. Worldwide, LLC v. Mary Jane Prods., Inc., No. 13
CIV. 4215 AT, 2014 WL 5369776, at *5 (S.D.N.Y. Oct. 17, 2014) (“If [the non-repudiating
party] elects to terminate the contract and sue for breach, he is excused from tendering his own
performance; he need only show that [he] was ready, willing and able to perform”).

14

6340 NB contends that the attorney-client privilege here has not been waived “because
allegations that 6340 NB was ready, willing, and able to obtain zoning approval do not constitute
a waiver of the privilege.” (DE 100-2.) In order to succeed on its affirmative claims, 6340 NB
will have to demonstrate that it was, in fact, ready willing and able to perform its obligations
under the Ground Lease, but for Capital One’s alleged repudiation. 6340 NB asserts that it does
not rely on, or intend to use, privilege communications with Walsh or Schaefer to prove its
allegations and further introduced the idea during oral argument that perhaps an exception to this
rule applies and 6340 NB may not have to establish it was ready, willing, and able at all. When
questioned on how 6340 NB intends to show it was ready, willing, and able to obtain zoning
approval, 6340 NB stated it was likely it would use Walsh as a witness to testify to these facts.
Capital One argues it is entitled to know the contents of the Walsh/Schaefer emails in order to
determine if 6340 NB was, in fact, ready willing and able to perform.
Here, Capital One has not sufficiently established that 6340 NB has put the advice of
Walsh at issue such that it waives the attorney-client privilege. Insofar as Capital One contends
that what was said in the Walsh/Schaefer emails may be relevant to 6340 NB’s claims and
Capital One’s defenses, relevance is insufficient to effect forfeiture of the privilege. See ChenOster, 293 F.R.D. at 556. To meet its burden, Capital One needed to establish that 6340 NB put
Walsh and Schaefer’s advice at issue, and it simply has not done so here. See In re Grand Jury
Proc., 219 F.3d 175, 182–83 (2d Cir. 2000) (“The quintessential example is the defendant who
asserts an advice-of-counsel defense and is thereby deemed to have waived his privilege with
respect to the advice that he received”).

15

C. Do the Walsh/Schaefer Emails Serve a Legal or Business Purpose?
Capital One further argues that “most of the materials and communications at issue” are
not privileged in any event because Walsh and Schaefer were hired for a business purpose and
thus their communications are factual and not legal in nature. (DE 94.) To this end, Capital One
requests that in the event the Court determines the Walsh/Schaefer Emails are privileged, it
should conduct an in camera review of the emails “to determine which documents (or portions of
documents) contain legal advice and which contain only factual material and must be produced.”
(Id.)
In opposition, 6340 NB submits that this argument is at odds with Capital One’s primary
position that WMMD “represented Capital One in all aspects of the legal work being done on the
rezoning” and provided “legal advice to Capital One in ‘hundreds of communications ’” (DE
113.) 6340 NB argues the Court should summarily reject this argument as meritless. (Id.)
“It is well-established that the attorney-client privilege applies only where legal advice,
not business advice, is sought and given.” Urb. Box Off. Network, Inc. v. Interfase Managers,
L.P., No. 01 CIV. 8854 LTS/THK, 2006 WL 1004472, at *4 (S.D.N.Y. Apr. 18, 2006). In order
for a communication to be privileged, its predominant purpose must be to obtain or provide legal
advice. Koumoulis v. Indep. Fin. Mktg. Grp., Inc., 295 F.R.D. 28, 37 (E.D.N.Y. 2013), aff'd, 29
F. Supp. 3d 142 (E.D.N.Y. 2014). 9 In other words, it must involve the “interpretation and
application of legal principles to guide future conduct or to assess past conduct.” In re Cnty. of
Erie, 473 F.3d 413, 419 (2d Cir. 2007). “Attorneys frequently give to their clients business or
other advice which, at least insofar as it can be separated from their essentially professional legal

The Court notes that the Supreme Court recently granted certiorari in In re Grand Jury, No. 21-1397, __
U.S. __ (Oct. 3, 2022) which will consider the appropriate standard to apply in assessing privilege
assertions when the communications are “dual-purpose” involving both legal and business advice.
9

16

services, gives rise to no privilege whatever.” Koumoulis, 295 F.R.D. at 37 (quoting Colton v.
United States, 306 F.2d 633, 638 (2d Cir.1962)). “Thus, when an attorney is used as a business
consultant, the resulting attorney-client communications will not be privileged.” Id. The
communication need not specifically ask for legal advice, but the information must be sent to
counsel in order for counsel to provide legal advice. Urb. Box Off. Network, Inc., 2006 WL
1004472, at *4. The burden is on the party asserting the privilege and any ambiguities are
construed against that party. Koumoulis, 295 F.R.D. at 38.
6340 NB’s privilege log identifies that the withheld emails are “[c]onfidential
communications from counsel to representatives of 6340 providing legal advice and requesting
information in connection with representation involving development and zoning issues
pertaining to proposed for Capital One Bank branch.” (DE 94-2.) Indeed, Capital One argues
that WMMD provided it with legal advice, thus purportedly giving Capital One reason to believe
WMMD represented it, on the very same issues. It was undisputed during argument that a
zoning or land use attorney’s work and advice during a transaction such as this has a
predominantly legal purpose. Conclusory allegations, without more, that the Walsh/Schafer
emails contain communications for a business purpose, rather than legal advice is insufficient.

17

CONCLUSION
For the foregoing reasons, Capital One’s motion to compel documents (DE 94) is hereby
DENIED.
Dated: Central Islip, New York
November 18, 2022

S O

O R D E R E D:

James M. Wicks

/S/

JAMES M. WICKS
United States Magistrate Judge

18