Ceglia v. Zuckerberg et al

Filing 181

REPLY/RESPONSE to re 177 Memorandum in Opposition to Motion in Opposition to Ceglia's Memorandum Regarding Authority for Privilege Claims as to Two Documents filed by Facebook, Inc., Mark Elliot Zuckerberg. (Snyder, Orin)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
-----------------------------------PAUL D. CEGLIA,
Plaintiff,
v.
MARK ELLIOT ZUCKERBERG and
FACEBOOK, INC.,
Defendants.
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Civil Action No. 1:10-cv-00569RJA

DEFENDANTS’ OPPOSITION TO CEGLIA’S MEMORANDUM REGARDING
AUTHORITY FOR PRIVILEGE CLAIMS AS TO TWO DOCUMENTS

Thomas H. Dupree, Jr.
GIBSON, DUNN & CRUTCHER LLP
1050 Connecticut Avenue, NW
Washington, DC 20036
[phone]
Terrance P. Flynn
HARRIS BEACH PLLC
726 Exchange Street
Suite 1000
Buffalo, NY 14210
[phone]
October 27, 2011

Orin Snyder
Alexander H. Southwell
GIBSON, DUNN & CRUTCHER LLP
200 Park Avenue, 47th Floor
New York, NY 10166-0193
[phone]

DEFENDANTS’ OPPOSITION TO CEGLIA’S MEMORANDUM REGARDING
AUTHORITY FOR PRIVILEGE CLAIMS AS TO TWO DOCUMENTS
Yesterday, Paul Ceglia filed a memorandum attempting to justify his assertion that two
documents submitted to this Court for in camera review are protected by the attorney-client
privilege. See Doc. No. 177. Ceglia’s attempt—unsupported by any competent evidence, let
alone a declaration from Ceglia—falls demonstrably short. These documents are not privileged.
This Court should order Ceglia to immediately produce both documents to Defendants.1
I.

Legal Framework
In this case, the Court has already correctly held that the attorney-client privilege

“requires that only confidential communications with an attorney for the purpose of seeking legal
advice or services are within its scope.” Doc. No. 107, at 2 (citing United States v. Int’l Bhd. of
Teamsters, 119 F.3d 210, 214 (2d Cir. 1997)). “The burden of establishing the existence of an
attorney-client privilege, in all of its elements, rests with the party asserting it.” Teamsters, 119
F.3d at 214; see also Priest v. Hennessy, 409 N.E.2d 983, 986 (N.Y. 1980) (“[T]he burden of
proving each element of the privilege rests upon the party asserting it.”).
A client waives the attorney-client privilege by disclosing privileged documents to third
parties. See U.S. Postal Service v. Phelps Dodge Refining Corp., 852 F. Supp. 156, 162
(E.D.N.Y. 1994) (“[T]he fact [that] the document is sent to a third party ordinarily removes the
cloak of confidentiality necessary for protection under the attorney-client privilege.”); see also
Allied Irish Banks, P.L.C. v. Bank of Am., N.A., 252 F.R.D. 163, 168 (S.D.N.Y. 2008)
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As this Court has already explained, New York’s attorney-client privilege law applies in
this case, but “federal and New York caselaw construing N.Y.C.P.L.R. 4503 (New York’s
statutory formulation of the privilege) are essentially similar,” so “the court applies federal
caselaw in this circuit.” Doc. No. 107, at 2. Defendants therefore cite both federal and New
York case law to support their contentions here.

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(“[D]isclosure of attorney-client communication to a third party or communications with an
attorney in the presence of a third party, not an agent or employee of counsel, vitiates the
confidentiality required for asserting the privilege.”) (internal quotation marks omitted); Bowne
of N.Y. City, Inc. v. AmBase Corp., 161 F.R.D. 258, 264 (S.D.N.Y. 1995) (“The attorney-client
privilege is waived if the communication is made in the presence of or later divulged to third
parties unless the third parties are the attorney’s employees or agents.”). It is “the burden of the
party asserting a privilege to establish that it has not been waived.” Allied Irish Banks, 252
F.R.D. at 169. That showing—together with the necessary predicate showing that a document is
in fact privileged—“must be based on competent evidence, usually through affidavits, deposition
testimony or other admissible evidence.” Id. “The burden cannot be met by ‘mere conclusory or
ipse dixit assertions’ in unsworn motion papers authored by attorneys.” Id. (quoting von Bulow
by Auersperg v. von Bulow, 811 F.2d 136, 147 (2d Cir. 1987)) (other internal quotation marks
omitted).
As the cases cited above discuss, a narrow exception to the rule that disclosure constitutes
waiver exists when the third party to whom the communication is disclosed is an agent of the
attorney or the client. See People v. Osorio, 75 N.Y.2d 80, 84 (N.Y. 1989). But New York law
imposes an important condition on such a third party: she must be “an agent of . . . [a] client to
facilitate communication” with the attorney. Id. (emphasis added). Only then should courts look
further to “whether the client had a reasonable expectation of confidentiality under the
circumstances” in which privileged material was disclosed to the third-party agent. Id. Ceglia
apparently agrees with this reading of the applicable case law. See Doc. No. 177, at 4 (“So, if an
agent is used to facilitate communication, the parties had every expectation that any

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communication between them and their counsel would remain confidential, and the
communications are therefore privileged.”) (emphasis added; internal quotation marks omitted).
II.

Ceglia Has Failed To Carry His Burden Of Establishing Privilege.
A straightforward application of those legal principles establishes that Ceglia has entirely

failed to justify his spurious claim of privilege with respect to either of the two files discussed in
his memorandum. Both files should be produced to Defendants.
That is particularly so in light of Ceglia’s demonstrated history of unsupported privilege
assertions, which are part of his general pattern of concealment and obfuscation. As the Court
will recall, Ceglia first claimed privilege in an August 2nd privilege log over two emails dated
March 3, 2004, from Ceglia to James Kole, Esq. Defendants challenged Ceglia’s designation in
their First Motion to Compel, see Doc. No. 99, at 13–14, and the Court summarily rejected
Ceglia’s claims of privilege in those emails, see Doc. No. 107. We now know why Ceglia made
a bogus assertion of privilege over these emails to Mr. Kole: he wanted to conceal from
Defendants and the Court the authentic StreetFax contract attached to those 2004 emails that
exposes his entire case as an outright a fraud.
Ceglia later claimed privilege in various documents listed on two additional logs (dated
August 29th and October 11th); after Defendants challenged those designations in their Third
Motion to Compel, see Doc. No. 155, Ceglia abandoned his privilege claims for all documents
listed on those logs except for the two documents addressed in his memorandum. This history of
prior unsupported privilege claims necessarily colors the continued improper privilege claims.
A.

The File Named “Lawsuit Overview.PDF”

Ceglia has not provided “competent evidence,” such as an affidavit “or other admissible
evidence,” Allied Irish Banks, 252 F.R.D. at 169, to support any contention that pages one

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through six and twenty-three through thirty of the file entitled “Lawsuit Overview.PDF”
constitute a communication between him and a lawyer made for the purpose of obtaining or
dispensing legal advice. Indeed, Ceglia does not even offer so much as a “mere conclusory or
ipse dixit assertion” in the unsworn motion papers submitted by his attorney that such was the
purpose of the withheld pages in that file. Allied Irish Banks, 252 F.R.D. at 169. Nowhere does
Ceglia state plainly that “Lawsuit Overview.PDF” was prepared for the purpose of soliciting
legal advice, nor does he confirm that it was not shared with any third parties. Of course, a
document that is not otherwise privileged does not become privileged merely because it is shared
with a lawyer. In any event, Ceglia leaves the Court to guess at the purpose for which this
document was created, the manner in which it was communicated, and all of the parties with
whom it was shared.
Ceglia’s utter failure to so establish “all of [the] elements” of the attorney-client privilege
with respect to that file doom any claim that it should be deemed protected by the privilege.
Teamsters, 119 F.3d at 214.
B.

The File Named “DSC01008.JPG”

Ceglia’s privilege claim is even more suspect with respect to the file named
“DSC01008.JPG.” As described in Ceglia’s revised privilege log, this file is a photo of a March
5, 2004 email sent by Ceglia to Jim Kole2 that was then transmitted to Ceglia as an email
attachment by Jessica Ceglia, whom Defendants understand to be Ceglia’s college-age niece.
See Doc. No. 179, Ex. B. This file is not be privileged.
2

As the Court is aware, although Mr. Kole is an attorney, he was also an initial member of
StreetFax LLC, and there is no indication that he was acting as an attorney for Ceglia. See
Southwell Decl. (Doc. No. 97), ¶ 41.

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First, if the file is in fact “an image of an email sent by Paul Ceglia to an attorney seeking
legal advice,” that necessarily means that an existing communication (or an “image” of it) was
disclosed after the fact to Jessica Ceglia, who is not a lawyer. Ceglia’s memorandum does not
state who disclosed the email to Jessica Ceglia, but the only potential disclosers are Ceglia and
Kole—and Ceglia does not even attempt to blame the disclosure on the attorney. Thus, it is
almost certain that Ceglia himself disclosed the email to Jessica Ceglia. That is precisely the
type of third-party disclosure that “removes the cloak of confidentiality necessary for protection
under the attorney-client privilege.” Phelps Dodge Refining Corp., 852 F. Supp. at 162. That
conclusion is indisputable here in light of Ceglia’s failure to provide any “competent evidence”
establishing that, as a result of his disclosing the email to Jessica Ceglia, the privilege “has not
been waived.” Allied Irish Banks, 252 F.R.D. at 169.
But Ceglia's privilege position fails for another fundamental reason. Ceglia contends that
the disclosure of his email to Jessica Ceglia did not waive any privilege over that document
based on the line of precedent holding that disclosure to an agent does not waive the attorneyclient privilege. See Doc. No. 177, at 3–4. This line of precedent has no application here.
Ceglia never once actually claims that Jessica was his agent. Carefully worded, his
memorandum claims only that “Mr. Ceglia had a reasonable expectation of privacy when
requesting that an agent send to him attachments including those that contain confidential
communication between himself and his attorney.” Id. at 4 (emphasis added; other emphasis
omitted). In addition, Ceglia’s memorandum actively undermines any plausible claim that
Jessica Ceglia was his agent. It states that “There is no evidence to suggest that Jessica Ceglia
was authorized to send this document as an attachment in that email.” Doc. No. 177, at 3. Such
unauthorized actions are by definition inconsistent with an agency relationship. This Court

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should refuse to hold that Jessica Ceglia was in fact Ceglia’s agent when he has not even asserted
that fact and when his actual assertions only disprove it.
Even assuming, however, that Ceglia actually intended to argue that Jessica Ceglia was
his agent, the line of authority he invokes still provides no claim of privilege with respect to the
Jessica Ceglia communication for a simple reason: Ceglia fails to contend—and cannot truthfully
contend—that her agency was intended “to facilitate communication” with his attorney. Osorio,
75 N.Y.2d at 84. Cases applying the agent-disclosure exception to the waiver rule demonstrate
why this critical pre-condition is required before courts will apply this exception. In Le Long v.
Siebrecht, 187 N.Y.S. 150 (N.Y. App. Div. 1921), the appellate court held that a letter to an
attorney, written by the husband of a wife who was a defendant in a lawsuit, was not covered by
the attorney-client privilege because the husband was not “the agent of his wife for the purpose
of writing the letter.” Id. at 152. “The mere fact that he was her husband is not sufficient, nor is
the fact that he acted as her agent” with respect to another issue in the case. Id. “It must be
shown that this letter was authorized by the then defendant in the action and was practically her
communication to the attorney.” Id. Similarly, the district court refused to find the existence of
an agency relationship sufficient to sustain an assertion of privilege over documents prepared by
a third party and given to a party’s attorney in Petition of Bloomfield Steamship Co., 42 F.R.D.
348 (S.D.N.Y. 1967). The court faulted the party for failing to “attempt to reveal the nature of
[the alleged agent’s] ‘agency.’ The only indication of his status is the [party’s] characterization
of him as a ‘representative of the Underwriters,’” the insurance company assisting with the
party’s defense. Id. at 350. “This characterization is an insufficient basis for barring . . . access
to [the alleged agent’s] statements on the ground of attorney-client privilege.” Id. In contrast, a
court found that the daughter of a mother who had been in a traumatic accident was the mother’s

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agent, such that the daughter’s presence during her mother’s discussions with the mother’s
attorneys did not destroy the privilege, where the case required “an aged woman . . . to recall,
and perhaps relive, what was probably the most traumatic experience of her life. Her daughter
selected the law firm to represent her, transported her to the law office, and put her sufficiently at
ease to communicate effectively with counsel.” Stroh v. Gen. Motors Corp., 623 N.Y.S. 873,
874 (N.Y. App. Div. 1995.
In this case, it is factually impossible for Jessica Ceglia to have “facilitate[d]” the email
communication in the file named “DSC01008.JPG” in the way Le Long, Petition of Bloomfield
Steamship Co., and Stroh indicate is necessary to establish an agency relationship. She
transmitted to Ceglia—not to a lawyer—a completed, existing communication written by Ceglia.
Thus, to the extent Jessica Ceglia “facilitate[d]” any “communication,” she merely transmitted
Ceglia’s own words back to him. That simply cannot constitute “facilitat[ing] communication”
between Ceglia and an attorney for purposes of seeking legal advice. Osorio, 75 N.Y.2d at 84.
Ceglia fails to describe any other way in which Jessica Ceglia’s actions were “practically”
Ceglia’s actions in communicating with an attorney, Le Long, 187 N.Y.S. at 152, or whether (or
to what extent) she helped Ceglia “select[] the law firm to represent [him]” or “put [him]
sufficiently at ease to communicate effectively with counsel,” Stroh, 623 N.Y.S. at 874. Instead,
Ceglia merely “characterize[es]” Jessica Ceglia as his “agent” for transmitting his own
completed communication to himself—an “insufficient basis” for accepting Ceglia’s bald claim
of an agency relationship sufficient to preserve any privilege. Petition of Bloomfield Steamship
Co., 42 F.R.D. at 350.
Finally, even if this Court were inclined to accept Ceglia’s unsupported characterization
of Jessica Ceglia as his agent, his privilege claim remains insufficient and should be rejected

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because he has not established the existence of such a relationship with any “competent
evidence.” Allied Irish Banks, 252 F.R.D. at 169. As noted above, Ceglia himself concedes this
lack of evidence. See Doc. No. 177, at 3 (“There is no evidence to suggest that Jessica Ceglia
was authorized to send this document as an attachment in that email.”). His admission fatally
undermines his effort to establish an agency relationship under settled case law, which confirms
the necessity of competent evidence in that calculus. See, e.g., Le Long, 187 N.Y.S. at 76–77
(rejecting a claim of privilege where the fact of an agency relationship was “not established by
the evidence”); Petition of Bloomfield Ship Co., 42 F.R.D. at 350 (rejecting a claim of privilege
where the party asserting the existence of an agency relationship never “attempt[ed] to reveal the
nature of [the alleged agent’s] ‘agency’” in its “affidavit”). Ceglia’s failure to introduce any
evidence leaves his claims resting on “‘mere conclusory or ipse dixit assertions’ in unsworn
motion papers authored by attorneys,” some of which actually undermine his claim. Allied Irish
Banks, 252 F.R.D. at 169 (quoting von Bulow, 811 F.2d at 147). That is no basis for a finding
that Ceglia has carried his burden of establishing an agency relationship with Jessica Ceglia.3

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In the event the Court holds that the file named “DSC01008.JPG” is privileged as Ceglia
contends, it should nevertheless order disclosure of the identity and email addresses of the sender
and the recipient, along with the date and time the email was sent. Such details are foundational
information that is not subject to the attorney-client privilege. See Church of Scientology v.
Cooper, 90 F.R.D. 442, 443 (S.D.N.Y. 1981) (citing Colton v. United States, 306 F.2d 633, 637
(2d Cir. 1962)).

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CONCLUSION
Ceglia has failed to carry his burden of establishing that the files “Lawsuit
Overview.PDF” and “DSC01008.JPG” are covered by the attorney-client privilege. This Court
should order Ceglia to immediately disclose these files to Defendants.
Dated:

New York, New York
October 27, 2011
Respectfully submitted,
/s/ Orin Snyder
Orin Snyder
Alexander H. Southwell
Matthew J. Benjamin
Amanda M. Aycock
GIBSON, DUNN & CRUTCHER LLP
200 Park Avenue, 47th Floor
New York, NY 10166-0193
[phone]

Thomas H. Dupree, Jr.
GIBSON, DUNN & CRUTCHER LLP
1050 Connecticut Avenue, NW
Washington, DC 20036
[phone]
Terrance P. Flynn
HARRIS BEACH PLLC
726 Exchange Street
Suite 1000
Buffalo, NY 14210
[phone]

Attorneys for Defendants Mark Zuckerberg and Facebook, Inc.

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