Verhovec v. City of Trotwood et al

Filing 76

THIRD SUPPLEMENTAL OPINION ON MOTION FOR PREJUDGMENT POSSESSION - It is respectfully recommended that the District Court overrule the Objections and hold that the Trotwood Caucus conversation remains protected by attorney-client privilege. Signed by Magistrate Judge Michael R. Merz on 4/21/2015. (kpf)(This document has been sent by regular mail to the party(ies) listed in the NEF that did not receive electronic notification.)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION AT DAYTON
EDWARD VERHOVEC,
Plaintiff,

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vs

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Case No. 3:14-cv-363

District Judge Walter Herbert Rice
Magistrate Judge Michael R. Merz

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CITY OF TROTWOOD, OHIO, et al.,

Defendants.

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THIRD SUPPLEMENTAL OPINION ON MOTION FOR
PREJUDGMENT POSSESSION

This case is before the Magistrate Judge on District Judge Rice’s Recommittal Order
(Doc. No. 71) requiring further analysis of the attorney-client privilege issues in this case in light
of Objections by Plaintiff and Third-Party Defendant Walker to the Magistrate Judge's Decision
and Order on Motions for Stay and Second Supplemental Opinion on Motion for Prejudgment
Possession (the “Decision and Order,” Doc. No. 66).
Having reviewed the Decision and Order in light of the Objections1, the Magistrate Judge
remains persuaded of the attorney-client privilege analysis in the Decision and Order. Several
additional comments may, however, be useful to the District Judge.

1

Although Plaintiff Verhovec and Third-Party Defendant Walker both filed Objections (Doc. Nos. 68 & 69), only
one substantive set of Objections is before the Court because Verhovec adopted Walker’s Objections “for the sake
of judicial economy.” (Doc. No. 68, PageID 515.)

1

The standard of review on nondispositive matters is clearly erroneous as to factual
findings or contrary to law as to legal conclusions. 28 U.S.C. § 636(b)(1)(A); Fed. R. Civ. P.
72(a); United States v. Curtis, 237 F.3d 598, 603 (6th Cir. 2001), citing United States v. Raddatz,
447 U.S. 667, 673 (1980). “Review under Rule 72(a) provides ‘considerable deference to the
determinations of magistrate judges.’ 7 Moore's Federal Practice ¶ 72.03 [7.-3]. A finding is
clearly erroneous only when the reviewing court is left with a definite and firm conviction that a
mistake has been committed. Heights Community Congress v. Hilltop Realty, Inc., 774 F.2d 135,
140 (6th Cir.1985); Shivers v. Grubbs, 747 F.Supp. 434 (S.D.Ohio 1990).” In re Search
Warrants Issued August 29, 1994, 889 F. Supp. 296, 298 (S.D. Ohio, 1995)(Holschuh, J.)
Having conducted the in camera review of the conversation at issue2, the Magistrate
Judge found as a matter of fact that the conversation did not constitute planning or carrying out a
crime or fraud:
The discussion [footnote omitted] is about defending the
Mandamus Case and what the likely next steps will be, given that
Magistrate Fuchsman turned the conference in the direction of a
negotiated settlement rather than the pending summary judgment
motion. Counsel are discussing how appropriately to deal with
Redflex, a vendor under contract, who was not a party to the
Mandamus Case but whose addition to the case had been discussed
by Magistrate Fuchsman. They were concerned about the content
and interpretation of the Redflex contract and what discovery from
Redflex might reveal. There is no suggestion in the conversation
of any intended crime or fraud.
(Decision and Order, Doc. No. 66, PageID 510.)
In light of the Objections, the Magistrate Judge has caused the discussion to be
transcribed by a registered professional court reporter and filed under seal (Doc. No. 73). Thus

2

This is the Trotwood Caucus discussion among attorneys Kevin Lantz, Steven McHugh, and Amerlia Blankenship
in the conference room of Magistrate David Fuchsman on march 23, 2012.

2

the District Judge can readily review this seven-page transcript and determine whether the
Magistrate Judge’s finding of the import of the words spoken is clearly erroneous. There would
seem to be no dispute among the parties that the interpretation of spoken words is properly
classified as a finding of fact. However, to be explicit, there is no credibility determination here:
the speakers are not testifying nor was their demeanor observed. Upon review of the certified
transcript, the District Court will find that the words purportedly quoted by Mr. Walker do not
accurately reflect the words spoken.
The Decision and Order also includes legal conclusions and the application of law to
facts as found. These two aspects of the Order are to be reviewed de novo by the District Court.
Curtis, supra; Raddatz, supra.
For the underlying law on the crime-fraud exception to protection for attorney-client
communications, the Decision and Order relies on the same law now cited3 by Walker, In Re
Antitrust Grand Jury, 805 F.2d 155 (6th Cir. 1986). The same case holds the burden of proving
the crime-fraud exception is on the party seeking to defeat the privilege. Id. at 162.
Walker argues further “[t]he Sixth Circuit uses a prima facie standard to establish the
crime-fraud exception . . .” (Doc. No. 69, PageID 523, citing In Re Antitrust Grand Jury at 164
and 166). However, the prima facie standard in that case relates to prima facie proof that a crime
was committed. Only upon receipt of that proof can a district court pierce the attorney-client
privilege. But Walker and Verhovec have offered no proof at all, much less prima facie proof of
the sort required by the Sixth Circuit, that the client, the City of Trotwood, committed any crime
or fraud. Walker and Verhovec rely entirely on the content of the privileged communication,
3

As the Decision and Order notes, Walker relied entirely on Ohio case law in initially arguing
the crime-fraud exception, but federal common law provides the privilege rule in a federal
question case (Doc. No. 66, PageID 509-10, citing Reed v. Baxter,134 F.3d 351, 355 (6th Cir.
1998); Reg’l Airport Auth. v. LPG, LLC, 460 F.3d 697 (6th Cir. 2006)).
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which they surreptitiously recorded, for proof. That is not the sort of prima facie proof of crime
or fraud In re Antitrust Grand Jury requires. Walker and Verhovec have already breached the
attorney-client privilege and seek this Court’s post hoc blessing of their conduct.
It is therefore respectfully recommended that the District Court overrule the Objections
and hold that the Trotwood Caucus conversation remains protected by attorney-client privilege.

April 21, 2015.
s/ Michael R. Merz
United States Magistrate Judge

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