CONNER v. ASSOCIATED RADIOLOGISTS, INC. et al
ORDER granting 1 Motion to Quash. See contents of this filing. Signed by Judge Cathy Bissoon on 2/17/2021. (scl)
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IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
TIMOTHY M. CONNER, M.D.,
ASSOCIATED RADIOLOGISTS, INC.,
Misc. No. 20-1420
Judge Cathy Bissoon
Non-party Gary J. Gunnett’s (“Mr. Gunnett,”) Motion to Quash and/or Protective Order
Pursuant to F.R.C.P. 45(d)(3) is granted (“Motion to Quash,” Doc. 1). Mr. Gunnett received a
subpoena (the “Subpoena”) from Plaintiff Dr. Timothy M. Conner (“Plaintiff” or “Dr. Conner”)
to testify at a deposition and provide documents in relation to an ERISA and employment-related
action against Defendants Associated Radiologists, Inc. (“ARI”), Dr. Conner’s former employer,
among others, pending in the United States District Court for the Southern District of Virginia.
See Motion to Quash, ¶2. Mr. Gunnett, who ARI retained for legal advice regarding a defined
benefits plan (the “DB Plan” or the “Plan”) which is part of the underlying lawsuit, contends that
the Subpoena should be quashed under Fed. R. Civ. P. 45(d)(3)(iii) because it requires disclosure
of attorney-client privileged matters, and that no relevant exception applies. Id. at ¶¶3, 13.
In response, Plaintiff urges the Court to find that he has shown good cause to preclude
Mr. Gunnett or ARI from asserting attorney-client privilege against him, a former shareholder
and director, based on law outside of Pennsylvania’s (and explicitly rejected by the state)
regarding a shareholder’s ability to access confidential communications between corporate
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counsel and the corporation.
Plaintiff Timothy A. Conner’s Response to Gary J. Gunnett’s
Motion to Quash and/or Protective Order Pursuant to F.R.C.P. 45(d)(3) (“Pl. Opp.”) at 9-11. In
the alternative, Plaintiff argues that he, as a director during the time in which Mr. Gunnett
advised ARI, was a “joint client” and thus ARI cannot assert privilege against him. Id. at 16.
Plaintiff also argues that, as a beneficiary of the DB Plan, he is entitled access to information
regarding the plan because his employer was acting as a fiduciary and prohibited from asserting
attorney-client privilege against him, as a beneficiary, on matters related to plan administration.
Id. at 17. Finally, Plaintiff argues that ARI waived attorney-client privilege regarding
termination of the DB Plan by “publishing Mr. Gunnett’s legal advice” in meeting minutes,
which were available to Plaintiff. Id. at 20. The Court will address all of those arguments in
turn, beginning with the proper law to apply.
The relevant law regarding privilege is Pennsylvania’s. 1 Contrary to Plaintiff’s claims,
under Pennsylvania’s choice of law analysis, there is no conflict of law to which this Court
should apply an interest analysis because “when a sister state’s law is unknown or unclear it is
presumed to be the same as Pennsylvania’s.” Melville v. Amer. Home. Assur. Co., 584 F.2d
1306, 1308 (3d. Cir. 1978). Plaintiff notes that while “West Virginia has not addressed [the issue
of whether ‘a shareholder of a corporation may overcome attorney-client privilege when seeking
to gain access to confidential information if the shareholder shows good cause’] yet,”
“Pennsylvania has rejected [that] line of cases.” Pl. Opp. at 10-11. Indeed, the Pennsylvania
Supreme Court found that “the Garner good cause analysis is inconsistent with the attorneyclient privilege under Pennsylvania jurisprudence because it eliminates the necessary
Mr. Gunnett does not live or work within 100 miles of the Southern District of West Virginia;
and he would comply with the subpoena by participating in the deposition in Pittsburgh,
Pennsylvania. Motion to Quash, ¶5.
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predictability of the privilege.” Pittsburgh History and Landmarks Foundation v. Ziegler, 200
A.3d 58, 80 (Pa. 2019). While this case was in the context of derivative litigation, the Court
finds that the same reasoning applies:
[W]eighing of the factors would result in current managers and the corporations’
attorneys having no meaningful of determining whether their other privileged
communications would be later divulged in…litigation discovery. As a result, corporate
management would be less willingly to discuss issues with corporate counsel, and
corporate counsel would caution corporate management not to speak with her candidly.
As a matter of simple logic, this will result in corporate managers being forced to act
without necessary legal guidance in an already complicated legal environment. We
conclude that this is inconsistent with the revered nature of the attorney-client privilege in
Pennsylvania, and the clarity of it, which has been codified by our legislature and applied
continuously by our courts.
Under Pennsylvania law, Plaintiff may not overcome the attorney-client privilege
between Mr. Gunnett and ARI based on his status as a former shareholder. 2 Nor does the Court
find Plaintiff’s arguments that he should be entitled access to these documents based on
principles of derivative litigation persuasive. The court in Ziegler clarified the limited
applicability of the ALI Principles Section 7.13, which ultimately is about “judicial procedures
for adjudicating motions to dismiss the derivative litigation following management’s decision to
adopt an independent committee’s recommendation to decline to pursue the derivative claims
demanded by plaintiffs.” 200 A.3d 58 at 76. Simply put, that situation does not apply here.
Plaintiff’s arguments under Gottlieb v. Wiles, (that a company may not assert attorneyclient privilege against a former director because he would have been able to inspect the
documents during his tenure as a director) likewise are unavailing. 143 F.R.D. 241 (D. Colo.
The Court notes that the sole case Plaintiff cites to support the notion that a corporation’s
attorney may represent the shareholder and not the company is not persuasive, given that it is out
of line with more recent cases and the common view that the entity is the client.
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1992). First, the Court notes that there is no clear authority on this point in this Circuit. Second,
Plaintiff’s cases that cite approvingly to Gottlieb, as he points out, precedes and are contrary to
the Pennsylvania Supreme Court’s decision in Ziegler. For instance, a more recent case in this
Circuit found that former directors may not waive privilege between the corporation and its
counsel. See Handy v. Delaware River Surgical Suites, LLC, 2020 WL 3549203, at *1 (E.D. Pa.
Feb. 6, 2020) (concluding that when a former director’s interests are hostile to the company’s,
the company “is the sole client that holds the attorney-client privilege” and that the former
director “may not obtain or access privileged documents or communications over the objection
of current management.”).
Next, although Plaintiff argues that ARI was acting as an ERISA fiduciary, and thus
cannot assert attorney-client privilege against him on matters of administration, given Plaintiff’s
role as a plan beneficiary, this does not apply to the process of generally amending or
terminating a plan, which is considered a “settlor” act, as opposed to a fiduciary act. The Court
is not convinced by Plaintiff’s reasoning that terminating the act in the middle of the
administration of the plan cannot be considered a “settlor” act—that would make termination
impossible as a “settlor” act because after the plan began, anything subsequent would be
considered administration of the plan, rendering the distinction of the categories moot. Mr.
Gunnett appears to have been retained for the purposes of terminating the Plan, and while he was
a consultant for when the plan began, it does not appear that he was involved in the
administration of the plan before being hired to assist with the termination process. Pl. Opp. at
Ex. H. As such, the Court does not find that Mr. Gunnett and ARI are precluded from asserting
attorney-client privilege on communications regarding the termination of the Plan.
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Additionally, the Court does not find that Mr. Gunnett or ARI waived any privilege by
making references to Mr. Gunnett’s role or making general statements regarding the potential
termination of the Plan in meeting minutes available to Plaintiff. First, as the Court has
previously noted, Pennsylvania’s law applies, and the Court of Appeals for the Third Circuit has
held that “[w]hen a party discloses a portion of otherwise privileged materials while withholding
the rest, the privilege is waived only as to those communications actually disclosed, unless a
partial waiver would be unfair to the party’s adversary.” Westinghouse Elec. Corp. v.
Republic of Philippines, 951 F.2d 1414, 1426 (3d Cir. 1991). Thus, as a matter of law, even if
some privilege was waived through these minutes, that does not result in an automatic waiver of
all privileged materials regarding Mr. Gunnett’s advice to ARI. However, the Court finds that it
does not need to conduct such an analysis, because no waiver exists in the first instance. Upon
examination of the attached minutes, the Court cannot find that any legal communications were
Insofar as Plaintiff argues that not all communications between ARI and Mr. Gunnett
were made for the purpose of obtaining legal advice, the Court cannot speculate as to the nature
of their communications and whether they were done in anticipation of litigation, or whether any
legal advice was intermingled with logistical administrative discussions. Further, to the extent
that Plaintiff argues that “ARI hired Mr. Gunnett…to help it terminate the defined benefit
Plaintiff cites to Exhibits H and I to support his argument, which include highlighted language
from board meeting minutes that the Court assumes are meant to demonstrate the
communications that have been waived. The Court cannot agree. Statements such as “[t]he
committee approves moving the funds to a money market with no risk because the distribution is
expected to be in mid to late 2019,” and “[a] motion was made and passed to vote on
Termination Scenarios at the November 2018 meeting after distributing information to all board
members and giving those who are not planning to be present at the November meeting the
option to proxy their vote,” are not legal advice. Pl. Opp., Exs. H and I.
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plan…typically an act performed by the administrator of the plan,” then he contradicts his own
previous argument that he should be entitled to “communications and materials concerning his
representation of ARI in terminating the DB plan,” because Mr. Gunnett’s actions here would be
in a settlor’s capacity, and thus an exception to the fiduciary exception. Pl. Opp. at 22, 17-18.
Finally, since Plaintiff notes that he has withdrawn his request for documents related to
legal advice provided by Mr. Gunnett on the matter of termination pay, the Court need not
further address that issue. Id. at 25.
Because Mr. Gunnett has demonstrated that the attorney-client privilege applies to the
documents and testimony he would provide, and no waiver exists, Mr. Gunnett’s Motion to
Quash (Doc. 1) is GRANTED.
IT IS SO ORDERED.
February 17, 2021
United States District Judge
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