Caiola v. Lumber Liquidators, Inc. et al

Filing 133

MEMORANDUM OPINION and ORDER granting in part, denying in part, and deferring in part 756 MOTION by plaintiffs to compel production of documents on privilege log, defendant's opposition, and joint brief. Signed by Magistrate Judge Thomas Rawle s Jones, Jr. 12/28/2015. Associated Cases: 1:15-md-02627-AJT-TRJ, 1:15-cv-02628-AJT-TRJ, 1:15-cv-02630-AJT-TRJ, 1:15-cv-02631-AJT-TRJ, 1:15-cv-02632-AJT-TRJ, 1:15-cv-02633-AJT-TRJ, 1:15-cv-02634-AJT-TRJ, 1:15-cv-02635-AJT-TRJ, 1:15-cv-02636-AJT-T RJ, 1:15-cv-02637-AJT-TRJ, 1:15-cv-02638-AJT-TRJ, 1:15-cv-02643-AJT-TRJ, 1:15-cv-02644-AJT-TRJ, 1:15-cv-02645-AJT-TRJ, 1:15-cv-02646-AJT-TRJ, 1:15-cv-02647-AJT-TRJ, 1:15-cv-02648-AJT-TRJ, 1:15-cv-02649-AJT-TRJ, 1:15-cv-02651-AJT-TRJ, 1:15-cv-02652-AJ T-TRJ, 1:15-cv-02653-AJT-TRJ, 1:15-cv-02654-AJT-TRJ, 1:15-cv-02657-AJT-TRJ, 1:15-cv-02658-AJT-TRJ, 1:15-cv-02660-AJT-TRJ, 1:15-cv-02661-AJT-TRJ, 1:15-cv-02663-AJT-TRJ, 1:15-cv-02664-AJT-TRJ, 1:15-cv-02665-AJT-TRJ, 1:15-cv-02666-AJT-TRJ, 1:15-cv-02667 -AJT-TRJ, 1:15-cv-02668-AJT-TRJ, 1:15-cv-02670-AJT-TRJ, 1:15-cv-02671-AJT-TRJ, 1:15-cv-02673-AJT-TRJ, 1:15-cv-02674-AJT-TRJ, 1:15-cv-02675-AJT-TRJ, 1:15-cv-02676-AJT-TRJ, 1:15-cv-02679-AJT-TRJ, 1:15-cv-02681-AJT-TRJ, 1:15-cv-02682-AJT-TRJ, 1:15-cv-02 683-AJT-TRJ, 1:15-cv-02684-AJT-TRJ, 1:15-cv-02685-AJT-TRJ, 1:15-cv-02686-AJT-TRJ, 1:15-cv-02688-AJT-TRJ, 1:15-cv-02689-AJT-TRJ, 1:15-cv-02691-AJT-TRJ, 1:15-cv-02692-AJT-TRJ, 1:15-cv-02693-AJT-TRJ, 1:15-cv-02694-AJT-TRJ, 1:15-cv-02696-AJT-TRJ, 1:15-cv -02697-AJT-TRJ, 1:15-cv-02698-AJT-TRJ, 1:15-cv-02699-AJT-TRJ, 1:15-cv-02700-AJT-TRJ, 1:15-cv-02702-AJT-TRJ, 1:15-cv-02704-AJT-TRJ, 1:15-cv-02705-AJT-TRJ, 1:15-cv-02706-AJT-TRJ, 1:15-cv-02707-AJT-TRJ, 1:15-cv-02708-AJT-TRJ, 1:15-cv-02709-AJT-TRJ, 1:15 -cv-02710-AJT-TRJ, 1:15-cv-02711-AJT-TRJ, 1:15-cv-02714-AJT-TRJ, 1:15-cv-02716-AJT-TRJ, 1:15-cv-02718-AJT-TRJ, 1:15-cv-02719-AJT-TRJ, 1:15-cv-02720-AJT-TRJ, 1:15-cv-02721-AJT-TRJ, 1:15-cv-02724-AJT-TRJ, 1:15-cv-02725-AJT-TRJ, 1:15-cv-02726-AJT-TRJ, 1 :15-cv-02727-AJT-TRJ, 1:15-cv-02728-AJT-TRJ, 1:15-cv-02730-AJT-TRJ, 1:15-cv-02731-AJT-TRJ, 1:15-cv-02732-AJT-TRJ, 1:15-cv-02734-AJT-TRJ, 1:15-cv-02735-AJT-TRJ, 1:15-cv-02736-AJT-TRJ, 1:15-cv-02738-AJT-TRJ, 1:15-cv-02740-AJT-TRJ, 1:15-cv-02741-AJT-TRJ , 1:15-cv-02742-AJT-TRJ, 1:15-cv-02744-AJT-TRJ, 1:15-cv-02745-AJT-TRJ, 1:15-cv-02746-AJT-TRJ, 1:15-cv-02747-AJT-TRJ, 1:15-cv-02749-AJT-TRJ, 1:15-cv-02750-AJT-TRJ, 1:15-cv-02752-AJT-TRJ, 1:15-cv-02756-AJT-TRJ, 1:15-cv-02757-AJT-TRJ, 1:15-cv-02759-AJT-TRJ, 1:15-cv-02760-AJT-TRJ, 1:15-cv-02761-AJT-TRJ, 1:15-cv-02762-AJT-TRJ, 1:15-cv-02763-AJT-TRJ, 1:15-cv-02765-AJT-TRJ, 1:15-cv-02766-AJT-TRJ, 1:15-cv-02767-AJT-TRJ, 1:15-cv-02768-AJT-TRJ, 1:15-cv-02769-AJT-TRJ(rban, )

IN THE UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF VIRGINIA
ALEXANDRIA DIVISION
IN RE: LUMBER LIQUIDATORS
CHINESE-MANUFACTURED FLOORING
PRODUCTS MARKETING, SALES
PRACTICES AND PRODUCTS LIABILITY
LITIGATION

MDL No. l:15-md-02627 (AJT/TRJ)

This Document Relates to ALL Cases
MEMORANDUM OPINION AND ORDER
(Privilege Log Issues)
On December 18, 2015, pursuant to the court’s directive at the previous status hearing, the
parties submitted in camera a joint brief setting out their positions on defendant’s claims of
attorney-client privilege and/or work product protection for three categories of documents and ESI
otherwise responsive to plaintiffs’ requests for production.

Defendant contemporaneously

tendered in camera representative samples of each of the three categories of material.
The court treats the joint brief as plaintiffs’ motion to compel and defendant’s response in
opposition, and the Clerk will docket it accordingly. Because the brief contains material subject
to the protective order, the Clerk will file it under seal. The exhibits to the brief and the sample
material will be maintained in paper form until further order.
The present memorandum opinion and order does not contain confidential material and
will not be sealed.
This memorandum opinion and order is in the nature of a bench ruling, and will not be
published. As in a bench ruling, the authorities relied upon are established Fourth Circuit and
Virginia precedents and those cited by the party whose position the court is accepting.

Discussion and Findings
Because the representative plaintiffs pursue claims under federal law and the laws of
several states, a choice of law issue might arguably exist in application of Fed. R. Evid. 501.
The court finds resolution of the issues presently presented to be sufficiently clear that no such
issue exists.
The three categories of material in issue are documents and ESI relating to three
contractors that performed services for defendant: (1) Mercury Public Affairs, (2) Benchmark
International, and (3) Pure Air. The representative samples include materials such as
agreements, reports, and emails among various combinations of contractor personnel,
defendant’s personnel, and defendant’s attorneys.
(1) Mercury Public Affairs
Defendant hired Mercury to provide various and expanding services described in
summary as “crisis management” as the events leading to litigation unfolded. Defendant
contends that Mercury was so tightly integrated into defendant’s damage control operation that
Mercury’s personnel became “the functional equivalent of employees,” so that it meets the
standard for inclusion within the attorney-client privilege. The court agrees that Mercury’s
relationship with defendant meets that standard, so that its personnel would not be privilegenegating “outsiders,” and any communication involving Mercury that otherwise met the standard
for invocation of the privilege would qualify for non-disclosure.
However, under any applicable articulation of the privilege’s requirements, the
communication must be part of the process of seeking, developing, or conveying legal advice or
strategy. To qualify for work product protection the material must be “prepared in anticipation
of litigation or for trial.” Fed. R. Civ. P. 26(b)(3)(A). With minor exceptions, the representative
2

material relating to Mercury is not privileged, and does not qualify for work product protection,
because it has no relationship whatever to legal advice or strategy and was not prepared in
anticipation of litigation or for trial. Except occasionally with respect to CARB, and in Exhibit
13 as to another agency, the court finds that counsel engaging with Mercury personnel were
assisting defendant only in the business activity of managing a public/customer relations crisis,
with no observable interface, much less overlap, between that effort and one to plan the defense
of claims made in litigation.
The unquestioned fact that defendant expected litigation does not ipso facto render its
business activities in anticipation of litigation. The fact that defendant’s attorneys were
communicating with defendant’s “marketing team” about “crisis management” does not convert
business strategy into legal strategy or advice. Even the occasional reference to “a lawsuit,” e.g.
the comment in the penultimate sentence on Exhibit 15 (see Joint Brief at footnote 8 and related
text) is made in the business context.
There are a few communications involving Mercury that relate to possible administrative
proceedings before CARB or another agency and how to deal with that agency in that context.
When Mercury personnel participated in communication about interaction with an agency (e.g.
the redacted portion of Exhibit 5) as distinguished from public relations efforts, then that
material may be redacted or withheld. All the rest of the material tendered for review (e.g.
beginning with “Second …” in the redacted portion of Exhibit 7) relates to counsel involved in
quintessential business advice as distinguished from legal advice or strategy, and it and all
similar material must be produced.
If defendant contends that other, dissimilar material relating to Mercury’s work is
privileged or protected, defendant may log and produce it for in camera review.
3

(2) Benchmark International
Benchmark had previously been hired by defendant to conduct regular, routine testing to
monitor products’ compliance with various standards, and defendant does not claim protection
for communications and test results relating to that routine work.
Defendant then engaged Benchmark on four occasions to conduct separate, special tests
as part of defendant’s investigation of the claims that ultimately led to this and other litigation.
Defendant asserts that the results of those four groups of tests are work product, and the court
agrees. In the situation revealed by the record before the court, it is clear that these tests were
performed by Benchmark as defendant’s agent as part of preparation for litigation, and they are
work product within the ambit of Rule 26.
The test results are not opinion work product within the meaning of the rule, however.
They report facts only, and the testers’ opinions that the results are correct do not convert them
into opinion work product. Plaintiffs argue that even if these test results fall within the Rule on
initial analysis, they are still entitled to them under the substantial need exception. On this
discrete issue the court needs oral argument, which will be heard at the status hearing on January
5, 2016.
Defendant also asserts that communications between or including Benchmark personnel
and counsel and between Benchmark and defendant relating to litigation are protected by the
attorney-client privilege. The court disagrees.
The court finds that Benchmark was clearly and unambiguously defendant’s agent, rather
than counsel’s agent, at all relevant times. The facts that Benchmark was bound by a
confidentiality agreement, that it began taking instructions from counsel at some point, and that
4

counsel later wrote correspondence attempting to bring Benchmark within the privilege do not
alter Benchmark’s status as defendant’s agent rather than counsel’s.
Unlike agents of counsel representing a client, the client’s agents are generally, and
presumptively, not within the protected circle of privileged attorney-client communications.
Relatively uncommon situations such as the court has found above regarding Mercury in the
present case (had its communications related to legal instead of business matters) are exceptions
to that general rule. Benchmark, unlike Mercury, was a typical outside contractor performing
discrete tasks, reporting pre-requested facts and neither providing additional information or
advice to the client or counsel, nor needing input much less advice from them. The court finds
that defendant has not met its burden to show that communications to, from, or including
Benchmark are protected by the attorney-client privilege.
Defendant also attempts to rely on the common interest doctrine, which is inapposite to
say the least.
If the court does not require disclosure of test results because of specialized need as
discussed above, then to preserve the work product in the test results defendant may redact such
results from any communications in addition to withholding the reports. With that exception, all
communications from, to, or including Benchmark must be produced because they are not
privileged.
(3) Pure Air
Defendant hired Pure Air to provide and evaluate the home test kits that defendant
offered to concerned customers as part of its public relations effort following reports of problems
with the subject flooring. Pure Air was defendant’s agent. Its activities had nothing to do with
legal advice or strategy. The record does not reveal any basis for finding either that Pure Air’s
5

efforts have work product protection or that communications with it or including it are
privileged. The court finds that defendant has not met either of these burdens, and all such
documents and ESI must be produced.
Production of the Material
With the exceptions allowed above, defendant shall produce the representative materials
included as exhibits to the joint brief on December 31, 2015, unless it files a Rule 72 Objection
to one or more rulings in this order by December 30, 2015. If defendant files an Objection,
Judge Trenga will hear argument on it at the regular hearing on January 5, 2016, using the joint
brief and its exhibits and no additional briefing.
Additional production if any depends on those contingencies, but defendant should be
prepared for prompt production after January 5, 2016.
Claw Back Issue
With respect to the document for which defendant asserts inadvertent production, the
parties shall comply with the procedure set out in their stipulated order (no. 618), and the court
will consider any motion filed pursuant to section VI(C)(5) thereof.

On these findings and to this extent the motion is granted in part, denied in part, and
deferred in part, and it is so ORDERED.

December 28, 2015
Alexandria, Virginia

_________________/s/_____________
THOMAS RAWLES JONES, JR.
United States Magistrate Judge

6