In Preston Hollow Cap. LLC v. Nuveen Asset Mgmt. LLC, No. 22-MC-308 (PKC) (JLC) (S.D.N.Y. Feb. 24, 2023), New York Magistrate Judge James L. Cott, after reviewing in camera a set of exemplar documents pulled from approximately 170 emails over which a law firm asserted privilege, found that most exemplar documents withheld were not privileged and ordered the law firm to produce those exemplar documents and any that matched them.

Case Discussion

In this case in which the plaintiff alleged antitrust and tortious interference claims against the defendant, the plaintiff served non-party Bojorquez Law Firm, PC with a subpoena on January 11, 2022. The plaintiff alleged that communications between one of the firm’s lawyers, Dorothy Palumbo, and various municipal bond market participants “spread misinformation about PHC and the services it offered to potential borrowers,” and were therefore relevant to its claim that Nuveen organized a boycott of PHC among municipal bond market participants.

In response, Bojorquez produced certain documents, but withheld approximately 170 responsive emails on the basis of attorney-client privilege. On August 31, 2022, the plaintiff filed a motion in the Western District of Texas, seeking to compel Bojorquez to produce the allegedly privileged documents. It argued that some of the documents in question had already been produced to PHC by “the market participants over which Bojorquez claims privilege,” thereby undermining the assertion of privilege.

On September 28, 2022, Bojorquez filed an opposition to the plaintiff’s motion to compel. On October 27, 2022, the court in the Western District of Texas transferred the motion to the Southern District of New York Court, finding that because the enforcement of the subpoena relates to the underlying action pending in this District, “[t]he interest in having a single court decide issues related to subpoenas for discovery in this case outweighs the parties’ interest in having the issue decided in Austin,” where Bojorquez is located.

After a telephone conference Judge Cott directed the parties to meet and confer for the purpose of identifying a sampling of documents to serve as exemplars of the 170 documents being withheld for privilege and also directed counsel for Bojorquez to provide a supplemental response to explain Bojorquez’s position with regard to privilege. On December 30, 2022, Bojorquez provided 21 exemplar documents to the Court for in camera review along with a document describing the individuals identified in the communications. That same day Bojorquez filed a supplemental response to the plaintiff’s motion to compel in which it included a “counter motion” for protection, sanctions, and recovery of discovery costs.

The plaintiff filed a reply in support of its motion and in reply to Bojorquez’s supplemental response and Bojorquez filed a motion for leave to file a sur-reply.

Judge’s Ruling

Judge Cott began his analysis by stating: “the Court applies Texas law to its privilege analysis… Here, the privilege claims are governed by Texas law because Texas is the state with the most significant relationship to the communications in question.”

Regarding Bojorquez’s request to file a sur-reply, Judge Cott stated: “Here, the issue of whether PHC would be permitted to view the Table of Contents was in dispute prior to Bojorquez’s in camera submission…and prior to its submission of its proposed sur-reply. Thus, if Bojorquez wanted to address the dispute concerning PHC’s access to the Table of Contents, it had ‘ample opportunity’ to do so. Bojorquez offers no further explanation in support of its request to file a sur-reply. Accordingly, its request is denied.”

Judge Cott also noted: “While Bojorquez argues at length that the subpoena is unduly burdensome…its objections are untimely. PHC served the subpoena on January 11, 2022 and filed its motion to compel on August 31, 2022. Under Rule 45(d)(2)(B), objections to the subpoena were due within 14 days of service. Therefore, because Bojorquez did not file objections or a motion to quash within 14 days as required by the rule, it waived its right to object… Accordingly, Bojorquez’s objections to the subpoena are not only untimely, they are effectively moot given the production it has already made notwithstanding its arguments of burdensomeness.”

While finding that “Bojorquez’s contention that the parties who are identified in the communications in the sampling ‘are persons employed or otherwise affiliated with’ Bojorquez’s clients, without more, is insufficient to support the invocation of attorney-client privilege”, Judge Cott also stated: “In instances where a party has failed to justify its assertion of privilege…a court can still review the documents in question.” Of the 21 exemplar documents produced, Judge Cott found documents 2, 3, 7, 10, 11 and 17–20 to be privileged as asserted.

However, despite the presence of Bojorquez’s lawyer on the other communications, Judge Cott found most exemplar documents being withheld (specifically 1, 4–6, 8, 9, 12–16) not to be privileged, stating: “any substantive information appears to be coming not from a lawyer or client, but from one of the third parties. It is not the presence of these third parties in and of itself that breaks the privilege, but the contents of the documents, which do not appear to seek (or provide) legal advice.” He also denied Bojorquez’s remaining requests and ordered Bojorquez to produce most exemplar documents (and all matching exemplar documents).

So, what do you think? Are you surprised that the Court only directed the firm to produce most exemplar documents, given that its objections were untimely? Please share any comments you might have or if you’d like to know more about a particular topic.

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