Reliance Insurance Co., Plaintiff/Counter-Defendant, v. Keybank U.S.A., National Association, Defendant/Counter-Claimant/Third Party Plaintiff, v. Tri-Arc Financial Services, Inc., et al., Third Party Defendants CASE NO. 1:01 CV 62 United States District Court, N.D. Ohio, Eastern Division Filed June 07, 2005 Counsel Matthew W. Jorgensen, Robert D. Kehoe, Kehoe & Associates, C. Reynolds Keller, Jr., Ulmer & Berne, Kevin P. Elbert, Mazanec, Raskin & Ryder, Martin J. Murphy, Davis & Young, Cleveland, OH, Richard S. Oelsner, Stephen M. Marcellino, Wilson Elsner Moskowitz Edelman & Dicker, New York, NY, for Plaintiff/Counter-Defendant. Daniel P. Mascaro, Progressive Corporation, Mayfield Village, OH, Michelle Warner Waller, Scott C. Holbrook, Daniel R. Warren, Terry M. Brennan, Thomas R. Lucchesi, Karin M. Scholz, Louis A. Colombo, Baker & Hostetler, Cleveland, OH, Thomas D. Warren, Pierce Bainbridge, Los Angeles, CA, for Defendant/Counter-Claimant/Third Party Plaintiff. Daniel R. Warren, Terry M. Brennan, Baker & Hostetler, Cleveland, OH, for Third Party Defendants Gaughan, Patricia A., United States District Judge Order *1 INTRODUCTION This matter is before the Court upon Swiss Re’s Motion to Compel Discovery of Keybank’s Destruction of Evidence (Doc. 537). Also before the Court is Key’s Motion for Protective Order (Doc. 546). For the reasons that follow, Swiss Re’s motion is GRANTED in PART and Key’s motion is DENIED. FACTS On October 12, 2004, Key sent a letter to this Court indicating, in part, as follows, ...[W]e wish to disclose to the Court and Swiss Re that we have learned that, as a result of the routine operation of Key’s electronic information systems, emails were automatically deleted after a period of time. The issue centers on a group of employees, some of them temporary employees, who were processing information.... We do not believe that emails to and from these employees would be relevant to the amount of Key’s damages.... Nevertheless, we promptly retained the services of a forensic computer firm to assist us in recovering whatever automatically deleted emails can be recovered as quickly as possible. Not surprisingly, after Key made this disclosure Swiss Re sought discovery as to the nature and extent of the document destruction. At the same time, Key employed a forensic computer firm to assist it in attempting to recover the deleted emails and analyzing the extent of the loss. Swiss Re ultimately learned that Key’s representations to the Court were untrue. In fact, the automatic deletion of emails applied not to a “group of employees” or to any “temporary employees,” but to all non-exempt Key employees using Lotus Notes going as far back as the implementation of the email system. In addition, a large number of emails are unrecoverable. At least two Key witnesses testified without qualification that they received no instructions from anyone regarding the preservation of documents for purposes of this litigation. (Dev Dep. at 78, 83; Pykhtin Dep. at 48). At certain depositions, however, Key invoked the attorney client privilege with respect to document retention questions asked by Swiss Re. In large part, these questions addressed whether Key witnesses received instructions to preserve documents during the course of the litigation. Key also objected to document requests propounded by Swiss Re on the grounds that the requests sought information protected by the attorney client privilege and/or work product doctrine. Although Key produced some documents in response to the request, none of the documents produced address or reflect instructions given by Key to preserve evidence for purposes of this lawsuit. On December 21, 2004, Swiss Re deposed Key’s 30(b)(6) witness, Brett Young, with regard to the document destruction issue. Again, Key invoked the attorney-client privilege and allowed the witness to answer. For example, Mr. Young testified as follows, Q: Prior to October 6th, 2004, did the workplace automation technology department receive any notification or direction to preserve any documents, including e-mails, relating to the issues in dispute in this case...? *2 *** MR. WARREN: To the extent that you are able to answer that question without revealing any communication or information that you may have obtained from attorneys in this case or any communications you may have had with counsel, for which we would object on privilege and work product grounds, you may answer the question. A: We have received no such communication. It is unclear to the Court whether Mr. Young’s answers to these questions are qualified by the privilege and work product objections or whether he intended his answer to mean that he received no instructions from anyone, including attorneys. Swiss Re also complains that Key failed to properly prepare Mr. Young to testify on certain topics identified in the deposition notice. Specifically, Swiss Re argues that Mr. Young was not prepared to testify with respect to items 3, 4 and 5, which provide, 3. The manner and processes adopted by KeyBank to prevent the destruction of records since the start of the arbitration proceedings against Reliance Insurance Company until the present, including but not limited to: • Any policies implemented by KeyBank to prevent the destruction and ensure the preservation of electronic data; • Any notices issued by KeyBank to its employees to prevent the destruction and ensure the preservation of electronic data; • Any changes adopted by KeyBank in the manner in which electronic data are regularly maintained, filed or destroyed. 4. The time when and manner in which KeyBank first discovered the destruction of electronic data referenced in KeyBank’s Oct. 12, 2004 letter to the court, or any other discovered destruction of electronic data. 5. The nature and extent of KeyBank’s destruction of electronic data referenced in KeyBank’s Oct. 12, 2004 letter to the court, or any other discovered destruction of electronic data, including the period during which e-mails were deleted, the number of such e-mails, the individuals whose e-mails were deleted and the subject matter of the deleted emails. Although the witness provided some testimony on these issues, including the various changes in the e-mail retention policy over the years, he also expressly indicated that he was not prepared to testify to events occurring prior to October 6, 2004. (Young Dep. at 182, 188). Swiss Re moves to compel, asking this Court to order Key to produce all documents responsive to its fifteenth request for production and produce a witness competent to testify about each matter set forth in Swiss Re’s deposition notice. Swiss Re further requests that the Court enter an order “overruling” Key’s attorney-client and work product objections. Key opposes Swiss Re’s motion and moves for a protective order, which Swiss Re opposes. In its motion, Key asks that the Court enter an order requiring discovery to be conducted in a “reasonable and efficient” manner with “due regard” to assertions of the attorney client privilege and work product doctrine. Key also asks this Court to limit Swiss Re to interrogatories and questions asked at depositions of fact witnesses. *3 DISCUSSION 1. Attorney-Client Privilege and Work Product Objections Swiss Re argues that, as a result of Key’s destruction of evidence, Key cannot assert the attorney-client privilege or work product doctrine in response to any questions related to the topic of the document destruction, including the content of any instructions attorneys may have provided to Swiss Re. Swiss Re claims that courts routinely permit “unfettered” discovery into document destruction issues. Thus, Key should not be permitted to interpose objections on those grounds either at deposition or in response to discovery requests. Swiss Re also argues that its discovery requests seeking information relating to instructions about document retention are not privileged.[1] Remarkably, Key responds that Swiss Re should not be permitted to take the depositions of Key’s in-house and outside counsel. According to Key, Swiss Re cannot satisfy the test in the Sixth Circuit for allowing a party to depose an attorney. Key’s opposition is entirely misdirected in that Swiss Re has not sought the deposition of any attorney in this case. As such, the Court will not analyze this issue. Key also argues that the attorney-client privilege and work product doctrine remain in force unless Swiss Re can demonstrate a scheme to destroy documents. Because Swiss Re has failed to satisfy this standard, this Court should not preclude Key from objecting to Swiss Re’s discovery request on those grounds. “Spoliation is defined as the intentional destruction of evidence that is presumed to be unfavorable to the party responsible for its destruction.” United States v. Boxley, 373 F.3d 759, 762 (6th Cir. 2004)(citations omitted). In order to avoid the issue of spoliation, a party must suspend any routine document purging system once litigation is anticipated or commenced. Rambus, Inc. v. Infineon Tech., 222 F.R.D. 280, 288 (E.D. Va. 2004). If a party fails in this regard, it may be deemed to have waived the right to assert the attorney-client privilege or work product doctrine under the “crime/fraud” exception. Id. “A communication is excepted from the attorney-client privilege if it is undertaken for the purpose of committing a crime or fraud.[2]” State v. City of Cleveland, 700 N.E. 2d 12, (Ohio 1998). The crime/fraud exception “extends to materials or communications created in planning, or in the furtherance of, spoliation of evidence.” Rambus, 222 F.R.D. at 290. Simply demonstrating that documents were destroyed, however, is insufficient to pierce claims of privilege. Rather, in order to succeed in piercing the privilege, the movant must “make a prima facie showing that a sufficiently serious crime or fraud occurred to defeat the privilege...[and] must establish some relationship between the communication at issue and the prima facie violation.” United States v. Collis, 128 F.3d 313 (6th Cir. 1997) (quoting In re Antitrust Grand Jury, 805 F.2d 155, 164 (6th Cir. 1986)). *4 Even assuming Swiss Re met its burden with regard to the first element of the test, i.e., the existence of a sufficiently serious crime or fraud, Swiss Re fails to provide the Court with any evidence from which a determination can be made as to the second prong. Not only must Swiss Re demonstrate that a serious crime or fraud has been or will be committed, it must also demonstrate that some “relationship exists between the communications sought by [it] and the violations allegedly at issue.” Miller v. Miller, 247 B.R. 704, 711 (N.D. Ohio 2000). In the context of spoliation, that showing must include a demonstration that the spoilator “sought or used the advice of counsel or in the input of work product to further that endeavor.” Rambus, 222 F.R.D. at 290. This Court, like the court in Miller, recognizes that satisfying this prong “can create a paradox in that such a communication cannot actually be known until the attorney-client privilege is lifted.” Id. at 711-12. A party, however, may seek in camera review to determine the applicability of the crime-fraud exception. Nonetheless, some minimal showing is required before a court may even conduct such a review. “Before engaging in in camera review to determine the applicability of the crime-fraud exception, ‘the judge should require a showing of a factual basis adequate to support a good faith belief by a reasonable person, that in camera review of the materials may reveal evidence to establish the claim that the crime-fraud exception applies.’ ” United States v. Zolin, 491 U.S. 554, 572 (1989). In this case, Swiss Re offers nothing to even suggest that Key sought or used the advice of counsel to further the destruction of documents. Based on Swiss Re’s showing thus far, no reasonable person could conclude otherwise. As such, Swiss Re has failed to establish that it is entitled either to an in camera review or to pierce Key’s privileges. Swiss Re also argues that Key waived the attorney-client privilege by permitting witnesses to answer certain questions related to the document destruction. For example, Swiss Re points out that several witnesses testified without qualification that they received no instructions with regard to email preservation prior to the discovery of the destruction. According to Swiss Re, by permitting its witnesses to testify without objection, Key waived attorney-client privilege and work product objections on the entire subject of the document destruction. This Court disagrees. Simply put, the Court has reviewed the deposition testimony cited by Swiss Re and none of the answers given by the witnesses disclose anything even arguably privileged. Moreover, as Key points out, its attorneys indicated on the record during several depositions that the witness would be permitted to provide answers only if Swiss Re agreed that the answers were not to be construed as a waiver of the attorney-client privilege. Swiss Re agreed.[3] More troubling is the deposition of Monica Bailey, a Key employee. At that deposition the following exchange took place, Q: What caused you to have this new revelation in your memory? A: I had a conversation with Forrest Stanley [Key’s in-house counsel]. He said– MR. LUCCHESI: That’s enough of an answer, “I had a conversation with Forrest Stanley.” Q: What did Forrest Stanley tell you? MR. LUCCHESI: I’m going to object and I’m going to caution the witness–I’m going to let you describe the conversation that you had with Forrest to the extent that you tell [opposing counsel] what was said very narrowly on his question, okay. If you had other discussions about other aspects of the lawsuit, then I don’t want you to describe that. THE WITNESS: Okay. A: It was actually a very brief conversation where he said, “Do you remember that I–hearing that I had instructed people not to delete any e-mails and back” – I don’t remember if he even gave a date when, but he asked me if I recalled the instruction coming from him and it did refresh my memory. *** Q: [ ]Where were you when you had this conversation with Forrest Stanley? A: I believe it was here at Baker & Hostetler. Q: Who else was present? A: I don’t remember. Q: Were any Baker & Hostetler lawyers also present? A: I don’t remember. *5 Q: Have you been told anything else about instructions Forrest Stanley may or may not have given between your last deposition and this deposition by anybody? A: No, I haven’t. Q: So Mr. Stanley’s comments to you shortly after your October 6th, 2004 deposition refreshed your recollection that Forrest Stanley had made general instructions that you heard about preserving e-mails; is that right? A: That’s correct. Swiss Re claims that this testimony constitutes a waiver of the attorney-client privilege. Key does not directly respond to the waiver issue as it pertains to Ms. Bailey’s testimony. Rather, Key generally argues that no waiver occurred. Upon review of the relevant law, the Court finds that Key has waived its attorney- client privilege with respect to any instructions given by Forrest Stanley related to the preservation of email. Under Ohio law, waiver of the attorney-client privilege is a statutory issue. See State v. McDermott, 651 N.E.2d 985 (Ohio 1995). Pursuant to O.R.C. § 2317.02(A) an attorney may not testify “concerning a communication made to the attorney by a client in that relation or the attorney’s advice to a client, except that the attorney may testify by express consent of the client...and except that, if the client voluntarily testifies...the attorney may be compelled to testify on the same subject.” Thus, where a client[4] voluntarily testifies on a particular subject, “[s]uch disclosure waives any subsequent claim of privilege with regard to communications on the same subject matter.” Hollingsworth v. Time Warner Cable, 812 N.E.2d 976, 991 (Ohio Ct. App. 1st Dist. 2004)(citation omitted). The phrase “same subject matter,” however, is to be given a narrow construction. Id. 991-92 (citing Gomez v. Towne Bancorp, 2000 WL 1183024 (N.D. Ohio 2000). In this case, there can be no dispute that Ms. Bailey voluntarily testified as to conversations she had with Key’s general counsel concerning email retention. The Court finds that Key waived any attorney-client privilege in that regard. Construing the phrase “same subject” matter narrowly, the Court finds that Swiss Re is entitled to discovery with regard to instructions given by Forrest Stanley on the topic of e-mail preservation.[5] As such, to the extent Key is withholding any such documents on the basis of attorney-client privilege, those documents must be produced. In addition, Key must produce a 30(b)(6) witness prepared to testify on this subject.[6] Notably, however, Swiss Re has not sought to compel the deposition of Mr. Stanley. As such, this relief will not be ordered by the Court. 2. Scope of Key’s 30(b)(6) Depo *6 The parties also dispute whether the 30(b)(6) witness adequately testified as to each topic contained in the notice. Swiss Re points out that the witness was only prepared to testify as to the email recovery project and could not provide testimony as to what occurred in prior years. Upon review of the parties’ arguments and the deposition excerpts, the Court agrees with Swiss Re and finds that Key must produce a 30(b)(6) witness who can testify on each of the topics contained in the notice. The Court rejects Key’s argument that Swiss Re is precluded from reopening the deposition because it did not reserve that right at the initial deposition. Key moves for a protective order requesting that this Court issue an order requiring discovery to be conducted in a “reasonable and efficient” manner with “due regard” to assertions of the attorney client privilege and work product doctrine. The Court finds that these requests do not seek any specific or meaningful relief. Accordingly, Key’s request is DENIED. Moreover, Key also asks this Court to limit Swiss Re to interrogatories and questions asked at depositions of fact witnesses. In that Swiss Re is not seeking the deposition of an attorney, Key’s request for a protective order limiting this discovery to interrogatories is DENIED.[7] CONCLUSION For the foregoing reasons, Swiss Re’s motion is GRANTED in PART as set forth herein and Key’s motion is DENIED. IT IS SO ORDERED. Footnotes [1] Swiss Re cites various cases in which Courts have referred to the fact that the parties engaged in discovery with respect to document retention policies. None of those cases, however, discuss the applicability of the attorney client privilege or work product doctrine to discovery on this topic. [2] Questions regarding the existence of the attorney-client privilege are determined under state law because the claims at issue in this case arise under state law. See, e.g., Jewell v. Holzer Hosp. Found., Inc., 899 F.2d 1507 (6th Cir. 1990). In Ohio, however, courts rely favorably on federal law with regard to the issue of the crime-fraud exception. For example, in State v. City of Cleveland, the Ohio Supreme Court relied on United States v. Collis, 128 F.3d 313 (6th Cir. 1997) and various other Circuit Court cases. As such, this Court will rely on both state and federal cases addressing the crime-fraud exception. [3] Nor is the Court persuaded that Key’s October 12th letter constitutes a waiver. Swiss Re fails to point to anything contained therein which would constitute privileged material. [4] The Court notes that Ohio law suggests that, in order for a corporation to waive privilege, the witness must possess sufficient authority. Key, however, does not make this argument and, as such, the Court will not sua sponte address the issue. [5] Key states in its reply brief that “witnesses have revealed only whether they were instructed to preserve documents and nothing more” and argues that there has been no privileged material divulged. Again, Key fails to expressly address Ms. Bailey’s testimony. Regardless, if the “subject matter” of Mr. Stanley’s instructions regarding document preservation is not privileged, Key must respond to Swiss Re’s discovery requests in any event. [6] The Court notes that there are important differences between the attorney-client privilege and work product doctrine. Both sides, however, lump the two concepts together throughout their briefs. In the context of waiver, the parties rely only on privilege cases. Accordingly, the Court will not address waiver in the context of the work product doctrine. [7] The parties in this case have a well-known history of filing an excessive number of motions and rearguing issues already decided by this Court. In an effort to save the resources of the parties and this Court, the Court will not accept motions for reconsideration with respect to this order.