I. FACTUAL AND PROCEDURAL BACKGROUND

The Technology Park X Limited Partnership (“Tech Park X”) is a limited partnership, created by the Tech Park X Limited Partnership Agreement (“LP Agreement”) in which the Traverses hold a 38 percent share, and defendants The Gutierrez Company (“TGC”), Arturo J. Gutierrez (“Arturo”), and Arthur J. Gutierrez (“Arthur”), among others, hold smaller stakes.[4] Amended Complaint ¶ 12. TGC serves as the General Partner of Tech Park X and is responsible for the management of Tech Park X. Id. at ¶ 22.

Tech Park X, through TGC, paid out distributions to the partnership in 2010, 2011, and 2012, some portion of which was subsequently clawed back pursuant to an agreement between the parties. Id. at ¶ 26. After 2012, Tech Park X ceased making distributions. Id.; see also Affidavit of Nassrine Traverse in Support of Motion for Protective Order or to Quash (Docket No. 42) (“Nassrine Aff.”) at ¶ 4. In light of the cessation of distributions, and on the recommendation of her attorney, Nassrine retained Feeley & Driscoll, P.C. (“F&D”)[5] to review the relevant records of the partnerships. Nassrine Aff. at ¶¶ 2, 6, 7.

Nassrine states that she was hopeful that F&D would be able to identify what happened to the cash flow so that her attorney would be able to use that information to persuade TGC to resume distributions without the need for a lawsuit. Id. at ¶ 6. She maintains that, in light of prior experiences with TGC, she thought that litigation would be necessary to resolve the parties’ dispute regarding distributions. Id. at ¶ 5. If litigation was necessary, she would use the information uncovered by F&D to educate her litigation attorney on the nature of and factual support for her claims. Id. at ¶ 6.

*2 On October 13, 2015, F&D sent an engagement letter to the Traverses. Docket No. 42-1. In the letter, F&D stated that they were providing consulting services “in anticipation of possible litigation.” Id. at 1. F&D agreed to, among other things, review and analyze existing documentation for the partnerships for the years 2011 through 2014 and year-to-date 2015, including financial statements, bank statements, cash flow documents, and tax returns. Id. at 1-2. F&D also agreed to “prepare and deliver a report setting forth the results of our procedures and our findings, together with a binder of all documents obtained from the Partnerships or their General Partner.” Id. at 3.

F&D sent the results of their work to Nassrine and her attorney, Kenneth Berman. Nassrine Aff. at ¶ 9. Based on F&D's work, Nassrine concluded that she required more information and she retained a second attorney, Jason Koral. Id. Koral was retained in August 2016 (a) to investigate and evaluate potential violations of law by the defendants with respect to the Traverses’ investments in the partnerships, and (b) if the facts so warranted, to bring claims on the Traverses’ behalf. Affidavit of Jason M. Koral in Support of Plaintiff's Motion for Protective Order or to Quash Subpoena (Docket No. 43) (“Koral Aff.”) at ¶ 3; see also Nassrine Aff. at ¶ 9. Attorney Koral recommended that Nassrine engage a forensic accountant who could advise him and help him understand the financial documents they had obtained from the partnerships. Nassrine Aff. at ¶ 10; Koral Aff. at ¶ 4.

On October 12, 2016, Koral signed an engagement letter with Stohlman. Koral Aff. at ¶ 5. The engagement letter stated that Stohlman's services would include “the specific engagements directed by you and may include investigatory accounting services, advice on the accounting aspects of litigation matters, tax considerations, valuations, attendance at depositions, hearings, trial, and other services as required.” Docket No. 43-1 at 2.

The defendants maintain that they were never advised that F&D and Stohlman had been retained to provide advice in anticipation of possible litigation. See Declaration of Kevin J. Rodenberg (Docket No. 48-1) (“Rodenberg Aff.”) at ¶ 7; Dozois Aff. at ¶¶ 5-7, 15. Rather, the defendants believed that F&D and Stohlman were conducting an annual review of the books and records of the partnerships, as was contemplated by the LP Agreement[6] and as the Traverses had done in the past. See Rodenberg Aff. at ¶¶ 5-6, 8, 15; Dozois Aff. at ¶¶ 3-7, 10, 11. During Stohlman's review of records, Kevin Rodenberg, TGC's Treasurer, spent a considerable amount of time answering their questions about specific charges and records. Rodenberg Aff. at ¶ 12. The defendants maintain that had they known that Stohlman and his colleagues were purportedly acting as agents of counsel in furtherance of possible litigation, they would have consulted with legal counsel “before engaging in open and free dialogue with them.” Id. at ¶ 16.

After consulting with Stohlman, Koral wrote a series of letters to TGC, raising issues of concern regarding Tech Park X, including alleged contractual and fiduciary breaches by the defendants. Koral Aff. at ¶ 6. Koral proposed that the parties meet to discuss the dispute and reiterated a prior proposal to enter into a tolling agreement to facilitate out-of-court discussions. Id. at ¶ 7. TGC refused to hold an in-person meeting and refused to sign a tolling agreement before the end of the 2017 calendar year. Id. at ¶ 8. Accordingly, Koral filed the instant lawsuit on the Traverse's behalf on or around December 29, 2017. Id. at ¶ 9.

*3 On or about December 21, 2018, the defendants served a subpoena on Stohlman. Docket No. 43-2. The subpoena seeks, inter alia, all work papers concerning the Traverses and the Tech Park entities, communications with the Traverses or their attorneys concerning the Traverses or the Tech Park entities, communications with TGC, and notes, memoranda, and/or opinions concerning the Tech Park entities. See Docket No. 43-2 at 10.

II. ANALYSIS

The Traverses seek an order quashing the subpoena to Stohlman on the grounds that it seeks documents protected by the work product doctrine. See Docket No. 41 at 7-11. The defendants argue that the Traverses have failed to show that the documents sought by the subpoena are protected by the work product doctrine. Docket No. 48 at 7-15. In the alternative, the defendants argue that any work product protection has been waived and/or the defendants have a substantial need for the materials. Id. at 15-16, 18-21. Finally, the defendants argue that the Traverses’ blanket claim of work product protection is inappropriate and, to the extent some of the documents may be found to be protected, the Traverses should have to produce a privilege log. Id. at 16-18.

A. The Work Product Doctrine

The work product doctrine protects (1) documents or other things, (2) prepared in anticipation of litigation, (3) by or for a party or a party's representative. Fed. R. Civ. P. 26(b)(3); Hickman v. Taylor, 329 U.S. 495 (1947). “The underlying purpose of the work product doctrine is to protect the integrity of the adversarial process by creating a zone of privacy for those matters prepared by or for the party or the party's counsel in anticipation of litigation.” Amgen, Inc. v. Hoechst Marion Roussel, Inc., 190 F.R.D. 287, 290 (D. Mass. 2000). The work product doctrine does not protect the underlying facts contained in the documents. Tyler v. Suffolk County, 256 F. R. D. 34, 38 (D. Mass. 2009); In re Grand Jury Subpoena, 220 F.R.D. 130, 141 (D. Mass. 2004).

One claiming privilege, “bears the burden of establishing that ... [the privilege] applies ... and that it has not been waived.” In re Keeper of Records (Grand Jury Subpoena Addressed to XYZ Corp.), 348 F.3d 16, 22 (1st Cir. 2003); see also Amgen, Inc. v. Hoecsht Marion Roussel, 190 F.R.D. at 289 (“The party claiming the protection of a privilege bears the burden of demonstrating, by a fair preponderance of the evidence, not only that the privilege applies, but also that it has not been waived.”). Once a party claiming privilege has carried its initial burden of establishing grounds for asserting the privilege and that the privilege has not been waived, the burden shifts to the opposing party to establish any exceptions to the privilege. Vicor Corp. v. Vigilant Ins. Co., 674 F.3d 1, 17 (1st Cir. 2012).

B. In Anticipation Of Litigation

The parties dispute whether the documents created by Stohlman were created in anticipation of litigation. In Maine v. United States Dep't of the Interior, 298 F.3d 60 (1st Cir. 2002), the First Circuit interpreted the phrase “in anticipation of litigation” as meaning “prepared or obtained because of the prospect of litigation.” Id. at 68 (emphasis in original) (quoting United States v. Adlman, 134 F.3d 1194, 1202 (2nd Cir. 1998)). Subsequently, in an en banc opinion, the First Circuit stated that it was reaffirming the Maine decision. United States v. Textron, Inc., 577 F.3d 21, 26 (1st Cir. 2009). However, instead of using the “because of” the prospect of litigation language, the First Circuit stated that documents or materials satisfy the “in anticipation of litigation” test if they were “prepared for use in litigation, whether the litigation was underway or merely anticipated.” Textron, Inc., 577 F.3d at 29 (emphasis added). Justice Torruella, in dissent, interpreted the majority's decision as abandoning the “because of” test articulated in Maine in favor of a narrower “prepared for” test. Id. at 32. Magistrate Judge Dein has also interpreted the First Circuit decision in Textron as adopting a narrower test for whether documents were prepared in anticipation of litigation. Columbia Data Prods., Inc. v. Autonomy Corp. Ltd., No. 11-12077-NMG, 2012 WL 6212898, at *12 (D. Mass. Dec. 12, 2012) (Documents or materials satisfy the “in anticipation of litigation” test if they were “prepared for use in possible litigation.”) (emphasis in original; quoting Textron, 577 F.3d at 27).

*4 In 2011, the First Circuit again used the “because of” language of the Maine decision. Miss. Pub. Employees Ret. Sys. v. Boston Sci. Corp., 649 F.3d 5, 31 n. 24 (1st Cir. 2011). Other than the Columbia Data decision, which cited the dissent in Textron as suggesting a narrower standard, courts in the First Circuit have continued to cite and apply the Maine “because of” standard. See, e.g., Portland Pipe Line Corp. v. City of S. Portland, No. 2:15-cv-00054-JAW, 2017 U.S. Dist. LEXIS 135704, at *22 (D. Me. Aug. 14, 2017); Roberts v. United States Bank Nat'l Ass'n, No. 13-11142-DPW, 2014 WL 12585793, at *5 (D. Mass. Oct. 31, 2014); Indemnity Ins. Co. v. Steve's Shop, Inc., No. 07-12230-NMG, 2010 WL 11579473, at *2 (D. Mass. Feb. 19, 2010).

In any event, it is not clear that the Textron standard would be narrower than Maine or lead to a different result in this case. The key distinction discussed in the caselaw is between documents prepared because of the prospect of litigation and “documents that are prepared in the ordinary course of business or that would have been created in essentially similar form irrespective of the litigation.” Textron, 577 F.3d at 30 (quoting Maine, 298 F.3d at 70).

Here, the Traverses engaged F&D on the recommendation of their litigation counsel to investigate their potential claims. See Nassrine Aff. at ¶ 6. F&D assisted the Traverses and their counsel in understanding Tech Park X's records and evaluating whether the Traverses may have claims against the defendants. See id. at ¶¶ 6, 9. Similarly, Stohlman was retained by the Traverses’ litigation counsel in connection with counsel's investigation of the Traverses’ potential claims. See Koral Aff. at ¶¶ 3-6. While the Traverses hoped to avoid litigation, they believed litigation was likely and the accountants’ analysis was needed in order to evaluate their potential claims. See Nassrine Aff. at ¶ 6, 14; Koral Aff. at ¶¶ 7-8. Accordingly, this Court finds that Stohlman's work and analysis were performed in anticipation of litigation.

The defendants argue that the accountants performed their work pursuant to inspection rights under the LP Agreement and not for litigation. Docket No. 48 at 10-13. In so doing, they rely on Judge Dein's decision in Columbia Data Products. Columbia Data was a suit for unpaid royalties under a copyright licensing agreement that gave the licensor contract rights to a formula-driven royalty. Columbia Data Prods., Inc., 2012 WL 6212898, at *5. The licensing agreement gave the plaintiff the right to retain an independent accounting firm to perform an audit of the licensee's books and records to verify the royalty amount due. Id. The contract specifically addressed the procedures for such audits and required the licensee “immediately” to pay the licensor the amount of any unpaid or underpaid royalties found by the auditor. Id.

Prior to filing the lawsuit, the plaintiff licensor exercised its right under the agreement to have the independent accounting firm PriceWaterhouseCoopers LLC (“PWC”) perform an audit of the defendant's books and records in order to determine the extent to which the defendants had failed to pay royalty fees. Id. at *1. While PWC was ultimately retained to provide expert testimony on behalf of the plaintiff in the lawsuit, as of the time that it agreed to perform the audit, it expressly declined to render any opinions or assurances with respect to its work, or to provide legal advice to the plaintiff. Id. at *7.

*5 Judge Dein found that the documents prepared by PWC during the audit were not prepared in anticipation of litigation and, therefore, were not work product materials. Id. at *10. Judge Dein observed that:

Id. at *13.

Columbia Data does not support the defendants’ position. While the Traverses obtained the documents used to conduct the accountant's analysis pursuant to their contractual rights, unlike Columbia Data, the accountant's work and analysis was not performed pursuant to the LP Agreement. Rather, the accountants were retained to provide confidential advice to the Traverses and their lawyers as part of their private diligence in anticipation of litigation. The defendants have not pointed to any provisions in the LP agreement requiring or providing for any audits and there is no evidence that the opinions of the accountants would create any contractual rights or obligations like the audits in Columbia Data. There is no evidence before the Court that the accountants’ work would have been generated in similar form irrespective of potential litigation.[7]

Finally, the defendants argue that the Traverses have admitted that they did not anticipate litigation until the summer of 2017, well after the accountants had completed their inspection. Docket No. 48 at 14-15. They point to the Traverses’ allegation in paragraph 60 of the Amended Complaint that “it was not until the summer of 2017 ... that Nassrine was able to ascertain the facts that form the basis for the allegations in this complaint.” Id. at 14. However, all that citation shows is that the Traverses did not have a good faith basis to file their complaint until the summer of 2017. Litigation may be a prospect or anticipated before a plaintiff has marshalled sufficient evidence to file a complaint.

*6 Accordingly, this Court finds that documents and materials prepared by Stohlman are protected by the work product doctrine.

C. The Traverse's Blanket Assertion Of Work Product Protection Is Inappropriate

As discussed above, the work product doctrine protects only documents or other things, prepared in anticipation of litigation, by or for a party or a party's representative. However, the Traverses request that the Court quash the subpoena in its entirety (with the exception of the engagement letter), even though some of the responsive documents are not work product. See Docket No. 41 at 4. For example, the subpoena appears to encompass non-privileged documents such as financial documents obtained from the partnership and the general partner, non-privileged documents regarding Tech Park X obtained from the Traverses, and communications between the accountants and the defendants. See Docket No. 43-2 at 10.[8] In addition, the Traverses argue, without development and for the first time in their reply brief, that some of the responsive documents are also protected by the attorney-client privilege. Docket No. 63 at 9. See Noonan v. Wonderland Greyhound Park Realty LLC, 723 F. Supp. 2d 298, 349 (D. Mass. 2010) (declining to consider arguments raised for first time in reply brief because the “purpose of a reply memorandum is not to file new arguments that could have been raised in a supporting memorandum.”). Accordingly, the Court declines to quash the subpoena in its entirety. Stohlman must produce non-privileged responsive documents and provide a privilege log for any documents withheld on the grounds of privilege and/or work product protection.

D. Waiver

The defendants argue that, even if the work product doctrine protects the materials created by Stohlman, the Traverses have put the withheld information “at issue” and, therefore, have waived any privilege. Docket No. 48 at 15-16. An implied waiver occurs when the party asserting the privilege places protected information at issue for personal benefit through some affirmative act, and to protect against disclosure of that information would be unfair to the opposing party. In re Keeper of the Records (Grand Jury Subpoena Addressed to XYZ Corp.), 348 F.3d 16, 24 (1st Cir. 2003). Generally, courts use a three-factor test in determining whether an at-issue waiver has occurred: (1) whether the proponent of the privilege took some affirmative step such as filing a pleading; (2) whether the affirmative act put the privileged information at issue by making it relevant to the case; and (3) whether upholding the privilege would deny the opposing party access to information vital to its case. Bacchi v. Massachusetts Mut. Life Ins. Co., 110 F. Supp. 3d 270, 276 (D. Mass. 2015) (citations omitted). This and other courts have also required that the privileged information be not only relevant, but also actually relied upon by the privilege holder to support a claim or defense in the case. See Trustees of Boston Univ. v. Everlight Electronics Co., Ltd., No. 12-cv-11935, 2014 WL 5786532, at *4-5 (D. Mass. Sept. 24, 2014) aff'd in relevant part and rev'd in part, 2015 WL 3407555 (D. Mass. May 27, 2015).

*7 The defendants argue that the Traverses put the work of Stohlman at issue by their allegations that in 2016 and 2017 (i.e., the timeframe of Stohlman's inspection), defendants “intentionally concealed their wrongdoing and obstructed plaintiffs’ legitimate efforts to obtain information,” and otherwise “obstructed and delayed Nassrine's investigation.” Docket No. 48 at 15 (quoting to Amended Complaint ¶¶ 49, 58-59). This Court disagrees. The Traverses’ allegations do not put at issue the accountants’ work and analysis; rather, they put at issue the financial documents and other information that the defendants provided to Stohlman. As discussed above, those documents and communications are not protected by the work product doctrine and should be produced to the extent that they are responsive to the subpoena. Accordingly, this Court finds that there has been no waiver in this case.

E. Substantial Need

Rule 26(b)(3) permits discovery of ordinary work product if the party seeking discovery “shows that it has substantial need for the materials to prepare its case and cannot, without undue hardship, obtain their substantial equivalent by other means.” Fed. R. Civ. P. 26(b)(3)(A)(ii). “If the court orders discovery of those materials, it must protect against disclosure of the mental impressions, conclusions, opinions, or legal theories of a party's attorney or other representative concerning the litigation.” Fed. R. Civ. P. 26(b)(3)(B).

The defendants argue that, given that accountants, not counsel, created the subpoenaed documents, those documents do not contain the impressions of counsel and, as such, would not be subject to heightened protections. Docket No. 48 at 18. Defendants are incorrect. The heightened protection for opinion work product extends not just to materials prepared by an attorney but also to materials prepared by a party's representative. See Fed. R. Civ. P. 26(b)(3)(B); Lobel v. Woodland Golf Club of Auburndale, No. CV 15-13803-FDS, 2016 WL 7410776, at *2 (D. Mass. Dec. 22, 2016) (“Opinion work product reflecting the mental impressions, conclusions, or legal theories of a party's attorney or representative receives heightened protection.”) (emphasis added).[9]

In any event, the defendants have not shown substantial need because they have failed to demonstrate that they are unable to obtain the information they seek from other means. The defendants argue that they need the accountants’ materials because the Traverses have failed to identify the specific factual bases for their allegations and have failed to produce relevant non-privileged documents. Docket No. 48 at 19. Defendants do not argue that non-privileged documents and information are unavailable; rather, that the Traverses have failed to provide that information. If defendants’ complaints are true, their first recourse should be to file an appropriate discovery motion.

The defendants also argue that they have a substantial need for the subpoenaed documents in order to support their counterclaims. Docket No. 48 at 19-20. With respect to the breach of fiduciary duty counterclaim, the defendants argue that they need to know what information the Traverses acquired about the purported discrepancies in the partnership records and when, as they must demonstrate that the Traverses acquired confidential information that vested them with fiduciary duties to the partnership that would not otherwise exist. Id. at 20. Defendants, however, do not need to invade work product protection to learn what information the Traverses acquired and when it was acquired. That information appears to come from the defendants’ own documents and from communications between the accountants and the defendants, which are not privileged. This Court has already noted that the Traverses must produce non-privileged documents in the possession of the accountants. As work product does not protect facts, the defendants may also be able to obtain that information through deposition testimony.

*8 There is also no merit to the defendants’ argument that they need the Traverses’ work product in order to prove their abuse of process counterclaim. The defendants allege that the Traverses had access to and knew information that undermines the allegations in the Amended Complaint. Id. Again, the information the Traverses obtained, as opposed to their accountants’ opinions and analyses based on that information, is not privileged and is discoverable. What the defendants appear to seek is the accountants’ opinions, which is protected even against a claim of substantial need.

III. ORDER

For the foregoing reasons, this Court grants in part and denies in part the motion. The motion is denied as moot with respect to BDO. With respect to the subpoena to Stohlman, this Court declines to quash the subpoena in its entirety. This Court finds only that documents created by Stohlman (or portions thereof) reflecting its work, opinions, and analysis are protected by the work product doctrine. This Court makes no finding regarding any claims of attorney-client privilege. Stohlman must produce non-privileged documents and provide a privilege log for any documents (or portions thereof) withheld on attorney-client privilege and/or work product protection grounds.

Judge Casper referred the motion to the undersigned on February 7, 2019. Docket No. 49.

The motion also sought a protective order as to a subpoena issued to BDO Seidman (“BDO”). BDO has represented that it has no responsive documents and, therefore, the motion is moot as to BDO. See Docket No. 48 at 2, n. 1; Docket No. 63 at 5, n. 1.

Citations to “Docket No. ___” are to documents appearing on the Court's electronic docket. They reference the docket number assigned by CM/ECF, and include pincites to the page numbers appearing in the top right corner of each page within the header appended by CM/ECF.

The Traverses are also limited partners in the Technology Park V Limited Partnership (“Tech Park V”). Declaration of Tobin R. Dozois, Controller for TGC (Docket No. 48-2) (“Dozois Aff.”) at ¶ 2.

F&D was acquired by the accounting firm BDO. Nassrine Aff. at ¶ 3.

Specifically, the LP Agreement provides, in relevant part, that “[t]he books and records of the Partnership shall be kept and maintained at the principal office of the Partnership and shall be available for examination by any Partner, or his duly authorized representatives, during regular business hours.” Dozois Aff. at ¶ 3. The Tech Park V agreement contains similar language. Id.

The defendants argue that if this Court credits the Traverses’ position that Attorney Koral directed Stohlman to gather due-diligence information from TGC employees and provide an analysis of that information, then their counsel “engaged in a brazen, multi-year violation of Rule 4.2,” which prohibits a lawyer from having ex parte communications with persons the lawyer knows to be represented by counsel. Docket No. 71 at 7. It is not clear that such a violation occurred, see generally Docket Nos. 73, 74, and that issue, of a violation itself, is not before this Court. Defendants conflate the manner by which the Traverses obtained documents from TGC as well as those documents themselves with the analysis that the accountants performed. As discussed below, the documents obtained from TGC are not work product. The work performed by the accountants, however, is work product because it was performed as part of the Traverse's due diligence in anticipation of litigation.

At oral argument, counsel for the Traverses acknowledged that there may be responsive documents that are not protected by work product and stated that it had no objection to Requests Nos. 4 and 8. However, it is likely that some of the documents responsive to other requests are also not protected by the work product doctrine. See, e.g., Request No. 9 (Docket No. 43-2 at 10) (requesting “all documents and communications concerning the TP Entities or Gutierrez.”).

While the defendants cite this case, it does not support their argument.