*1 Before the court is Plaintiff Graystone Funding Company, LLC's (Plaintiff or Graystone) Short Form Discovery Motion to Compel Production of Emails Without Reactions (Motion) (ECF 54). Network Funding L.P. (Network), Jason Gautreau (Gautreau), and Christie North's (North) (collectively Defendants) oppose the Motion (ECF 55). As part of considering the Motion, the court previously granted Plaintiff's request for an in camera review of the documents at issue and also ordered supplemental briefing “addressing the legal standard that applies, any controlling cases, and the facts and legal argument to support Plaintiff's argument that the attorney client privilege has been waived” (ECF 61), which the parties submitted (ECF 67 and 71). Pursuant to Rule 7- 1(f) of the Rules of Practice for the United States District Court for the District of Utah, the court concludes that oral argument is not necessary and will determine the Motion based on the written memoranda. After careful review of the memoranda submitted by the parties, relevant law, for the reasons discussed herein, the court DENIES the Motion.

Plaintiff filed a Complaint against Network and former Graystone executives Gautreau and North seeking monetary and punitive damages, including lost profits, stemming from a failed purchase transaction between Graystone and an unidentified mortgage company and North and Gautreau's alleged violations of non-disclosure and non-solicitation agreements as they negotiated employment with Network (ECF 2). Defendants filed counterclaims against Plaintiff for unpaid wages and losses related to the failed merger between Graystone and Network (ECF 14). The current discovery dispute stems from a series of emails between Gatreau and Network's in-house counsel Phillip Brashier (Brashier) which Defendants produced to Plaintiff as part of discovery.

In the Motion, Plaintiff requests that the court order Defendants to remove the redactions on NFLP0000797-800 (Emails)[1] because any attorney client privilege has been waived by the previous production of the unredacted Emails to Plaintiff (ECF 54). In the supplemental briefing, it is somewhat clearer that in addition to arguing waiver, Plaintiff is also contesting application of the attorney client privilege because Plaintiff alleges that Gautreau, who sent or received the Emails (which are all dated May 8, 2010), was hired by Network on May 10, 2019, and, therefore, could not be an agent of Network until his hire date (ECF 54, 67). Plaintiff also argues that the attorney client privilege was waived by inadvertent disclosure and by including Gatreau as a third party to the Emails (ECF 54). Defendants contend the Emails are privileged attorney client communications because Gatreau was operating as an agent of Network as of April of 2019, which is before the Emails were sent and that the privilege has not been waived by inadvertent disclosure.

A. The Emails are protected by the attorney client privilege.

*2 The attorney client privilege protects confidential communications by a client to an attorney made in order to obtain legal advice from the attorney in his capacity as a legal advisor.” Marten v. Yellow Freight Sys., Inc., No. 96–2013, 1998 WL 13244, at * 5 (D. Kan. Jan. 6, 1998). The privilege protects communications with in-house counsel as well as outside attorneys. Upjohn Co. v. United States, 449 U.S. 383, 390, 101 S. Ct. 677, 66 L.Ed.2d 584 (1981). The privilege, however, is to be extended no more broadly than necessary to effectuate its purpose.[2] Great Plains Mut. Ins. Co. v. Mut. Reinsurance Bureau, 150 F.R.D. 193, 196 (D.Kan.1993)).

“[A] corporation can only act through its officers, directors, agents, and employees.” Shriver v. Baskin–Robbins Ice Cream Co., Inc., 145 F.R.D. 112, 114 (D. Colo.1992). The attorney-client privilege thus applies to communications between corporate agents and counsel. See id. The attorney-client privilege can extend to communications between representatives of the client or between the client and a representative of the client “if the communication was made in confidence for the primary purpose of obtaining legal advice.” Austin v. Denver ex rel. Bd. of Water Comm'rs, 05–cv–01313–PSF–CBS, 2006 WL 1409543, at *4–5 (D. Colo. May 19, 2006).

After in camera review of the Emails, and for the purposes of determining whether the attorney-client privilege applies in this discovery dispute only, the court finds that the primary purpose of the communication in the Emails was to obtain legal advice as an agent of Network. “An agency relationship arises when one person (a principal) manifests assent to another person (an agent) that the agent shall act on the principal's behalf and subject to the principal's control, and the agent manifests assent or otherwise consents so to act.’ ” Pure Energy Club, LLC v. Williams, No. 1:10-CV-74 TS, 2011 WL 2579757, at *4 (D. Utah June 28, 2011) (internal citation omitted).

The parties’ supplemental briefings focus heavily on when Gatreau's employment with Graystone ended and when his employment with Network began. Plaintiff focuses on May 10 as the operative date and Network focuses on April 9 as determinative to whether the attorney client privilege applies. To support their contention that Gatreau was not an agent of Network at the time the Emails were exchanged, Plaintiff cites to pages 6-7 of the Defendants’ supplemental interrogatory responses (ECF 54 at 2), however, the court is not persuaded that those responses support that contention. Rather, the supplemental interrogatory response on page 6 states Plaintiff's employees (which would include Gautreau) “became affiliated with [Network] through a partnership of the two companies that was effective on or about April 8, 2019[3]” (ECF 54-2 at 6). The supplemental interrogatory then refers to bates labeled documents NFLP0001018 (ECF 54-2). NFLP0001018 indicates May 10, 2019, is the date Gautreau became the Non-Producing Branch Manager (ECF 54-3). While the document itself does not reference Network explicitly, and Network does not explicitly contend, the parties seem to concur official employment by Network of Gautreau did not start until May 10, 2019 but that Gautreau continued employment with Plaintiff through May 9, 2019 (ECF 54 at 2; ECF 67 at 1 and ECF 55 at 2). Defendants also refer the court to an email from Kipp Myers (Graystone's owner) to Gautreau on May 21, 2019, where Graystone acknowledges that as of April 9, 2019, Gautreau was not acting in capacity of Plaintiff but “acting as an employee of [Network] by recruiting, training and participating in the overall duties of a loan officer, branch manager, and EVP for [Network]” (ECF 71-1).

*3 Regardless of Gatreau's official status as a Network employee on May 10, 2019, the court finds he was working as an agent for Network at the time the Emails were exchanged. The Emails and communications between Gatreau, Brashier, and other Network Executives demonstrate that Gatreau was negotiating the potential purchase prices of Graystone's furniture, equipment, and data on behalf of Network under Network's control. This conclusion is also consistent with the May 21 email from Plaintiff, which the court acknowledges was not sent with the intent of evaluating the attorney client privilege, but nonetheless does recognize and argue that Gatreau was working as an employee/agent of Network as early as April 9, 2019 (See ECF 71-1). The court therefore finds for the purpose of evaluating the attorney client privilege, the Emails between Gatreau and Brashier are protected by the attorney client privilege.

B. The attorney client privilege has not been waived.

Plaintiff argues that even if the attorney client privilege applies to the Emails, the privilege has been waived. In their supplemental briefing, Plaintiff contends the privilege has been waived because of Defendants’ third-party and inadvertent disclosure. The court disagrees.

When a communication or document between a lawyer and client is disclosed to a third party, the applicable privilege is waived, and the communication or document is open to discovery. In re Qwest Commc'ns Int'l, Inc., 450 F.3d 1179, 1185 (10th Cir. 2006). The “presence of a third-party will not destroy the attorney-client privilege if the third-party is the attorney's or client's agent or possesses commonality of interest with the client.” Roe v. Catholic Health Initiatives Colorado, 281 F.R.D. 632, 637 (D. Colo. 2012)

In the Motion, Plaintiff alleges that Gatreau communicated with “[Network] executives Brett Snortland (EVP), Buzz Baker (Owner) and Matt Kiker (President)” whom Plaintiff refers to as Network's “Executives” (ECF 54 at 2). These Executives, along with Brashier and Gatreau were recipients of the Emails. While Plaintiff argues Gatreau's inclusion in the Emails amounts to third-party disclosure, the court disagrees. As discussed above, Gatreau was acting as Network's agent and was seeking legal advice from Brashier. Therefore, even by Plaintiff's own admission, the Executives shared a commonality of interest (negotiating the purchase of Graystone's equipment, furniture, and data) in seeking advice from Brashier. The inclusion of Gatreau and Network's Executives on the Emails did not amount to waiver based on third party disclosure.

The inadvertent disclosure of a privileged communication may constitute waiver of the privilege. Braun v. Medtronic Sofamor Danek, Inc., No. 2:10-CV-01283, 2013 WL 5563897, at *2 (D. Utah Oct. 7, 2013). Pursuant to Federal Rule of Evidence 502(b), a privilege is not waived if the document's disclosure is: (1) inadvertent; (2) if reasonable steps were taken to prevent disclosure; and (3) if reasonable steps were taken to rectify the error. See Fed R. Evid. 502(b). “ ‘Courts have not established a bright-line rule for determining whether a document was inadvertently produced; instead, courts look at the circumstances surrounding the disclosure.’ ” Id. at 2013 WL 5563897, at *3 (citing Judson Atkinson Candies, Inc. v. Latini–Hohberger Dhimantec, 529 F.3d 371, 388 (7th Cir.2008)).

Here, Defendants assert the disclosure was inadvertent and provided a sworn declaration from their previous counsel stating that the Emails were inadvertently produced in a semi-redacted form (ECF 71-3). Defendants also contend and the court agrees that reasonable efforts were taken to prevent disclosure including electronic keyword searches as well as hours of reviewing, compiling, and redacting discovery documents in this matter. Similarly, the court finds that Defendants took reasonable and timely steps to rectify the error once they became made aware of the failure to redact the privileged portion of the Emails by serving a letter upon Plaintiff asserting the privilege and demanding the Emails be returned seven days after becoming aware. In the supplemental brief, Plaintiff contends that because the Emails were “produced in a batch of 527 documents” and were “not voluminous” Defendants cannot meet their burden under Federal Rule of Evidence 502(b). However, Plaintiff failed to cite any case law or provide the court with arguments as to how or why the disclosure was unreasonable, why the steps taken to prevent disclosure were unreasonable, or why Defendants’ steps to rectify the error were insufficient. Therefore, the court finds the circumstances surrounding the disclosure of the Emails does not constitute a waiver of the attorney client privilege.

*4 For the reasons stated above the court hereby DENIES the Motion to Compel (ECF 29).

DATED this 11 December 2020.

The court notes that the documents submitted for in camera review were not labeled consistently with the bates numbers referenced in both parties’ briefings. Though Plaintiff seeks to compel the full bates range, it appears the communications starting on the bottom of NFLP0000798 through 800 are not redacted. For the purposes of this decision, “Emails” refers to the redacted portions of bates numbers NFLP0000797 and NFLP0000798, which were the two documents submitted for in camera review.

Defendants also refer the court to Utah law in arguing the attorney client privilege applies (ECF 71 at 2). However, where no conflicts exist between Utah and federal law regarding application of the attorney client privilege, federal law governs. See generally Utah R. Fed. Evid. 504; Marteen, 1998 WL 13244, at *3-4 (court finding no conflict between state and federal rules of privilege in applying federal law to discovery dispute).

The court notes the parties have been very casual in referencing dates and that some appear to be a day off but otherwise close in time to the documents at issue.