Rearden LLC v. Walt Disney Co.
Rearden LLC v. Walt Disney Co.
2023 WL 5667888 (N.D. Cal. 2023)
May 16, 2023

Tigar, Jon S.,  United States District Judge

Privilege Log
Attorney-Client Privilege
Waiver
30(b)(6) corporate designee
In Camera Review
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Summary
The plaintiffs sought to reverse a magistrate judge's order denying their motion to compel the production of an email chain containing information relevant to their claims. The judge cited the common interest exception to attorney-client privilege and the court found no error in this decision. The plaintiffs' request for an in camera review of the email chain was also denied.
Additional Decisions
REARDEN LLC, et al., Plaintiffs,
v.
THE WALT DISNEY COMPANY, et al., Defendants
Case No. 17-cv-04006-JST
United States District Court, N.D. California
Filed May 16, 2023

Counsel

Mark S. Carlson, Steve W. Berman, Jerrod C. Patterson, Hagens Berman Sobol Shapiro LLP, Seattle, WA, Frank H. Busch, Wagstaffe, Von Loewenfeldt, Busch & Radwick LLP, San Francisco, CA, Gayne Kalustian-Carrier, Rio S. Pierce, Hagens Berman Sobol Shapiro LLP, Berkeley, CA, for Plaintiffs.
Kelly Max Klaus, Blanca Fromm Young, Peter A. Detre, Rohit K. Singla, Stephanie Goldfarb Herrera, Munger Tolles & Olson LLP, San Francisco, CA, Erin Joan Cox, Glenn Douglas Pomerantz, John L. Schwab, Rowley John Rice, Shannon Aminirad, Munger Tolles & Olson LLP, Los Angeles, CA, Ginger D. Anders, Pro Hac Vice, Munger Tolles & Olson LLP, Washington, DC, for Defendants The Walt Disney Company, Buena Vista Home Entertainment, Inc., Walt Disney Motion Pictures Group, Inc., Mandeville Films Inc.
Kelly Max Klaus, Blanca Fromm Young, Peter A. Detre, Rohit K. Singla, Stephanie Goldfarb Herrera, Munger Tolles & Olson LLP, San Francisco, CA, Anne K. Conley, Erin Joan Cox, Glenn Douglas Pomerantz, John L. Schwab, Rowley John Rice, Shannon Aminirad, Munger, Tolles and Olson LLP, Los Angeles, CA, Ginger D. Anders, Pro Hac Vice, Munger Tolles & Olson LLP, Washington, DC, for Defendant Marvel Studios, LLC.
Kelly Max Klaus, Blanca Fromm Young, Munger Tolles & Olson LLP, San Francisco, CA, Anne K. Conley, John L. Schwab, Rowley John Rice, Shannon Aminirad, Munger, Tolles and Olson LLP, Los Angeles, CA, for Defendants Walt Disney Pictures, MVL Productions LLC, Infinity Productions LLC, Assembled Productions II LLC.
Tigar, Jon S., United States District Judge

ORDER DENYING PLAINTIFFS' MOTION FOR RELIEF FROM NONDISPOSITIVE PRETRIAL ORDER OF MAGISTRATE JUDGE

Re: ECF No. 382

*1 Before the Court is Plaintiffs’ motion for relief from a non-dispositive pretrial order of a magistrate judge. ECF No. 382. Plaintiffs ask the Court to reverse Judge Kim's order denying Plaintiffs’ motion to compel. ECF No. 379. The Court will deny the motion.
“A non-dispositive order entered by a magistrate must be deferred to unless it is ‘clearly erroneous or contrary to law.’ ” Grimes v. City & Cnty. of San Francisco, 951 F.2d 236, 241 (9th Cir. 1991) (quoting Fed. R. Civ. P. 72(a); 28 U.S.C. § 636(b)(1)(A)). “A decision is ‘contrary to law’ if it applies an incorrect legal standard or fails to consider an element of the applicable standard.” Ingram v. Pac. Gas & Elec. Co., No. 12-cv-02777-JST, 2013 WL 6174487, at *2 (N.D. Cal. Nov. 25, 2013) (citation omitted). “The ‘clearly erroneous’ standard applies to the magistrate judge's findings of fact; legal conclusions are freely reviewable de novo to determine whether they are contrary to law.” Wolpin v. Philip Morris Inc., 189 F.R.D. 418, 422 (C.D. Cal. 1999). With respect to findings of fact, the district court “may not simply substitute its judgment” for that of the magistrate judge. Grimes, 951 F.2d at 241. Rather, “the district court may only set aside [a magistrate judge's] factual determinations if it is left with a definite and firm conviction that a mistake has been committed.” EEOC v. Peters’ Bakery, 301 F.R.D. 482, 484 (N.D. Cal. 2014) (internal quotation marks and citation omitted). This “deferential standard ... indicates that decisions by the magistrate judge on nondispositive matters are essentially final decisions of the district court which may be appealed in due course with other issues.” United States v. Abonce-Barrera, 257 F.3d 959, 968-69 (9th Cir. 2001) (internal quotation marks and citation omitted).
Plaintiffs moved to compel production of an email chain initiated by counsel for the Motion Picture Association (“MPA”) over which Disney claims attorney-client privilege. See ECF No. 375. Plaintiffs believe that the email chain contains information concerning the date on which Disney first learned of the injunction in Shenzhenshi Haitiecheng Science and Technology Co. (“SHST”), LTD. v. Rearden LLC, No. 15-cv-00797-JST, which is relevant to Plaintiffs’ claims in this case. Id. at 4. Judge Kim denied the motion, holding that the common interest exception to waiver of the attorney-client privilege applied. ECF No. 379. Judge Kim concluded that “members of the communication were joined in the common legal interest in the patent and technology issues here,” “the general counsel for the MPA sent the emails related to a recent injunction issued regarding patent and technology to in-house counsel for members of the MPA,” and “the only individuals who received the e-mail were in-house counsel for MPA member studios.” Id. at 1-2.
In their motion for relief, Plaintiffs argue that Judge Kim's holdings were based on erroneous findings of fact. ECF No. 382 at 6-8. Although Plaintiffs purport to challenge only Judge Kim's findings of fact, some of their argument is, in substance, a challenge to Judge Kim's conclusions of law. Plaintiffs argue (1) that the privilege log produced by Disney “makes no reference to ‘legal advice’ sought by any recipient,” does not “identify any common issue [sic] shared by these competitors,” and does not “mention the ‘patent and technology issues here’ that Jude [sic] Kim relied on”; (2) that “Disney initially failed to log [the email chain],” and Judge Kim erroneously excused Disney's failure to do so; (3) that “no one on the email string could share a common interest in” the SHST litigation because the recipients were not parties to the litigation; (4) that “there was no showing that Disney had an agreement with the MPA or any other studio who received the e-mail”; (5) that any privilege “was waived by disclosure to a group that included Universal, which did not use MOVA Contour”; and (6) that Judge Kim erred by declining to review the email chain in camera. ECF No. 382 at 7-8. The first argument is a challenge to findings of fact. The remaining arguments are challenges to both findings of fact and conclusions of law.
*2 As to the first argument, the record before Judge Kim established the facts that Rearden identifies as absent from the privilege log. See ECF No. 374-6 ¶¶ 4-8. Judge Kim did not clearly err in so concluding.
As to the second argument, Plaintiffs appear to contend that Disney's failure to reflect this email chain on its privilege log waived privilege because such conduct amounted to “tactical manipulation of the rules and the discovery process.” ECF No. 382 at 7 n.2 (quoting Burlington N. & Sante Fe Ry. Co. v. U.S. Dist. Ct. for Dist. of Mont., 408 F.3d 1142, 1149 (9th Cir. 2005)). In support of this contention, Plaintiffs cite their request for production of all communications “including but not limited to all legal analysis, memoranda, Communications, and related documents relating to the [SHST litigation].” ECF No. 382-1 at 3. However, Disney objected to this request precisely because “it s[ought], on its face, privileged information.” ECF No 398-6 at 14. Even if Disney failed to document the existence of the email chain in its privilege log, there is no affirmative evidence that this failure reflected tactical manipulation by Disney. To the contrary, when Disney became aware of the existence of this communication during the 30(b)(6) deposition of its corporate designee, Disney disclosed the date of the communication and added the document to its privilege log of its own accord. See ECF No. 383-2 at 22-26; ECF No. 382-4 at 8; ECF No. 389-1 ¶¶ 8, 10. Selectively quoting Federal Rule of Procedure 26, Plaintiffs further protest that Disney did not produce the information of its in-house counsel in its initial disclosures. But there is no indication in the record that Disney “may use” this information “to support its claims or defenses.” Fed. R. Civ. P. 26(1)(A). Judge Kim's implicit excusal of Disney's failure to log this email chain earlier was neither contrary to law nor clearly factually erroneous.
The third, fourth, and fifth arguments concern the common interest doctrine – “a narrow exception to the general rule that disclosing information to a third party constitutes a waiver of the attorney-client privilege.” Rodriguez v. Seabreeez v. Jetlev LLC, 620 F. Supp. 3d 1009, 1019 (N.D. Cal. 2022) (quoting Integrated Glob. Concepts, Inc. v. j2 Glob., Inc., No. 5:12-cv-03434-RMW PSG, 2014 WL 232211, at *2 (N.D. Cal. Jan. 21, 2014)). To invoke the doctrine, the party asserting privilege must show that “(1) the communication is made by separate parties in the course of a matter of common interest; (2) the communication is designed to further that effort; and (3) the privilege has not been waived.” Id. (quoting United States v. Bergonzi, 216 F.R.D. 487, 495 (N.D. Cal. 2003)). The common interest must be “legal, as opposed to commercial,” Id. (quoting Nidec Corp. v. Victor Co. of Japan, 249 F.R.D. 575, 579 (N.D. Cal. 2007)), but “a shared desire to see the same outcome in a legal matter is insufficient.” Id. (quoting In re Pac. Pictures Corp., 679 F.3d 1121, 1129 (9th Cir. 2012)). “Instead, the parties must make the communication in pursuit of a joint strategy in accordance with some form of agreement—whether written or unwritten.” Id. (quoting In re Pac. Pictures Corp., 679 F.3d at 1129). Such an agreement “may be implied from conduct and situation, such as attorneys exchanging confidential communications from clients who are or potentially may be codefendants or [who] have common interests in litigation.” Id. (quoting United States v. Gonzalez, 669 F.3d 974, 979 (9th Cir. 2012)).
*3 As to the third argument, there is simply no requirement in the case law that the recipient entities be parties to the SHST litigation for the doctrine to apply. As to the fourth argument, it is undisputed that all email recipients are members of MPA, that MPA provides legal advice to its members on patent and technology issues common to their media practices, and that the purpose of the email chain at issue was to provide and communicate regarding such advice. See ECF No. 374-6 ¶¶ 4-8. Beyond this shared legal interest, several of the non-Disney members in this email chain have, in fact, also been named as defendants in suits arising from this injunction. See Case Nos. 17-cv-04191-JST & 17-cv-04192-JST. This arrangement thus reflects a joint strategy implicit from conduct and situation. As to the fifth argument, Plaintiffs did not present their assertion that Universal Studios did not use MOVA to Judge Kim and have thus waived it. See Symantec Corp. v. Zscaler, Inc., No. 17-cv-04426-JST, 2019 WL 8331428, at *2 n.1 (N.D. Cal. Sept. 19, 2019) (“We do not believe that the Magistrates Act intended to give litigants an opportunity to run one version of their case past the magistrate, then another past the district court.” (quoting Greenhow v. Sec'y of Health & Hum. Servs., 863 F.2d 633, 638 (9th Cir. 1988), overruled on other grounds, United States v. Hardesty, 977 F.2d 1347 (9th Cir. 1992))). Regardless, such an assertion is plainly contradicted by Plaintiffs’ allegations in the operative complaint. See ECF No. 315 ¶ 71. Judge Kim did not make any clearly erroneous findings of fact or commit legal error in holding that the common interest exception applies.
As to the sixth argument, Plaintiffs have failed to identify a “factual basis sufficient to support a reasonable, good faith belief that in camera inspection may reveal evidence that information in the materials is not privileged.” Rock River Commc'ns, Inc. v. Universal Music Grp., Inc., 745 F.3d 343, 353 (9th Cir. 2014) (quoting In re Grant Jury Investigation, 974 F.3d 1068, 1075 (9th Cir. 1992)). Instead, Plaintiffs, in conclusory terms, assert that the developments precipitating the instant motion reflect an attempt by Disney to “mudd[y] the waters” around Disney's knowledge of the injunction in the SHST litigation. But Plaintiffs’ assertion overstates Disney's conduct as it appears in the record before the Court. Accordingly, Judge Kim's decision not to review the email chain in camera was not clearly erroneous.
Plaintiffs’ motion for relief from a non-dispositive pretrial order of a magistrate judge is denied. The parties’ motions to file under seal at ECF Nos. 383, 385, 388, and 392 are granted in full.
IT IS SO ORDERED.