A. Relevant Facts

*1 Plaintiff's complaint in this matter asserts several claims including breach of fiduciary duty, minority shareholder oppression, breach of contract, and civil conspiracy. Very generally, these claims arise from a termination of an employment relationship between plaintiff and defendant Superior Controls, Inc. (SCI) and the valuation of the stock in SCI that plaintiff held at the time of the termination of his employment. The specific controversy relates to whether funds in the so-called RedViking account at the end of 2011 should be included in the valuation of the stock at that time. Plaintiff was contractually entitled to a certain percentage of the value of the company stock on termination of the employment relationship.

Defendants have denied responsibility for these claims and, as part of their defense, the individual defendants have asserted the affirmative defense of best business judgment, including the specific assertion that they have sought the advice of auditors and legal counsel in exercising that judgment. (Dkt. 21, Pg ID 127). As part of the disclosures made by defendants in this case, a memorandum dated July 11, 2012, authored by counsel for defendant, and an opinion letter dated December 4, 2012, also authored by counsel for defendant, were turned over to plaintiff. Both of these communications related to the valuation of the corporation at the point in time that the value of plaintiff's stock in the corporation was to be determined and both suggested that an earlier valuation of the stock should be modified. The financial statements were subsequently restated by the accountant following the opinion letter of defendants' counsel.

B. Discovery Request

The discovery in this case has been contentious for a number of reasons. The particular discovery request that is the subject of this motion is a request for documents and communications related to the July 11, 2012, and December 4, 2012, documents that defendants turned over to plaintiff. These requests were contained in the first set of discovery requests and subpoenas that were served on December 16, 2013, and March 14, 2014. (Dkt. 93, Pg ID 1938). Certain responses to those discovery requests were withheld on the basis of attorney-client privilege or work product protection.

C. Position of the Parties

Plaintiff contends that by submitting these opinions of counsel, the July 11, 2012, and December 4, 2012, communications, which were arguably protected by the attorney-client privilege or the work product doctrine, defendants have waived protection for the subject matter of the communications. Additionally, plaintiff contends that communications between defendants and counsel for defendants regarding the restatement of defendants' financial status are relevant to their claims and the documents are needed in order for plaintiff to prosecute those claims and that fairness requires that these documents be produced by defendants or their counsel.

Defendants argue that the voluntary disclosure of documents containing the legal opinion of its counsel does not effect a waiver of otherwise privileged communications and that the legal opinion of counsel, and any communications between defendants and counsel relating to that opinion, are not relevant because the propriety of the restatement of defendant's financials is a matter for the court to determine based on the accounting principles about which both sides have expert witnesses prepared to testify.

D. Analysis and Conclusions

*2 This particular controversy has to be resolved in the context of the claims and defenses raised by the parties. Plaintiff has made claims against defendants that include breach of fiduciary duty, minority shareholder oppression, breach of contract, and conspiracy. (Dkt. 1). Defendants have defended these claims by, in part, asserting that they have relied on the advice of professionals, including auditors and legal counsel, in exercising their best business judgment.

As a general proposition, a federal court applies state law principles to questions involving privilege issues in diversity cases, such as the present one, and federal law principles to questions involving work product doctrine issues. In re Powerhouse Licensing, 441 F.3d 467, 472 (6th Cir. 2006). However, Federal Rule of Evidence 502 now provides guidance on when there is a waiver of either the attorney-client privilege or work-product protection through disclosure. Rule 502 controls even where “state law provides the rule of decision” pursuant to Rule 501. Fed.R.Evid. 502(f). “Under [Rule 502] in a federal proceeding—although state law still applies to the existence of a privilege in a diversity case—federal law (as stated in the Rule) controls waiver.” Lee v. Medical Protective Co., 858 F.Supp.2d 803, 807 (E.D. Ky. 2012), citing Fed.R.Evid. 502(f).

The Advisory Committee Notes to Rule 502 provide that the “rule governs only certain waivers by disclosure. Other common-law waiver doctrines may result in a finding of waiver even where there is no disclosure of privileged information or work product.” The Notes further provide “that a voluntary disclosure in a federal proceeding ..., if a waiver, generally results in a waiver only of the communication or information disclosed; a subject matter waiver (of either privilege or work product) is reserved for those unusual situations in which fairness requires a further disclosure of related, protected information, in order to prevent a selective and misleading presentation of evidence to the disadvantage of the adversary.”

With respect to documents that might be protected by the work-product doctrine, federal procedural rules govern in diversity cases. In re Professionals Direct Ins. Co., 578 F.3d 432, 438 (6th Cir. 2009). Rule 26(b)(3) is the source of the work product doctrine. That rule provides that “[o]rdinarily, a party may not discover documents and tangible things that are prepared in anticipation of litigation or for trial by or for another party or its representative (including the other party's attorney, consultant, surety, indemnitor, insurer, or agent).” The rule creates exceptions to its “ordinary” application where the “documents and tangible things” are both “discoverable under Rule 26(b)(1)” and the requesting “party 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)(i) and (ii). Neither side to this lawsuit challenges whether certain documents are actually covered by the work-product doctrine so it will be assumed that the documents in question are covered by work-product protection.

One category of these “documents and tangible things” is identified for purposes of establishing a different rule for discovery of those items. Documents that contain “the mental impressions, conclusions, opinions, or legal theories of a party's attorney or other representative concerning the litigation” must be “protected.” Fed.R.Civ.P. 26(b)(3)(B). This category of documents is beyond the reach of the requesting party even if the requesting party is able to show it has substantial need for the documents and undue hardship in obtaining them by other means. In re Columbia/HCA Healthcare Corp. Billing Practices Litigation, 293 F.3d 289, 294 (6th Cir. 2002).

*3 Rather than seeking to obtain responsive documents under the substantial need/undue hardship route under Rule 26, plaintiff seeks to obtain responsive documents under the provisions of Federal Rule of Evidence 502. Rule 502 applies to the “disclosure of a communication or information covered by the attorney-client privilege or work-product protection.” Rule 502(a) provides that “[w]hen the disclosure is made in a federal proceeding ... and [the disclosure] waives the attorney-client privilege or work-product protection, the waiver extends to an undisclosed communication or information in a federal or state proceeding only if:

The Advisory Committee Notes (Revised 11/28/2007) to Rule 502 indicate “the subject matter waiver is limited to situations in which a party intentionally puts protected information into the litigation in a selective, misleading and unfair manner.” While documents containing the mental impressions of counsel are not discoverable under the substantial need/undue hardship standard of Rule 26(b)(3)(A), that limitation does not apply to subject matter waiver under Rule 502(a).

Plaintiff also cites the case of New Phoenix Sunrise Corp. v. Comm. of Internal Revenue, 408 Fed.Appx. 908 (6th Cir. 2010) in support of his position on this issue. In New Phoenix, the Court of Appeals found subject matter waiver appropriate under Rule 502(a) where plaintiff raised “a reasonable cause defense premised on a claim of reasonable reliance on [their attorney's] tax opinion.” Id. at 919. The facts of New Phoenix are very similar to those of the present case in that defendants here are relying on the affirmative defense of the advice of professionals, including auditors and legal counsel, in exercising their best business judgment. While the wording used differs slightly, the gist of the defenses are the same in both cases.

In response to this argument, defendants do not address the applicability of Rule 502(a) at all. Rather, the entire argument of defendants consists of a challenge to the relevancy of these communications. Defendants contend that any communications to and from counsel relating to the restatement of financials are not relevant because that legal opinion regarding the restatement does not matter. Defendants acknowledge that the propriety of the restatement is a critical issue in this litigation, but argue that is a matter to be decided based on expert accounting opinion rather than on the prior legal opinion of defendants' counsel.

Plaintiff's reply brief points out that the intent of defendants in seeking to have the financials restated is relevant to the “non-valuation” claims and therefore these communications have potential significance beyond merely the propriety of the restatement from an accounting perspective. The complaint clearly includes claims such as breach of fiduciary duty, minority stockholder oppression, and conspiracy that involve the intent of the defendants. Defendants' relevancy argument is not persuasive because it overlooks the other claims plaintiff has made that relate to intent and motive, not just the efficacy of the accounting decision.

Based on this record, the undersigned finds that defendants intentionally waived work-product protection relating to the subject matter of the restatement of financials by disclosing the opinions of their counsel in 2012 on that topic. The waiver extends to undisclosed documents that concern the restatement of financials that would evidence the intent and motive of defendants in seeking the restatement. These documents “ought in fairness to be considered together” with the disclosed documents because they would place the opinions of counsel in the context of what defendants intended by seeking the restatement of those financial statements and perhaps explain their motive in doing so. This subject matter waiver results from defendants' assertion of their affirmative defense of best business judgment/advice of counsel and would protect against the “selective, misleading and unfair” consideration of that defense without the related documents. The reasonableness of defendants' affirmative defense can more fairly be evaluated by the trier of fact with the more fully developed explanation as to how that restatement came to be.

*4 In giving additional thought to the scope of the waiver, the undersigned recognizes that the court has discretion that must be exercised. “The Sixth Circuit has noted that the phrase ‘same subject matter’ for purposes of Rule 502 can be defined narrowly or broadly and approves ‘the line of cases that try to make prudential distinctions between what was revealed and what remains privileged.’ ” Yarberry v. Gregg Appliances, Inc. 2013 WL 4476681, *3 (S.D. Ohio), quoting from In re Grand Jury Proceedings Oct. 12, 1995, 78 F.3d 251, 255-56 (6th Cir. 1996). In this case the opinions of counsel (McGowan) were disclosed in furtherance of defendants' affirmative defense. What is important for purposes of plaintiff's ability to pursue his claims in light of that affirmative defense is what motivated defendants and what was their intent in seeking restatement. Therefore, the documents that defendants must produce, based on this subject matter waiver, include communications between defendants and attorney McGowan, or other members of his firm, regarding the restatement of the financials. Based on the allegations here, the communications should be those that were made between the time that defendants learned of the funds in the RedViking account and the date on which the restatement was made, prompted by the opinions of attorney McGowan.

As noted above, Rule 502(a) applies to attorney-client privilege waiver issues regardless of whether the privilege arises under state law, as it does here. Fed.R.Evid. 502(f). Lee v. Medical Protective Co., supra. Relying on the same Rule 502(a) analysis regarding the work-product doctrine, it is determined that the attorney-client privilege has been waived in this case to the same extent as indicated for the work-product doctrine. The opinions of counsel were disclosed intentionally by defendants. Those opinions relate to defendants' affirmative defense of best business judgment/advice of counsel and the undisclosed communications between defendants and counsel relating to the subject matter of the opinions of counsel regarding the restatement of financials should, in fairness, be considered with the opinions of counsel in order to prevent a selective and misleading presentation of the evidence.

While the above Rule 502(a) analysis results in a finding that defendants have waived attorney-client privilege and work-product protection regarding certain documents and communications, Rule 502 was not intended to cover all privilege waiver situations and additional “common-law waiver doctrines may result in a finding of waiver.” Advisory Committee Notes to Rule 502. Plaintiff argues that defendants have waived any attorney client privilege with respect to the subject matter of the two documents that were voluntarily turned over, the two memos by counsel relating to the valuation of the company stock. Plaintiff relies substantially on Howe v. Detroit Free Press, Inc., 440 Mich. 203 (1992) in support of his argument. For the sake of completeness, plaintiff's argument regarding privilege waiver under Michigan common-law will be addressed herein.

In Howe, the Free Press published an article in which it was stated that Virgil Howe had a serious drinking problem. Mr. Howe sued the Free Press and others for defamation. As part of their defense, the defendants in the case sought to obtain information from the presentence report in a criminal prosecution of Mr. Howe for a drinking-related traffic offense and plaintiff objected, claiming a statutory privilege relating to presentence reports protected the information from being released to the public. The Michigan Supreme Court, after considering options, adopted a balancing test for determining whether plaintiff had waived the privilege claim by filing the lawsuit against the defendants. The balancing test adopted by the Michigan Supreme Court came from Newburyport Clamshell Alliance v. Public Service Co. Of New Hampshire, 838 F.2d 13 (1st Cir. 1988). In essence, that balancing test applied the following principles: (1) the court should apply a presumption in favor of preserving the privilege; (2) the requesting party has the burden of establishing waiver; (3) the requesting party must show that its position is “enmeshed in important evidence that will be unavailable to [it] if the privilege prevails;” and, (4) the importance of the privilege is outweighed by the requesting party's need for the information. Additionally, if waiver is found, it “should be narrowly limited to those portions of the privileged material that bear directly on the issues at hand.” Id. at 221-25.

*5 In response to all the claims of plaintiff, the individual defendants have asserted a “best business judgment” defense that is based, in part, on the advice of legal counsel. Plaintiff contends that communications that relate to the advice of legal counsel, specifically the two memos of counsel relating to the restatement of defendant's financials, “could provide important context regarding the propriety of SCI's conduct and ultimately its defenses” and “may evidence minority shareholder oppression, as well as a flagrant attempt to manipulate SCI finances in order to dodge SCI's payment obligations under Plaintiff's shareholder agreement.” (Dkt. 93, Pg ID 1957).

As to the issue of waiver under Howe, there must be some conduct on the party asserting the privilege that allows for the conclusion that the party has directly or indirectly waived the privilege.

Howe, 440 Mich. at 214-15, quoting from 8 Wigmore, Evidence (McNaughton rev.), § 2388(3), p. 855.

Defendants have not expressed, in these circumstances, a “ ‘plain intention’ ” to waive the attorney client privilege. The question then becomes whether defendants, the parties claiming the privilege, have engaged in such conduct that it “ ‘would be unfair and inconsistent to permit the retention of the privilege.’ ” In other words, is the party claiming the privilege attempting to use certain information as a “sword” and at the same time seeking to shield that information through the assertion of the privilege. In Howe, the plaintiff brought a defamation suit against a newspaper and attempted, through the assertion of a statutory privilege, to prevent the newspaper from obtaining information in a presentence report involving plaintiff. It was the initiation of the suit in Howe that became the “sword” regarding the plaintiff's conduct that the court ultimately found made it unfair, under the balancing test adopted by the court, to permit plaintiff to assert a privilege regarding information relevant to defendant's defenses. Thus, plaintiff was deemed to have waived the privilege by initiating the suit.

In the present case, it is defendants that have asserted the privilege relating to information contained in communications between defendants and counsel regarding the restatement of its financial circumstances. While defendants filed a counterclaim in this case, it would not appear that any of the claims in the counterclaim implicate, in any direct way, the issue of the motivation of defendants in attempting to restate its financial status. If waiver is to be found, it must be found elsewhere.

Defendants have not effectuated a Howe waiver simply by providing plaintiff with a copy of a legal opinion of its counsel. Otherwise, as defendants contend, a waiver would be effectuated whenever legal counsel rendered a legal opinion on any topic and the attorney-client privilege would be very different than it is presently applied. However, here, defendants have asserted an affirmative defense involving defendants' reliance on the advice of counsel in exercising their best business judgment. In this way, the opinions of counsel have become a “sword” and it would be “unfair and inconsistent to permit the retention of the privilege” under these circumstances.

As noted above, defendants contend that these circumstances are no different than the garden-variety situation in which an attorney expresses an opinion about some relevant issue and, under those circumstances, no waiver should be found or else there would be a waiver anytime an attorney rendered a legal opinion. However, these circumstances are not that garden variety situation in that defendants are relying on what is essentially an advice of counsel defense and that defense changes the landscape dramatically. Defendants acknowledge the Howe balancing test in responding to plaintiff's motion to compel but simply argue, in conclusory terms, that plaintiff has not met his burden to show waiver. Defendants have waived the attorney-client privilege regarding the circumstances in which it sought to restate its financial status regarding the funds in the RedViking account.

*6 Plaintiff contends that defendants were “actively trying to cheat Plaintiff out of the value of his shares, ... that Defendants took intentional actions in order [to] substantially interfere with Plaintiff's rights as a shareholder, ... [and that] the intent and motivation of Defendants and Mr. McGowan ... are crucial to Plaintiff's non-valuation claims.” (Dkt. 114, Pg ID 2773). The complaint in this matter alleges that the individual defendants engaged in “illegal, fraudulent, or willfully unfair and oppressive” conduct with respect to intentionally “manipulating the Company's financial statements, including improperly designating and restating case assets, in an effort minimize the Company's Net Book Value prior to the Company's purchase of Plaintiff's shares.” (Dkt. 1, Pg ID 22).

Plaintiff's argument focuses on his need for the information, which is a critical issue, but spends little time addressing the other side of the balancing test-the importance of the privilege. Howe, after all, rejected an automatic waiver rule in favor of a flexible rule that requires a court to weigh “the interests involved, balancing the importance of the privilege asserted against the defending party's need for the information to construct its most effective defense.” Howe, 440 Mich. at 222. The court in Howe was dealing with a statutory privilege that protected the communication between the probation officer and the accused in the presentencing phase of a criminal case. In order to assess the importance of the privilege in relation to the need of the defendant, the court concluded there was “no rational reason to believe that the Legislature intended that the statute be used in the present manner—as an offensive weapon to block access to information relevant and vital to the just determination of issues in an unrelated civil case.” Id. at 226.

The privilege at issue here is the attorney client privilege. “The attorney-client privilege is the oldest of the privileges for confidential communications known to the common law. ... Its purpose is to encourage full and frank communication between attorneys and their clients and thereby promote broader public interests in the observance of law and administration of justice.” Upjohn Company v. United States, 449 U.S. 383, 389 (1981). That being said, the attorney-client privilege “does not protect communications made for the purpose of perpetrating a fraud.” Fassihi v. Sommers, Schwartz, Silver, Schwartz & Tyler, PC, 107 Mich.App. 509, 519 (1981).

Defendants attempt to distinguish two cases that plaintiff cites in support of his position. In Scheurer Hospital v. Lancaster Pollard & Co., 2012 WL 5471135 (E.D. Mich. 2012), the plaintiff sued a financial advisor and others for malpractice in recommending that plaintiff enter into a business arrangement with a non-party. Based on the advice of the financial advisor, plaintiff entered into the business relationship which went bad and ended up in plaintiff paying over $500,000 to settle the case. A defendant in the malpractice case sought to obtain privileged communications between plaintiff and another law firm regarding the settlement of the prior case against plaintiff and plaintiff objected. The court, applying Michigan law, concluded that plaintiff had waived the attorney client privilege regarding those communications by applying the balancing test from Howe and finding that the communications with prior counsel were important to defendant's defense of the malpractice case and that the importance of the privilege was not significant under these circumstances. Defendants' attempt to distinguish Scheurer from the present case is not persuasive. There, as here, the party claiming waiver of the attorney-client privilege demonstrated that the subject matter of the privileged communications was significant to its position in the litigation and argued that the privilege was not particularly important in that context. Defendants' argument that the present case involves only the conduct of a third party accountant, not the defendants, fails to recognize that plaintiff has asserted claims against defendants involving their conduct in seeking to have the financials restated, regardless of the propriety of the actual restatement. These are the claims of breach of fiduciary duty, minority share holder oppression, and conspiracy and implicate questions of defendants' intent. In the present case, defendants have defended against the claims of plaintiff by contending that they relied on the advice of counsel to demonstrate their good faith. While the facts in Scheurer are different than those in the present case, there are similarities in the legal issues that were before the court there with those here. Both cases involve a party seeking attorney-client communications that might be relevant to the party's position where the relevancy arises out of the affirmative contentions of the opposite party. In Scheurer, the plaintiff accused the defendants of negligence and the defendants sought to obtain statements plaintiff might have made in a separate lawsuit involving essentially the same conduct. In the present case, defendants have responded to plaintiff's claims by asserting they made proper business decisions, with the advise of counsel, and therefore did not seek to personally injure plaintiff in the course of making those decisions. Plaintiff seeks to discover what defendants might have told counsel, and what counsel might have told defendants, regarding the restatement of financials in order to gather evidence of defendants' intent and respond to defendants' affirmative defense. Both of the cases involve the attorney-client privilege and are based on the Michigan law of privilege, as applied in a diversity case, and therefore the ruling in Scheurer has some precedential value. Scheurer stands for the proposition that the attorney-client privilege can be waived regarding discussions with counsel about a decision by asserting a claim regarding the propriety of that decision.

*7 The second case that defendants attempt to distinguish from the present case is In Re Perrigo Co., 128 F.3d 430 (6th Cir. 1997). Plaintiff had cited this case for the relatively broad proposition that “under Michigan law, general notions of fairness are central to resolving whether a party has impliedly waived privilege protection.” Id. at 442. This quote is actually found in the dissenting opinion in Perrigo, but is deemed to be an accurate statement of the applicable law and defendants do not contend otherwise. Perrigo involved a situation where the plaintiff filed a shareholder derivative action against present and former directors, officers, and controlling shareholders and the defendants defended the lawsuit by claiming that there had been a good faith determination by the corporation, after a reasonable investigation, and the case should be dismissed. The defendants, while relying on the report of the investigation as a basis for the dismissal, had declined to produce the report to plaintiffs based on attorney-client privilege and work product protection. The district court had ordered that the report be produced, finding, ultimately, that the plaintiffs had established a substantial need for the report and undue hardship if it was not provided. The district court had withdrawn an earlier ruling in which it had found that defendants had waived attorney-client privilege and work product protection by moving to dismiss based on the report from counsel. The Court of Appeals, with a dissenting opinion, affirmed the decision of the district court requiring the production of the report based on the determination that plaintiffs had shown “substantial need and undue hardship” without mentioning Howe in that finding. The majority opinion did later cite to Howe in noting their disagreement with the dissent regarding whether Perrigo had “utterly waived its privilege from public disclosure under Michigan law.” Id. at 439. It did not appear that the majority relied on the balancing test in Howe in ordering the disclosure of the report and did not order the production of “documents not a part of the Report itself which may have been produced in confidence.” Id. at 441-42. Given the factual and legal differences between the present case and Perrigo, it does not appear that there is much decisional value in the Perrigo case for the present case.

Plaintiff contends that defendants have waived the attorney-client privilege regarding its restatement of financials because that subject matter and related documents are relevant to plaintiff's claims of breach of fiduciary duty and minority shareholder suppression. Defendants have defended that claim with a type of advice of counsel defense.

Based on the above, the court finds that the attorney-client privilege is presumed to apply to those communications between the named individual defendants and attorney McGowan and other attorneys in his firm, or communications made on behalf of the named individual defendants and counsel, relating to the restatement of financials that was the subject of the two memorandums by counsel referred to above. Plaintiff has asserted claims that allege conduct on the part of defendants, including fraudulent conduct, that implicate their intent and motives in undertaking certain conduct including seeking the restatement of financials that had a direct impact on the value of plaintiff's shares in the company. These are clearly allegations that go beyond the propriety of whether funds in the RedViking account at the end of 2011 should be included in the valuation of defendant's company stock.

Defendants have asserted defenses to these claims including a defense of best business judgment based on the advice of counsel. This affirmative defense, as a matter of fairness, results in a waiver of the attorney-client privilege where the plaintiff can demonstrate that the potentially available evidence is important to his claims and his position regarding defendants' affirmative defense and is not otherwise available. Also, plaintiff has to show that the value of this evidence outweighs the importance of the privilege. The court finds that the plaintiff has demonstrated that the potential evidence is significant with respect to his ability to defend against the affirmative defense raised by defendants and is not otherwise available. The court also finds that the importance of the privilege in this context must yield to the needs of the plaintiff where defendants have been accused of, among other things, fraudulent conduct and the attorney-client privilege was not intended to protect such communications. Limiting the waiver to the communications of the named individual defendants, or agents acting on their behalf, with counsel on this subject, between when the existence of the funds in the RedViking account became known to defendants and the date the decision to restate the financials was made by the accountant, confines the waiver to “those portions of the privileged material that bear directly on the issues at hand” that include the intent and motive of the individually named defendants in seeking to have the financials restated.

Documents drafted by attorney McGowan, even if they related to the restatement of financials, that were never communicated to defendants are outside the scope of this waiver under Rule 502(a) or Howe. It is the intent and motives of defendants that are critical here and documents or information never communicated to defendants would never have informed the intent and motivation of defendants. Plaintiff has attempted to cast Mr. McGowan in a role beyond that of the normal attorney-client relationship to perhaps justify plaintiff's request for the production of documents authored by Mr. McGowan but never seen by defendants. The record does not persuasively demonstrate that Mr. McGowan has crossed any line that would make his analysis and thoughts, that were never communicated to defendants, subject to discovery. In making this ruling, the undersigned seeks to “narrowly [limit discovery] to those portions of the privileged material that bear directly on the issues at hand.” Howe, 440 Mich. at 223.

*8 An additional component of this motion is whether the law firm representing defendants, Plunkett Cooney, must produce responsive documents identified in the subpoena that was served on them. Plunkett Cooney has declined to produce the documents contending that plaintiff has not met the standards of Nationwide Mut. Ins. Co. v. Home Ins. Co., 278 F.3d 621 (6th Cir. 2002). Those standards provide that discovery cannot be obtained from counsel unless: (1) there is no other means to obtain the information; (2) the information sought is relevant and nonprivileged; and (3) the information is crucial to the preparation of the case. Id. at 628.

Plaintiff maintains that it has no other means of obtaining the information due to defendants' failure to produce a comprehensive privilege log, defendants' failure to produce other documents that have been requested, and because defendants may not even be aware of some documents that would be exclusively in the possession of the law firm such as communications between the law firm and non-parties. Plaintiff also contends that the information sought, information regarding the financial restatement and the money in the RedViking account, is relevant to the litigation. Also, plaintiff argues that such information is “nonprivileged” in that any privilege or work product protection has been waived as to this universe of documents and that the information is “crucial” to plaintiff's preparation of the case.

Defendants argue that the requested information can be obtained from other sources in that the only information plaintiff should be entitled to is the information provided to the accountant regarding the restatement and that such information can be (and already has been) obtained from the accountant or from defendants. It is also defendants' position that the attorney-client communications between SCI and counsel are not relevant because they had no bearing on the decision of the accountant to restate the financials and that those communications are privileged. Defendants deny that this information is relevant to the case and therefore take the position that it is not crucial to plaintiff's preparation of the case.

As noted above, defendants have waived both attorney-client privilege and work product protection with respect to the documents and subject matter indicated in the waiver analysis. Additionally, it was determined that the indicated documents were both relevant and crucial to plaintiff's claims and defenses. The scope of this determination is somewhat narrower than that sought by plaintiff. The narrowing of the scope of waiver has implications regarding whether these documents plaintiff seeks from Plunkett Cooney are available from other sources. Limiting the scope of the documents for which waiver has been found to those documents that were communications between SCI and Plunkett Cooney regarding the restatement of financials should mean that the documents are available from SCI. However, in order to make sure all responsive documents were produced, in the view of the undersigned, a due diligence search for responsive documents would include a search of the records of Plunkett Cooney. This search is merely be an extension of the search of SCI records because copies of these communications, maintained by Plunkett Cooney, are within the possession, custody, or control of SCI. Fed.R.Civ.P. 34(a)(1). Under this view, the Nationwide requirements would not have to be met. To the extent that Nationwide is controlling, Plunkett Cooney is required to produce copies of communications between it and SCI regarding this subject matter that SCI did not have possession of because: (1) the documents would not be available anywhere else; (2) the documents are relevant and nonprivileged (based on waiver); and (3) the documents are crucial to plaintiff's claims.

*9 For these reasons, plaintiff's motion to compel is GRANTED in part as follows: Defendants must produce all communications between defendants and attorney McGowan, or other members of his firm, regarding the restatement of the financials that were made between the time that defendants learned of the funds in the RedViking account and the date on which the restatement was made, prompted by the opinions of attorney McGowan; and to the extent that such documents are in the possession, custody and control of Plunkett Cooney and not otherwise available anywhere else, Plunkett Cooney must produce such documents. And, as set forth above, defendants need not produce documents drafted by attorney McGowan or other members of his firm, even if they related to the restatement of financials, that were never communicated to defendants.

IT IS SO ORDERED.

The parties to this action may object to and seek review of this Order, but are required to file any objections within 14 days of service as provided for in Federal Rule of Civil Procedure 72(b)(2) and Local Rule 72.1(d). A party may not assign as error any defect in this Order to which timely objection was not made. Fed.R.Civ.P. 72(a). Any objections are required to specify the part of the Order to which the party objects and state the basis of the objection. Pursuant to Local Rule 72.1(d)(2), any objection must be served on this Magistrate.