eDiscovery Assistant

IQVIA, Inc. v. Veeva Sys. Inc.

2022 WL 22895629 (D.N.J. 2022)

September 15, 2022

Cavanaugh, Dennis, Special Master (Ret.)

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Summary

The court ruled that the attorney-client privilege does not apply to communications between a company and its in-house counsel that primarily serve a business purpose, rather than a legal one. The court also emphasized the need for individual evaluation of each communication to determine its privileged status and addressed the issue of waiver when a party uses the advice of counsel as an affirmative defense in litigation.

Additional Decisions

IQVIA, INC. and IMS SOFTWARE SERVICES, LTD, Plaintiffs/ Counterclaim Defendants,
v.
VEEVA SYSTEMS, INC., Defendant/ Counterclaim Plaintiff

Case No. 2:17-CV-00177-CCC-MF

United States District Court, D. New Jersey

Filed September 15, 2022

Cavanaugh, Dennis, Special Master (Ret.)

ORDER & OPINION OF THE SPECIAL MASTER

*1 This matter comes before the Special Master on Defendant-Counterclaim Plaintiff Veeva Systems, Inc.’s (“Veeva”) motion to compel Plaintiffs-Counterclaim Defendants IQVIA, Inc. and IMS Software Services, LTD, (collectively “IQVIA”) to produce 167[1] challenged Third-Party Access (“TPA”) policy communications which IQVIA withheld on the basis of attorney-client privilege. After considering the submissions of the parties, based upon the following, it is the opinion of the Special Master that Veeva's motion is GRANTED in part as outlined herein and in the attached Appendix.

DISCUSSION

A. Background

Since the litigants are fully familiar with the facts which form the basis of this lawsuit and of this motion, the Special Master will only briefly address the pertinent procedural and factual events.

This dispute concerns the TPA policy communications of Harvey Ashman (“Ashman”), Deputy General Counsel of IQVIA. IQVIA has withheld these communications based on attorney-client privilege. Veeva challenges IQVIA's assertion of privilege. Following the filing of this motion, IQVIA produced 104 of the challenged documents—65 in full and 39 with redactions. IQVIA maintains its original position with respect to the remaining challenged documents.

The parties both discuss the Special Master's May 13, 2019 Order and Opinion (“May 13 Opinion”),[2] which concerned Veeva's motion to overrule IQVIA's assertion of privilege over documents subpoenaed from Ernst & Young LLP (“EY”). The May 13 Opinion concerned whether IQVIA had properly asserted attorney-client privilege over documents subpoenaed from EY, which IQVIA had retained to assess Veeva's systems and processes in order to provide its professional opinions as to the assurances made by Veeva that IQVIA data would be safe in Veeva's MDM system and would not be used by Veeva to improve its own data offerings. In the May 13 Opinion, the Special Master determined that the EY audit was intended to inform IQVIA's business decision on whether or not to allow Veeva to use its reference data in Veeva's MDM offering. The Special Master found that while the licensing of this data and TPA agreements are intimately intertwined with and difficult to distinguish from the business purposes of the EY audit, the EY assessment would not have been undertaken but for IQVIA's need to make a business determination as to whether, at the request of IQVIA's clients, IQVIA would allow its clients to share certain data licensed from IQVIA with Veeva for use by Veeva in its MDM offering. The Special Mater noted that EY was engaged to evaluate Veeva's systems and processes, not IQVIA's technical information. The Special Master later clarified in his July 10 Opinion, that he considered and ruled on IQVIA's privilege assertions related to documents subpoenaed from EY and that he did not make a ruling as to any other documents. The Special Master did not consider and offered no opinion on whether the formulation of IQVIA's TPA policy, by IQVIA attorneys, served a predominately legal or business purpose.

*2 Veeva now challenges documents that it refers to as Harvey Ashman's TPA policy communications.

Arguments of the Parties

A. Veeva's Arguments

Veeva asserts that central to its antitrust case is IQVIA's TPA policy of denying customers permission to use IQVIA's data products with Veeva's software. Veeva argues that IQVIA's TPA policy impaired competition in key data markets. It then explains that IQVIA's principal antitrust defense is that its TPA policy serves a valid business justification—namely, protection of IQVIA's intellectual property—rather than anticompetitive ends.

Veeva believes IQVIA must produce the challenged documents for three reasons. First, the withheld TPA-related communications do not serve a predominately legal purpose. Second, Ashman will be IQVIA's primary trial witness on all business justification-related topics. Third, by affirmatively placing Ashman's TPA decision-making at issue, IQVIA waived the right to withhold Ashman's communications on the basis of privilege.

Veeva first argues that IQVIA's decision whether to grant a TPA is a business decision, not a legal decision. Veeva asserts that it is black letter law that “[c]ommunications which relate to business rather than legal matters do not fall within the protection of the privilege.” Leonen v. Johns-Manville, 135 F.R.D. 94, 98 (D.N.J. 1990). Veeva believes that the challenged communications—involving IQVIA's prohibition on customers’ use of IQVIA data with Veeva Network—are distinctly business in nature and not subject to valid claims of privilege for at least five reasons.

First, Veeva points to the deposition testimony of Ashman wherein he identified his TPA decisions as an example of the types of business decisions for which he is involved.

Second, Veeva points to the Special Master's July 10, 2019 Opinion wherein he stated that the decision, “whether, at the request of IQVIA's clients, IQVIA would allow its clients to share certain data licensed from IQVIA with Veeva for use by Veeva in its MDM offering” is a “business determination.” IQVIA, 2019 WL 3069186 at *3. Veeva argues that IQVIA's TPA policy is fundamentally a business initiative. Thus, related communications addressing purported IP risks would not have been undertaken but for IQVIA's need to decide whether to allow its clients to share data licensed from IQVIA with Veeva.

Third, Veeva argues that IQVIA's own privilege log entries show that the challenged communications do not discuss legal advice. Veeva argues that these communications address business strategy and public relations, which are not privileged.

Fourth, Veeva asserts that the documents produced by IQVIA show that IQVIA business leaders shaped TPA policy based upon business considerations. Veeva points to a September 25, 2014, email wherein Mike Allelunas (an IQVIA General manager and non-lawyer) stated that following direction he received from Seyed Mortazavi and Sati Sian (IQVIA non-lawyer executives) he notified a client that IQVIA reference data was not permitted in Veeva Network. Veeva also points to a November 21, 2014, email wherein Allelunas noted that after his review with two other IQVIA non-lawyers, he agreed that Veeva Network still did not provide the IP protections needed for TPA approval. Veeva further argues that IQVIA produced versions of a document it withheld which largely show it involved only non-lawyers discussing non-legal subject matter.

*3 Fifth, Veeva asserts that courts nationwide agree that data and licensing decisions, like IQVIA's TPA decisions, are predominately business in nature. See SCM Corp. v Xerox Corp., 70 F.R.D. 508 (D. Conn. 1976).

Veeva further argues that by affirmatively placing Ashman's TPA decision-making at issue, IQVIA waived the right to withhold Ashman's communications. Veeva explains that IQVIA hopes to avoid antitrust liability by asserting an affirmative defense of “business justification” for its TPA policy while simultaneously blocking discovery into Ashman's contemporaneous communications about the precise topics he will testify to support the defense. Veeva believes that the law forbids IQVIA's approach, which severely prejudices Veeva's ability to cross-examine Ashman and rebut IQVIA's defense.

Veeva explains that at-issue waiver applies where: (1) there has been assertion of the privilege through some affirmative act by the asserting party; (2) through the affirmative act, the party put the protected information at issue by making it relevant to the case; and (3) application of the privilege would deny the opposing party information vital to its defense. See In re G-I Holdings, Inc., 218 F.R.D. 428, 431-32 (D.N.J. 2003). Veeva argues that applying the principles of waiver here, IQVIA's tactical deployment of Ashman's business justification testimony places his TPA communications at issue. Veeva asserts that to support its business justification defense, IQVIA affirmatively contends, through the testimony of Ashman, that it promulgated its TPA policy in “good faith” or on a “reasonable basis.” Veeva points to illustrative excerpts from Ashman's deposition testimony as well as IQVIA's outside counsel's comment following a privilege dispute which arose during the deposition. Veeva further asserts that to bolster his testimony, IQVIA produced Ashman's TPA-related assessments, consultations, and evaluations to support its business justification defense. Specifically, IQVIA points to notes Ashman made to himself regarding the Shire Incident. Veeva asserts that IQVIA produced these notes, which are beneficial to IQVIA, but then withholds documents on the same subject matter where convenient. Veeva argues that by withholding the challenged communications, IQVIA severely prejudices Veeva's ability to prosecute its antitrust case and test Ashman's assessments, consultations, and evaluations. Thus, Veeva asserts that all the elements of at-issue waiver are satisfied.

B. IQVIA's Arguments

In response, IQVIA argues that it had a bone fide concern that Veeva was misappropriating IQVIA's intellectual property and using its access to IQVIA's market research offerings to improve its competing offering. IQVIA explains that under its current TPA program, TPA requests are initiated in an online portal (the “TPA Portal”) in which a client will identify the specific offerings and purpose for which they are requesting a TPA license. Once a request is made, a separate third party vendor receives a link to complete the application process. IQVIA then reviews the application and makes a decision as to whether or not to grant the TPA license request. In many cases, the TPA license will be approved without human review based on the application of certain business rules that have been programmed into the TPA Portal.

*4 IQVIA then explains that in a minority of instances—for approximately 35% of TPA license requests—the business rules will require “manual review,” in which case the IQVIA employee responsible for a specific market research offering is asked to approve the TPA license. In this subset of cases, if the IQVIA business employee believes there would be a risk to IQVIA's intellectual property and wants to deny a TPA request, he or she may seek advice to determine whether there may be a solution that will allow IQVIA to grant the TPA request, while still protecting IQVIA's intellectual property.

IQVIA then asserts that it has provided discovery on the various business aspects of the TPA program, including the process by which the TPA program is administered, the business rules that have been programmed into the TPA portal, the rules that will trigger manual review, and discussions among business executives regarding their manual review. IQVIA contends that Ashman had a role in those business aspects and may testify about them at trial. However, IQVIA has maintained privilege over the legal aspects of the TPA program, where IQVIA lawyers, including Ashman, have been asked to provide legal opinions and guidance. IQVIA asserts that these communications involve, for example, legal issues relating to the drafting of TPA agreements, and communications seeking or providing legal advice concerning specific TPA license requests.

IQVIA then indicates that in an effort to narrow the dispute between the parties, it produced 104 of the challenged documents—65 in full and 39 with redactions. IQVIA maintains its original position with respect to the remaining challenged documents. It explains that its inconsistent privilege calls merely reflect different judgment calls by different individuals as opposed to Veeva's assertion that it is abusing the privilege.

IQVIA argues that the documents Veeva seeks to compel are core legal communications, many of which involve in-house counsel other than Ashman, and several of which reflect communication between in-house counsel. IQVIA asserts that Veeva cannot show that the documents it seeks to compel serve a predominately business (rather than legal) purpose.

IQVIA believes the challenged documents reflect legal analysis and communications concerning the provision of legal advice by IQVIA's in-house counsel. Communications that involve business issues may nevertheless be privileged when the communication has a primary purpose of seeking legal advice regarding those business issues. See e.g. Tucker v. Fischbein, 237 F.3d 275, 288 (3d Cir. 2001); Faloney v. Wachovia Bank, N.A., 254 F.R.D. 204, 209-12 (E.D. Pa. 2008). IQVIA argues that communications concerning the intellectual property risks associated with the use of IQVIA's market research data in third party applications, IP protection, and TPA license agreements involve inherently legal issues, including contract negotiation and the protection if IQVIA's intellectual property, and are thus the appropriate subjects of legal advice.

IQVIA argues that an individualized review of the privilege log entries shows that Veeva has challenged a range of documents, including draft versions of documents sent to counsel for the primary purpose of seeking legal advice, communications with counsel or documents prepared by counsel for the purpose of facilitating legal advice regarding the Novartis pilot, communication with or among in-house counsel or with external counsel about intellectual property issues, and business employees requesting legal advice from in-house counsel. IQVIA notes that a significant number of these communications do not involve communications with Ashman but rather involve communications with IQVIA's other in-house counsel, including Edward Spaniel and David McCoy. IQVIA asserts that Spaniel and McCoy have more traditional “legal” responsibilities within IQVIA. IQVIA also points out that Ashman testified that he has “responsibilities relating to the TPA program that are legal in nature.”

*5 IQVIA reiterates that Ashman's communications principally concern legal aspects of the TPA program, including specific requests for legal advice related to the TPA program. IQVIA challenges Veeva's reliance on SCM Corp. v. Xerox Corp., 70 F.R.D. 508, 517 (D. Conn. 1976), and argues that case law makes clear that privilege determinations are highly-context specific and not subject to per se rules. IQVIA further argues that courts have widely recognized that decisions to share and license data involve legal considerations and may be privileged. See e.g. Polaris Innovations Ltd. v. Kingston Tech. Co., 16-cv-300, 2017 WL 8220457, at *6-8 (C.D. Cal. June 16, 2017). IQVIA asserts that the cases Veeva cites rejected a claim of privilege where none of the documents appeared to contain any legal research or analysis and the party invoking the privilege had given the court no reason to find that such work could not have been performed by non-lawyers, while here the communications at issue contain, reference, enable and reflect the provision of legal advice.

IQVIA also argues that the Special Master's prior ruling as to documents subpoenaed from EY related to documents created and disclosed by EY, not IQVIA's legal team. Here by contrast, the communications involve IQVIA's deputy general counsel and other in-house counsel, and had the provision of legal guidance as a primary purpose. Thus IQVIA argues that the Special Master's prior ruling in no way disposes of the context-specific privilege issues involved here.

IQVIA next contends that it did not waive the attorney-client privilege protecting the challenged communications. IQVIA asserts that Veeva failed to demonstrate two necessary elements for waiver: (1) that IQVIA has affirmatively put Ashman's legal advice at issue; and (2) that it is vital that Veeva be permitted to invade the privilege. IQVIA argues that it has not placed the challenged communications at issue in the case. IQVIA asserts that Veeva provides no example of IQVIA disclosing or describing the details of any of the privileged communications sought in the motion. IQVIA argues that Veeva's assertion that its privilege claims have been waived because the documents might be relevant to IQVIA's business justification defense fails because the advice is not at issue merely because it is relevant. IQVIA contends that Veeva's argument on waiver ignores the fact that in-house counsel are often involved in business matters, and the testimony of Ashman supporting the business justification defense relates to his role in those business matters—not the legal advice he has provided. IQVIA argues that the mere fact that counsel provided legal advice on an issue, without more, is not sufficient to put the legal advice at issue.

IQVIA asserts that its counsel clearly represented at Ashman's deposition that Ashman would not testify about information that was protected by attorney-client privilege or attorney work product privilege because IQVIA was not waiving the privilege. IQVIA's counsel then instructed that Ashman would be permitted to testify as to his factual knowledge of incidents of data misuse by Veeva—all of it. IQVIA asserts that neither of the documents relied upon by Veeva—Ashman's notes to himself reflecting information from a call with Veeva and a statement by outside counsel at Ashman's deposition—relate to IQVIA's TPA policy, or invoke any legal advice that Ashman offered concerning TPA decisions. IQVIA argues that Veeva's motion is devoid of a single instance of IQVIA advancing its business-justification defense by disclosing or describing or relying upon Ashman's privileged communications.

IQVIA further argues that Veeva cannot show that it will be prejudiced if the requested communications are not produced. IQVIA asserts that it is not relying on Ashman's legal advice to establish its business justification defense. In any event, IQVIA argues that it has produced tens of thousands of documents concerning its TPA program and IQVIA employees have provided hundreds of pages of deposition testimony about the TPA program. IQVIA contends that the evidence also shows that IQVIA's business executives had legitimate concerns about permitting the use of its market research offerings in Veeva Network. IQVIA maintains it did not put any specific legal guidance at issue, so the suggestion of a corresponding wavier is fundamentally mistaken.

C. Veeva's Reply

*6 In reply, Veeva argues that IQVIA has failed to respond to its arguments and only offers conclusory statements about the challenged documents, thus failing to meet its burden of proving the privilege applies. Veeva argues that courts in this district have rejected privilege claims where counsel “himself describes the issue before him as a business decision.” In re Hum. Tissue Prod. Liab. Litig., 06-cv-135, 2009 WL 1097671, at 31 (D.N.J. Apr. 23, 2009). Veeva further argues that IQVIA misapplies the Court's analysis in IQVIA v. Veeva Systems, 2019 WL 2069186 (D.N.J. July 11, 2019), because irrespective of any legal dimensions, the challenged communications purport to address the same “business purpose” as the EY audit and are not privileged.

Veeva argues that the 104 documents IQVIA produced in response to its motion prove that formulation of the TPA policy could have been and was accomplished by a non-lawyer. Veeva asserts that the documents bear no indicia of privilege and instead prove that IQVIA devised its TPA policy exclusively through business executives without legal input. Veeva points to a September 23, 2014, email which it argues demonstrates that non-lawyers Mike Allelunas, Seyed Mortazavi, and Sati Sian established TPA policy without legal assistance and then simply dictated it to in-house counsel Edward Spaniel. Veeva argues that since IQVIA designed TPA policy without direction from a lawyer, associated discussions are not privileged. HPD Labs, Inc. v. Clorox Co., 202 F.R.D. 410, 411, 416 n.8. (D.N.J. 2001).

Veeva further asserts that IQVIA has committed at issue waiver. It argues that IQVIA offers no substantial response and simply asserts that its disclosed communications are business-related while its withheld ones are legal. Veeva argues that this unprincipled and opportunistic approach constitutes waiver by “defin[ing] selectively the subject matter of the advice of counsel on which it relied in order to limit the scope of the waiver of the attorney-client privilege and therefore the scope of discovery.” Harding v. Dana Transp., 914 F. Supp. 1084, 1095 (D.N.J. 1995). Veeva argues that at issue waiver occurs where a party cites consultation with counsel to advance an affirmative defense, amounting to an “implicit” assertion of “reliance on counsel.” Veeva points to In re G-I Holdings, 218 F.R.D. 428, 432-33 (D.N.J. 2003) and In re Human Tissue, 255 F.R.D. 151, to argue that IQVIA's business justification amounts to a reliance of counsel defense, waiving privilege over related TPA communications.

Veeva also asserts that the challenged communications are more than merely relevant, they are necessary for Veeva to adequately cross-examine IQVIA's lead witness and further undermine its business justification defense. Veeva further argues that other IQVIA employees could not testify to the basis of IQVIA's TPA policy and deflected to Ashman.

DISCUSSION

A. Privilege Generally

Evidentiary privileges are an exception to the general rule that relevant evidence is admissible. Rhone-Poulenc Rorer Inc. v. Home Indem. Co., 32 F.3d 851, 862 (3d. Cir. 1994). Privileges forbid the admission of otherwise relevant evidence when certain interests that the privileges are thought to protect are considered more important than the interests served by the resolution of litigation through full disclosure of all relevant facts. Id. “The privilege forbidding the discovery and admission of evidence relating to communications between attorney and client is intended to ensure that a client remains free from apprehension that consultations with a legal advisor will be disclosed.” Id. The privilege encourages the client to reveal confidences to the lawyer necessary for the lawyer to provide advice and representation. Id.; see also Upjohn Co. v. United States, 449 U.S. 383, 389 (1981) (holding that the purpose of the attorney-client privilege 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.”). Thus, the attorney-client privilege protects (1) communications (2) between “privileged persons” (3) made in confidence (4) intended to receive or give legal assistance. In re Teleglobe Commc'ns Corp., 493 F.3d 345, 359 (3d Cir. 2007), as amended (Oct. 12, 2007) (quoting Restatement (Third) of the Law Governing Lawyers § 68 (2000)). The attorney-client privilege extends to corporations which must act through agents, including their officers and employees. Leonen v. Johns-Manville, 135 F.R.D. 94, 98 (D.N.J. 1990).

*7 Because the privilege obstructs the truth-finding process, it is construed narrowly, and “ ‘protects only those disclosures – necessary to obtain informed legal advice – which might not have been made absent the privilege.’ ” Westinghouse Elec. Corp. v. Republic of the Philippines, 951 F.2d 1414, 1423-24 (3d Cir. 1991) (quoting Fisher v. United States, 425 U.S. 391, 403 (1976)). Therefore, for a communication to be protected, it must be made to an attorney for the express purpose of obtaining legal advice. Fisher, 425 U.S. at 403. Business and personal advice are not protected by the privilege. Claude P. Bamberger Inter. Inc. v. Rohm and Haas Co., 96-cv-1041, 1997 WL 33768546, at * 2 (D.N.J. Aug. 12, 1997) (citing United States v. Davis, 636 F.2d 1028, 1044 (5th Cir. 1978), cert. denied, 454 U.S. 862 (1981)).

The attorney-client privilege does not apply simply because a statement was made by or to an attorney. Nanticoke Lenni-Lenape Tribal Nation v. Porrino, 2017 WL 4155368, at *3 (D.N.J. Sept. 19, 2017). Merely copying an attorney on an e-mail does not, in and of itself, make the email privileged. In re Human Tissue Products Liability Litigation, 255 F.R.D. 151, 164 (D.N.J. 2008); Andritz Sprout-Bauer, Inc. v. Beazer East, Inc., 174 F.R.D. 609, 633 (M.D. Pa. 1997) (“What would otherwise be routine, non-privileged communications between corporate officers or employees transacting the general business of the company do not attain privileged status solely because in-house counsel or outside counsel is ‘copied in’ on correspondence or memoranda”); United States Postal Serv. v. Phelps Dodge Ref. Corp., 852 F.Supp. 156, 163 (E.D.N.Y. 1994) (“A corporation cannot be permitted to insulate its files from discovery simply by sending a ‘cc’ to in-house counsel”). “ ‘To rule otherwise would allow parties to evade the privilege limitations by sending copies of every company-generated e-mail to the company's attorney so as to protect the communication from discovery, regardless of whether legal services were sought or who the other recipients of the e-mail were.’ ” In re Human Tissue Products Liability Litigation, 255 F.R.D. at 164 (quoting In re Avantel, S.A., 343 F.3d 311, 321 (5th Cir. 2003)). If a privileged document has attachments, each attachment must individually qualify for the privilege. “Merely attaching something to a privileged document will not, by itself, make the attachment privileged.” Leonen, 135 F.R.D. at 98 (citing Sneider v. Kimberly-Clarke Corp., 91 F.R.D. 1 (N.D. Ill. 1980)). The applicability of the attorney-client privilege is determined on a case-by-case basis, Upjohn, 449 U.S. at 396–97, and the burden of establishing that a document is protected by the attorney-client privilege is on the party asserting the privilege. Torres v. Kuzniasz, 936 F.Supp. 1201, 1208 (D.N.J. 1996).

B. Business v. Legal Purposes

“Communications which relate to business rather than legal matters do not fall within the protection of the [attorney-client] privilege.” Alpha Painting & Constr. Co., Inc. v. Del. River Port Auth., 208 F.Supp.3d 607, 623 (D.N.J. 2016), aff'd in relevant part, 853 F.3d 671 (3d Cir. 2017); see also In re Riddell Concussion Reduction Litig., 13-cv-7585, 2016 WL 7108455, at *4 (D.N.J. Dec. 5, 2016), on reconsideration in part, 13-cv-7585, 2017 WL 11633446 (D.N.J. Jan. 5, 2017) (an attorney who is not performing legal services or relaying legal advice and who performs non-legal duties does not qualify for the privilege, even if litigation may arise from the subject of the attorney's activities); Leonen v. Johns-Manville, 135 F.R.D. at 98–99 (privilege did not protect the communications with in-house counsel relating to business rather than legal matters). The general rule is that “while legal advice given to a client by an attorney is protected by the privilege, business advice generally is not.” La. Mun. Police Emps. Retirement Sys. v. Sealed Air Corp., 253 F.R.D. 300, 305 (D.N.J. 2008); see also Rowe v. E.I. duPont de Nemours & Co., 06-cv-1810, 2008 WL 4514092, at *8 (D.N.J. Sept. 30, 2008) (noting modern corporate counsel are involved in all aspects of the company for which they work, and in-house counsel participates in and renders decisions about business, technical, scientific, public relations, and advertising issues, as well as purely legal issues).

*8 Where a communication contains both legal and business advice, the attorney-client privilege will apply only if the primary purpose of the communication was to aid in the provision of legal advice. Id. (citing Hercules, Inc. v. Exxon Corp., 434 F.Supp. 136, 147 (D.Del. 1977)). Just as a litigant may not shield non-privileged information from discovery by combining it with legal advice, a litigant cannot cloak business information in privilege by involving an attorney in the communication of business matters. United States v. Rockwell Int'l, 897 F.2d 1255 (3d Cir. 1990) (“The sine qua non of any claim of privilege is that the information sought to be shielded is legal advice.”); Yang v. Reno, 157 F.R.D. 625, 636 (M.D. Pa. 1994) (holding that the attendance of an attorney at meeting called by the attorney did not render everything said or done at that meeting privileged, rather, for the privilege to apply, the communication must have related to the acquisition or rendition of professional legal services).

Given that “legal advice is often intimately intertwined with and difficult to distinguish from business advice .... [and] [b]ecause it is often too difficult, impractical and unrealistic to compartmentalize whether certain advice given to a client is legal in nature or business in nature in the context of a complicated... transaction, the policy behind the attorney-client privilege is best upheld where the attorney-client relationship is predominantly for the purpose of rendering legal services.” Sealed Air Corp., 253 F.R.D. at 306 (citations and quotations omitted). The party claiming privilege “should demonstrate that the communication would not have been made but for the client's need for legal advice or services” Id. (citing Leonen, 135 F.R.D. at 99).

Here, Veeva argues that IQVIA's TPA policy is fundamentally a business initiative. Veeva relies on SCM Corp. v. Xerox Corp., 70 F.R.D. 508, 517 (D. Conn. 1976), which involved antitrust litigation and the plaintiffs’ deposition questions involving reasons or considerations involved in decisions to grant or refuse licenses. There, the court stated:

Licensing decisions may contain a legal component, but are not inherently dependent on legal advice; they are essentially business decisions. Legal advice should remain protected along with ‘nonlegal considerations’ discussed between client and counsel that are relevant to that consultation, but when the ultimate decision then requires the exercise of business judgment and when what were relevant nonlegal considerations incidental to the formulation of legal advice emerge as the business reasons for and against a course of action, those business reasons considered among executives are not privileged. They are like any other business evaluations and motivations and do not enjoy any protection because they were alluded to by conscientious counsel. To protect the business components in the decisional process would be a distortion of the privilege. The attorney-client privilege was not intended and is not needed to encourage businessmen to discuss business reasons for a particular course of action.
[Id. at 517 (citations omitted).]

In SCM Corp., the deponent was unable to separate the business and legal aspects of the licensing decisions. The court then ordered the deponent to answer the questions in an affidavit to be submitted for in camera inspection and describe the decision-making process so that the court could determine whether the business considerations were the type of “relevant nonlegal considerations” incidental to legal consultation. Id. at 517.

Here, there is no dispute that IQVIA's TPA policy involved business decisions. The issue before the Special Master is whether IQVIA's TPA policy also involved legal decisions and whether those legal decisions are subject to attorney-client privilege. Veeva argues that because IQVIA's TPA policy served a predominately business purpose, any communication involving in-house counsel related to IQVIA's TPA policy is not protected by attorney-client privilege. Meanwhile, IQVIA argues that while business decisions related to its TPA policy are not privileged, the communications of in-house counsel related to legal aspects of its TPA policy are protected by attorney-client privilege.

*9 The Special Master believes that IQVIA's TPA decisions are principally business decisions. However, the Special Master does not believe that all TPA communications involving in-house counsel lose their privileged status if the communication involves a TPA. While TPA decisions in general may be predominately business in nature, communications solely or predominantly involving legal advice are still protected by the privilege. In other words, the Special Master does not believe that communications involving in-house counsel automatically lose their privileged status if the communication involves a TPA. Rather, each communication withheld on the basis of privilege must be individually evaluated to determine whether the communication with counsel was made for a predominately legal or business reason. Legal advice should remain protected.

The Special Master therefore rejects Veeva's blanket conclusion that since IQVIA's TPA policy is predominately business in nature, all communications involving IQVIA in-house counsel referring to the TPA program therefore serves a predominately business nature and cannot be privileged. Instead, the Special Master believes that each challenged communications must be evaluated on an individual basis to determine whether the communication was made predominantly for the purpose of rendering legal advice as opposed to business advice. The Special Master agrees that communications involving in-house counsel addressing business strategy and public relations and communications made for a predominately business purpose should not be marked as privileged. The Special Master has therefore conducted a comprehensive review of all the challenged communications. The Special Master's decision as to the privileged status of each communication is detailed in the Appendix attached to this Order and Opinion.

C. At Issue Waiver

The attorney-client privilege is waived when “the client has made a conscious decision to inject the advice of counsel as an issue in the litigation.” Glenmede Trust Co. v. Thompson, 56 F.3d 476, 486 (3d Cir. 1995). To determine whether there has been an “at issue” waiver, there are several factors that courts have considered: (1) whether “assertion of the privilege was a result of some affirmative act, such as filing suit, by the asserting party;” (2) whether “through this affirmative act, the asserting party put the protected information at issue by making it relevant to the case;” and (3) the opposing party would be denied vital information to his defense with the application of the privilege. In re Human Tissue, 255 F.R.D. at 159 (citing Hearn v. Rhay, 68 F.R.D. 574, 581 (E.D. Wash. 1975)). Other courts have focused on overriding fairness considerations in assessing whether an implied waiver has occurred. In re Human Tissue, 255 F.R.D. at 159. See, e.g., Goldberg v. Hirschberg, 10 Misc.3d 292, 806 N.Y.S.2d 333, 335 (N.Y. Sup. Ct. 2005) (“The sanctity of the attorney-client privilege notwithstanding, ‘[it] may implicitly be waived when [a party] asserts a claim that in fairness requires examination of protected communications.’ ”)(quoting United States v. Bilzerian, 926 F.2d 1285, 1292 (2d Cir. 1991)); Wolosoff, 196 N.J. Super at 567 (“We are persuaded that ‘when confidential communications are made a material issue in a judicial proceeding, fairness demands waiver of the privilege.’ ”); In re Hillsborough Holdings Corp., 176 B.R. 223, 238-39 (M.D. Fla. 1994) (“A party waives the attorney-client and accountant-client privileges which attach to various communications if that party ‘injects into the case an issue that in fairness requires an examination of otherwise protected communications.’ ”). Whether fairness requires disclosure is decided “on a case-by-case basis, and depends primarily on the specific context in which the privilege is asserted.” In re Grand Jury Proceedings, 219 F.3d 175, 183 (2d Cir. 2000).

*10 The Third Circuit, in Rhone–Poulenc, explained the rationale behind finding a waiver when a client uses a reliance-on-counsel defense:

Courts have found that by placing the advice in issue, the client has opened to examination facts relating to that advice...The advice of counsel is placed in issue where the client asserts a claim or defense, and attempts to prove that claim or defense by disclosing or describing the attorney client communication.
[Rhone-Poulenc Rorer Inc. v. Home Indem. Co., 32 F.3d 851, 863 (3d Cir. 1994).]

Thus “[w]hen a party cites legal representation as an affirmative defense to a claim, however, the party puts that advice ‘at issue’ and waives the attorney-client privilege.” In re G-I Holdings Inc., 218 F.R.D. 428, 431 (D.N.J. 2003). See also Livingstone v. N. Belle Vernon Borough, 91 F.3d 515, 536-37 (3d. Cir. 1996) (the plaintiffs, husband and wife, placed advice of counsel at issue by challenging the voluntariness of their execution of an agreement with the defendants, because “the advice of counsel is an explicit, and important, element of the voluntariness analysis”) (citation omitted); Glenmede Trust Co., 56 F.3d at 486 (“Glenmede raised reliance on the advice of counsel ... as an affirmative defense to the Thompson family's claims and voluntarily produced the Opinion Letter and a draft of it in response to discovery requests.”); Avco Corp. v. Turner, 2:20-cv-04073, 2021 WL 3487321, at *3 (E.D. Pa. Aug. 9, 2021) (“Avco has used confidential communications to prove an element of its claim, and it therefore has placed the substance of the communications at issue.”); Brigham & Women's Hosp. Inc. v. Teva Pharms. USA, Inc., 707 F. Supp. 2d 463,471 (D. Del. 2010) (in a patent infringement case, the party asserting privilege waived it by indicating “that they intended to defend against the claim of inequitable conduct by calling the ... prosecuting attorneys at trial to testify”); Minebea Co., Ltd. v. Papst, 355 F. Supp. 2d 518, 523-24 (D.D.C. 2005) (in a patent infringement case, applying the Hearn factors criticized in Rhone-Poulenc); In re G-I Holding Inc., 218 F.R.D. 428, 433 (D.N.J. July 17, 2003) (also applying Hearn but nonetheless finding that “the party now asserting the privilege took an affirmative act by raising a ‘reliance on counsel’ defense”); Harding v. Dana Transp., Inc., 914 F. Supp. 1084, 1098 (D.N.J. 1996) (the defendant waived the attorney-client privilege and work-product doctrine by asserting the results of its attorney's investigation as an affirmative defense); Bird v. Penn Cent. Co., 61 F.R.D. 43, 45, 48 (E.D. Pa. 1973) (in an insurance policy rescission case, declining to determine waiver but finding that the work-product doctrine must give way to the defendant's “substantial need” for the documents under Rule 26(b)(3) after the special master found that the plaintiffs had “interject[ed]” the advice of counsel conducting the underlying claim investigation “as a reason for not seeking rescission sooner”).

Veeva points to In re G-I Holdings, 218 F.R.D. at 433, to support its arguments. In that matter, the IRS sued the debtors for tax-code violations. In an interrogatory response, the debtors claimed their conduct was justified by a reasonable basis demonstrated in part by consultation with counsel on the tax issue. The court held that the debtor's response met the three-part Hearn test for “at issue” waiver as (1) the party now asserting the privilege took an affirmative act by raising a “reliance on counsel” defense; (2) through the affirmative act, the party asserting the privilege put the protected information at issue by making it relevant to the penalty issue in this case; and (3) the application of the privilege would deny the party seeking discovery, the Government, access to information vital to the prosecution of its claim. Id. (citing Hearn, 68 F.R.D. at 581. The court found that their waiver extended to the subject matter about which they responded. Id. at 433.

*11 Veeva argues that Ashman's “business justification” testimony places his TPA communications at issue. Veeva asserts that IQVIA (1) affirmatively contends that it promulgated its TPA policy in good faith to support its business justification; (2) relies on Ashman's TPA-related assessments, consultation, and evaluations to support is business justification defense; and (3) that barring access to the challenged communication prejudices Veeva's ability to prosecute its antitrust case to test Ashman's assessments.

Conversely, IQVIA contends that it did not place the challenged communications at issue as there has not been a single instance of IQVIA advancing its business-justification defense by relying upon any of the withheld Ashman communications. IQVIA argues that it did not put any specific legal guidance at issue, so the suggestion of a corresponding waiver is mistaken. IQVIA asserts that it has maintained privilege over the legal aspects of the TPA program, where IQVIA's lawyers, including Ashman, have been asked to provide legal opinions and guidance.

The Special Master finds In re Human Tissue Liability Litigation, 255 F.R.D. 151, instructive to this matter. In re Human Tissue Liability Litigation, involved a criminal enterprise by Biomedical Tissue Services, Ltd. and its principal Michael Mastromarino (“Mastromarino”) to harvest tissue from human corpses without obtaining proper consents and following appropriate regulations. One of the defendants, RTI, retained the law firm of Holland and Knight to conduct a background investigation of Mastromarino based on his abusive behavior toward certain RTI employees, and rumors circulating concerning his alleged involvement in organized crime. The plaintiffs sought production of ten documents related to this background investigation which RTI claimed were protected by the attorney-client and/or attorney work product privilege. The plaintiffs did not dispute that such documents were privileged. Instead, the plaintiffs argued that in order to maintain their good faith immunity defense, RTI would use the investigation and what they learned from the investigation, thereby waiving any privilege. RTI opposed the plaintiffs’ request on the basis that they had not raised advice of counsel as an affirmative defense, nor had they affirmatively placed the investigations and/or related communications at issue through their actions. RTI also represented that it was not relying upon such privileged communications in support of its good faith immunity defense.

The court found that although RTI represented that it was not relying on the advice of counsel or any other privileged communication—including the background investigation of Mastromarino—in support of its good faith immunity defense, that such reliance was implicit to RTI's defense. The court determined that RTI affirmatively relied on the good faith immunity defense and that in order to succeed on its good faith immunity defense, RTI needed to show that it did not know—and that one using reasonable care under the circumstances should not have known—that the consent forms submitted by Mastromarino had been falsified. RTI retained the law firm of Holland & Knight to do a background check of Mastromarino in early 2003. RTI alleged that other than learning about Mastromarino's drug problems, there was no additional “negative information” learned as a result of the background investigation. As a result, “nothing special” was done at the conclusion of the investigation. The court found that such testimony not only implied that the fruits of the Mastromarino background investigation were unremarkable, but also affirmatively placed at issue RTI's knowledge about the suitability of doing business with Mastromarino from as early as October 2002. The court's assessment of RTI's good faith will, therefore, turned on what RTI knew or should have known during the relevant time period.

*12 The court thus found that having chosen to go beyond mere denial of the plaintiff's claims, RTI could not on the one hand implicitly rely on the fruits of this background investigation as evidence that RTI exercised its diligence and thus had no reasonable basis of knowing that the consent forms submitted by Mastromarino were fabricated, while at the same time depriving the plaintiffs of access to this information on the basis of privilege. To do so would prevent the plaintiffs from effectively challenging RTI's good faith intentions in choosing to continue their business relationship with Mastromarino during the relevant time period, and therefore undercut the fairness considerations underlying the attorney-client privilege doctrine. See, e.g., In re Grand Jury Proceedings, 219 F.3d at 182 (“fairness considerations arise when the party attempts to use the privilege both as ‘a shield and a sword.’ ”) (internal quotations omitted); Clark v. United States, 289 U.S. 1, 15, 53 S.Ct. 465, 77 L.Ed. 993 (1933) (recognizing the privilege protecting communications between attorney and client, but noting that “[t]he privilege takes flight if the relation is abused”). Accordingly, the court found that RTI impliedly waived the attorney-client and/or attorney work product privilege with respect to those communications related to their knowledge about the suitability of doing business with Mastromarino during the relevant time period

In its antitrust case, Veeva alleges that IQVIA's TPA policy prohibited customers from using IQVIA's data products with Veeva's software thereby impairing competition in data markets. IQVIA argues that its TPA policy served a valid business justification, that being the protection of IQVIA's intellectual property, rather than anticompetitive ends. IQVIA intends to rely on Harvey Ashman, its deputy general counsel, to support its business justification defense. IQVIA argues that it is only relying on the non-privileged communication and testimony of Ashman related to IQVIA's TPA policy. However, by putting forward Ashman in support of its business justification defense, IQVIA has put Ashman's entire involvement with IQVIA's TPA program at issue, including his legal communications involving his assessments, consultations, and evaluations related to the TPA program.

IQVIA argues that it is not relying on any of the withheld attorney-client privileged documents related to its TPA program to support its defense. For instance, IQVIA argues it has maintained privilege over specific requests for legal advice concerning TPA license requests for its clients including Eli Lilly, Novartis, AbbVie, and GSK. However, just as in In re Human Tissue Liability Litigation, the Special Master finds that IQVIA has impliedly waived the attorney-client privilege with respect to Ashman's TPA program communications. Contrary to IQVIA's arguments, at issue waiver is not so narrow that a communication would only be put at issue if it is specifically relied upon in support of its business justification defense. In re Human Tissue Liability Litigation, 255 F.R.D. 151. In relying on the testimony of Ashman, IQVIA cannot produce information and select communications of Ashman that support its defense and then utilize attorney-client privilege to withhold purportedly “legal” information or communications of Ashman related to legal aspects of IQVIA's TPA program and its application. To allow otherwise, would be unfair. Veeva must be permitted to challenge the veracity of IQVIA's business justification defense and probe the extent to which IQVIA devised its TPA program to advance monopolistic objectives as alleged. Shielding “legal” information and communications of Ashman related to the formation and application of IQVIA's TPA program would severely hinder Veeva's ability to challenge IQVIA's assertion that its TPA program served a valid business justification.

The testimony of IQVIA VP and General Manager Dan Barton demonstrates the inherent unfairness of withholding Ashman's TPA related communications. Mr. Barton was asked about IQVIA's TPA position with respect to a specific customer, Eli Lilly, and TPA restrictions on customers’ use of certain sales data attributes with Veeva Network. Mr. Barton stated that he could not answer counsel's questions due to privileged discussions with Ashman. Mr. Barton's testimony demonstrates how it is fundamentally unfair to allow IQVIA to rely on Ashman to support its TPA program business justification defense while also permitting IQVIA to withhold the privileged information and communications of Ashman related to IQVIA's TPA program. It plainly prevents Veeva from probing aspects of IQVIA's TPA program to challenge IQVIA's business justification defense.

*13 By asserting that its TPA program served a valid business justification and putting forward Ashman to support that defense, IQVIA has put all aspects of its TPA program as it relates to Ashman at issue, not just the “business” aspects of its TPA program. In sum, the Special Master finds that (1) IQVIA affirmatively contends that it promulgated its TPA policy in good faith to support its business justification defense; (2) IQVIA intends to utilize Ashman as its primary trial witness for its business justification defense; (3) by utilizing Ashman is support of its defense IQVIA had placed Ashman's “business” and “legal” involvement with the formation and application of the TPA program at issue, this includes Ashman's legal communications involving his assessments, consultations, and evaluations related to the TPA program; and (4) that barring access to the challenged communications prejudices Veeva's ability to prosecute its antitrust case and test IQVIA's business justification defense.

The Special Master has conducted a comprehensive in camera review of all the challenged documents. The Special Master first notes that a significant portion of the documents do not involve communications with Harvey Ashman, but rather other lawyers at IQVIA, most notably David McCoy and Edward Spaniel. Accordingly, not every challenged document is subject to production on the basis of at issue waiver.

The Special Master has reviewed each document, together with IQVIA's privilege log and in several cases corresponding documents, so that each privilege assertion could be properly evaluated. The Special Master's decision as to the privileged status of each communication as it relates to at issue waiver is detailed in the Appendix attached to this Order and Opinion. With respect to those documents which the Special Master has ordered to be produced, IQVIA is to produce the documents within 15 days of the date of this Order.

Appendix to the Special Master's September 15, 2022 Order and Opinion

Direct Communications with Edward Spaniel or David McCoy