Free Motion to Compel - District Court of Arizona - Arizona

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SUSAN MARTIN (AZ#014226) DANIEL L. BONNETT (AZ#014127) JENNIFER KROLL (AZ#019859) MARTIN & BONNETT, P.L.L.C. 3300 N. Central Avenue, Suite 1720 Phoenix, Arizona 85012-2517 Telephone: (602) 240-6900 [email protected] [email protected] [email protected] Attorneys for Plaintiffs IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA Barbara Allen, Richard Dippold, Melvin Jones, Donald McCarty, Richard Scates and Walter G. West, individually and on behalf of all others similarly situated, Plaintiffs, vs. Honeywell Retirement Earnings Plan, Honeywell Secured Benefit Plan, Plan Administrator of Honeywell Retirement Earnings Plan and Plan Administrator of Honeywell Secured Benefit Plan, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

No. CV04-0424 PHX ROS

Plaintiffs Renewed Motion to Compel Disclosure of Documents Withheld By Defendants on Claim of Attorney-Client and/or Work Product Privilege and Memorandum of Points and Authorities in Support of Renewed Motion

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INTRODUCTION Plaintiffs hereby move this Court for an order compelling Defendants to produce the documents enumerated on Exhibit A attached hereto. For the Court s convenience, each of the documents requested by Plaintiffs is presented in a chart attached hereto as Exhibit A with the following descriptive detail: 1) the document number on Defendants revised privilege log; 2) Defendants identification of the date of the document; 3) Defendants

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reference to the document, if any, in Defendants declarations submitted on August 26, 2006, (Doc. 225), in opposition to Plaintiffs June 15, 2006 motion to compel, (Doc. 169); 4) the document number on Defendants first privilege logs, if relevant; 5) Defendants description of the document as listed on their revised privilege log; 6) Defendants description, if any, of the recipient; 7) Defendants description, if any, of the sender; 8) Defendants claim of privilege, and 8) a brief summary of Plaintiffs reasons why each document should be produced. I. PROCEDURAL HISTORY Plaintiffs served discovery on Defendants in this case in July 2005. After numerous discovery conferences between the parties, on April 26, 2006, Defendants first produced Defendants Log of Documents Withheld as Privileged. Following additional conferences

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and written communications in an attempt to resolve the parties discovery disputes, Defendants produced Defendants Amended Log of Documents Withheld As Privileged on June 9, 2006. On June 16, 2006, the Court held a telephonic conference regarding the parties discovery dispute. During the conference, the Court stated: [I]n accordance with Rule 26, first of all, it is the obligation of whoever is claiming the privilege to establish that privilege, and to set forth enough information so that the opponent of the privilege can respond. That means, Mr. Rosenbaum and Mr. Banks and Mr. Delany, that you are to provide to this Court a legal document which will be provided to plaintiffs' counsel, which will establish the basis for your claim of the work product or
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attorney-client privilege. Then the plaintiffs can file a response. At that point you can submit to me the documentation that I should review in camera to determine whether or not the privilege applies. (Reporter's Transcript of Proceedings (Telephonic Discovery Dispute), Doc. 175, p. 10.) Following that conference, Defendants submitted a brief concerning their claim of privilege, (Doc. 225), and Plaintiffs responded. (Doc. 234.) Prior to receiving notice from the parties regarding ongoing settlement discussions, the Court had not ruled on the motion. Thereafter,

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Defendants provided Plaintiffs with a First Supplemental Log of Documents Withheld As Privileged and a Second Supplemental Log of Documents Withheld As Privileged which contained an additional 68 documents. Following the status conference held on November 2, 2007, in which the Court addressed, inter alia, the parties Partial Settlement and outstanding matters, the parties conferred regarding the privilege issues. Defendants provided Plaintiffs with a revised privilege log on November 27, 2007. In accordance with the Fifth Revised Scheduling Order, (Doc. 322), and following additional conferences with Defendants, Plaintiffs hereby renew their motion to compel Defendants to produce the following documents: 7, 8, 9, 10, 11, 12, 13, 14, 19, 28, 31, 32, 33, 34, 35, 36, 37, 38, 29, 40, 41, 43, 44, 45, 46, 47, 48, 50, 51, 53, 54, 55, 56, 57, 58, 66, 68, 87, 101, 102, 103, 104, 105, 106, 107, 108, 109, 110, 111, 112, 113, 114, 115, 116, 117, 118, 119, 120, 121, 122.1 II. THE FIDUCIARY EXCEPTION TO ATTORNEY CLIENT PRIVILEGE Under the fiduciary exception to the attorney client privilege, an employee benefit plan s participants and beneficiaries, such as the Plaintiff Class are considered to be the true clients of attorneys who provide legal advice regarding matters of plan administration, including participant administrative claims and appeals like the Plaintiffs claims and appeal

Although Defendants removed several disputed items from the revised privilege log, they have still not produced them to Plaintiffs.
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in this case. In re Grand Jury Proceedings, 162 F. 3d. 554, 556-57 (9th Cir. 1998); see also United States v. Mett, 178 F. 3d 1058 (9th Cir. 1999). As applied in the ERISA context, the fiduciary exception provides that an employer acting in the capacity of ERISA fiduciary is disabled from asserting the attorney-client privilege against plan beneficiaries on matters of plan administration. Mett, 178 F.3d at 1063 (citations omitted). See Koch v. Exide Corp., 1989 WL 49515 at *3 (E.D. Pa. 1989) (Fiduciary exception is grounded in trust law

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principles. The exception applies because the attorney s client is not the fiduciary personally but rather, the trust s beneficiary. ); In re Unisys Corp. Retiree Medical Benefits ERISA Litig., 1994 U.S. Dist. LEXIS 1344 at *10 (E.D. Pa. 1994). [A] fiduciary owes the obligation to his beneficiaries to go about his duties without obscuring his reasons from the legitimate inquiries of the beneficiaries. Valente v. Pepsico, Inc., 68 FRD 361, 370 (D.Del. 1975). See Washington- Baltimore Newspaper Guild Local 35 v. Washington Star Co., 543 F. Supp. 906 (D.D.C. 1982). ERISA regulations, which require full disclosure of all documents submitted, considered, or generated in the course of making the benefit determination... see 29 C.F.R. § 2560.503-1 (m)(8), underscore the importance of the fiduciary exception to vindicating rights protected under ERISA. Withholding information generated or reviewed during the

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mandatory ERISA claims process under a claim of attorney client privilege is especially inappropriate given ERISA s requirements that fiduciaries provide a full and fair review and act in the best interest of the beneficiaries. 29 U.S.C. §§ 1133, 1104. See Mett, 178 F. 3d at 1063 (noting that exception may arise from trustee s duty of disclosure); Lewis v. Unum Corp. Severance Plan, 203 F.R.D. 615, 620 (D. Kan. 2001); Washington-Baltimore Newspaper Guild Local 35 v. Washington Star Co., 543 F. Supp. 906 (D.D.C. 1982). Under the fiduciary exception to the attorney client privilege, the general rule

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established by the foregoing cases is that documents generated or reviewed during the ERISA claims process are not privileged because they relate to matters of plan administration. Work product protection likewise generally does not attach unless and until a claim has been finally denied in the appeal process thereby negating the existence of any claim of work product prior to the final decision on the administrative plan appeal. Contrary to the general rule, Defendants have refused to turn over documents generated or

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reviewed in connection with Plaintiffs claim and appeal to the Plan Administrator based on the unfounded assertion that somehow litigation was inevitable thereby allowing a work product protection to arise instantaneously upon the receipt of Plaintiffs claims, or even before. Defendants have also attempted to shield documents that outside Plan counsel reviewed, claiming that outside Plan counsel was simultaneously acting for the company and somehow only reviewed or created the documents in connection with advice to the company and not the Plan. As the attorneys from Covington & Burling admit, they were retained to provide advice and assistance to the Plan Administrator in drafting responses to Retirees administrative claims. (Declaration of Richard Shea, Doc. 225, Exh. C ¶ 2). They do not claim any Chinese wall was created in this regard. Given that these attorneys were required to act on behalf of the Plan s participants including the Class Members, it is

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simply not tenable to assert that their documents and those shared with them by Defendants somehow were unrelated to their roles as counsel for the Plan. Defendants have also claimed privilege with respect to documents where no privilege could attach or where the privilege was waived because documents were distributed by the company to plan counsel, actuaries or lower level employees which would have destroyed the privilege with respect to any of these documents. By disclosure to, among others, Covington & Burling and its attorneys and the Plan actuaries, all of whom have admitted

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they were engaged, inter alia, to advise the Plan and Plan Administrator, Defendants waived any possible privilege. It would simply write the fiduciary exception out of the law to permit a privilege to attach to documents given to or created by counsel engaged to represent and draft the responses to Plaintiffs claims, by countenancing the argument that while in possession of these documents, they were only representing the Company as its role as Plan sponsor but not in its role as Plan Administrator and named fiduciary under the Plan. The work product does not apply to the documents Plaintiffs seek. Defendants claim that litigation was inevitable ignores the facts. Before bringing suit, Plaintiffs submitted

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their claims to the Plan, even those claims under ERISA as to which Plaintiffs had no obligation to exhaust administrative remedies. (Doc. 16, Promislo Decl., Exh. I, at p.2.) Plaintiffs decision to commence litigation was by no means a foregone conclusion. If it had been, there would have been no reason to ask the Plan fiduciaries to grant Plaintiffs legal claims. Following denial of Plaintiffs appeal to the Plan fiduciaries, Plaintiffs even attempted to resolve their claims and took all available steps to resolve the claims and avoid litigation. Prior to denial of Plaintiffs plan appeal there was simply no divergence of interests between the Plan and claimants such that the fiduciary exception to the attorney client privilege could be deemed to have terminated based on the inevitability of litigation. Absent clear evidence of a hardening of positions between claimants and the plan, if the disputed documents relate to plan administration the documents must be disclosed. See

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Wildbur v. ARCO Chem. Co., 974 F.2d 631, 645 (5th Cir. 1992) (discovery permitted of internal administrative process before litigation filed); Lewis v. UNUM Corp. Severance Plan, 203 FRD 615, 619-20 (D.Kansas 2001) ( The fact that litigation later resulted does not change the ordinary business nature of the attorney's legal advice into advice rendered in anticipation of litigation. );Coffman v. Metropolitan Life Ins. Co., 204 FRD 296, 299 (S.D. W.Va. 2001); Geissal v. Moore Medical Corp., 192 FRD 620, 625 (E.D. Mo. 2000)
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(prospect of post-decisional litigation against plan is an insufficient basis for gainsaying the fiduciary exception to the attorney-client privilege ). The documents Plaintiffs seek were created either before or during the administrative claim and appeal process and prior to a ruling on Plaintiffs administrative appeal. Plaintiffs do not seek any documents created by the attorneys in any of the four law firms representing Defendants in this litigation. Nor are Plaintiffs seeking any documents that post-date the filing of this lawsuit or any documents Defendants characterized as settlement documents.2 Defendants only articulated objections were that litigation was somehow inevitable and that the documents were advice to the Company as opposed to the Company as Plan administrator. At a minimum, in camera review is warranted so that the Court can properly access whether there is any reason the disputed documents should not be disclosed. III. CATEGORIES OF DOCUMENTS WITHHELD Plaintiffs seek production of the following categories of documents: A. Early Plan Administration Documents and Documents Concerning Communications with Participants. Documents 43-46, 108-122. Documents 43 through 46 and 108-22 were generated between 1980 and 2000,

With regard to settlement documents, Plaintiffs believe one exception applies and seek Document 28. Defendants recently recharacterized the document as pertaining to settlement discussions. Defendants earlier privilege log described document 28 (then numbered document 37) as a Memo re: Analysis of Plaintiffs' Administrative Claims and did not mention settlement. Defendants supporting declarations did not provide any support for the claim that it was a settlement document. (See Doc 225, Exhibit H ¶ 8, discussing Document 37 on Defendants prior privilege log, renumbered to Document 28 on Defendants revised privilege log.)
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between two and twenty-two years before the administrative claims in this case were filed.3 Contrary to Defendants contentions that these documents merely advise the plan sponsor about proposed amendments, these documents appear to concern plan administration including, inter alia, compliance with ERISA, implementation of Plan amendments and communicating with Plan participants and are therefore subject to the fiduciary exception. Matters addressing implementation of plan amendments clearly involve Plan administration as does advice concerning compliance with ERISA, fiduciary responsibilities, or other statutory requirements, including communications with participants regarding Plan features

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and changes. These matters go well beyond the mere decision whether to amend a plan, which Defendants contend is a settlor function. They impact as well the fiduciary and administrative functions of the Plan. Merely because courts have held that the decision to amend a plan is a settlor function outside the scope of fiduciary responsibility4 does not insulate these documents from disclosure where, even if they relate or refer to plan amendments, they also relate to administration of the Plan or compliance with ERISA. These documents should also be disclosed as discussed below because whatever privilege might have attached was waived when Honeywell provided the documents to outside counsel advising the Plan in connection with Plaintiffs claims and appeal or to Plan actuaries or low level or unidentified individuals.

On November 27, 2007, Defendants produced a revised privilege log which both renumbered and recharacterized documents, and removed some documents on the privilege logs. All document numbers herein refer to the documents in Defendants revised privilege log unless otherwise indicated. See, e.g., Hughes Aircraft Co. v. Jacobson, 525 U.S. 432, 443 (1999); Lockheed Corp. v. Spink, 517 U.S. 882, 891 (1996)
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B.

Pre-Appeal Decision Documents. Documents 7-14, 19, 28, 31-41,66, 68, 87, 101-106, 107. These documents concern plan administration and were generated prior to the

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decision on Plaintiffs administrative appeal in responding to Plaintiffs demands for documents or Plaintiffs administrative claims and appeal. These documents were generated by a variety of Plan employees, attorneys, Plan actuaries5 or outside counsel (but not litigation counsel)6 who advised the Plan during the claims and appeals process. These preappeal decision documents can be divided into the following sub-categories as follows: 1) The document generated after Plaintiffs made a demand for documents in June 2001 but before Plaintiffs submitted claims to the Plan Administrator on July 26, 2002: 41; 2) Documents generated after Plaintiffs filed administrative claims on July 26, 2002 but before Defendants responded to those claims on January 24, 2003: 31-40, 66, 68, 101-106; 3) Documents generated after the decision on Plaintiffs administrative claims on January 24, 2003 but before Plaintiffs appealed those claims on July 1, 2003: 19, 28, 87; 4) Documents

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generated after Plaintiffs submitted their administrative appeal on July 1, 2003 but before Defendants decided the appeal on October 29, 2003: 7-14; 14 5) Various undated documents analyzing Plaintiffs claims and appeals, draft responses to Plaintiffs claims and

Kurt Denilinger of Hewitt associates submitted a declaration stating that Hewitt Associates provides actuarial services for ...Honeywell[ s] domestic pension plans. (Doc. 225, Exh. D ¶ 1.) None of the disputed documents sent to or generated by Denlinger or Hewitt fall outside the fiduciary exception because Plan actuaries, like Plan counsel, admit that they were retained to provide advice to the Plan Administrator on matters of plan administration and compliance with fiduciary duties. (See id; see also Doc. 225, Exh. C ¶ 13; Exh. E ¶ 2; Exh. G ¶ 2; Exh. H ¶ 1, 13-15.) Lawyers in the firm of Covington & Burling handled and advised the Plan concerning Plaintiffs administrative claims and appeal. (Declaration of Richard Shea, Doc. 225, Exh.C); ¶ 2; Declaration of John Vine, Doc. 225 Exh. E¶ 2.) They either generated or received most of the documents Plaintiffs seek under this category.
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appeals and summaries of Plan language:7 47-48, 50-51, 53-58; 6)a 1984 document analyzing a claim made by Plan participant and draft response to that claim: 107. C. Additional Instances of Waiver. Documents 10, 31, 38, 41, 44, 101-105, 109, 111, 114, 116-120 There is no privilege with respect to Documents 10, 31, 38, 41, 44, 101-105, 109, 111, 114, 116-120 documents because they involve communications disclosed to or received from unidentified individuals, Plan actuaries, Plan consultants or lower level employees, see Section IV, D below, as to whom no privilege can attach and who appear to have been requested to obtain information for plan administration purposes. IV. ARGUMENT A. There Was No Divergence of Interests Prior to the Determination on Plaintiffs Plan Appeal Defendants argument that they could refuse to turn over documents that clearly relate to plan administration concerning Plaintiffs requests for documents, Plan claims and appeal (documents 7-14, 19, 28, 31-41,66, 68, 87,101-106, 107) because interests had purportedly diverged lacks merit. Defendants declarations rely on a variety of implausible and unpersuasive factors such as: substantial rumors that a Committee had been formed to challenge the SBA offset, (O Neill Decl., Doc. 225, Exh. B ¶ 10); the fact that Plaintiffs counsel s document requests went far beyond the ordinary information requests the

Although the declarations in support of Defendants opposition to Plaintiffs motion to compel generically state that each of the documents listed in subparagraph 5 above were prepared in anticipation of litigation, based on descriptions in Defendants supporting declarations with respect to those documents, there is only one document (Document 58) that specifically purports to be prepared, in part, with an eye toward litigation. However, document 58 also appears to relate to plan administration. (See Declaration of Frederick G. Sandstrom, Doc. 225, Exh. H ¶ 11, noting document 87 (58 on Defendants revised privilege log) is a memorandum analyzing the strengths and weaknesses of Plaintiffs claims and potential litigation defenses.)
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Company receives, (id. ¶ 12); the complexity of the asserted claims, (id. ¶ 13-14); the large number of claimants, (id. ¶ 15-16), and the fact that outside counsel was retained (id. ¶ 17). Not one of these purported reasons rationally supports Defendants burden to show that litigation was inevitable sufficient to shield the documents from disclosure as attorney work product. This Court squarely placed the burden on Defendants to justify their claims of privilege. Defendants revised privilege log served on November 27, 2007 offers no additional reasons why litigation was allegedly inevitable before Plaintiffs claims were ever considered. An objective fact-finder could not have determined whether Plan interests

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diverged with those of the plaintiffs until an analysis and determination on the appeal had been completed. Defendants had an obligation to consider Plaintiffs claims fairly and even handedly: While a fiduciary has a duty to protect the plan's assets against spurious claims, it also has a duty to see that those entitled to benefits receive them. It must consider the interests of deserving beneficiaries as it would its own. Gaither v. Aetna Life Ins. Co.,394 F.3d 792, 807-08 (10th Cir. 2004). Because the documents relate to plan administration including Plaintiffs claims and appeal, Defendants should be directed to disclose them. If the matter is unclear, the Court s in camera review of the subject documents will assist the inquiry. B. Earlier Plan Administration Documents Documents 43-46, 108-122 should be disclosed because they contain advice related

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to plan administration. Documents 43 through 46 appear to comment on implementation of amendments and legal and statutory compliance issues, which are matters of plan administration. See Mett, 178 F.3d at 1064. Documents in which counsel has reviewed and commented on . . . the plan s compliance with its statutory obligations are not privileged because they assist the fiduciaries with fulfilling their obligations. Fischel v. Equitable Life Assurance, 191 FRD 606, 610 (N.D. Cal. 2000) (granting motion to compel production of
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documents which related to the plan s compliance with its statutory obligations under the Internal Revenue Code. ). For example, Document 44, distributed to numerous employees, was dated February 10, 1984 and encloses the Draft Retirement Plan For Comment. Logic dictates that this document, which is dated six days after Defendants contend the 1984 Signal Retirement Plan amendments were signed on February 4, 1984, must relate to plan administration.8 Likewise, Document 43, which purports to be a 1989 Memo re:

Compliance and Plan Amendments, would, to the extent it addresses compliance, relate to matters of Plan administration. For example, the Plan administrator signs the Form 5500

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and files reports with the Internal Revenue Service and the Department of Labor. As the cited cases confirmed ordering disclosure of documents relating to a plan s compliance with its statutory obligations, tt is the plan administrator s duty to ensure the Plan complies with ERISA. Even assuming arguendo some Plan sponsor concerns were implicated in connection with documents 43-46, those concerns would be in addition to, and not to the exclusion of, matters concerning plan administration and the documents should be disclosed. Additionally, communicating to plan participants is a fiduciary function. Accordingly, several documents that related to communicating to participants are matters of plan administration and should be disclosed pursuant to the fiduciary exception to attorney client privilege. These include documents 108-122. See Fischel, 191 F.R.D. at 610 (granting motion to compel documents focused on word smithing and editing the

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language disclosing plan changes for the benefit of the beneficiaries and related to Documents prepared after a plan amendment certainly cannot be protected by a settlor function or plan design limitation on the fiduciary exception. Once an amendment has been adopted, fiduciary duties to implement the amendment and administer its terms attach. The responsibility of deciding whether plan amendments have been duly adopted and are consistent with ERISA s mandates involves the exercise of fiduciary responsibilities. Curtiss-Wright v. Schoonejongen, 514 U.S. 73, 82 (1995) (citing 29 U.S.C. § 1104(a)(1)(D)).
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documents that are intended to describe or communicate changes in plan benefits to beneficiaries.... ). In any event these documents were voluntarily disclosed to outside third parties representing the Plan. Any privilege regarding these documents was waived.9 See Section

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C below.

C.

All Claims of Privilege Were Waived Because All of the Documents Were Given to Plan Attorneys And Many Were Given to The Plan s Actuaries Defendants attempts to shield the requested documents on the ground that they are

privileged documents of the Plan sponsor fails. By providing the documents to outside counsel, Covington & Burling, Richard Shea and John Vine, among others, who advised the Plan fiduciaries with respect to Plaintiffs claims and appeal and by turning the same documents over to the Plan s actuaries, Honeywell waived any possible claim of privilege. The outside attorneys at Covington & Burling admit that they were retained by long term client Honeywell to provide advice and assistance to the Plan Administrator in drafting responses to Retirees administrative claims. (Shea Decl., Doc. 225, Exh. C ¶ 2.) Honeywell provided Covington lawyers with documents from prior counsel, including

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O Melveny and Myers documents and including documents from attorney David Gordon who admits that he was retained to provide advice regarding the Retirement Plan and that he circulated documents to the Plan s actuaries and consultants employed by Johnson & Higgins. (Doc. 225, Exh. G ¶ 4.) Any privileges regarding these documents were waived.

As an example, Document 43, created in 1989, contains Plan attorney Richard Shea s handwritten notes. Mr. Shea assisted the Plan in responding to Plaintiffs claims and appeal. Even if these were sponsor documents rather than plan documents giving the document to Mr. Shea, who counseled the Plan, waived the privilege.
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Disclosure and intermingling of communications between persons acting on behalf of the Plan with loyalties owed to Plan participants and those acting on behalf of the company waives any possible privilege.10 See Lewis, 203 F.R.D. 615, 623, finding that documents turned over to the attorneys responding to and providing advice on the plaintiffs claims waived the attorney client privilege: The Court finds Defendants have failed to establish they did not waive the attorney-client privilege when Morse sent the Plan Administrator documents reflecting Emails from legal defining officer to review in preparation for the Benefit Administrative Committee. Accordingly, the Court finds that the attorney-client privilege has been waived not only for those written communications explicitly sent to and from in-house counsel, human resource representatives of the company and the Plan Administrator, but also for those documents reflecting Emails from legal defining officer -because the substance of all of these otherwise privileged communications were intentionally disclosed to a third party. Id. See also Shields v. Unum Provident Corp., 2007 WL 764298, at *3 (S.D.Ohio 2007), holding that documents in the plan administrator s files that were turned over by the

Defendants also assert that part of the reason Covington & Burling lawyers were retained was to to provide advice to Honeywell regarding its potential liability, on Plaintiffs claims. (Shea Decl., Doc. 225, Exh. C ¶ 1.) Before the ruling on Plaintiffs administrative appeal, the interests of the Plan and its participants were in direct opposition to the interests of Honeywell as the Plan sponsor and entity responsible for funding the Plan. This would appear to be a nonwaivable direct conflict of interest under Rule 42, Arizona Rules of Professional Conduct, Rule 1.7 and similar rules. Given these facts, the best conclusion is that any documents shared with or created or reviewed by Covington & Burling during the claim and appeal process should only be shielded from disclosure to the Plan (i.e., to Plaintiffs) if they have nothing whatsoever to do with plan administration. Any documents that do deal with plan administration cannot be protected by merely because Covington claims that in addition to advising the Plan, it was advising the Plan sponsor. That would be the exception that would swallow the fiduciary exception to the attorney client privilege rule. All a company would have to do to avoid compliance with the fiduciary exception would be ask for advice from outside counsel retained to advise the plan. When Honeywell chose to share information with outside counsel retained to represent the Plan, its claim of privilege as Plan sponsor was waived.
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company to persons whose function was to advise the plan on matters of plan administration and respond to claims, waived the attorney client privilege: ...The Court concludes that the corporate defendants waived the attorney-client privilege when they disclosed the documents to the claims administrators. D. Defendants Also Fail to Meet Their Burden to Establish That Documents Distributed to or from Non-lawyers Are Privileged Defendants, also fail to meet their burden to establish a privilege for documents 10,

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31, 38, 41, 44, 101-105, 109, 111, 114, 116-120 . Work product protection does not apply to communications with non-lawyers, unless, at a minimum, the non-lawyer is working under the direct supervision of an attorney in anticipation of litigation. Hoptowit v. Ray, 682 F.2d 1237, 1262 (9th Cir. 1982); United States v. Ackert, 169 F.3d 136, 139-40 (2d Cir. 1999) (finding insufficient basis for concluding attorney client privilege applied to communications with accountant). See also Edna S. Epstein, The Attorney-Client Privilege and the Work Product Doctrine 134-43, 147-51 (4th ed. 2000). Defendants have failed to show that Plan actuary Kurt Denlinger and other Hewitt Associates employees including B. Rigby (identified by Defendants as Administrative

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Assistant, Hewitt Associates, New Jersey) and F. D Ariano (identified by Defendants as Consultant (and actuary), Hewitt Associates, New Jersey) were working under the direct supervision of a lawyer when 10, 38 and 101-10511 were created. The disclosure to these individuals waives the privilege with respect to these documents.

Document 10 was discussed as prior document number 13 in O Neill Decl., Doc. 225, Exh. B ¶ 25. It is also discussed as document number 13 Denlinger Decl., Doc. 225, Exh. D ¶ 2 (stating only that he kept document confidential). Document 38 was discussed as prior document number 57 in O Neill Decl., Doc. 225, Exh. B ¶ 23; Vine Decl. ¶ 7.
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For a corporation to establish that the attorney-client privilege applies, the corporation must show that the communications at issue are between corporate employees and counsel, made at the direction of corporate superiors in order to secure legal advice. United States v. Chen, 99 F.3d 1495, 1502 (9th Cir. 1996) (citing Upjohn Co. v. United States, 449 U.S. 383, 390-94 (1981)). Here, no such showing was made with respect to documents disclosed to the following individuals: Name Jean Payne Defendants Description of Job Function or Title Specialist in Honeywell s Human Resources Department Signal employee None Benefits Administrator, Garrett, Torrance, CA Personnel Administrative Associate, Honeywell Human Resources Generalist, AlliedSignal, Phoenix, AZ Documents or Advice Disclosed to Non-Lawyers 31, 41, 105, 109, 111, 114, 116-120 44 108 109 109 114

F. Morgan Sharon Himmele Margarit Prokopik Donna Forbes T. Goulet

Accordingly, Defendants have not established that documents 31, 41, 105, 109, 111, 114, 116-120 are privileged, and they should be disclosed.

CONCLUSION For the foregoing reasons, Plaintiffs respectfully request that Plaintiffs motion to compel disclosure of the documents listed on the attached Exhibit A be granted. Plaintiffs request such other and further relief as is equitable and just. Respectfully submitted this 4th day of December, 2007.
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MARTIN & BONNETT, P.L.L.C. By: s/Susan Martin Susan Martin Daniel L. Bonnett Jennifer L. Kroll 3300 North Central Avenue, Suite 1720 Phoenix, AZ 85012-2517 (602) 240-6900 Attorneys for Plaintiffs

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CERTIFICATE OF SERVICE I hereby certify that on December 4, 2007, I electronically transmitted the attached document to the Clerk s Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the Following CM/ECF registrants: David B. Rosenbaum Dawn L. Dauphine Osborn Maledon, P.A. 2929 North Central Ave., Suite 2100 Phoenix, AZ 85012-2794 Michael Banks Azeez Hayne Morgan Lewis & Bockius LLP 1701 Market Street Philadelphia, PA 19103 Howard Shapiro Proskauer Rose LLP 909 Poydras Street, Suite 1100 New Orleans, LA 70112 Amy Covert Proskauer Rose LLP One Newark Center, 18th Floor Newark , NJ 07102-5211 Christopher Landau Eleanor R. Barrett Kirkland & Ellis LLP 655 Fifteenth Street, N.W. Washington, D.C. 20005 Attorneys for the Defendants s/.J. Kroll
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