Free Response - District Court of Arizona - Arizona

Lydia A. Jones - 017178 ROGERS & THEOBALD LLP 2 The Camelback Esplanade, Suite 850 2425 East Camelback Road 3 Phoenix, Arizona 85016
4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

1

Telephone: (602) 852-5582 [email protected]

Attorneys for Plaintiffs UNITED STATES DISTRICT COURT ARIZONA DISTRICT KAYE HUTTON, as an individual and representative of a class consisting of others similarly situated, Plaintiff, vs. BANK OF AMERICA, N.A., Defendant.
Introduction

No. CV2003-2262-PHX-ROS PLAINTIFF'S RESPONSE MEMORANDUM TO DEFENDANT'S OPENING MEMORANDUM ON THE DISCOVERABILITY OF THE NOTES OF BARBARA DAVIS, ESQ.

The issue before this Court is whether four pages of notes taken by a now deceased law firm attorney during a telephonic meeting in May 2000 are discoverable by plaintiff. The defendant Bank argues that the notes are work product. Plaintiff submits that the Bank cannot satisfy its burden of proof. In any event, plaintiff has a substantial need for the notes, the equivalent of which cannot be obtained from the deceased author, or from other sources. Plaintiff further submits that she has a compelling need for the mental impressions and opinions within the notes that bear directly on the issue of wilfullness, including whether the Bank knew or should have known in 2000 that there was the possibility that the client manager position was misclassified and whether it was reasonable for the Bank to delay reclassification for over two years.

Case 2:03-cv-02262-ROS L:\20980.1\PLEA\200512161800.DOC

Document 199

Filed 12/16/2005

Page 1 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

Finally, because the question of work product is before this Court, plaintiff respectfully requests that this Court order an in camera inspection of the materials prior to making its decision. The Bank Has Not Demonstrated that the Notes are Work Product The Defendant Bank has the burden of proof that notes prepared in May 2000 by now deceased law firm attorney Ms. Davis are, and have remained, work product. Southern Union Co. v. Southwest Gas Corp., 205 F.R.D. 542, 549 (USDC Ariz. 2002). The burden of establishing work product "must be specifically raised and demonstrated, rather than asserted in a blanket fashion." Id. Whether a document constitutes work product depends on several independent and exclusive conditions. First, the document must have been "prepared in anticipation of litigation." Southern Union Co. v. Southwest Gas Corp., 205 F.R.D. 542, 548 (2002) (citing Hickman v. Taylor, 329 U.S. 495 (1947)). Second, as your Honor held in Southern Union Co. v. Southwest Gas Corp., 205 F.R.D. 542, 549 (2002) and in Yurick v. Liberty Mutual Insurance Co., 201 F.R.D. 465, 472-473 (2001), there must be a nexus between the claimed work product document, on the one hand, and the anticipated litigation against the party seeking the document, on the other hand. Southern Union Co., 205 F.R.D. at 549 (holding that although at the time the claimed work product documents were drafted litigation against the party seeking the documents may have been anticipated, "what is missing, however, is the nexus between the documents and the anticipated litigation before the ACC and possibly with Southern Union") (italics in the original); Yurick v. Liberty Mutual Insurance Co., 201 F.R.D. 465, 472-473 (USDC Ariz. 2001) (holding that documents constituted work product because they were prepared by in anticipation of potential litigation against the plaintiff Ms. Yurick, although

Case 2:03-cv-02262-ROS

Document 199

2Filed 12/16/2005

Page 2 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

ultimately allowing discovery of the claimed work product under permissible disclosure of opinion work product analysis.) Third, work product protections must be preserved, and not waived, by the author of the work product. Southern Union Co., 205 F.R.D. at 549 (finding that voluntary disclosure of the claimed work product to a third party where no common adversary interest was established constituted waiver of work product). Fourth and finally, documents prepared in the ordinary course of business prior to the commencement of litigation are not work product. Southern Union Co., 205 F.R.D. at 549; Yurick, 201 F.R.D. at 472. Here, the defendant Bank claims that the notes are work product because when Ms. Davis prepared the notes in May, 2000, she was outside counsel representing the Bank in litigation pending in California. [Def. Memo, p. 3, ll 16-17.] The defendant Bank does not, however, argue, let alone satisfy the burden of proof articulated in Southern Union Co., that Ms. Davis prepared the notes in anticipation of litigation against the Bank by plaintiff Ms. Hutton. Further, the four pages of notes at issue concern State of Washington Client Managers. Yet, similar to the party claiming work product in Southern Union Co. v. Southwest Gas Corp., the Bank does not (and cannot) demonstrate the requisite nexus between: (i) the preparation of notes by Ms. Davis concerning State of Washington Client Managers during the pendancy of California litigation, on the one hand; and (ii) an anticipation of defending the Bank in any future litigation, including for example in an Arizona action instituted against it by Ms. Hutton, on the other hand. Finally, the Bank does not mention, nor satisfy, its burden of proof that work product protections, if any, were not waived.1
1

The Bank admits that Ms. Davis' law firm voluntarily disclosed the notes to a paralegal in North Carolina working for the Bank. The Bank also admits that it then voluntarily disclosed the notes to its counsel in

Case 2:03-cv-02262-ROS

Document 199

3Filed 12/16/2005

Page 3 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

The notes are not work product and consequently should be produced in their entirety to Ms. Hutton. Work Product is Discoverable under Federal Rules of Civil Procedure 26(b)(3) Even if the Bank could demonstrate that Ms. Davis' notes were prepared in anticipation of litigation, and even if the Bank could demonstrate that there is a nexus between the preparation of the notes and such litigation, and finally even if the Bank could demonstrate that work product protections, if any, have not been waived by voluntary disclosures or otherwise, Ms. Davis' work product is in any event discoverable under your Honor's ordinary work product and opinion work product analysis of Federal Rules of Civil Procedure Rule 26(b)(3). Under Rule 26(b)(3), work product is discoverable upon a showing that the party seeking discovery has substantial need for the materials in the preparation of the party's case and that the party is unable without undue hardship to obtain the substantial equivalent of the materials by other means. See Fed. R. Civ. P. 26(b)(3). There are two types of work product recognized by Rule 26(b)(3). One type is "ordinary work product," and it includes facts, objective statements, and the reporting or memorialization of facts, objective statements, and other data points. See, e.g., Southern Union Co., 205 F.R.D. at 549; Yurick, 201 F.R.D. at 472. The second type is "opinion work product," and it includes mental impressions, conclusions, opinions, or legal theories of an attorney or other representative. See Southern Union Co., 205 F.R.D. at 549; Yurick, 201 F.R.D. at

Arizona. [Def. Memo, p.2, ll. 8-11; Affidavit of Charles Chester dated November 28, 2005.] Under Southern Union v. Southwest Gas Corp., the Bank has the burden of proof to demonstrate that these disclosures, and any other disclosures, did not result in the waiver of work product. Further, if Ms. Davis disclosed the notes to a third party before her death, or if Ms. Davis' law firm (or the Bank for that matter) disclosed the notes to a third party, including any of their respective insurance carriers or their respective experts, consultants, or other service providers, then the work product may have been waived. Defendants do not address waiver, and consequently have not satisfied the burden of proof that the claimed work product was not waived. See Southern Union Co., 205 F.R.D. at 549.

Case 2:03-cv-02262-ROS

Document 199

4Filed 12/16/2005

Page 4 of 11

1 2 3 4 5 6 7 8 9 10 11 12

472. As the Court is aware, if there is a substantial need for ordinary work product, and the party seeking the ordinary work product cannot obtain the substantial equivalent of it without undue hardship, then ordinary work product is properly discoverable. Southern Union Co., 205 F.R.D. at 549; Yurick, 201 F.R.D. at 472. Further, where mental impressions are at issue in a case and the need for the material is substantial and compelling, then opinion work product is properly discoverable as well. Yurick, 201 F.R.D. at 472. As demonstrated below, the evidence supports the disclosure of any ordinary work product and opinion work product that this Court may determine exists.
1. Ordinary Work Product

Ordinary work product is discoverable upon a showing by the party seeking the discovery of a substantial need for the material in the preparation of the case and
13

an inability to obtain the substantial equivalent of the materials without undue
14

hardship. Federal Rules of Civil Procedure, Rule 26(b)(3); Southern Union Co., 205
15

F.R.D. at 549; Yurick, 201 F.R.D. at 472.
16

Plaintiff has a substantial need for this material in the preparation of the
17

plaintiff's wilfullness claim. As the Court may recall from plaintiff's Motion to
18

Expand, a determination of wilfullness depends on what the Bank knew, and what
19

the Bank should have known, regarding the possibility that the client manager
20

position may have been misclassified as exempt prior to the event of reclassification
21

in March 2002.
22

The notes at issue memorialize a conversation in May 2000 in which the
23

Bank's expert/consultant advised the Bank that it might want to reexamine the
24

exempt/nonexempt status of the client manager position, and that it might want to
25 26

Case 2:03-cv-02262-ROS

Document 199

5Filed 12/16/2005

Page 5 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

perhaps even make some changes to the exempt status.2 Clearly, Ms. Davis' notes taken during this conversation will reflect what the Bank knew or should have known regarding exemption status given the advice of its expert/consultant, and as such they are needed in the preparation of plaintiff's claim of wilfullness. In any event, plaintiff has a substantial need for the information since it is the only contemporaneous recording of the advice the Bank's paid expert/consultant provided on the issue of whether the client manager position may have been misclassified as exempt, and somewhat more importantly, it is the only contemporaneous recording of what the Bank should have reasonably been aware of regarding the exemption status of the client manager position.3 Finally, plaintiff cannot obtain the substantial equivalent of the information contained in the four pages of Ms. Davis notes. Ms. Davis is deceased and plaintiff would not be able to obtain the substantial equivalent of Ms. Davis' notes from the other participants on the call, since present recollections of an event from over five and one-half years ago is not substantially equivalent to the written notes made contemporaneously with the call.

See Aubry Affidavit, ¶¶ 8, 14, attached to Defendant's Response to Plaintiff's Motion to Proceed. Defendants are correct that Mr. Aubry made notes during the May 2000 conversation. The Aubry notes, however, do not record what the Bank (and its attorneys) was told, or record what the Bank (and its attorneys) should have reasonably been aware regarding the exempt status of client managers. In fact the notes are of little value, given that they consist of a date, a list of participants, and only 9 lines of text, four of which list names of two bank employees, three of which state that the bank is "getting legal challenges and is looking at the exempt/nonexempt status," and remaining two of which state the words "Banking Center/branch" and "outside sales exemption." See Ex. D to Aubry Aff.
3

2

Case 2:03-cv-02262-ROS

Document 199

6Filed 12/16/2005

Page 6 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26
4

In a final effort to deny plaintiff ordinary work product that would substantially support plaintiff's claim of wilfullness, defendant, relying on Navajo Nation v. Norris, 331 F.3d 1041 (9th Cir. 2003), argues that plaintiff cannot demonstrate an inability to obtain the ordinary work product that may be in Ms. Davis' notes. It is not readily apparently, however, how defendant's analysis of Navajo Nation is applicable or helpful here. Specifically, defendant misstates the issue before the Court in Navajo Nation. Contrary to Def. Memo., p. 5, ll 18-19, the issue in Navajo Nation was whether the lower court's lack of a ruling on a motion to compel documents relating to a calendar date warranted reversal of that court's entry of summary judgment on the issue of domicile.4 In any event, in Navajo Nation, the 9th Circuit considered anew the merits of the motion to compel where the moving party sought material in possession of an adoption attorney to challenge two declarations, one of the attorney and the other of the attorney's client's (the Becentis). The challenges related to the topic of a calendar date, the timing of the initial contact between the adoption attorney and his/her clients, the Becentis. Navajo Nation, 331 F.3d at 1045-1046. Noting that the factual inquiry of a date is readily obtainable from one (and presumably both) of the declarants, the 9th Circuit held that the lower court's lack of a

The 9th Circuit did not, as defendant suggests at Def. Memo p. 5, ll 18-19, hold that the District Court did not commit reversible error by declining to order the production of the claimed work product. The lower court did not even consider the motion to compel, let alone decline to order production. Navajo Nation, 331 F.3d at 1046.

Case 2:03-cv-02262-ROS

Document 199

7Filed 12/16/2005

Page 7 of 11

1 2 3

ruling on the motion to compel regarding a date did not warrant reversal of the entry of summary judgment on the issue of domicile. Navajo Nation , 331 F.3d at 1046. Unlike in Navajo Nation, here, any factual statements recorded by Ms. Davis

4 5 6 7 8 9 10 11 12 13 14

are not readily obtainable from her because she is deceased. Further, the substantial equivalent of such facts are not readily obtainable from Mr. Aubry as suggested by the Bank, since questions posed now to Mr. Aubry about a conversation nearly 5 and ½ years ago is no way near, and consequently does not constitute, the substantial equivalent of the facts as recorded by Ms. Davis during the call. There is no substitute for Ms. Davis' notes. They are the only contemporaneous written memorialization of what the Bank was told, and more importantly, what the Bank's attorney believed the Bank was being told, about the exempt/nonexempt status of the client manager position.

15 16 17 18 19 20 21 22 23 24 25

2.

Opinion Work Product

Opinion work product is discoverable and admissible when mental impressions are at issue in a case and the need for the material is compelling. Yurick, 201 F.R.D. at 472 (citing Holmgren v. State Farm Mutual Auto. Ins. Co., 976 F2d 573, 577 (9th Cir.). In Yurick, your Honor examined whether opinion work product was discoverable in an action for bad faith and held that if the plaintiff could establish a substantial need, then the mental impressions, opinions, and legal theories of a both retained counsel and in-house counsel would be discoverable because:

26

Case 2:03-cv-02262-ROS

Document 199

8Filed 12/16/2005

Page 8 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

the strategy, mental impressions, and opinion of Retained Counsel and House Counsel ... concerning the handling of the Yurick settlement .... are directly at issue in Plaintiff's bad faith action. Yurick, 201 F.R.D. at 473. With respect to Ms. Davis' opinion work product, similar to the facts and circumstances in Yurick, here, the strategy, mental impressions, and opinion of retained counsel Ms. Davis relating precisely to what the Bank was being told, and what the Bank should have reasonably understood it was being told, is directly related to the plaintiff's claim of wilfullness. Wilfullness is demonstrated by what the Bank knew or should have known in 2000, and whether it recklessly disregarded the possibility that at that time the client manager position was not exempt from overtime. 29 C.F.R. 578(c)(3). In addition, an employer's conduct is deemed wilfull or reckless where the "employer should have inquired further into whether its conduct was in compliance with the Act and failed to make adequate further inquiry." 29 C.F.R. 578.3(c)(1). Under Ninth Circuit case law, the wilfullness standard is met where the employer disregarded the possibility that it was violating the FLSA. See Alvarez v. IBP, Inc., 339 F.3d 894, 908-09 (9th Cir. 2003). And other jurisdictions have found wilfullness where the employer waited two years after being on notice of possible FLSA violations, to implement a corrective plan, and when it did, it failed to implement it retroactively. See Huss v. City of Huntington Beach, 317 F. Supp. 1151, 1161 (C.D. Calif. 2000). What Ms. Davis' recorded in her four pages of notes while the Bank was being told by its paid consultant that it might want to reexamine the exempt/ nonexempt status of the client manager position, and that it might want to perhaps even make some changes to the exempt status of the client manager position, [see Aubry Aff. ¶¶ 8, 14], bears directly on what the Bank knew, and should have known,
Document 199

Case 2:03-cv-02262-ROS

9Filed 12/16/2005

Page 9 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26

and consequently whether the Bank engaged in wilfull conduct. In addition, Ms. Davis' impressions and opinions bear directly on whether the Bank disregarded the possibility that the client manager position was misclassified in 2000. Finally, Ms. Davis' impressions and opinions that she had as the Bank's attorney and agent in May 2000, are highly relevant to whether the Bank, having heard the same information, acted reasonably in waiting for over two years before implementing overtime compensation for the client manager position, and even then, failing to pay overtime compensation retroactively. Where as here, there is a substantial and compelling need for the materials and the materials are directly related to the issue of wilfullness, the Court should allow discovery of any opinion work product it determines exists in the notes. Federalism and California Law As the Court noted on the record on November 9, 2005, the applicable law is federal law, and such the Court will preserve federal privilege, regardless of state law, including California state law. Defendant's Memorandum in any event misstates California law, since even under that state law, mental impressions and opinions are discoverable in certain circumstances. In addition, the policy concerns of preserving the confidentiality of attorney work product and diminishing its use in other cases raised by the defendant are easily cured with a standard protective order, which this Court may so issue in connection with the release of the notes to plaintiff.

Case 2:03-cv-02262-ROS

Document 199

Filed 12/16/2005 10

Page 10 of 11

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22

Conclusion For the reasons stated above, plaintiff respectfully requests that this Court order an in camera inspection of the notes at issue, and thereafter, order the disclosure of the notes to plaintiff. In particular, the Court should order the

disclosure of the ordinary work product because there is a need for that information and plaintiff cannot obtain it without undue hardship. Finally, because there is a substantial and compelling need for the mental impressions and opinions of Ms. Davis that are central of the plaintiff's claim of wilfullness, the Court should order the disclosure of the opinion work product as well. DATED this 16th day of December, 2005. ROGERS & THEOBALD LLP By /s/ Lydia A. Jones Lydia A. Jones The Camelback Esplanade, Suite 850 2425 East Camelback Road Phoenix, Arizona 85016 Telephone: (602) 852-5582 Attorneys for Plaintiffs I hereby certify that on this 16th day of December, 2005, I electronically transmitted 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: Charles L. Chester, Esq. John M. Fry, Esq. Ryley Carlock & Applewhite One North Central Avenue, Suite 1200 Phoenix, AZ 85004-4417 Attorneys for Defendant Bank of America, N.A.

And a courtesy copy hand-delivered to: Honorable Roslyn O. Silver 24 United States District Court Sandra Day O'Connor U.S. Courthouse, Suite 624 25 401 West Washington Street, SPC 59 Phoenix, AZ 85003-2158 26 By /s/ Lydia A. Jones
23

Case 2:03-cv-02262-ROS

Document 199

Filed 12/16/2005 11

Page 11 of 11