[EDRM Editor’s Note: The opinions and positions are those of Michael Berman.]
GLD3, LLC v. Albra, 2024 WL 4471672 (S.D.N.Y. Oct. 11, 2024), involved a request for discovery from a former Town attorney concerning an offer that he allegedly made to plaintiffs. The defendants, a Town and others, denied knowledge of the alleged offer.
The court: set out the governing standard for discovery from an attorney and, denied a request to depose the attorney; but, authorized a limited interrogatory to him.
The plaintiffs wanted to develop certain property that they owned. However, an archeological investigation revealed a Revolutionary War burial area in one corner. The court wrote: “Plaintiffs still planned to develop the property but planned to preserve the burial area, provide public access to it, and place a marker honoring ‘the fallen Revolutionary War soldiers and those who continue to serve this great nation.’”
The plaintiffs later filed applications for water and sewer services. The Town offered approval if the plaintiffs donated the burial area to the Town. The plaintiffs refused and the application was denied.
The plaintiffs filed a challenge to the denial. The court explained: “Shortly thereafter, Plaintiffs allege that the Town Attorney (Brian Nugent) contacted them and offered to get their water and sewer rights application approved in exchange for the burial area and a promise that Plaintiffs do not develop any part of their land for another 10 years.” This was called the “quid pro quo offer.” The plaintiffs again refused.
The court summarized the factual dispute over the alleged offer: “When deposed about whether he instructed the Town Attorney to make this offer to Plaintiffs, Town Supervisor Albra denied any knowledge of the offer.”
In response, the plaintiffs moved to compel production of documents and communications between the Town and the former Town attorney (Mr. Nugent) related to the water and sewer application and the alleged quid pro quo offer. They also sought the former attorney’s deposition regarding the alleged offer.
The court reviewed the documents in camera, holding that some were privileged and some were not. It ordered production of Mr. Nugent’s handwritten notes of the conversation with a minor redaction.
When it came to the request for a deposition, the court wrote:
Lastly, Plaintiffs request a deposition of former Town Attorney Nugent in connection with his role in making the alleged quid pro quo as outlined in Plaintiffs’ motion papers. While obtaining discovery from opposing counsel is disfavored…, that the proposed deponent is a lawyer does not automatically insulate him or her from a deposition…. Indeed, the request to depose a party’s attorney must be weighed by balancing, generally speaking, the necessity for such discovery in the circumstances of the case against its potential to oppress the adverse party and to burden the adversary process itself…. To that end, the Friedman Court laid out the following factors to consider in assessing whether to permit the deposition of an opposing counsel: 1) the need to depose the lawyer; 2) the lawyer’s role in connection with the matter on which discovery is sought and in relation to the pending litigation; 3) the risk of encountering privilege and work product issues, and; 4) the extent of discovery already conducted. [emphasis added; citations and quotations omitted].
GLD3, LLC v. Albra, 2024 WL 4471672 (S.D.N.Y. Oct. 11, 2024).
Applying the first factor, the court found that the plaintiffs had already tried to obtain the same quid pro quo information from other sources: “Plaintiffs have already deposed the Town Board member who allegedly made the initial offer and the Town Supervisor, who denied telling Mr. Nugent to make such an offer.” Further it found the information about the offer to be plainly relevant.
Analyzing the second factor, the court noted that, although, depositions of counsel are disfavored, Mr. Nugent was no longer the Town attorney and was not counsel of record. No ongoing attorney-client relationship would be impacted.
Thus, those two factors weighed in favor of a deposition.
The court then added: “But the third factor favors denying the deposition, as there is a non-negligible ‘risk of encountering privilege and work-product issues.’” [citation omitted]. It continued: “[D]eposing Mr. Nugent on conversations he had with the Town Supervisor would likely generate many privilege objections, as the attorney-client privilege could cover many of the topics the two discussed. And unlike some of the cited cases here, Plaintiffs do not provide assurances in their papers that they would only be seeking non-privileged material.”
As to the final consideration, it added: “Lastly, the fourth factor similarly favors disallowing the deposition. ‘Courts are often less likely to grant discovery against opposing counsel where the parties have already engaged in significant discovery.’” [citation omitted].
Thus, the four-factor test required balancing two factors in favor of permitting a deposition and two factors against it. In balancing the competing factors, the court wrote:
But the Court is mindful that the allegations regarding the quid pro quo, which are central to Plaintiffs’ case, directly implicate a conversation Mr. Nugent had with plaintiffs’ counsel. And the Court separately ruled that the notes taken by Mr. Nugent in connection with that phone call must be produced, though in slightly redacted form. Indeed, Mr. Nugent’s testimony about what was said in this conversation would not be privileged, but any conversations he had with the Town Supervisor about it would likely veer quickly into privileged territory. [emphasis added].
Id.
The court then fashioned a middle-of-the-road remedy:
[T]he Court will permit Plaintiffs to serve an interrogatory on Mr. Nugent limited to (1) what was said in his phone conversation with plaintiffs’ counsel about the alleged quid pro quo offer; (2) who, if anyone, told him to make such an offer; and (3) whether and when the offer was communicated to the Town Supervisor. In this Court’s view, the identity of the person who directed that the offer be made to Plaintiffs should not be shielded by privilege just because a lawyer may have been used to communicate it. This will allow Plaintiffs to obtain relevant discovery but avoid the risks inherent with depositions of attorneys discussed above.
Id.
It added a warning: “And for his part, Mr. Nugent must be forthcoming in his answers or risk being deposed.”
[T]he Court will permit Plaintiffs to serve an interrogatory on Mr. Nugent limited to (1) what was said in his phone conversation with plaintiffs’ counsel about the alleged quid pro quo offer; (2) who, if anyone, told him to make such an offer; and (3) whether and when the offer was communicated to the Town Supervisor. In this Court’s view, the identity of the person who directed that the offer be made to Plaintiffs should not be shielded by privilege just because a lawyer may have been used to communicate it. This will allow Plaintiffs to obtain relevant discovery but avoid the risks inherent with depositions of attorneys discussed above…And for his part, Mr. Nugent must be forthcoming in his answers or risk being deposed.
GLD3, LLC v. Albra, 2024 WL 4471672 (S.D.N.Y. Oct. 11, 2024) (emphasis added; citations and quotations omitted].
The GLD3 decision does not discuss whether the quid pro quo offer, if any, was an inadmissible settlement proposal. See Fed.R.Evid. 408(a)(“Evidence of [a statement made during compromise negotiations about the claim] is not admissible – – on behalf of any party – -… to impeach by a prior inconsistent statement or a contradiction”).
The 2006 Committee Note to that Rule states: “The amendment prohibits the use of statements made in settlement negotiations when offered to impeach by prior inconsistent statement or through contradiction. Such broad impeachment would tend to swallow the exclusionary rule and would impair the public policy of promoting settlements.”
The GLD3 plaintiffs asserted due process and equal protection claims in connection with the decisions precluding development of their property. The court wrote that, shortly after the first denial, and also after plaintiffs filed an “Article 78” challenge, “Plaintiffs allege that the Town Attorney (Brian Nugent) contacted them and offered to get their water and sewer rights application approved in exchange for the burial area and a promise that Plaintiffs do not develop any part of their land for another 10 years.” [emphasis added]. Plaintiffs “again rejected this offer.” That may arguably be an inadmissible Rule 408(a) offer.
However, the court, with its greater knowledge of the case and issues presented, determined that the conversations were “central” and “relevant.”[1]
Notes
[1] This blog generally deals with ESI and ESI does not appear to have been at issue in GLD3. However, the scope of discovery and privilege analysis is generic and applicable to ESI.
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