United States District Court, E.D. Pennsylvania
JACOBY DONNER, P.C.
ARISTONE REALTY CAPITAL, LLC, et al.
J. RUETER UNITED STATES MAGISTRATE JUDGE.
Orders dated May 16, 2018, see Docs. 64 and 65, the
court granted in part and denied in part plaintiff's
Motion to Compel Discovery from Defendant Aristone Realty
Capital, LLC (Doc. 50) and plaintiff's Motion to Compel
Discovery from Third-Party Eric Diaz and for Sanctions (Doc.
51). In the May 16, 2018 Orders, the court deferred ruling on
plaintiff's request for all settlement agreements,
including all drafts, between Eric Diaz and defendant
Aristone Realty Capital, LLC (“Aristone”), and
all communications after April 6, 2016, between Diaz and/or
his counsel and Aristone and/or its counsel, relating to the
intended settlement agreements between Diaz and Aristone.
court has reviewed the parties' letter briefs on this
issue. In their letters to the court, Aristone and Diaz
oppose plaintiff's request for discovery because (1) they
claim the draft settlement agreements constitute privileged
attorney work product; (2) the materials are not relevant;
and (3) they are confidential. For the reasons that follow,
the court rejects these objections to plaintiff's
requests and will order Aristone and Diaz to produce these
materials as requested in the Request for Production of
Documents and the third-party subpoena.
action was commenced by plaintiff, Jacoby Donner, P.C., a
Philadelphia law firm, against Aristone to collect attorney
fees owed for services rendered primarily by Diaz when he was
employed as an attorney by plaintiff. The amount owed to
plaintiff is in excess of $750, 000. Diaz is no longer
employed by plaintiff and is now associated with another law
firm and continues to represent Aristone. In defense of the
debt collection action, Aristone has counterclaimed against
plaintiff, alleging that Diaz and others in the Jacoby Donner
law firm committed malpractice, and that plaintiff is liable
on the basis of respondeat superior.
and Diaz first object to the production on the basis of the
work product doctrine. The work product doctrine is governed
by federal law pursuant to Fed.R.Civ.P. 26(b)(3). See
Dietz & Watson, Inc. v. Liberty Mut. Ins. Co., 2015
WL 356949, at *7 (E.D. Pa. Jan. 28, 2015) (under the work
product doctrine, a party ordinarily may not discover
documents and tangible things that are prepared in
anticipation of litigation or for trial by or for another
party or its representative). Here, Aristone and Diaz have
failed to satisfy their burden of demonstrating that the
drafts of the settlement agreement were prepared in
anticipation of litigation or for trial. See Bradfield v.
Mid-Continent Cas. Co., 15 F.Supp.3d 1253, 1256 (M.D.
Fla. 2014) (“Plaintiffs have failed to offer any
explanation as to how drafts of settlement and mediation
agreements were prepared ‘in anticipation of
litigation.'”); Redding v. ProSight Specialty
Mgmt. Co., Inc., 2014 WL 11412743, at *6 (D. Mont. July
2, 2014) (“the Court doubts whether this document [, an
email exchange between counsel discussing how to allocate the
global settlement among the multiple claimants, ] was
prepared in anticipation of litigation or for trial, since it
clearly was prepared in anticipation of settlement”).
each of Aristone and Diaz has waived the work product
privilege because each party disclosed the disputed materials
to an adversary. See Westinghouse Elec. Corp. v. Republic
of Philippines, 951 F.2d 1414, 1428-29 (3d Cir. 1991)
(holding that Westinghouse's disclosure of work product
to two adversaries waived the work-product doctrine as
against all other adversaries); see also Frankford Tr.
Co. v. Advest, Inc., 1995 WL 491300, at *1-2 (E.D. Pa.
Aug. 17, 1995). It is clear that, for purposes of this
litigation, Aristone and Diaz are adverse to one another.
Although Aristone has not joined Diaz as an indispensable
third-party in this case to date, Aristone, as counterclaim
plaintiff, filed a motion for leave to amend its claims to
add Diaz as a counterclaim defendant. See Doc. 53.
the court finds that the drafts of the settlement agreement,
and communications relating thereto, are relevant to
plaintiff's claim that Aristone and Diaz are colluding
with one another to evade plaintiff's collection action.
See Dietz & Watson, Inc., 2015 WL 356949, at *9
(permitting insurance company to obtain discovery of
settlement discussions between plaintiff and its insured to
show collusion between the two to obtain payment from
insurance company). The court further notes that a settlement
agreement may be discoverable even if it is confidential.
See Key Pharm., Inc. v. ESI-Lederle, Inc., 1997 WL
560131, at *2 (E.D. Pa. Aug. 29, 1997) (the party seeking
discovery of a confidential settlement agreement has the
burden to make a particularized showing that the documents
relating to the settlement negotiations are relevant and
likely to lead to the discovery of admissible evidence)
(citing Fidelity Fed. Sav. and Loan Ass'n v.
Felicetti, 148 F.R.D. 532, 534 (E.D. Pa. 1993); Doe
v. Methacton Sch. Dist., 164 F.R.D. 175, 176 (E.D. Pa.
1995)). See also Bd. of Trustees of Leland Stanford
Junior Univ. v. Tyco Int'l Ltd., 253 F.R.D. 521, 523
(C.D. Cal. 2008) (there is no federal privilege preventing
the discovery of settlement agreements and related
documents). Here, plaintiff has made such a showing. Aristone
alleges that plaintiff committed malpractice. The draft
settlement agreement, and communications related thereto
between Aristone and Diaz, are clearly relevant to whether an
attorney in plaintiff's employ committed malpractice in
its representation of Aristone.
it is hereby
within fourteen (14) days of the date hereof, Aristone and
Diaz each shall comply with plaintiff's requests for
production of documents and third party subpoena and produce
all settlement agreements, including all drafts, and all
communications between Aristone and Diaz and/or his counsel
and Aristone and/or its counsel ...