Behunin v. Superior Court of Los Angeles County , 215 Cal. Rptr. 3d 475 ( 2017 )

Filed 3/14/17
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SEVEN
NICHOLAS BEHUNIN, B272225
Petitioner, (Los Angeles County
Super. Ct. Nos. BC573709
v. and BC574505)
THE SUPERIOR COURT OF LOS
ANGELES COUNTY,
Respondent;
CHARLES R. SCHWAB et al.,
Real Parties in Interest.
ORIGINAL PROCEEDING in mandate. John P. Doyle,
Judge. Petition denied.
Harder Mirell & Abrams, Douglas E. Mirell; Elkin Gamboa
& Ashkinadze and Regina Ashkinadze for Petitioner.
No appearance for Respondent.
Allen Matkins Leck Gamble Mallory & Natsis and Robert
Moore for Real Party in Interest Charles R. Schwab.
Law Offices of David H. Schwartz, Inc., David H. Schwartz;
Law Offices of Michael Stepanian and Michael Stepanian for
Real Party in Interest Michael Schwab.
INTRODUCTION
This action arises out of a lawsuit by Nicholas Behunin
against Charles Schwab and his son Michael Schwab over an
unsuccessful real estate investment deal. As part of a plan to
induce the Schwabs to settle the lawsuit, Behunin’s attorneys,
Leonard Steiner and Steiner & Libo, engaged a public relations
consultant, Levick Strategic Communications, to create a website
containing information linking the Schwabs and their real estate
investments in Indonesia to the family of former Indonesian
dictator Suharto. In Charles Schwab’s subsequent action against
Behunin for libel and Michael Schwab’s subsequent action
against Behunin for libel, slander, and invasion of privacy,
Behunin filed a special motion to strike under Code of Civil
Procedure section 425.16. In response to that motion, the
Schwabs sought discovery of communications among Behunin,
Steiner, and Levick relating to the creation of the website and its
contents. Behunin objected, claiming the communications were
protected from disclosure by the attorney-client privilege.
The questions in this proceeding are whether the
communications among Behunin, Steiner, and Levick were
confidential, attorney-client privileged communications and
whether disclosure to Levick waived the privilege. We conclude
that, although in some circumstances the attorney-client
privilege may extend to communications with a public relations
consultant, it did not do so in this case because Behunin failed to
prove the disclosure of the communications to Levick was
reasonably necessary for Steiner’s representation of Behunin in
his lawsuit against the Schwabs. Therefore, we deny Behunin’s
petition for a writ of mandate.
2
FACTUAL AND PROCEDURAL BACKGROUND
A. Behunin’s Lawsuit Against the Schwabs
Behunin, represented by Steiner, filed an action against the
Schwabs relating to a business dispute over the creation and
funding of a company called Sealutions, which Behunin and a
business partner formed “to pursue environmentally conscious
real estate investment and development,” and a related real
estate investment fund. Behunin alleged that to help establish
the fund he and Michael Schwab pursued a relationship with the
family of Suharto. Behunin asserted various causes of action,
including fraud and breach of contract, relating to the Schwabs’
purported promises to fund Sealutions. Behunin also described
the details of the Schwabs’ alleged relationship with members of
the Suharto family.
After filing the Sealutions lawsuit, Steiner hired Levick to
create a social media campaign to induce the Schwabs to settle
the case. As part of this strategy, Levick created a website,
www.chuck-you.com, linking the Schwabs to corruption, human
rights violations, and atrocities associated with Suharto and his
family. In a letter to Steiner and Behunin, a senior vice
president at Levick stated: “Per our discussion with your client,
Nicholas Behunin, LEVICK’s goal will be to develop and deploy
strategy and tactics of Mr. Behunin’s legal complaint.” The rest
of the letter is redacted.1
1 The record contains an unredacted version of what appears
to be a different draft of the same letter. The unredacted version
outlines the work Levick was going to perform, provides Levick’s
fee structure, and notes that all of Levick’s work product,
3
According to Behunin, “Steiner played no role in the
creation or publication of [the chuck-you.com website]. . . . [T]hat
website and the content contained in the website were created by
me and a public relations firm with which I was working.
Steiner’s only role was, at my specific request, to enter into a
contract on my behalf with that public relations firm in
connection with the prosecution of the [Sealutions action]. . . .
Steiner merely acted as a liaison between myself and the public
relations firm without knowledge of or connection to the
substance of the website. The website always has been and
remains my sole and exclusive property.” Behunin also stated in
a subsequent declaration the parties intended that all
communications among Behunin, Steiner, and Levick would be
protected by the attorney-client privilege and “all documents
prepared on [Behunin’s] behalf would be protected by the work-
product privilege unless and until they entered the public
domain.”
B. The Schwabs’ Defamation Actions Against Behunin
and Steiner
The Schwabs each filed an action against Behunin and
Steiner. Charles Schwab asserted a cause of action for libel and
alleged Steiner created and registered the “chuck-you.com”
website. Charles Schwab further alleged he is informally known
as Chuck, and the name of the website is a play on the words
“fuck you.” Charles Schwab also alleged the website “stole the
design and format of Charles Schwab & Co., Inc.’s investment
services website ‘www.schwab.com’ and then replaced its content
including the website, “shall be the sole and exclusive property of
Behunin.”
4
with numerous false, misleading, and libelous statements about
[Charles] Schwab. The entire Website was dedicated to trying to
smear [Charles] Schwab’s reputation by falsely associating him
with infamous Indonesian dictator Suharto and the atrocities
committed by his regime.”
Michael Schwab asserted causes of action for libel, slander,
and invasion of privacy and alleged the statements on the
website “attempted to smear [him] by associating him with
Tommy Suharto, a son of the former Indonesian dictator [who]
also has been linked to corrupt activities and is a convicted
murderer.” Michael Schwab further alleged the website falsely
suggested the Schwabs were doing business with the dictatorial
regime in Indonesia through the surviving members of Suharto’s
family, some of whom have been convicted of murder, bribery,
and seizing land by force.
C. Behunin’s Special Motion To Strike the Schwabs’
Complaints, the Court’s Discovery Order, and the
Ensuing Discovery Dispute
Behunin filed a special motion to strike the Schwabs’
defamation complaints under Code of Civil Procedure section
425.16. He argued the purpose of the Schwabs’ lawsuits was to
inhibit his constitutionally-protected petitioning activity of filing
the Sealutions lawsuit against the Schwabs. Behunin’s
supporting declaration provided the details of extensive
communications among Behunin, Michael Schwab, Charles
Schwab, and various members of the Suharto family.
In response to the special motion to strike, the Schwabs
filed motions for limited discovery under Civil Procedure Code
5
section 425.16, subdivision (g),2 seeking to take discovery on the
malice element of their defamation causes of action in connection
with the statements on the website. The Schwabs sought to
depose and obtain documents from Steiner, Behunin, and Levick
regarding communications among the three of them relating to
the website.
The trial court ruled the Schwabs were entitled to some of
the discovery they sought in order to oppose the special motion to
strike. In particular, the court allowed Michael Schwab to serve
a set of requests for production of documents on Steiner & Libo, a
subpoena for a deposition and documents on Levick, and a
business records subpoena on Bruce Fein, an attorney in
Washington, D.C.3 The court gave Charles Schwab permission to
depose Steiner and Behunin and serve a subpoena for documents
on Levick. The court limited the discovery to whether Behunin
and Steiner published the statements on the website and, if so,
whether they published the statements with malice.
The Schwabs served discovery they believed the court gave
them permission to serve. Charles Schwab served Behunin with
33 document requests regarding the website and communications
among Behunin, Steiner, and Levick. He also served a subpoena
2 Code of Civil Procedure section 425.16, subdivision (g),
provides: “All discovery proceedings in the action shall be stayed
upon the filing of a notice of motion made pursuant to this
section. . . . The court, on noticed motion and for good cause
shown, may order that specified discovery be conducted
notwithstanding this subdivision.”
3 The Schwabs alleged that www.chuck-you.com contained
links to other websites, including one operated by Fein, who
writes a blog for the Huffington Post.
6
on Levick for documents regarding the creation and publication
of the website and its content. Michael Schwab served document
requests regarding communications among Behunin, Steiner,
Steiner & Libo, and Levick relating to the website or any of the
entities involved in the Sealutions litigation. He also served a
deposition subpoena on Levick with document requests regarding
communications among Levick, Behunin, Steiner, and Bruce Fein
concerning the website, Sealutions, and two apparently related
entities, Seathos and Emergent Indonesia Opportunity Fund.
Behunin and Steiner objected to the discovery on the
grounds the requests exceeded the scope of the order authorizing
discovery under Code of Civil Procedure section 425.16,
subdivision (g), and sought documents protected from disclosure
by the attorney-client privilege and work product doctrine.
Behunin and Steiner also provided extensive privilege logs.
The parties filed competing discovery motions. Steiner and
Behunin moved for a protective order, arguing they intended all
communications with Levick to be protected by the attorney-
client privilege and work product doctrine, and claiming Steiner
engaged Levick to create and execute legal strategies and tactics
relating to Behunin’s litigation. The Schwabs filed motions to
compel the production of documents from Behunin and Steiner.
The trial court referred the motions to a discovery referee,
who summarized the disputed document requests as follows:
Request for Production No. 1: All documents relating to
communications between you4 and any employee or agent of the
4 These requests are from Michael Schwab’s document
requests to Steiner & Libo, which define “you” as Steiner & Libo,
its partners, agents, employees, representatives, and all persons
acting on its behalf.
7
public relations firm Levick and related to Michael Schwab;
Request for Production No. 2: All documents relating to
communications between you and any employee or agent of the
public relations firm Levick and related to Nicholas Behunin;
Request for Production No. 3: All documents relating to
communications between you and any employee or agent of the
public relations firm Levick and related to the “chuck-you.com”
website;
Request for Production No. 5: All documents relating to
communications between you and any employee or agent of the
public relations firm Levick and related to Sealutions, LLC;
Request for Production No. 6: All documents relating to
communications between you and any employee or agent of the
public relations firm Levick and related to Seathos, Inc.; and
Request for Production No. 7: All documents relating to
communications between you and any employee or agent of the
public relations firm Levick and related to Emergent Indonesia
Opportunity Fund.
In a 34-page document that summarized the parties’
positions and included findings and recommendations, the
discovery referee determined the documents the Schwabs sought
from Levick and Steiner were not protected by the attorney-client
privilege or work product doctrine. The referee stated: “Based on
the evidence provided by [Behunin and Steiner] as of this date, it
is unclear whether Levick actively participated in developing and
employing strategy in connection with the Sealutions litigation or
was hired for the sole purpose of creating the chuck-you[.]com
website and its content. The Referee will, out of an abundance of
caution, hold an evidentiary hearing in camera to determine
whether Steiner [and Behunin] can satisfy their prima facie
8
burden that their communications with Levick were for the
purposes of giving or receiving advice directed at handling the
prosecution of [Behunin’s] legal action. The moving papers do not
meet that burden.”
Steiner and Behunin submitted 21 documents to the
referee for in camera review. After reviewing the documents, the
referee confirmed his final recommendation was consistent with
his initial conclusion. Behunin and Steiner objected in the trial
court to the discovery referee’s recommendations.
The trial court overruled the objections by Behunin and
Steiner to the discovery referee’s report and adopted the referee’s
recommendations. The court ordered Levick to be deposed and to
produce responsive documents, including his communications
with Steiner and Behunin. The court also ordered Behunin and
Steiner to produce the documents responsive to Michael Schwab’s
document requests. Regarding the 21 documents submitted to
the discovery referee for in camera review, the trial court ruled
that Behunin and Steiner had to produce document Nos. 1-11
because they were communications in which Levick participated,
but Behunin and Steiner did not have to produce document Nos.
12-19 because these were communications solely between Steiner
and Behunin.5 Behunin produced some documents, but refused
5 Behunin misinterprets the court’s order in this regard.
Behunin asserts the court ordered him and Steiner to produce
documents that were “exclusively between attorney Steiner and
[Behunin], which were submitted for the referee’s in camera
review.” In fact, the court’s April 20, 2016 order states that
“[b]ased on [Behunin’s and Steiner’s] representations that
Documents 12-19 constituted communications solely between
Leonard Steiner and his clients and were not communicated to
Levick Strategic Communications, and based upon the Court’s
9
to produce others, including documents in the possession of
Levick and Steiner that Behunin still claimed were protected
from disclosure by the attorney-client privilege.
Behunin filed a petition for writ of mandate and requested
an immediate stay of the trial court’s orders. We issued an order
to show cause why we should not compel the trial court to vacate
its orders, and stayed all discovery proceedings pending the
disposition of this proceeding.
DISCUSSION
A. Standard of Review
“‘The appellate court may entertain a petition for
extraordinary relief when compulsion to answer a discovery order
would violate a privilege.’” (Fireman’s Fund Ins. Co. v. Superior
Court (2011) 196 Cal. App. 4th 1263, 1272; see Zurich American
Ins. Co. v. Superior Court (2007) 155 Cal. App. 4th 1485, 1493.) In
general, “[a] trial court’s determination of a motion to compel
discovery is reviewed for abuse of discretion.” (Costco Wholesale
Corp. v. Superior Court (2009) 47 Cal. 4th 725, 733; see
Kirchmeyer v. Phillips (2016) 245 Cal. App. 4th 1394, 1402; Bank
of America, N.A. v. Superior Court (2013) 212 Cal. App. 4th 1076,
1089.) “We review the trial court’s privilege determination under
the substantial evidence standard. ‘“‘When the facts, or
limited review of those documents, the Court finds that
Documents 12-19 are not apparently responsive to the subpoena
or to the Request for Production and that Documents 12-19 need
not be produced at this time, nor at any time necessarily, pending
further proceedings thereon, which the court neither urges nor
suggests.”
10
reasonable inferences from the facts, shown in support of or in
opposition to the claim of privilege are in conflict, the
determination of whether the evidence supports one conclusion or
the other is for the trial court, and a reviewing court may not
disturb such finding if there is any substantial evidence to
support it [citations].’” [Citation.] Accordingly, unless a claimed
privilege appears as a matter of law from the undisputed facts,
an appellate court may not overturn the trial court’s decision to
reject that claim.’” (Roman Catholic Archbishop of Los Angeles v.
Superior Court (2005) 131 Cal. App. 4th 417, 442-443.)
Whether a party has waived a privilege, however, is often a
mixed question of law and fact. “‘Mixed questions of law and fact
concern the application of the rule to the facts and the consequent
determination whether the rule is satisfied.’ [Citation.] As the
historical facts are undisputed, the question is whether, given
those historical facts, [a party] has waived the attorney-client
privilege and attorney work product protection. That inquiry
‘requires a critical consideration, in a factual context, of legal
principles and their underlying values.’ . . . Therefore, the
question is predominately legal, and we independently review the
trial court’s decision.” (McKesson HBOC, Inc. v. Superior Court
(2004) 115 Cal. App. 4th 1229, 1235-1236; see City of Petaluma v.
Superior Court (2016) 248 Cal. App. 4th 1023, 1031.)
B. Applicable Law
Evidence Code section 954 provides: “Subject to Section
912 and except as otherwise provided in this article, the client,
whether or not a party, has a privilege to refuse to disclose, and
to prevent another from disclosing, a confidential communication
11
between client and lawyer . . . .”6 (See Kerner v. Superior Court
(2012) 206 Cal. App. 4th 84, 116 [“[t]he attorney-client privilege
protects confidential communications between a client and his or
her attorney made in the course of an attorney-client
relationship”].) “[T]he attorney-client privilege applies only to
confidential communications.” (Anten v. Superior Court (2015)
233 Cal. App. 4th 1254, 1260, fn. 6; see Catalina Island Yacht
Club v. Superior Court (2015) 242 Cal. App. 4th 1116, 1129, fn. 5
[“the attorney-client privilege attaches only to confidential
communication made in the course of or for the purposes of
facilitating the attorney-client relationship”]; Benge v. Superior
Court (1982) 131 Cal. App. 3d 336, 346 [“[t]he privilege includes
only confidential communications”].)
Section 952 defines a confidential attorney-client
communication: “[A] ‘confidential communication between client
and lawyer’ means information transmitted between a client and
his or her lawyer in the course of that relationship and in
confidence by a means which, so far as the client is aware,
discloses the information to no third persons other than those
who are present to further the interest of the client in the
consultation or those to whom disclosure is reasonably necessary
for the transmission of the information or the accomplishment of
the purpose for which the lawyer is consulted, and includes a
legal opinion formed and the advice given by the lawyer in the
course of that relationship.”
Section 912, subdivision (d), similarly addresses whether
disclosure of an attorney-client communication to a third person
waives the privilege: “A disclosure in confidence of a
6 Undesignated statutory references are to the Evidence
Code.
12
communication that is protected by a privilege provided by
Section 954 (lawyer-client privilege) . . . , when disclosure is
reasonably necessary for the accomplishment of the purpose for
which the lawyer . . . was consulted, is not a waiver of the
privilege.” For the purpose of this case, analysis of whether
disclosure was “reasonably necessary” within the meaning of
sections 954 and 912, subdivision (d), is the same. (See McKesson
HBOC, Inc. v. Superior Court, supra, 115 Cal.App.4th at p. 1236,
fn. 5 [the analysis under section 952 of whether information
disclosed to a third party is made “to further the interest of the
client in the consultation” and the analysis under section 912,
subdivision (d), of whether information disclosed to a third party
is “reasonably necessary for . . . the accomplishment of the
purpose for which the lawyer is consulted” is essentially the
same]; First Pacific Networks, Inc. v. Atlantic Mut. Ins. Co.
(N.D.Cal. 1995) 163 F.R.D. 574, 581 [California courts have
resolved privilege issues involving third parties with the “concept
that is common to both sections 912 and 952 . . . that the
privilege can continue to attach to communications that are
disclosed in confidence to third persons when that disclosure is
reasonably necessary to achieve the ends for which the lawyer is
being consulted”].)
The involvement of a third party changes the burden of
proof in litigating attorney-client privilege issues. “Generally,
‘[t]he burden of establishing that a particular matter is privileged
is on the party asserting the privilege.’ [Citation.] There is an
exception: ‘Whenever a privilege is claimed on the ground that
the matter sought to be disclosed is a communication made in the
course of the lawyer-client . . . relationship, the communication is
presumed to have been made in confidence and the opponent of
13
the claim of privilege has the burden of proof to establish that the
communication was not confidential.’” (Sony Computer
Entertainment America, Inc. v. Great American Ins. Co. (N.D.Cal.
2005) 229 F.R.D. 632, 633-634 (Sony); see § 917, subd. (a); Costco
Wholesale Corp. v. Superior Court, supra, 47 Cal.4th at p. 733
[“[o]nce [a] party establishes facts necessary to support a prima
facie claim of privilege [i.e., communication made in the course of
attorney-client relationship], the communication is presumed to
have been made in confidence”].)
This “exception to the normal allocation of burden is lost,
however, when the communication is disclosed to a third
party. . . . Where a third party is present, no presumption of
confidentiality obtains, and the usual allocation of burden of
proof, resting with the proponent of the privilege, applies in
determining whether confidentiality was preserved under § 952.”
(Sony, supra, 229 F.R.D. at p. 634; see Raytheon Co. v. Superior
Court (1989) 208 Cal. App. 3d 683, 688 [“the presence of third
parties does not destroy confidentiality if the disclosure was
reasonably necessary to accomplish the client’s purpose in
consulting counsel”], italics added.) “It is appropriate that the
proponent of the privilege has the burden of proving that a third
party was present to further the interest of the proponent
because, in this situation, where the privilege turns on the nature
of the relationship and content of communications with the third
party in question, the proponent is in the better posture to come
forward with specific evidence explaining why confidentiality was
not broken.” (Sony, at p. 634, fn. 1.) In other words, the
opponent of the party claiming the privilege under section 952
“cannot demonstrate that each communication between [the
party claiming the privilege and a third party] was not
14
reasonably necessary to accomplish the purpose for which a
lawyer was consulted” because, “[a]s a practical matter, it is
impossible to know whether any of the disclosures of purportedly
privileged information . . . were reasonably necessary to
accomplish the purpose for which a lawyer was consulted without
knowing in at least a general sense the communication’s content.”
(OXY Resources California LLC v. Superior Court (2004) 115
Cal. App. 4th 874, 895.)
C. Behunin Failed To Prove the Communications
Among Him, Steiner, and Levick Were Reasonably
Necessary for Steiner’s Representation of Him in the
Sealutions Litigation
There is no “public relations privilege” in California, and
the courts cannot create one. (See Seahaus La Jolla Owners
Assn. v. Superior Court (2014) 224 Cal. App. 4th 754, 766-767
[“‘[t]he privileges set out in the Evidence Code are legislative
creations; the courts of this state have no power to expand
them’”]; Citizens for Ceres v. Superior Court (2013) 217
Cal. App. 4th 889, 912 [“we are forbidden to create privileges or
establish exceptions to privileges through case-by-case
decisionmaking”].) Therefore, whether communications among a
client, his or her attorney, and a public relations consultant are
protected by the attorney-client privilege depends on whether the
communications were confidential and whether disclosing them
to the consultant was reasonably necessary to accomplish the
purpose for which the client consulted the attorney. (See §§ 912,
subd. (d), 952; Seahaus La Jolla Owners Assn., at p. 766.)
In Citizens for Ceres, supra, 217 Cal. App. 4th 889, the court
explained there are two ways disclosure of a privileged
communication to a third party may not destroy the privileged
15
nature of the communication under section 912, subdivision (d),
and section 952: “The first is where the third party has no
interest of his or her own in the matter, but a litigant must
disclose a confidential communication to the third party because
the third party is an agent or assistant who will help to advance
the litigant’s interests. This is the category the Law Revision
Commission described in commenting on Evidence Code section
912, subdivision (d) . . . . [¶] . . . ‘For example, where a
confidential communication from a client is related by his
attorney to a physician, appraiser, or other expert in order to
obtain that person’s assistance so that the attorney will better be
able to advise his client, the disclosure is not a waiver of the
privilege, even though the disclosure is made with the client’s
knowledge and consent.’” (Citizens for Ceres, at pp. 915-916.)
“The second category is where the third party is not in any
sense an agent of the litigant or attorney but is a person with
interests of his or her own to advance in the matter, interests
that are in some way aligned with those of the litigant. . . . ‘The
words [in section 952] “other than those who are present to
further the interest of the client in the consultation” indicate that
a communication to a lawyer is nonetheless confidential even
though it is made in the presence of another person—such as a
spouse, parent, business associate, or joint client—who is present
to further the interest of the client in the consultation. These
words refer, too, to another person and his attorney who may
meet with the client and his attorney in regard to a matter of
joint concern.’ [Citation.] [¶] It is this last notion, ‘joint concern,’
that is the basis of the common-interest doctrine. . . . [I]n limited
situations, the alignment of the parties’ common interests may
mean disclosures between them are reasonably necessary to
16
accomplish the purposes for which they are consulting counsel.”
(Citizens for Ceres, supra, 217 Cal.App.4th at p. 916.) The
communications by Behunin and Steiner with Levick do not fall
into either of these two categories.
1. Levick Was Not Someone to Whom Disclosure
Was Reasonably Necessary To Accomplish the
Purpose for Which Behunin Retained Steiner
Behunin argues, “As a third party litigation consultant,
Levick must be treated in the same manner as any other third
party intermediary engaged to further litigation objectives, just
like an expert or consultant who aids an attorney in litigation
and who performs litigation-related work.” For disclosure of
communications by Steiner or Behunin to Levick to be protected
by the attorney-client privilege under section 952 and section
912, subdivision (d), however, the disclosure must have been
reasonably necessary for the accomplishment of the purpose for
which Behunin consulted Steiner to represent him in the
Sealutions litigation. (See, e.g., Sony, supra, 229 F.R.D. at p. 634
[attorney-client privilege waived under California law because
client failed to establish that disclosures in the presence of
insurance broker were reasonably necessary for his consultation
with counsel].)
There are no California cases analyzing whether a
communication disclosed to a public relations consultant is a
confidential communication between a client and a lawyer under
section 952 or whether such a disclosure waives the attorney-
client privilege under section 912. California cases analyzing the
exception from a waiver of privilege under section 912,
subdivision (d), provide little guidance in determining whether
17
and when sharing a privileged communication with a public
relations consultant is “reasonably necessary” because those
cases involve very different factual situations. (See, e.g.,
National Steel Products Co. v. Superior Court (1985) 164
Cal. App. 3d 476, 484 [no waiver of the privilege in a lawsuit for
negligent construction because it was reasonably necessary for
the client to give an engineering expert information about the
construction of the building so the expert could provide the
client’s lawyer with a technical analysis]; Blue Cross v. Superior
Court (1976) 61 Cal. App. 3d 798, 801 [no waiver of the physician-
patient privilege by disclosing patient names and medical
conditions to an insurance company because disclosure “was
‘reasonably necessary for . . . the accomplishment of the purpose
for which the physician [was] consulted’”]; see also Raytheon v.
Superior Court, supra, 208 Cal.App.3d at p. 689 [case remanded
for trial court to determine whether it was reasonably necessary
for the client to disclose documents to other companies and their
attorneys who also were under investigation by Environmental
Protection Agency].)
There are, however, federal decisions applying state law in
diversity cases that address whether disclosure of an attorney-
client privileged communication to a public relations consultant
waives the privilege.7 (See, e.g., Grand Canyon Skywalk
7 Federal courts apply state privilege law in diversity actions
where state law provides the rule of decision. (Theme
Promotions, Inc. v. News America Marketing FSI (9th Cir. 2008)
546 F.3d 991, 1007; Fed. Rules Evid., rule 501; see KL Group v.
Case, Kay & Lynch (9th Cir. 1987) 829 F.2d 909, 918 [“[t]he
availability of the attorney-client privilege in a diversity case is
governed by state law”].)
18
Development LLC v. Cieslak (D.Nev. 2015) 2015 WL 4773585, 9
[finding no waiver under Nevada law of the attorney-client
privilege by disclosure to a public relations consultant and, after
reviewing cases, concluding “[c]ourts are divided on whether the
attorney-client privilege extends to communications between a
client’s counsel and a public relations consultant that the client
or its counsel hires to assist in ongoing or anticipated legal
matters or disputes”]; Egiazaryan v. Zalmayev (S.D.N.Y. 2013)
290 F.R.D. 421, 431 [finding under New York law, which is
similar to California law on this issue, an “agency exception” to
the disclosure of privileged communications to third parties
where the disclosure is “necessary for the client to obtain
informed legal advice”].)
In Egiazaryan the plaintiff, a former Russian politician,
sued a writer for defamation, and the writer brought
counterclaims for defamation and violation of New York’s
anti-SLAPP statute.8 (Egiazaryan, supra, 290 F.R.D. at p. 421.)
The defendant sought discovery of communications between the
plaintiff and a public relations firm the plaintiff’s attorneys had
hired. (Id. at p. 425.) The plaintiff asserted the attorney-client
privilege and argued the public relations consultants were his
“agents.” (Id. at pp. 427, 430.) The plaintiff submitted
declarations and documents showing the public relations
consultants “‘[d]evelop[ed] a set of key messages and compelling
narrative in support of the legal cases,’” “‘participate[ed] in the
development of legal strategy,’” “‘contribut[ed] legal
8 New York’s anti-SLAPP law authorizes an action for
damages. (See New York Law § 70-a, subd. (1); Friends of
Rockland Shelter Animals, Inc. v. Mullen (S.D.N.Y. 2004) 313
F. Supp. 2d 339, 344.)
19
recommendations, provid[ed] next step action plans,’” “‘weigh[ed]
strategic considerations in order to promote [the plaintiff’s]
overall legal goals,’” “discussed ‘legal options’ with [the plaintiff’s]
attorneys,” “gave ‘advice in determining the benefits of taking
legal action,’” and “‘advised counsel for [the plaintiff] as to what
might be effectively done on the public relations front . . . so [the
attorneys] could properly advise their client as to the appropriate
course of action in light of his wider litigation interests.’” (Id. at
pp. 421, 426, 430-431.) The plaintiff also submitted a privilege
log, and the court reviewed in camera the documents the plaintiff
withheld from production. (Id. at p. 426.)
Yet, even with all of this evidence, the court found the
plaintiff had not established the involvement of the public
relations consultant was “necessary to facilitate communications
between [the plaintiff] and his counsel, as in the case of a
translator or an accountant clarifying communications between
an attorney and client,” nor had the consultants “‘improved the
comprehension of the communications between attorney and
client.’” (Egiazaryan, supra, 290 F.R.D. at p. 431.) The court
held “the party asserting the agency exception must show: ‘(1)
. . . a reasonable expectation of confidentiality under the
circumstances, and (2) [that] disclosure to the third party was
necessary for the client to obtain informed legal advice.’” (Ibid.)
The court explained “‘the “necessity” element means more than
just useful and convenient, but rather requires that the
involvement of the third party be nearly indispensable or serve
some specialized purpose in facilitating the attorney-client
communications.’” (Ibid.) The court concluded the “mere fact that
[the public relations consultant] was inserted into the legal
decisionmaking process does nothing to explain why [the
20
consultant’s] involvement was necessary to [the plaintiff’s]
obtaining legal advice from his actual attorneys.” (Ibid.; see
Haugh v. Schroder Inv. Mgmt. N. Am. Inc. (S.D.N.Y. Aug. 25,
2003, No. 02 Civ.7955 DLC) 2003 WL 21998674, 3 [“[a] media
campaign is not a litigation strategy,” and while “[s]ome
attorneys may feel it is desirable at times to conduct a media
campaign,” such a desire “does not transform their coordination
of a campaign into legal advice”]; see, e.g., Fine v. ESPN, Inc.
(N.D.N.Y May 28, 2015, No. 5:12-CV-0836) 2015 WL 3447690, 11
[under New York law, the agency exception to waiver of the
attorney-client privilege by disclosure to a third party did not
apply to communications with a public relations consultant
retained to shape media coverage of allegations of sexual abuse at
a university where the documents “did not contain
communications related to obtaining legal advice,” and “[i]f public
relations support is merely helpful, but not necessary to the
provision of legal advice, the agency exception does not apply”];
McNamee v. Clemens (E.D.N.Y. Sept. 18, 2013, No. 09 CV 1647)
2013 WL 6572899 at p. 6 [attorney-client privilege under New
York law did not protect communications with a public relations
consultant because they did not seek legal advice relating to
pending litigation, but instead “facilitated the development of a
public relations campaign and media strategy primarily aimed at
protecting [the client’s] public image and reputation in the face of
allegations that he used performance-enhancing drugs”].)
Behunin provided little evidence explaining how or why
communications among Levick, Steiner, and himself were
reasonably necessary to assist Steiner in his ability to advise
Behunin or litigate his case. Behunin produced no evidence
showing why his or Steiner’s communications with Levick were
21
reasonably necessary to develop a litigation strategy or to induce
the Schwabs to settle. Behunin submitted none of the evidence
the client in Egiazaryan submitted (which in that case still was
insufficient) regarding Levick’s involvement with Steiner in
developing, discussing, or assisting in executing a legal strategy.
To the contrary, according to Behunin, Steiner had little
involvement with Levick: All Steiner did was act as a liaison in
hiring the public relations firm. Behunin and Steiner stated they
engaged Levick to “develop and deploy” strategy, they intended
their communications with Levick to be confidential, and the goal
of the agreement with Levick was “to develop and deploy strategy
and tactics of [Behunin’s] legal complaint” in the Sealutions
lawsuit. But these statements are just conclusions. They do not
include any evidentiary facts showing or explaining why Steiner
needed Levick’s assistance to accomplish the purpose for which
Behunin retained him.
There may be situations in which an attorney’s use of a
public relations consultant to develop a litigation strategy or a
plan for maneuvering a lawsuit into an optimal position for
settlement would make communications between the attorney,
the client, and the consultant reasonably necessary for the
accomplishment of the purpose for which the attorney was
consulted. But this is not that case. Behunin had the burden of
showing his and Steiner’s communications with Levick were
reasonably necessary for the accomplishment of the purpose for
which Behunin retained Steiner, which was to provide Behunin
with legal advice regarding Sealutions and to represent him in
his action against the Schwabs. The discovery referee and the
22
trial judge, both of whom reviewed the documents in camera,9
found Behunin had not met his burden. (See OXY Resources,
supra, 115 Cal.App.4th at p. 896 [in camera review is appropriate
to determine “whether disclosure to a third party was reasonably
necessary to accomplish the lawyer’s purpose in the
consultation”].) There is insufficient evidence in this record for
us to reach a contrary conclusion.
In arguing his and Steiner’s communications with Levick
were reasonably necessary to accomplish the purpose of Steiner’s
representation because the negative publicity would help get the
Schwabs to the settlement table, Behunin extends the privilege
too far. (See McKesson HBOC, Inc. v. Superior Court, supra, 115
Cal.App.4th at p. 1236 [attorney-client and other “evidentiary
privileges should be narrowly construed because they prevent the
admission of relevant and otherwise admissible evidence”]; see
also People v. Sinohui (2002) 28 Cal. 4th 205, 212 [“[b]ecause
privileges ‘prevent the admission of relevant and otherwise
admissible evidence,’ they ‘should be narrowly construed’”];
Union Bank of California, N.A. v. Superior Court (2005) 130
Cal. App. 4th 378, 392 [evidentiary privileges “should be narrowly
construed because they prevent otherwise admissible and
relevant evidence from coming to light”].) To be sure, maximizing
9 Behunin does not argue the in camera reviews violated
section 915, which prohibits a court or discovery referee from
requiring disclosure of information claimed to be protected by the
attorney-client privilege. (Cf. Costco Wholesale Corp. v. Superior
Court, supra, 47 Cal.4th at pp. 736-740; DP Pham, LLC v.
Cheadle (2016) 246 Cal. App. 4th 653, 666-667.) The discovery
referee invited Behunin to submit the documents for in camera
review, and Behunin voluntarily accepted the invitation.
23
a client’s negotiating position and increasing the prospects for a
favorable settlement are important parts of representing a client
in litigation. All kinds of strategies could conceivably put
pressure on the Schwabs to settle with Behunin, such as hiring
away employees of the Schwabs or their company, lobbying
governmental officials to enact regulations adverse to the
Schwabs’ investment business, and creating a competing
brokerage business to take away the Schwabs’ clients. Such
strategies might help get the Schwabs to settle the Sealutions
litigation on favorable terms. But that does not mean Behunin’s
or Steiner’s communications with headhunters, lobbyists, and
lenders who might finance a competing company would be
privileged. Without some explanation of how the
communications assisted the attorney in developing a plan for
resolving the litigation, Behunin would not be able to show such
communications were reasonably necessary to accomplish
Steiner’s purpose in representing Behunin.
The case on which Behunin primarily relies, In re Grand
Jury Subpoenas Dated March 24, 2003 (S.D.N.Y. 2003) 265
F. Supp. 2d 321, is distinguishable. The court in that case applied
the federal common law on attorney-client privilege, which is
broader than New York law and California law and does not
require a finding the communication was reasonably necessary
for the attorney to provide legal advice. (See In re Grand Jury
Subpoenas, supra, at p. 324 [scope of attorney-client privilege is
governed by federal common law in cases involving federal
questions]; see also Fine v. ESPN, Inc., supra, 2015 WL 3447690,
at 11, fn. 7 [“courts have declined to extend In re [G]rand Jury
Subpoenas to cases applying the New York attorney-client
24
privilege rule because New York’s agency exception is narrower
than the federal rule applied in that case”].)
Moreover, the court’s decision in In re Grand Jury
Subpoenas was based on very specific facts not present here. The
case arose in the context of a highly publicized grand jury
investigation of a celebrity facing criminal indictment. (In re
Grand Jury Subpoenas, supra, 265 F.Supp.2d at pp. 323-324.)
The celebrity’s attorneys hired a public relations firm whose
“‘primary responsibility was defensive—to communicate with the
media in a way that would help restore balance and accuracy to
the press coverage. [The] objective . . . was to reduce the risk
that prosecutors and regulators would feel pressure from the
constant anti-[client] drumbeat in the media to bring charges.”
(Id. at p. 323.) The court explained that protecting such
communications from disclosure would support one of the
purposes of the attorney-client privilege, the administration of
justice: “[The client], like any investigatory target or criminal
defendant, is confronted with the broad power of the government.
Without suggesting any impropriety, the Court is well aware that
the media, prosecutors, and law enforcement personnel in cases
like this often engage in activities that color public opinion, . . . in
the most extreme cases, to the detriment of his or her ability to
obtain a fair trial. . . . Thus, in some circumstances, the advocacy
of a client’s case in the public forum will be important to the
client’s ability to achieve a fair and just result in pending or
threatened litigation.” (Id. at p. 330.)
The court in In re Grand Jury Subpoenas held that “(1)
confidential communications (2) between lawyers and public
relations consultants (3) hired by the lawyers to assist them in
dealing with the media in cases such as this (4) that are made for
25
the purpose of giving or receiving advice (5) directed at handling
the client’s legal problems are protected by the attorney-client
privilege.” (In re Grand Jury Subpoenas, supra, 265 F.Supp.2d.
at pp. 330-331, italics added.)10 Courts in subsequent cases have
recognized the limited nature of the court’s holding. (See
Bloomingburg Jewish Education Center v. Village of
Bloomingburg, New York (S.D.N.Y. 2016) 171 F. Supp.3d 136,
146 [“[c]entral to the court’s ruling on the issue of attorney-client
privilege [in In re Grand Jury Subpoenas] were the special
purposes to which the consultants were being used in light of the
particular circumstances of that case”]; Ravenell v. Avis Budget
Grp., Inc. (E.D.N.Y. Apr. 5, 2012, No. 08-CV-2113) 2012 WL
1150450, 3 [“[t]he reach of [In re Grand Jury Subpoenas is]
limited by its context: the Court couched its finding in the narrow
scenario of public relations consultants assisting lawyers during
a high profile grand jury investigation”]; In re Chevron Corp.
(S.D.N.Y. 2010) 749 F. Supp. 2d 170, 184, fn. 64 [interpreting In re
Grand Jury Subpoenas as having a “very narrow holding”
10 The court distinguished an earlier case, Calvin Klein
Trademark Trust v. Wachner (S.D.N.Y. 2000) 198 F.R.D. 53,
where the court found the communications between the public
relations firm and the attorneys were not privileged, in part
because the purpose of the communications was not to obtain
legal advice but to obtain the same ordinary public relations
advice the firm had provided to the client in the past. (Id. at p.
55.) The court in Calvin Klein Trademark Trust explained,
“‘Nothing in the policy of the privilege suggests that attorneys,
simply by placing accountants, scientists, or investigators [or,
here, a public relations firm] on their payrolls . . . should be able
to invest all communications by clients to such persons with a
privilege the law has not seen fit to extend when the latter are
operating under their own steam.’” (Ibid.)
26
applicable only in “cases such as . . . high profile grand jury
investigation[s]”], affd. (2d Cir. 2010) 409 Fed.Appx. 393.)
Behunin also relies on a line of federal cases that have
applied the attorney-client privilege to communications with
public relations consultants on the ground that the consultant
was the functional equivalent of an employee of the client. (See,
e.g., Grand Canyon Skywalk Development LLC v. Cieslak, supra,
2015 WL 4773585 at p. 17 [communications between a public
relations firm and tribal council were privileged because the
public relations firm was the “functional equivalent” of a tribal
employee]; In re Copper Market Antitrust Litigation (S.D.N.Y.
2001) 200 F.R.D. 213 [public relations firm that regularly
conferred with the client’s litigation counsel in preparing press
releases and other materials incorporating the lawyer’s advice
was the “functional equivalent” of an in-house public relations
department].)
These cases extend the rule that the attorney-client
privilege applies to communications between counsel and
corporate employees seeking legal advice to communications
between counsel and those deemed the functional equivalent of
corporate employees. (See U.S. v. Chen (9th Cir. 1996) 99 F.3d
1495, 1500, citing Upjohn Co. v. U.S. (1981) 449 U.S. 383, 390-
394). The functional-equivalent cases, however, require a
detailed factual showing that the consultant was responsible for a
key corporate job, had a close working relationship with the
company’s principals on matters critical to the company’s position
in litigation, and possessed information possessed by no one else
at the company. (See, e.g., F.T.C. v. GlaxoSmithKline (D.C. Cir.
2002) 294 F.3d 141, 148 [documents were protected by attorney-
client privilege where the corporation submitted evidence
27
showing corporate counsel worked with public relations
consultants in same manner as it did with full-time employees
and the consultants were integral members of the team assigned
to deal with litigation]; Schaeffer v. Gregory Village Partners, L.P.
(N.D. Cal. 2015) 78 F. Supp. 3d 1198, 1204 [consultant “acted as
the public face of the company and provided information to
[company’s] legal staff that was useful and necessary to evaluate
legal strategy . . . [and] acted as [the company’s] functional
employee for the purposes of the attorney-client privilege”]; A.H.
ex rel. Hadjih v. Evenflo Company, Inc. (D.Colo. 2012, No. 10-CV-
02435-RBJ-KMT) 2012 WL 1957302, 3 [under Colorado law,
communications “predominately of a legal character” between
public relations consultants and company’s attorneys were
privileged because the consultants were “functional equivalents”
of employees].) These cases have no application here. Behunin
does not argue that Levick is the “functional equivalent” of his
employee, and there is nothing in the record to suggest there was
any such relationship between Levick and Behunin or his
company.
2. The Common Interest Doctrine Does Not Apply
The common-interest doctrine applies where the
individuals involved in a communication have common interests
such that disclosures between them are reasonably necessary to
accomplish the purposes for which they are consulting counsel.
(Citizens for Ceres v. Superior Court, supra, 217 Cal.App.4th at p.
916.) “[I]n the context of communications among parties with
common interests, it is essential that participants in an exchange
have a reasonable expectation that information disclosed will
remain confidential. . . . In addition, disclosure of the
28
information must be reasonably necessary for the
accomplishment of the purpose for which the lawyer was
consulted.” (OXY Resources, supra, 115 Cal.App.4th at p. 891;
see § 912, subd. (d); Raytheon Co. v. Superior Court, supra, 208
Cal.App.3d at p. 689 [there is “no ‘joint defense privilege’ as such
in California, but . . . the issue of waiver must be determined
under [section 912] with respect to the attorney-client privilege,
and depends on the necessity for the disclosure”].) “‘For the
common interest doctrine to attach, most courts seem to insist
that the two parties have in common an interest in securing legal
advice related to the same matter—and that the communications
be made to advance their shared interest in securing legal advice
on that common matter.’” (OXY Resources, at p. 891; see STI
Outdoor v. Superior Court (2001) 91 Cal. App. 4th 334, 341 [no
waiver of the attorney-client privilege where the “evidence
supports the contention that the disclosure of such documents
was reasonably necessary to further the interests of both parties
in finalizing negotiations for the license agreement”].)
Behunin and Levick do not have a common interest “in
securing legal advice related to the same shared matter.” (OXY
Resources, supra, 115 Cal.App.4th at p. 891.) Behunin argues
“Levick and [Behunin] shared [an] interest in obtaining legal
advice with respect to whether it was permissible to post content
on the Internet,” and “[s]uch advice clearly encompassed
questions regarding [Behunin’s and Levick’s] potential exposure
to legal liability for such statements.” There is no evidence,
however, that Levick sought legal advice from Steiner or that
there was an attorney-client relationship between Steiner and
Levick. To the contrary, Behunin stated in his declaration that
Steiner hired Levick on behalf of Behunin without knowing
29
anything about the content of the website Levick was to create.
Although Levick, as a paid consultant, may have wanted its
public relations campaign to succeed, that is not the kind of
common interest contemplated by sections 912 and 952. (See
McKesson HBOC, Inc. v. Superior Court, supra, 115 Cal.App.4th
at p. 1237 [“[sections 912 and 952] permit sharing of privileged
information when it furthers the attorney-client relationship; not
simply when two or more parties might have overlapping
interests”]; Roush v. Seagate Technology, LLC (2007) 150
Cal. App. 4th 210, 225 [“[the plaintiff] merely assumes that, given
their overlapping interests, she and [the attorney’s client in a
different case] could freely share their confidential information
without affecting its privileged character,” but “[u]nder sections
912, subdivision (d) and 952, [the plaintiff] was bound to show, at
minimum, that sharing her confidential information with [the
other client] was reasonably necessary to advance her case”].)
The common interest doctrine is inapplicable.11
11 Although Behunin refers to the attorney work product
doctrine in his petition and in his reply, he provides no legal
argument or authorities to support the application of that
doctrine to documents the court ordered produced. There is also
no evidence in the record from which we might independently
ascertain whether any of the communications to or from Behunin,
Steiner, or Levick or any of the documents created by Levick
would qualify as “[a] writing that reflects an attorney’s
impressions, conclusions, opinions, or legal research or theories”
and thus work product. (Code Civ. Proc., § 2018.030; see Citizens
for Ceres, supra, 217 Cal.App.4th at p. 911 [work produced by an
attorney’s agents and consultants, as well as the attorney’s work
product, may be protected by the attorney work product doctrine];
Armenta v. Superior Court (2002) 101 Cal. App. 4th 525, 534 [to
the extent an expert’s reports “‘embrace counsel’s impressions
30
DISPOSITION
The petition for writ of mandate is denied. The request by
Charles Schwab for sanctions is denied. This court’s order
staying the discovery proceedings in the trial court is vacated.
The Schwabs are to recover their costs in this proceeding.
SEGAL, J.
We concur:
ZELON, Acting P. J. SMALL, J.*
and conclusions, the work-product doctrine gives absolute
protection to that information’”].) Therefore, we do not address
Behunin’s passing references to the attorney work product
doctrine. (See City of Palo Alto v. Public Employment Relations
Board (2016) 5 Cal.App.5th 1271, 1318 [“[p]oints that are raised
that are not supported by reasoned argument and citations to
authority may be deemed forfeited”]; Needelman v. DeWolf Realty
Co., Inc. (2015) 239 Cal. App. 4th 750, 762 [“[i]ssues not supported
by argument or citation to authority are forfeited”]; Cal. Rules of
Court, rule 8.204(a)(1)(C).)
*Judge of the Los Angeles Superior Court, assigned by the Chief
Justice pursuant to article VI, section 6 of the California
Constitution.
31