Friday Invs., LLC v. Bally Total Fitness Of The Mid-Atl.

IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA15-680
Filed: 7 June 2016
Mecklenburg County, No. 14-CVS-8495
FRIDAY INVESTMENTS, LLC, Plaintiff,
v.
BALLY TOTAL FITNESS OF THE MID-ATLANTIC, INC. f/k/a Bally Total Fitness
of the Southeast, Inc. f/k/a/ Holiday Health Clubs of the Southeast, Inc. as successor-
in-interest to Bally Total Fitness Corporation; and BALLY TOTAL FITNESS
HOLDINGS CORPORATION, Defendants.
Appeal by Defendants from Order entered 9 April 2015 by Judge Jesse B.
Caldwell III in Mecklenburg County Superior Court. Heard in the Court of Appeals
18 November 2015.
Knox, Brotherton, Knox & Godfrey, by Lisa Godfrey, for Defendants-Appellants.
Horack, Talley, Pharr & Lowndes, P.A., by Keith B. Nichols, for Plaintiff-
Appellee.
INMAN, Judge.
This appeal requires us to consider the common interest doctrine, which
extends the attorney-client privilege to communications between and among multiple
parties sharing a common legal interest. We hold that an indemnification provision
in an asset purchase agreement, standing alone, is insufficient to create a common
legal interest between a civil litigant indemnitee and a third-party indemnitor.
BALLY TOTAL FITNESS OF THE MID-ATLANTIC, INC. V. FRIDAY INVESTMENTS, LLC
Opinion of the Court
Bally Total Fitness of the Mid-Atlantic, Inc. (“Mid-Atlantic”) and Bally Total
Fitness Holding Corporation (“Holding”) (collectively “Defendants”) appeal the trial
court’s Order denying their Motion for a Protective Order on Supplementation of
Written Discovery and granting Plaintiff Friday Investments, LLC’s (“Plaintiff”)
Motion to Compel production of email and written communication between
Defendants and third party Blast Fitness Group (“Blast”). Defendants contend that
the trial court failed to recognize that they had entered into a tripartite attorney-
client relationship with Blast, so that communications between Defendants and Blast
are protected by the attorney-client privilege. After careful review, we affirm.
Facts and Background
In February 2000, the predecessor in interest of Mid-Atlantic entered into a
lease agreement with the predecessor in interest of Plaintiff for a 25,000 square foot
commercial suite in the Tower Place Festival Shopping Center in Charlotte, North
Carolina. The lease was guaranteed by Holding, the parent company of both Mid-
Atlantic and the original tenant. In 2012, Mid-Atlantic sold certain of its health
clubs, including the Tower Place Club, to Blast. The Asset Purchase Agreement
between Mid-Atlantic and Blast (the “Blast Agreement”) provided that the sale
transferred any “obligations . . . arising . . . under the Real Property Leases” of the
clubs sold. The Blast Agreement also included an indemnification clause wherein
Blast agreed to “defend, indemnify, and hold [Defendants] . . . harmless of, from[,]
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and against any [l]osses incurred . . . on account of or relating to . . . any Assumed
Liabilities, including those arising from or under the Real Property Leases after
closing.”
Plaintiff brought suit against Defendants on 9 May 2014 in Mecklenburg
County Superior Court for payment of back rent and other charges under the lease.
Blast subsequently agreed to defend Defendants as provided for in the Blast
Agreement.
Defendants and Plaintiff completed an initial exchange of documents and
answers to interrogatories on 24 October 2014. Defendants’ Senior Vice President
and General Counsel, Earl Acquaviva, was deposed by Plaintiff on 11 February 2015.
On 19 February 2015, counsel for Plaintiff sent an email to Defendants’ counsel
requesting copies of “post-suit correspondence and documents exchanged between
[Defendants] and Blast.” Defendants refused, and on 3 March 2015, Plaintiff filed a
Motion to Compel production of the requested documents. Defendants responded by
filing a Motion for a Protective Order on 24 March 2015, claiming that
communications between themselves and Blast were subject to attorney-client
privilege. On 25 March 2015, the trial court orally ordered Defendants to produce
the documents and a privilege log for in camera inspection.
On 27 March 2015, Defendants submitted to the trial court the requested
documents and a privilege log. After completing an in camera review of the
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documents, the trial court notified counsel via email on 2 April 2015 that it had denied
Defendants’ Motion for a Protective Order and granted Plaintiff’s Motion to Compel.
The trial court entered a written order on 13 April 2015 consistent with the court’s
email notice but granted a motion by Defendants to stay the decision for review by
this Court.
Defendants timely appealed. The Record on Appeal was settled via stipulation,
pursuant to Rule 11 of the North Carolina Rules of Appellate Procedure, on 29 May
2015. The Record was amended on Defendants’ Motion on 24 July 2015 to include
the trial court’s 2 April 2015 email message.1 On 1 September 2015, Defendants filed
a “Motion to Submit Documents Under Seal,” seeking to transmit the documents
reviewed in camera to this Court for review.
I. Plaintiff’s Motion to Dismiss
Plaintiff argues that a “substantial right” is not at stake because Defendants
waived their right to appeal the discovery order by failing to specifically assert their
attorney-client privilege during the initial round of discovery, and that Defendants’
subsequent Motion for a Protective Order was insufficient to constitute an objection.
We disagree.
1 Defendants initially filed Notice of Appeal from the 2 April 2015 ruling communicated to
counsel via email, but they also filed Notice of Appeal from the order entered 13 April 2015. Both
notices are contained in the Record on Appeal. The email is not an order because it was not filed with
the Clerk of Court. N.C. Gen. Stat. § 1A–1, Rule 58 (2015) (“[A] judgment is entered when it is reduced
to writing, signed by the judge, and filed with the clerk of court.”) Accordingly, this opinion reviews
only the 13 April 2015 Order.
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Opinion of the Court
“An interlocutory order is one made during the pendency of an action, which
does not dispose of the case, but leaves it for further action by the trial court in order
to settle and determine the entire controversy.” Veazey v. City of Durham, 231 N.C.
357, 362, 57 S.E.2d 377, 381 (1950). While there is generally “no right of immediate
appeal from interlocutory orders and judgments,” Goldston v. Am. Motors Corp., 326
N.C. 723, 725, 392 S.E.2d 735, 736 (1990), immediate appeals are available under
N.C. Gen. Stat. §§ 1-277(a) and 7A-27(d)(1) (2015) if the order “deprives the appellant
of a substantial right which would be lost absent immediate review.” N.C. Dep’t of
Transp. v. Page, 119 N.C. App. 730, 734, 460 S.E.2d 332, 334 (1995).
Both this Court and the North Carolina Supreme Court have recognized that
a trial court’s “determination of the applicability of [attorney-client] privilege . . .
affects a substantial right and is therefore immediately appealable.” In re Miller, 357
N.C. 316, 343, 584 S.E.2d 772, 791 (2003); see also Evans v. U.S. Auto. Ass’n, 142 N.C.
App. 18, 24, 541 S.E.2d 782, 786 (2001) (holding that the appeal of a trial court order
denying the assertion of attorney client privilege after an in camera review affects “a
substantial right which would be lost if not reviewed before the entry of final
judgment”).
Nevertheless, the availability of such appeals is contingent upon the proper
assertion of the claimed privilege. In K-2 Asia Ventures v. Trota, this Court held that
to assert a statutory privilege for interlocutory review, the appellant must have
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complied with Rule 34(b) of the North Carolina Rules of Civil Procedure by lodging
specific objections to individual discovery requests. 215 N.C. App. 443, 446–47, 717
S.E.2d 1, 4–5 (2011). Blanket objections that broadly assert a privilege without
attaching it to a particular request, such as the one made by one set of defendants in
K-2 Asia Ventures, are not only procedurally deficient but also fail to satisfy the
requirement that the assertion of privilege be “not otherwise frivolous or
insubstantial.” Id. at 447, 717 S.E.2d at 4 (internal quotation marks and citations
omitted).
Plaintiff attempts to draw a parallel to K-2 Asia Ventures, noting that
Defendants asserted no particularized claim of attorney-client privilege in their
responses to the initial round of discovery. We are unpersuaded. None of the initial
discovery requests expressly sought correspondence between Defendants and Blast.
The initial discovery request that most plainly encompasses these documents—if the
documents are not privileged—is the fourth “Request for Production of Documents,”
which requests “[a]ll non-privileged correspondence or written communication of any
kind between [Defendants] and any other person or entity concerning the [Tower
Place Club], Lease Agreement, Guaranty, or any other issues described or referenced
in the Pleadings in this action.”2 (Emphasis added.) Given the limiting language in
2 Plaintiff argues that correspondence between Defendants and Blast also was within the scope
of several other specific discovery requests that were not limited to non-privileged information.
Request 4, which specifically seeks communications between Defendants and “any other person or
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the request, it is unreasonable—for the purpose of determining waiver—to require
Defendants to have first acknowledged the existence of correspondence they
considered privileged and to have objected to production in response to a request for
“non-privileged” information. 3
The record reflects that when faced with a specific request for their
communications with Blast, Defendants promptly asserted the attorney-client
privilege. During the 11 February 2015 deposition, counsel for Plaintiff asked the
deponent, Mid-Atlantic’s General Counsel Earl Acquaviva, to describe “all of the
conversations that you have had personally with Blast or any representatives of Blast
about this lawsuit.” Defendants’ counsel immediately objected on the basis of
attorney-client privilege and advised the deponent not to answer. Plaintiff’s further
attempts to probe the issue were all met with similar objections by Defendants’
counsel, and the deponent refused to answer such questions.
entity” most plainly encompasses correspondence between Defendants and non-parties to the
litigation, such as Blast. Because we affirm the trial court’s ruling that the documents at issue are
responsive to Request 4, analysis of the other discovery requests is unnecessary.
3 Our holding should not be construed to encourage litigants to assert particularized objections
only when a request clearly seeks privileged information or documents. The best practice for counsel
responding to discovery is to give each request the broadest possible interpretation and to assert
objections to producing information or documents the litigant believes to be beyond the scope of
discovery allowed by the Rules of Civil Procedure. Even when privilege is claimed in good faith, the
adage that it is easier to beg forgiveness than to seek permission undermines public confidence in the
legal profession and our justice system. Defendants would have saved themselves, Plaintiff, the trial
court, and this Court significant resources had they more broadly construed Plaintiff’s requests and
asserted a particularized objection in the first place.
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Opinion of the Court
Based on the foregoing details in the record, we hold that Defendants properly
asserted the attorney-client privilege in a manner that is neither frivolous nor
insubstantial and that this interlocutory appeal affects a “substantial right” of
Defendants. We therefore deny Plaintiff’s motion to dismiss.
II. Defendants’ Motion to Submit Documents Under Seal
In support of their argument that the trial court failed to recognize a tripartite
attorney-client relationship between themselves, Blast, and their counsel,
Defendants submitted a “Motion to Submit Documents Under Seal” to this Court to
examine the documents reviewed in camera by the trial court. We decline to grant
this motion because it is improper, untimely, and unfairly prejudicial.
This Court has repeatedly held that “[i]t is the appellant’s duty and
responsibility to see that the record is in proper form and complete.” State v.
Williamson, 220 N.C. App. 512, 516, 727 S.E.2d 358, 361 (2012) (quoting State v.
Alston, 307 N.C. 321, 341, 298 S.E.2d 631, 644 (1983)). Defendants failed to “request[]
that the trial court review the documents in camera and then seal the documents for
possible appellate review.” Miller v. Forsyth Mem’l Hospital 174 N.C. App. 619, 621,
625 S.E.2d 115, 116 (2005). Defendants could have remedied this failure in the trial
court prior to settling the Record on Appeal.
Even after the Record on Appeal has been settled in the trial court, but prior
to the filing of the Record on Appeal, a party may move this Court to “order additional
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Opinion of the Court
portions of a trial court record or transcript sent up and added to the record on
appeal.” N.C. R. App. P. 9(b)(5)(b) (2015). Once the record has been filed, a party
may still move to amend the record at any time prior to the filing of the opposing
party’s responsive brief. N.C. R. App. P. 9(b)(5)(a) (2015). Here, Defendants failed to
ask the trial court to seal the records for appellate review, did not move this Court to
order the records be sent from the trial court, and filed its unorthodox motion several
days after the submission of Plaintiff’s Brief.
To allow these documents to enter the record after briefing would be unfairly
prejudicial to Plaintiff because such a significant amendment of the record would
likely require both parties to re-brief the case to address legal issues not previously
raised. For example, this Court reviews a trial court’s in camera review of documents
placed under seal de novo, as opposed to for abuse of discretion. E.g., State v.
Minyard, 231 N.C. App. 605, 615, 753 S.E.2d 176, 184 (2014); State v. McCoy, 228
N.C. App. 488, 492, 745 S.E.2d 367, 370 (2013). Amending the appellate record to
include these documents would add issues on appeal, including whether the trial
court erred in its in camera review and whether the documents, based on this Court’s
in camera review, were subject to attorney-client privilege under the five factor
Murvin test. Raymond v. N.C. Police Benevolent Ass’n, 365 N.C. 94, 100–01, 721
S.E.2d 923, 928 (2011); State v. Murvin, 304 N.C. 523, 531, 284 S.E.2d 289, 294
(1981). Accordingly, we deny Defendants’ Motion to Submit Documents Under Seal.
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Opinion of the Court
Because the question presented by Defendants may be addressed by reference
to the nature of the relationship between the parties and the existing Record on
Appeal, the Court can reach the merits of this appeal without reviewing the
documents submitted to the trial court for in camera review.
III. Tripartite Attorney-Client Privilege (Common Interest Doctrine)
Defendants claim that the trial court abused its discretion by “disregard[ing]
a tripartite attorney-client relationship” between Defendants, their attorneys, and
Blast and ordering the production of communications between them. We hold that
Defendants have failed to show that the trial court’s ruling was either “manifestly
unsupported by reason” or “arbitrary.” See K-2 Asia Ventures, 215 N.C. App. at 453,
717 S.E.2d at 8 (citation and quotation marks omitted).
A. Standard of Review
This Court reviews trial court orders relating to discovery issues for abuse of
discretion. Id. To prevail, an appellant must show that the trial court’s ruling was
“manifestly unsupported by reason” and “so arbitrary that it could not have been the
result of a reasoned decision.” State v. T.D.R., 347 N.C. 489, 503, 495 S.E.2d 700, 708
(1998).
B. Analysis
Although attorney-client arrangements between two or more clients have been
recognized by North Carolina courts for more than half a century, Dobias v. White,
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240 N.C. 680, 684–85, 83 S.E.2d 785, 788 (1954), there is a dearth of controlling
appellate precedent explaining the precise nature of these arrangements and the
extension of privilege invoked in disputes with third parties.4 Accordingly, our
discussion of the issue presented in this case is best addressed by reference to not
only the limited controlling authority from our state appellate courts, but also non-
binding, persuasive decisions by other courts.
Arrangements between two or more parties to obtain legal counsel for a shared
legal purpose are known as “tripartite” attorney-client relationships. Raymond, 365
N.C. at 98–99, 721 S.E.2d at 926–27. A tripartite relationship most commonly exists
“when an insurance company employs counsel to defend its insured against a claim.”
Id. at 98, 721 S.E.2d at 926.5 A tripartite relationship may also exist between an
individual and a “trade association or lobbying group that represents a special
interest if there is specific, ongoing litigation.” Raymond, 365 N.C. at 99, 721 S.E.2d
at 927 (citations omitted).
4 Our Supreme Court in Dobias did not address a claim of privilege by members of a tripartite
relationship adverse to a third party, but rather a claim of privilege by one party seeking to bar an
adverse party from discovering documents related to a business transaction in which the parties had
employed joint counsel. The Supreme Court held that “as a general rule, where two or more persons
employ the same attorney to act for them in some business transaction, their communications to him
are not ordinarily privileged inter sese.” 240 N.C. at 685, 83 S.E.2d at 788.
5 The most often cited controlling authority recognizing a tripartite relationship between
insurer, insured, and counsel retained by the insurance company to represent the insured is
Nationwide Mut. Fire Ins. Co. v. Bourlon, 172 N.C. App. 595, 602–03, 617 S.E.2d 40, 45–46 (2005).
However, like Dobias, Nationwide Mut. Fire Ins. Co. sheds little light on the issue presented here,
because that appeal arose from an insurance coverage dispute between the insured and the insurer.
Id.
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The linchpin in any analysis of a tripartite attorney-client relationship is the
finding of a common legal interest between the attorney, client, and third party. See
Raymond, 365 N.C. at 100, 721 S.E.2d at 927 (tripartite attorney-client relationship
existed between attorney, client, and benevolence organization due to the common
interest of “protecting and promoting the livelihood” of the client). “[T]he parties
must first share a common interest about a legal matter.” United States v. Aramony,
88 F.3d 1369, 1392 (4th Cir. 1996).
North Carolina courts have yet to formulate a bright line rule or articulate
criteria for determining whether a common legal interest exists to extend the
attorney-client privilege between multiple parties. Instead, our courts have engaged
in specific analysis of the facts in each case involving this issue. See, e.g., Raymond,
365 N.C. at 100, 721 S.E.2d at 927 (common legal interest based on mission of
benevolent organization); Nationwide Mut. Fire Ins., 172 N.C. App. at 602–03, 617
S.E.2d at 45–46 (common legal interest based on contract between insured and
insurer).
All fifty states and federal courts have recognized the extension of the attorney-
client privilege to certain tripartite relationships under various monikers including,
inter alia, the “joint defense privilege,” the “common interest privilege,” the “common
interest doctrine,” and the “common defense rule.” See, e.g., Aramony, 88 F.3d at
1392; United States v. Schwimmer, 892 F.2d 237, 243–46 (2d. Cir. 1989); United
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States v. McPartlin, 595 F.2d 1321, 1336–37 (7th Cir. 1979); Ferko v. NASCAR, 219
F.R.D. 396, 401–03 (E.D Tex. 2003); Craig S. Lerner, Conspirators’ Privilege and
Innocents’ Refuge: A New Approach to Joint Defense Agreements, 77 Notre Dame L.
Rev. 1449, 1491 (2002). To extend the attorney-client privilege between or among
them, parties must (1) share a common interest; (2) agree to exchange information
for the purpose of facilitating legal representation of the parties; and (3) the
information must otherwise be confidential. Schwimmer, 892 F.2d at 243–244.
Although prudent counsel would always put a representation agreement in writing,
there is no requirement that the agreement be in writing. See McPartlin, 595 F.2d
at 1336. Despite being labeled a “privilege” by some courts, the common interest
doctrine does not recognize an independent privilege, but is “an exception to the
general rule that the attorney-client privilege is waived upon disclosure of privileged
information [to] a third party.” Ferko, 219 F.R.D. at 401. Extension of the attorney-
client privilege to these relationships “serves to protect the confidentiality of
communications passing from one party to the attorney for another party where a
joint defense effort or strategy has been decided upon and undertaken by the parties
and their respective counsel.” Schwimmer, 892 F.2d at 244. The extension of
privilege applies in disputes between third parties and one or more members of the
tripartite arrangement, but not in disputes inter sese. Nationwide Mut. Fire Ins. Co.,
172 N.C. App. at 602–03, 617 S.E.2d at 45–46 (2005) (insured who was represented
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by counsel retained by insurance company in tort litigation by a third party against
the insured was entitled, in separate litigation against the insurer, to discover
communications between the insurer and counsel related to the defense strategy in
underlying litigation); Dobias, 240 N.C. 680 at 683, 83 S.E.2d at 788 (seller and
purchaser of real estate were each entitled to discover the other’s communications
about the deal with their common real estate attorney).
While not binding, decisions by several federal courts and the North Carolina
Business Court provide some clarity as to what constitutes a common legal interest,
distinguishing it in particular from a common business interest. “For the privilege to
apply, the proponent must establish that the parties had some common interest about
a legal matter.” In re Grand Jury Subpoena Under Seal, 415 F.3d 333, 341 (4th Cir.
2005) (emphasis added) (citations and quotation marks omitted). In that vein, the
North Carolina Business Court has held that the common interest doctrine applies to
“communications between separate groups of counsel representing separate clients
having similar interests and actually cooperating in the pursuit of those interests.”
Morris v. Scenera Research, LLC, 2011 NCBC 33, 2011 WL 3808544, at *7 (N.C. Bus.
Ct. Aug. 26, 2011). The Business Court distinguishes such legal interests from
“business interest[s] that may be impacted by litigation involving one of the parties.”
SCR-Tech LLC v. Evonik Energy Serv. LLC, 2013 NCBC 42, 2013 WL 4134602, at *6
(N.C. Bus. Ct. Aug. 13, 2013) (“A party seeking to rely on the common interest
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doctrine must demonstrate that the specific communications at issue were designed
to facilitate a common legal interest; a business or commercial interest will not
suffice.”) (internal citations and quotation marks omitted); see also Bank Brussels
Lambert v. Credit Lyonnais (Suisse) S.A., 160 F.R.D. 437, 447 (S.D.N.Y. 1995) (“[T]he
common interest doctrine does not encompass a joint business strategy which
happens to include as one of its elements a concern about litigation.”).
In SCR-Tech, the parties seeking protection under the common interest
doctrine were linked by ownership interests as well as a cooperation agreement. 2013
WL 4134602, at *1. SCR-Tech, the proponent of the privilege, had been previously
owned by Ebinger. Id. After selling SCR-Tech, Ebinger had come into legal conflict
with defendant Evonik over the same technology, and had executed an agreement to
support SCR-Tech in its claims against Evonik. Id. The Behusiness Court
distinguished between “communications between Ebinger and SCR-Tech to
coordinate positions to be taken in the separate lawsuits between them and
Defendants, and . . . communications by which Ebinger provided SCR-Tech assistance
in the present litigation pursuant to the Cooperation Agreement[,]” finding that the
former, but not the latter, was sufficient to “rise to a level of [a] shared legal interest.”
Id. at *7.
In Nationwide Mut. Fire Ins., the agreement between the insurer and the
insured provided that the insurer would pay damages up to an amount specified in
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the policy, would provide a defense “at [the insurer’s] expense by counsel of [the
insurer’s] choice,” and could settle the claim at any time and on any terms the insurer
deemed appropriate. 172 N.C. App. at 598, 617 S.E.2d at 43. This Court held that
the insurer and the insured had a shared legal interest in defending against the
underlying claim, relying in part on a North Carolina State Bar Opinion recognizing
that an attorney may enter into dual representation of both an insurer and an
insured. Id. at 602–03, 617 S.E.2d at 45.
Indeed, the primary purpose of an insurance contract is defense and
indemnification. By contrast, an indemnification provision in an asset purchase
agreement is generally ancillary to the sale of a business, and Defendants have
presented no evidence that their agreement with Blast was otherwise. The
agreement and resulting arrangement is almost identical in nature to the cooperation
agreement in SCR-Tech. While Defendants attempt to analogize to the insured-
insurer agreements recognized in Nationwide Mut. Fire Ins., the analogy is
unpersuasive. The indemnification provision in the asset purchase agreement
requires Blast to defend and indemnify Defendants from “[l]osses incurred or
sustained . . . on account of or relating to . . . the use of the [a]ssets by [p]urchaser
and the operation of the . . . [h]ealth [c]lubs . . . .” This language, and the nature of
the asset purchase agreement, are most similar to the purchase agreement which was
held to be insufficient in SCR-Tech to create a tripartite privileged relationship.
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SCR-Tech, 2013 WL 4134602, at *7. Blast is not a party to this litigation. Nor does
Blast have any contractual authority to settle or otherwise affect the outcome of the
suit against Defendants, unlike the insurer in Nationwide Mut. Fire Ins., 172 N.C.
App. at 598, 617 S.E.2d at 43.
Neither this Court nor the North Carolina Supreme Court has extended the
common interest doctrine to relationships formed primarily for purposes other than
indemnification or coordination in anticipated litigation. Cf. Raymond, 365 N.C. at
99, 721 S.E.2d at 924 (law enforcement officer communicated with counsel provided
by professional association, of which he was a member, seeking legal advice regarding
a specific employment dispute that resulted in litigation); Nationwide Mut. Fire Ins.,
172 N.C. App. at 598, 617 S.E.2d at 43 (insurer provided counsel to represent insured
in litigation and maintained the right to settle the case); SCR-Tech, 2013 WL
4134602, at *1 (parties each involved in separate lawsuits against defendant).
Further, we are aware of no precedent indicating that federal courts within the
Fourth Circuit have extended the common interest doctrine to a case “where the
sharing was not done by agreement relating to some shared actual or imminent,
specific litigation.” United States v. Duke Energy Corp., 214 F.R.D. 383, 388
(M.D.N.C. 2003); see also In re Grand Jury Subpoenas, 902 F.2d 244, 249 (4th Cir.
1990) (parent company and its subsidiary had agreement to jointly prosecute contract
claims against U.S. Army). Decisions from other circuits suggest this limitation as
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well. Schwimmer, 892 F.2d at 243; see also McPartlin, 595 F.2d at 1337 (“The
privilege protects pooling of information for any defense purpose common to the
participating defendants.”). Blast’s status as a non-party and the absence of evidence
that this litigation was material to its asset purchase agreement with Defendants
distinguishes this case from decisions relied upon by Defendants for protection
through the common interest doctrine.
We hold that Defendants and Blast shared a common business interest as
opposed to the common legal interest necessary to support a tripartite attorney-client
relationship. Consequently, we hold that the trial court did not abuse its discretion
in compelling Defendants to produce the documents.
AFFIRMED.
Judges STEPHENS and HUNTER, JR. concur.
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