Underwriters at Lloyd's, In re

• Citation: 666 F.2d 55
• Decision Date: 09 December 1981
• Docket Number: Nos. 81-1372,s. 81-1372
• Parties: In re UNDERWRITERS AT LLOYD'S and British Insurance Companies, Petitioners. FEDERAL LEASING, INC., etc., Appellee, and Kirchner, Moore and Company, et al., Plaintiffs, v. UNDERWRITERS AT LLOYD'S, et al., Appellants, v. SUBURBAN TRUST COMPANY, etc., Appellee, and Federal Leasing, Inc., et al., Counterdefendants. FEDERAL LEASING, INC., etc., Appellee, and Kirchner, Moore and Company, et al., Plaintiffs, v. UNDERWRITERS AT LLOYD'S, et al., Appellants, v. SUBURBAN TRUST COMPANY, etc., Appellee, and Federal Leasing, Inc., et al., Counterdefendants. (L), 81-1395 and 81-1516.
• Court: United States Courts of Appeals. United States Court of Appeals (4th Circuit)

Page 55

666 F.2d 55

In re UNDERWRITERS AT LLOYD'S and British Insurance

Companies, Petitioners.

FEDERAL LEASING, INC., etc., Appellee, and Kirchner, Moore and Company, et al., Plaintiffs, v. UNDERWRITERS AT LLOYD'S, et al., Appellants, v. SUBURBAN TRUST COMPANY, etc., Appellee, and Federal Leasing, Inc., et al., Counterdefendants.

FEDERAL LEASING, INC., etc., Appellee, and Kirchner, Moore and Company, et al., Plaintiffs, v. UNDERWRITERS AT LLOYD'S, et al., Appellants, v. SUBURBAN TRUST COMPANY, etc., Appellee, and Federal Leasing, Inc., et al., Counterdefendants.

Nos. 81-1372(L), 81-1395 and 81-1516.

United States Court of Appeals Fourth Circuit.

Argued Oct. 7, 1981.

Decided Dec. 9, 1981.

John D. Gordan, III, New York City (Eugene F. Bannigan, New York City, Walter C. Alesevich, Lord, Day & Lord, New York City, John E. Sandbower, III, Robert J. Carson, Phillips P. O'Shaughnessy, Smith, Sommerville & Case, Baltimore, Md., on brief), for appellants.

John Doar, New York City, Benjamin Rosenberg, Baltimore, Md. (G. Stewart Webb, Jr., Venable, Baetjer & Howard, Baltimore, Md., on brief), for appellee.

Before BRYAN, Senior Circuit Judge, and PHILLIPS and ERVIN, Circuit Judges.

PER CURIAM:

These appeals are sequels to the litigation detailed in the opinion of this Court in Federal Leasing, Inc. v. Underwriters at Lloyd's, 650 F.2d 495 (CA4 1981). The origin of the controversy is the agreement of March 13, 1978, between Underwriters at Lloyd's (Underwriters) and Federal Leasing, Inc. (FLI), respectively appellant and appellee here. On June 12, 1978, in the Federal District Court for Maryland, FLI sued Underwriters for breach of this agreement, seeking compensatory and punitive damages. On April 17, 1980, the District Judge issued an injunction pendente lite requiring Underwriters to perform its obligations ¹ under the March 13 agreement, 487 F.Supp. 1248 (D.Md.1980); we affirmed, 650 F.2d 495 (CA4 1981).

As events followed toward trial on the merits, FLI made demand upon Underwriters to produce certain documents then in the latter's possession. Upon Underwriters' refusal of these demands, FLI moved the court to compel discovery of these papers. Underwriters resisted the motion, asserting that these documents were not discoverable because they were protected by the attorney-client privilege and the "work product doctrine." The trial judge, on March 3, 1981, overruled Underwriters' objections and ordered the documents produced.

Underwriters' initial response to the District Court's ruling was to move that court to reconsider its decision. The District Judge not only reaffirmed his earlier ruling but, finding that reconsideration was not substantially justified, he ordered Underwriters to pay FLI's counsel fees incurred in responding to the motion pursuant to Rule 37(a)(4) of the Federal Rules of Civil Procedure. Appeal No. 81-1516, consolidated herein, is Underwriters' attempt to have this order reviewed. Following the disposition of its motion to reconsider, Underwriters petitioned this Court for a writ of mandamus directing the District Court to vacate its order compelling discovery. ²

I

The subject of this endeavor is a collection of six documents that divide into three classes. The first comprises an opinion letter of the LeBoeuf law firm, counsel for Underwriters, and a second letter, drafted by an officer of Underwriters' claims adjusters, detailing the LeBoeuf letter. The essence of LeBoeuf's advice was that litigation over FLI's claims be avoided as adverse results were probable. FLI obtained a draft copy of this letter under disputed circumstances; this draft and the final opinion letter are "almost identical." Federal Leasing, Inc. v. Underwriters at Lloyd's, No. H-79-1088, slip op. at 5 (D.Md. March 3, 1981). Upon consideration of affidavits presented by both parties, the District Court concluded that a copy of the draft letter was given voluntarily to FLI's attorney at a time when the parties "were working in a friendly and cooperative manner in an effort to conclude the agreement ...." Id. Hence the letter was not a confidential communication and was not privileged. ³

The second group of documents contains four items relating to two particular claims under the agreement of March 13. The collection of documents submitted for our in camera inspection includes only three of the four documents in this class, each pertaining to the "Dial Financial Bank" claim. ⁴ These three documents consist of two inter-office communications of Underwriters' claims adjusters and one letter from Underwriters to the same firm of adjusters. Underwriters claims that certain portions of these papers referring to advice rendered by LeBoeuf were privileged; here the gist of the advice was that the claim was presently payable.

The District Judge found that copies of these documents were "indiscriminately distributed among the various files of defendants and their agents," thus defeating any claim that the material was confidential. He went further to rule that, even had Underwriters kept a tighter rein on these documents, "the communications in question do not have the effect of revealing a confidential communication from the client to the attorney.... Advice given by LeBoeuf ... (was) based on information obtained from nonprivileged documents." Slip op. at 4.

The third and final class comprises a single document. According to the District Court, this document

is a memorandum written by an attorney of the LeBoeuf firm reporting on a meeting held between attorneys for Underwriters and officers of Federal Leasing. This communication does no more than report on events that occurred at a meeting attended by representatives of plaintiff as well as representatives of defendants. It does not reveal any privileged communications from either Underwriters or their agent.

Id.

II

The Supreme Court has admonished that "(t)he remedy of mandamus is a drastic one, to be invoked only in extraordinary circumstances." Kerr v. United States District Court, 426 U.S. 394, 402, 96 S.Ct. 2119, 2123, 48 L.Ed.2d 725 (1976). Underwriters' petition urges this Court to invoke such extreme procedures so that we may choose between broad and narrow constructions of the attorney-client privilege. The District Court, however, has made factual determinations that operate to defeat Underwriters' claim of privilege under any of the proffered theories. Because these findings are binding upon this Court unless clearly erroneous, we find that Underwriters' petition falls plainly short of demonstrating the requisite urgency under Kerr.

Underwriters' work product claims present an even weaker basis for mandamus. No question of privilege is involved; the work product doctrine is grounded in policies of fairness and convenience to the parties. These policies are common to all discovery orders, and these claims demand no special consideration. The rule is firmly and universally established that mandamus cannot be used to challenge ordinary discovery orders. See, e.g., City of Cleveland v. Krupansky, 619 F.2d 572 (CA6), cert. denied, 449 U.S. 834, 101 S.Ct. 106, 66 L.Ed.2d 40 (1980); National Bondholders Corp. v. McClintic, 99 F.2d 595 (CA4 1938).

III

Underwriters' attempt to appeal the District Court's award of counsel fees need not...