Merit Decision: Order Compelling Production of Documents Allegedly Protected by Attorney-Client Privilege is a Final Appealable Order. Darlene Burnham v. Cleveland Clinic, et al.

Update: read what happened on remand in this case here.

On December 7, 2016, the Supreme Court of Ohio handed down a merit decision in Burnham v. Cleveland Clinic, Slip Opinion  2016-Ohio-8000.  Oh my! Let me put it this way. Six justices agreed that the order compelling discovery in this particular case was final and appealable. Beyond that, well, law review writers and civil procedure geeks take up your pens. It’s a 3-3-1 decision.  Justice Lanzinger wrote the lead opinion, joined by Chief Justice O’Connor and Justice O’Neill.  Justice Kennedy wrote the separate concurrence, joined by Justices French and O’Donnell.  Justice Pfeifer dissented. The case was argued May 4, 2016.

Case Background

Darlene Burnham sued the Cleveland Clinic and the Cleveland Clinic Health System (“Clinic”) and some Clinic employees for injuries she sustained when she slipped and fell in her sister’s hospital room at the Clinic. Burnham alleged in her complaint that an employee had poured liquid on the floor and had failed to warn her of the hazard.

During discovery Burnham sought the identification of anyone who had made statements or reports about the accident, and copies of any written statements or reports. The employee involved was identified, but neither party could find her for deposition.  The Clinic refused to produce the incident report, arguing it was protected by various privileges, including attorney-client privilege, the one pertinent to this appeal.

Burnham filed a motion to compel discovery. The trial court reviewed the privilege log, which included a copy of the contested report and an affidavit from a Clinic lawyer averring that the report had been generated as part of Clinic protocol to notify the legal department of events that could be the basis for a lawsuit. The trial court granted Burnham’s motion to compel.

The Clinic appealed the trial court’s order to compel, arguing that the incident report was protected by attorney-client privilege and was not discoverable. In a unanimous decision, the Eighth District held that the Clinic failed to establish that an immediate appeal was necessary, or that it would be prejudiced by the immediate disclosure of the report. Therefore, according to the Court of Appeals, there was no final, appealable order, and the appeal was dismissed.

Read the oral argument preview of this case here, and an analysis of the argument here.

Key Statutes and Precedent

Article IV, Section 3(B)(2) of the Ohio Constitution (Courts of appeals shall have such jurisdiction as may be provided by law to review and affirm, modify, or reverse judgments or final orders of the courts of record inferior to the court of appeals within the district.)

R.C. 2505.02(B)(4) (An order is a final order that may be reviewed, affirmed, modified, or reversed when it is an order that grants or denies a provisional remedy to which both of the following apply: (a) The order in effect determines the action with respect to the provisional remedy and prevents a judgment in the action in favor of the appealing party with respect to the provisional remedy and (b) The appealing party would not be afforded a meaningful or effective remedy by an appeal following final judgment as to all proceedings, issues, claims, and parties in the action.)

R.C. 2505.02(A)(3) (“Provisional remedy” means a proceeding ancillary to an action, including, but not limited to, […] discovery of privileged matter.)

R.C. 2317.02(A) (Ohio’s Codification of Attorney-Client Privilege: (1) An attorney, concerning a communication made to the attorney by a client in that relation or concerning the attorney’s advice to a client… However, if the client voluntarily reveals the substance of attorney-client communications in a nonprivileged context or is deemed by section 2151.421 of the Revised Code to have waived any testimonial privilege under this division, the attorney may be compelled to testify on the same subject…)

Civ.R. 26(B)(6) (Ohio’s Codification of Work-Product Doctrine: (a) Information Withheld. When information subject to discovery is withheld on a claim that it is privileged or subject to protection as trial preparation materials, the claim shall be made expressly and shall be supported by a description of the nature of the documents, communications, or things not produced that is sufficient to enable the demanding party to contest the claim.)

Hickman v. Taylor, 329 U.S. 495, 67 S.Ct. 385, 91 L.Ed. 451 (1947) (the protections of attorney-client privilege do not extend to an attorney’s work or information collected.)

In re Story, 159 Ohio St. 144, 111 N.E.2d 385 (1953) (the protection against discovery of matters identified as “privileged” in Civ.R. 26(B)(1) is limited to those derived from a specific constitutional or statutory provision)

Amato v. Gen. Motors Corp., 67 Ohio St.2d 253, 423 N.E.2d 452 (1981), overruled by Polikoff v. Adam, 67 Ohio St.3d100, 616 N.E.2d 213 (1993) (providing a balancing test to determine whether a special proceeding, and therefore, a final appealable order is involved, by weighing the harm to the “prompt and orderly disposition of litigation,” and the consequent waste of judicial resources, resulting from the allowance of an appeal with the need for immediate review because appeal after final judgment is not practicable. The balancing test is now codified at R.C. 2505.02(A)(2).)

Nelson v. Toledo Oxygen & Equip. Co., Inc., 63 Ohio St.3d 385, 588 N.E.2d 789 (1992) (holding that under the Amato standard, an order compelling production of materials allegedly protected by the work-product doctrine was not a final, appealable order by reasoning that the work-product exemption protects materials that are peculiarly related to litigation, and that any harm that might result from the disclosure of those materials will likewise be related to litigation, thereby allowing for relief to be obtained through appellate review.)

Boone v. Vanliner Ins. Co., 91 Ohio St.3d 209, 744 N.E.2d 154 (2001) (comparing the main purpose behind the attorney-client privilege, which is to promote “full and frank communication between attorneys and their clients and thereby promote broader public interests in the observance of law and the administration of justice with the main purpose of the work-product doctrine, which is “to prevent an attorney from taking undue advantage of his adversary’s industry or efforts.”)

State v. Muncie, 91 Ohio St.3d 440, 746 N.E.2d 1092 (2001) (to show that an order for a provisional remedy such as the discovery of privileged or protected materials is final and appealable, R.C. 2505.02(B)(4)(a) requires a showing that the order determines the privilege issue and prevents a judgment in favor of the appellant regarding that issue, while R.C. 2505.02(B)(4)(b) requires a showing that the harm caused by the privilege-related discovery order cannot be meaningfully or effectively remedied by an appeal after final judgment.)

Jackson v. Greger, 110 Ohio St.3d 488, 2006-Ohio-4968, 854 N.E.2d 487 (The protection of attorney work-product belongs to the attorney, but Civ.R. 26(B)(6) allows the protection to be removed by an opposing party’s demonstration of need for the materials—i.e., a showing that the materials, or the information they contain, are relevant and otherwise unavailable.)

Squire, Sanders & Dempsey, L.L.P. v. Givaudan Flavors Corp., 127 Ohio St.3d 161, 2010-Ohio-4469, 937 N.E.2d 533 (explaining the distinction between attorney-client privilege—a waivable privilege, held by the client, grounded both in common law and R.C. 2317.02(A), the purpose of which is to promote full, frank communications between attorneys and clients—with attorney work-product doctrine, a qualified privilege that protects the mental process of the attorney through common law’s protection of  intangible work-product and the protection for documents, electronically stored information, and tangible things under Civ.R. 26(B)(3).)

Smith v. Chen, 142 Ohio St.3d 411, 2015-Ohio-1480, 31 N.E.3d 633 (Neither the Ohio Supreme Court, nor the courts of appeals has jurisdiction to consider the merits of an interlocutory order that is not final and appealable. An order granting or denying a provisional remedy is final and appealable only if it complies with both prongs of R.C. 2505.02(B)4). For an order granting discovery of privileged matter to be a final order, an appellant must affirmatively establish that an immediate appeal is necessary in order to afford a meaningful and effective remedy. A mere assertion that disclosure would preclude a meaningful remedy is not good enough.)

Merit Decision

Executive Summary

Tell Us Again What This Case is About?

Justice Lanzinger frames the issue in this case as “whether an order compelling the production of documents allegedly protected by the attorney-client privilege is a final, appealable order under R.C. 2505.02(B)(2).”

Short answer: yes.

Secondarily, the court decided it needed to clarify its holding in Smith v. Chen. There is no short answer for this.

Points of Agreement

Six justices agree that an order compelling the production of documents allegedly protected by the attorney-client privilege is a final, appealable order under R.C. 2505.02(B)(2). The lead opinion explicitly holds that in this case, the Clinic “plausibly alleged that the attorney client privilege would be breached by disclosure of the requested materials.”

Points of Disagreement

The justices in the lead opinion believe that compelling production of documents covered by attorney-client privilege causes immediate harm and prejudice that cannot be undone by a later appeal, while documents covered by the work-product doctrine might not, and therefore might require a showing beyond a statement that the matter is privileged. The separately concurring justices think documents covered by attorney client and work product privilege both cause immediate harm that cannot be undone by a later appeal, and should require the same showing to be protected.

The justices in the lead opinion think Smith v. Chen is only implicated with work product documents, not attorney-client privileged documents, and is thus limited to its facts.  The separately concurring justices think Smith v. Chen is implicated here, was wrongly decided, and should be overruled.

Justice Pfeifer thinks the incident report was nothing more than an ordinary business record, was not privileged, and can be reviewed in the ordinary course of a regular appeal, period.

Legal Analysis

“Clarifying” Smith v.Chen ?

Chen involved a video surveillance recording made by Chen’s lawyer for impeachment purposes in a medical malpractice case. Chen argued the video was privileged as attorney work product. The trial court ordered the video turned over to the plaintiff, under the “good cause shown” provision of Civ. R. 26(B)(3). While acknowledging that discovery orders are generally not final and appealable, the Tenth District Court of Appeals held that it had jurisdiction over discovery orders that are privileged, which included work product. So it heard the appeal and upheld the trial court’s order.

The Supreme Court of Ohio accepted jurisdiction over Chen to decide whether compelling production of the video violated the work product doctrine, but then got bogged down in whether and why the case should be dismissed for lack of a final appealable order, and a lot of finger-pointing as to who did or didn’t brief  or argue what.  If you love this sort of thing, read the Chen decision.  Justice O’Neill wrote it, which is undoubtedly why he signed on to the lead opinion in Burnham. The line-up in Chen was the same as in Burnham, minus Justice Pfeifer, who in Burnham parted company with Chen majority Justices Lanzinger, O’Neill and the Chief .

According to the lead opinion in Burnham, Chen only applies to the work-product doctrine, not to attorney client privilege. Burnham is an attorney-client privilege case, not a work-product case, so Chen does not apply, despite involving the same statutory language.

In response, Justice Kennedy believes limiting Chen to work product materials, but not materials covered by attorney-client privilege, is without any basis. Instead, the court should use the three-part test established (but seldom used!) in Westerfield Ins. Co. v. Galatis about when to overrule existing precedent, and overrule Chen completely. Chen was wrongly decided, is difficult to apply, and has been inconsistently applied by the lower courts.

Attorney Client Privilege versus Work Product

Justice Lanzinger says this:

“The attorney-client privilege and the attorney-work-product doctrine provide different levels of protection over distinct interests, meaning that orders forcing disclosure in these two types of discovery disputes do not necessarily have the same result that allows an immediate appeal.” She goes on to say that an order compelling production of information protected by the attorney client privilege is prejudicial and cannot be fixed later on appeal. But other kinds of discovery protections, including work product, require more than the mere statement that the matter is privileged.

And this:

“The concurring justice would have us overrule Chen and treat attorney work- product and attorney-client privilege the same. But the attorney client privilege and the attorney work-product doctrine do not share the same origins or occupy the same provisions of statutory or common law.” Attorney-client privilege is to foster complete and honest communication between lawyers and clients.  The work product doctrine is to keep a lazy lawyer from pilfering an industrious lawyer’s efforts.

The lead opinion then goes on, for many paragraphs, explaining why the work product doctrine and attorney client privilege may overlap sometimes, but are not the same. And while the work product doctrine is popularly called a privilege, technically, says Lanzinger, it isn’t. Attorney work product just isn’t on the same footing as “a client’s substantive right to confidentiality.”

Rejoinder from Justice Kennedy:

The court’s opinion is “incomplete and disingenuous.” It fails to recognize the common-law origins of the work-product doctrine, which the separate concurrence spends many paragraphs explaining. It ignores the fact that Civil Rule 26 “provides protection to a broader class of documents and materials than does the attorney-client privilege,” which the separate concurrence spends many more paragraphs explaining, from the enactment of the Federal Rules of Civil Procedure to Hickman v. Taylor, to the enactment of the Ohio Rules of Civil Procedure.

And here is the crux of Kennedy’s criticism:

“With this decision, the court opinion systematically declares that a document allegedly privileged under the work-product doctrine does not meet the standard established in R.C. 2505.02(B)(4)(b) unless some special showing is somehow made…A released document never regains privileged status. The ‘proverbial bell cannot be unrung.’”

Justice Pfeifer’s Dissent

I’m really going to miss Justice Pfeifer’s voice when he retires at year’s end:

“I dissent from elevating the incident report in this case to the exalted status of being the product of attorney-client privilege, requiring the immediate intervention of the appellate court to protect the Cleveland Clinic from what exactly—the disclosure of its top-secret ratio of water to Mop & Glo? This was a run-of-the-mill, wet-floor, slip-and-fall case that generated an automatically produced report, a business record that involved in its production no interaction between the client and its in-house or outside counsel; its purpose was to notify the risk-management and law departments of an event that might result in legal action.”

What Exactly is the Disposition of this Case?

The court of appeals decision dismissing the case as not a final appealable order was reversed. The case was sent back to the appeals court to determine the merits of the Clinic’s appeal, which was that the incident report should not have been produced. So, the Clinic hasn’t won yet on the merits, and Justice Pfeifer may yet have his way.

Case Syllabus

None!

Concluding Observations

Here’s what I wrote after argument:

Looks “like a win for the Cleveland Clinic, probably by a vote of 5-2, on the ground that there is a final appealable order in this case. I think the court is going to re-iterate its longstanding view that an order compelling disclosure of allegedly privileged information is a final appealable order, and will clarify that no affirmative showing of prejudice need be made by the party asserting the privilege in order to be entitled to an interlocutory appeal under R.C. 2505.02(B)(4). The court will likely state that prejudice is inherent from the disclosure of a privileged document, and once disclosed, the bell cannot be unrung. The court may advise trial courts to state specific reasons for why the information sought is or is not privileged, so an appeals court can better determine whether both prongs of R.C. 2505.02(B)(4) are met.”

Final appealable order jurisprudence has always given me a headache. And this decision doesn’t really help.

I completely agree that disclosure of truly privileged material of any sort should get an immediate interlocutory appeal. But the mere statement that something is privileged—whether by attorney-client, work product, or another form of protection, should never just make it so.  I think that was what Chen was getting at.  And just because a lawyer is involved in some manner with a document, or stamps it “privileged” does not mean the document is privileged.

Justice Lanzinger thinks that a more heightened showing may be needed when privilege is asserted with documents claimed to be protected by work product than by attorney-client privilege.  Justice Kennedy thinks they should be treated the same way, and does not seem to think a special showing is needed for either.  I think some showing beyond a conclusory statement should be required for both. While the lead opinion seemed satisfied that the Clinic “plausibly alleged” enough to that show attorney client privilege would be breached by the disclosure of the incident report, I don’t know what that means.  I agree with Justice Pfeifer that the incident report in this case is nothing more than a record kept in the ordinary course of business and isn’t entitled to be classified as attorney-client privilege or work-product privilege.

I’m also not sure what limiting Chen to its facts means. That its holding applies only to work product used for impeachment? And of course only three justices voted to limit it to its facts, so I’m not sure what that means, either, for its use in future cases.

In the end, we need to rely on the discretion of our trial judges, who should indeed make a careful, articulated analysis in ruling on allegedly privileged documents. Justice Lanzinger urges trial courts to explain why a motion to produce has been granted, to allow meaningful appellate review. In this case the trial judge apparently did not do that. Although not implicated here, I think trial courts should also elaborate on exactly why motions to produce are denied, and in both instances, something more than conclusory statements should be required from the party seeking protection.

 

 

 

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