United States District Court, D. Maine
A. WOODCOCK, JR. UNITED STATES DISTRICT JUDGE
connection with their motion for summary judgment, the City
of South Portland and its code enforcement officer
(Defendants) seek to file a document that Portland Pipe Line
Corporation (PPLC) and the American Waterways Operators (AWO)
(collectively, Plaintiffs) contend is an attorney-client
communication and attorney work product. The Defendants move
the Court to conduct an in-camera review of the document to
determine if it enjoys privileged or protected status. Upon
review, the Court concludes that the document is neither
privileged nor protected.
The Document in Dispute
parties' filings indicate that on December 29, 2016, PPLC
filed an application for abatement of property taxes pursuant
to 36 M.R.S. § 841. Pls.' Mot. for Leave to File
Pleading Under Seal, Attach. 3, Application for
Abatement of Property Taxes at 2 (ECF No. 144). In the
application, PPLC asserted that the City of South
Portland's assessment of the value of PPLC's property
was “manifestly wrong” and “substantially
overvalued.” Id. at 3. In support of the tax
abatement application, PPLC and its attorneys at Pierce
Atwood, LLP, jointly engaged a real estate appraiser named
Darrell R. Lloyd, Jr. of IREM Solutions to appraise
PPLC's assets and to prepare an appraisal report.
Pls.' Mot. for Leave to File Pleading Under
Seal, Attach. 1, Pls.' Mem. in Opp'n to
Defs.' Mot. for Leave to File Document in Connection with
Mot. for Summ. J. for Which Privilege is Disputed at 1-3
(ECF No. 144) (Pls.' Opp'n); Defs.'
Mot. for Leave to File Pleading Under Seal, Attach. 3,
Restricted Appraisal Rep. (ECF No. 133)
(Appraisal Report). On May 20, 2016, Mr. Lloyd sent
a draft of his appraisal report to PPLC. Pls.' Mot.
for Leave to File Pleading Under Seal, Attach. 2,
May 20, 2016 Email at 2-3 (ECF No. 144). The
pleadings suggest that PPLC then sent the draft report to
Pierce Atwood for review. See Pls.' Opp'n at
document in dispute (Document) is a two-page excerpt from a
draft of Mr. Lloyd's report. See Defs.' Mot. for
Leave to File Pleading Under Seal, Attach. 2 at 1- 2
(ECF No. 133) (Document). The Document contains Mr.
Lloyd's original text, as well as edits that Pierce
Atwood attorneys made to the text using a word
processor's “track changes” editing tool.
Document at 1-2; Defs.' Mot. for Leave to
File Pleading Under Seal, Attach. 1, Defs.' Mot.
for Leave to File Document in Connection with Mot. for Summ.
J. for Which Privilege is Disputed at 2-3 (ECF No. 133)
(Defs.' Mot.); Pls.' Opp'n at
2-3. The edits include formatting changes, in-line insertions
and deletions, and one comment in the margin.
Document at 1-2; Pls.' Opp'n at
original text of the Document, Mr. Lloyd noted that, given
potential competition from oil shipped via tankers from
Montreal and the anticipated TransCanada pipeline from
Alberta to St. John, PPLC's pipeline could “best be
classified as a distressed asset. It is possible the line
could go idle or possibly be repurposed.”
Document at 2. The Document shows that upon review
of Mr. Lloyd's proposed language, a Pierce Atwood
attorney crossed out the words “or possibly be
repurposed.” Id. Elsewhere in the Document,
Mr. Lloyd wrote, “[c]onsidering the level of
environmental opposition it is unlikely, even if [the
Plaintiffs] win the [pending federal] lawsuit, that the
Portland-Montreal Pipeline will be reversed.”
Pierce Atwood attorney crossed out this statement in its
entirety and added a comment in the margin:
Comment [MM1]: The City is arguing that even
if the ordinance goes away, we won't be able to get our
other approvals, so the matter isn't ripe. They might
cite this text to support that argument. I think [Mr. Lloyd]
should just leave out any guessing as to what the future may
hold for this-the law today is the law that applies to this
appraisal. If the court overturns the law, the appraiser then
can consider whether reversal is likely, and how quickly.
Id. at 2. The Document contains various other
grammatical and minor edits to the language of Mr. Lloyd'
draft. Id. at 1-2.
25, 2016, PPLC emailed Mr. Lloyd and attached the proposed
changes to the draft report. Pls.' Mot. for Leave to
File Pleading Under Seal, Attach. 2, May
25, 2016 Email at 1 (ECF No. 144) (May 25, 2016
Email); Pls.' Opp'n at 6. In the email,
the PPLC representative wrote, “As you know, we are
currently in a federal lawsuit with the City of South
Portland. As such, we need to be extremely careful what we
say in the public domain regarding our business and the
effect the South Portland Clear Skies Ordinance is having on
our business.” May 25, 2016 Email at 1. On
June 3, 2016, PPLC submitted the finalized Restricted
Appraisal Report (Report) to the Assessor's Office of the
City of Portland as part of its tax abatement application.
Appraisal Report at 1-2. The Report incorporated the
edits that the Pierce Atwood attorneys proposed in the
Document. Id. at 6-8.
Discovery and Subsequent Procedural History
Plaintiffs produced the Document to the Defendants as part of
their “e-discovery” submission on July 26, 2016.
Defs.' Mot. at 2. The Plaintiffs designated the
Document as “Document PPLCAWO-0077728” and marked
the Document as “confidential” pursuant to the
Confidentiality Order that the Court entered on June 27,
2016. Document at 1-2; Pls.' Opp'n
at 1, n.1. On August 2, 2016, the Plaintiffs sent the
Defendants a list of documents that the Plaintiffs claimed
were inadvertently produced or required additional privilege
redactions. Defs.' Mot. at 2; Defs.'
Mot. for Leave to File Pleading Under Seal, Attach. 4,
August 2, 2016 Email at 1-5. The list did not
include the Document. Id.
December 19, 2016, in accordance with the Confidentiality
Order, the Defendants notified the Plaintiffs of their intent
to use the Document in connection with their Opposition to
the Plaintiffs' Motion for Summary Judgment.
Defs.' Mot. at 2. The Plaintiffs then asserted a
claim of privilege and work product over the Document.
December 30, 2016, the Defendants filed a motion for leave to
file the Document. Defs.' Mot. The Plaintiffs
responded on January 20, 2017, Pls.' Opp'n,
and on February 10, 2017, the Defendants
replied. Defs.' Mot. for Leave to File
Reply Mem. Under Seal, Attach. 1, Defs.' Reply
Mem. in Resp. to Pls.' Opp'n to Defs.' Mot. for
Leave to File Document (ECF No. 150) (Defs.'
The Defendants' Motion
Defendants explain that the attorney-client privilege
protects confidential communications between a lawyer and a
client made for the purpose of seeking or giving legal
advice. Defs.' Mot. at 4-5 (citing XYZ Corp.
v. United States (In re Keeper of the Records), 348 F.3d
16, 22 (1st Cir. 2003)). They assert that the attorney-client
privilege does not protect the Document for three reasons.
First, they contend that the Document is not a communication
between the lawyer and the client because Mr. Lloyd, a
third-party real estate appraiser, drafted the Document.
Id. at 4. Next, they argue that the Document was not
made for the purpose of seeking or giving legal advice;
rather, the Document “was prepared to support a request
for a municipal tax abatement.” Id. at 5.
Finally, the Defendants allege that the Document is not
confidential due to Mr. Lloyd's involvement in the
purported attorney-client communication. Id. at 5.
Moreover, the Defendants maintain that the limited exception
to confidentiality for necessary third-party consultants is
inapplicable. Id. at 5-6.
Defendants also claim that the work product doctrine does not
protect the Document because the Document was not created by
an attorney or consultant in anticipation of this, or any
other, litigation. Id. at 6-7 (citing United
States v. Textron, Inc., 577 F.3d 21, 29-30 (1st Cir.
2009); In re San Juan Dupont Plaza Hotel Fire
Litig., 859 F.2d 1007, 1014 (1st Cir. 1988)). Further,
the Defendants contend that even if the Document is work
product, the Court should permit the Defendants to use the
Document under Federal Rule of Civil Procedure 26(b)(3),
which allows for discovery of otherwise undiscoverable
information if a party “shows that it has a substantial
need for the materials to prepare its case and cannot,
without undue hardship, obtain their substantial equivalent
by other means.” Id. at 7 (citing Fed.R.Civ.P.
26(b)(3)). The Defendants argue that they have a substantial
need for the Document because it speaks to the
“actual intent” of PPLC and its plans
for the pipeline. Id. According to the Defendants,
the Document confirms that the Plaintiffs'
representations concerning the ripeness of the controversy
are disingenuous. Id. Moreover, the Defendants
assert that they cannot, “without divining the inner
thought processes of PPLC management, obtain this information
from any other source.” Id. Thus, the
Defendants urge the Court to allow them to file the Document
notwithstanding the work product doctrine.
the Defendants allege that the Plaintiffs waived any claim to
protection or privilege by failing to take reasonable
measures to protect the Document and by failing to take
reasonable steps to rectify the disclosure after they
produced the Document. Id. at 8 (citing Fed.R.Civ.P.
502(b)). The Defendants point out that only when the
Defendants brought the Document to the Plaintiffs'
attention did the Plaintiffs' claim protected status, and
therefore, the Plaintiffs have waived any claimed privilege.
The Plaintiffs' Response
Plaintiffs contend that the Defendants' motion
“rests on a series of misapprehensions concerning the
nature of the Document, and PPLC's current and intended
use of it.” Pls.' Mot. at 2. The
Plaintiffs explain that a Pierce Atwood staff person
technically created the Document and that, although Mr. Lloyd
drafted the Document's original text, Pierce Atwood
attorneys were responsible for the comment and the other
in-line edits. Id. at 2-3. Furthermore, the
Plaintiffs allege that PPLC and Pierce Atwood jointly engaged
Mr. Lloyd as an expert to prepare the appraisal reports in
anticipation of what the Plaintiffs describe as
“property tax litigation.” Id. at 3.
Plaintiffs assert that, based on this proper understanding,
the Document is protected under the attorney-client
privilege. Id. at 5-6. They argue that
“counsel for PPLC created the Document and included
within it revisions and comments for the specific purpose of
providing PPLC with legal advice relevant to both the ongoing
litigation over the Ordinance and the then-anticipated
(now-commenced) property tax litigation against the
city.” Id. Additionally, they point out that
the Pierce Atwood attorneys then sent the Document directly