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Current Developments in the Commercial Divisions of the
New York State Courts by Schlam Stone & Dolan LLP
Posted: June 30, 2018

Court Upholds Common Interest Privilege Claim Relating to Documents That Did Not Relate Solely to Contemplation or Prosecution of Litigation

On June 21, 2018, the First Department issued a decision in Elmrock Opportunity Master Fund I, L.P. v. Citicorp North America, Inc., 2018 NY Slip Op. 04665, upholding a common interest privilege claim relating to documents that did not relate solely to the contemplation or prosecution of litigation, explaining it was affirming an order “to the extent it permitted defendant to withhold from disclosure under the common interest doctrine communications between defendants or their representatives or attorneys and nonparty LDVF I LA Power LLC or nonparty Fortress Investment Group, LLC, or either of their representatives or attorneys, that do not relate solely to the contemplation or prosecution of litigation,” because:

The record demonstrates that the common interest agreement was entered into in reasonable anticipation of litigation. Indeed, plaintiff alleges that defendants breached their duty to protect its interests by failing to commence litigation to establish” the parameters of the appraisers’ valuation determinations. While defendants did not commence such a suit, they entered into the Supplemental Appraisal Protocols, which provided for judicial review of the precise question urged by plaintiff. Plaintiff can hardly claim that litigation that it demanded, and that defendants provided for, could not reasonably have been anticipated. It is of no consequence that defendants ultimately settled the dispute without filing suit.

(Internal quotations omitted) (emphasis added).

An issue that arises in almost all complex commercial litigation is identifying evidence that should be withheld from production in evidence because it is subject to the attorney-client or other privilege. Contact Schlam Stone & Dolan partner John Lundin at jlundin@schlamstone.com if you or a client have questions regarding the attorney-client, common interest, work product or other privileges or exemptions from production of evidence.

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