Behunin v. Superior Court of Los Angeles County
9 Cal. App. 5th 833
| Cal. Ct. App. | 2017Background
- Plaintiff Nicholas Behunin sued Charles and Michael Schwab over a failed real-estate venture (Sealutions) and alleged links between the Schwabs and members of Suharto’s family.
- Behunin’s lawyer, Leonard Steiner, retained public relations firm Levick to create a website ("chuck-you.com") as part of a strategy to pressure the Schwabs to settle; Levick drafted materials and a letter described its goal as deploying strategy and tactics of Behunin’s legal complaint.
- The Schwabs filed defamation and related claims against Behunin (and Steiner), and Behunin moved to strike under California’s anti-SLAPP statute (Code Civ. Proc. § 425.16).
- The Schwabs sought discovery of communications among Behunin, Steiner, and Levick on malice/publication; Behunin asserted attorney-client privilege and submitted documents for in camera review.
- The discovery referee and trial court found Behunin failed to prove communications with Levick were confidential and "reasonably necessary" to the attorney-client relationship; the court ordered production of many communications.
- Behunin petitioned for writ of mandate; the Court of Appeal denied relief, holding privilege did not protect communications disclosed to Levick because Behunin failed to prove disclosure to Levick was reasonably necessary to obtain legal advice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether communications among Behunin, Steiner, and Levick are protected by the attorney-client privilege | Behunin: communications were made for purpose of legal representation and intended to be confidential; Levick was engaged to develop litigation-related strategy | Schwabs: disclosure to a third party (Levick) waived any privilege unless disclosure was reasonably necessary | Held: Privilege did not apply because Behunin failed to prove disclosure to Levick was reasonably necessary to accomplish the purpose for which Steiner was consulted |
| Whether disclosure to Levick was a non-waiving disclosure under Evidence Code § 912(d)/§ 952 (i.e., "reasonably necessary") | Behunin: Levick was a litigation consultant whose involvement was necessary to achieve settlement strategy and to obtain legal advice | Schwabs: Levick was a PR consultant whose communications are not the functional equivalent of counsel or employees; no showing of necessity | Held: Disclosure to Levick was not shown to be reasonably necessary; therefore privilege was waived as to those communications |
| Whether common-interest/agency (joint-defense) or functional-equivalent doctrines preserve privilege | Behunin: Levick shared common litigation interest and/or acted as functional equivalent of an employee/agent, so communications remained confidential | Schwabs: No evidence Levick was agent/employee or shared legal-advice interest; mere aligned commercial interest is insufficient | Held: Common-interest and functional-equivalent doctrines did not apply; Levick had no demonstrated joint legal-interest or employee-like role |
| Whether writ relief was warranted to overturn trial court discovery order | Behunin: trial court abused discretion by compelling privileged materials | Schwabs: trial court acted within discretion; substantial evidence supports privilege waiver finding | Held: Petition for writ denied; appellate review independent on mixed legal/factual waiver issue supported trial court's decision |
Key Cases Cited
- Fireman’s Fund Ins. Co. v. Superior Court, 196 Cal.App.4th 1263 (Cal. Ct. App.) (privilege may justify extraordinary writ review of discovery compulsion)
- Costco Wholesale Corp. v. Superior Court, 47 Cal.4th 725 (Cal. 2009) (standard of review for discovery orders; privilege presumptions)
- McKesson HBOC, Inc. v. Superior Court, 115 Cal.App.4th 1229 (Cal. Ct. App.) (analysis of waiver when communications are disclosed to third parties)
- Citizens for Ceres v. Superior Court, 217 Cal.App.4th 889 (Cal. Ct. App.) (categories where disclosure to third parties may not waive privilege: agents/assistants and aligned common-interest)
- In re Grand Jury Subpoenas Dated March 24, 2003, 265 F.Supp.2d 321 (S.D.N.Y.) (federal case recognizing narrow circumstances where PR consultants’ communications with counsel may be privileged)
- Raytheon Co. v. Superior Court, 208 Cal.App.3d 683 (Cal. Ct. App.) (third-party presence does not destroy confidentiality if disclosure was reasonably necessary)