Buttonwood Tree Value Partners, L.P. v. R.L. Polk & Co., Inc.
CA No. 9250-VCG
| Del. Ch. | Oct 26, 2021Background
- Plaintiffs (Buttonwood Tree Value Partners and Mitchell Partners) sued R.L. Polk & Co. and related defendants over transactions including two proposed self-tenders (2007, 2008) and a completed 2011 self-tender.
- Dispute over whether communications between company counsel and counsel that included CEO Stephen Polk were protected by attorney-client privilege given Polk’s alleged conflict and possible status as a transactional counterparty.
- The Court (Vice Chancellor Glasscock) issued a memorandum opinion (July 30, 2021) and implementing order (Oct. 8, 2021) concluding privilege did not attach to certain communications because defendants failed to show the common-interest doctrine applied.
- Defendants sought certification of an interlocutory appeal under Supreme Court Rule 42 and a limited stay pending appeal; plaintiffs opposed.
- The Court denied certification and the stay, reasoning the order was a discovery/privilege ruling of limited precedential effect, not a substantial or novel legal question warranting interlocutory review, and declined to depart from precedent refusing interlocutory review of discovery rulings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Oct. 8, 2021 order should be certified for interlocutory appeal under Sup. Ct. Rule 42 (substantial issue of material importance) | Opposed certification; discovery/privilege ruling not suitable for interlocutory review | Order decides substantial, reviewable legal issues that are intertwined with the merits and cannot be undone after disclosure | Denied: discovery/privilege ruling not a substantial issue under Rule 42; interlocutory appeals of discovery orders are exceptional and disfavored |
| Whether communications involving company counsel and CEO Stephen Polk remained privileged under the common-interest/joint-representation doctrine despite Polk’s alleged conflict/counterparty status | Privilege applies only if defendants meet burden showing Polk’s legal interests were parallel and non-adverse to the company | Polk and defendants argued the common-interest doctrine preserved privilege despite Polk’s involvement | Held for plaintiffs: defendants failed to rebut reasonably conceivable allegations that Polk acted as a counterparty with divergent interests; common-interest exception not shown; privilege waived by disclosure to a third party |
| Whether interlocutory review or a limited stay is necessary to serve considerations of justice or prevent irreparable waiver | Opposed stay; discovery should proceed | Urged stay because disclosure would irreversibly waive privilege and appellate review is needed | Denied: precedent disfavors interlocutory review of discovery/privilege orders; stay motion moot after denial of certification |
Key Cases Cited
- Pepsico, Inc. v. Pepsi-Cola Bottling Co. of Asbury Park, 261 A.2d 520 (Del. 1969) (rulings on discovery generally unappealable)
- In re Rinehardt, 575 A.2d 1079 (Del. 1990) (discovery orders implicating privilege are ordinarily not subject to interlocutory appeal)
- Certain Underwriters at Lloyd’s London v. Monsanto Co., 599 A.2d 412 (Del. 1991) (refusal to allow interlocutory appeal of fact-dependent privilege-waiver rulings)
- Cordant Holdings Corp. v. Moore Bus. Forms, Inc., 682 A.2d 625 (Del. 1996) (discovery orders generally not appealable even when privilege implicated)
- Moyer v. Moyer, 602 A.2d 68 (Del. 1992) (burden of proving privilege rests on the party asserting it)
- Huang v. Rochen, 550 A.2d 35 (Del. 1988) (standards for interlocutory certification)
- Al Jazeera Am., LLC v. AT&T Servs., Inc., 91 A.3d 561 (Del. 2014) (TABLE) (discussion of interlocutory certification in a unique confidentiality context)
- In re Information Management Services, Inc. Derivative Litigation, 81 A.3d 278 (Del. Ch. 2013) (reaffirming the burden on the privilege-asserting party)