Guarantee Insurance v. Heffernan Insurance Brokers, Inc.
2014 U.S. Dist. LEXIS 80757
S.D. Fla.2014Background
- Plaintiff (an insurer) sued its agent and broker alleging negligence and breach of fiduciary duty for failing to timely notify excess carrier Catlin of a prior state claim (the Leon Tort Claim), which led to Catlin’s denial of coverage and Plaintiff’s payment of the Leon settlement.
- Defendants moved to compel production of documents and privilege log; Plaintiff asserted attorney-client privilege and work-product protection over many Leon-related materials.
- Defendants argued privilege was waived under the "at-issue" doctrine because Plaintiff put causation and the reasonableness/merits of the Leon settlement at issue.
- Separately, Plaintiff’s counsel had sent a detailed pre-suit opinion letter (the Klein Letter) analyzing the merits of the Leon claim; Plaintiff shared that letter with its broker (Heffernan) and XL (an E&O carrier), which Defendants say waived privilege/selective disclosure.
- The court held no at-issue waiver of attorney-client privilege or work product protection based solely on Plaintiffs placing causation at issue, but found selective-disclosure waiver as to (1) the Klein Letter itself (attorney-client privilege and work product) and (2) other pre-suit communications on the same specific subject matter (attorney-client privilege limited to pre-suit merits analysis).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether asserting claims that implicate causation effects an "at-issue" waiver of attorney-client privilege under Florida law | No waiver; Florida requires that privileged communications be necessarily used to prove the claim | Waiver; asserting damages tied to settlement and causation places Leon merits and counsel advice in issue | No at-issue waiver of attorney-client privilege under Florida law; causation theory alone insufficient |
| Whether asserting claims that implicate causation effects an "at-issue" waiver of work-product protection under federal law | No waiver; Plaintiff's counsel work product is not necessary to prove Plaintiff's case | Waiver; fairness requires disclosure of protected materials to defend causation | No at-issue waiver of work product; Plaintiff did not place counsel advice/work product directly at issue |
| Whether disclosure of the Klein Letter to broker and insurer waived attorney-client privilege (selective disclosure/common-interest) | No waiver; disclosure was within a common interest and thus preserved privilege | Waiver; sharing with third parties (Heffernan, XL) waived privilege over that subject matter | Waiver: attorney-client privilege waived for pre-suit communications to/from Conroy Simberg concerning pre-suit merits analysis of the Leon claim; common-interest not proven |
| Whether disclosure of the Klein Letter waived work-product protection beyond the letter (subject-matter waiver) | No broad waiver; disclosure should not waive other work-product materials | Waiver at least as to disclosed material and possibly broader | Waiver limited to the Klein Letter itself for work-product protection; no subject-matter waiver of other work-product materials |
Key Cases Cited
- Milinazzo v. State Farm Ins., 247 F.R.D. 691 (S.D. Fla. 2007) (distinguishing state-law attorney-client privilege from federal work-product law in diversity cases)
- Rhone–Poulenc Rorer, Inc. v. Home Indem. Co., 32 F.3d 851 (3d Cir. 1994) (client must affirmatively place attorney advice at issue for waiver; relevance alone insufficient)
- Coates v. Akerman, Senterfitt & Eidson, P.A., 940 So.2d 504 (Fla. 2d DCA 2006) (Florida disfavors at-issue waiver; privilege waived only when privileged communications are necessarily used to prove the claim)
- Coyne v. Schwartz, Gold, Cohen, Zakarin & Kotler, P.A., 715 So.2d 1021 (Fla. 4th DCA 1998) (refusing to find waiver where other counsel's advice was merely relevant to causation/defense)
- Stern v. O'Quinn, 253 F.R.D. 663 (S.D. Fla. 2008) (work-product subject-matter waiver limited; courts should not extend at-issue waiver absent affirmative placement of advice into controversy)
- Alliant Ins. Servs., Inc. v. Riemer Ins. Grp., 22 So.3d 779 (Fla. 4th DCA 2009) (waiver of attorney-client privilege is limited to communications on the same matter once a waiver occurs)