Stopka v. American Family Mutual Insurance
816 F. Supp. 2d 516
N.D. Ill.2011Background
- Plaintiffs Stopka and Chateau Arlington sue American Family for negligence, breach of contract, and promissory estoppel over remediation of fire damage to their Barrington Hills home.
- American Family allegedly issued a $2,000,000 pre-occurrence policy to Complete Flashings; communications allegedly occurred directly with Stopkas and their accountant Wolowicki through agent Gerald Hayes.
- Plaintiffs filed a privilege log with 22 items claimed as attorney-client, work product, or accountant-client privileged; court ordered in camera review of disputed documents.
- Court analyzes privileges under Illinois law for attorney-client and accountant-client, and federal law for work product, in a diversity action.
- Court concludes six emails are protected by work product; accountant-client privilege does not apply; attorney-client privilege applies to some emails where Wolowicki acted as Plaintiffs’ agent; others are not privileged; several items are denied or limited accordingly.
- Order requires production of listed privilege-log items within 21 days.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether six documents are protected by the work product doctrine | Stopka/Chateau argued they are protected as work product. | American Family contends they are not; misapprehend scope. | Six documents protected under work product; motion granted as to these items. |
| Whether the accountant-client privilege applies to the emails | Accounting privilege covers Wolowicki's communications. | Privilege belongs to accountant; Plaintiffs cannot invoke. | Accountant-client privilege not shown; motion granted on accountant-client issue. |
| Whether attorney-client privilege applies to non-attorney emails | Attorney involvement in emails preserves privilege. | Absence of attorney as sender/recipient defeats privilege. | Non-attorney emails not privileged; scope limited; some emails with attorney involvement may be privileged. |
| Whether Wolowicki's role as agent waives the attorney-client privilege | Wolowicki acted as Plaintiffs’ agent, not waiving privilege. | Agency may waive privilege depending on Illinois law. | Wolowicki's agency does not automatically waive privilege; some communications remain privileged under agency doctrine. |
| Whether certain fee/retainer communications are protected by the attorney-client privilege | Retention/fee discussions may be privileged if confidential legal communications. | Fee agreement not a confidential communication; not privileged. | Retention/fee communications not privileged; attorney-client privilege does not apply to these items. |
Key Cases Cited
- Upjohn Co. v. United States, 449 U.S. 383 (Supreme Court, 1981) (attorney-client privilege promotes open legal communications)
- Consolidation Coal Co. v. Bucyrus-Erie Co., 89 Ill.2d 103 (Illinois Supreme Court, 1982) (narrow construction of Illinois attorney-client privilege)
- Equity Residential v. Kendall Risk Mgt, Inc., 246 F.R.D. 557 (N.D. Ill. 2007) ( Illinois privilege interpretation; burden on asserting party)
- PepsiCo, Inc. v. Baird, Kurtz & Dobson LLP, 305 F.3d 813 (8th Cir. 2002) (accounting privilege context; relation to attorney-client principles)
- Lama v. Preskill, 353 Ill.App.3d 300 (Ill. App. Ct. 2004) (attorney-client privilege extends to client’s communications via an agent)
- United States v. Kovel, 296 F.2d 918 (2d Cir. 1961) (third-party assistance may be necessary for obtaining legal services)
- Heriot v. Byrne, 257 F.R.D. 645 (N.D. Ill. 2009) (agency considerations in privilege analysis)
- People v. Doss, 161 Ill.App.3d 258 (Ill. App. Ct. 1987) (Illinois waiver rules when third parties are involved in privileged communications)