Apotheco Pharmacy Durham LLC v. Ahmed

Background

Apotheco Pharmacy Durham LLC and Apotheco, LLC moved to compel Hassan Ahmed to return 435 documents that had been withheld during a document-collection and review process established by the Court’s December 6, 2024 order. The process used Capsicum Group as a neutral forensic vendor and was intended to identify and return Apotheco property, while excluding Ahmed’s personal property and attorney-client communications.

Apotheco argued that the log of withheld documents did not provide enough information to determine whether the documents were properly withheld. It also argued that the documents were likely Apotheco property because their files contained the terms “Apotheco” or “Apotheco.” Ahmed opposed the motion, asserting that all 435 files disclosed privileged information and had been withheld consistently with the Court’s order. He also said that revealing the original file names, or the sequence and selection of documents sent to his attorney, would disclose attorney-client communications or attorney work product.

On February 10, 2025, the Court granted in part and denied in part Apotheco’s request for an in camera review. The Court did not order a comprehensive review of the documents themselves. Instead, it ordered Capsicum to provide the Court ex parte with an unredacted version of the document log showing the original file names. Capsicum provided that log on February 11, 2025.

Attorney-Client Privilege

Attorney-client privilege protects confidential communications between a client and attorney made to obtain or provide legal advice. After reviewing the original file names, the Court concluded that the file names for documents Apotheco-Withheld001 through Apotheco-Withheld010 and Apotheco-Withheld393 through Apotheco-Withheld435 constituted privileged communications from Ahmed to his attorney. The Court therefore found that those file names were properly redacted.

The file names for documents Apotheco-Withheld011 through Apotheco-Withheld392 were nondescriptive Bates-range file names and did not themselves reveal attorney-client communications. The Court nevertheless held that those documents and their selection were protected by the work-product doctrine.

Work Product

The work-product doctrine protects materials that reveal an attorney’s mental impressions, opinions, or legal theories concerning litigation. The Court applied the selection-and-compilation exception, which can protect otherwise unprotected documents when an attorney specifically selects and compiles them in anticipation of litigation and producing them would reveal the attorney’s developing strategy.

Although the Court did not examine the 435 underlying documents, it concluded from the log and its knowledge of the matter that the documents had been collected for transmission to counsel in anticipation of litigation at an attorney’s direction. The Court determined that producing either an unredacted log or the documents themselves would reveal protected attorney strategy. It therefore did not require Ahmed to provide an updated log with the file names unredacted.

Disposition

The Court denied Apotheco’s motion to compel the return of the 435 documents. Because the documents were protected, they would not be returned under the meaning of the Court’s prior orders. However, those prior orders continued to prevent Ahmed from using Apotheco documents in the operation of Ebers Pharmacy or any other similar business.

The Court stated that this result balanced the public interest in preserving attorney-client and work-product protections against Apotheco’s commercial interest in its business documents and trade secrets. The parties were ordered to submit a joint letter by March 3, 2025, stating whether they were prepared to proceed to arbitration or, alternatively, proposing next steps.