Pentacon BV v. Vanderhaegen

Nature of the Order

This order resolves discovery disputes in a diversity lawsuit brought by Pentacon BV and Baltisse NV. The plaintiffs seek damages for alleged harms from a scheme involving the acquisition and resale of their interests in Origis USA LLC. The order does not revisit the court’s earlier rulings on motions to dismiss or reconsideration.

The parties and two third parties had raised several discovery issues. The dispute involving Global Atlantic and KKR had been resolved for the time being, so the court addressed the remaining disputes.

Communications Involving Baltisse’s In-House Counsel

Defendants sought approximately 2,000 documents that Plaintiffs had listed as protected by attorney-client privilege. The documents involved communications between Baltisse’s in-house counsel, Ann Maurau, and Plaintiffs. Defendants argued that the communications could not be privileged because Maurau was not a licensed attorney under the circumstances described in the submissions.

Applying New York law, the court held that communications between Baltisse and Maurau made to seek or provide legal advice were privileged. The court noted that New York law protects confidential legal-advice communications with both outside and in-house counsel. It also explained that in-house counsel communications must be examined to determine whether their main purpose was legal advice rather than business advice.

The court rejected Defendants’ argument that Belgium’s rules prevented Maurau from providing privileged legal advice. The record stated that a Belgian bar member who becomes a full-time employee of a company must leave the bar, that membership in the Belgian Institute of Company Lawyers was not mandatory, and that a person could hold an in-house legal position and provide legal advice without being a company lawyer. Maurau stated that she had a law degree, had been a member of the Brussels bar before becoming in-house counsel, provided legal advice as Baltisse’s Head of Legal, and remained an inactive Brussels bar member.

The court separately held that Baltisse waived privilege over communications with its in-house or outside counsel that were shared with Pentacon. Plaintiffs relied on the common-interest doctrine, which can preserve privilege when parties share communications to further a common legal interest in pending or reasonably expected litigation. The court rejected that argument because Plaintiffs did not claim that litigation was pending or contemplated when the disclosures occurred. The court also found that Maurau did not simultaneously represent Baltisse and Pentacon on the same matter.

Vanderhaegen’s Communications with Norton Rose

Plaintiffs sought approximately 250 documents involving Guy Vanderhaegen and Norton Rose Fulbright US LLP concerning the buyout of Plaintiffs’ interests, through January 4, 2021. Plaintiffs argued that they were within the group entitled to access privileged communications involving Origis because they had held interests in Origis’s parent and had board seats at Origis entities. They also argued that Norton Rose could not represent Vanderhaegen individually while representing Origis in the transaction.

The court rejected both arguments. It found that Plaintiffs had their own lawyers during the negotiations and were not aligned with Vanderhaegen or Origis. Relying on New York authority, the court reasoned that a corporate insider’s access to corporate privileged communications does not continue when the person is adverse to the corporation in litigation concerning that person’s own interests. The court also distinguished cases involving former directors who had participated in legal consultations and were not adverse to the corporation.

The court agreed that Norton Rose could represent Vanderhaegen concurrently in the transaction and held that his communications with the firm about the transaction were privileged. It therefore denied Plaintiffs’ request for an order requiring production of those communications. The court noted that it would have been prudent for Vanderhaegen to retain separate counsel, but that observation did not change the ruling.

Disposition

The court DENIED Defendants’ request to disclose communications between Baltisse employees and Maurau made to seek or provide legal advice. It GRANTED Defendants’ request to disclose otherwise privileged Baltisse communications with in-house or outside counsel that were shared with Pentacon. It DENIED Plaintiffs’ request to disclose Vanderhaegen’s communications with Norton Rose.

The court also DENIED Defendants’ request to strike Maurau’s declaration. Plaintiffs were ordered to produce the relevant materials within 21 days. The clerk was directed to terminate the pending motions listed in the order and to keep specified docket entries under seal.