LD v. United Behavioral Health

Background

The plaintiffs moved to compel discovery from MultiPlan and sought sanctions under Rule 37 of the Federal Rules of Civil Procedure. A prior order addressed the plaintiffs’ request for preclusion sanctions against other defendants. This order addressed the remaining disputes concerning the adequacy and timing of MultiPlan’s privilege log, produced on July 22, 2022.

The log covered documents that MultiPlan withheld under attorney-client privilege and the work-product doctrine, which can protect materials prepared for litigation. Plaintiffs argued that MultiPlan waived those protections by producing the log after the July 15 fact-discovery cutoff and more than 30 days after most of its document productions. They also argued that the log was too vague, that some documents appeared to concern business purposes or plan administration, and that MultiPlan had not shown that work product was prepared for specific, imminent litigation.

MultiPlan opposed the motion. It argued that the delay did not waive its protections and that its log, together with a declaration from its senior counsel, adequately supported the claims. MultiPlan also argued that the fiduciary exception did not apply and that work-product protection could cover documents prepared for an administrative or governmental matter.

Waiver Based on Delay

Applying the case-by-case factors required by Burlington Northern & Santa Fe Railway Co. v. U.S. District Court, the court held that MultiPlan had not waived all privilege and work-product protections because of the delayed log. The court found that the log’s lack of detail and the timing of its production favored waiver. MultiPlan had produced 3,274 documents, according to plaintiffs, and its log covered approximately 600 documents. But the court also considered that production occurred on a rolling basis and that the log was produced one week after MultiPlan’s final document production. The court concluded that waiver would be too drastic a sanction under the circumstances.

Adequacy of the Privilege Log

Although the court declined to find blanket waiver, it found substantial problems with the log and MultiPlan’s supporting declaration. Several descriptions were boilerplate or too vague to allow plaintiffs or the court to determine whether the documents contained legal advice, whether attachments were independently protected, or whether communications involved attorneys in a legally significant role.

The court also found that the materials did not adequately establish that communications involving pricing methodology were primarily legal rather than business communications. Because the case involved claims concerning plan administration and MultiPlan’s role in pricing, the court found a significant likelihood that some documents could fall within the fiduciary exception to attorney-client privilege. That exception can prevent a plan fiduciary from withholding certain communications from plan beneficiaries concerning plan administration.

The court further found that MultiPlan’s repeated references to litigation were too vague. MultiPlan did not identify the specific litigation or provide enough information to show that litigation was pending or imminent. The court therefore could not determine whether the documents qualified as work product or were outside the fiduciary exception.

Governmental Investigations and Work Product

The court rejected MultiPlan’s broad reliance on a “confidential governmental investigation.” It explained that a governmental investigation does not automatically make related materials protected work product. The relevant inquiry is fact-specific and depends on whether the proceeding was adversarial and whether the documents were prepared primarily because of pending or imminent litigation. The court also noted that voluntary disclosure to a government agency can waive protection, even if the disclosure was made under a confidentiality agreement. MultiPlan had not provided enough information to determine whether disclosure had occurred or whether the claimed protections otherwise applied.

Ruling and Required Steps

The court granted the motion in part, finding that MultiPlan had not sufficiently justified its privilege and work-product claims as to the documents listed on its log. It ordered MultiPlan to produce a revised privilege log by October 14, 2022, consistent with the guidance in the order. The parties had to meet and confer and report on whether they could narrow the dispute by October 24, 2022. If disputes remained, plaintiffs had to identify 50 withheld documents for possible in-camera review, meaning review by the judge privately, and MultiPlan had to electronically lodge documents selected for review by October 28, 2022.