Fulton v. Honkamp Krueger Financial Services, Inc.
- Patrick Schiltz
- 0:20-cv-01063
- U.S. District Court · District of Minnesota
- 11
In Fulton v. Honkamp Krueger, Judge Schultz denied a motion to compel testimony but allowed focused follow-up deposition questions about privilege.
Honkamp Krueger Financial Services, Inc. may continue Annie Taylor’s deposition with narrow, specific questions; Mariner, LLC must address those questions subject to the privilege limits described by the court.
What happened
In Fulton v. Honkamp Krueger Financial Services, Inc., Honkamp Krueger asked the court to require Mariner’s in-house lawyer, Annie Taylor, to answer questions about communications concerning outside counsel’s opinion that Aaron Fulton’s restrictive covenants were unenforceable. Mariner had relied on that opinion as part of its defense to Honkamp Krueger’s claim that Mariner improperly interfered with its contract with Fulton.
The court found that the questions Honkamp Krueger identified were too broad because they could require Taylor to reveal protected communications about litigation strategy. The court said Honkamp Krueger could instead ask narrow, specific questions distinguishing advice about whether the covenants were enforceable from advice about litigation strategy. The court also noted that Taylor had provided additional factual information in a declaration.
Judge Schultz denied Honkamp Krueger’s motion to compel testimony. The court nevertheless allowed Honkamp Krueger to continue Taylor’s deposition with specific questions consistent with the order if it was not satisfied with her declaration and earlier answers.
The detailed version
- Fulton v. Honkamp Krueger Financial Services, Inc. · No. 0:20-cv-01063
- Patrick Schiltz
- Mar. 24, 2021
Background
Honkamp Krueger Financial Services, Inc. (HKFS) sued Mariner, LLC for tortious interference with contractual relations involving HKFS’s then-employee, Aaron J. Fulton. Mariner asserted an advice-of-counsel defense, contending that it reasonably relied on outside counsel John Ella’s opinion that the restrictive covenants in Fulton’s agreements with HKFS were unenforceable.
HKFS deposed Mariner’s in-house counsel, Annie Taylor, about Mariner’s communications with Ella concerning Fulton’s employment before May 3, 2020. Taylor answered some questions but declined to answer others when she or her counsel believed the questions called for attorney-client privileged communications concerning litigation strategy. HKFS adjourned the deposition and moved to compel further testimony.
Analysis
The court explained that asserting an advice-of-counsel defense waives attorney-client privilege for communications and documents relating to the advice at issue. Here, that waiver covered communications about the enforceability of the restrictive covenants. It did not extend to communications concerning litigation strategy.
The court found that three questions identified by HKFS—asking Taylor to “summarize” or state “the substance” of conversations—were overly broad. Those questions could encompass both discoverable communications about the enforceability advice and protected communications about litigation strategy. The court also found that Taylor’s testimony did not show a blanket refusal to testify about the relevant subject. Instead, her refusals responded to the breadth of HKFS’s questions and her belief that the conversations involved litigation strategy.
The court stated that HKFS could ask focused, step-by-step questions to determine whether particular communications concerned the substance of Ella’s advice or instead involved litigation exposure, risk assessment, or litigation strategy. The court did not decide whether the information Taylor provided was sufficient to establish Mariner’s reasonable reliance under Minnesota law.
Disposition
The court denied HKFS’s Motion to Compel Deposition Testimony. It allowed HKFS to continue Taylor’s deposition with specific questions consistent with the order if HKFS was not satisfied with the information in Taylor’s declaration and previous deposition answers.
Read the full 11-page opinion on CourtListener, the free public archive maintained by the Free Law Project.