Chelsea Hotel Owner LLC v. City Of New York

Background

This discovery order resolves a dispute about documents withheld in whole or in part by the City of New York as protected by legal privilege or another protection from disclosure. Chelsea Hotel Owner LLC selected 25 documents from the City’s privilege log for the court’s private review. The court reviewed those documents, the parties’ letter briefs, and the parties’ other submissions.

The court ordered the City to produce documents that it found should be disclosed and to reconsider its privilege claims for other withheld documents challenged by Chelsea. Within 14 days after entry of the order, the City must provide Chelsea with a list of documents removed from its privilege log and produce those documents. If disputes remain, the parties must meet and confer in good faith.

General Principles

The court held that, at least for the 25 sample documents, the City did not need to provide additional evidence beyond what it had submitted to support its privilege claims.

The court found that the Department of Buildings and the Department of Housing Preservation and Development shared a common legal interest concerning issues involving the hotel’s classification and status. That common legal interest protects communications between the agencies only when the communications otherwise qualify for protection.

The court distinguished legal advice from policy or public-relations advice. A communication is not protected merely because an attorney participated in it or because the subject involved policy or public statements. Protection applies only to the extent the communication contains legal advice from agency counsel or requests such advice. Legal advice may still be protected when given to policy makers or internal public-relations personnel.

The court explained that attorney work-product protection covers materials prepared because of or in anticipation of litigation that reflect an attorney’s impressions or conclusions. A showing of substantial need generally may overcome work-product protection, but it generally does not overcome attorney-client protection. Chelsea’s general statements about needing the documents did not establish substantial need.

The court found that Chelsea had not generally shown that the City was using privilege both as a shield and a sword or had waived privilege by relying on advice of counsel. The City’s defense that it acted reasonably did not itself waive attorney-client protection. However, the City could not selectively disclose some documents or portions concerning a subject while withholding other documents or portions concerning the same subject based on privilege, absent an independent reason.

The court criticized the City’s changing privilege assertions but declined to strike the late assertions solely because of when they were made. The court also explained that the deliberative-process privilege protects agency documents that are both prepared before an agency decision and related to the process of formulating policy. The privilege is narrow and may not block discovery when the agency’s decision-making process itself is at issue. The court agreed with Chelsea that this privilege did not protect communications about press inquiries after the Office of Administrative Trials and Hearings proceeding was withdrawn, although other protections could apply.

Rulings on the 25 Documents

The court ordered full production of DEF080806, DEF092118, DEF082367, DEF083666, and Priv-WIF-0090. For DEF092118, the court held that the City could not disclose that an inquiry had been made while withholding the response to that inquiry. The court also noted that the document had been ordered produced in the Office of Administrative Trials and Hearings proceeding, although that compelled production did not necessarily waive privilege.

The court held that the existing redactions were appropriate for DEF077204, DEF091694, DEF081025, DEF081027, DEF079551, Priv-WIF-0374, DEF083563, DEF083624, DEF082477, DEF084012, Priv-WIF-0027, and Priv-WIF-0108, subject to the order’s stated explanations. These protections included attorney-client protection, common legal interest, and attorney work-product protection, depending on the document.

The court ordered specific factual or administrative material to be unredacted in DEF084872, DEF091718, DEF082745, and DEF083473. For DEF081488, Priv-WIF-1412, and DEF082670, the court permitted redaction of specified communications by Lundgren and Weithman that provided or sought legal advice, including qualifying draft-statement material. All other portions of those documents had to be produced. The court held that neither work-product protection nor the deliberative-process privilege applied to those documents.

For Priv-WIF-1439, the court ordered production in redacted form: the last substantive paragraph on the page, identified as the second paragraph in Oliveira’s January 21, 2021 email sent at 10:41 a.m., could remain redacted as attorney work product, while the rest had to be produced.

Finally, the court directed the Clerk of Court to terminate Docket Nos. 92, 95, 97, 100, 101, and 110 if any remained open motions.