Gartner, Inc. v. HCC Specialty Underwriters, Inc.

Background

Gartner sued U.S. Specialty Insurance Company and HCC Specialty Underwriters, Inc. in No. 20-CV-4885 over losses from COVID-19-related event cancellations. Gartner also sued Aon/Albert G. Ruben Insurance Services, Inc., its insurance broker, in No. 22-CV-7000 for losses not covered by its policies with the insurers.

Gartner and Aon jointly asked the court to review twenty documents that the HCC Defendants withheld as protected by the work-product doctrine or attorney-client privilege. The court ordered the HCC Defendants to produce the documents for private judicial review.

Work-Product Protection

The work-product doctrine generally protects documents and tangible things prepared because of litigation or in anticipation of trial, subject to limited exceptions. The court reviewed all twenty documents and found that they were created after the lawsuit was filed and reflected mental impressions, opinions, and conclusions prepared because of or in anticipation of the litigation.

The court rejected the argument that the documents were created in the ordinary course of the insurers’ business. It found that the documents belonged instead to the category of materials prepared in anticipation of litigation and were therefore protected.

Disclosure to Third Parties

Gartner and Aon argued that the HCC Defendants waived work-product protection by disclosing the documents’ contents to reinsurers, a reinsurance broker, and an adjuster. The court explained that disclosure to a third party does not automatically waive work-product protection. Waiver occurs when disclosure is inconsistent with the protection’s purpose or substantially increases the opportunity for potential adversaries to obtain the information.

The court found that the HCC Defendants had shown that the reinsurers shared a common legal interest because they could face liability for a judgment against, or settlement entered into by, the HCC Defendants. After reviewing the documents, the court also found that the communications were made to develop a common legal strategy. The court therefore held that the HCC Defendants had not waived work-product protection.

Need for Production

Work-product materials may sometimes be discoverable when the requesting party shows substantial need and cannot obtain the equivalent information without undue hardship. But legal opinions, mental impressions, conclusions, and legal theories receive absolute protection under the federal discovery rule.

Gartner and Aon argued that the documents might show that the HCC Defendants’ earlier understanding of the insurance contracts conflicted with their later litigation positions. The court did not decide whether Gartner and Aon had shown substantial need or undue hardship. Instead, it held that the documents could not be disclosed because they contained opinion work product covered by absolute protection.

Disposition

Judge Dale E. Ho ordered that Gartner and Aon’s request to compel production of the documents listed in the HCC Defendants’ privilege log was DENIED. The clerk was directed to docket the order in both related cases.