United States District Court, N.D. Illinois
April 28, 2004.
UNITED STATES OF AMERICA, ex rel. FAYE FIELDS and ANN CRAFT, Relators,
SHERMAN HEALTH SYSTEMS; HEALTH VISIONS, INC.; SHERMAN FAMILY HEALTH CARE; ANIL KHEMANI and MRUNAL PANCHAL, Defendants
The opinion of the court was delivered by: MATHEW KENNELLY, District Judge
MEMORANDUM OPINION AND ORDER
The Court has reviewed certain documents submitted by defendant Sherman
Health Systems for in camera inspection to determine whether they are
protected by the attorney-client or work-product privileges. The documents
evidently were obtained by relator Faye Fields during her employment at
Sherman and then given to her counsel. Sherman seeks a determination that
the documents are privileged; if they are, it may seek further relief.
The attorney-client privilege "protects confidential communications
made between clients and their attorneys for the purpose of securing
legal advice." In re A Witness Before the Special Grand Jury 2000-2,
288 F.3d 289, 291 (7th Cir. 2002). Its purpose is "to encourage `full and
frank communication between attorneys and their clients and thereby
promote broader public interests in the observance of law and the
administration of justice.'" Swidler & Berlin v. United States,
524 U.S. 399, 403 (1998) (quoting Upjohn Co. v. United States,
449 U.S. 383, 389 (1981)). Though the privilege generally covers only statements made by
the client, "statements made by the lawyer to the client will be
protected in circumstances where those communications rest on confidential
information obtained from the client, or where those communications would
reveal the substance of a confidential communication by the client."
Rehling v. City of Chicago, 207 F.3d 1009, 1019 (7th Cir. 2000)
The work product doctrine protects materials prepared "in anticipation
of litigation." See, e.g., Logan v. Commercial Union Ins. Co., 96 F.3d 971,
976 (7th Cir. 1996); Binks Mfg. Co. v. Nat'l Presto Indus., Inc.,
709 F.2d 1109, 1118 (7th Cir. 1983). The test is "`whether, in light of
the nature of the document and the factual situation in the particular
case, the document can fairly be said to have been prepared or obtained
because of the prospect of litigation.'" Binks, 709 F.2d at 1118 (quoting
8 C. Wright & A. Miller, Federal Practice & Procedure (Civil) § 2024).
Materials prepared in the ordinary course of a party's business, even if
prepared at a time when litigation was reasonably anticipated, are not
protected work product. Id. at 1119.
The burden of establishing that a document or communication is
privileged lies with the party asserting the privilege. See, e.g., United
States v. BDO Seidman, 337 F.3d 802, 811 (7th Cir. 2003). "The mere
assertion of a privilege is not enough; instead, a party that seeks to
invoke the attorney-client privilege has the burden of establishing all
of its essential elements." In re Grand Jury Proceedings (Thullen),
220 F.3d 568, 571 (7th Cir. 2000); see also, e.g., United States v.
Evans, 113 F.3d 1457, 1461 (7th Cir. 1997). The privilege must be
asserted and demonstrated on a document-by-document basis. See, e.g., In
re Grand Jury Proceedings (Thullen), 220 F.3d at 571.
The first and fifth documents submitted by Sherman are two copies of a
memorandum entitled "Sherman Health Systems, Task Force Meeting #1, Contracting,
October 1, 1998." The only facts Sherman cites in support of its
privilege claim are that the memorandum includes the notation, "Privileged
and Confidential Subject to Attorney-Client Privilege and Attorney Work
Product Doctrines," and that it addresses, among other things, procedures
for monitoring government regulations and implementing compliance
standards. This is insufficient to even begin to establish that the
document is protected by privilege. Inclusion of a "privileged" notation
tells the Court nothing about the circumstances under which the
memorandum was prepared, and it should be self-evident that discussion of
regulatory matters does not necessarily imply that a lawyer was in any
way involved, let alone that the other requirements for privilege
protection are satisfied. Because Sherman has offered no evidence to
support its privilege claim, the claim is rejected.
The second document is an excerpt from what might well be an attorney's
billing statement to Sherman. If that is in fact what the document is, it
may well disclose the contents of matters communicated by Sherman to its
attorney, namely the specific subjects on which Sherman sought counsel's
advice. But the Court will not simply assume, in the absence of evidence,
what the document is. Because Sherman's description of this document is
unsupported, the privilege claim is rejected.
The third document is a two-sentence memorandum stating that an
attached set of minutes have been "blessed" by someone named Urooj
Mahmud; the fourth document appears to be the minutes in question.
Sherman says that Mahmud was an attorney at the law firm of Foley &
Lardner. That does not make the memorandum privileged. It does not
disclose any privileged communications, and there is no indication that
it was prepared in anticipation of litigation. The same is true of the meeting minutes. The minutes reflect that Mahmud was
present at the meeting, but that by itself does not assist Sherman. "[T]he
mere presence of an attorney at a meeting does not render the notes of
the discussion privileged unless they reflect communications made to
obtain his advice." Duttle v. Bandler & Kass, 127 F.R.D. 46, 52
(S.D.N.Y.1989). Nothing in the minutes reflects that they disclose
communications to counsel made for the purpose of obtaining legal
advice, and Sherman has provided no independent support for its privilege
claim. And the fact that Mahmud may have reviewed the minutes is
irrelevant; a party cannot make an otherwise unprotected document
privileged simply by having a lawyer review them. The privilege claim is
The sixth document is a memorandum by two otherwise unidentified
Sherman personnel to the "Corporate Compliance Committee" dated July 26,
1999. The memorandum discusses the status of negotiations with two
prospective employees and a prospective lender. With regard to one of the
matters referenced, the memorandum states that the deal will not be
finalized unless it is approved by counsel. But the memorandum does not
reflect that it is addressed to counsel for the purpose of obtaining
legal advice or that it discloses privileged communications, and Sherman
has submitted no other support for its privilege claim. The Court cannot
simply assume, as Sherman proposes, that any memorandum to something
called a "Corporate Compliance Committee" is automatically privileged.
The privilege claim is rejected.
Document seven is an April 27, 1999 memorandum to the "Compliance
Committee" from its apparent chairperson. It references draft contracts
that the memorandum says were prepared by counsel and briefly summarizes
their terms. Nothing in the memorandum suggests that it discloses
privileged communications. Sherman says that one of the five persons
listed at the bottom of the memo as receiving copies is an attorney, Kevin Egan of
Foley & Lardner. But the fact that a memorandum was sent to an attorney
does not by itself make it privileged. As our colleague Judge Milton
Shadur has stated, "the mere presence of a lawyer's name at the top or
bottom of a document is not the bell that causes the dog named Privilege
to salivate. What is entitled to protection is really limited to the
communication of confidences from client to lawyer, whether any such
confidences (or sometimes the fact that confidences have been
communicated) [are] disclosed in a client-authored document or a
lawyer-authored response." Nedlog Co. v. ARA Servs., Inc., 131 F.R.D. 116,
117 (N.D. Ill. 1989). Again, Shermanhas submitted no other evidence
supporting its attorney-client and work-product privilege claim. The
privilege claim is rejected.
Document eight, a letter from attorney Mahmud to a representative of
Sherman dated January 12, 1998, reflects on its face that it was prepared
by counsel. The letter also arguably discloses the contents, or at least
the subject matter, of a privileged communication by counsel. The Court
agrees with the claim of privilege.
Document nine is a memorandum and a fax cover sheet that on its face
reflects that it was transmitted to counsel in order to obtain legal
advice. The Court agrees with the privilege claim.
Finally, document ten is an e-mail dated May 17, 1999 from a Sherman
employee that on its face reflects that it was sent to attorney Mahmud
and to a medical doctor who apparently was employed by Sherman. The
e-mail discloses the contents a conversation with a non-lawyer. Though
the e-mail was sent to an attorney, Sherman has provided no support for
the contention that it was communicated for the purpose of obtaining
legal advice. The fact that an attorney was copied on the e-mail does not
make it privileged. The privilege claim is rejected. Conclusion
As discussed above, Sherman's privilege claim is accepted with regard
to documents eight and nine in its in camera submission of April
5, 2004 and rejected with regard to documents one through seven, and ten.
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