The opinion of the court was delivered by: Magistrate Judge Morton Denlow
MEMORANDUM OPINION AND ORDER
Before the Court is Defendant General Trust Company's Motion to Compel Production of Documents or, Alternatively, For In Camera Review. [Dkt. 283]. General Trust Company believes that ex parte communications took place between one of Plaintiff Mary Scanlan's attorneys and an officer, director, and trust committee member of Defendant General Trust in violation of Rule 4.2 of the ABA Model Rules of Professional Conduct and the identical Rule 4.2 of the Illinois Rules of Professional Conduct. Pursuant to Fed. R. Civ. P. 37(a), General Trust asks the Court to exercise its discretion and compel production of documents necessary to understand the extent of these communications and any prejudice caused thereby.
On August 17, 2012, the Court ordered Plaintiff's counsel to submit David Grossberg's notes and internal communications describing his communications with Michael Greaves for in camera review. [Dkt. 303]. The Court has reviewed the documents in camera. An oral argument was held on September 10, 2012. For the reasons set forth below, the Court grants the portion of the motion requesting in camera review and denies the portion of the motion asking the Court to compel production of documents including all written materials and communications from within the firm of Scanlan's counsel Schiff Hardin LLP, or with any third parties related to the Michael Greaves communications.
A. The Parties and Non-Party.
Plaintiff Mary Bucksbaum Scanlan ("Scanlan" or "Plaintiff"), individually, as next friend for her children, and derivatively on behalf of General Trust, has sued attorneys Marshall Eisenberg, Earl Melamed and Neal, Gerber & Eisenberg (the "Lawyer Defendants") and the trustee of her trusts, General Trust Company ("General Trust"). Eisenberg and Melamed were directors and officers of General Trust and also represented General Growth Properties ("General Growth"). Plaintiffs allege that General Trust imprudently purchased additional shares of General Growth stock and made loans to General Growth insiders. Plaintiffs also allege that the Lawyer Defendants engaged in legal malpractice and breached their fiduciary duties arising out of events that took place in 2007 and 2008.
Plaintiffs are represented by Schiff Hardin LLP. In addition to their involvement in this litigation, Schiff Hardin has been retained to advise Scanlan on her personal assets and investments. David Grossberg ("Grossberg"), a Schiff Hardin real estate attorney, is actively involved in the financial advising. General Trust is represented by Sidley Austin LLP. The Lawyer Defendants are represented by Novack and Macey LLP.
B. Communications With MB Investments.
MB Investments LLC ("MB Investments") is the Bucksbaum Family Office (Scanlan is a member of the Bucksbaum family). MB Investments is not a party to this litigation.MB Investments performs multiple tasks for members of the Bucksbaum family, including Scanlan, such as tax services, financial planning and management, and accounting. MB Investments also provides similar services for General Trust. Pursuant to a written Administrative Services Agreement, MB Investments is an agent of General Trust. MB Investments is represented by David C. Craig of the Finley Alt Smith law firm in Des Moines, Iowa.
Michael Greaves ("Greaves") holds positions with both MB Investments and General Trust. At MB Investments, Greaves holds the positions of General Counsel, Managing Director, and Chief Operating Officer. At General Trust, Greaves is a non-employee officer and director.
Upon Scanlan's retention of Schiff Hardin in late 2008 to advise her on her personal assets, Scanlan requested that Greaves meet and cooperate with her Schiff Hardin counsel to provide background information on her assets and any other necessary information. Over the course of several months in late 2008 and early 2009, Grossberg collected information from Greaves and other MB Investments employees regarding Scanlan's assets and trusts. In addition, MB Investments regularly sent copies of Scanlan's quarterly trust reports to Schiff Hardin. See Pl.'s Resp. at Exs. 4, 6.*fn1
C. Sidley Austin Complains to Schiff Hardin.
Scanlan's counsel learned that General Trust was represented in
connection with this litigation on May 12, 2009. On June 21, 2010,
General Trust's counsel sent a letter to Grossberg stating that it had
come to their attention that Grossberg had engaged in conversations
with "certain employees of MB Investments relating to investments made
for certain trusts of which [Grossberg's client] Mary Bucksbaum
Scanlan is a beneficiary...and that are the subject of your client's
pending lawsuit against General Trust Company." Def.'s Br.*fn2
Just three days later, on June 24, 2010, Grossberg responded via letter and stated: 1) it was his understanding that MB Investments was not a represented party; 2) it was his understanding that MB Investments is a separate entity from General Trust; and 3) that the communications were separate from the litigation and it was necessary for him to talk to Greaves and other employees of MB Investments so that he could adequately advise Scanlan. Id. Ex. A-2. In that letter, Grossberg stated that the communications were with regard to current investment and expenditure activity and that such course-of-business communications were separate from the subject of the litigation. Id. Grossberg made clear that he would continue to communicate with MB Investments and ...