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Uniting Plaintiff, Defense, Insurance, and Corporate Counsel to Advance the Civil Justice System

Summer 2015

Carbon nanotubes (CNTs) holdpromise for many beneficialapplications. However, there havebeen concerns and calls for amoratorium raised over “mountingevidence” that CNT may be the“new asbestos,”1 or at leastdeserving of “special toxicologicalattention” due to prior experienceswith asbestos.2 The shape and sizeof some agglomerated CNTs aresimilar to asbestos—the most“desirable.” And because CNTs forstructural utility are long andthin—characteristics thought toimpart increased potency to

asbestos fibers—discussions ofparallels between these twosubstances are natural. Thus, giventhe legacy of asbestos-relatedinjury and the thousands of caseslitigated each year, consideration ofpossible implications of the use ofCNTs in research and in consumerproducts is prudent.

First reported in 19913, CNTsepitomize the emerging field ofnanotechnology, defined by someas the “ability to measure, see,manipulate, and manufacturethings usually between 1 and100 nanometers.”4 CNTs are a typeof carbon-based engineerednanoparticle generally formed by

Uniting Plaintiff, Defense, Insurance, and Corporate Counsel toAdvance the Civil Justice System

Fall 2009

Toxic Torts and EnvironmentalLaw Committee

IN THIS ISSUECarbon Nanotubes: The Next Asbestos . . . . . . . . . . . . . . . . . . . . . . . 1

Editor’s Message . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Tatera v. FMC Corporation: When Is A Product No A Product? . . . 3

Mexico’s National Wastes Management Program. . . . . . . . . . . . . . . 4

Environmental Risk During Restructuring And Bankruptcy . . . . . 5

Upcoming TTEL Programs And Meetings . . . . . . . . . . . . . . . . . . . . 6

Limitations Of Toxicogenomic Studies To Assess Toxic ExposuresAnd Injury From Benzene . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Burlington Northern: The Requisite Intent For Arranger LiabilityUnder Cercla . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

2009-2010 TIPS Calendar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20

Continued on page 18

CommitteeNewsCommitteeNews

CARBON NANOTUBES: THE NEXT ASBESTOS?Fionna Mowat, Exponent, [email protected] Tsuji, Exponent, [email protected]

1 Miller, G. 2008. Mounting evidence that carbonnanotubes may be the new asbestos. Friends of theEarth Australia. Available at http://nano.foe.org.au.2 The Royal Society and Royal Academy ofEngineering (RS/RAE). 2004. Nanoscience andnanotechnologies. Royal Society and Royal Associationof Engineers. London: The Royal Society. Available athttp://www.royalsoc.ac.uk/.3 Iijima, S. 1991. Helical microtubules of graphiticcarbon. Nature (London) 354:56–58.4 National Science and Technology Council (NSTC).2007. The National Nanotechnology Initiative. StrategicPlan. Washington DC: NSTC, Committee onTechnology, Subcommittee on Nanoscale Science,Engineering, and Technology. December. Available athttp://www.nano.gov/ NNI_Strategic_Plan_2004.pdf.

Dear Fellow PODL members:

Welcome to the summer edition of the Professionals’ Officers’ and Directors’ Liability (“PODL”) Committee Spring Newsletter.

Our members have once again put together a wonderful newsletter. Glen Olson of Long &Levit LLP has prepared a fantastic article on the highly relevant topic of attorney client communications: “Intra Firm Communications During the Representation of a Dissatisfied Client: When Does the Attorney Client Privilege Apply”. It’s certainly a must read for every attorney. This edition also includes our case notes section highlighting recent cases impacting the professional liability insurance area. The case notes have been graciously authored by our members from various judicial circuits throughout the country.

This issue also includes a wonderful article by Edward Carleton and Laura Markovich of Skarzynski LLP, “Modern Interpretation and Application of the Insured v. Insured Exclusion”. The article serves as a great introduction to the upcoming PODL Webinar on Thursday, September 17, 2015 from 1-2:30 pm EST on “The Insured v. Insured Exclusion: The History, Evolution and Recent Developments in Interpretive Case Law”. Panelists include David Benfield of Hartford Financial Products, Carleton Burch of Anderson McPharlin & Connors LLP, Edward Carleton of Skarzynski Black LLC, Douglas Rawles of Reed Smith LLP and Tammy Yuen of Skarzynski Black LLC. Attendees will learn about the “original” intent of the IVI exclusion and how the exclusionary language has evolved in the 30 years since it first became regularly included on D&O forms. The panel will also address recent developments in IVI case law, including the authority split in the “mixed claim” scenario and the IVI’s interplay with policies’

Professionals’, Officers’ and Directors’ Liability Committee

IN THIS ISSUE:

Letter From The Chair . . . . . . . . . . . . . . . . . . . . . 1Intra-Firm Communications During The Representation Of A Dissatisfied Client: When Does The Attorney-Client Privilege Apply? . . . . 5Modern Interpretation and Application of the Insured v. Insured Exclusion . . . . . . . . . . . . . . . . 6Case Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72015-2016 TIPS Calendar. . . . . . . . . . . . . . . . . . 28

LETTER FROM THE CHAIR

Professionals’, Officers’ And Directors’ Liability Committee Newsletter Summer 2015

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allocation provisions. Your PODL membership entitles you to receive a discounted registration price of $95. We encourage you all to register for the program

It was a pleasure to see so many of you at the TIPS Section Conference. The PODL sponsored CLE, “Counsel, We Have a Problem: The Legal, Ethical and Insurance Coverage Issues Involved in Mounting a Defense When One of Your Firm’s Attorney’s is Accused of Committing Malpractice” was a great success and was one of the most well attended programs of the conference. Moderator, Scott Slater and panelists, Peter Biging, Andrew Bluestone, Colleen McNicholas, Timothy Rowan and Dan Strick presented an engaging overview of the common sources of malpractice claims, litigation strategies from both the plaintiff and defense perspectives, as well as the practical and ethical issues presented in dealing with potential conflicts between the firm, the attorney and the E&O insurer, among other issues. I would also like to thank our PODL Membership Chair, Greg Monaco for organizing our PODL dinner, which took place at the Capital Grille. We had a great turnout and a wonderful time was had by all.

We also have some fantastic events coming up at the ABA Annual Meeting in Chicago. PODL’s business meeting will take place on July 31, 2015 at 4pm at the Swissotel. The meeting is open to all members and we hope you’ll join us as we discuss plans for the upcoming year and beyond. Directly following the meeting, PODL will be co-sponsoring a CLE/CE presentation and reception with the PLUS Mid West Chapter at the Chicago Park Hyatt Hotel. The program, “Trials and Tribulations: Cyber & Privacy Risks for Lawyers” will be presented by Kari Timm of Bates Carey and Meghan Hannes of AXIS Insurance. The CLE will commence at 5:30 with a reception at the Park Hyatt to follow from 6:30-8:30. Both the CLE and Reception are complimentary, and all PODL members are invited to attend. Please RSVP to [email protected]. We will be planning an informal PODL dinner after the reception. If you are interested in attending the dinner, please contact Greg Monaco at [email protected].

I certainly hope you will find this newsletter to be as informative and valuable as I have. I thank all of our authors for their contributions, as well as our co-editors Dan Strick and Janice Hugener for producing another excellent newsletter.

As my tenure as Chair is about to end, I am gratified to have witnessed our committee’s tremendous accomplishments this past year. To this end, I’m pleased to report that in recognition of the PODL’s committee achievements, TIPS will be featuring a spotlight on PODL in this summer’s edition of The Brief. I hope to see you on July 31st in Chicago where I can personally thank you for all of your hard work and your support of PODL and you can welcome our new PODL chair John Rogers of Carlock Copeland & Stair LLP and Chair-Elect, Ari Magedoff of AXIS Insurance.

In the meantime, you can keep apprised of PODL’s upcoming events and opportunities to get involved in PODL by participating in our monthly conference calls, checking our website, connecting with PODL on LinkedIn and following PODL on Twitter: @ABATIPSPODL. Get involved and take advantage of the wonderful opportunities PODL can offer to you!

Sincerely, Barbara CostelloChair, PODL Committee

VISIT US ON THE WEB AT:

www.ambar.org/tipspodl

mailto:[email protected]

http://www.linkedin.com

mailto:@abatipspodl


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ChairBarbara Costello

Kaufman Borgeest & Ryan LLP120 Broadway, Fl 14

New York, NY 10271-1600(212) 980-9600

Fax: (212) [email protected]

Chair-ElectJohn Colquitt RogersCarlock Copeland & Stair

191 Peachtree St NE, Ste 3600Atlanta, GA 30303-1757

(404) [email protected]

Council RepresentativeGregory M Cesarano

Carlton Fields Jorden Burt PA100 SE 2nd St, Ste 4200Miami, FL 33131-2113

(305) 539-7417Fax: (305) 530-0055

[email protected]

Last Retiring ChairPerry S Granof

1147 Longmeadow LaneGlencoe, IL 60022-1022


Membership Vice-ChairGregory M Monaco

Picadio Sneath Miller & Norton PC444 Liberty Ave, Ste 1105

Pittsburgh, PA 15222-1220(412) 315-7750


Newsletter Vice-ChairJanice R Hugener

The Hugener Law Group1 Sansome St, Ste 3500

San Francisco, CA 94104-4448(415) 944-9413


Daniel S StrickLucas and Cavalier LLC

1500 Walnut St, Ste 1500Philadelphia, PA 19102-3500

(215) 751-9192Fax: (215) 751-9277

[email protected]

Scope LiaisonJuanita B Luis

175 County Road B2 E, Apt 201Saint Paul, MN 55117-1513

(651) 483-2583Fax: (952) [email protected]

Technology Vice-ChairAri R Magedoff

Axis Insurance300 Connell Dr, Ste 8000

Berkeley Heights, NJ 07922-2820(908) 508-4353

[email protected]

Vice-ChairsSerge J. Adam

Schuyler, Roche & Crisham, P.C.Two Prudential Plaza,

180 North Stetson Avenue, Ste 3700Chicago, IL 60601

[email protected](312) 565-8471

Fax: (312) 565-8300

Richard BaleLarson King LLP

30 7th St E, Ste 2800Saint Paul, MN 55101-4904

(651) 312-6500Fax: (651) 312-6618

[email protected]

Peter J BigingGoldberg Segalla LLP

600 Lexington Ave, Fl 9New York, NY 10022-7632

(646) 292-8711Fax: (646) 292-8701

[email protected]

Patrick BoleyPatrick Boley Law Firm, PLLC

879 Cheri LaneMendota Heights, MN 55120

(651) 245-5331Fax: (651) [email protected]

Kemsley Maxwell BrennanColin Biggers & Paisley

Citi Group Builidng 2 Park St, Level 42Sydney, NSW 2000

61 6128284425 [email protected]

Carleton Ray BurchAnderson McPharlin & Conners LLP

707 Wilshire Blvd, Ste 4000Los Angeles, CA 90017-3623

(213) 236-1649Fax: (213) 622-7594

[email protected]

Tracy A. CampbellCynosure Risk Advisors Llc

29 East Madison St, Ste 1108Chicago, IL 60602(312) 929-0923


Kelly B Castriotta, Esq.Arch Insurance Group

311 South Wacker Drive, Ste 3700Chicago, IL 60606(312) 601-4137

[email protected]

James F DeDonatoBeazley Group

30 Batterson Park Rd, Farmington, CT 06032-2579

(860) 674-3930Fax: (860) 679-0247

[email protected]

Stesha A Emmanuel1799 Centre St, Apt 14

West Roxbury, MA 02132-1900(617) 304-1802

[email protected]

Ommid FarashahiBatesCarey LLP

191 N Wacker Dr, Ste 2400Chicago, IL 60606-1886

(312) 762-3205Fax: (312) 762-3200

[email protected]

Alexander G HenlinLewis Brisbois Bisgaard & Smith LLP

One International Place, 3rd FlBoston, MA 02110

(857) 313-3930Fax: (888) 325-9530

[email protected]

Angela G IannacciSupreme Court of Nassau County

100 Supreme Court DrMineola, NY 11501-4802


Cecelia LocknerRopes & Gray LLP

800 Boylston St, Ste 3600Boston, MA 02199-3600



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Thomas LooksteinStarr Companies

399 Park Ave, Fl 8New York, NY 10022

1(212)4015583 [email protected]

Juanita B Luis175 County Road B2 E, Apt 201

Saint Paul, MN 55117-1513(651) 483-2583


Joseph MonteleoneRivkin Radler LLP

21 Main Street, Court Plaza South West Wing, Ste 158

Hackensack, New Jersey 07601-7021(201) 287-2497


James D MyrickWomble Carlyle5 Exchange St

Charleston, SC 29401-2530(843) 722-3400


Henry Nichollscohon & pollak LLP

10250 Constellation Blvd, Ste 2320Los Angeles, CA 90067-4618

(310) 231-4470Fax: (310) 231-4610

[email protected]

Andrew OldisKaufman Borgeest & Ryan LLP

200 Summit Lake DrValhalla, NY 10595-1355


Glen R OlsonLong & Levit LLP

465 California St, Fl 5San Francisco, CA 94104-1814

(415) 438-4483Fax: (415) 397-6392

[email protected]

Timothy J RowanMarkel Global Insurance

222 S Riverside Plz, Ste 2250Chicago, IL 60606-5808


Nilam Rani SharmaNilam Sharma Limited

22A Brechin PlaceLondon, SW74QA

447539770012Fax: 44 442074814968

[email protected]

Charles E SlyngstadBurke Williams & Sorensen LLP

444 S Flower St, Ste 2400Los Angeles, CA 90071-2953

(213) 236-0600Fax: (213) 236-2700

[email protected]

Thomas James WhalenSchott Johnson LLP

1776 K St NW, Ste 200Washington, DC 20006-2304

(202) 833-3439Fax: (202) 833-9442

[email protected]

Carol Noer ZachariasACE Group of Insurance Co

1133 Ave of The Americas, Fl 32New York, NY 10036


Frederick M ZaudererAXIS Capital

300 Connell Dr, Ste 8000Berkeley Heights, NJ 07922-2820

(908) 508-4370Fax: (908) 508-4389

[email protected]

©2015 American Bar Association, Tort Trial & Insurance Practice Section, 321 North Clark Street, Chicago, Illinois 60654; (312) 988-5607. All rights reserved.

The opinions herein are the authors’ and do not necessarily represent the views or policies of the ABA, TIPS or the Professionals’, Officers’ And Directors’ Liability Committee. Articles should not be reproduced without written permission from the Copyrights & Contracts office ([email protected]).

Editorial Policy: This Newsletter publishes information of interest to members of the Professionals’, Officers’ And Directors’ Liability Committee of the Tort Trial & Insurance Practice Section of the American Bar Association — including reports, personal opinions, prac-tice news, developing law and practice tips by the membership, as well as contributions of interest by nonmembers. Neither the ABA, the Section, the Committee, nor the Editors endorse the content or accuracy of any specific legal, personal, or other opinion, proposal or authority.

Copies may be requested by contacting the ABA at the address and telephone number listed above.

Hypertext citation linking was created with Drafting Assistant from Thomson Reuters, a product that provides all the tools needed to draft and review – right within your word processor. Thomson Reuters Legal is a Premier Section Sponsor of the ABA Tort Trial & Insurance Practice Section, and this software usage is implemented in connection with the Section’s sponsorship and marketing agreements with Thom-son Reuters. Neither the ABA nor ABA Sections endorse non-ABA products or services. Check if you have access to Drafting Assistant by contacting your Thomson Reuters representative.

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I. INTRODUCTION

When a client expresses dissatisfaction with a law firm’s

representation, or asserts a legal malpractice claim, attorneys responsible for the representation typically seek advice from other lawyers within their firm as to their professional obligations. In larger firms this process may be formalized and involve communicating with general counsel or risk management/claims counsel. Often, these consultations occur during the representation and concern how to communicate with the client regarding his or her complaints. If a legal malpractice case is then filed, the client may seek testimony from firm attorneys and the production of documents as to these intra-firm communications. Questions can arise as to whether: (1) such communications are privileged in the first instance, or (2) the firm cannot invoke the privilege because of fiduciary duties owed to the client or the existence of a conflict of interest in representing both the client and itself.

As discussed below, most courts that have addressed the attorney-client privilege in this situation acknowledge that internal communications with general counsel are subject to the attorney-client privilege and, where appropriate, the attorney work product doctrine. However, some courts have nonetheless ordered production of intra-firm communications reasoning that a law firm in this position is in a conflict of interest when it represents itself and its client and cannot withhold privileged communications from the client it continues to represent. The federal courts, in particular, have used this “fiduciary exception” to order the production of otherwise privileged documents.

A recent California Court of Appeal decision, Palmer v. Superior Court,1 adopts a different approach, based upon California’s statutory attorney-client privilege. In the following sections, this article discusses Palmer as well as other recent state decisions that have rejected the fiduciary exception. Several of these decisions hold evidentiary rules of privilege are separate and distinct from rules of professional conduct. Thus, the

duty to disclose an attorney’s error to the client does not impact the privileged nature of the firm’s own communications under appropriate circumstances. Courts that uphold the privilege also frequently cite the public policies underpinning the attorney-client privilege, including encouraging lawyers to seek advice as to their professional obligations without fear of those communications becoming discoverable.

II. THE PALMER FACTS

The Palmer decision is notable for its express disagreement with two contrary California federal district court decisions: Thelen Reid & Priest LLP v. Marland2; and In re SonicBlue, Inc.3 The Court of Appeal’s opinion strongly validates both the attorney-client privilege in the intra-firm setting and the role of general counsel in providing legal advice when client disputes arise.

Palmer arose out of the representation by Edwards Wildman Palmer LLP and its former partner, Dominique Shelton, of Shahrokh Mireskandari. Mireskandari retained Palmer and Shelton to represent him in an invasion of privacy suit against the Daily Mail, a UK-based newspaper. After suit was filed against the Daily Mail and others on April 4, 2012, the relationship between Mireskandari and the firm immediately began to deteriorate.

In June 2012, Mireskandari sent Shelton two emails complaining of the firm’s billings and the quality of its representation. He claimed Palmer and Shelton had breached the terms of their retainer agreement, particularly with regard to developing an accurate litigation budget. The Daily Mail defendants filed an anti-SLAPP motion in response to the suit, and Mireskandari ultimately retained a new firm, Greenberg Glusker, to represent him in the case.

While Palmer and Shelton still represented Mireskandari, Shelton consulted with Palmer attorneys Jeffrey Swope and James Christman concerning the billing dispute and the representation. Swope was

INTRA-FIRM COMMUNICATIONS DURING THE REPRESENTATION OF A DISSATISFIED CLIENT: WHEN DOES THE ATTORNEY-CLIENT PRIVILEGE APPLY?By: Glen R. Olson, Long & Levit LLP, San Francisco, California

1 231 Cal.App.4th 1214, 180 Cal.Rptr.3d 620 (2014)2 2007 WL 578989 (N.D. Cal. Feb. 21, 2007)3 2008 WL 170562 (Bankr. N.D. Cal. Jan. 18, 2008)


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MODERN INTERPRETATION AND APPLICATION OF THE INSURED V. INSURED EXCLUSIONBy: Edward C. Carleton and Laura K. Markovich

The so-called “Insured versus Insured” – or “I v. I” – exclusion has been included on most management liability forms for over 30 years. Despite over three decades of interpretive case law, the application of the I v. I exclusion remains highly fact specific, and thus it remains difficult to predict how a court might interpret an I v. I dispute, particularly where there is no controlling precedent within that jurisdiction. Even where there are existing case decisions, the insurance practitioner must carefully analyze the facts of each case and the specific policy language at issue when counseling clients regarding I v. I coverage issues.

I. Introduction

Any discussion of the I v. I exclusion starts with the fundamental recognition that the D&O contract is one which protects against third-party liabilities incurred as a result of the acts and omissions of D&O policy’s insureds.1 Academic literature and D&O insurance practitioners are in general agreement that the I v. I exclusion was first developed in the early 1980s as a response to claims asserted by struggling banks against their own officers to access the proceeds of their D&O policies. Two such examples are Bank of Am. N.T. & S.A. v. Powers, No. 536-776, (Cal. Super. Ct. Mar. 1, 1985) and Nat’l Union Fire Ins. Co. v. Seafirst Corp., 662 F. Supp. 36 (W.D. Wash. 1986). In each, the banks sought to recover under their D&O policies for alleged wrongful acts committed by their own directors and officers, and the courts rejected the insurers’ pleas that such conduct was excluded from coverage.

At the time, the very concept of a company suing its own directors and officers just to access the insurance policy proceeds was considered aberrational. Insurers therefore regarded such suits as collusive attempts by companies to use the D&O policy as a sort of first-party insurance or general fund to insulate themselves from,

among other things, the adverse results of questionable management decisions. Those claims were viewed as the antithesis of a true third-party claim, in which an entity or individual unaffiliated with the insureds seeks redress from those insureds for an alleged harm. As a result, an oft-cited “purpose” of the I v. I exclusion developed, that being to prevent insurer exposure to collusive suits. Although characterized as an “insurer” rationale for the exclusion, the more philosophical basis for the exclusion is to avoid inducing a corporation to sue its own directors and officers so as to tap into the insurance coverage.

Avoiding “collusive” lawsuits by a company against its own officials is not, however, the only rationale for the I v. I exclusion. Another important and frequently cited purpose is to “prevent coverage for boardroom infighting,”2 e.g., power battles between factions of corporate management or their shareholders. While these two types of claim scenarios may be factually different, the issue from the underwriting perspective is the same: neither involves a true third-party claim against insureds.

The most basic form of I v. I exclusion precludes coverage for claims brought by the insured entity, or insured persons, against other insureds. However, as the exclusion evolved, certain exceptions to the exclusion—or “carve backs”—began to emerge. If the reason for the I v. I exclusion is to avoid collusive actions, then non-collusive actions should not implicate the exclusion. For this reason, a shareholder derivative action brought by someone other than a director or officer – or without the company’s involvement – would not be excluded. (Many such shareholder suit carve backs are therefore subject to a prerequisite that covered claims must be brought “totally independent” of insured persons, ensuring that


1 See, John H. Mathias, Jr., et. al., Directors and Officers Liability: Prevention, Insurance and Indemnification § 8.02 (Rel. 27, 2014); see also, John F. Olson and Josiah O. Hatch, III, Director and Officer Liability: Indemnification & Insurance Vol. 1 §12:20 (2013-2014 Ed.).2 Id. p. 966.




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Under Wisconsin Law, Claims-Made-and-Reported Insurer Need Not Prove Prejudice for Late Notice Despite Wisconsin Statutes Imposing Notice-Prejudice Requirements (UPDATE)

By: Kelli Biggam Fleming, Esquire of Bates Carey [email protected]

Anderson v. Aul, No. 2013AP500, 862 N.W.2d 304 (Wis. Feb. 25, 2015)

In the Summer, 2014 newsletter, we reported that the Wisconsin Court of Appeals, in Anderson v. Aul, 844 N.W.2d 636 (Wis. Ct. App. 2014), held that, under Wisconsin law, the notice-prejudice rule applies to claims-made-and-reported policies. This decision was recently reversed by the Wisconsin Supreme Court.

The insurer in Anderson issued an attorney professional liability policy to Thomas Aul, an attorney, for the policy period April 1, 2009 to April 1, 2010, requiring that a claim be made and reported to the insurer during the policy period. On December 23, 2009, during the policy period, the insured received a letter from its clients that constituted a claim first made against the insured during the policy period. The insured did not report the claim to the insurer until nearly a year after the policy period expired.

The Wisconsin Court of Appeals had looked to two Wisconsin notice-prejudice statutes, Wis. Stat. §631.81 and Wis. Stat. §632.26, when analyzing if the insured provided timely notice. The court found, if notice was given to the insurer within one year of the policy’s notice requirement, in order to deny coverage based on the untimely notice, the insurer must be prejudiced by the late notice. The Wisconsin Court of Appeals concluded the insurer was not prejudiced because the untimely reporting of the claim did not hinder the insurer’s “ability to investigate, evaluate, or settle [the] claim, determine coverage, or present an effective defense ….”

The Wisconsin Supreme Court reversed, holding the notice-prejudice statutes do not apply to claims-made-and-reported policies. First, the court found the notice-prejudice statutes were not intended to supersede the specific reporting requirement in a claims-made-and-reported policy and, to allow this to happen, would be “unreasonable.” Second, the court found even if the notice-prejudice statutes applied to these types of policies, the insurer would still prevail because an

insured’s failure to report a claim made prior to the end of the policy period is “per se prejudicial” to the insurer.

Under Illinois Law, RICO and Fraud Claims Fall Within Exclusion for “Dishonest, Fraudulent, Criminal or Malicious Acts . . . .”

General Star Nat. Ins. Co. v. Adams Valuation Corp., No. 14C1821, 2014 WL 4783027 (N.D. Ill. Sept. 23, 2014)

The insured, Adams Valuation Corporation (“Adams”), provided real estate appraisal services. Adams was insured under a real estate E&O policy issued by General Star National Insurance Company (“General Star”). The policy excluded claims “[a]rising out of a dishonest, fraudulent, criminal or malicious act or omission, or intentional misrepresentation . . . committed by, at the direct of, or with the knowledge of any Insured (the “Exclusion”).

Diane Goldring Nesbitt sued Adams, along with two other defendants, alleging that they engaged in a scheme to defraud two banks. Allegedly, Adams prepared false appraisals that overvalued properties in order to skim proceeds from loans issued by the banks in reliance on the inflated appraisals. Adams was named as a defendant in four counts of the complaint, including two counts for violation of RICO, one count for common law fraud, and one count for aiding and abetting fraud.

After Adams tendered the complaint, General Star filed a declaratory judgment action against Adams and Nesbitt. General Star then filed a motion for judgment on the pleadings, arguing it had no duty to defend Adams because the facts alleged in the complaint did not fall within coverage and the Exclusion applied to preclude coverage. In response, Adams argued there was coverage because the court should look beyond the legal theories set forth in the complaint to consider the “tortious conduct on which the lawsuit was based.”

The district court granted judgment on the pleadings in favor of General Star, finding coverage was barred by the Exclusion. The court held the RICO claims “necessarily” alleged Adams committed or agreed to commit criminal acts. Further, the claims for fraud and aiding and abetting fraud “necessarily” alleged that Adams committed, or assisted in committing, dishonest or fraudulent acts or omissions, or intentional misrepresentations.

CASE NOTES






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Under Indiana law, No Coverage for Complaint Alleging Defendant Committed Acts Prior to Policy’s Retro Date

Savers Prop. & Cas. Ins. Co. v. Indus. Safety & Env’t Serv., Inc., No. 12CV528, 2014 WL 1230727 (N.D. Ind. Mar. 25, 2014)

Savers Property & Casualty Insurance Company (“Savers”) issued a policy providing consultant’s professional liability coverage to Industrial Safety and Environmental Services (“Industrial Safety”) and its CEO, Tristan Gour. The insuring agreement of the professional liability coverage section was subject to a provision limiting coverage to claims involving a “wrongful act” that “occurred on or after the Professional Liability Retroactive Date” of February 1, 2005 (the “Retro Date Provision”). The policy also excluded claims arising out of criminal, dishonest or fraudulent acts (the “Exclusion”).

Gour was named as a defendant in a lawsuit, along with several co-defendants, alleging the defendants caused ground water contamination through the unlawful dumping of hazardous waste. A claim for violation of RICO was alleged against Gour for his participation in a scheme to illegally dispose of hazardous waste, engage in mail fraud, and obstruct justice. While the scheme allegedly continued from 1997 through 2012, the acts attributed to Gour in the complaint only allegedly occurred in 1997 and 1998.

Industrial Safety tendered the complaint to Savers on behalf of Gour, and Savers denied coverage because the claims against Gour involved acts of misconduct occurring before the February 1, 2005 retro date. Savers filed a declaratory judgment action and sought summary judgment that there was no coverage for the lawsuit.

The district court granted summary judgment in favor of Savers, concluding the alleged acts committed by Gour occurred earlier than the retro date. While Gour argued the retro date did not apply to bar coverage because the complaint asserted liability against Gour’s co-defendants, with whom Gour allegedly engaged in a continuing scheme, for acts that occurred after the retro date, the court rejected this argument, finding there was no coverage under the Retro Date Provision. Further, the court concluded the Exclusion applied to bar coverage because the complaint alleged that Gour and his co-defendants engaged in intentional acts of fraud.

Under Illinois Law, Prior Knowledge Exclusion Applied Where Insured Had Requisite Knowledge Before Policy Incepted

Cardenas v. Twin City Fire Ins. Co., No. 13C8236, 2014 WL 4699670 (N.D. Ill. Sept. 19, 2014)

Twin City Fire Insurance Company (“Twin City”) issued four consecutive lawyers malpractice insurance policies to John Ambrose, an attorney, and his law firm, between August 29, 2008 and August 29, 2012. The policies required that Ambrose notify Twin City “immediately . . . of any circumstance which may give rise to a claim.” The policies also contained an exclusion stating there is no coverage for claims arising out of acts or omissions occurring prior to the inception date of the policy, on August 29 of each policy year, if the insured “knew or could have reasonably foreseen” that the acts “might be expected to be the basis of a claim” (the “Prior Knowledge Exclusion”).

Ambrose represented Maria Cardenas in a lawsuit alleging civil rights violations against the City of Chicago and one of its police officers. On February 15, 2010, the Northern District of Illinois dismissed the case because of Ambrose’s “unjustified failure” to timely serve the police officer, stating Ambrose had “only himself to blame” for the dismissal. The Seventh Circuit affirmed the dismissal on July 21, 2011 and denied rehearing on September 15, 2011. On February 15, 2012, Cardenas sued Ambrose for legal malpractice, alleging that Ambrose negligently failed to serve the police officer in the civil rights lawsuit. Ambrose notified Twin City of the malpractice lawsuit five days later, on February 20, 2012. Twin City denied any obligation to defend or indemnify Ambrose on the basis of late notice and the Prior Knowledge Exclusion. Subsequently, Cardenas and Ambrose reached a settlement, where Ambrose agreed to pay Cardenas $750,000 and assign all of Ambrose’s rights to the Twin City policy, provided that Cardenas could only seek to enforce the settlement against Twin City.

Cardenas sued Twin City, alleging Twin City breached its duty to defend under Illinois law and the parties filed cross-motions for summary judgment. Twin City asserted the relevant policy was the policy effective August 29, 2011 to August 29, 2012. According to Twin City, when analyzing coverage under this policy, the Prior Knowledge Exclusion barred coverage because Ambrose was aware of the 2010 district court dismissal and 2011 Seventh Circuit decision in the civil rights litigation prior to inception of the policy on August 29, 2011. In response, Cardenas argued there was doubt as to whether Ambrose’s failure to serve the civil rights complaint meant that Ambrose knew or could reasonably expect a malpractice claim would result for purposes of the Prior Knowledge Exclusion.







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The district court granted summary judgment in favor of Twin City, finding the Prior Knowledge Exclusion barred coverage. When considering the language of the exclusion, the court held the Prior Knowledge Exclusion barred coverage for actions that Ambrose either subjectively knew could form the basis of a claim or those that might be expected to form the basis of a claim when applying an objective standard. Thus, whether Ambrose had subjective knowledge was irrelevant if,

when applying an objective standard to consider the facts known to Ambrose when the civil rights litigation was dismissed, a reasonable attorney would expect a claim might be forthcoming. The court concluded Ambrose was aware of facts that provided a basis to believe that a malpractice claim against him was likely and, thus, the application of the Prior Knowledge Exclusion to the facts of the case was “clear and free from doubt.”

Sixth Circuit

Ninth Circuit

Insured’s Claim for Bad-Faith Claims Handling Failed as a Matter of Law; Characterization by Insured’s Counsel at Trial of Insurer as Ruthless, Faceless Corporation, Though Perhaps Inappropriate, Was Not So Prejudicial as to Constitute Reversible Error

By: W. Joel Vander Vliet, Esquire of Skarzynski Black LLC [email protected]

Hanczaryk v. Chapin, No. 313278, 2014 WL 5462600 (Mich. Ct. App. Oct. 28, 2014)

Hanczaryk, a chiropractor, was sued by a client for professional malpractice. The chiropractor’s malpractice liability insurers settled the case, and Hanczaryk subsequently sued the insurers for various claims, including bad faith. Hanczaryk’s bad faith theory was that the insurers, upon notice of the lawsuit, should have substituted different counsel (Hanczaryk also sued his attorney in connection with the case) and prepared for trial rather than pressuring him to consent to settlement. Following a jury verdict in favor of the chiropractor, the insurers appealed. Explaining Michigan does not

recognize an independent tort for bad faith claims handing, the appellate court held the insurers were entitled to a directed verdict on the bad faith claim. Because the bad faith claim was based entirely upon the insurers’ handling of the defense, it did not arise from any duty that was separate and distinct from the insurance contract, as required by Michigan law for a viable bad faith claim.

On appeal, the insurers also argued certain statements by Hanczaryk’s counsel at trial were so inflammatory that they prejudiced the jury against the insurers and deprived them of a fair trial. At trial, counsel characterized the insurers as “an out-of-state corporation protecting its own interests while defaming Hanczaryk” and a “‘ruthless company’ in which no one ‘care[d] anything about little Dr. Hanczaryk.’” According to the appeals court, the attorney’s argument “invoked stereotypes of Hanczaryk as a physician motivated to help his patients, and defendants as a greed-motivated impersonal entity.” The court held these statements were not as inflammatory as language warranting reversal in other cases, and furthermore that a jury instruction not to treat the insurers any differently based on their corporate status cured any potential prejudice.

Ninth Circuit Nixes Interlocutory Appeal of Sanctions Order

By: Charles E. Slyngstad, of Burke, Williams & Sorensen, LLP [email protected]

Lynn v. Gateway Unified School Dist., 771 F.3d 1135 (9th Cir. 2014)

In a decision by the Ninth Circuit, the court held that a District Court order finding an attorney committed

ethical violations, and disqualifying him from representing an employee in a case his former employer, was not subject to interlocutory appeal.

The attorney represented a Director of Information and Technology for a school district. The lower court determined the IT Director “stole 39,312 emails,” which his attorney used in another lawsuit against the same employer. The District Court opined a careful lawyer should have counselled the IT Director about his








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exposure to criminal sanctions when the attorney received the emails. He definitely should not have used them in litigation. The court found eight violations of professional conduct had been raised and disqualified him and his law firm. (The court also ruled the emails could not be used.)

The attorney timely appealed. He asserted appellate jurisdiction based on the collateral order exception to the final judgment requirement for appellate review. Although the Supreme Court explicitly held in Richardson-Merrell, Inc. v. Koller, 472 U.S. 424, 440-441 (1985), that orders disqualifying counsel are not collateral orders subject to appeal as final judgments within the meaning of 28 U.S.C. section 1291, the attorney argued that the sanctions in the order – the findings of unethical conduct or violations of professional conduct – made the order appealable under United States v. Talao, 222 F.3d 1133 (9th Cir. 2000). Talao permitted a criminal attorney to appeal a sanctions order in a case where the ethical violation warranted an instruction to the jurors in an ongoing criminal case that they could take the attorney’s misconduct into account when assessing a particular witness’s credibility. In rejecting the attorney’s argument, the Ninth Circuit noted that the Talao decision has been limited to its facts, involving a sanctions order that may be outcome determinative. The court held that it had no jurisdiction over an appeal from the sanctions order at issue in the current case.

California State Court Recognizes Intrafirm Attorney-Client Privilege

Edwards Wildman Palmer v. Superior Court, 231 Cal.App.4th 1214 (2014)

A California Court of Appeal in Los Angeles has made life simpler for attorneys who have unhappy clients. The court held that the attorney-client privilege protected from disclosure communications between an attorney in a 600-person firm and her general counsel and claims counsel in her own firm after the attorney sought advice from them about how to deal with the client’s complaints. If there is a real attorney-client relationship, the communications are protected. Whether an attorney-client relationship exists depends on a number of factors, including whether the law firm designated lawyers who were to represent it as in-house counsel; whether the client was billed for time spent by the lawyers while talking about the issue; whether the in-house counsel ever worked on the client’s matters; and, obviously, whether the attorneys intended the communications to be kept confidential.

Applying the factors noted, the court concluded that general counsel and claims counsel “responsible for claims handling and loss prevention” were within the law firm’s own attorney-client privilege, but a third lawyer who had been assigned to monitor the situation and who actually worked on the client’s case without billing for his time was not within the privilege. As to the latter attorney, the record did not clearly make out a showing that he had an attorney-client relationship and he had not normally worked in a general counsel or ethics role for the law firm.

District Court Narrowly Applies Insured v. Insured Exclusion

St. Paul Mercury Ins. Co. v. Hahn, No. SACV 13-0424, 2014 WL 5369400 (C.D. Cal. Oct. 8, 2014)

The District Court in the sprawling Central District of California declined to apply the insured versus insured exclusion in a directors and officers insurance policy, permitting directors and officers of a failed bank who were involved in various loans allegedly resulting in millions of dollars of losses to the bank to obtain coverage for claims against them by the Federal Deposit Insurance Corporation (FDIC) as Receiver for the bank.

The D&O insurer and the directors and officers filed cross motions for summary judgment in a coverage action by the insurer against certain directors and officers who were being sued in an underlying action by the FDIC as Receiver of Pacific Coast National Bank. Finding ambiguities in the “IvI” policy exclusion under California law, the federal judge basically concluded that the insurer could have eliminated any doubt about applicability of the exclusion to lawsuits by the FDIC as Receiver by “a simple statement” that the exclusion applied to actions by the FDIC. The court also rejected the insurer’s efforts to argue that the Shareholder Exception to the insured versus insured exclusion did not apply to the FDIC as Receiver’s claims, explaining that the claims were on behalf of shareholders even though the lawsuit differed from a derivative lawsuit on behalf of the bank. Lastly, the District Court concluded the Unpaid Loan Carve-Out did not preclude coverage because the FDIC as Receiver was seeking compensatory damages for tortious conduct by the directors and officers, and not the recovery of unpaid loans made by the bank, even though “tortious conduct results in damages that might happen to be in the amount of unrepaid loans.” Yes, the court said the carve-out did not unambiguously bar coverage.

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3108156

THE PROFESSIONAL LIABILITY UNDERWRITING SOCIETY MIDWEST CHAPTER

along with

THE AMERICAN BAR ASSOCIATION TORTS TRIAL AND INSURANCE PRACTICE SECTION PROFESSIONALS’ OFFICERS’ AND DIRECTORS’

LIABILITY COMMITTEE

are pleased to present the following program:

Trials & Tribulations:

Cyber & Privacy Risks for Lawyers* Friday, July 31, 2015

5:30 PM- 6:30 PM

Park Hyatt Chicago

800 N. Michigan Ave., Chicago, IL, 60611

Reception to follow:

6:30PM-8:30 PM

Admission to both the CLE and Reception is complimentary.

Please RSVP to: [email protected]

Panelists:

Kari A. Timm, Esq. BatesCarey LLP and Meghan Hannes, AXIS Insurance

Thank you to our reception sponsors:

Bates Carey LLP Kaufman Borgeest & Ryan LLP

*CLE and CE Approval Sought for California, Illinois and Texas


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general counsel to the firm and Christman was Palmer’s claims counsel.

Mireskandari thereafter filed a legal malpractice action and conducted Shelton’s deposition in November 2013. In the notice of deposition, Mireskandari requested the production of four categories of documents encompassing the firm’s in-house communications regarding the claim. At deposition, Shelton invoked the attorney-client privilege and refused to answer questions that purportedly related to her privileged communications with Swope. Palmer also withheld documents on the basis of the attorney-client privilege including internal law firm communications between Shelton and the Palmer lawyers that acted as counsel for the firm.

After Mireskandari moved to compel production of the documents, the firm and Shelton filed an opposition including declarations from Swope and Christman. The declarations stated Swope and Christman shared responsibility for claims handling and loss prevention issues, and that Shelton had sought, and Christman and Swope had provided, advice with respect to legal issues relating to the Mireskandari representation. Swope and Christman also declared that they had deputized another attorney, Durbin, to advise Shelton regarding her response to Mireskandari complaints. The client was not billed for any of Swope, Christman or Durbin’s time.

Characterizing the issues presented by the motion as novel, the trial court followed the reasoning of Thelen, supra, ruling a firm’s fiduciary and ethical duties to a client trump the attorney-client privilege. The court reasoned the client’s right to be informed took precedence over a claim of privilege and, if there were any discussions among the members of the firm regarding the client, his case, or his claims, those communications belonged to the client. After the court issued its ruling, Palmer and Shelton filed a petition for mandate or prohibition with the Court of Appeal requesting the trial court’s order be set aside.

III. THE PALMER HOLDING

The Court of Appeal first acknowledged extraordinary review of a discovery order is granted when the ruling threatens immediate harm such as the loss of a privilege against disclosure for which there is no other adequate remedy.4 The Court also noted the attorney-client relationship exists, for the purpose of determining the applicability of the privilege, whenever a person consults an attorney to obtain the attorney’s legal services or advice.

The Palmer court then discussed the statutory basis for the privilege, noting California recognizes eight specifically enumerated exceptions.5 When none of these exceptions apply, the privilege is “absolute” and disclosure may not be ordered, without regard to relevance, necessity or any particular circumstances peculiar to the case.6

The Court observed as law firms have grown both in size and organization, they frequently employ internal ethics and claim attorneys. The Court noted there was nothing exceptional about attorneys within a firm seeking confidential legal advice as to their own interests or as to a matter impacting the firm.7

Mireskandari argued, however, because of the ethical and fiduciary duties owed to him by Palmer and Shelton, the intra-firm communications made during and concerning the representation were not protected by the attorney-client privilege. He relied on the Thelen and SonicBlue decisions as support for this argument.

The court in Thelen ruled the information requested in that case “implicated or affected the client’s interest” as well as Thelen’s fiduciary relationship with the client. As a result, the “lid” on the communications was considered “lifted.”8 The district court ordered the production of, among other things, Thelen’s intra-firm communications discussing (1) the client’s potential claims against the firm, (2) known errors in the firm’s representation, and (3) known conflicts in the representation.9

In SonicBlue, the parties seeking the production of privileged information were the claimants in bankruptcy

4 180 Cal.Rptr.3d at 626-627 5 Id. at 629, citing Cal. Evid. Code §§956-9626 180 Cal.Rptr.3d at 629, citing Costco Wholesale Corp. v. Superior Court (2009) 47 Cal.4th 725, 732, 101 Cal.Rptr.3d 758, 219 P.3d 756.7 Palmer, 180 Cal.Rptr.3d at 629-630, noting that the Court had previously found that an attorney-client relationship could exist between attorneys within the same firm. Kerner v. Superior Court (2012) 206 Cal.App.4th 84, 117-119, 141 Cal.Rptr.3d 504.8 2000 U.S. Dist. Lexis 17482, at p. *7. 9 Id. at *8.

INTRA-FIRM...Continued from page 5


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proceedings. They sought documents from Pillsbury Winthrop Shaw Pittman, former counsel for the debtors, including communications reflecting legal advice Pillsbury had sought and received on its own behalf from its own attorneys.10 The court ordered production of the information reasoning that, when a law firm chooses to represent itself, it runs the risk of creating an impermissible conflict of interest with one or more of its current clients. The court concluded the law firm’s claim of privilege under those circumstances must give way to the protection of current clients who may be harmed by the conflict.11

While Thelen and SonicBlue ordered the production of privileged materials, the Palmer court observed courts in other states had rejected the application of this “fiduciary” or “current client” exception to the attorney-client privilege.12 In each of those cases, discussed in more detail below, a former client had sought to discover communications exchanged between in-house counsel and the lawyers responsible for the representation while the representation was underway. In one such decision, Crimson Trace Corp. v. Davis Wright Tremaine LLP 13, the Oregon Supreme Court noted, unlike the judge-made law on the attorney-client privilege in other jurisdictions, Oregon’s attorney-client privilege was established by statute and was a matter of legislative intent.14

Similarly, the Palmer court observed the California Supreme Court had rejected the notion that a fiduciary exception to the attorney-client privilege exists, in a case in which the holder of the documents was a co-trustee of a trust.15 The court in that action concluded the privileges set forth in the Evidence Code are legislative creations which California courts have no power to expand or narrow, including through the application of newly-created exceptions.16

In addressing the interplay between rules of professional conduct and the attorney-client privilege, the Court of Appeal confirmed its intent not to condone or minimize the significance of an attorney’s violation

of the rules of professional conduct. However, the Court observed nothing in the Evidence Code suggested a potential or actual conflict of interest arising under the circumstances presented by Mireskandari’s claim abrogated the attorney-client privilege.17

Moreover, the Palmer court noted, in a practical sense, it was not a foregone conclusion that an attorney’s consultation with counsel regarding a client dispute would always be adverse to a client. The legal advice might in fact find the way to best address the potential conflict without injury to the client. Nor did the existence of the attorney-client privilege undercut the firm’s duty to keep a client apprised of developments in the case or to alert a client of an incident of malpractice. The privilege protected confidential communications between the lawyer and the client but did not excuse the firm from reporting the fact it committed malpractice.18

The Court then held as a matter of law the firm had not established preliminary facts showing an attorney-client relationship existed between Durbin and Shelton. In its opposition to the motion the firm did not include a declaration from Durbin and Durbin was not mentioned in the deposition excerpts attached to the motion. It appeared Durbin’s normal role was not as Palmer’s general counsel or ethics counsel; instead he was purportedly “deputized” by Swope and Christman to perform certain tasks after the dispute arose.19

The Court also noted Durbin had actually worked on the Daily Mail case supervising the preparation of pleadings. Therefore, the firm had failed to establish that Shelton’s communications with Durbin were confidential communications made in the course of the attorney-client relationship between them.

In contrast, the court held Mireskandari’s motion should be denied as to the communications with Swope and Christman.20 Shelton had testified at deposition she considered Swope to be her attorney. Swope had also declared he had numerous communications with Shelton in his capacity as general counsel for the purpose of

10 SonicBlue, supra, 2008 WL 170562 at p. *1, 2008 Bankr. LEXIS 181 at p.*411 Id. at p. *9, 2008 Bankr. LEXIS 181 at p.*2612 See RFF Family Partnership, LP v. Burns & Levinson, LLP, 991 N.E.2d 1066 (Mass. 2013); St. Simons Waterfront, LLC v. Hunter, Maclean, Exley & Dunn, PC , 746 S.E.2d 98(Ga. 2013); Crimson Trace Corp. v. Davis Wright Tremaine LLP, 326 P.3d 1181, 1183 (Ore. 2014)13 326 P.3d 1181, 1183 (Ore. 2014)14 Id. at 1192-93, 119515 Wells Fargo, N.A. v. Superior Court, 22 Cal.4th 201, 206, 91 Cal.Rptr.2d 716, 990 P.2d 591 (2000)16 Palmer, 180 Cal.Rptr.3d at 633-3417 Id. at 635. 18 Id. 19 Id. at 63720 Id. at 638






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advising her regarding her responses to the complaint. Christman had similarly declared that Shelton had sought legal advice about the Mireskandari matter and that he gave her such advice in his official capacity as Palmer’s claims counsel. The Court noted from this evidence the trial court could have concluded as a factual matter that the firm and Shelton had met their preliminary burden to establish the existence of an attorney-client relationship.21 However, the Court of Appeal left it to the trial court to address in the first instance this question and any further issues that may remain with regard to Mireskandari’s motion to compel.22

IV. OTHER DECISIONS ADDRESSING THE PRIVILEGE ISSUE

As the Palmer decision recognized, the California courts are not alone in protecting privileged intra-firm communications regarding a pending or threatened malpractice claim. In fact, as discussed below, the issue has reached the highest appellate courts of several states and the intermediate appellate courts in Illinois appear to approach the issue in a manner consistent with Palmer.

A. Georgia

In St. Simons Waterfront, LLC v. Hunter, Maclean, Exley & Dunn, P.C.,23 the Hunter Exley law firm represented St. Simons Waterfront, LLC as to a condominium project. After several purchasers sought rescission of real estate contracts the firm had drafted, a dispute arose between Hunter Maclean and St. Simons as to the legal representation. The firm continued to represent St. Simons as to certain real estate closings and, during the period of its representation, the responsible attorneys communicated with in-house counsel concerning the representation. The trial court ordered that these in-house communications be produced and the intermediate appellate court then established a place a “framework” designed to resolve the privilege issue. The Georgia Supreme Court accepted the case on review to “restructure” that

framework consistent with the general requirements of Georgia’s privilege law.24

The Supreme Court acknowledged some courts had concluded intra-firm communications regarding a current client are not entitled to privilege under any circumstances due to the fiduciary relationship between the firm and its client.25 Other courts had held the privilege applies only in limited circumstances,26 or that the privilege does apply or that it applies with narrow exceptions.27

Having examined these various different approaches and their rationales, the Supreme Court determined the best course was “simply to analyze the privilege here as we would in any other lawsuit in which the privilege is asserted.”28 The Court began with an analysis of whether an attorney-client relationship existed noting the level of formality associated with creating the in-house position may be relevant in assessing the existence of such a relationship. The Court observed for example, “where the in-house counsel holds a full-time position as firm counsel to the exclusion of other work, it should be easier to establish the existence of attorney-client relationship between counsel and the firm with respect to a given matter.” 29

The St. Simons court concluded the potential existence of an imputed conflict of interest between in-house counsel and the firm’s client was not a persuasive basis for abrogating the attorney-client privilege between in-house counsel and the firm’s attorneys.30 The Court held the attorney-client privilege applies to communications between a law firm’s attorneys and its in-house counsel regarding a client’s potential claims against the firm where: (1) there is a genuine attorney-client relationship between the firm’s lawyers and in-house counsel; (2) the communications were intended to advance the firm’s interest in limiting exposure to liability rather than the client’s interest in obtaining sound legal representation; (3) the communications were conducted and maintained in confidence; and (4) no exception to the privilege applies.

21 Id.22 Id.23 293 Ga. 419, 746 S.E.2d 98 (2013).24 746 S.E.2d at 103.25 Id. at 104, citing Koen Book Distributors v. Powell, Trchtman, Logan, Carrle, Bowman & Lombardo, PC, 212 F.R.D. 283, 285-286 (E.D. Pa. 2002); Bank Brussels Lambert v. Credit Lyonnais (Suisse), S.A., 220 F.Supp.2d 283, 287 (S.D. N.Y. 2002), In re SonicBlue, Inc., supra.26 Id. at 104, citing Thelen Reid & Priest, LLP v. Marland, supra.27 Id. at 104, citing Tattletale Alarm System v. Calfee, Halter & Griswold, LLP, 2011 W.L. 382627 (S.D. Ohio, Feb. 3, 2011); Garvy v. Seyfarth Shaw LLP, 359 Ill.Dec. 202, 966 N.E.2d 523, 538 (2012)28 St. Simons Waterfront, 746 S.E.2d at 104.29 Id. at 105, citing Elizabeth Chambliss, The Scope of In-Firm Privilege, 80 Notre Dame, L.Rev. 1721, 1748-49 (2005) 30 Id. at 106





















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The Court remanded the case to the trial court with the law firm bearing the burden to prove the privilege applied and that the relevant elements were satisfied.31 The Court also concluded once the relationship between attorney and client becomes adversarial, work product protection would attach under the same principles as discussed with respect to the attorney-client privilege.32

B. Illinois

The application of the attorney-client privilege to in-house communications was considered in two Illinois intermediate appellate court decisions, MDA City Apartments v. DLA Piper LLP 33 and Garvy v. Seyfarth Shaw, LLP. 34 The facts and holding of the more recent of the two opinions, MDA City Apartments, are as follows.

The client, MDA, retained DLA Piper LLP (DLA) to handle arbitration proceedings in a declaratory judgment action against Walsh Construction Company arising from a contract dispute. During the handling of the arbitration and a declaratory judgment proceeding on MDA’s behalf, Walsh’s counsel indicated it would move to disqualify DLA as MDA’s counsel. Walsh contended it was affiliated through a purported common ownership with an entity known as Walsh Investors, for which DLA had done work.

DLA advised its client, MDA of the claimed conflict. After Walsh filed motions to disqualify DLA in the chancery action and arbitration proceeding the DLA attorneys consulted with DLA’s in-house counsel regarding the motions to disqualify and also hired outside counsel to represent DLA on the motions. Thereafter, both the circuit court in the chancery action and the arbitration panel granted the motions to disqualify DLA.35

In MDA’s subsequent legal malpractice suit, it sought discovery of DLA’s communications with in-house and outside counsel regarding the motions to disqualify. DLA produced a privilege log listing 57 email communications between DLA attorneys and in-house counsel from May 2006 through July 2009 as well as communications between DLA attorneys and outside counsel from September 2006 through August 2007.

After DLA produced two of the documents listed on the privilege log, MDA filed a motion to compel DLA to produce the remaining 55 communications. At a hearing on the motion to compel the circuit court ruled, so long as an attorney represents a client, the client is entitled to communications the attorney has with in-house and outside counsel relating to issues that involve the client. The court therefore entered an order granting the motion to compel the production of the documents and after DLA refused to do so, the court assessed a sanction from which DLA appealed.36

On review of the order, the Court of Appeal noted the purpose of the attorney-client privilege is to encourage clients to engage in a full and frank discussion with their attorneys without fear of compelled disclosure of information. Under Illinois law the privilege “has its limits” and must be narrowly construed.37 The Court observed MDA was seeking production of the communications pursuant to the fiduciary duty exception to the attorney-client privilege, a doctrine that arose in the context of trust law and was based on the principle that a beneficiary has the right to the production of legal advice rendered to the trustee relating to the administration of the trust. Even in the trust context, however, the exception does not apply to legal advice concerning the personal liability of the fiduciary or in anticipation of adversarial legal proceedings against the fiduciary.38

The MDA Apartments court observed it had recently addressed the fiduciary duty exception in Garvy v. Seyfarth Shaw, LLP, supra. There, the Court of Appeal stated Illinois had not adopted this exception into the attorney-client privilege, and held if adversarial proceedings were pending the communications would be privileged if the fiduciary sought legal advice in connection with a client’s malpractice claims.39

The Court of Appeal held the same reasoning applied to the communications between DLA and both in-house and outside counsel relating to its threatened litigation by MDA.40 The communications related to the motions to disqualify in the chancery action and arbitration proceedings in which DLA represented MDA. In both

31 Id. at 108. 32 Id. at 109.33 359 Ill.Dec. 694, 967 N.E.2d 424 (Ill.App.2012)34 359 Ill.Dec. 202, 966 N.E.2d 523 (Ill.App. 2012)35 MDA City Apartments, 967 N.E.2d at 428.36 Id. at 429.37 Id.38 Id., citing Mueller Industries, Inc. v. Berkman, 399 Ill.App.3d 456, 927 N.E.2d 794, (Ill.App. 2010).39 Garvy, supra, 966 N.E.2d at 536.40 MDA City Apartments, 967 N.E.2d at 430













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instances DLA was the beneficiary of the legal advice sought. Thus, even if the Court were to extend Illinois law by adopting the fiduciary duty exception, which it declined to do, the exception would not apply to the communications in question.41

The Court also observed the fact that Illinois Rules of Professional Conduct 1.4 and 1.7, requiring clients be kept reasonably informed regarding issues related to the representation and prohibiting the representation of concurrent conflicting interests, were irrelevant to whether an attorney can have an expectation of confidentiality.42 The ethics rules further recognize confidentiality obligations do not preclude the attorney from securing confidential legal advice about the lawyer’s personal responsibility to comply with such rules.43

The Court then rejected MDA’s argument that the doctrine of dual representation requires production of the communications. Even if the Court concluded DLA representing itself was analogous to the representation of an external client, MDA had not explained what common interest was involved in the communications such that DLA would not have an expectation of confidentiality.44

Finally, MDA argued the crime-fraud exception to the attorney-client privilege applied. The Court of Appeal rejected this contention as well noting that this exception does not apply to good faith consultations with an attorney about the legal implications of a proposed course of action even if it is later determined the course of action was improper.45 The Court concluded MDA had not shown application of any applicable exception to the privilege and it reversed the circuit court’s order directing DLA’s production of the 55 documents in question.46

C. Massachusetts

In RFF Family Partnership, LP v. Burns & Levinson, LLP, 47 the Supreme Judicial Court of Massachusetts addressed a law firm’s motion for a protective order to preserve the confidentiality of communications between attorneys and their law firm’s in-house counsel. The client, RFF, made a $1.4 million commercial loan to an entity known as Link Development, LLC, secured

by what RFF understood to be a first mortgage on certain property owned by Link. RFF retained Burns & Levinson, LLP to investigate title to the property, conduct due diligence, draft the necessary documents and then foreclose on the mortgage when Link defaulted on a payment.48

Shortly before the scheduled foreclosure sale an assignee of a different mortgage on the Link property filed an action to enjoin RFF’s foreclosure arguing that its lien was senior to RFF’s lien. RFF’s title insurer then retained another law firm, Prince Lobel, to represent RFF in litigation with the holder of the other mortgage. One year later, on March 2, 2011, while Burns & Levinson continued to represent RFF in active negotiations with the third party for the sale of the foreclosed property, Prince Lobel sent a notice of claim claiming B&L breached its obligations to RFF by, among other things, failing to identify and pay off another lender’s existing mortgage.

Two days after receipt of the notice of claim, three of B&L’s lawyers sought advice as to how the firm should respond from Rosenblatt, the B&L partner designated to respond to ethical questions and risk management issues.49 Rosenblatt had never worked on any RFF matters and did not bill RFF for any of the time devoted to these internal communications. B&L then communicated to the client that, in light of the notice of claim, it could not continue to represent RFF. RFF’s principal responded that Prince Lobel had not been authorized to file or threaten any litigation and that RFF wanted B&L to continue to represent it in efforts to sell the property.

Although RFF’s principal countersigned a letter indicating that Prince Lobel had not been retained to threaten litigation or file litigation against B&L, RFF nonetheless sued B&L on June 13, 2012. After RFF noticed the depositions of the parties responsible for the representation, B&L moved for a protective order to preserve the confidentiality on what it contended were privileged communications with Rosenblatt regarding B&L’s reply to the notice of claim.50

41 Id. at 431. 42 Id.43 Id. at 431, citing Garvy, supra, 966 N.E.2d at 538.44 MDA City Apartments, 967 N.E.2d at 43145 Id. at 432.46 Id. at 433.47 465 Mass. 702, 991 N.E.2d 1066 (2013)48 991 N.E.2d at 106849 Id. at 1068-69. 50 Id. at 1069.













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The trial court granted the motion for protective order and the client thereafter sought leave for an interlocutory appeal. After that request was granted, the Supreme Judicial Court transferred the appeal to itself.

RFF argued when an attorney in a law firm seeks legal advice from in-house counsel regarding how the attorney or the firm should respond to a claim or threatened claim of malpractice, the relevant communications are not protected from disclosure to the client unless: (1) the law firm before seeking the advice has withdrawn from the representation, or (2) the firm has fully disclosed to the client that the firm and the client have a conflict of interest. RFF also contended the client’s informed consent would need to be obtained for the law firm to seek legal advice. It conceded the communications were privileged communications and not subject to disclosure to any party other than the client, but claimed the fiduciary duty that a law firm owes its client to disclose all communications relevant to the representation creates a conflict of interest.51

The Supreme Judicial Court observed neither it nor any other court of last resort in the United States appeared to have addressed the applicability of the attorney-client privilege to a law firm’s in-house communications concerning a current client. In fact the Georgia Supreme Court had observed that, on this privilege issue, we “are in unchartered jurisprudential waters.”52

The RFF court proceeded to address the rationale behind the privilege in this setting. It noted when a law firm designates one or more of its attorneys to serve as its in-house counsel on ethical, regulatory and risk management issues that are crucial to the firm’s reputation and financial success, the attorney-client privilege serves the same purpose as it does for corporations or governmental entities: guaranteeing the confidentiality necessary to ensure the firm’s partners, associates and employees provide the information needed to obtain sound legal advice.53 The Court also discussed the downsides associated with RFF’s arguments.

First, RFF contended that to preserve privilege the firm could simply withdraw from the representation before seeking legal advice. The Court noted that this alternative posed a risk that the firm, without the benefit of expert advice, could unnecessarily withdraw from a representation where the apparent conflict was illusory or reparable, or withdraw without adequately protecting the client’s interest.54

Second, RFF argued that the client could be fully advised about the conflict and asked to provide consent before the firm sought legal advice. The Court observed this alternative could involve the firm advising the client about the conflict before itself obtaining the advice that would enable it to better understand the conflict.55

Third, RFF argued that the responsible attorney could simply obtain the advice from in-house counsel while recognizing the communications would not be protected from disclosure to the client. The Supreme Court criticized this alternative on the basis that the information provided to in-house counsel might be either withheld or “sugar-coated” because of the risk of disclosure to the client. In other words, the advice received could suffer from lack of candor.56

Finally, RFF suggested a fourth alternative, that counsel could simply retain an attorney in another law firm to determine how best to proceed. The Court noted this alternative could pose additional costs to the law firm, and delay the receipt of the ethical advice because the new firm would need to be retained and clear conflicts. The Court concluded all of the alternatives RFF suggested failed to serve the best interest of the clients. It characterized the suggestions as “dysfunctional, both to the client and the law firm.”57

RFF’s contention was essentially that the legal doctrine should trump functionality and that Massachusetts should join other jurisdictions in adopting the “fiduciary” and “current client” exceptions to the attorney-client privilege.58 The Supreme Judicial Court noted that the fiduciary exception would be the most dysfunctional rule of all in denying a law firm and its attorneys any

51 Id. at 1070. RFF cited Massachusetts Rule of Professional Conduct 1.7, as amended, 430 Mass. 1301 (1999). in support of this argument. 52 Hunter, Maclean, Exley & Dunn, P.C. v. St. Simons Waterfront, LLC, supra, 317 Ga.App. at 13, 730 S.E.2d 608.53 RFF Family Partnership, LP , 991 N.E.2d at 1072.54 Id. at 1074.55 Id.56 Id.57 Id.58 Id.


http://www.westlaw.com/find/default.wl?ft=L&docname=MAR307R1.7&rs=ap2.0&rp=%2ffind%2fdefault.wl&fn=_top&findtype=L&vr=2.0&db=1005833&wbtoolsId=MAR307R1.7&HistoryType=F

http://www.westlaw.com/find/default.wl?cite=430+Mass.+1301&ft=Y&db=0000521&rs=ap2.0&rp=%2ffind%2fdefault.wl&fn=_top&findtype=Y&vr=2.0&HistoryType=C









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privilege protection even if the firm seeks the advice of outside counsel unless the firm first withdraws from the representation or obtains the client’s consent.59

In fact, the RFF court noted this “draconian rule” was unnecessary to protect client interests. Preserving the privileged nature of the communications did not affect the law firm’s duty to provide a client with “full and fair disclosure of facts material to the client’s interest.”60 Nor did the privileged nature of communications with in-house or outside counsel affect a law firm’s obligation to provide the client with appropriate legal advice, even if that advice was informed by the law firm’s confidential consultation with in-house or outside counsel.61

The RFF court then addressed the “current client” exception to the privilege, most clearly articulated by the bankruptcy court in the Northern District of California in In Re SonicBlue, supra. That rule provides when conflicting duties exist, the law firm’s right to claim privilege must give way to the interest of protecting current clients who may be harmed by conflict. The Court noted the theme of the cases supporting this rule appeared to be that where a current client threatens legal action against the firm and the attorneys in the firm seek legal advice from in-house counsel the law firm is both attorney for the outside client and itself a client and these two “clients” have conflicting interest.62

The Supreme Judicial Court found two fundamental flaws in this reasoning. First the rule of imputation and Rule 1.10(a) of both the Massachusetts Rules of Professional Conduct and the ABA Model Rules of Professional Conduct generally prohibits attorneys in the same law firm from representing outside clients that are adverse to each other. The Court observed there was nothing in the language of, or commentary to, these rules to suggest that the rule of imputation was meant to prohibit in-house counsel from providing legal advice to her own law firm in response to a threatened claim by an outside client.63 The Court noted a law firm can avoid conflicting loyalties by refusing to represent an adverse outside client. But where a law firm is already representing a client and

the client threatens to bring a claim against the law firm, the potential conflict between the firm’s loyalty to the client and its loyalty to itself cannot be avoided and “must instead be addressed, either by resolving the conflict satisfactorily to the client or by withdrawing from the representation.”64

A firm is in turn not disloyal to a client by seeking legal advice to determine how best to address the potential conflict, regardless of whether the legal advice is provided by in-house counsel or outside counsel. Applying the rule of imputation under such circumstances would not avoid conflicting loyalties or prevent disloyalty; it would simply prevent or delay a law firm from seeking the expertise and advice of in-house counsel in deciding what to do where there is a potential conflict.65

Second, the Court noted that even where a law firm actually violates Massachusetts Rule of Professional Conduct 1.7(a) by representing two clients with adverse interest without the consent of each client, counsel’s failure to avoid that conflict should not deprive the client of the privilege. Under those circumstances, where an attorney represents two clients whose interests are adverse, the communications are privileged against each of the clients notwithstanding the lawyer’s misconduct.6

The Court concluded that in law, as in architecture, form should follow function and the Court preferred a formulation of the attorney-client privilege that encourages attorneys faced with the client’s threat of legal action to seek the legal advice of an in-house ethics counsel before deciding whether they must withdraw from the representation, over a formulation that would encourage attorneys to withdraw or disclose a poorly understood potential conflict before seeking such advice.67 The Court affirmed the trial judge’s partial allowance of the B&L defendants’ motion for protective order to enable the attorneys to protect the confidentiality of privileged attorney-client communications between the law firm and its in-house counsel.68

59 Id. at 1075-76. 60 Id. at 107661 Id. at 1076, citing ABA Formal OP. 08-453, at 2 (lawyer required to explain matters sufficiently to permit client to make informed decision about representation)62 Id. at 1076-77.63 Id. at 1078.64 Id. at 1078. 65 Id. at 1078-107966 Id. at 107967 Id. at 1080. 68 Id. at 1081













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D. Oregon

In Crimson Trace Corporation v. Davis Wright Tremaine LLP,69 the Oregon Supreme Court similarly rejected a fiduciary exception to the attorney-client privilege. The client, Crimson Trace, was a manufacturer and seller of laser grips for firearms. It retained Birdwell, a Davis Wright Tremaine (DWT) attorney to prosecute certain patents for its products before the Patent and Trademark Office (PTO). The client later retained DWT to represent it in a dispute with a competitor, LaserMax, Inc., over possible patent infringement. A separate DWT attorney, Boundy, acted as lead trial counsel in that litigation.70

LaserMax aggressively litigated the case and asserted a counterclaim challenging the validity of Crimson Trace’s patents. It claimed Crimson Trace had deceptively omitted material information when it submitted the patent to the PTO. Birdwell and Boundy became concerned that the patent counterclaim could create a conflict of interest between Crimson Trace and DWT in part because LaserMax had named Birdwell as the attorney who had prosecuted the patent.71 The two attorneys therefore consulted with DWT’s quality assurance committee, a small group of DWT lawyers designated by the firm as in-house counsel. After consultation with one of the QAC members, Johnson, Boundy disclosed the potential conflict in an email to Crimson’s CEO.

Although Crimson offered to dismiss its claims related to the patent, LaserMax refused to drop its counterclaim. LaserMax sought to recover attorney’s fees for defending the claim, arguing Crimson had both procured the patent and litigated the claim of infringement over it in bad faith. The district court granted LaserMax’s discovery for the purpose of determining whether Crimson Trace had in fact acted in bad faith and Birdwell’s files related to the patent were subpoenaed. Again, Birdwell and Boundy consulted with the firm’s QAC to determine how to respond.72

Crimson and LaserMax thereafter entered into a settlement of the case. However, when Boundy moved to file the settlement under seal he did so in a way that publically disclosed certain details of the agreement

giving the impression that LaserMax had conceded liability. The Court determined the disclosures were intentional and damaging to LaserMax, therefore ordering disclosure of the entire agreement and imposing monetary sanction on Crimson Trace for having acted in bad faith.

Crimson Trace thereafter stopped paying DWT. Birdwell and Boundy consulted extensively with Johnson and another QAC member on how to proceed and also communicated with the QAC about sanctions that were being sought as to disclosure of the settlement terms. Crimson Trace thereafter filed a legal malpractice action claiming that DWT breached its duty in failing to advise Crimson Trace about problems with the patent and that Birdwell would likely be a witness in the dispute, failing to advise against suing LaserMax for infringing that patent and failing to advise Crimson Trace when conflicts arose in connection with LaserMax’s request for attorney’s fees.

During the litigation, Crimson requested production of communications between or among DWT’s attorneys about possible conflicts of interest in DWT’s representation of Crimson Trace that occurred during the representation. DWT resisted production arguing the communications Crimson Trace sought were protected by the attorney-client privilege because they involved the rendition of legal services by in-house counsel to the firm and its members. Crimson Trace moved to compel and the trial court granted the motion in part, first requiring that DWT supply a privilege log with the documents to be produced to the court for in camera review. The trial court then concluded three of the documents were not privileged although the remaining documents were subject to privilege. The court nevertheless concluded the attorney-client privilege did not apply because there was a conflict of interest precluding the firm from asserting the privilege.73

In its review of the lower court’s order, the Supreme Court first observed that a privilege claim generally may be asserted if three requirements are satisfied: (1) the communication was made between a client and the client’s lawyer as defined by the Oregon statutes, (2) the communication was confidential, and

69 355 Or..476, 326 P 3rd 1181(2014)70 326 P 3rd at 118371 Id at 1183-84. 72 Id at 118473 Id. at 1185







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(3) the communication was made for the purposes of facilitating the rendition of professional legal services to the client.74

Crimson Trace, however, argued that a fourth requirement must be satisfied for the attorney-client privilege to apply. It contended the privilege depends upon the parties “reasonable expectations” and that Birdwell and Bounty could not reasonably have believed their conversations with their firm’s QAC created an attorney-client relationship because no lawyer could expect another member of his or her firm to represent the lawyer in his or her conflict with a current client. Crimson Trace claimed the Oregon Rules of Professional Conduct support that result by prohibiting lawyer from representing a client when that representation might be adverse to another client.75

The Supreme Court rejected this reasoning as unpersuasive. First, the Court observed it found no support in the wording of the applicable statute, Oregon Evidence Code 503. Nothing in that rule mentioned that an attorney-client relationship sufficient to trigger the privilege depended upon the reasonableness of the parties’ expectations. Instead, the only reference to reasonableness was with respect to a client’s belief that an individual is authorized to practice law and the reasonableness of the client’s belief that the individual is authorized to be that client’s lawyer.76

Second, the Court commented Crimson Trace had misconstrued the attorney discipline cases upon which it relied. Those decisions support the concept that the attorney-client relationship may be found to exist on the would-be client’s reasonable expectations of representation. However, the Court observed those decisions did not stand for the entirely different proposition that Crimson Trace was advancing -- that an attorney-client relationship can exist only if the putative client reasonably believes that he or she can look to the lawyer for advice or representation.77

In fact, the Court observed no one contested that Birdwell and Boundy could have consulted with lawyers outside their firm for ethics advice, and that such

consultations would be subject to the attorney-client privilege. There was nothing in the wording of OEC 503 and its supporting case law to suggest a law firm or one or more of its individual lawyers could not be the client of the firm’s in-house counsel. To the contrary, the Supreme Court had recognized that an organization can be the client of its own in-house counsel within the meaning of the statute.78

The Oregon Supreme Court also addressed the Oregon Trial Lawyers Association amicus argument that DWT and its individual lawyers should not be deemed the QAC’s clients because doing so would essentially condone violation of the law firm’s duty of loyalty to its current client and undermine the client’s sense of security and need to frankly communicate with his or her own lawyers. The Supreme Court was not persuaded by this argument, noting that its task was one of statutory interpretation rather than policy determination.79

Crimson Trace next argued the communications were not in fact confidential because they occurred in the State of Washington where Birdwell and Boundy both practiced and the Washington courts had concluded internal communications between a law firm and its in-house lawyers about a conflict with a client may not be protected by the attorney-client privilege in a malpractice action.80 The Court concluded Washington law had no bearing on the meaning of Oregon’s attorney-client privilege statute. Whether or not the communications took place in Washington, the litigation concerning those statements took place in Oregon.81

The Supreme Court then addressed Crimson Trace’s argument that the fiduciary exception to the privilege applied. The Court noted that several courts had declined to adopt the fiduciary exception to the attorney-client privilege including St. Simon’s Waterfront, LLC, RFF Family Partnership, LP and Garvey v. Seyfarth Shaw, LLP. The Court noted that California had refused to adopt the attorney-client privilege fiduciary exception because the attorney-client privilege is a legislatively-adopted evidence provision and the courts lack authority to create ad hoc exceptions to it.82

74 Id. at 118775 Id.76 Id. at 118877 Id.at 118978 Id. at 1189, citing State ex rel. OHSU, 325 Or.500, 942 P 2d 261 79 Id. at 1189.80 Id. at 1190, citing Versus Law, Inc. v. Stoel Rives, LLP, 111 P 3d 866 (Wash. App. 2005)81 Id. at 119082 Id. at 1192, citing Wells Fargo Bank v. Superior Court, supra, 22 Cal. 4th 201, 206, 990 P 2d 591, 594.














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In fact, Oregon had set forth in OEC 503(4) a complete enumeration of the exceptions to the attorney-client privilege.83 Because that list did not include a fiduciary exception, no such exception existed in Oregon. The trial court therefore erred in relying on it to compel production of communications that otherwise fell within the general scope of the attorney-client privilege.84

V. CONCLUSION

The opinions rejecting the current client and fiduciary exception arguments to the attorney-client privilege appear to be correctly reasoned, notwithstanding the federal district court rulings to the contrary. While the approach taken by the Thelen and In re SonicBlue courts has surface appeal and seems to dovetail with applicable rules of professional conduct, evidentiary privileges are indeed separate from such ethics rules and are typically grounded in legislatively-adopted statutes. There seems to be little justification for deviating from the body of law that interprets the scope of, and exceptions to, the attorney-client privilege, based upon an attorney’s professional responsibilities to his or her client.

Moreover, there could be real disadvantages to disallowing the attorney-client privilege in the “current

client” situation, including chilling the responsible attorneys’ ability and willingness to seek and obtain advice from other attorneys as to their ethical and professional responsibilities. In RFF Family Partnership, supra, the Supreme Judicial Court of Massachusetts thoroughly analyzed the various arguments that could be made in favor of the fiduciary or attorney-client exceptions and rejected each of them, analyzing carefully how they undermined the policies that underpin the attorney-client privilege. The Palmer decision is the latest statement from the appellate courts that have rejected exceptions to the attorney-client privilege with respect to intra-firm communications.

Finally, while most of the cases discussed above protect these intra-firm communications, lawyers still need to exercise care in how they communicate after a client expresses dissatisfaction or threatens a malpractice claim. Two themes that arise from the cases that protect the privilege are that: (1) there should be some formality associated with the role of ethics/general/claims counsel; and (2) counsel occupying an ethics advisory role should not be directly involved in the handling of the client’s matter.

83 Id . at 1195. 84 Id. at 1195.




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coverage is afforded only to pure third-party claims.) Similarly, the I v. I exclusion in many instances should not apply to whistleblower claims, claims brought by trustees and receivers, and claims brought by former directors who have been disassociated from the insured entity for some prescribed period of time, as in some contexts, the risk of collusive suits diminishes in direct proportion to the amount of time the executive has been disassociated from the insured entity.

Many of these exceptions are irrational, however, if the reason for the I v. I exclusion is to avoid inter-corporate disputes or disincentivize the use of lawsuits as a mechanism to chase insurance proceeds only. For example, while the “collusiveness” of an ex-director’s lawsuit against her past company may not exist given the extreme adversity between the two parties, a “carve back” which allows such a lawsuit clearly brings the insurer back into the corporate fray. In other contexts, many insurers believe that the successors in interest to corporations (i.e., bankruptcy trustees or the federal bank regulators) bring lawsuits against the company’s officials due to the very existence of the D&O policies themselves. If the insurance did not exist, the lawsuits would not be brought. Returning full circle to the disconcerting realization that the insurance policies themselves are the motivations for lawsuits against the insureds, the rationalization for broad I v. I exclusions is enhanced.

Exceptions to the I v. I exclusion have been heavily litigated, as practitioners and courts seek to apply the actual wording of the policy and, if unclear, then try to divine the true intent of the policy language. Below, we examine recent developments in several of the more frequently disputed I v. I issues.

II. Bank Crises – Old & New – and the Role of the Regulator

Litigation over I v. I exclusions began in earnest following the first wave of bank failures during the savings & loan (“S&L”) crisis of the 1980s. Between 1980 and 1989, more than 560 S&Ls with combined assets of more than $200 billion failed, due in large part to historically high interest rates and comparatively weak oversight, coupled with a deregulation of the supervisory agencies. In response to the S&L crisis, the Federal Savings and Loan Insurance Company (“FSLIC”), which was ultimately subsumed within the

Federal Deposit Insurance Corporation (“FDIC”), was appointed as receiver to many of the failed banks. The FSLIC was tasked to assess whether an action should be brought against the institution’s own directors and officers for the bank’s failure. One of the principal factors in that assessment was the ability to satisfy any financial judgment or award and, when in many of the cases the individual officials had no tangible assets, the government targeted the D&O insurance policy limits. When D&Os sought coverage for the claims later asserted against them, many insurers cited the newly minted I v. I exclusions, taking the position that – as the FSLIC was “standing in the shoes” of the bank – the exclusion precluded coverage for claims it asserted against other policy insureds.

Several courts did find in favor of insurers and applied the I v. I exclusion when the plaintiff was exercising rights of the company in the receiver context. However, at least concerning those cases filed in the late 1980s and early 1990s, it became the minority view. A majority view emerged that the FSLIC, the FDIC, and other similar agencies operated in many capacities, or “wear many hats,” when dealing with failed bank institutions. See, e.g., Am. Cas. Co. of Reading, Pa v. Sentry Fed Sav. Bank, 867 F. Supp 50 (D. Mass. 1994); FDIC v. Zaborac, 773 F. Supp. 137 (C.D. Ill. 1991); Am. Cas. Co. or Reading, Pa. v. Baker, 758 F. Supp. 1340 (C.D. Cal. 1991); Finci v. Am. Cas. Co., 572 A.2d 1092 (Md. Ct. Spec. App. 1990), rev’d on other grounds 323 Md. 358, 593 A.2d 1069 (Md. 1991); Am. Cas. Co. v. FSLIC, 704 F. Supp. 898 (E.D. Ark. 1989); Branning v. CNA Ins. Co., 721 F. Supp 1180 (W.D. Wash. 1989).

When interpreting the potential application of an I v. I exclusion in this context, courts focused on the unique scope of the exclusion in question and the extent to which the FDIC had “stepped into in the shoes” of the failed bank on a case-by-case basis. The FDIC is, of course, the successor to a failed bank institution when wearing the “hat” of receiver. But, according to applicable banking regulations, the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (“FIRREA”) among them, the FDIC may also act – much in the same way a bankruptcy trustee might – so as to protect the rights of shareholders, creditors and depositors as well. Finally, of course, the FDIC can also act in its capacity as a regulator, as it remains the agency of the US government charged with the oversight [investigation and liquidation] of banks for the protection of the general citizenry. Thus, in many instances, where the

MODERN INTERPRETATION...Continued from page 6

















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FDIC claimed it was acting in more than one capacity, and the policy exclusion in question was not sufficiently broad enough to encompass all, the courts declined to apply the exclusion.

Courts, however, did not hesitate to invoke the exclusion where the FDIC’s role clearly fell within the exclusion. In Gary v. American Cas. Co. of Reading, Pa., 753 F. Supp. 1547 (W.D. Okla. 1990), the district court concluded that where the FDIC affirmatively claimed in an amended complaint that the claims it was pursuing against the officers and directors were assets of the bank, it functionally confessed that it was suing only in its capacity as successor to the bank’s rights. The I v. I exclusion applied. Other cases have also concluded that when the FDIC is proceeding as a receiver, it is proceeding on behalf of the bank and the I v. I exclusion applies. See Powell v. American Cas. Co., 772 F.Supp. 1188 (W.D. Okla. 1991) (“Because the insured versus insured specifically excludes any claims made by the “institution” * * *, it follows that the FDIC’s action is excluded under the circumstances.”). While the decisions were all highly dependent on the facts of each case, the role of the agency in each, and the attendant policy language, the courts tended to recognize when the FDIC is acting as an Insured, the I v. I exclusion is applicable. But, when the FDIC legitimately claims to be acting in other capacities that do not fall within the exclusion, the exclusion would not apply. Of course, the FDIC can claim to be acting in different capacities and, once this dichotomy is revealed, in many cases the FDIC actually shifted its status so as to perfect the insurance entitlement.

As the S&L crisis wore on, insurers read these tea leaves and negotiated different policy language so as to clarify the intended application of the exclusion. For example, in several cases where the policy was enhanced to exclude claims asserted “in the right of” the bank, courts found that I v. I exclusions applied to claims asserted by the FDIC in its capacity as a receiver.3 See e.g. Evanston Ins. Co. v. FDIC, CV-88-0407 (C.D. Cal. May 17, 1988). In considering this language, the Evanston court held that common sense dictated that the phrase “in the right of” the bank included entities who assert the bank’s claims as a successor or representative. Because the FDIC was a successor and representative of the bank, the I v. I exclusion barred coverage for the FDIC claims. Id. at *1-2.4 See also Powell v. American Cas.

Co., 772 F. Supp. 1188 (W.D. Okla. 1991)(“because the insured versus insured [exclusion] specifically excludes any claims made by the ‘institution’ (i.e. [the] Bank), it follows that the FDIC’s action is excluded[.]”); Gary v. American Cas. Co., 753 F. Supp. 1547 (W.D. Okla. 1990) (the I v. I exclusion applies “regardless of whom the FDIC may represent and to whom the benefits of any claims asserted by it may inure” because the FDIC is asserting claims previously owned by the Bank, while the FDIC in its corporate capacity may assert claims only because it purchased those rights from the FDIC as liquidating agent).

With the second wave of bank failures that occurred as the result of the 2008 financial crisis, the FDIC once again took on the role of receiver and litigation over the application of the I v. I exclusion to the FDIC’s claims ensued. In the two decades that had passed, some insurers had scaled back the I v. I exclusions while others had simply dropped the enhancements made in the wake of the 1980-1990 coverage debates. As a result, once again the breadth of the exclusion and the “capacity” of the FDIC took to the fore, on a case-by-case basis. In the first two cases that considered an I v. I exclusion in the second bank failure wave, both the District of Puerto Rico and the Northern District of Georgia found that the policy language under their review did not preclude coverage for the FDIC’s claims. Compare W Holding Co., Inc., et al, v. Chartis Ins. Co.-Puerto Rico, et al., No. 11-2271, 2012 WL 5379039 (D.P.R. October 31, 2012) (although the exclusion ostensibly prevented the FDIC from bringing suit on behalf of the bank’s shareholders, the court found the FDIC’s action was not collusive and the FDIC sued in other capacities, such as on behalf of “depositors, account holders, and a depleted insurance fund” and in its role as a regulator) with Progressive Ins. Co. v. FDIC, 926 F.Supp. 2d 1337 (N.D. Ga. 2003) (although the exclusion applied to claims brought “by, on behalf of, or at the behest of the Company,” the FDIC could have been bringing claims not only “by” or “on behalf of” the bank, but also on behalf of the bank’s depositors, creditors, and shareholders).

In the handful of other cases considering an I v. I exclusion in the failed bank context since 2008, the Insureds or the FDIC asserted that the particular I v. I exclusion at issue was ambiguous and, at least at the early dismissal stage, not ripe for decision absent further discovery. In one notable case, the Northern

3 The “regulatory exclusion,” an adjunct to the I v. I exclusion, also emerged during this time period.4 While Evanston addressed the role of the FDIC in its corporate capacity, its reasoning applies equally to cases in which the FDIC is acting as receiver, because it held that “in the right of” includes “assignees, who purchase and then assert the claims of the bank, as well as entities who assert the claims of the bank in a representative capacity.” Id. at *1-2.
















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District of Georgia firmly disagreed that the I v. I in question was ambiguous. However, that decision was later reversed by the 11th Circuit and remanded for further proceedings. St. Paul Mercury Ins. Co. v. Miller, 968 F. Supp. 2d 1236 (N.D. Ga. 2013) (“The result of the cases determining whether to apply an insured v. insured exclusion to the FDIC usually turns more on the language of the exclusion rather than the adoption by courts of a supposed majority or minority rule.”), rev’d, St. Paul Mercury Ins. Co. v. FDIC, 774 F.3d 702 (11th Cir. 2014) (“An important indication of ambiguity in a policy is whether nearly identical or similar language has been construed differently by other courts.”). In other words, simply because other courts had come to different conclusions when applying different policy language and fact patterns, the exclusion was considered ambiguous per se under Georgia law. See also, St. Paul Mercury Ins. Co. v. Hahn, No. 13-0424, 2014 WL 5369400 (C.D. Cal. October 08, 2014) (finding the policy’s I v. I provision to be ambiguous as applied against the FDIC); Progressive Cas. Ins. Co. v. FDIC, No. 11-14816, 2012 WL 8437693 (E.D. Mich. September 24, 2012)(same). But see Progressive Cas. Ins. Co. v. F.D.I.C., --- F.Supp.3d ----, 2015 WL 310225 (N.D. Iowa 2015) (distinguishing its findings from those made under Georgia law in St. Paul Mercury, the court held that “[i]n contrast, under Iowa law, ‘ambiguity’ is a matter of ‘interpretation,’ not ‘construction,’ [citation omitted], and I found the meaning of the ‘insured vs. insured exclusion’ unambiguous using Iowa rules of interpretation,” yet also finding that it did not apply in that instance.)

In contrast, where the policy language in question tends towards the more specific, courts have been more inclined to invoke the provision. See e.g. Hawker v. BancInsure, Inc., No. 12-1261, 2014 WL 1366201 (E.D. Cal. April 07, 2014) (summary judgment granted where the exclusion specifically referenced a “receiver”).

Clearly, however, very few decisions have been rendered in this second wave of bank failures. Those that have issued are sprinkled across varying jurisdictions, and are highly dependent on the precise insurance language at issue, reinforcing a theme of this article: that the insurance practitioner should be reluctant to place undue weight on precedential authority when advising clients as to the applicability of the I v. I exclusion. Given that the spike in the rate of bank failures since 2008 seems to have leveled off and is now returning to more normal levels, it may be that the FDIC, the Insureds and the insurers have rapidly diminishing opportunity

to fully vet their arguments about the purpose and driving principles behind the application of modern I v. I exclusions to failed financial institution

III. Other Types of I v. I Activity Implicated

Principles akin to those outlined in the FDIC cases above have been applied to other kinds of corporate representations, such as bankruptcy trustees, creditors committees and debtors-in-possession when pursuing claims against a debtor’s D&Os. See e.g., Biltmore Assocs. v. Twin City Fire Ins. Co., 572 F.3d 663 (9th Cir. 2009); Biltmore Associates, LLC, as Trustee Of The Visitalk Creditors Trust v. Twin City Fire Insurance Company, et al., 572 F.3d 663 (9th Cir. 2009). Some courts have applied I v. I exclusions in these contexts, finding regardless of who may ultimately receive such funds, the cause of action being asserted derives solely from the insured corporation itself. Reliance Ins. Co. of Illinois v. Weis, 148 B.R. 575 (E.D.Mo. 1992), aff’d, 5 F.3d 532 (8th Cir. 1993) (“It is clear that the pending state court action was filed on behalf of [the Insured] and its estate, although the benefits sought may eventually inure to the creditors.”), cert. denied, 510 U.S. 1117 (1994). Others have made distinctions between such entities and the pre-bankruptcy debtor. See e.g., Federal Ins. Co. v. Continental Cas. Co., 2006 WL 3386625 (W.D.Pa. 2006) (relying on finding that the debtor’s estate representative is separate from the debtor itself).

Other questions arise when former directors and officers pursue the company after their departure. Most I v. I exclusions specifically contemplate the instance in which a former official brings an action against the company, seeking to tap into available D&O coverage. As a result, creative plaintiffs attempt to characterize themselves into a carve back to the exclusion, such as for derivative actions or wrongful employment actions. Courts have rejected such actions. American Sec. Bank & Trust Co. v. Progressive Cas. Ins. Co., No. 11-00096, 2011 WL 2531311 (M.D.Tenn. June 24, 2011) (dismissal granted on a lawsuit by a company’s director, officer and shareholder, despite a carve back for derivative actions, because the exclusion required the Claim be brought independently of, and totally without the solicitation, assistance, participation, or intervention of any Insured); Franklin Holding Corp. (Delaware) v. National Union Fire Ins. Co. of Pittsburgh, Pa., 261 A.D.2d 146, 689 N.Y.S.2d 492 (1st Dep’t 1999) (the I v. I exclusion “clearly and unambiguously excludes coverage of the derivative and class action claims that were brought against plaintiff by its former director.”); Strange v.






































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Genesis Ins. Co., 536 F.Supp.2d 71 (D.Mass. 2008) (I v. I exclusion applied to class action in which plaintiff was assisted by a former director of the insured).

IV. The Allocation Debate

A. Miller and Sphinx

Another frequently disputed I v. I issue concerns circumstances where an insured joins other non-insureds to bring a claim against the insureds. This issue has been frequently litigated where: (1) there is no express shareholder carve back; (2) there is a shareholder carve back that carries with it a prerequisite that covered claims be brought “totally independent” or without the “active assistance” of an insured person, so as to afford coverage only to pure third-party shareholder disputes; and (3) the policy’s general terms and conditions include a provision controlling allocation where there are both covered and non-covered claims.

Several viewpoints have emerged. Some courts have held where a policy has a stand-alone allocation provision, the claim is covered, and the parties should allocate between what is covered and what is not. Other courts have held even where there is an allocation clause, the entire claim is precluded from coverage. Still others have found that the language in many I v. I shareholder carve backs requiring that to be covered, the shareholder action must be brought “totally independent” and “without the active assistance of” an insured person, completely bars a “mixed” claim from coverage. These perspectives are addressed in turn.

Arguably, the leading case decisions with respect to the “allocation school” are the Seventh Circuit’s decisions in Level 3 Comm., Inc. v. Federal Ins. Co., et al., 168 F.3d 956 (7th Cir. 1999) and Miller v. St. Paul Mercury Ins. Co., 683 F.3d 871 (7th Cir. 2012). In Level 3, the litigation was not initially brought by any insureds; rather insureds were later added to a shareholder class action. Coverage litigation followed involving a number of issues including the application of an I v. I exclusion. The I v. I exclusion did not have a shareholder carve out, but did contain an allocation provision. When considering this policy language, Judge Posner held that allocation was appropriate between the covered claims brought by non-insureds, and the uncovered claims brought by insureds. The court reasoned that to hold otherwise would lead to the very unusual situation of an initially covered claim being rendered uncovered simply because of the later addition of a prohibited plaintiff. For over a decade, carrier side practitioners argued

that these specific facts limited Level 3’s application to instances where an insured plaintiff was later added to a claim that did not previously implicate the I v. I exclusion; however, Level 3’s rationale was rearticulated and arguably broadened in 2012 by Miller.

In Miller, three former directors, along with non-insureds, sued the insured entity and two of its directors and officers. Thus, at the outset, Miller was different than Level 3 because the claim was “mixed” at the time it was initially filed. As with Level 3, the Miller I v. I exclusion was silent as to whether shareholder suits were covered. Nevertheless, the trial court held the I v. I exclusion barred coverage for the entire action. On appeal, the Seventh Circuit reversed the trial court in an opinion that included an expansive analysis of Level 3 and other I v. I case law on the mixed claim issue. In holding that coverage (both defense and indemnity) was afforded for the claims by the non-insured plaintiffs (subject to the policy’s allocation provision), and expanding the reach of Level 3, the court remarked that:

[w]e decline St. Paul’s invitation to impose arbitrary limits on the reasoning of Level 3 Communications, whether based on the timing of the insured’s entry into the lawsuit, the proportion of damages sought by insureds, or the active versus passive involvement of the insureds. The allocation clause in the St. Paul policy leads to the proper result: claims brought by or on behalf of insureds are excluded, while those brought by non-insureds are not.

Id. at 879 (emphasis added). Thus, the Miller court found that, under the policy language in question, where there are claims brought by both insureds and non-insureds, coverage should be afforded to the non-insureds’ claims subject to the policy’s allocation provision. It should be noted, however, that the Miller court also expressly and unequivocally left the door open for a broader application of the I v. I exclusion, such as that as espoused by the Eleventh Circuit in an opinion predating Miller (Sphinx, discussed below). That is, the Miller court conceded it may have reached a different conclusion if the shareholder exception to the I v. I exclusion at issue in Miller had the “totally independent” prerequisite found in many I v. I shareholder exception provisions.

In Sphinx Int’l, Inc. v. National Union Fire Ins. Co. of Pitt., 412 F.3d 1224 (11th Cir. 2005), a corporate officer and shareholder brought a lawsuit against his










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former company. Shortly after filing his complaint, the executive published a notice in a national newswire service soliciting other shareholders. As a result, eight additional shareholders were added to the complaint, and the insured’s D&O carrier ultimately denied coverage for the suit, relying on the I v. I exclusion. In distinguishing Level 3 and holding coverage was precluded, the Eleventh Circuit relied on the Sphinx D&O Policy’s I v. I exclusion’s language:

Here, in contrast, the D&O policy is much broader, barring coverage for claims “By or at the behest of . . . any DIRECTOR or OFFICER . . . unless such CLAIM is instigated and continued totally independent of, and totally without the solicitation of, or assistance of, or active participation of, or intervention of, any DIRECTOR or OFFICER or the COMPANY or any affiliate of the COMPANY.” While the language in Level 3 Communications gave the court some wiggle room, the language in our case is plain and clear, compelling our conclusion that Genesis need not cover Sphinx for Taylor’s lawsuit.

Id. at 1231. Importantly, in Miller, the Seventh Circuit did not disagree with the Eleventh Circuit’s quoted conclusion, holding that: “we have no disagreement with that [i.e., Sphinx] reasoning, but we find no similar language [i.e., a shareholder carve out] in the St. Paul policy that would defeat coverage for a claim by a non-insured plaintiff depending on whether she acted independently of insured plaintiffs.” Miller, 683 F.3d at 879. The Miller court further observed a “proper appreciation of the different policy language in the two cases is more than sufficient to support the Eleventh Circuit’s ruling without reading into the decision any arbitrary limit on Level 3 Communications.” Id.

Interestingly, the Miller court appeared to distinguish Sphinx exclusively on the grounds of the Sphinx policy’s I v. I language, which included the “totally independent” language in the carve out for claims brought by non-insureds; that is, in discussing Sphinx, there was no discussion of the allocation issue. Similarly, in Sphinx, the Eleventh Circuit focused on the “totally independent” language that was not present in Level 3. In contrast, the result in Miller was justified both on the grounds that the Miller I v. I exclusion lacked the “totally independent”

language and the fact that the Miller policy had an allocation provision. The authors are not aware of any authority discussing the application of the I v. I exclusion to “mixed” claims where the policy at issue had both: (1) “totally independent” language in the I v. I carve out; and (2) an allocation provision.

B. Powersports, Inc. v. Royal & SunAlliance Ins. Co.

A further case that deserves mention on the I v. I/allocation issue is Powersports, Inc. v. Royal & SunAlliance Ins. Co., 307 F. Supp. 2d 1355 (S.D. Fla. 2004). Powersports was a mixed claim, where the plaintiffs included two former directors of Powersports who, thus, qualified as insureds. The third plaintiff was a company owned and controlled by the two individual insureds. The carrier disclaimed coverage, relying on the narrowly tailored I v. I exclusion, which did not contain “totally independent” language. Nevertheless, the court held that the I v. I exclusion barred coverage for the entire claim, notwithstanding the fact that the policy at issue had an allocation provision. In so holding, the court observed the result made sense, and was distinguishable from Level 3, because the claim was not covered from the outset due to the presence of insured plaintiffs at the time of filing. Id. at *1361 (“[A]lthough allocation clauses recognize that covered and non-covered claims may coexist in the same action, the allocation clause is not what makes them so.”)

C. AMERCO v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa.

The application of the I v. I exclusion continues to be litigated. As of the date of this writing, the allocation issue is on appeal before the Ninth Circuit in AMERCO v. Nat’l Union Fire Ins. Co. of Pittsburgh, Pa., No. 13-2588, 2014 WL 2094198. Appellate briefing was completed in December 2014. In the underlying case, the District of Arizona considered the Miller-Sphinx split of authority. Id., at *1 (D. Ariz. May 20, 2014) (interpreting Arizona law). The trial court held the “totally independent” prerequisite (i.e., that a shareholder claim triggered coverage only if there were no insured co-plaintiffs) in the shareholder suit I v. I carve back barred coverage for a “mixed” I v. I claim. In so holding, the court focused first on the Policy’s “totally independent” language. Id. at *17. The Amerco court further held, however, that because the policy at issue did not have an allocation provision, Sphinx, rather than Miller, controlled. Id. at *20.















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On appeal, National Union has advanced the argument that allocation, whether express (i.e., granted by contractual provision) or implied, assumes both covered and non-covered claims in the same action. National Union has argued where there is an I v. I exclusion with a shareholder exception that requires the claim to be brought by a shareholder totally independently of an insured person, the exception does not apply to any mixed claim. Because a “mixed” I v. I claim is not covered from the outset when applying the “totally independent language”, allocation would never be appropriate regardless of whether the policy contains an allocation provision.

III. Conclusion

While litigation over any insurance policy exclusion is bound to be fact specific, I v. I exclusions present

particular challenges. This is because the actual language of the policies differs, including as concerning the existence of carve back exceptions. Questions present as to the identity and “capacity” of the plaintiff, while many of the exceptions to the I v. I exclusion include a factual prerequisite that must be satisfied. Further complicating matters is the disparate views various courts have taken to the application of the exclusion, leaving the D&O insurance lawyer with no firm precedent in many jurisdictions. Thus, when counseling industry clients on the I v. I exclusion, it behooves the practitioner to weigh not only the facts unique to her case, but also factor in the controlling (and potentially conflicting) precedent, along with the judicial temperament of the jurisdiction with respect to interpretation of insurance contracts as a general matter.

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2015-2016 TIPS CALENDARJuly 201530-8/3 2015 ABA Annual Meeting Swissotel Contact: Felisha A. Stewart – 312/988-5672 Chicago, IL Speaker Contact: Donald Quarles – 312/988-5708

October 201514-18 TIPS Fall Leadership Meeting Westin Kierland Resort Contact: Felisha A. Stewart – 312/988-5672 Scottsdale, AZ22-23 2015 Aviation Litigation National Program Ritz Carlton Hotel Contact: Donald Quarles – 312/988-5708 Washington, DC

November 20154–6 2015 FSLC & FLA Fall Meeting Liaison Capitol Hill Contact: Donald Quarles – 312/988-5708 Washington, DC

January 201620-22 Fidelity & Surety Committee Midwinter Meeting Waldorf Astoria Contact: Felisha A. Stewart – 312/988-5672 Hotel, New York, NY

February 20163-9 ABA Midyear Meeting Manchester Grand Hyatt Contact: Felisha A. Stewart – 312/988-5672 San Diego, CA18-20 Insurance Coverage Litigation Midyear Mtg. Arizona Biltmore Contact: Ninah Moore – 312/988-5498 Phoenix, AZ

April 20166-9 Motor Vehicle Product Liability Program Arizona Biltmore Contact: Donald Quarles – 312/988-5708 Phoenix AZ8-9 Toxic Torts Midyear Meeting Arizona Biltmore Contact: Felisha A. Stewart – 312/988-5672 Phoenix, AZ

May 201611–15 TIPS Section Spring CLE Conference Intercontinental Buckhead Contact: Felisha A. Stewart – 312/988-5672 Atlanta, GA Speaker Contact: Donald Quarles – 312/988-5708

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