#CaseoftheWeek Episode 83: Blanket Waiver of Privilege

In this case of the week, we continue with court battle between Twitter and Elon Musk. Episode 83 is a review of the decision on whether a blanket waiver of privilege over 7200 documents was permitted by the Court. Kelly Twigger will also shares the steps you can take in advance of reviewing documents.

The court case is Twitter, Inc. v. Musk, 2022 WL 4397186 (Del. Ch. 2022) from September 23, 2022 and this decision is from Chancellor Kathaleen S. McCormick. If you missed the previous episode that kicked off this series of Case of the Week focused on the social media platform and the innovator, you can skim the previous episodes before continuing.

Keep reading or watch the video to understand the eDiscovery issues.

Good morning, and welcome to Episode 83 of our Case of the Week series, published in partnership with ACEDS. My name is Kelly Twigger. I am the CEO and founder of eDiscovery Assistant, as well as the principal at ESI Attorneys. Thanks so much for joining me today.

This one is from September 23, 2022, and in this latest dispute, the Court dismisses Elon Musk’s request for a blanket waiver of privilege over 7,200 documents that are withheld by Twitter, many of which were created during the eight-week period between Musk’s tweet abandoning the purchase deal of Twitter and his final notice of termination that really led to this litigation.

In eDiscovery Assistant, as always, we tag each decision with our proprietary issue structure. This week’s case includes sampling, attorney-client privilege, clawback, privilege log, in camera review, waiver, and failure to produce. This is the sixth discovery dispute resolved by the Court via letter decision. Let’s talk a little bit about the facts of this case.

Background

As you’re aware from previous episodes of Case of the Week, this is a case in which Twitter sued Elon Musk to enforce the purchase agreement that Musk made for Twitter to take it private. In this decision, which came out just about three weeks before trial was set to commence, Musk moves to compel production of 7,200 documents that were withheld as privileged by Twitter in its latest document production.

Musk sought a blanket waiver of the attorney-client privilege as to all of those documents, or a production of discrete sets of items from the plaintiff’s privilege log, including emails for which no attorney was present on the two from CC or BCC line. He also sought email notifications for Google document comments, and emails concerning business advice.

Analysis

All right, so how did the Court interpret this request on its motion to compel? Well, the Court starts with the analysis of privilege and that the party asserting the privilege has the burden of proving the privilege applies to each communication. And that burden requires “a specific designation and description of the documents within its scope, as well as precise and certain reasons for preserving their confidentiality.” The Court also notes that because of the expedited nature of this case, that the Court has offered “additional leeway to the parties in preparing their logs,” but does not really elaborate at all on what that leeway consists of here.

The Court first takes up Musk’s contention that there should be a blanket waiver of privilege attached to all 7,200 documents, and the Court does so by reviewing two cases that are cited by Musk in favor of waiver, and finds that both of those cases are inapplicable. That, in essence, Twitter provided the descriptions for each entry that states the type of document, the subject of the document, and the basis for asserting privilege. And the Court notes that inconsistent redactions in a few places on those privilege documents are going to happen in an expedited proceeding and that is not enough for a blanket waiver.

Musk also argued that Twitter’s withholding of 22% of its responsive, non-duplicative, non-automated documents as privilege necessitates a per se finding of bad faith. The Court rejected that argument. It says that Musk is really incorrect as to the percentages, but that half of the entries relate to the eight-week period between when Musk tweeted that the deal was on hold and his termination letter, which was, according to the Court, clearly a time when the privileged communications would skyrocket given the uncertainty of the merger.

Now, the Court noted that Twitter also engaged Delaware Counsel—which we’ve noted on previous Case of the Week sessions is crucial here—to conduct a thorough review process that led to a production of an additional 6,300 documents being produced that had been earmarked as privileged. And that Delaware Counsel submitted an affidavit from counsel with those facts, detailing the efforts that were undertaken to review privileged documents.

Musk then argued that the plaintiff’s employees had a practice of marking sensitive communications as privileged, and then copying a lawyer on such information, and cited a deposition in which the witness testified that she had learned to include a lawyer on sensitive communications. The Court really relied on the sworn statement of counsel and the efforts that were made by counsel to detail the efforts of review for privilege and rejected that argument from the defendant.The Court denied the motion for a blanket waiver.

The second part of this motion sought to compel production of just under 3,000 documents on the privilege log where no attorney is listed on the To, From, CC or BCC line, as well as Twitter’s clawback of 11 Google document comment emails that it alleges contain only business advice. For this part of the motion, the Court tells the parties to prepare to present issues during a hearing on September 27, and that the Court is considering whether an in-camera review or sampling of documents is appropriate, and potentially engaging a third-party neutral appointed by the Court to do that. There’s additional work to be done on this particular motion.

Now, since we’re at October 4 and this case is moving at the speed of flight, I’ll tell you that the Court has already held that hearing on the 27th, obviously, and that at that time the Court decided to appoint a third party neutral to review the documents for consideration of privilege. In a decision, I believe just yesterday or the day before, the court-appointed neutral had to remove himself for conflict purposes, and the Court has decided to take upon itself the in-camera review of a sampling of those documents. So further information to come on this privilege ruling.

Takeaways

All right, what are our takeaways from today? Well, in reading this case, I’m really hoping that there’s more to this challenge than what’s included in this letter decision from the Court. It seems rather thinly veiled that Musk is doing its best to bury Twitter in motion practice while Twitter tries to prep for the trial that is scheduled to start on October 17. It’s pretty broad to make a claim that there should be a blanket waiver of 7,200 documents in a case based on some failures that are not well articulated here.

Now, as a general rule, privilege logs are continuing to be an enormous issue in electronic discovery. We have 234 cases in eDiscovery Assistant from this year alone that deal with disputes over the contents of the privilege log. And looking at the facts of this case—and what’s argued by Musk against Twitter— there are ways to make the process of creating an automated privilege log much easier if you do the work in advance of starting to review the documents.

We’ve talked about this process a little bit, but I’ll lay it out for you so that you can begin to employ it in your cases. If you start at the outset of the case, before you’re doing review, by identifying the scope of privileged communications across people and entities (you’re really looking for specific employees who tend to communicate with legal regularly, in house lawyers, outside lawyers, and law firms, or any other entities over which privilege would apply), and you create a filter. You’re going to create what we call a privilege filter; that’s then applied when you load the documents so that those documents that meet the privilege filter will then be book tagged as potentially privileged or whatever you choose so that a separate privilege review can be done while the responsiveness review is also ongoing.

You can also then create a specific privilege review coding panel in your review tool that allows you to add the type and basis for the privilege as well as make notes, and then all of those fields can be exported as part of your privilege log, and it’s largely done except for a final review.

The last thing to do, as we always talk about on the Case of the Week, is to document, document, document your review process, so that if required, like here, you can submit an affidavit or a declaration to the court on your efforts to review for privilege and the considerations that were made.

Now, much of what is needed for that log can be automated by pulling standard metadata fields from your review software, exporting it and then following up on those specific entries. So, take those steps, use this decision to understand what those challenges can be and how you’re going to refute them with documentation from counsel about the process that’s undertaken.

Conclusion

Alright, that’s our Case of the Week for this week. Thank you so much for joining me. We’ll be back again next week with another decision from our eDiscovery Assistant database. If you’re interested in doing a free trial of our case law and resource database, sign up to get started.

Thanks so much. Have a great rest of the week and I’ll see you on our next episode.

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