Allegedly Confidential Documents Can Only Be “Generally Described” To Determine If They Are Truly Privileged
Plaintiff Parness sued attorney Weiss and his law firm (acting as film production counsel) for alleged fraud arising out of the financing of the film Gospel Hill. Plaintiff claimed production counsel made fraudulent representations the production company had good chain of title to the film screenplay, and that this proved to be false, along with the representation that Samuel L. Jackson would star in the movie. Over plaintiff’s objection, the trial judge appointed a referee to evaluate production counsel’s contention it could not defend without disclosing protected lawyer-client communications relevant to counsel’s scienter. Accepting the referee’s report that production counsel could not defend without violating the attorney-client privilege, and that attorney-client communications were relevant to the lawyer’s scienter, the trial judge dismissed claims against production counsel. Plaintiff appealed the dismissal of production counsel. Parness v. Abrams Garfinkel Margolis Bergson, LLP, Case No. B234762 (2nd Dist. Div. 7 August 14, 2012) (Perluss, J., author) (unpublished).
Finding that the reference was improper, the Court of Appeal reversed. There were two flaws in the reference procedure.
First, in camera review of documents allegedly protected by the lawyer-client privilege to determine if they are privileged is prohibited. Evid. Code section 915(b). “So long as Weiss established a prima facie claim of privilege, his motion to dismiss must be decided without examination of the contents of the assertedly privileged documents notwithstanding the ‘assumptions’ and ‘uncertainty’ about the nature of the privileged communication that troubled the trial court.” The trial court’s error here was in ordering a reference to inspect the documents.
Second, the referee made recommendations on the ultimate legal question presented by the motion that the trial judge did not independently review – and the findings of a special referee under Cal. Code of Civ. Proc. section 639 are not to be rubber-stamped, but rather require independent review by the trial judge. If the trial judge had treated the referee’s report as “advisory”, and independently reviewed it, the second problem could have been avoided.
On remand, the trial court “must decide the motion [to dismiss production counsel] by weighing the materiality of information, which can only be generally described, on the elements of scienter and intent – elements by their very nature that can be difficult to prove – and drawing conclusions about its significance from other evidence the court is permitted to review.”