JPMorgan Chase & Co. v. American Century Companies, Inc., C.A. No. 6875-VCN (Del. Ch. April 18, 2013).

Issue Addressed: Whether the attorney/client privilege and work product doctrine were defenses to a motion to compel?

Short Answer:  Yes in part and no in part.

Brief Overview

This letter decision provides a useful application of both the attorney/client privilege and the work product doctrine, as well as the “at-issue exception” to those protections from discovery.  This ruling is both practical and even-handed.  Although a 24-page decision is relatively short by comparison to most decisions from the Court of Chancery, I would venture to say that very few courts devote as much time and space to a careful and thorough discussion of what may appear to be a routine discovery dispute.

The following bullet points highlight some of the more noteworthy aspects of this utilitarian and scholarly decision.

●          Court of Chancery Rule 26 is the starting point for a discussion of the general principle that a party may “obtain discovery regarding any matter, not privileged, which is relevant to the subject matter involved in the pending action.  The standard of relevance is whether the discovery sought is reasonably calculated to lead to admissible evidence.”

●          An application of the work product doctrine turns in part on why the document was produced.  Unlike other courts that use the primary purpose test, that test was rejected in Delaware, which instead asks whether the document was created  “because of litigation.”  See footnote 16.

●          The amount of a “litigation reserve” that was prepared in anticipation of litigation would generally be protected from discovery as “opinion work product,” and the protection is not precluded merely because the document may also serve a business function.

●          “Opinion work product” is only discoverable in Delaware under a more stringent standard than otherwise applies to other types of work product.  See footnote 39 and accompanying text.

●          Court of Chancery Rule 33(d) refers to the well-settled standard that when replying to an interrogatory, a party may specify the records from which an answer may be derived if the burden of deriving the answer is substantially the same for the parties serving the interrogatory as for the party served, when the answer may be derived from the business records or the party upon whom the interrogatory has been served.

●          The court also discusses the “at-issue” exception to the protection afforded by the attorney/client privilege and the work product doctrine.

●          The court distinguishes the recent Comverge decision, highlighted on these pages here, that also dealt with the attorney/client privilege and work product doctrine.