Opinion
NO. 2018-CA-000821-MR
01-03-2020
REYNOLDS CONSUMER PRODUCTS, LLC, Appellant v. COMMISSIONER OF the DEPARTMENT OF WORKPLACE STANDARDS, Kentucky Labor Cabinet, Commonwealth of Kentucky, Appellee
BRIEFS FOR APPELLANT: Mitzi D. Wyrick, Louisville, Kentucky, Micah B. Schwartz, Richmond, Virginia. BRIEF FOR APPELLEE: John R. Rogers, Frankfort, Kentucky.
BRIEFS FOR APPELLANT: Mitzi D. Wyrick, Louisville, Kentucky, Micah B. Schwartz, Richmond, Virginia.
BRIEF FOR APPELLEE: John R. Rogers, Frankfort, Kentucky.
BEFORE: ACREE, LAMBERT, AND L. THOMPSON, JUDGES.
OPINION
ACREE, JUDGE:
Reynolds Consumer Products, LLC (Reynolds) appeals the Jefferson Circuit Court’s May 2, 2018 order compelling compliance with a subpoena issued by Kentucky’s Division of Occupational Safety and Health Compliance (KOSH). Reynolds argues KOSH lacked authority to issue such a subpoena or, in the alternative, the documents requested are protected by the "work-product" privilege. This Court concludes the privilege does apply and, therefore, reverses the circuit court’s order and remands for further proceedings.
We note that the Jefferson Circuit Court issued the order on September 20, 2017; however, because the case was abated for a time, the circuit court re-entered the order on May 2, 2018.
KOSH is a division of the Kentucky Labor Cabinet.
BACKGROUND
On November 4, 2015, a Reynolds employee suffered a serious injury while performing maintenance on an interfold machine located at its Louisville, Kentucky facility. Reynolds voluntarily reported the injury to KOSH, as required by both state and federal law. See 803 KAR 2:180 and 29 CFR 1904.39. During the investigation, KOSH discovered numerous health and safety violations and cited and fined Reynolds.
Kentucky Administrative Regulations.
Code of Federal Regulations.
Twenty-one days later, at Reynolds’ Richmond, Virginia factory, another Reynolds employee was injured. This time, the injury was fatal. Again, Reynolds voluntarily reported the incident to the applicable state authority, the Virginia Occupational Safety and Health Compliance Program (VOSH), for investigation. Contemporaneously with the fatal accident, Reynolds’ General Counsel, David Watson, hired Michael Brooks Consulting, LLC, to investigate its cause. Watson’s letter asked Brooks Consulting to serve as his "legal investigator" to "gather[ ] needed information for [Reynolds’] legal analysis and advice." (Record (R.) at 45.) He also asked Brooks Consulting to serve as the "consulting expert for the purposes of analyzing the information on the accident and preparing a root cause analysis [of the accident] for [Reynolds’] review." (Id. ) Watson explained he needed the information to defend Reynolds against any "civil or criminal complaints filed by public agencies or by surviving family of the deceased." (Id. ). He also instructed Brooks Consulting to mark its work as "Attorney Work-Product," to store it in a secure location, and to "share the information learned only with me and such persons as I may direct you...." (Id. )
Brooks Consulting is a safety consulting company.
Based on Brooks Consulting’s investigation, Reynolds hired additional machine safety consulting companies to conduct safety audits at several Reynolds facilities, including the Louisville facility.
Two years later, in 2017, another injury accident occurred at Reynolds’ Louisville facility. Again, Reynolds self-reported to state and federal authorities. During this KOSH investigation, the plant manager referenced the prior safety audits, including the investigation of the Virginia accident. KOSH requested those reports, but Reynolds denied the request. This resulted in KOSH issuing a subpoena in accordance with KRS 336.060.
Kentucky Revised Statutes.
Reynolds filed an action in the Franklin Circuit Court to quash the subpoena. Although the circuit court denied the motion, it did not order Reynolds to produce the subpoenaed documents. The Kentucky Labor Cabinet initiated a separate action in the Jefferson Circuit Court to compel compliance with the subpoena. In response, Reynolds informed that circuit court it intended to petition the Court of Appeals for a writ vacating the Franklin Circuit Court order. To allow time for this Court to rule on the writ petition, the Jefferson Circuit Court scheduled a show cause hearing to be conducted two months later. Ultimately, the circuit court simply stayed the hearing.
This Court denied Reynolds’ writ petition from the Franklin Circuit Court action as premature. The Jefferson Circuit Court lifted its stay and ordered Reynolds to honor the subpoena. This appeal followed.
See Reynolds Consumer Products, LLC v. Hon. Thomas D. Wingate, Judge, Franklin Cir. Ct., No. 2017-CA-001550-OA (Ky. App. Feb. 20, 2018) (order denying petition for writ of prohibition).
STANDARD OF REVIEW
A trial court has the "ultimate discretion in discoverability," even when there is a question of privilege. O'Connell v. Cowan , 332 S.W.3d 34, 44 (Ky. 2010) (quoting Morrow v. Brown, Todd & Heyburn , 957 S.W.2d 722, 727 (Ky. 1997) ). Therefore, we defer to the circuit court’s considerable discretion. However, this Court will reverse the circuit court’s order if it constitutes an arbitrary, unreasonable, unfair, or unsupported application of the law to the facts. See Commonwealth v. English , 993 S.W.2d 941, 945 (Ky. 1999).
ANALYSIS
KOSH’s Authority
Reynolds first argues KOSH lacks authority to compel the documents demanded in the subpoena, i.e. , the safety audits, because its authority cannot exceed that granted by 803 KAR 2:070, as discussed in the KOSH Field Operations Manual (Manual). It contends KOSH’s authority is limited "to review[ing] records required by KRS Chapter 338 and administrative regulations issued ... and other records which are directly related to the purpose of the inspection." 803 KAR 2:070, § 1(1). Additionally, argues Reynolds, those records must be voluntarily given by the employer. See Manual Chapter III D(7)(a)(5).
However, Reynolds fails to recognize the applicability of KRS 336.060(1). That statute authorizes the Cabinet to issue subpoenas for the "production of books, papers, and records competent and relevant to the matter under investigation[.]" Our highest court held in Cabe v. Kitchen , "[t]he provisions of KRS 336.060 and 337.320 afford wide latitude in making investigations under KRS 336.050 and require only that the records to be inspected be competent and relevant to the matter under investigation." 415 S.W.2d 96, 96-97 (Ky. 1967). Of course, the regulations and the Manual are relevant in determining the scope of the agency’s authority. However, those subordinate authorities must be read in conjunction with KRS 336.060. Doing so convinces the Court that KOSH has the authority to subpoena relevant documents. Therefore, we must decide whether the safety audits are relevant.
Black’s Law Dictionary defines "relevant" as "[l]ogically connected and tending to prove or disprove a matter in issue; having appreciable probative value – that is, rationally tending to persuade people of the probability or possibility of some alleged fact." Relevant , BLACK'S LAW DICTIONARY (10th ed. 2014). The safety audits will assist the Cabinet in determining whether there are unaddressed health and safety issues. Safety audits performed by the subject of the investigation are relevant because they are "directly related to the purpose of the inspection." See 803 KAR 2:070, § 1(1). Given the Cabinet’s broad subpoena power and authority to review relevant documents, we affirm the circuit court’s ruling on this point. KOSH does have the authority to subpoena the safety audits.
Work-Product Privilege
Reynolds next argues that the documents identified in the subpoena are protected under the "work-product" privilege. In accordance with the privilege, "documents prepared in anticipation of litigation are subject to a qualified privilege, i.e. , discoverable only upon a showing of substantial need and undue hardship...." Haney v. Yates , 40 S.W.3d 352, 356 (Ky. 2000). The substance of this privilege is codified in CR 26.02(3)(a). Reynolds contends the safety audits qualify as "work product" because they were created in anticipation of litigation.
Kentucky Rules of Civil Procedure.
A two-step analysis is necessary to determine whether a specific document claimed to be privileged is nevertheless discoverable. First, the court assessing the privilege’s applicability must determine whether the document is work product. That is, there must be a determination that the subject document was prepared "in anticipation of litigation." A document need not be created by a party’s attorney to be work product. "The policy of protecting counsel’s work product prior to litigation applies with equal force to the work product of the party’s other representatives, including private investigators." Transit Auth. of River City v. Vinson , 703 S.W.2d 482, 486 (Ky. App. 1985).
Second, if the document is work product, the court can still order its production after determining "the requesting party has a ‘substantial need’ of the document and is unable to obtain the ‘substantial equivalent’ without ‘undue hardship.’ " Duffy v. Wilson , 289 S.W.3d 555, 559 (Ky. 2009).
There is no genuine dispute that what KOSH seeks was prepared in anticipation of litigation in Virginia regarding a specific accident there. The question is whether the privilege remains viable when a party seeks to discover the work product in a subsequent, unrelated matter. We conclude it does.
There is little Kentucky jurisprudence directly addressing the question. However, we can look to O'Connell , supra , for some guidance. In O'Connell , an attorney named Brightwell had been criminally "charged with intimidating a participant in the legal process, terroristic threatening, and harassing communications in the Jefferson District Court." 332 S.W.3d at 36. "Subsequently, Brightwell filed a civil action" against a detective "alleging, among other claims, abuse of process, malicious prosecution, intentional infliction of emotional distress, and a violation of 42 U.S.C.[ ] Section 1983." Id. at 37. When he sought to discover from the prosecutor’s office the "entire litigation file on Brightwell’s prosecution[, t]he office of the Jefferson County Attorney ... responded with a motion to quash the subpoena." Id. The trial court and this Court held "the work product privilege in CR 26.02(3)(a) did not apply to [the prosecutor’s] litigation file on Brightwell’s prosecution and information regarding the prosecution because the criminal proceeding had been terminated...." Id. at 38.
United States Code.
The Supreme Court did not agree with the lower courts. The Court stated the issue as follows: "[W]e must determine if the work product privilege even applies in this case ... because the material sought was generated in anticipation of the criminal case, which is now terminated." Id. at 40. The Court immediately turned to the non-case-specific, overarching purpose of the privilege, stating, "The work-product doctrine is designed to protect an adversary system of justice, and is rooted in the United States Supreme Court’s decision in Hickman v. Taylor [, 329 U.S. 495, 67 S. Ct. 385, 91 L. Ed. 451 (1947) ]." Id. (citation and internal quotation marks omitted). Although Hickman interpreted the federal rule, Fed. R. Civ. P. 26(b)(3), our Supreme Court noted the "nearly identical" nature of CR 26.02(3)(a) and the corresponding rules of our sister states. Consequently, the Court looked to Hickman and "to other state and federal cases construing the rule for guidance on the issue." Id.
Federal Rules of Civil Procedure.
Essential to the analysis was the Court’s recognition that even if " CR 26.02(3) may not apply ... the broader work-product doctrine recognized in Hickman v. Taylor does." Id. In that context, the Court then quoted a case rendered by the United States District Court for the District of Columbia interpreting Hickman . That opinion says "the more considered view appears to be that work product protection applies (1) to materials prepared for any litigation and that (2) ... the protection survives the termination of the litigation for which it was prepared...." Id. at 41 (emphasis added) (quoting Federal Election Comm'n v. Christian Coalition , 179 F.R.D. 22, 24 (D.D.C. 1998) ).
We conclude that at least some portion of the documents covered by KOSH’s subpoena is work product of Reynolds’ attorney in anticipation of litigation. Therefore, we must reverse the circuit court’s May 2, 2018 order and remand for further proceedings.
Those further proceedings should avoid the mistakes made by the trial court in O'Connell where, as here, "[w]ithout making any distinction between factual work product or opinion work product, the trial court ... issued a blanket order...." O'Connell , 332 S.W.3d at 44. "When evaluating whether to order disclosure of work product, courts have typically distinguished between primarily factual, non-opinion work product, and opinion work product, also called ‘core’ work product, which includes the ‘mental impressions, conclusions, opinions, or legal theories of an attorney.’ " Id. at 42 (quoting Morrow , 957 S.W.2d at 724 ).
Also in O'Connell , as here, "the trial court’s order made no mention of any in camera review of the material; and there is no indication in the record that such in camera inspection was made.... [T]he Court strongly recommended ‘that production of opinion work product should not be ordered without a prior in camera inspection by the trial court.’ " Id. at 44 (quoting Morrow , 957 S.W.2d at 726 ).
Because the circuit court here, like the trial court in O'Donnell , "issued a blanket order[,]" id. , this Court cannot be certain that every document sought by KOSH was created in anticipation of any litigation. Therefore, upon remand, the circuit court should follow our jurisprudence providing guidance for this first determination. See , e.g. , Duffy , 289 S.W.3d at 559. The court should also keep in mind that we readily refer to federal and sister state jurisprudence when it is both persuasive and consistent with our own jurisprudence. O'Connell , 332 S.W.3d at 40.
If a document sought was created in anticipation of any litigation and therefore is privileged work product, "the trial court may order their disclosure" if it determines KOSH is "unable to obtain the ‘substantial equivalent’ without ‘undue hardship.’ " Duffy , 289 S.W.3d at 559.
Summarizing this section of our analysis, we are reversing and remanding with instructions to follow the procedure described in the cited authority to determine the applicability of the privilege as to the specific documents sought by KOSH.
Self-Critical Analysis Privilege
Reynolds cites federal jurisprudence to argue a self-critical/self-evaluative analysis privilege which would exempt the safety audit reports from discovery because they were self-evaluation documents. No such privilege is available under Kentucky law. University of Kentucky v. Courier-Journal & Louisville Times Co. , 830 S.W.2d 373, 378 (Ky. 1992) ("The University asks the Court to adopt a ‘self-critical analysis’ privilege which would exempt from disclosure self-evaluative documents. We refuse to judicially adopt such a privilege."). Consequently, we reject this claim of privilege.
CONCLUSION
For the foregoing reasons, we reverse the Jefferson Circuit Court’s May 2, 2018 order requiring Reynolds to comply with KOSH’s subpoena and remand for further proceedings consistent with this opinion.
ALL CONCUR.