United States District Court, D. South Carolina, Beaufort Division
CONTRAVEST INC., CONTRAVEST CONSTRUCTION COMPANY, and PLANTATION POINT HORIZONTAL PROPERTY REGIME OWNERS ASSOCIATION, INC., as assignee, Plaintiffs,
MT. HAWLEY INSURANCE COMPANY, Defendant.
C. NORTON, UNITED STATES DISTRICT JUDGE.
following matter is before the court on defendant Mt. Hawley
Insurance Company's (“Mt. Hawley”) motion to
stay, ECF No. 163. For the reasons set forth below, the court
denies the motion without prejudice and orders that Mt.
Hawley produce all documents except those claiming
facts of this insurance coverage dispute are stated in the
court's March 31, 2017 order, ECF No. 143; therefore, the
court dispenses with a recitation of the facts for purposes
of this order. The following facts are relevant here. On
April 6, 2018, Mt. Hawley filed the instant motion to stay
the case pending resolution of the court's in
camera review, Mt. Hawley's mandamus petition, and
Mt. Hawley's certification motion. ECF No. 163. Mt.
Hawley also submitted to the court a privilege log and
various documents for in camera review. ECF No.
April 11, 2018, Mt. Hawley requested that the Fourth Circuit
issue a writ of mandamus directing this court to vacate its
March 31, 2017 order finding the waiver of attorney-client
privilege in bad faith insurance claims. Petition for Writ of
Mandamus at 2, In re Mt. Hawley Insurance Company,
No. 18-401 (4th Cir. April 11, 2018), ECF No. 3. Mt. Hawley
also filed a motion to certify the question of
attorney-client privilege wavier in bad faith insurance
claims to the Supreme Court of South Carolina. Motion for
Certification to the Supreme Court of South Carolina, In
re Mt. Hawley Insurance Company, No. 18-401 (4th Cir.
April 11, 2018), ECF No. 6. On May 29, 2018, the Fourth
Circuit stayed any district court discovery implicating the
attorney-client privilege issue. Order, In re: Mt. Hawley
Insurance Company, No. 18-401 (4th Cir. May 29, 2018),
ECF No. 23. Then on June 19, 2018, the Fourth Circuit
certified the attorney-client privilege waiver question to
the Supreme Court of South Carolina. Order, In re: Mt.
Hawley Insurance Company, No. 18-401 (4th Cir. May 29,
2018), ECF No. 27. The Supreme Court of South Carolina has
not yet issued a ruling on the question.
Inc., ContraVest Construction Company, and Plantation Point
Horizontal Property Regime Owners Association, Inc.
(collectively, “plaintiffs”) responded to Mt.
Hawley's motion to stay on April 19, 2018. ECF No. 165.
The court held a status conference on July 11, 2018, at which
the court directed the parties to submit a letter identifying
which, if any, documents unrelated to the certified
attorney-client privilege question needed to be reviewed
in camera by the court. ECF No. 170. On July 26,
2018, the parties submitted a letter (“Letter”)
referencing and attaching the privilege log previously
submitted to the court with the documents for in
camera review. The Letter and privilege log discuss four
main categories of documents at issue: (1) attorney-client
privilege documents, tabs 1-41; (2) work-product documents,
tabs 42-51; (3) reinsurance documents, tabs 52-100; and (4)
reserves documents, tabs 101-110.
Letter, the parties agree that the in camera review
of attorney-client documents, tabs 1-41 of the privilege log,
is held in abeyance until the Fourth Circuit's mandamus
decision. The parties also note that Mt. Hawley is
investigating a privilege claim over documents in tabs 31 and
32 of the privilege log. However, the parties disagree on
three issues. The first issue is whether work-product
documents, tabs 42-51, need to be reviewed in
camera. The second issue is whether the court has ruled
on Mt. Hawley's request, raised in its motion to
reconsider, for in camera review of the reinsurance
and reserves documents, tabs 52-110. The third issue is
whether Mt. Hawley may object to producing documents in tabs
44 and 47-49 on the basis that they reference mediation.
In Camera Review
motion to stay, Mt. Hawley first requests that the production
of all documents subject to the court's orders be
suspended until the court's in camera review is
complete. ECF No. 163 at 2. The Letter indicates disagreement
over which categories of documents are currently subject to
an in camera review. The court addresses each
category in turn.
first category of documents over which the parties disagree
is the set of work-product documents, which the Letter
identifies as tabs 42-51 on the privilege log. Plaintiffs
take the position that the court has already denied in
camera review of these documents. Letter at 2. Mt.
Hawley argues that the work-product documents need to be
reviewed in camera and points to footnote 13 in the
court's order adopting the magistrate judge's report
and recommendation (“R&R”) as support for its
position. Id. (citing ECF No. 142 at 22 n.13). The
Because the at-issue waiver is so related to the relevance of
communications at issue, it seems appropriate to take the
rather unusual step of conducting an in camera
review for relevance, despite having already determined that
the privilege has been waived. In ordering such a review, the
court is mindful of the need to protect the privilege against
undue incursion under the City of Myrtle Beach
approach. It is also notable that some of the documents in