United States District Court, E.D. Virginia, Alexandria Division
MEMORANDUM OPINION & ORDER
THERESA CARROLL BUCHANAN UNITED STATES MAGISTRATE JUDGE
MATTER comes before the Court on Non-Party Erlich Law
Office's ("ELO") Motion to Quash
Defendant's Subpoena ("Mot.") (Dkt.
ELO's Motion relates to Defendant's discovery
pertaining to a potential fraud upon the Court. On November
16, 2018, this Court granted (Dkt. 57) Defendant's Motion
to Compel Limited Discovery and to Stay Due to Fraud Upon the
Court (Dkt. 50). The Court granted Defendant sixty (60) days
to conduct limited discovery into whether Plaintiff and/or
his former co-Plaintiff, Rajender Salgam, intentionally
altered emails and produced them with knowledge of their
falsity. On November 21, 2018, Defendant issued a subpoena
for documents to ELO with a return date of December 13, 2018.
(Def.'s Opp'n at 2, Ex. 1.) On December 6, 2018, ELO
moved to quash the subpoena. Defendant filed its opposition
on December 14, 2018 and ELO filed its reply on December 18,
2018. The matter is now ripe for a decision. For the
following reasons, the Court finds that the crime-fraud
exception applies and that ELO's Motion to Quash shall be
non-party, previously represented both Plaintiff and his
former co-Plaintiff, Rajender Salgam, in this litigation. ELO
served as counsel for Plaintiff and Mr. Salgam when
Plaintiffs commenced this action on January 5, 2018. However,
on September 10, 2018, ELO filed an emergency motion to
withdraw as counsel (Dkt. 27), which the Court granted on
September 11, 2018 (Dkt. 28). During the course of ELO's
representation, ELO "came into possession of documents
responsive to Defendant's subpoena by virtue of its
representation" of Plaintiff and Mr. Salgam. (Mot. at
2.) ELO claims many of the responsive documents are protected
by attorney-client and work-product privileges and moves to
quash Defendant's subpoena on those
"must quash or modify a subpoena" if compliance
with the subpoena would require "disclosure of
privileged or other protected matter, if no exception or
waiver applies." Fed.R.Civ.P. 45 (d)(3)(A)(iii).
Therefore, a court would be required to quash a subpoena upon
a proper assertion of attorney-client or work-product
privileges. Because this is a diversity action involving a
single state law claim, Virginia privilege law
applies. See Fed.R.Evid. 501; see also Koch v.
Specialized Care Servs.. Inc., 437 F.Supp.2d 362, 368
(D. Md. 2005); Adair v. EOT Prod. Co., 285 F.R.D.
376, 380 (W.D. Va. 2012). In applying state law, federal
courts sitting in diversity must interpret and apply the law
in accordance with the state's highest
court. See Koch, 437 F.Supp.2d at 374.
However, if the law is unclear then a federal court sitting
in diversity "has [an] obligation to interpret the law
... as it appears that the [state's highest court] would
rule." Wells v. Liddy, 186 F.3d 505, 527-28
(4th Cir. 1999). Should the need arise to "forecast a
decision of a state's highest court," a court may
consider, among other sources, the state's trial court
decisions. Id. at 528 (citing Liberty Mut. Ins.
Co. v. Triangle Indus., 957 F.2d 1153, 1156 (4th Cir.
well-settled in Virginia that "[confidential
communications between attorney and client made during the
course of the relationship and that relate to the subject
matter of the attorney's employment are privileged from
disclosure." Owens-Corning Fiberglas Corp. v.
Watson, 413 S.E.2d 630, 638 (Va. 1992) (citation
omitted). "However, the privilege does not permit a
litigant to commit a fraud upon a court." Id.
(citing Seventh Dist. Comm. v. Gunter, 183 S.E.2d
713, 719 (Va. 1971)). "The protection which the law
affords to communications between attorney and client has
reference to those which are legitimately and properly within
the scope of a lawful employment and does not extend
to communications made in contemplation of a crime,
or perpetration of a fraud."" Gunter, 183
S.E.2d at 719 (emphasis added) (citation omitted).
regard to "fraud on the court," however, the
Virginia Supreme Court has not provided a precise
definition. See State Farm Mut. Auto. Ins. Co v.
Remley, 618 S.E.2d 316, 320 (Va. 2005) (listing factors
to consider but not a specific test or standard to apply);
French v. Painter, 86 Va. Cir. 344, 2013 WL 8216337,
at *8 (Va. Cir. Ct. 2013) ("[T]he the Supreme Court of
Virginia has not defined the phrase 'fraud on the
court.'"). However, the Supreme Court has stated
that a controlling factor to consider in a fraud on the court
analysis is "whether the misconduct tampers with the
judicial machinery and subverts the integrity of the court
itself." Owens-Corning, 413 S.E.2d at 638
(quoting U. Bus. Commc'ns. Inc. v. Racal-Milgo.
Inc., 591 F.Supp. 1172, 1186 (D. Kan. 1984)); see
also Sevachko v. Commonwealth, 544 S.E.2d 898, 903-04
(Va. Ct. App. 2001).
applying the fraud upon a court exception, the Virginia
Supreme Court has held that a communication between an
attorney and client that involves a crime or fraudulent
scheme "abrogates" the attorney-client privilege.
Gunter, 183 S.E.2d at 719. Specifically, should a client fail
to "disclose his fraudulent purpose there is no
confidential relationship established, and no attaching
privilege." Id. (citation omitted). In
Owens-Corning, the Supreme Court of Virginia found
that the trial court did not err in applying the fraud
exception where a party submitted a false interrogatory in a
separate proceeding. 413 S.E.2d at 637-39. Similarly, in
Gunter. the Supreme Court affirmed the trial
court's rejection of the attorney-client privilege after
"communications alleged to be privileged were made in
the furtherance of the commission of an intended fraud"
and the submittal of a deliberately falsified document to a
tribunal. 183 S.E.2d at 717-20. Specifically, the defendant
in Gunter intentionally misrepresented to his
attorneys a material fact by providing them with a doctored
the Court already found at the November 16, 2018, hearing
that a prima facie showing of fraud had been met and
that the crime-fraud exception applied. (Hr'g Tr.
7:8-19.) Prior to that hearing, Defendant presented a
substantial amount of evidence establishing that emails
produced by Plaintiff and Mr. Salgam had been doctored. (Mem.
Supp. Mot. Stay at 7-11.) Those altered emails would have
likely served as critical evidence in Plaintiffs
case-in-chief. Moreover, Defendant's latest filing
provides additional evidence that either Plaintiff or Mr.
Salgam or both were involved in committing a potential fraud
on the court. (Def.'s Opp'n at 4-6.) This type of
conduct, fabricating material evidence, certainly qualifies
as a fraud on the court as it "tampers with the judicial
machinery and subverts the integrity of the court
itself." Owens-Corning, 413 S.E.2d at 638. Like
in Gunter, Plaintiff and/or Mr. Salgam appear to be involved
with intentionally misrepresenting material facts to ELO
(former counsel) and to this Court. As a result, the
existence of a fraud on the court abrogates the
attorney-client privilege in this instance. Thus, ELO must
produce any responsive documents it claims are protected by
the instant fraud upon the court also abrogates the attorney
work-product privilege. Although the undersigned could not
locate a Virginia Supreme Court case directly addressing the
application of the crime-fraud exception to the attorney
work-product privilege, it stands to reason that the same
principle applies. See Gunter, 183 S.E.2d at 719.
Moreover, several Virginia Circuit Courts have already held
that the crime-fraud exception applies to the work-product
privilege. See Peterson, 1993 WL 946382, at *1
("Just as the crime-fraud exception may serve to open
attorney-client communications to review, so too, it may
afford access to protected work product.");
Petter, 1993 WL 945900, at *1 (rejecting party's
argument that an attorney "must be an 'active'
participant in the fraud to vitiate" the work-product
privilege (citing Gunter, 183 S.E.2d at 719)).
Therefore, ELO must produce all responsive documents it
claims are protected by attorney work-product
privilege. However, because no evidence has been put
forth to indicate ELO was involved in the fraud, ELO should
be allowed to redact any documents covered by the
work-product privilege to the extent they contain ELO's
"opinion work product." See In re Grand
Jury Proceedings, 33 F.3d 342, 348-49 (4th Cir.
1994); cf Peterson, 1993 WL 946382. at *1
(applying federal law).
it is hereby
that ELO's Motion to Quash (Dkt. 60) is DENIED. ELO shall
produce all responsive documents no later than 5:00 p.m. on
Friday, January 11, 2019. ELO is allowed to make any
redactions it believes are appropriate to shield its opinion
work product from disclosure.
Clerk is directed to forward copies of this Memorandum
Opinion & Order to counsel of record.