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Chapter: 77.6

Case Name: Armouth International, Inc. v. Dollar General Corp., No. 3:14-0567, 2015 U.S. Dist. LEXIS 148784 (M.D. Tenn. Nov. 2, 2015)
(finding that the attorney-client privilege protected communications to and from a company's in-house lawyer also serving as its compliance director; "According to Dollar General, the communications at issue involve emails that are: (1) from Mr. Stephenson [Dollar General's "Assistant General Counsel," who also served as "head of the Compliance Department" and "supervisor to the Senior Director of Global Sourcing"] providing legal advice to Dollar General employees regarding the tested merchandise; (2) from employees to Mr. Stephenson requesting legal advice; (3) from employees to Mr. Stephenson providing information necessary for Mr. Stephenson to provide adequate legal advice regarding the tested merchandise; or (4) between employees relaying Mr. Stephenson's legal advice as it pertains to the ongoing situation with Armouth [supplier of products to Dollar General, suing the company for not paying its invoices]. . . . Dollar General contends that all such communications are protected by the attorney-client privilege."; "In Zolin [U.S. v. Zolin, 491 U.S. 554, 570-71, 109 S.Ct. 2619, 105 L.Ed.2d 469 (1989)], the Supreme Court delineated the standard for determining whether an assertion of attorney-client privilege warrants an in camera review by the presiding judge. While the Supreme Court applied this standard specifically to the crime-fraud exception, this Court finds that the standard is appropriate in this matter to evaluate whether the documents requested for in camera review may reveal evidence of business advice that is not shielded from discovery by the attorney-client privilege."; "[A]s Dollar General states in its response, the decision to release the hold was made by Mr. Stephenson precisely because it required the legal opinion of an attorney. . . . Furthermore, even if Mr. Stephenson had considered some aspects of business in making his decision, such consideration does not necessarily remove the coverage afforded by the attorney-client privilege. Dollar General correctly notes that district courts have held that the 'mere fact that business considerations are weighed in the rendering of legal advice does not vitiate the attorney-client privilege."; "The privilege log indicates that this email consisted of Mr. Vasos 'relaying Rob Stephenson's legal advice related to the non-conforming scrubs' to Mr. Gatta. . . . This appears to match the substance of the email's content prior to the redacted portion, which concludes with, 'now for the bad news. Their label does not match the product.'. . . It is logical that the remainder of the email would pertain to Mr. Stephenson's legal advice regarding the nonconforming goods."; agreeing with Dollar General that the company's decision to put a hold on the invoices primarily involved a legal rather than a business issue; "Here, Dollar General's claims of privilege are narrow and specific. Dollar General has reasonably rebutted the speculation by Armouth that Mr. Stephenson was giving business advice (or predominately giving business advice) rather than legal advice.")

Case Date Jurisidction State Cite Checked
2015-11-02 Federal TN
Comment:

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