Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_10-cv-03989/USCOURTS-cand-3_10-cv-03989-16/pdf.json

Nature of Suit Code: 430
Nature of Suit: Banks and Banking
Cause of Action: 12:1821 Default of Loan by Promissary Note

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COURT

For the Northern District of California

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UNITED 

STATES 

DISTRICT 

COURT

For the Northern District of California

UNITED STATES DISTRICT COURT

Northern District of California

E. LYNN SCHOENMANN, Trustee of the

Bankruptcy Estate of UCBH Holdings, Inc.,

Plaintiff,

v.

FEDERAL DEPOSIT INSURANCE

CORPORATION, in its capacity as receiver

for United Commercial Bank, and in its

corporate capacity,

Defendant.

_____________________________________/

No. C 10-03989 CRB (MEJ)

DISCOVERY ORDER

Re: Dkt. Nos. 130, 133

I. INTRODUCTION

On September 19, 2013, the parties in this action filed a joint discovery letter regarding a

dispute over a subpoena served by the FDIC-Receiver on non-party witness Doreen Woo Ho. Dkt.

No. 130. Ms. Ho has withheld documents responsive to the subpoena based on objections asserted by

Plaintiff/Trustee E. Lynn Schoenmann. After reviewing the parties’ joint letter and holding a

telephonic conference with the parties, on October 28, 2013, the Court granted the FDIC-Receiver’s

request for leave to file a Motion to Compel and issued an Order setting forth a briefing schedule and

hearing date on the matter. Dkt. No. 132. On November 4, 2013, the FDIC-Receiver filed its Motion

to Compel (Dkt. No. 133), and on November 11, 2013, the Trustee filed her Opposition (Dkt. No.

137). The Court held a hearing on the matter on November 21, 2013. After considering the parties’

arguments and controlling authorities, the Court DENIES the FDIC-Receiver’s Motion to Compel. 

II. BACKGROUND

Plaintiff is the Chapter 7 Trustee for the bankruptcy estate of UCBH Holdings, Inc., the

holding company for United Commercial Bank. Mot. at 1. On November 6, 2009, the California

Department of Financial Institutions (“CDFI”) closed UCB and appointed the FDIC-Receiver as 

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receiver. Id. From September 4, 2009, until UCB failed on November 6, 2009, Ms. Ho was the

acting president and CEO of both UCB and UCBH. Id. In September 2010, the Trustee filed the

instant lawsuit, asserting claims against both the FDIC-Receiver and the FDIC in its corporate

capacity. Dkt. No. 1. 

The parties’ current discovery dispute centers around communications between the Trustee

and her attorney and Ms. Ho. According to the FDIC-Receiver, the Trustee and her lawyer contacted

Ms. Ho about this lawsuit and, through a series of email messages, persuaded her to sign a declaration

that was drafted by the Trustee’s lawyer. Id. On May 30, 2013, the FDIC-Receiver served a thirdparty subpoena duces tecum on Ms. Ho, seeking in part:

2. Any written statement, declaration, affirmation, affidavit, certification, transcript,

or other similar Document reflecting Your actual or proposed testimony in connection

with any matter at issue in the Action, including without limitation all drafts of such

Document.

3. All Communications between You and the Trustee or anyone acting on her behalf

relating to the Action or the claims or defenses asserted in the Action. 

Clarke Decl. ¶ 2, Ex. 1, Dkt. No. 134. The Trustee was provided notice of the subpoena at the time it

was issued. In response, on June 5, 2013, the Trustee served an Objection to the subpoena “to the

extent the subpoena purports to require Ms. Ho to produce documents that reflect or comprise the

work product or materials prepared in anticipation of litigation or for trial by the Trustee or her

counsel . . . .” Id., ¶ 4, Ex. 3. 

Thereafter, on July 1, 2013, Ms. Ho served her Objections and Responses to the subpoena. 

Id., Ex. 4. Ms. Ho’s attorney indicated that Ms. Ho was withholding from production 19 pages of

documents consisting of email communications between Ms. Ho and the Trustee or the Trustee’s

lawyer that occurred between May 31 and June 25, 2012. Id., Ex. 5. Thereafter, on July 31, 2013,

Ms. Ho’s counsel provided the FDIC-Receiver with a privilege log describing the withheld

documents in greater detail. Clarke Decl., Ex. 8. Specifically, at issue are five email messages

between Ms. Ho and the Trustee, eight email messages between Ms. Ho and the Trustee’s counsel,

and at least two drafts of a declaration sent to Ms. Ho by the Trustee’s counsel. Presently, Ms. Ho

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does not object to the production of the documents at issue or assert any privilege, but has withheld

them to avoid waiving the Trustee’s asserted privileges. See id., ¶¶ 5, 6 & Exs. 4, 5; Joint Letter, Dkt.

No. 130 at 3. The FDIC-Receiver now seeks an order compelling production of these documents. 

III. DISCUSSION

A. Work Product Doctrine

The parties first dispute whether the documents sought constitute work product. The work

product doctrine is set forth in Rule 26(b)(3) of the Federal Rules of Civil Procedure, which protects

from discovery materials containing the mental impressions, conclusions, legal opinions, or legal

theories of a party’s attorney. Fed. R. Civ. P. 26(b)(3); In re Grand Jury Subpoena, 357 F.3d 900,

906 (9th Cir. 2004). “The work product doctrine protects from discovery documents and tangible

things prepared by a party or his representative in anticipation of litigation.” United States v. Richey,

632 F.3d 559, 567 (9th Cir. 2011); Hawker v. BancInsurance, Inc., 2013 WL 6843088, at *6 (E.D.

Cal. Dec. 27, 2013). However, the work product doctrine creates only qualified protection of such

materials: a party may only obtain discovery of these items upon a showing that they are relevant and

there is a substantial need for the materials to prepare its case and the inability to obtain the materials

or their substantial equivalent by other means. Fed. R. Civ. P. 26(b)(3)(A)(i), (ii).

Generally, “[a]n attorney’s work product is the product of his effort, research and thoughts in

the preparation of the client’s case.” Hawker, 2013 WL 6843088, at *6 (citing 2022 Ranch, L.L.C. v.

Superior Court, 113 Cal. App. 4th 1377, 1389 (2003)). This “includes the results of his own work,

and the work of those employed by him or for him by his client, in investigating both the favorable

and unfavorable aspects of the case, the information thus assembled, and the legal theories and plan

of strategy developed by the attorney – all as reflected in interviews, statements, memoranda,

correspondence, briefs, and any other writings reflecting the attorney’s ‘impressions, conclusions,

opinions, or legal research or theories,’ and in countless other tangible and intangible ways.” 2022

Ranch, L.L.C., 113 Cal. App. 4th at 1389. The party asserting work-product protection over material

bears the burden of establishing the applicability of the doctrine. Skynet Elec. Co. v. Flextronics Int’l,

Ltd., 2013 WL 6623874, at *2 (N.D. Cal. Dec. 16, 2013). 

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According to the Trustee, any declarations Ms. Ho may have provided and any information

“extracted from Ms. Ho and her counsel” during the communications at issue are the work product of

the Trustee and her counsel. Opp. at 9. The FDIC-Receiver, however, contends that the Court should

overrule the Trustee’s work product objection on three grounds. First, the FDIC-Receiver argues that

“[w]hen they elected to communicate with a third-party witness, and to document those

communications in emails and drafts of a declaration that were sent to that witness, the Trustee and

her lawyer waived any work product protection that they might have claimed with respect to the

content of those communications.” Mot. at 7. Second, it argues that “because the undisputed purpose

of those communications was to persuade Ms. Ho to provide a sworn statement for use in this action

and to discuss what such a sworn statement might say, Rule 612 of the Federal Rules of Evidence

permits discovery of the documents and ‘any privilege or work product protection . . . is deemed

waived.” Id. (citing United States v. 22.80 Acres of Land, 107 F.R.D. 20, 25 (N.D. Cal. 1985);

Simmons v. Morgan Stanley Smith Barney, LLC, 2013 WL 879820, at *2 (S. D. Cal. Mar. 8, 2013);

Mattel, Inc. v. MGA Entm’t, Inc., 2010 WL 3705782, at *5-6 (C.D. Cal. Aug. 3, 2010)). Third, the

FDIC-Receiver argues that even if the work product doctrine applied, it “must give way based on

defendants’ ‘substantial need’ for the materials to prepare their case.” Mot. at 7-8. Specifically, it

argues that the documents must be produced because it is entitled to test Ms. Ho’s credibility based

on the Trustee’s communications with her and the drafts of the declaration that the Trustee’s lawyer

prepared and provided to her. Id. at 8. 

With respect to the email communications between Ms. Ho and the Trustee and Ms. Ho and

the Trustee’s attorney, as well as the draft declarations attached and exchanged during those such

communications, the Court finds that these materials constitute work product and are protected from

disclosure. See Inst. for Dev. of Earth Awareness v. PETA, 272 F.R.D. 124, 125 (S.D.N.Y. 2011)

(finding that draft affidavits of non-party witnesses prepared by defense counsel were work product

and denying the plaintiff’s motion to compel production of the drafts); In re Convergent Tech. Second

Half 1984 Sec. Litig., 122 F.R.D. 555, 559-64 (N.D. Cal. 1988); Tuttle v. Tyco Eelc. Installation

Servs., Inc., 207 WL 4561530, at *2 (S.D. Ohio Dec. 21, 2007) (“[T]he work product doctrine does

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protect information relevant to the evolution of an affidavit, including but not limited to

communications with counsel relating to the affidavit, prior drafts of the affidavit, and any notes

made by counsel while engaging in the process of drafting the affidavit.”); Randleman v. Fidelity

Nat’l Title Ins. Co., 251 F.R.D. 281, 285 (N.D. Ohio 2008) (finding draft affidavits and counsel

correspondence are protected work product); see also William W. Schwarzer, et al, Federal Civil

Procedure Before Trial ¶ 11:918.1 (Rutter Group, 2013); Wright & Miller, Federal Practice &

Procedure § 2024 n. 24 (“Recent cases have generally held that draft affidavits, and communications

with counsel relating to affidavits, are covered by the work-product rule.”) Likewise, as to the any

declaration signed by Ms. Ho, the Court agrees with the Trustee that the document is work product. 

See Intel Corp v. VIA Tech., Inc., 204 F.R.D. 450, 452 (N.D. Cal. 2001) (finding declaration of nonparty was “clearly work product right up until the moment it was filed.”). 

None of the FDIC-Receiver’s arguments set forth above are sufficient to overcome this

protection. The Court is unpersuaded by the FDIC-Receiver’s argument that by communicating with

Ms. Ho, the Trustee and her counsel somehow took steps amounting to a knowing and voluntary

waiver of such protection. See In re Convergent Tech. Second Half 1984 Sec. Litig., 122 F.R.D. at

565; Skynet Elec. Co., 2013 WL 6623874, at *3. The Trustee’s argument regarding Federal Rule of

Evidence 612 is also unavailing. As the Trustee points out, Ms. Ho is not using a writing to refresh

her memory. Rule 612 is inapplicable in this instance and none of the decisions the FDIC-Receiver

have cited in support of its argument establish otherwise. Finally, the FDIC-Receiver has not

demonstrated a substantial need sufficient to vitiate the protection afforded to the materials as work

product. The Trustee identified Ms. Ho in her initial disclosures and the FDIC-Receiver had the

opportunity to depose Ms. Ho to invstigate any relevant information she may possess with respect to

the Trustee’s claims or its defenses. Its decision not to pursue such discovery does not create

substantial need under Rule 26(b)(3)(A)(ii). 

In sum, the Court finds that the email messages between Ms. Ho, the Trustee, and the

Trustee’s attorney, the declaration drafts exhanged, and the signed declaration are protected work

product. The Court therefore DENIES the FDIC-Receiver’s Motion to Compel production of such

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materials. 

B. Attorney-Client Privilege 

The parties next dispute whether the materials are protected by attorney-client privilege. The

FDIC-Receiver argues that the Trustee did not assert that the withheld documents were subject to

attorney-client privilege until she responded to the FDIC-Receiver’s first draft of the joint discovery

letter. Mot. at 8. It points out that the Trustee neither asserted attorney-client privilege in her written

objection to the subpoena or at the parties’ August 2013 conference about the subpoena. Id. It thus

argues that the Trustee’s delay in asserting an objection based on attorney-client privilege amounts to

a waiver. Id. 

Even if the privilege was not waived, the FDIC-Receiver contends that it is inapplicable. Id. 

It argues that the privilege only covers confidential disclosures by a client to an attorney to obtain

legal advice and the attorney’s response to such disclosures, but does not protect information that an

attorney obtains from a witness while acting for his client in anticipation of litigation. Id. (citing

Hickman v. Taylor, 329 U.S. 495, 508 (1947); In re Grand Jury Investigation, 974 F.2d 1068, 1070

(9th Cir. 1992)). The FDIC-Receiver contends that here, Ms. Ho was not a client of the Trustee or

the Trustee’s lawyer and she was not communicating with either to obtain legal advice. Instead, the

subject of the communications was to obtain Ms. Ho’s sworn statement and to craft what that

statement would say. Id. at 9. 

Finally, the FDIC-Receiver contends that “[e]ven if the Trustee could cloak her

communications with Ms. Ho in the veil of UCBH’s privilege based on Ms. Ho’s prior employment

(which she cannot do), the privilege could not be used to withhold materials from the FDIC-Receiver

. . . [because] Ms. Ho was the chief executive officer of both the Bank and its holding company

during the relevant period.” Id. The FDIC-Receiver thus asserts that it has an equal claim to any

attorney-client privilege and the Trustee cannot assert that privilege to the exclusion of the FDICReceiver. 

In response, the Trustee argues that she timely asserted an objection to Ms. Ho’s production

of the materials based on attorney-client privilege. Opp. at 7. The Trustee further contends that, as a

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former employee of UCBH, she and her attorney’s communications with Ms. Ho are privileged. Id. 

She argues that whether Ms. Ho was seeking legal advice is irrelevant because “[t]he Trustee’s

counsel was obtaining relevant information from her as a former UCBH officer to advise and

represent the Trustee in this litigation.” Id. 

With respect to whether the Trustee waived an objection based on attorney-client privilege,

the Court agrees with the Trustee that both Ms. Ho and the Trustee timely asserted such objection. 

See Clarke Decl., Ex. 4 (Ho Objection) at 3, ¶ 2; Ex. 5 at 18. Nevertheless, the Court finds that the

privilege does not apply in this scenario. As the FDIC-Receiver points out, Ms. Ho was not

communicating with the Trustee and her counsel to obtain legal advice and was not a client of the

Trustee’s counsel. The Court therefore overrules the Trustee’s objection on this basis. 

C. Request to Preclude Inquiry into the Communications between Ms. Ho and the Trustee 

and Her Attorney

In her Opposition, the Trustee requests that the Court preclude the FDIC-Receiver from

inquiring into the fact or subject-matter of Ms. Ho’s communications with the Trustee and her

counsel. Opp. at 11. The Trustee also charges that the FDIC has engaged in improper ex parte

communications with Ms. Ho and obtained privileged information about communications with Ms.

Ho and the documents she is withholding. Id. The FDIC-Receiver counters that “[t]here is no

justification for such a ‘gag order,’ which would shield a potentially adverse witness from crossexamination into a source of potential bias.” Mot. at 11. 

The Court has considered the parties’ arguments and agrees with the Trustee that to uphold

the protections afforded by the work-product document as to the withheld materials, the FDICReceiver is precluded from questioning Ms. Ho regarding the communications she had with the

Trustee and the Trustee’s counsel. This does not, however, preclude the FDIC-Receiver discovering

any of the underlying factual information Ms. Ho may possess that she provided to the Trustee or her

attorney. 

/ / /

/ / /

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UNITED 

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For the Northern District of California

Accordingly, the Court GRANTS the Trustee’s request in part and DENIES it in part. 

IV. CONCLUSION

For the reasons set forth above, the Court DENIES the FDIC-Receiver’s Motion to Compel. 

IT IS SO ORDERED.

Dated: January 6, 2014 _______________________________

Maria-Elena James 

United States Magistrate Judge 

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