Source: http://pa.findacase.com/research/wfrmDocViewer.aspx/xq/fac.20180329_0000462.WPA.htm/qx
Timestamp: 2019-04-25 06:41:48+00:00

Document:
Pending before the Court is the Motion to Compel (ECF No. 75) filed by Defendants CBIZ, Inc., CBIZ Benefits & Insurance Services, Inc., and Jon S. Ketzner (collectively "CBIZ"). CBIZ's Motion has been fully briefed (see ECF Nos. 75-1, 83, 86, 89, 92, 93, 100) and is ripe for disposition.
This case arises from Plaintiff UPMC's acquisition of Plaintiff Altoona Regional Health System ("Altoona")-an acquisition which allegedly came with a multimillion dollar negligent understatement of Altoona's pension plan liabilities. In the instant Motion to Compel, CBIZ asks this Court to order Plaintiffs to produce certain documents relating to Plaintiffs' communications with the Internal Revenue Service ("IRS") and other agencies. Plaintiffs respond by arguing that they have produced all relevant, responsive, and non-privileged communications requested by CBIZ. However, CBIZ disagrees that the communications in question are protected by either the attorney-client privilege or the work-product doctrine.
For the reasons that follow, CBIZ's Motion to Compel (ECF No. 75) will be GRANTED.
UPMC is a Pennsylvania nonprofit corporation with its principal place of business in Pittsburgh, Pennsylvania. (ECF No. 81 ¶ 1.) Altoona is likewise a Pennsylvania nonprofit corporation, with its principal place of business in Altoona, Pennsylvania. (Id. ¶ 2.) Plaintiffs allege that CBIZ, Inc. is a Delaware corporation with its principal place of business in Cleveland, Ohio, that CBIZ B&I is a Missouri corporation, and that Ketzner resides in Maryland. (Id. ¶¶ 4-7.) Plaintiffs seek damages "well over" $100 million. (Id. at 10.) Thus, this case is between citizens of different states and the amount in controversy exceeds $75, 000. This Court, therefore, has subject-matter jurisdiction over plaintiffs' claims under 28 U.S.C. § 1332(a)(1).
The Court previously detailed the procedural and factual background of the instant case in its Memorandum Opinion denying Defendants' Motion to Dismiss. See UPMC v. CBIZ, No. 3:16-cv-204, 2017 WL 4357984, at *l-*3 (W.D. Pa. Sept. 29, 2017) (Gibson, J.). Thus, the Court primarily relies on this prior coverage of this case's background and will not repeat those details herein. However, the Court will provide some additional background particularly pertinent to the present Motion to Compel.
As stated supra, CBIZ asks this Court to order Plaintiffs to produce documents in response to discovery request numbers 106, 107, and 109-112. (See ECF Nos. 75-1 at 2-4, 75-3 at 1.) The primary content of the discovery sought by CBIZ is communications involving UPMC, Plaintiffs' attorneys, Ernst & Young, and the IRS in connection with the resolution of potential fines, penalties, and taxes resulting from CBIZ's allegedly misstated actuarial valuations of Altoona's pension liabilities. (See ECF No. 89.) The Court notes that, hereinafter, the discovery sought by CBIZ in the instant Motion to Compel -i.e., that discovery sought by discovery request numbers 106, 107, and 109-112-will be referred to as "the penalty information." The Court will first address the preliminary issue of the continuing relevancy of this discovery after Plaintiffs amended their Complaint to exclude damages claims in relation to these fines, penalties, and taxes. The Court will then analyze the applicability of the attorney-client privilege and the work-product doctrine to the discovery sought by CBIZ.
Federal Rule of Civil Procedure 26 provides the general framework for discovery in federal civil litigation. See Fed. R. Civ. P. 26. Rule 26(b)(1) defines the scope of discovery as "any nonprivileged matter that is relevant to any party's claim or defense and proportional to the needs of the case." Fed.R.Civ.P. 26(b)(1). A matter is relevant if "it has any tendency to make a fact more or less probable than it would be without the evidence; and ... the fact is of consequence in determining the action." See Fed. R. Evid. 401. In determining whether discovery is proportional to the needs of the case, courts must consider "the importance of the issues at stake in the action, the amount in controversy, the parties' relative access to relevant information, the parties' resources, the importance of the discovery in resolving the issues, and whether the burden or expense of the proposed discovery outweighs its likely benefit." Fed.R.Civ.P. 26(b)(1).
Rule 37 provides the mechanism to compel discovery from a person or party who refuses to provide discovery. See Fed. R. Civ. P. 37. The party moving to compel discovery under Rule 37 bears the initial burden of proving the relevance of the material requested. See UPMC v. CBIZ, Inc., No. 3:16-cv-204, 2017 WL 4129654, at *2 (W.D. Pa. Sept. 15, 2017) (Gibson, J.) (citing Morrison v. Phila. Hous. Auth., 203 F.R.D. 195, 196 (E.D. Pa. 2001)). If the movant meets this initial burden, then the burden shifts to the person resisting discovery to establish that discovery of the material requested is inappropriate. Id. (citing Momah v. Albert Einstein Med. Ctr., 164 F.R.D. 412, 417 (E.D. Pa. 1996)). The person resisting discovery must explain with specificity why discovery is inappropriate; the boilerplate litany that the discovery sought is overly broad, burdensome, oppressive, vague, or irrelevant is insufficient. See id (citing Josephs v. Harris Corp., 677 F.2d 985, 991-92 (3d Cir. 1982)).

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