The opinion of the court was delivered by: Hon. Thomas J. Whelan United States District Judge
ORDER OVERRULING DEFENDANTS' OBJECTION TO AND RELATED CROSS ACTIONS. MAGISTRATE JUDGE'S MARCH 24, 2011 DISCOVERY ORDER [DOCS. 94, 96]
Pending before the Court is Defendants' objection to United States Magistrate Judge Bernard G. Skomal's March 24, 2011 discovery order. (Doc. 91.) Judge Skomal granted Plaintiffs' request for the unredacted copies of theinvestigative reports prepared by Sedgwick, Detert, Moran and Arnold LLP ("SDMA"), and ordered Defendants to produce the copies to Plaintiffs. The reports concern SDMA's investigation of Plaintiffs and former Tri-City Healthcare District ("TCHD") Chief Executive Officer Art Gonzalez.
The Court decides the matter on the papers submitted and without oral argument. See Civ. L.R. 7.1(d.1). For the following reasons, the Court OVERRULES Defendants' objection. (Docs. 94, 96.)
Plaintiffs are former senior executives of Defendant TCHD. On December 18, 2008, TCHD placed Plaintiffs on paid administrative leave to investigate their potential misconduct and poor job performance. TCHD retained law firm SDMA to conduct the investigation and report its findings. Attorney Joseph McFaul of SDMA conducted the investigation. McFaul prepared and provided TCHD with three written investigative reports. A fourth non-attorney report was also provided to TCHD. Based on these reports, TCHD's Board of Directors authorized then-interim Chief Executive Officer, Defendant Larry Anderson, to terminate Plaintiffs. On April 24, 2009, Plaintiffs were terminated.
On July 15, 2009, Plaintiffs filed a complaint in San Diego Superior Court, and on July 22, 2009, the lawsuit was removed to this Court. As a part of TCHD's initial disclosures, TCHD produced substantial portions of the investigative reports that it contended contain or discuss factual findings. However, TCHD redacted several sections of these reports. It contended that the redacted materials are protected by attorney-client privilege and the work-product doctrine. TCHD produced 364 pages containing the four reports-292 of which were prepared by McFaul-but redacted pages 157-61, 168, 173-74 and 201. Thereafter, Plaintiffs sought production of the unredacted copies of the investigative reports.
On October 29, 2010, the parties filed a joint motion for discovery regarding the investigative reports. On March 24, 2011, Judge Skomal granted Plaintiffs' request for the unredacted copies, and ordered Defendants to produce these copies to Plaintiffs no later than April 1, 2011. Judge Skomal found that the unredacted investigative reports are protected by attorney-client privilege and the work-product doctrine. However, he further found that Defendants waived these protections because: (1) they voluntarily produced and relied on these reports; (2) the disclosed and undisclosed communications concern the same subject matter, McFaul's investigation of Plaintiffs; and (3) fairness dictates that TCHD may not selectively disclose privileged and work-product protected information.
Defendants did not comply with the deadline to produce the unredacted copies. Rather, on April 11, 2011, they filed an objection to Judge Skomal's March 24, 2011 discovery order. Then, on April 20, 2011, Defendants submitted the unredacted copies of the investigative reports to this Court and requested an in camera review. Plaintiffs oppose the objection and the request for an in camera review.
A party may object to a non-dispositive pretrial order of a magistrate judge within fourteen days after service of the order. See Fed. R. Civ. P. 72(a). The magistrate judge's order will be upheld unless it is "clearly erroneous or contrary to law." Id.; 28 U.S.C. § 636(b)(1)(A). The "clearly erroneous" standard applies to factual findings and discretionary decisions made in connection with non-dispositive pretrial discovery matters. F.D.I.C. v. Fid. & Deposit Co. of Md., 196 F.R.D. 375, 378 (S.D. Cal. 2000); Joiner v. Hercules, Inc., 169 F.R.D. 695, 697 (S.D. Ga. 1996) (reviewing magistrate judge's order addressing attorney-client issues in discovery for clear error). Review under this standard is "significantly deferential, requiring a definite and firm conviction that a mistake has been committed." Concrete Pipe & Prods. of Cal., Inc. v. Constr. Laborers Pension Tr. of S. Cal., 508 U.S. 602, 623 (1993) (internal quotation marks omitted).
On the other hand, the "contrary to law" standard permits independent review of purely legal determinations by a magistrate judge. See, e.g., Haines v. Liggett Group, Inc., 975 F.2d 81, 91 (3d Cir. 1992) ("the phrase 'contrary to law' indicates plenary review as to matters of law."); Gandee v. Glaser, 785 F. Supp. 684, 686 (S.D. Ohio 1992), aff'd, 19 F.3d 1432 (6th Cir. 1994) ("Thus, [the district court] must exercise its independent judgment with respect to a magistrate judge's legal conclusions."); 12 Charles A. Wright, et al., Federal Practice and Procedure § 3069 (2d ed., 2010 update). "A decision is contrary to law if it fails to apply or misapplies relevant statutes, case law, or rules of procedure." United States v. Cathcart, No. C 07-4762 PJH, 2009 WL 1764642, at *2 (N.D. Cal. June 18, 2009).
Subject-matter waiver is governed by Federal Rule of Evidence 502, which applies to disclosures of information covered by attorney-client privilege and work-product protection. Rule 502(a) provides that a waiver resulting from a disclosure of protected information in a federal proceeding extends to undisclosed protected materials "only if:
(1) the waiver is intentional; (2) the disclosed and undisclosed communications or information concern the same subject matter; and (3) they ought in fairness to be considered together." Fed. R. Evid. 502(a). "The idea is to limit subject matter waiver to situations in which the privilege holder seeks to use the disclosed material for advantage in the litigation but to invoke the privilege to deny its adversary access to additional materials that could provide an important context for proper understanding of the privileged materials." 8 Charles Alan Wright, et al., Federal Practice and Procedure § 2016.2 (3d ed., 2010 update). Thus, subject-matter waiver "is reserved for those unusual situations in which fairness requires a further ...