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McDermott Will & Emery LLP v. Superior Court (Richard P. Hausman)

California Court of Appeals, Fourth District, Third Division

April 18, 2017

McDERMOTT WILL & EMERY LLP et al., Petitioners,
v.
THE SUPERIOR COURT OF ORANGE COUNTY, Respondent RICHARD P. HAUSMAN, SR., et al., Real Parties in Interest.

         Original proceedings; petition for a writ of mandate to challenge two orders of the Superior Court of Orange County, Nos. 30-2015-00785773, 30-2015-00785872 Sheila Fell, Judge. Petition denied.

          Gibson, Dunn & Crutcher, James P. Fogelman, Julian W. Poon, Shannon E. Mader and Jennafer M. Tryck for Petitioners.

          No appearance for Respondent.

          Sall Spencer Callas & Krueger, Robert K. Sall, Suzanne Burke Spencer and Michael A. Sall for Real Parties in Interest.

          OPINION

          ARONSON, J.

         In this original proceeding, we consider several issues relating to a confidential attorney-client communication, including (1) whether the client waived the attorney-client privilege by disclosing the communication to third parties, and (2) whether the trial court erred in disqualifying the law firm that represented one of those third parties because its attorneys failed to notify the client or the client's attorney that counsel had obtained a copy of the communication, reviewed and analyzed the communication, and used it in the lawsuit.

         The trial court found that plaintiff and real party in interest Richard P. Hausman, Sr. (Dick), [1] did not waive the attorney-client privilege by forwarding a confidential e-mail he received from his personal attorney to his sister-in-law because Dick inadvertently and unknowingly forwarded the e-mail from his iPhone, and therefore lacked the necessary intent to waive the privilege. The trial court also impliedly found that Dick's sister-in-law did not waive the privilege when she forwarded the e-mail to her husband, who then shared it with four other individuals, because neither Dick's sister-in-law nor his brother-in-law could waive Dick's attorney-client privilege, and Dick did not consent to these additional disclosures because he did not know about either his initial disclosure or these additional disclosures until a year after they occurred.

         In a separate order, the trial court disqualified Gibson, Dunn & Crutcher LLP (Gibson Dunn) from representing defendants and petitioners McDermott Will & Emery LLP and Jonathan C. Lurie (collectively, Defendants) in the underlying lawsuits because Gibson Dunn failed to recognize the potentially privileged nature of the e-mail after receiving a copy from Lurie, and then analyzed and used the e-mail despite Dick's objection that the e-mail was an inadvertently disclosed privileged document. The court explained Gibson Dunn had an ethical obligation to return the privileged material and refrain from using it under State Comp. Ins. Fund v. WPS, Inc. (1999) 70 Cal.App.4th 644 (State Fund). The court found Gibson Dunn's disqualification was necessary because there was a genuine likelihood Gibson Dunn's improper use of the e-mail would affect the outcome of the lawsuit, the integrity of the judicial proceedings, and the public's confidence in the proceedings.

         Defendants petition this court for a writ of mandate directing the trial court to vacate both its order finding Dick did not waive the attorney-client privilege as it applied to the e-mail, and its order disqualifying Gibson Dunn from representing Defendants in the underlying lawsuits. We deny the petition in its entirety. As we explain below, substantial evidence supports the trial court's orders and the court did not abuse its discretion in selecting disqualification as the appropriate remedy to address Gibson Dunn's violation of its State Fund duties.

         Contrary to Defendants' contention, an attorney's State Fund duties are not limited to inadvertently disclosed, privileged documents the attorney receives from opposing counsel, but also may apply to documents the attorney receives from the attorney's client. Indeed, regardless of how the attorney obtained the documents, whenever a reasonably competent attorney would conclude the documents obviously or clearly appear to be privileged and it is reasonably apparent they were inadvertently disclosed, the State Fund rule requires the attorney to review the documents no more than necessary to determine whether they are privileged, notify the privilege holder the attorney has documents that appear to be privileged, and refrain from using the documents until the parties or the court resolves any dispute about their privileged nature. The receiving attorney's reasonable belief the privilege holder waived the privilege or an exception to the privilege applies does not vitiate the attorney's State Fund duties. The trial court must determine whether the holder waived the privilege or an exception applies if the parties fail to reach an agreement. The receiving attorney assumes the risk of disqualification when that attorney elects to use the documents before the parties or the trial court has resolved the dispute over their privileged nature and the documents ultimately are found to be privileged.

         I

         Facts and Procedural History

         A. The Hausman Family, Defendants' Legal Representation, and the Dispute Over M. Hausman, Inc.

         Marilyn H. Hausman and her husband, Dick, had four children, Mary Jo, John, Teri, and Richard P. Hausman, Jr. (Rick). The primary source of the couple's considerable wealth was Marilyn's multi-million dollar investment portfolio. In 2000, Marilyn formed a holding corporation, M. Hausman, Inc. (MHI), to manage her portfolio. Marilyn was MHI's sole shareholder and director, and also served as its president. Dick served as the officer primarily responsible for making and managing MHI's investments, and joined Marilyn as a director in 2002. A few years later, Rick and William J. Cox also became directors of MHI. According to Dick, the value of MHI's portfolio grew to approximately $50 million under his management.

         In approximately 2002, Marilyn and Dick hired Defendants to provide a variety of estate planning services for their family. Over the years, Lurie formed several trusts and subtrusts for Marilyn and Dick, and the assets of those trusts included the shares in MHI. Dick, Rick, and Cox were appointed as cotrustees for many of these trusts, and the trust beneficiaries included the four Hausman children and Marilyn's mother. As part of their representation of the Hausman family, Defendants also represented MHI on corporate, employment, and other miscellaneous matters.

         Marilyn died in June 2008, and Dick succeeded her as MHI's president. Rick and Cox also became vice presidents at that time. Over the next several years, MHI continued to operate under the direction of Dick, Rick, and Cox, and Defendants continued to represent the members of the Hausman family and MHI.

         In 2013, Dick agreed to Rick's request to be named MHI's president so Rick could gain experience in managing MHI, but Dick continued to perform many of the president's essential functions. Soon after becoming president, Rick sought to dramatically increase his and Cox's salaries and other benefits, but Dick objected because he thought the substantial increases were not in MHI's best interests or the best interest of the various trust beneficiaries. A struggle for control of MHI ensued and Dick, Rick, and Cox engaged in protracted discussions attempting to resolve their dispute. To advise him in these discussions and about his options under the various trusts, Dick hired his own attorney, Mark Blaskey.

         On August 22, 2013, Dick, Rick, Cox, Blaskey, and Lurie met to discuss their disagreement. Immediately after that meeting, Dick, Blaskey, and Jill Lindsay met to review their options. Lindsay was MHI's employee and bookkeeper, but she also performed a variety of services for the various Hausman trusts and she was Dick's longtime personal assistant and advisor. Lindsay worked for Dick for nearly 40 years, starting as his executive secretary when he was an executive with Allergan and then working personally for him after he left the company. In her capacity as Dick's personal assistant, Lindsay regularly received and maintained correspondence on Dick's behalf.

         B. The Blaskey E-mail

         On August 27, 2013, Blaskey sent Dick a lengthy e-mail summarizing the August 22 meeting and providing legal advice to Dick about his options for resolving the dispute. Blaskey entitled the e-mail “Summary of 8/22/13 meeting, ” and copied Lindsay and his law partner, Alan Kessel. He copied Lindsay on the e-mail because she was responsible for maintaining Dick's correspondence. Lindsay replied to all recipients the same day.

         The following day Dick forwarded the Blaskey e-mail from his iPhone to “‘Mr. & Mrs. Gavin Shearer Herbert” at Ninetta Herbert's e-mail address. Dick's transmission did not include any additional text other than “Sent from my iPhone.” That same day Ninetta forwarded the e-mail to Gavin at his e-mail address. Gavin was Marilyn's brother and Dick's brother-in-law. Gavin had not been involved in the various Hausman trusts or MHI for many years, but he was attempting to act as an intermediary or informal mediator to resolve the dispute between Dick, Rick, and Cox. Gavin engaged in several discussions with these individuals and also Lurie and Blaskey about the dispute.

         Dick testified he did not intend to forward the Blaskey e-mail to Ninetta or Gavin, and did not know he had done so until the forwarded e-mail came to light approximately a year later. Dick was nearly 80 years old when he forwarded the e-mail and he explained multiple sclerosis had limited his physical dexterity. Gavin testified he did not recall receiving the Blaskey e-mail and he had not read it before it was shown to him at his deposition. He further testified that he had no idea why Dick would forward the e-mail to Ninetta, that doing so must have been a mistake, and that he never discussed the e-mail with Dick. Finally, Gavin testified he could not find a copy of the Blaskey e-mail when he was later asked to do so.

         On September 4, 2013, Rick, Cox, and Greg Pellizzon, a financial advisor who was working with MHI, met with Gavin to discuss the ongoing dispute. According to Rick and Pellizzon, Gavin passed out copies of the Blaskey e-mail at this meeting and described them as minutes from the August 22 meeting. Gavin testified he had no recollection of this. Pellizzon testified he read the e-mail during the meeting, but did not keep a copy. During this meeting, Gavin also phoned Lurie to discuss the dispute and later that day forwarded the Blaskey e-mail to Lurie, although Gavin testified he did not recall this. Lurie testified he had some discussions with Gavin about the e-mail's contents.

         C. The Probate Action

         Unable to resolve the dispute with Rick and Cox, Dick exercised a power he believed he held under the various trusts to reacquire all of MHI's voting shares and seize control of the company. Lurie, however, asserted Dick could no longer reacquire MHI's voting shares because Lurie had eliminated that option under the trusts' terms shortly after Marilyn's death. In October 2013, Dick filed a probate petition to confirm the actions he had taken to reacquire all MHI voting shares under the various Hausman family trusts (hereinafter, Probate Action).

         In August 2014, Rick's counsel in the Probate Action, Jason Kirby, discovered a copy of the Blaskey e-mail among Rick's documents as he prepared to respond to Dick's demand to produce documents. Kirby pulled the e-mail and separately sent it to Dick's counsel, Alan Kessel, with a letter explaining the e-mail appeared to be a privileged communication between Blaskey and Dick, but that Dick later waived the privilege by forwarding it to Ninetta and Gavin. The letter further explained that Rick obtained a copy of the e-mail when Gavin handed it out at the September 4, 2013 meeting involving Rick, Cox, Pellizzon, and Gavin. Kirby asked whether Dick's counsel would claim the Blaskey e-mail still was privileged, and if so, for authority supporting that contention. Finally, Kirby assured Dick's counsel he had not used or disclosed the contents of the e-mail. This letter was the first time Dick and his attorney learned the Blaskey e-mail had been forwarded to anyone other than the original recipients, and they did not yet know the e-mail also had been forwarded to Lurie.

         Dick's attorney, Kessel, responded that the Blaskey e-mail was a privileged attorney-client communication, and that Dick inadvertently disclosed the e-mail to Ninetta without intending to waive the privilege. Dick's counsel explained that Dick rarely communicated with Ninetta and never talked to her about MHI affairs, and therefore he inadvertently forwarded the e-mail to Ninetta when he was trying to forward it to Lindsay. Based on State Fund and Rico v. Mitsubishi Motors Corp. (2007) 42 Cal.4th 807 (Rico), Dick's counsel argued Kirby had an ethical obligation to return the inadvertently disclosed e-mail and destroy any copies. Dick's counsel also asked Kirby to contact any other party he knew had received a copy of the Blaskey e-mail, including Ninetta, Gavin, and Pellizzon, and direct them to destroy their copies.

         Kirby argued neither Rico nor State Fund applied because those cases did not involve a client waiving the privilege by disclosing a communication to third parties before any litigation arose. Nonetheless, Kirby agreed to destroy all copies of the Blaskey e-mail except one, to seal that copy, and only use the copy to resolve the parties' dispute over whether Dick had waived the attorney-client privilege. Kirby also promised not to question anyone about the e-mail's content until the parties resolved the waiver issue. Finally, Kirby asserted he had no obligation to ask third parties to return the Blaskey e-mail. All parties to the Probate Action honored this agreement for several months.

         In late July 2015, Defendants produced several thousand pages of documents in the Probate Action based on Dick's subpoena, and that production included a copy of the Blaskey e-mail that Gavin had forwarded to Lurie in September 2013. On August 13, 2015, the parties deposed Lurie in the Probate Action, and James Fogelman of Gibson Dunn represented Lurie in the deposition. When Rick's counsel questioned Lurie about the copy of the Blaskey e-mail that was included in Defendants' document production, Dick's attorney, Paul George, immediately objected that the e-mail was privileged and should not be used in the deposition. George also explained that Dick's other attorney, Kessel, had asked Rick's counsel to return all copies of the e-mail. This was the first time Dick and his counsel learned the Blaskey e-mail had been forwarded to Lurie.

         Fogelman claimed the Blaskey e-mail was not privileged and asserted neither he nor Defendants had ever been asked to return it. To remove any doubt, Dick's counsel therefore requested that Fogelman and his clients return all copies of the Blaskey e-mail because Dick inadvertently disclosed the privileged communication and all attorneys, including Lurie, had an ethical obligation to return or destroy inadvertently disclosed, privileged communications. Fogelman refused to return or destroy the Blaskey e-mail, disputing it was privileged because Dick had disclosed it to third parties, including Ninetta, Gavin, and Lindsay. Fogelman claimed an attorney's ethical obligation to return inadvertently disclosed documents only applied to documents that were inadvertently produced during discovery. Dick's counsel disagreed and the deposition continued. Lurie testified he reviewed the e-mail to refresh his recollection before the deposition, but he did not specifically testify about the e-mail's content.

         D. The Malpractice Actions

         In May 2015, Plaintiffs filed two malpractice lawsuits against Defendants based on an alleged conflict in representing various members of the Hausman family, the Hausman family trusts, and MHI (collectively, Malpractice Actions). They brought one suit in their individual capacities and as trustees under certain Hausman family trusts. They brought the second lawsuit as a derivative action on MHI's behalf. Dick has different counsel in the Malpractice Actions than he had in the Probate Action, and Defendants are represented in the Malpractice Actions by Fogelman and Gibson Dunn.

         On August 19, 2015, less than a week after Lurie's deposition in the Probate Action, Gibson Dunn deposed Lindsay in the Malpractice Actions. Lindsay testified she worked for MHI, the Hausman family trusts, and Dick personally at the time she received the Blaskey e-mail.

         Five days later, Gibson Dunn deposed Mary Jo in the Malpractice Actions. Fogelman marked the Blaskey e-mail as an exhibit, sought to question Mary Jo about it, and read substantial portions of it into the record. Dick's attorney, Suzanne Burke Spencer, explained she was not familiar with the document or how it was produced, but she asserted it was a privileged, attorney-client communication that appeared to have been produced inadvertently and she requested that Fogelman return all copies. He disputed that the e-mail was privileged or that either Lurie or Gibson Dunn had an obligation to return the e-mail because Dick had disclosed it voluntarily to various third parties. Spencer maintained her privilege objection and demand for the return of the e-mail, but stated she would allow questions about the e-mail subject to a motion to strike once she learned the circumstances surrounding the communication and its disclosure. Fogelman failed to inform Spencer that Dick's attorney in the Probate Action had raised the same objections less than two weeks earlier at Lurie's deposition in that separate lawsuit, nor did he inform her of the agreement the parties in that lawsuit reached about the e-mail. The following day, Gibson Dunn deposed Teri in the Malpractice Actions with Fogelman and Spencer engaging in essentially the same exchange. On August 24, 2015, Fogelman also quoted the Blaskey e-mail in interrogatory responses he served on Defendants' behalf.

         On September 4, 2015, Spencer wrote Fogelman to explain the Blaskey e-mail remained a privileged communication between Dick and Blaskey. Spencer explained Lindsay's inclusion on the e-mail did not destroy the privilege because she received it as Dick's personal assistant, Dick's inadvertent disclosure of the e-mail did not waive the privilege because he did not intend to disclose the e-mail to Ninetta or anyone else, and the disclosure of the e-mail by various third parties was done without Dick's consent. Spencer further explained that Rick's counsel in the Probate Action recognized the privileged nature of the Blaskey e-mail and brought it to the attention of Dick's counsel even though Rick's counsel also asserted the privilege had been waived. The attorneys in the Probate Action then agreed to preserve the e-mail's privileged status while they attempted to resolve the dispute over whether Dick waived the privilege. Spencer also asserted Fogelman knew Dick had claimed the e-mail was privileged and demanded its return because Fogelman had attended Lurie's deposition in the Probate Action, but Fogelman nonetheless used the e-mail at Mary Jo's and Teri's depositions in the Malpractice Actions without informing her about those objections. Finally, based on Rico and State Fund, Spencer asserted Fogelman had an ethical obligation to return or destroy all copies of the Blaskey e-mail and she demanded that he do so immediately.

         After receiving Spencer's letter, Fogelman agreed that Gibson Dunn would temporarily stop using the Blaskey e-mail while the parties conducted discovery about the circumstances surrounding the e-mail and its disclosure. Nonetheless, Gibson Dunn produced a copy of the Blaskey e-mail as part of a larger document production in the Malpractice Actions on September 14, 2015.

         During September and October 2015, Spencer conducted discovery about the Blaskey e-mail, but asserted additional discovery was still required on the waiver issue, including Lurie's deposition. In mid-November 2015, Fogelman wrote Spencer claiming Dick had been given sufficient time to explore the circumstances surrounding the e-mail and its disclosure, and none of the information uncovered established the Blaskey e-mail was a privileged communication. Fogelman therefore announced Gibson Dunn would resume using the e-mail.

         E. The Privilege and Disqualification Motions

         In early December 2015, Dick filed a motion in the Malpractice Actions seeking (1) a judicial determination that the Blaskey e-mail was a privileged attorney-client communication that Dick inadvertently disclosed, and (2) an order requiring Gibson Dunn to return all copies of the e-mail and striking those portions of Mary Jo's and Teri's depositions where Fogelman asked questions about the e-mail and read portions of it into the record. Defendants opposed the motion, arguing the Blaskey e-mail never was privileged based on Lindsay's inclusion as an original recipient, and Dick nonetheless waived the attorney-client privilege by disclosing the e-mail to third parties. In support, Defendants filed a copy of the Blaskey e-mail under seal. In March 2016, the trial court granted Dick's motion, and ordered Defendants to seal or return all copies of the Blaskey e-mail and seal the relevant portions of Mary Jo's and Teri's deposition transcripts. Dick served notice of entry of the order on March 15, 2016.[2]

         Less than two weeks later, Dick filed a motion to disqualify Gibson Dunn from representing Defendants in the Malpractice Actions based on its use of the Blaskey e-mail and its refusal to return it. Gibson Dunn opposed the motion, arguing it was not readily apparent from the face of the e-mail that it was an inadvertently disclosed, privileged document. Gibson Dunn further argued its disqualification was not warranted because there was no evidence its review and initial failure to return the e-mail would substantially impact the litigation. On May 25, 2016, the trial court granted Dick's motion and disqualified Gibson Dunn from representing Defendants in the Malpractice Actions. The court stayed its ruling for 30 days to allow Defendants to petition this court for relief.

         On June 6, 2016, Defendants filed this writ petition seeking a writ of mandate compelling the trial court to vacate (1) its order deeming the Blaskey e-mail privileged, and (2) its order disqualifying Gibson Dunn as Defendants' counsel in the Malpractice Actions. Defendants also sought a stay of all trial court proceedings pending the resolution of this writ petition. We granted the stay request and issued an order to show cause why a writ of mandate should not issue.

         II

         Discussion

         A. The Blaskey E-mail Was a Privileged Attorney-Client Communication and Dick Did Not Waive the Privilege

         1. We May Review the Trial Court's Privilege Ruling Because It Is Inextricably Intertwined with the Disqualification Ruling

         Dick contends we should deny Defendants' challenge to the trial court's ruling that the Blaskey e-mail is privileged because Defendants filed their writ petition more than 60 days after Dick served notice of that ruling. Despite the timing, we will consider Defendants' arguments challenging the privilege ruling on the merits because it is inextricably intertwined with the disqualification ruling and Dick fails to show any prejudice.

         Although there is no statutory time limit on a common law writ petition, appellate courts generally apply the same 60-day time limit applicable to appeals. But unlike appeals, appellate courts have discretion to decide a writ petition filed after the 60-day period, and typically look to whether there is any prejudice to the opposing party in doing so. (People v. Superior Court (Lopez) (2005) 125 Cal.App.4th 1558, 1562-1563.) Here, Dick fails to identify how deciding Defendants' challenge to the privilege ruling will prejudice him.

         More importantly, when deciding a timely writ petition challenging a trial court ruling, an appellate court also may review an unchallenged earlier ruling if it is inextricably intertwined with the issues presented on the writ petition. (Travelers Property Casualty Co. of America v. Superior Court (2013) 215 Cal.App.4th 561, 573, fn. 17.) Here, the question whether the Blaskey e-mail was privileged is a “predicate issue[]” we must resolve before determining whether the trial court erred in disqualifying Gibson Dunn for reviewing and using the e-mail. (State Fund, supra, 70 Cal.App.4th at p. 651.) We therefore must resolve the privilege question on the merits.

         2. Legal Principles Governing the Attorney-Client Privilege

         The attorney-client privilege is a legislative creation, which courts have no power to expand or limit by implying exceptions. (Costco Wholesale Corp. v. Superior Court (2009) 47 Cal.4th 725, 739 (Costco); McKesson HBOC, Inc. v. Superior Court (2004) 115 Cal.App.4th 1229, 1236.) Based on the privilege, a client may refuse to disclose, and may prevent others from disclosing, confidential communications between a client and his or her attorney. (Evid. Code, § 954.)

         A “‘confidential communication between client and lawyer'” is statutorily defined as “information transmitted between a client and his or her lawyer in the course of that relationship and in confidence by a means which, so far as the client is aware, discloses the information to no third persons other than those who are present to further the interest of the client in the consultation or those to whom disclosure is reasonably necessary for the transmission of the information or the accomplishment of the purpose for which the lawyer is consulted, and includes a legal opinion formed and the advice given by the lawyer in the course of that relationship.” (Evid. Code, § 952.)

         “Once the proponent makes a prima facie showing of a confidential attorney-client communication, it is presumed the communication is privileged and the burden shifts to the opponent to establish waiver, an exception, or that the privilege does not for some other reason apply.” (DP Pham, LLC v. Cheadle (2016) 246 Cal.App.4th 653, 659-660 (Pham); see Evid. Code, § 917, subd. (a); Costco, supra, 47 Cal.4th at p. 733.)

         The attorney-client privilege may be waived, but only by the holder of the privilege. (Pham, supra, 246 Cal.App.4th at p. 668.) A waiver results when the holder, without coercion, (1) has disclosed a significant part of the communication, or (2) has consented to the disclosure made by anyone else. (Evid. Code, § 912, subd. (a); State Fund, supra, 70 Cal.App.4th at p. 652.) Under the second method of waiver, “Consent to disclosure is manifested by any statement or other conduct of the holder of the privilege indicating consent to the disclosure, including failure to claim the privilege in any proceeding in which the holder has legal standing and the opportunity to claim the privilege.” (Evid. Code, § 912, subd. (a).)

         “Despite the statute's declaration that any uncoerced ‘disclosure' creates a waiver, courts have consistently held that inadvertent disclosures do not.” (Newark Unified School Dist. v. Superior Court (2015) 245 Cal.App.4th 887, 900 (Newark).) As the Supreme Court explains, “the disclosure contemplated in Evidence Code section 912 involves some measure of choice and deliberation on the part of the privilege holder.” (Ardon v. City of Los Angeles (2016) 62 Cal.4th 1176, 1188 (Ardon); see id. at p. 1189 [Evid. Code § 912, subd. (a), requires “a voluntary and knowing disclosure” to waive privilege].) Similarly, in State Fund, the Court of Appeal concluded a waiver of the attorney-client privilege occurs only when there is an “intention to voluntarily relinquish a known right.” (State Fund, supra, 70 Cal.App.4th at p. 653; see Newark, at p. 900 [State Fund “read into the statute the requirement that a disclosure be ‘[]intentional, ' notwithstanding the failure of section 912 to distinguish between intentional and inadvertent disclosures.... This is consistent with the long-standing principle that a privilege is not waived in the absence of a manifest intent to waive”].)

         The privilege holder's characterization of his or her intent in disclosing a privileged communication is an important consideration in determining whether the holder waived the privilege, but is not necessarily dispositive. (Ardon, supra, 62 Cal.4th at pp. 1190-1191.) When determining whether an inadvertent disclosure waived the attorney-client privilege, a trial court must examine both the subjective intent of the privilege holder and any manifestation of the holder's intent to disclose the information. (Ibid.; State Fund, supra, 70 Cal.App.4th at pp. 652-653.) Other relevant considerations include the precautions the holder took to ensure the privilege was maintained and the promptness with which the holder sought return of the inadvertently disclosed document. (Ardon, at p. 1191; State Fund, at p. 653.)

         “‘“When the facts, or reasonable inferences from the facts, shown in support of or in opposition to the claim of privilege are in conflict, the determination of whether the evidence supports one conclusion or the other is for the trial court, and a reviewing court may not disturb such finding if there is any substantial evidence to support it.”'” (Pham, supra, 246 Cal.App.4th at p. 664; see Kerner v. Superior Court (2012) 206 Cal.App.4th 84, 110.) Defendants contend we should employ the de novo standard in reviewing the trial court's ruling because the facts are undisputed, and whether Dick waived the attorney-client privilege is therefore strictly a question of law. (See generally Ghirardo v. Antonioli (1994) 8 Cal.4th 791, 799.) Not so.

         As explained below, there is conflicting evidence on whether Dick intended to waive the attorney-client privilege and competing inferences also may be drawn from the evidence. Substantial evidence is therefore the controlling standard of review. (Eisenberg et al., Cal. Practice Guide: Civil Appeals and Writs (The Rutter Group 2016) ¶ 8:60, p. 8-29 (Eisenberg, Civil Appeals and Writs) [“Even if the facts were admitted or uncontradicted, the appellate court will not substitute its deductions for the reasonable inferences actually or presumptively drawn by the trial court”]; see Escobar v. Flores (2010) 183 Cal.App.4th 737, 752 (Escobar); Milton v. Perceptual Development Corp. (1997) 53 Cal.App.4th 861, 867 (Milton).)

         3. Substantial Evidence Supports the Trial Court's Privilege Ruling

         Defendants do not dispute the Blaskey e-mail was a privileged attorney-client communication, but contend the trial court erred “as a matter of law” in determining Dick did not waive the privilege. They argue the court “treat[ed] Dick's own post-hoc characterization of his intent as dispositive, while ignoring (or declining to consider) the objective, contemporaneous evidence of Dick's intent.” Defendants mischaracterize the trial court's ruling and ignore the substantial evidence supporting the court's conclusion Dick did not waive the privilege.

         The trial court concluded Dick did not waive the attorney-client privilege because “[t]here is no basis to find intentional waiver.” In support, the court cited Dick's “unequivocal[]” testimony that he did not intend to forward the Blaskey e-mail to Ninetta, and he did not know how it happened. The court also noted the privilege was not waived by Dick's failure to request that Gavin and Pellizzon return the e-mail or to ask Defendants to return copies of the e-mail they produced in discovery. Finally, the court pointed out the “scenario” this case presented did not fit any of the recognized means for waiving the privilege.

         Nothing in the trial court's ruling suggests the court failed to consider all the evidence in reaching its decision, and Defendants do not cite anything in the record to support their contrary contention. We presume the trial court knew and properly applied the law absent evidence to the contrary. (Harris v. Stampolis (2016) 248 ...


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