London Luxury LLC v. Walmart Inc.

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IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
FAYETTEVILLE DIVISION
LONDON LUXURY, LLC 	PLAINTIFF/COUNTER-DEFENDANT
V. 	CASE NO. 5:22-CV-5059
WALMART, INC. 	DEFENDANT/COUNTER-PLAINTIFF
FOURTH ORDER REGARDING WALMART’S PRIVILEGE LOG
This is the Court’s Fourth Order to address a series of related discovery disputes
over Walmart’s privilege log. See Docs. 398, 405, and 408. 	Among other things,
Walmart asserted privilege over communications and investigative materials prepared
with/by its attorney-investigator employees on Walmart’s Global Investigations team. 	In
its 	Second 	Order 	in 	this 	series, 	the 	Court 	addressed 	Walmart’s 	withholding 	of
investigative work product and interview summaries, stating that it was:
. . . convinced by its in camera review that the GI Report was prepared in
anticipation of litigation and constitutes attorney work product protected Fed. R.
Civ. Proc. 26(b)(3)(A). 	The timeline shows that the investigation began when a
$500 million transaction was in the final stages of failing. The investigation was still
on-going when London Luxury filed suit. 	The investigation was led by Walmart’s
attorney-investigators. The GI Report is replete with attorney mental impressions,
conclusions, and opinions.
Doc. 405, p. 6 (footnote omitted).
Now, 	the 	Court 	takes 	up 	Walmart’s 	assertion 	of 	privilege 	over 	written
communications exchanged during the internal investigation by and between Global
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Investigations, 1 	Walmart’s 	in-house 	attorney 	employees, 	and 	Walmart’s 	business
employees. The communications at issue relate to the nitrile glove transactions in
question. For factual context, the Court incorporates by reference and refers the reader
to the background section of its Summary Judgment Opinion and Order filed on March
8th. Doc. 399.
Based on the Court’s in camera review, it appears that Walmart’s internal
investigators began collecting information in October 2021. Unlike the investigative report
that Walmart withheld in its entirety, 	Walmart has only redacted portions of its
communications with counsel or their investigators in anticipation of litigation. 	London
Luxury 	contends 	that 	any 	privilege 	has 	been 	waived 	because 	the 	redacted
communications go to Walmart’s business interests and factual claims and defenses.
London Luxury also asserts that a waiver occurs where a Walmart attorney involved in
the communication has been listed by Walmart as a trial witness (e.g. Vicki Vasser, see
Doc. 398, pp. 3-5).
In this attorney-client and work product privilege dispute, Walmart is the client who
owns the privilege. Walmart is asserting privilege over communications that its business
employees had with its attorney employees and internal investigators. Under Federal
Rule of Evidence 501, when parties are litigating state law claims, state law defines the
elements of attorney-client privilege. Arkansas Rule of Evidence 502 provides the basic
1 . The Global Investigations team includes Walmart attorney-investigators and non-
attorney investigators. In some instances, the communications at issue may involve non-
lawyer investigators, but whose work was nevertheless directed and supervised by
attorneys on Walmart’s Global Investigations team.
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rule in Arkansas:
A client has a privilege to refuse to disclose and to prevent any other
person from disclosing confidential communications made for the purpose
of facilitating the rendition of professional legal services to the client (1)
between himself or his representative and his lawyer or his lawyer's
representative, (2) between his lawyer and the lawyer's representative, (3)
by him or his representative or his lawyer or a representative of the lawyer
to a lawyer or a representative of a lawyer representing another party in a
pending action and concerning a matter of common interest therein, (4)
between 	representatives 	of 	the 	client 	or 	between 	the 	client 	and 	a
representative of the client, or (5) among lawyers and their representatives
representing the same client.
Further, when evaluating whether a client’s employee’s communications with an
attorney should be shielded from production due to attorney-client privilege, the following
five factors are considered:
(1) whether the communication was made for the purpose of securing legal
advice; (2) whether the employee making the communication did so at the
direction of his corporate superior; (3) whether the superior made the
request so that the corporation could secure legal advice; (4) whether the
subject matter of the communication is within the scope of the employee's
corporate duties; and (5) whether the communication is not disseminated
beyond those persons who, because of the corporate structure, need to
know its contents.
Diversified Indus., Inc. v. Meredith, 572 F.2d 596, 609 (8th Cir. 1977).
Another guiding principle is that “the attorney-client privilege cannot at once be used
as a shield and a sword.” United States v. Bilzerian, 926 F.2d 1285, 1292 (2nd Cir.), cert.
denied, 112 S. Ct. 63 (1991). Because “[a] defendant may not use the privilege to
prejudice his opponent's case . . . the privilege may implicitly be waived when [the]
defendant 	asserts 	a 	claim 	that 	in 	fairness 	requires 	examination 	of 	protected
communication.” Id.
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Finally, Federal Rule of Civil Procedure 26(b)(3) speaks to documents that may be
withheld when prepared during or in anticipation of litigation.
(A) Documents 	and 	Tangible 	Things. Ordinarily, 	a 	party 	may 	not 	discover
documents and tangible things that are prepared in anticipation of litigation or for
trial by or for another party or its representative (including the other party's
attorney, consultant, surety, indemnitor, insurer, or agent). But, subject to Rule
26(b)(4), those materials may be discovered if:
(i) they are otherwise discoverable under Rule 26(b)(1); and
(ii) the party shows that it has substantial need for the materials to prepare
its case and cannot, without undue hardship, obtain their substantial
equivalent by other means.
(B) Protection Against Disclosure. If the court orders discovery of those materials,
it must protect against disclosure of the mental impressions, conclusions, opinions,
or legal theories of a party's attorney or other representative concerning the
litigation.
(C) Previous Statement. Any party or other person may, on request and without
the required showing, obtain the person's own previous statement about the action
or its subject matter. If the request is refused, the person may move for a court
order, and Rule 37(a)(5) applies to the award of expenses. A previous statement
is either:
(i) a written statement that the person has signed or otherwise adopted or
approved; or
(ii) 	a 	contemporaneous 	stenographic, 	mechanical, 	electrical, 	or 	other
recording—or a transcription of it—that recites substantially verbatim the
person's oral statement
The Court applied these legal standards to its in camera review of the disputed
communications. The bates-stamped lists of documents to which this Order applies are
attached as Exhibits 1 and 2.
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Based on the Court’s review, Global Investigation’s attorneys and investigators began
collecting documents and communicating with key business employees and department
attorneys in mid-to-late October 2021. London Luxury contends this timeline shows the
internal investigation was not in anticipation of litigation, but rather “for a business purpose
to avoid repeating the business mistakes that its businesspersons made, and it is clear
would have been undertaken regardless of the prospect of litigation with London Luxury.”
Doc. 210, p. 13. The Court disagrees.
First, Walmart has previously produced the substantive business content of these
communications and only 	partially 	redacted 	the email 	strings at 	issue here. 	The
redactions consist mostly of cover emails by a Walmart management executive or an in-
house 	attorney 	forwarding 	email 	strings 	(that 	had 	been 	collected 	from 	business
employees who had participated in the nitrile glove transactions). 	Importantly, Walmart
has not redacted the substantive email strings being forwarded. 	Second, in the
instances where a Walmart management employee or in-house attorney might have
included a capsule summary for the recipient attorney’s or investigator’s benefit (or, in
one instance, a longer substantive discussion), the Court finds the redacted comments to
be for a confidential legal purpose and/or made in anticipation of litigation. In other words,
the redacted portions meet the privilege criteria in Ark. R. Evid. 502, and the Court does
not believe that any principle of fairness compels disclosure. United States v. Bilzerian,
926 F.2d at 1292. 	For these reasons, Walmart is not required to produce any of the
documents listed on Exhibit 1.
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There is one exception to the communications in this category. 	Bates-stamped
document WM-LL0087733 is a 5-page document (including the cover page) that appears
to be an instant message thread between business employees Elizabeth Doss and Coryn
Kremers. 	Although the two speak about legal advice previously shared by a Walmart
attorney in another matter, no attorney or investigator was a party to the communications.
This communication between two non-lawyers is not privileged. 	To the extent the legal
advice was privileged when originally imparted by a lawyer, the privilege was waived
when the advice was repeated beyond the scope of persons needing to know the advice
within the context in which it was given. 	Diversified Indus., Inc. v. Meredith, 572 F.2d at
609. (“[T]the communication [must] not [be] disseminated beyond those persons who,
because of the corporate structure, need to know its contents).
For these reasons, Walmart must produce the document (including the cover
page) listed on Exhibit 2 by not later than 10am CST on March 19, 2024. London
Luxury must treat the document as confidential and subject to the Court’s protective
Order. 	Moreover, just because the document is discoverable, does not necessarily
mean it is admissible in evidence.
IT IS SO ORDERED on this 18 th day of March 2024.
TIMOTHY L. BROOKS
UNITED STATES DISTRICT JUDGE
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