Federal Judge Protects Litigation Funding Information From Disclosure
A federal district court judge in Chicago federal judge has refused to compel an antitrust plaintiff to disclose its litigation funding arrangements. This decision is further support for the argument that litigation funding arrangements should be routinely disclosed. In addition, the decision supports the proposition that disclosure of confidential materials to a litigation funder does not waive the attorney-client and/or work-product privileges.
The decision came in a case concerning “interconnects” – cooperative platforms set up by cable service providers, which allowed local advertisers to buy ad time across “particular Designated Media Markets.” Viamedia alleged that Comcast acted to eliminate competition for “spot advertising” on the interconnects in the Chicago and Detroit areas, ordering other cable TV service providers, to only sell spot cable ads through Comcast’s wholly owned subsidiary, Comcast Spotlight. According to the complaint, this action cut Viamedia out of the markets in which it had long competed.
Comcast filed a motion to compel seeking certain documents that Viamedia had claimed as privileged. In the motion, Comcast asserted that Viamedia may have sought funding help from third-party litigation financing firms and may have disclosed confidential documents to those financiers. In addition, Comcast noted that Viamedia had disclosed some documents to the Justice Department in an effort to prompt government enforcement proceedings. Comcast argued that this disclosure waived any privilege in these documents. Viamedia, however, argued all of the documents should remain protected by legal privilege, as the responded by arguing that the documents were all prepared and shared only in anticipation of legal action, and any prior disclosure was “inadvertent.”
On June 30, U.S. District Judge Amy J. St. Eve denied Comcast’s motion. Although her decision declined to address whether the documents should be protected by attorney-client privilege, she held the documents should remain protected under the work-product doctrine, which protects from disclosure certain materials prepared in anticipation of filing a lawsuit. In this connection, she rejected Comcast’s arguments that privileges could not apply because they were disclosed in a lobbying effort to instigate a regulatory action, not a lawsuit.
The decision is consistent with the idea that seeking litigation funding is part of the litigation process and that funding companies are not really in the position of third parties to the litigation. Therefore, disclosing information to a funder for the purpose of obtaining funding is akin to sharing information with an expert or a consulting law firm that might be assisting in the representation. In short, the decision is another step in developing the recognition that litigation finance is normal part of the litigation process.
Topics: litigation finance, legal reform, third-party funding, litigation costs, disclosure, discovery, Comcast
Works Cited: Jonathan Bilyk, Judge Won’t Force Viamedia to Share Documents on Litigation Funding, DOJ Action vs Comcast, Cook County Record (July 7, 2017) available at http://cookcountyrecord.com/stories/511145298-judge-won-t-force-viamedia-to-share-documents-on-litigation-funding-doj-action-vs-comcast
