Judge limits VFW attorney-client privilege in land case

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The attorneys for the state’s Veterans of Foreign Wars can no longer rely on the attorney-client privilege to avoid producing 10 months’ worth of communications between its original counsel and the attorney it came to share with a large real estate developer that had long been the hidden hand behind a suit over a South Boston parcel the developer has desired for years, a Superior Court judge has ruled.

Back in 2021, the Department of Massachusetts VFW sued two LLCs sharing the same South Boston business address, alleging that they conspired to first commandeer the operations and then, in 2012, to acquire for the nominal price of $10 the home base of South Boston VFW Post No. 6536 on Ellery Street.

The real estate transfer violated national VFW bylaws, which the post was required to follow, the VFW-MA claims.

The VFW-MA then alleges the defendants conspired to conceal the transfer for another six years by falsifying information in reports the post was required to submit to the state organization.

But defendants Donovan Properties LLC and Andrew Square LLC maintain that the property transfer adhered to those bylaws. What’s going on now, they say, is a desperate attempt by developer Core Investments to get its hands on a property it has been eyeing since 2017.

Core is in the middle of a “massive” redevelopment project known as the “On the Dot” project near the Andrew Square MBTA train and bus station, and the Ellery Street parcel serves as a “critical access point” to that project, the defendants say, thus the effort to enlist the VFW-MA to unwind what had been a legitimate transfer.

Probing the relationship between VFW-MA and Core has been a focus of the defendants’ discovery efforts, which VFW-MA initially resisted based on relevancy, attorney-client privilege, joint common defense, the common interest doctrine, and the First Amendment.

When VFW-MA began its lawsuit, it was represented by attorneys from the Westwood firm of Valerio, Dominello & Hillman, including Robert D. Hillman. But after the defendants got a judge to grant a motion to compel, VFW-MA produced a “joint and common defense, privilege and confidentiality agreement” signed on Nov. 18, 2021, which granted Core and its counsel from Bernkopf Goodman the right to control, prosecute and fund VFW-MA’s lawsuit, along with the right to purchase the Ellery Street property. A privilege log showed that attorneys from Valerio Dominello and Bernkopf were corresponding by email in the weeks after the agreement was signed.

In April 2024, the defendants filed a renewed motion to compel, and a judge ordered VFW-MA to produce “without delay” all communications and documents exchanged between its representatives and Core’s.

However, VFW-MA continued to withhold several identified communications, citing the attorney-client privilege.

Core and VFW-MA then entered a “conflict waiver” agreement on May 2, 2024. Not long thereafter, Jason Manekas of Bernkopf Goodman entered an appearance on behalf of VFW-MA in the litigation with the two LLCs.

The VFW-MA continued to fight the disclosure of communications between the Bernkopf and Valerio Dominello attorneys from the period after the purchase agreement and the start of litigation, but its motion for partial reconsideration of the discovery order and a petition to a single justice failed.

Last September, the defendants filed a motion for sanctions on VFW-MA, which VFW-MA opposed. VFW-MA produced more than 5,550 pages of communications and documents between Bernkopf and Valerio Dominello but continued to hold tight to communications from August 2023 to June 2024 on the basis that they were privileged.

In a sur-reply to the sanctions motion, VFW-MA claimed for the first time that although the conflict waiver agreement was dated May 2, 2024, Bernkopf had begun to represent it “no later than August 23, 2023.”

VFW-MA had made a “strategic decision” to delay Bernkopf’s formal appearance in the case until the motion to compel was resolved, it explained.

On April 29, Judge Michael D. Ricciuti decided that sanctions were warranted. But he declined to impose the drastic one the defendants had suggested: dismissal.

Ricciuti noted that not only had VFW-MA failed to comply with the order to produce all the communications, it failed to support its privilege theory until the 11th hour.

“The Court infers that Plaintiffs did so to at least deemphasize, if not conceal, the nature of the relationship between Core and VFW-MA, exactly the issue on which the Court had ordered discovery,” Ricciuti wrote.

Still, the argument that VFW-MA’s attorney-client relationship predated the conflict waiver agreement “has some legal and factual support,” Ricciuti allowed.

He pointed to the Supreme Judicial Court’s 2018 decision in Patel v. Martin in support of the proposition that a party may have an attorney-client relationship and benefit from the privilege even before it provides the written consent required under Rule 1.7(b) of the Rules of Professional Conduct.

Dismissal was also not warranted because VFW-MA had previously disclosed the conflict waiver agreement and because its “unjustified non-compliance occurred over a relatively short time frame.”

Instead, Ricciuti granted the defendants “expanded access” to the information withheld by VFW-MA. He ordered “complete compliance” with Judge Adam L. Sisitsky’s May 30, 2024, discovery order, while also prohibiting VFW-MA from objecting to any current or future discovery request based on attorney-client privilege between VFW-MA and Bernkopf prior to the effective date of the conflict waiver agreement, June 3, 2024.

Ricciuti also ordered VFW-MA to pay the attorneys’ fees and costs the defendants incurred with its efforts to enforce Sisitsky’s order since July 29, 2024, when the court had rejected its previous requests for counsel fees.

Manekas declines to comment, citing the ongoing nature of the litigation.

The defendants’ attorneys — Edmund A. Allcock of Allcock & Marcus in Braintree, and Bruce E. Falby, Paul B. Lewis and Irina V. Rudenko, of DLA Piper in Boston — had not responded to requests for comment as of Lawyers Weekly’s press time.

But Boston attorney Michael J. Rossi, who regularly defends attorneys and other professionals in malpractice actions and disciplinary proceedings, calls the court’s sanction “significant.”

“Though not as harsh as a dismissal, it amounts to a judicially imposed waiver of the attorney-client privilege, one of the most sacrosanct concepts of law,” he says.

Now that the court has prohibited the plaintiffs from asserting the privilege as an objection to requests for attorney-client communications, there is a potential confidentiality issue, Rossi adds.

“The now-discoverable communications could include sensitive or proprietary information on topics unrelated to the issue on which the court ordered discovery,” he says.

One option to balance those concerns would have been to impose some limitation on the production of documents — for example, ordering production on an attorneys-eyes-only basis, and requiring defense counsel to obtain the plaintiffs’ consent or a court order if counsel wished to further disclose them, the Conn, Kavanaugh, Rosenthal, Peisch & Ford partner says.

The VFW case also offers a reminder that privilege logs are not optional, and many problems could be avoided by erring on the side of inclusion, Rossi says. In complex cases, it may not be practical or required to log each individual attorney-client communication, but at least identifying a date range of communications for which the privilege is claimed is important, he says.