UNITED STATES v. BRANCATELLI (2024)

ORDER

In this matter, the United States seeks to foreclose property to satisfy a judgment it has against Defendant Frank R. Brancatelli. The property is allegedly owned by Defendant Linda Brancatelli, but the Government believes that it can show that she “holds the Property as the nominee, fraudulent transferee, or agent of Frank R. Brancatelli.” Doc. 1, at 6.

 Background

Currently before the Court is another in a series of discovery disputes in this matter. Previously, the United States sought a protective order after the Brancatellis issued a notice to take a deposition under Federal Rule of Civil Procedure 30(b)(6).¹ See Doc. 42. The Government claimed that the Brancatellis sought evidence that was protected by the work-product and other privileges. Id. at 2. Following a briefing order, the Brancatellis filed a response which mostly focused on irrelevant matters. See Doc. 43, at 2–7. Near the end of the response, however, the Brancatellis asserted that they:

have the right, through discovery, to determine what evidence the United States intends to submit at the trial in this matter to establish that Defendant Linda S Brancatelli is a nominee, fraudulent transferee or agent of Defendant Frank R Brancatelli and that he has an interest in the property for the liens to attach.

Defendant Frank R. Brancatelli does not consider that information privileged.

Id. at 7.

The Court held a video conference with the parties on June 12, 2024. In light of the Government's work-product concerns and the Brancatellis’ assertion that they merely want the evidence that the Government will present, the Court suggested that the use of contention interrogatories might resolve the parties’ disagreement.² See Doc. 49, at 3 (discussing the June 12, 2024 conference); see also SEC v. McGinnis, No. 14-cv-6, 2015 WL 13505396, at *7 (D. Vt. Jan. 13, 2015) (“the court concludes that contention interrogatories asking for those same facts constitute a less burdensome and more convenient substitute for a Rule 30(b)(6) deposition on the same subject matter”); SEC v. Morelli, 143 F.R.D. 42, 48 (S.D.N.Y. 1992) (“in circumstances similar to the case at bar, the use of contention interrogatories has been authorized in the face of work product objections”) (citing cases). The parties agreed. Doc. 49, at 3.

This agreement was short-lived.

The Government soon filed a new notice of a discovery dispute, again seeking a protective order. Doc. 45. The Court thus ordered additional briefing. Doc. 46.

The parties’ briefing reveals that after the June 12 conference, the Brancatellis did not exactly follow the Court's suggestion. They did not, for instance, ask the Government “for the material or principal facts which support [its] contentions in the case.” See Steil v. Humana Kansas City, Inc., 197 F.R.D. 445, 447 (D. Kan. 2000). Instead, they pointed to their interrogatory No. 9 as the interrogatory that amounted to a contention interrogatory, which would satisfy their inquiry. See Doc. 49, at 3; Doc. 48, at 2–3. Interrogatory No. 9, states:

Please state the elements or other criteria used by Plaintiff to establish that Defendant Linda S. Brancatelli was determined to be the nominee of Defendant Frank R. Brancatelli, citing the authority that established that Defendant Linda S. Brancatelli was the nominee of Defendant Frank R. Brancatelli.

Doc. 48, at 3; Doc. 49, at 3–4. The Government objected to this interrogatory, stating that the phrase “the determination”—presumably a reference to the interrogatory's use of the phrase was determined—was vague and overly broad and sought work-product protected matters. Doc. 49, at 4; Doc. 48-1, at 15. It asserted that the IRS examined the matter “and made an initial, pre-decisional recommendation to the IRS Office of Chief Counsel,” and then an attorney in that office “reviewed the ․ recommendation and authorized under 26 U.S.C. § 7401 the United States Department of Justice to bring this suit.” Doc. 48-1, at 15; see Doc. 48, at 3. It concluded its objection by explaining that following authorization, Department of Justice “attorneys ․ evaluated the recommendation and also determined under section 7401 that there were sufficient facts to allege particular legal theories.” Doc. 48-1, at 15.

The Brancatellis raised no concerns with the Court about the Government's response to their interrogatory. Instead, they issued a new deposition notice under Rule 30(b)(6). See Doc. 49, at 4. The notice directed the Government to produce a witness to testify about:

The facts that “The attorneys at the United States Department of Justice evaluated the recommendation and also determined under section 7401 that there were sufficient facts to allege particular legal theories” Linda S. Brancatelli was the nominee of Frank R. Brancatelli as alleged in your response to Defendants’ Interrogatory No. 9.

Doc. 45-1, at 1.³

According to the Government's notice of discovery dispute, it objected to this notice and its counsel and Mr. Brancatelli, who is an attorney, and the Brancatellis’ counsel spoke for 25 minutes to try to resolve the issue. Doc. 45, at 2–3. At the end of the discussion, Mr. Brancatelli “encouraged the United States to file” its notice of discovery dispute. Id. at 3.

After the Government filed its notice, the Court set a briefing schedule and scheduled another conference. See Doc. 46.

 The parties’ arguments

In support of its argument, the Government asserts that the Brancatellis decided to “ignore [this Court's] recommendation and instead issue[ ] another Rule 30(b)(6)” notice. Doc. 49, at 2. It notes that the Brancatellis failed to “issue a contention interrogatory seeking facts that show that Linda Brancatelli is a nominee of Frank Brancatelli.” Id. The Government says that the Brancatellis “clear[ly] ․ seek testimony from attorneys at the Department of Justice” who would testify “about how Department attorneys evaluated the recommendation of the IRS Office of Chief Counsel to bring this suit and how Department attorneys determine that there were sufficient facts to allege the theories the parties are litigating.” Id. at 5. The Government asserts that the Brancatellis are attempting to obtain opinion-work product, which is privileged, and are attempting to depose litigation counsel without meeting the standard in Shelton v. American Motors Corp., 805 F.2d 1323 (8th Cir. 1986), which the Sixth Circuit adopted in Nationwide Mutual Insurance Co. v. Home Insurance Co., 278 F.3d 621 (6th Cir. 2002). Id. at 6–7. It concludes that the Court “should enter a protective order, prohibiting the testimony sought in the Defendants’ 30(b)(6) notice.” Id. at 7–10.

The Brancatellis’ presentation is not a model of clarity. They start by saying:

The succinct issue in this case is the criteria upon which the Plaintiff has determined that Linda S. Brancatelli is the nominee of Frank R Brancatelli for the purposes of filing tax liens of Frank R. Brancatelli (first filed on February 2, 2005) against property owned by Linda S. Brancatelli more than eight (8) years after it was purchased on December 12, 1996.

Doc. 48, at 2.

After conceding that opinion work product is subject to “near complete privilege,” they say that an exception “arises when a party affirmatively raises an issue which involves reliance upon the attorney's advice.” Id. at 4 (citing NFA Corp. v. Riverview Narrow Fabrics, Inc., 117 F.R.D. 83, 85 (M.D.N.C. 1987)). They seemingly suggest that this exception applies because they have raised an issue as to internal litigation discussions at the IRS and Department of Justice. In this regard, they point to the fact that:

the attorney at the Department of Justice evaluated the recommendation (sometime in 2005- not opposing counsel) and also determined under section 7401 that there were sufficient facts to allege particular legal theories, apparently, that Linda S[.] Brancatelli is the nominee of Frank R. Brancatelli.

Id.

Later, the Brancatellis add that “[t]he question arises as to who made the recommendation, and more importantly what were the facts that were used in that recommendation that was evaluated by the attorneys at the United States Department of Justice to established that Linda S. Brancatelli is the nominee of Frank R. Brancatelli.” Doc. 48, at 4–5. They also say that they “are ․ seeking to depose ․ the individual(s) who pursuant to the IRS's definition of nominee collected the facts to be submitted to the Department of Justice who determined under Section 7401 that there were sufficient facts to allege particular legal theories.” Id. at 5.

 Analysis

Let's start with the basics. Any party is entitled to discover relevant matters, so long as they are not privileged. Fed. R. Civ. P. 26(b)(1). But a party may not routinely discover attorney-work product—matters “that are prepared in anticipation of litigation.” Fed. R. Civ. P. 26(b)(3)(A); see In re Antitrust Grand Jury, 805 F.2d 155, 163 (6th Cir. 1986) (“the work product doctrine protects any document prepared in anticipation of litigation by or for the attorney”).

Work product comes in two flavors. Fact-work product is “written or oral information transmitted to the attorney and recorded as conveyed by the client.” Antitrust Grand Jury, 805 F.2d at 163. It “may be obtained even absent waiver by a showing of substantial need and hardship.” In re Columbia/HCA Healthcare Corp. Billing Pracs. Litig., 293 F.3d 289, 307 (6th Cir. 2002); Dir., Off. of Thrift Supervision v. Vinson & Elkins, LLP, 124 F.3d 1304, 1307 (D.C. Cir. 1997); see Fed. R. Civ. P. 26(b)(3)(A)(ii).

“Opinion work product is any material reflecting the attorney's mental impressions, opinions, conclusions, judgments or legal theories.” Antitrust Grand Jury, 805 F.2d at 163; see NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 154 (1975) (explaining that the work-product privilege applies to an “attorney's theory of the case and his litigation strategy”). It “cannot be disclosed simply on a showing of substantial need and inability to obtain the equivalent without undue hardship.” Upjohn Co. v. United States, 449 U.S. 383, 401 (1981). Rather, the party seeking it “must show extraordinary justification.” In re Sealed Case, 676 F.2d 793, 810 (D.C. Cir. 1982). “Opinion work product ․ is [thus] virtually undiscoverable.” Dir., Off. of Thrift Supervision, 124 F.3d at 1307.

Rule 30 of the Federal Rules of Evidence governs depositions. “Rule 30(b)(6) provides one method for taking the deposition of a public or private corporation or a partnership or association or governmental entity.” 8A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 2103 (3d ed. June 2024 update). The Government is not immune from the requirements of Rule 30, including Rule 30(b)(6). See United States v. Procter & Gamble Co., 356 U.S. 677, 681 (1958) (“The Government as a litigant is, of course, subject to the rules of discovery.”); Consumer Fin. Prot. Bureau v. Brown, 69 F.4th 1321, 1324 n.1 (11th Cir. 2023) (“Rule 30(b)(6) is the principal mechanism for deposing entities, including government agencies.”).

As noted, the Brancatellis’ presentation is less than clear. For starters, their deposition notice is difficult to parse.⁴ But it is directed at Department of Justice attorneys and their evaluation of the IRS's recommendation and their determination “that there were sufficient facts to allege particular legal theories.” Doc. 45-1, at 1; see Doc. 49, at 5 (interpreting the notice in a similar fashion). On its face, this notice calls for opinion work product. See Sears, Roebuck & Co., 421 U.S. at 154; Antitrust Grand Jury, 805 F.2d at 163; see also SEC v. McGinnis, No. 14-cv-6, 2015 WL 13505396, at *6 (D. Vt. Jan. 13, 2015).⁵

The Brancatellis’ briefing seemingly—it's not a model of clarity—backs up the impression that they seek work product. Early in their brief, they note with emphasis that the Government's response to interrogatory No. 9, included that statement that “attorneys at the United States Department of Justice evaluated the recommendation and also determined under section 7401 that there were sufficient facts to allege particular legal theories.”⁶ Doc. 48, at 3. From their emphasis on the word determined, the Court infers that the Brancatellis are interested in the referenced determination made by Department of Justice attorneys. Indeed, with reference to caselaw about taking depositions of opposing trial counsel, the Brancatellis note that “[i]t should be obvious that opposing counsel in this matter were not even around in 2005 when allegedly the determination was made that Linda S. Brancatelli is the nominee of Frank R. Brancatelli, so the Brancatellis are not attempting to take their depositions or use their work product.” Id. at 4. So Brancatellis want to depose a Department of Justice witness who can testify about the alleged internal conclusion that Mrs. Brancatelli is a nominee.

And, in the next paragraph, they all but concede that they seek opinion work product from attorneys at the Department of Justice. They concede that opinion work product enjoys “near complete protection.” Doc. 48, at 4. But they then argue that an exception to that protection applies—“when a party affirmatively raises an issue which involves reliance upon the attorney's advice.” Id. According to the Brancatellis, this exception is implicated because Department of Justice attorneys “evaluated the [IRS's litigation] recommendation ․ and also determined under section 7401 that there were sufficient facts to allege particular legal theories.” Id. at 4 (emphasis added).

Further, the Brancatellis admit they want to know about the “determin[ation] ․ that there were sufficient facts to allege particular legal theories” and the facts used to make the recommendation to bring this case. Id. And they'd also like to know about the internal evaluation of those facts.⁷ Id. at 4–5.

The bottom line is that the Brancatellis want to depose a Department of Justice attorney to testify about that agency's (1) evaluation for the IRS's litigation recommendation and (2) determination that there were “sufficient facts to allege particular legal theories.” So the Brancatellis want opinion work product. See Sears, Roebuck & Co., 421 U.S. at 154; Antitrust Grand Jury, 805 F.2d at 163; see also McGinnis, 2015 WL 13505396, at *6. To get that, however, they have to present an “extraordinary justification.” Sealed Case, 676 F.2d at 810; see Upjohn, 449 U.S. at 401; Dir., Off. of Thrift Supervision, 124 F.3d at 1307.

The Brancatellis, though, haven't tried to make this showing. Any litigant would like to know what her adversary's counsel thinks of the case. But that doesn't mean that the litigant is entitled to know that information or that the adversary's counsel's opinion is relevant. The Brancatellis assert that “the information sought is relevant and nonprivileged for the Brancatellis to establish their defense in the pending legal action, and the information sought is crucial in the preparation of the Brancatellis’ case.” Doc. 48, at 4. Other than saying it, however, they offer no basis to conclude that what they want is either relevant or nonprivileged.

The Brancatellis claim that an exception to the work-product privilege applies “when a party affirmatively raises an issue which involves reliance upon the attorney's advice.” Doc. 48, at 4. Apparently, the Brancatellis’ argument is that because they've raised the issue of the advice the Government received from its own attorneys, the Brancatellis can defeat the Government's privilege claim. This argument is nonsensical. The Brancatellis’ proposed exception would swallow the privilege whole. Further, the exception to which the Brancatellis point—when a party raises an issue about reliance on counsel's advice—concerns when a party puts its own attorney's advice at issue. See Stern v. O'Quinn, 253 F.R.D. 663, 676–77 (S.D. Fla. 2008); Coleco Industries, Inc. v. Universal City Studios, 110 F.R.D. 688, 690–91 (S.D.N.Y. 1986) (collecting cases). That factual scenario is not presented here through the Government's foreclosure action. Moreover, it is not clear that anyone has raised an issue about reliance on advice of counsel. All the Brancatellis have done is show that they'd like to know about the advice the Government's attorneys provided when deciding to bring this, or possibly a previous, case.

Putting the above aside, let's say that the matters at issue are only fact-work product. In that case, they'd be discoverable on a showing of “substantial need” and “undue hardship.” Fed. R. Civ. P. 26(b)(3)(A)(ii). The Brancatellis, however, offer no basis to conclude that they could make either showing.

Finally, the Brancatellis mention the Government's response to interrogatory No. 16. See Doc. 48, at 5. But the Court has not been notified of a dispute related to this interrogatory. So there is no need to discuss it.

 Conclusion

The Government's request for protective order is granted. The Brancatellis may not depose a witness about the matters described in their notice. The hearing scheduled to take place on July 18, 2024, is canceled.

FOOTNOTES

1.   Rule 30(b)(6) provides a method to depose “a public or private corporation, a partnership, an association, a governmental agency, or other entity.” Fed. R. Civ. P. 30(b)(6).

2.   A contention interrogatory “seek[s] to clarify the basis for or scope of an adversary's legal claims.” Starcher v. Correctional Med. Sys., 144 F.3d 418, 421 n.2 (6th Cir. 1998), aff'd sub nom. Cunningham v. Hamilton Cty., Ohio, 527 U.S. 198 (1999).

3.   This notice is reproduced as written.

4.   The Government characterizes the notice as “incoherent.” Doc. 45, at 2. The deposition notice reads as if its author cut-and-pasted three ideas together and forgot to edit the final product. As a reminder, the Brancatellis’ deposition notice said:The facts that “The attorneys at the United States Department of Justice evaluated the recommendation and also determined under section 7401 that there were sufficient facts to allege particular legal theories” Linda S. Brancatelli was the nominee of Frank R. Brancatelli as alleged in your response to Defendants’ Interrogatory No. 9.Doc. 45-1, at 1.

5.   In McGinnis, the court held that:While a Rule 30(b)(6) deposition may be appropriate to discover facts known to a governmental agency, it may not be used to discover what the agency's counsel thinks about those facts, which facts and witnesses he or she finds persuasive and important, why he or she thinks certain facts give rise to certain inferences or support certain legal theories, or how he or she plans to use the facts at trial.2015 WL 13505396, at *6.

6.   The Brancatellis start their brief by saying that they simply want “the criteria upon which the Plaintiff has determined that Linda S. Brancatelli is the nominee of Frank R Brancatelli.” Doc. 48, at 2. But they then cite the IRS's criteria for making that determination. Id. So they know the criteria that they purport to seek.

7.   Confusingly, the Brancatellis change course near the end of their brief and say that they want to depose the IRS attorney “who pursuant to the IRS's definition of nominee collected the facts to be submitted to the Department of Justice who determined under Section 7401 that there were sufficient facts to allege particular legal theories.” Doc. 48, at 5. The deposition notice at issue, however, concerns attorneys at the Department of Justice. Doc. 45-1, at 1.

James E. Grimes Jr., United States Magistrate Judge