Motorola Solutions, Inc. v. Zurich Ins. Co.

2017 IL App (1st) 161465 (Ill. App., 2017)

Words & Phrases

Assistance And Cooperation

Trial Judge

Margaret A. Brennan

Appellate Judge

Gordon

Holding

Insured not required by cooperation clause or common interest doctrine to share attorney-client privileged documents with its insurers where such documents were created by separate counsel long before the claims arose.

Fact Summary

The instant appeal arises from a discovery dispute between plaintiff Motorola Solutions,

Inc., and defendants Zurich Insurance Company (Zurich) and Associated Indemnity Corporation (Associated) concerning the production of documents that plaintiff claims are privileged. The parties are engaged in insurance coverage litigation, stemming from several underlying personal injury actions in which claims were asserted against plaintiff. Plaintiff filed a motion for summary judgment with respect to Zurich’s duty to defend one of the actions and the trial court stayed briefing on the motion to permit limited discovery concerning a late notice defense asserted by defendants. As part of discovery, defendants sought the production of several documents that plaintiff claimed were privileged. The trial court ordered plaintiff to turn over the documents, and plaintiff refused. The trial court then held plaintiff in friendly civil contempt to permit plaintiff to appeal. For the reasons that follow, we reverse the trial court’s order requiring production of the documents and vacate the friendly contempt order.

.In the case at bar, we agree with plaintiff that Waste Management does not encompass the situation present in the instant case, as Waste Management involved a factual scenario in which the insurers were seeking documents from the litigation for which the insureds were seeking indemnification. By contrast, in the case at bar, defendants have not sought the files from the litigation in the underlying clean room cases; instead, they are seeking files that were created years prior to any litigation. The difference this distinction makes becomes apparent when examining the cooperation clause of the Zurich policy, which Zurich claims is “virtually identical” to the one at issue in Waste Management. The cooperation clause requires plaintiff to “cooperate with the company and, upon the company’s request, assist in making settlements, in the conduct of suits and in enforcing any right of contribution or indemnity against any person or organization who may be liable to the insured ***.” In Waste Management, this clause applied to the files the insurers sought, as they were files that concerned the conduct of the suits and the enforcement of rights of contribution or indemnity. By contrast, nothing in this cooperation clause touches on the disclosure of the contents of plaintiff’s CRSP documents, which were created by different attorneys over a decade before any lawsuit was filed. It is thus unclear how the reports created under the CRSP would assist defendants in “making settlements, in the conduct of suits, [or] in enforcing any right of contribution or indemnity against any person or organization who may be liable to the insured.” At most, such documents would help defeat plaintiff’s claims against defendants, which is not a subject included in the cooperation clause. The same is true of the S-1 documents, which are even further removed from the defense of any litigation for which plaintiff seeks coverage, as they are related to securities filings.

By contrast, in the case at bar, defendants are not seeking the defense files in the underlying litigation but are, instead, seeking to obtain documents that were prepared years prior to the commencement of the instant litigation. Contrary to the dissent’s statement otherwise, the instant case and Waste Management thus do not contain remotely “similar facts.” Neither the dissent nor defendants’ petition for rehearing cites any authority for the proposition that an insured must disclose documents that were prepared by separate counsel years prior to any litigation. Instead, both apply an expansive interpretation of Waste Management that strips it of the factual context in which that case was decided. Nothing in Waste Management suggests that it is intended to apply to situations in which an insurer is seeking prelitigation documents prepared by completely different counsel from the counsel involved in litigating the underlying claims, and we cannot interpret the case to stand for something it simply does not hold

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