Judge rules PCMR may lose attorney-client privilege on emails
September 6, 2013
Attorneys for Talisker Land Holdings LLC, owners of much of Park City Mountain Resort’s ski terrain, appeared in Summit County’s Third District Court Friday, Sept. 6, to ask Judge Ryan Harris to remove attorney-client privilege from emails sent among PCMR executives and lawyers during the weekend in 2011 that PCMR attempted to renew the lease now at issue. In its effort to win the privilege issue, Talisker attorneys argued that PCMR had "falsely alleged things to this court."
Attorney-client privilege generally protects (i.e., allows one to withhold from one’s adversary in a legal proceeding) communications between an attorney and his or her client. In this case, Talisker wants access to emails that it believes will show a deliberate attempt to commit fraud.
On Friday, Sept. 6, Judge Harris held a hearing on the discovery issue. Talisker attorney John Lund argued that "Somebody [at PCMR] made a decision to change the date on that letter" and "somebody made a decision to sign it." Lund asserted that this was done "to desperately hold on to this resort, after making an obvious mistake."
Mr. Lund called the backdating of the letter "a deceitful scheme" and concluded that PCMR "deliberately tried to misrepresent this to us and doing that with your lawyer’s help is not privileged."
Bruce Meyer, attorney for PCMR, then argued that one of Talisker’s arguments for why privilege should not apply was not applicable. The judge would later rule in favor of Meyer’s argument. Meyer was unsuccessful, however, in convincing the judge that the so-called "crime-fraud exception" of the Utah Rules of Evidence should not apply to the present facts. He argued that there was no evidence that any alleged "fraud" involved an attorney.
Judge Harris noted, however, that Cary Jones – an attorney – both drafted the letter and was present when it was signed. When he ruled that the crime-fraud exception may indeed apply to some of the emails at issue, he specifically noted Jones.
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Judge Harris said PCMR’s acknowledgement of the backdating was prima facie evidence "that there was at least an attempted fraud going on."
Depositions are scheduled to begin Wednesday, Sept. 11, and because that date is quickly approaching, Judge Harris made an immediate ruling. He ordered PCMR to submit 21 April-30-weekend emails to him by Monday morning. The judge will then review the emails himself and decide which, if any, should be made available to the Talisker side of the litigation. He will be looking specifically for any communications that discuss the dating of the lease renewal letter.
Judge Harris indicated that he wanted any emails that he deems relevant to the backdating to be made available to Talisker prior to the depositions, so he is expected to issue a ruling on the specific emails prior to Wednesday.
On Monday, Aug. 23, PCMR’s lead attorney, Alan Sullivan, submitted a written acknowledgement to Third District Court Judge Ryan Harris that PCMR had backdated the 2011 letter.
The lease at issue was supposed to be renewed by Friday, April 30, 2011, but PCMR acknowledged on Aug. 23 of this year that it did not actually send the letter until Monday, May 2, 2011. They are arguing that there are other facts surrounding the lease renewal which should deem the lease properly renewed.
Since Mr. Sullivan’s Aug. 23rd acknowledgement, however, the suit has become more contentious. On Wednesday, Aug. 28, Talisker Corp., via a subsidiary, served PCMR with a Notice to Quit, which ordered PCMR to vacate its Talisker-leased land within five days. It was effectively an eviction notice.