Westernbank P.R. v. Kachkar
United States District Court for the District of Puerto Rico
February 9, 2009, Decided; February 9, 2009, Filed
Civil No. 07-1606 (ADC/BJM)
Defendant Jay Green ("Green") moved for an order compelling plaintiff Westernbank Puerto Rico ("Westernbank") to produce a report and related documents prepared by the accounting firm KPMG LLP ("KPMG") in connection with an audit of Westernbank's asset-based lending division and the Inyx loans [*4] in particular. (Docket No. 314). Westernbank opposed (Docket No. 354) and Green replied. (Docket No. 371). The court ordered Westernbank to produce the contested documents to the court for in camera inspection (the "January 8 Order") (Docket No. 389) and Westernbank complied. (Docket No. 402). The presiding district judge has referred this case to me for full pre-trial management, including ruling on all non-dispositive motions. (Docket No. 160). For the following reasons, Green's motion is DENIED.
The dispute before the court concerns the report of an investigation conducted by the accounting firm KPMG. On June 26, 2007, the Audit Committee of the Board of W Holding Company ("WHI"), Westernbank's parent company, retained the law firm of Adsuar Muniz Goyco Seda & Perez-Ochoa, P.S.C. ("AMGSP"). (Docket No. 354-4, P 2). AMGSP was retained in order to conduct an internal investigation of both the lending transactions among Westernbank, Inyx, and Inyx's subsidiaries, [*5] as well as a broader review of the loan portfolio of Westernbank's Business Credit Division. (Id.). On the same day, AMGSP retained the accounting firm KPMG to provide forensic accounting services in order to assist in counsel's investigation. (Id.; Docket No. 402). Westernbank commenced the action before this court on July 6, 2007 (Docket No. 2) and filed an amended complaint on August 23, 2007. (Docket No. 3). KPMG delivered a report of its investigation of the Inyx loans shortly thereafter on September 14, 2007. (Docket No. 402).
Green provides evidence of Westernbank's public disclosures of the existence of the KPMG report in support of his assertion that KPMG's investigation was undertaken in connection with Westernbank's reporting obligations to various financial regulatory bodies rather than in preparation for litigation. (Docket No. 314). Green also argues that Westernbank waived any applicable privilege through its disclosure of the report to its regular outside auditor, Deloitte & Touche ("Deloitte"). (Id.).Read The Full CaseNot a Lexis Advance subscriber? Try it out for free.
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2009 U.S. Dist. LEXIS 16356 *
WESTERNBANK PUERTO RICO, Plaintiff, v. JACK KACHKAR ET AL., Defendant.
Subsequent History: Motion granted by, in part, Motion denied by, in part Westernbank P.R. v. Kachkar, 2009 U.S. Dist. LEXIS 140919 (D.P.R., Apr. 7, 2009)
Prior History: Westernbank P.R. v. Kachkar, 2009 U.S. Dist. LEXIS 16353 (D.P.R., Jan. 7, 2009)
documents, disclosure, auditor, work product doctrine, waived, loans, contested, asset-based, attorney-client, preparation, lending, Audit, work product protection, work product, portfolio, internal control, anticipated, anticipation of litigation, work product privilege, work product rule, accounting firm, in camera, obligations, argues, courts
Civil Procedure, Discovery, Privileged Communications, Attorney-Client Privilege, Evidence, Burdens of Proof, Allocation, Privileges, Attorney-Client Privilege, Waiver, Elements, Work Product Doctrine, Scope of Protection, Fact Work Product, Waiver of Protections