EFTA00621488.pdf

Page 1 MEETING HELD BEFORE SPECIAL MASTER ROBERT CARNEY IN RE: IN THE CIRCUIT COURT OF THE 15TH JUDICIAL CIRCUIT IN AND FOR PALM BEACH COUNTY, FLORIDA Complex Litigation, Fla. R. Civ. Pro.1201 CASE NO. 50 2009CA040800XXXXMB AG JEFFREY EPSTEIN, Plaintiff, vs. SCOTT ROTHSTEIN, individually, BRADLEY J. EDWARDS, individually, and III., individually, Defendants. DATE TAKEN: Tuesday, March 15, 2011 TIME: 10:05 AM - 12:35 PM PLACE: SEARCY DENNEY SCAROLA BARNHART & SHIPLEY 2139 Palm Beach Lakes Boulevard West Palm Beach, Florida 33409 Lee Lynott, Registered Merit Reporter Registered Professional Reporter Certified Shorthand Reporter Hi-Tech/United Reporting, Inc. 1218 SE 3rd Avenue Fort Lauderdale, FL 33316 United Reporting, Inc. (954) 525- 2221 EFTA00621488  Page 2 1 2 3 APPEARANCES: 4 FOWLER, WHITE, BURNETT, la BY: LILLY ANN SANCHEZ, ESQUIRE 5 JOSEPH ACKERMAN, ESQUIRE CHRISTOPHER KNIGHT, ESQUIRE 6 One Financial Plaza - 21st Floor 100 Southeast 3rd Avenue 7 Fort Lauderdale, Florida 33394 8 FARMER, JAFFE, WEISSING, EDWARDS, FISTOS & LEHRMAN, 9 P.L. BY: BRADLEY EDWARDS, ESQUIRE 10 425 N. Andrews Avenue - Suite 2 Fort Lauderdale, Florida 33301 11 12 SEARCY DENNEY SCAROLA BARNHART & SHIPLEY BY: JACK SCAROLA, ESQUIRE 13 2139 Palm Beach Lakes Boulevard West Palm Beach, Florida 33409 14 15 ALSO PRESENT: 16 MARTIN WEINBERGER, via telephone 17 18 19 20 21 22 23 24 25 United Reporting, Inc. (954) 525- 2221 EFTA00621489  Page 3 1 THEREUPON, 2 (The following meeting took place): 3 SPECIAL MASTER CARNEY: We've got, it looks 4 like, two matters right now. I have some 5 suggestions, but certainly open to 6 suggestions. One, we are meeting to take a look at the 8 privilege log and see whether we have problems 9 with the privilege log; and if we have 10 problems, what needs to be done to correct the 11 problems. Two, we have a Request for Sanctions 12 and we need a resolution on the Request for 13 Sanctions. 14 It seems to me that probably the first thing 15 on the agenda, because it certainly would play 16 into either one, is a determination: Do we 17 have a problem with the privilege log? And if 18 so, what's the problem and what is there to 19 correct it? So, why don't we begin with that. 20 MR. SCAROLA: Before we get underway with 21 that specific business. On the record, I want 22 to renew our request to a stipulation that you 23 be appointed as Special Master in the State 24 Court proceedings. 25 SPECIAL MASTER CARNEY: Response? United Reporting, Inc. (954) 525- 2221 EFTA00621490  Page 4 1 MR. KNIGHT: At this time, let's see where 2 all this goes. We haven't brought that under 3 consideration with our client. We need to speak 4 with him. 5 MR. SCAROLA: Well, that request has been 6 made repeatedly over an extended period of time 7 and I think it is clearly an indication of the 8 bad faith of Mr. Epstein that has been -- 9 SPECIAL MASTER CARNEY: Actually, I believe 10 that plaintiff had actually written a letter and 11 agreed to that quite sometime ago. That was 12 actually in one of the responses I think by Mr. 13 Ackerman. 14 MR. KNIGHT: Well, obviously, we've had 15 these requests out since last July. They are 16 properly before Judge Rey and properly before 17 you at this point. It is not a decision that we 18 need to make today. We believe we have good 19 grounds on these TIG objections. It is close to 20 what should have been accomplished over the last 21 six, seven, eight months now. And so, we note 22 Mr. Scarola's comment for the record. 23 We want to address the two issues that are 24 here today and we can address those other issues 25 at a later time. United Reporting, Inc. (954) 525- 2221 EFTA00621491  Page 5 1 MR. SCAROLA: And it is our position that 2 those issues cannot be properly addressed unless 3 and until there is a State Court ruling with 4 regard to the discoverability of the information 5 that has been requested which appropriately must 6 proceed any requirement that a privilege log of 7 any kind be submitted. 8 SPECIAL MASTER CARNEY: What I would 9 suggest, III viewing the determination of or the 10 presentation of me as a Special Master in the 11 State Court can be divided up into either 12 initially yes, no. If the answer is yes, we 13 still don't have duties yet within the State 14 Court. 15 Ultimately, it seems to me that probably 16 the issue at this point, I don't think anyone 17 looking back on Mr. Ackerman's letter. 18 think that the letter had pretty much indicated 19 a copy of this would certainly go to Judge 20 Rey. Actually, I believe that part of the 21 decision-making process in that letter was to 22 Judge Rey or, excuse me, to Judge Crow. 23 I don't think anyone is really disputing 24 particularly that Judge Crow need be involved in 25 some fashion or another because he is the United Reporting, Inc. (954) 525- 2221 EFTA00621492  Page 6 1 presiding judge over the case. 2 And so, these are things that historically 3 there have been agreements, but we're not 4 necessarily seeing fruition on the agreements. 5 We get an agreement and that seems to be kind of 6 the last we hear of it. 7 But III not necessarily sure that I agree 8 with what Mr. Scarola did. Right now we have to 9 have a resolution as to what role Judge Crow 10 would take vis-a-vis this matter as opposed to 11 Judge Rey. But it seems to me it's easy enough 12 to at least get to a stipulation that at least 13 both are in play somewhat. It seems to me it's 14 pretty hard to determine that Judge Crow isn't 15 in play if he's the presiding judge. 16 MR. KNIGHT: We just don't like creating 17 delay by that for Judge Rey of which I think the 18 different machinations that come from this 19 proceeding that's been -- 20 SPECIAL MASTER CARNEY: III not saying any 21 delay -- 22 MR. KNIGHT: We're not saying you are. If 23 we entered into that stipulation now, I think we 24 would do it right before Judge Crow, we would 25 lose any momentum that we have right now for United Reporting, Inc. (954) 525- 2221 EFTA00621493  Page 7 1 Judge Rey. We want to get on to the actual 2 issues, the same ones we've been asking for. 3 SPECIAL MASTER CARNEY: I agree completely 4 on that. But M, again, not necessarily sure 5 that we have a particular problem. The reason 6 III saying that is when this went in front of 7 Judge Crow, Judge Crow, basically, washed his 8 hands of it and said it's in front of the 9 Bankruptcy Court. Let the Bankruptcy Court 10 decide it. It looks like that's exactly what's 11 going to happen. 12 The only issue that III seeing right now 13 with respect to Judge Crow is there aught to 14 be something in there that Judge Crow ratifies 15 what the Bankruptcy Court judge does. Otherwise, 16 we're left hanging in the wind. Whatever 17 happens here is not binding at all on the State 18 Court judge. The State Court judge can do 19 whatever he wants. 20 MR. SCAROLA: Respectfully, and maybe we're 21 saying the same thing but in different ways, 22 Judge Crow expressly ruled that he will make a 23 determination as to what is discoverable in the 24 State Court proceedings; that he deferred to 25 Judge Rey for purposes of Judge Rey determining United Reporting, Inc. (954) 525- 2221 EFTA00621494  Page 8 1 anything that was pending in the Bankruptcy 2 Court without that having any binding impact 3 upon his decisions with regard to what is 4 discoverable in the State Court. 5 The representations were made to Judge Crow 6 at the time that he made that ruling that there 7 was an independent basis upon which the 8 discovery was being sought in the Bankruptcy 9 Court, that is, that it was not only a State 10 Court subpoena that was issued to the Trustee, 11 but that there were independent discovery 12 requests that were made in the bankruptcy 13 proceeding upon which Judge Rey was proceeding. 14 Now, I don't believe that to have been 15 accurate, but those are the representations that 16 were made to Judge Crow. And on that basis, 17 Judge Crow said Judge Rey can do whatever he 18 wants to but I, Judge Crow, am deciding what is 19 discoverable in my case. That's where that 20 stands. 23. SPECIAL MASTER CARNEY: Which I think he 22 absolutely has the authority to do. I have 23 indicated from the very outset, because it is a 24 State Court action and the final arbiter of that 25 State Court action is Judge Crow, the one who is United Reporting, Inc. (954) 525- 2221 EFTA00621495  Page 9 1 really the best one to resolve this in my view 2 is and always has been Judge Crow. 3 Judge Rey is doing it. Judge Crow has 4 deferred to Judge Rey. All III interested in 5 doing right now is putting Judge Crow in the 6 loop in a fashion where Judge Crow can agree or 7 disagree with whatever my findings are as a 8 Master. 9 Now, unless and until III appointed as a 10 Master in the State Court, he can't do that. 11 And as I say, that leaves us hanging in the wind 12 at that point. I don't think he can on his own 13 simply sua sponte say, III adopting the findings 14 of the Special Master. I think that would 15 create all kinds of appellate issues if we did 16 that. 17 MR. SCAROLA: Nor do I think that the 18 plaintiff should be in the position of waiting 19 to see what your rulings are and then deciding 20 whether the plaintiff wishes to stipulate to 21 those rulings as a recommendation in the State 22 Court. 23 The time to make that decision is now. And 24 if they don't choose to make it, they don't 25 choose to make it. But I want the record to be United Reporting, Inc. (954) 525- 2221 EFTA00621496  Page 10 1 absolutely clear that we are offering to allow 2 your rulings to be binding as rulings of the 3 Special Master in the State Court proceeding as 4 well as the Bankruptcy Court proceeding. We're 5 willing to go so far as to -- 6 SPECIAL MASTER CARNEY: Let me backup for 7 just a second, because it's the "binding" that's 8 the word that's causing a little bit of a 9 problem for me. 10 MR. SCAROLA: I understand and I was about 11 to address that. 12 (Telephone Rings) 13 (WHEREUPON, an off-the-record discussion 14 was had). 15 MR. SCAROLA: The stipulation that we are 16 offering is that you serve as Special Master 17 in the State Court. We go beyond that and we 18 will agree that we will waive any appellate 19 rights that we might have, including appellate 20 rights to the Circuit Court judge, and allow 21 your rulings to be binding within the State 22 Court proceeding. They can accept all or any 23 portion of that stipulation or reject it in its 24 entirety. 25 SPECIAL MASTER CARNEY: III not necessarily United Reporting, Inc. (954) 525- 2221 EFTA00621497  Page 11 sure Illiunderstanding precisely which way 2 you're going. What 'IIIunderstanding the role 3 is and where I see the problem right now, 4 ordinarily, once I make my various findings and 5 recommendations, I submit them to the judge who 6 can give them a thumbs up or a thumbs down. The judge, generally, in the absence of an 8 objection is pretty much bound by what I do. 9 If we have an objection, the court, of course, 10 rules on the objection. 11 The difficulty that III seeing right now is, 12 at the moment we're only going to Judge Rey, 13 which means that -- And Judge Crow has said, I 14 don't care what Judge Rey does. It's my 15 decision. We end up with that problem right 16 there. If we put Judge Crow in the loop, we 17 still have a problem and the problem -- 18 (Telephone Rings) 19 (WHEREUPON, Martin Weinberger joins the 20 proceeding already in-progress via 21 teleconference): 22 MR. WEINBERGER: Hello? 23 MR. ACKERMAN: We're here, Marty. 24 MR. WEINBERGER: Good morning. Thank you 25 very much. And III sorry that I've disrupted United Reporting, Inc. (954) 525- 2221 EFTA00621498  Page 12 1 anything by not calling in earlier. 2 SPECIAL MASTER CARNEY: Do you want to go 3 around the table so he knows who is here? 4 MR. ACKERMAN: Yes. Joe Ackerman is here, 5 Marty. 6 MR. WEINBERGER: Good morning, Joe. 7 MR. KNIGHT: Chris Knight. 8 MR. WEINBERGER: Hi, Chris. 9 MRS. SANCHEZ: Hi, Marty. Lilly Sanchez. 10 MR. WEINBERGER: Hi, Lilly. 11 MR. SCAROLA: Jack Scarola and Bradley 12 Edwards. 13 MR. WEINBERGER: Good morning to you both. 14 SPECIAL MASTER CARNEY: And Robert Carney. 15 MR. EDWARDS: Hi. 16 SPECIAL MASTER CARNEY: As I had mentioned, 17 the problem that III seeing if we have simply 18 both judges copied, as long as we have both the 19 judges making rulings, we have the possibility 20 of inconsistent rulings. Therein, we have a 21 problem. 22 The solution I think, ultimately, is because 23 it is a Judge Crow case and it's being handled 24 in State Court and it's a pure State Court 25 action, ideally, is to have the Special Master United Reporting, Inc. (954) 525- 2221 EFTA00621499  Page 13 1 appointed in the State Court and then have Judge 2 Crow actually be the one ruling on the 3 objections, if there are any objections, but 4 have the report go back with a copy to Judge 5 Rey. 6 Now, any issues that are exclusively Judge 7 Rey issues for which Judge Crow would have no 8 interest in would be in front of Judge Rey. But 9 where there are State Court issues for which 10 Judge Crow would ultimately make the final 11 decision as to admissibility in court, as to 12 discoverability, as to whatever, it seems to me 13 the obvious choice is to have Judge Crow rule on 14 those and not be in a position of a potentially 15 dueling judges' orders. 16 MR. KNIGHT: I understand what you've said, 17 and I'll fill Marty in more on the part he 18 missed. We'll get back to that. 19 SPECIAL MASTER CARNEY: Let's take a look at 20 the privilege log right now. We can come -- 21 MR. SCAROLA: Let me just make sure that my 22 position is clear. I agree with everything that 23 you have said. Obviously, you can only be 24 appointed as Special Master in the State Court 25 proceeding upon stipulation of the parties. United Reporting, Inc. (954) 525- 2221 EFTA00621500  Page 14 1 SPECIAL MASTER CARNEY: I agree. Actually, 2 and by order of the court. It's still going to 3 take a court order. 4 MR. SCAROLA: Well, yes and no. Yes, it 5 would take a court order for you to be appointed 6 as Special Master to follow the proceedings that 7 we have described. The parties are also free to 8 agree to arbitrate these issues -- 9 SPECIAL MASTER CARNEY: Oh, absolutely. 10 MR. SCAROLA: -- to make your decision a 11 binding arbitration decision with regard to the 12 discovery of these documents. We are offering 13 to do both. We are offering to have you 14 appointed as Special Master in the State Court 15 and to follow the proceedings that ordinarily 16 are followed with regard to a Special Master's 17 appointment where you report to the court. 18 There is a possibility for objections being 19 made. The court rules on those objections. 20 Accepts, rejects or modifies the report of the 21 Special Master. We agree to that procedure. 22 We also go a step further. We are willing 23 to allow all of these discovery issues to be 24 resolved by binding arbitration. To have you as 25 Special Master become the arbiter, the final United Reporting, Inc. (954) 525- 2221 EFTA00621501  Page 15 1 arbiter of these discovery issues. 2 If the plaintiff is, in fact, interested in 3 the expedited resolution of these issues, the 4 fastest way to get them resolved is to agree to 5 that procedure. I don't think they've ever been 6 interested in that. 7 Their rejection of our proposal that you be 8 Special Master in the State Court proceedings 9 indicates they have no real interest in that. 10 Their refusal to agree to have these issues 11 arbitrated by you is a further indication that 12 they have no interest in that. 13 This is an abuse of process from beginning 14 to end and all of these discovery proceedings 15 are part of that abuse of the court's process. 16 That's our position. Let them do with it 17 what they want, but I want to be sure that this 18 record reflects what we are willing to do. 19 SPECIAL MASTER CARNEY: I am not necessarily 20 sure that III agreeing one hundred percent with 21 your analysis. I think, even if the parties 22 stipulate, for me to be a binding arbiter would 23 still require a court order. 24 And the reason III saying that is, because 25 III looking at it from the point of view of United Reporting, Inc. (954) 525- 2221 EFTA00621502  Page 16 1 Judge Crow. If I were Judge Crow, the question 2 is: Would I want somebody making decisions for 3 me that go up on appeal with my name on them 4 where illino part of the decision at all? III 5 not necessarily sure that I would agree to 6 that. 7 MR. SCAROLA: There would be no appeal. If 8 it's binding arbitration, there is no appeal. 9 SPECIAL MASTER CARNEY: Well, ultimately, 10 once the case goes up to the appellate court, 11 let's assume just for the sake of argument that 12 I make a ruling and I goof in my ruling. The 13 question is: It eliminates from Judge Crow any 14 ability to correct it. 15 Ultimately, when it goes up on appeal he's 16 the one who's appealed, not me. That's why III 17 viewing where III in Judge Crow's position, 18 whether it's binding arbitration or Special 19 Master, I would like to sign-off on the order. 20 MR. KNIGHT: Judge Carney, I heard Mr. 21 Scarola the first time. I heard him the second 22 time. I heard him the third time. The abuse of 23 process here, we still haven't been able to get 24 a proper privilege log since August. We want 25 to move forward on that. We understand his United Reporting, Inc. (954) 525- 2221 EFTA00621503  Page 17 1 issues and where he wants to go. I don't think 2 arbitration is something we've even discussed, 3 so we will consider that. 4 Although, I think there is a bunch of 5 problems that will come with that relative to 6 appellate rights, et cetera, that would be 7 before Judge Crow because we can't appeal your 8 ruling to the 4th. We can appeal Judge Crow's. 9 I don't want to get into that. I actually 10 want to get into the merits of what this hearing 11 is supposed to be today and not this smokescreen 12 that's being pushed on us, because there are 13 significant deficiencies in this TIG privilege 14 log that we need to discuss. They're very 15 important. It can put us in a position where at 16 this point we'll need to start reviewing the 17 documents. 18 MR. SCAROLA: Let's get at it. 19 MR. KNIGHT: So we need to get into it. 20 SPECIAL MASTER CARNEY: Just before we go. 21 Ultimately - and I do understand the defense 22 position because this has been on the table in 23 the past, apparently, agreed to by the 24 plaintiff - the position is in the absence of 25 following through on the agreement, it's United Reporting, Inc. (954) 525- 2221 EFTA00621504  Page 18 1 ultimately waiting to see what the ruling is 2 here. And if you like the ruling, you agree to 3 it. And if you don't like the ruling, you don't 4 agree to it. 5 As I say, there is some merits to the 6 position that probably aught be resolved before 7 the court makes a particular ruling, but I can't 8 compel resolution one way or the other. What I 9 am advising is, without a resolution of getting 10 in front of Judge Crow, all we're doing at this 11 point is spinning our wheels. 12 As I say, it's a State Court action and 13 Judge Crow has already said, III not bound by 14 whatever the bankruptcy judge does. In the 15 absence of an agreement, this cannot be placed 16 in front of Judge Crow as a fait accompli. 17 So, I see really compelling reasons, legal 18 reasons to go at least part way with what Mr. 19 Scarola is saying. I see only upside and no 20 downside. To do it without it, I see only 21 downside and no upside. 22 At any rate, having said that, let's 23 proceed. Let's start I guess with the privilege 24 log. 25 MR. ACKERMAN: Your Honor, I would like to United Reporting, Inc. (954) 525- 2221 EFTA00621505  Page 19 1 just add a couple of things before we proceed. 2 First of all, this matter has been brought up 3 without being properly noticed. 4 Judge Crow has entered a case management 5 order, which this is one of the items we have to 6 discuss. It's not as simple as Mr. Scarola puts 7 it, because there are issues as we've argued 8 before that Judge Rey has jurisdiction over, 9 including the order that we're here for now. 10 That has to be addressed now because of the 11 outstanding nature of the orders relating to the 12 privilege log. 13 We have other subpoenas that are going to go 14 to the Trustee. The Trustee is under the 15 jurisdiction of a Bankruptcy Court. Mr. 16 Scarola, with all due respect, is inaccurate in 17 relating what I said because, initially, when 18 these matters came before Judge Rey there were 19 other parties seeking records on adversary 20 proceedings. 21 But notwithstanding that, Judge Rey had 22 entered an order stating that based on the fact 23 that he had jurisdiction over the property of 24 R.R.A.'s records that he has jurisdiction over 25 that. United Reporting, Inc. (954) 525- 2221 EFTA00621506  Page 20 1 At this point in time we're asking the 2 court to rule on these two matters, asking the 3 court to enter a recommendation and at that 4 point in time the matter goes to Judge Rey. And 5 I believe that's the time to address these 6 issues, but it can't be done with a simple 7 stipulation because there are other issues that 8 have to be addressed for future subpoenas and 9 whether or not you're going to be appointed on 10 anything beside that. That's something that we 11 haven't discussed or resolved, and I say that 12 with all due respect to Your Honor. 13 But right now, your appointment is for these 14 documents and this subpoena. I believe that 15 in order to accomplish what Mr. Scarola is 16 saying or accomplish, rather, what Judge Crow is 17 saying for a review, ultimately, on the issues 18 that have to come before him, those issues have 19 to be taken into consideration. 20 They can't be done today. They haven't been 21 able to be done before because we haven't 22 addressed them. I think the appropriate time 23 is to do it as part of the case management and 24 not today. 25 MR. SCAROLA: really not sure what Mr. United Reporting, Inc. (954) 525- 2221 EFTA00621507  Page 21 1 Ackerman just said, but if what he has said is 2 he doesn't want to proceed today, he wants to 3 wait and let Judge Crow do this 4 MR. ACKERMAN: No, that's not what 5 saying. illitalking about your suggestion -- 6 MR. SCAROLA: This matter has not been 7 properly noticed. What is the matter -- 8 MR. KNIGHT: He's talking about what you 9 just brought up. 10 MR. SCAROLA: What is the matter that has 11 not been properly noticed? 12 MR. ACKERMAN: What you started this 13 conversation with today, that's what III talking 14 about. Your request for a stipulation, that's 15 not before us today. 16 MR. SCAROLA: Well, I don't know what 17 procedure must be followed to offer to enter 18 into a stipulation. III not aware that I've got 19 to file some written document or give some 20 period of time, notice in advance of raising 21 that issue. I have offered this stipulation 22 repeatedly. It has repeatedly been accepted 23 informally and then rejected. No confirmation 24 has ever been made. 25 I understand that it's been rejected today. United Reporting, Inc. (954) 525- 2221 EFTA00621508  Page 22 1 That's fine. I want it to be clear on the 2 record that that continues to be our position. 3 It will always continue to be our position. I 4 always expect that we will get nothing but delay 5 from the other side. That's okay, too. 6 So, if the matter that has not been properly 7 noticed is our offer of a stipulation, I don't 8 know what that means, let's get on with 9 whatever Mr. Ackerman believes has been properly 10 noticed. 11 SPECIAL MASTER CARNEY: Let's go back to the 12 privilege log at this point and the complaints 13 with the privilege log. Let's see if we have an 14 issue with the privilege log. And if we do, 15 what it is and what needs to be done. 16 MR. ACKERMAN: Your Honor, we filed an 17 extensive memorandum that summarizes, first, the 18 requirements of a privilege log and where, 19 specifically, the privilege log is deficient. 20 While we're on the subject of delay, a proper, 21 legally sufficient privilege log was due on 22 January 31st. One was not presented. It 23 was, basically, a privilege log that listed 24 several thousand documents with one entry to 25 apply to all of them. United Reporting, Inc. (954) 525- 2221 EFTA00621509  Page 23 1 We were before Your Honor again on February 2 16th. Mr. Edwards, Mr. Farmer and III. were 3 given the opportunity to prepare a second 4 privilege log that would comply with the TIG 5 requirements. We received that second privilege 6 log, and that's the one we're here before Your 7 Honor. 8 The case law is abundantly clear that in 9 order for a party that seeks documents claimed 10 to be privileged, they must receive a log that 11 is complete, adequate and defines the 12 relationship of the parties so that they can 13 determine whether a valid privilege has been 14 asserted. 15 In this case throughout the entire log there 16 is no identification of the parties or their 17 capacities, so we cannot determine whether or 18 not they're a part of Mr. Edwards' law firm or 19 whether they're outside it. And I believe the 20 court had even at one point thrown a suggestion 21 out there to prepare some sort of master list 22 to identify that. 23 And while we may not have stated that 24 that would have complied with the cases, the 25 fact is, they have done nothing after being United Reporting, Inc. (954) 525- 2221 EFTA00621510  Page 24 1 given two opportunities to prepare a privilege 2 log. 3 Under the cases that we've cited, 4 particularly, the TIG case and the Century case, 5 the court is entitled if it finds it 6 appropriate, which we're asking it to do, to 7 determine a waiver. 8 What I would like to do is go through the 9 specifics of it. The privilege must 10 provide sufficient information to enable the 11 parties to evaluate the applicability of the 12 claimed privilege. 13 With regard to the attorney-client 14 privilege, we listed the elements that have to 15 be shown. We have to be able to see who the 16 holder is. There is absolutely no 17 identification as to which client they are 18 claiming the privilege for. 19 We have to determine whether the person to 20 whom the communi -- 21 SPECIAL MASTER CARNEY: Don't we only have a 22 single client in this case? 23 MR. ACKERMAN: No. They have made the claim 24 of privilege on behalf of three, three potential 25 victims. United Reporting, Inc. (954) 525- 2221 EFTA00621511  Page 25 1 SPECIAL MASTER CARNEY: Okay. 2 MR. ACKERMAN: And now there are two 3 additional claims that they're making that I 4 suspect they're going to claim at least a 5 work-product privilege on. 6 So, we cannot identify whether the privilege 7 has been appropriately invoked, because they 8 haven't identified 1 of 5 possible clients 9 that could be the holder of the privilege. 10 There has to be an identification if that 11 person to whom the communication is made is a 12 member of the Bar or their subordinate. We 13 cannot tell that from the privilege log. We 14 have to know that it was, in fact, in connection 15 with the rendering of legal services, it wasn't 16 done in the presence of other outside strangers. 17 As far as this privilege log is concerned, 18 as it relates to the attorney-client privilege, 19 since we do not have any capacities described in 20 terms of the client, we do not know what the 21 specific purpose -- They can state the general 22 purpose without describing it and revealing any 23 confidentiality. We cannot know what their role 24 is in relationship to the confidentiality in 25 order for them to establish an attorney-client United Reporting, Inc. (954) 525- 2221 EFTA00621512  Page 26 1 privilege. 2 With regard to the work-product privilege, 3 that privilege is divided into two parts. It's 4 a fact work-product privilege, which relates to 5 information obtained during and in anticipation 6 of litigation. 7 And then there is the privilege that relates 8 to the attorney's mental thoughts and 9 impressions. Under almost all circumstances, 10 the thoughts and impressions of a lawyer are 11 completely privileged as work-product. 12 Under certain circumstances, upon the 13 demonstration of need and upon the demonstration 14 of inability to obtain facts from other sources, 15 fact work-product can be obtained from the party 16 requesting the information. In this instance there is no effort 18 whatsoever to determine or to state whether the 19 privilege claimed to be work-product is fact or 20 work-product. III sorry. Fact, work-product or 21 opinion work-product. 22 Now, I've given the court the cases in 23 there. The case law requires particularized 24 findings in support of your determination as to 25 whether or not they are fact or opinion United Reporting, Inc. (954) 525- 2221 EFTA00621513  Page 27 1 work-product. You're not going to be able to do 2 that nor are we going to be able to make a 3 claim unless that distinction is made. 4 We also, respectfully, direct your attention 5 to the sheer number of people identified who 6 received e-mails from Edwards where no objection 7 is made on the basis of joint defense but only 8 work-product. They haven't established that 9 those people are within the litigation team or 10 the people that are entitled to receive the 11 work-product. 12 Because if he sends information out to third 13 parties that aren't part of his team, we're able 14 to argue that that's a waiver of the 15 work-product privilege without knowing their 16 capacity, without knowing the fact that they're 17 part of the litigation team. There is at least 18 over 20 of those where he's failed to establish 19 who they are. 20 In the pooled joint defense or common 21 litigation interests there are predicates for 22 establishing that. There may be attorneys on 23 there where he's claimed joint defense 24 privilege, although there is no claim of 25 defense against the plaintiffs that's being United Reporting, Inc. (954) 525- 2221 EFTA00621514  Page 28 1 made, but there's a predicate that needs to be 2 established as to who the person is, what the 3 purpose of the joint litigation or common 4 interest was to be, and that case is requiring 5 matters cited and there is no effort at all to 6 break those up. 7 In general, because the document is 8 discussed among participants or transferred 9 among participants in a joint common interest 10 agreement, it doesn't make it work-product if 11 it's not privileged to begin with. 12 For example, there are communications 13 relating to conversations with U.S. Attorneys 14 and FBI Agents which under no circumstances 15 have any privity with the joint defense. So 16 passing it on, particularly coming from them to 17 these agents, certainly is not a work-product 18 privilege. 19 There has to be an establishment, 20 particularly in the instance where they have 21 identified U.S. Attorneys and FBI Agents, as to 22 how that is any type of privilege, because the 23 government does not participate in nor can they 24 as a party in a civil proceeding absent a notice 25 of being filed and particularly in these cases. United Reporting, Inc. (954) 525- 2221 EFTA00621515  Page 29 1 They have listed confidential informants. 2 Now, the case law that we've cited allows the 3 government to withhold a confidential 4 informant's identity at least for a certain 5 period of time. But if that confidential 6 informant has material evidence relevant to the 7 defense of the case then a defendant can get it. 8 There are no cases at all establishing a 9 confidential informant privilege in the civil 10 arena. There is no comparable purpose to be 11 served and there is no legal basis for claiming 12 that type of privilege. 13 Here, the defendants don't claim an 14 informant privilege, which is the one that 15 exists in the criminal area, but they claim the 16 privilege of a confidential source. There is no 17 case law at all that indicates that that is a 18 legal privilege under Florida law, under the 19 Florida Evidence Code that deals with privilege. 20 And just because someone is named a source 21 doesn't make communications from that person to 22 the lawyer privileged or any documents that are 23 transmitted in that fashion. 24 So unless this confidential source is 25 identified to be a lawyer or an investigator United Reporting, Inc. (954) 525- 2221 EFTA00621516  Page 30 1 that's part of Mr. Edwards' litigation team then 2 those are facial waivers of the work-product or 3 any other privilege that's claimed, because they 4 are clearly third parties. And the lack of 5 identification of those people clearly makes 6 those impossible for us to tell. And if they 7 are claiming them to be, for example, in the 8 case of the FBI Agents or the U.S. Attorney, 9 those are clearly third parties. 10 There is also a claim for privilege based on 11 protective privacy rights. They haven't 12 identified any specific privacy right or 13 described the person whose privacy interests are 14 at stake. They haven't identified any of the 15 people that are claiming the privilege in other 16 aspects as well. But here, there can be no 17 valid privilege raised to protect a generic 18 privacy right. 19 Under Section 90.501 of the Florida 20 Statutes it lists the privileges that apply. 21 Absent the establishment of those privileges, 22 any document that is requested should be 23 produced. 2.4 I just want to add one thing that was 25 brought up earlier. Mr. Scarola has argued that United Reporting, Inc. (954) 525- 2221 EFTA00621517  Page 31 1 there has been no determination on the relevancy 2 of this subpoena. I submit to you, in prior 3 memorandums this issue has already been 4 addressed and you mentioned it at the last 5 hearing. 6 When this subpoena went out to the U.S. 7 Trustee in April, Mr. Scarola asked for copies. 8 There was no objection made at that time at the 9 time the subpoena was sent out. So, it's our 10 position the issues of relevancy are not 11 properly before you on this proceeding. 12 But with regard to the privacy, there is no 13 reason -- there is no case law that extends the 14 right of privacy to the issues that are set 15 forth here. They haven't claimed why it's 16 private. They haven't claimed who's stating 17 it's private. And we contend that those are 18 facial waivers to the extent documents rely only 19 on the privacy right. 20 Now, we've argued and I've given the court a 21 lengthy list of cases that it settled that the 22 failure to supply an adequate privilege log 23 results in a waiver of the privilege under 24 Florida or Federal law. There is a specific 25 case that I cited, Century Business Credit Corp. United Reporting, Inc. (954) 525- 2221 EFTA00621518  Page 32 1 It's in the brief and I have a copy of it. 2 In that case the 4th District allowed a 3 waiver to be found because the log was not only 4 months late, but also completely inadequate. 5 The citation for that in my brief and for the 6 record is: Century Business Credit 7 Corporation vs. Fitness Innovations and 8 Technology, 906 So.2d, 1156, Florida 4th DCA, 9 2005. 10 As I've indicated to you before, Mr. 11 Edwards, Farmer & Jaffe and M. have had the 12 opportunity for the last, you know, from the 13 time the initial orders and documents were 14 provided, and certainly by January 31st, to 15 prepare an adequate log. 16 We are now six weeks beyond that and still 17 do not have a log that allows us to identify 18 meaningful objections with sufficient detail to 19 comply with the requirements of Florida Rules of 20 Civil Procedure 1.280, as well as the TIG case 21 and the Century Business case so that we can 22 make appropriate objections on this. 23 As a result of this we're asking the court 24 that, because no less than four orders directing 25 Edwards, et al. to prepare this privilege log United Reporting, Inc. (954)525- 2221 EFTA00621519  Page 33 1 have been complied with and since the last two 2 do not remotely meet the TIG requirements, we're 3 asking the court to enter a finding that the 4 privileges have been waived. 5 Your Honor, on Page 83, if you need to see 6 the log. 7 MR. KNIGHT: These are just some examples. 8 MR. ACKERMAN: To give you an example, if 9 you look at Page 83, it says Brad to source. It 10 doesn't say who the source is. It's claimed 11 within the work-product privilege. We need to 12 have the identity to know if there is a waiver. 13 If you go to Page 85, you have Brad to 14 R.R.A.. We don't know who the attorney is, 15 whether it's Rothstein, whether it's someone in 16 the firm based on the investment team that was 17 attempting to arrange these investments through 18 third parties. 19 There's a similar problem on Page 86 for 20 Rothstein on e-mail regarding causes of action. 21 We believe that that would be work-product only 22 if it relates to a pre-existing client. 23 On Page 87 and 138, we have Jenne to 24 attorneys in Rothstein's firm. If Rothstein 25 We don't know who that's going to. We've United Reporting, Inc. (954) 525- 2221 EFTA00621520  Page 34 1 established in deposition that Mr. Jenne brought 2 boxes of the 1M file to at least two 3 individuals who were interested in investing in 4 Mr. Rothstein's ponzi scheme. 5 If Mr. Jenne is sending the e-mail to 6 Rothstein, without knowing what the subject 7 matter is, it could be related to the scheme or 8 it could be to Mr. Edwards relating to the case 9 or the scheme. 10 Page 100, there's a listing for Coffey. If 11 he's not an attorney for R.R.A. and he's not in 12 the firm, then there may be a waiver of the 13 privilege. 14 We have Page 136 where there's an e-mail or 15 a letter from Brad to R.R.A. relating to 16 Clinton. We don't know which client that is. 17 We believe that part of the scheme to entrap 18 investors to this ponzi scheme was to subpoena 19 people like Bill Clinton and Donald Trump. And 20 there is testimony from Dean Kretschmar that 21 talks about a log book of people that were on 22 Mr. Epstein's plane, including Mr. Clinton. 23 Page 118, there's a reference to Carl 24 Linder. He appears to be involved in the 25 transactions involving t