Boyd v. Comdata Network, Inc.

IN THE COURT OF APPEALS OF TENNESSEE
AT NASHVILLE
November 9, 2000 Session

DUDLEY G. BOYD, ET AL. v. COMDATA NETWORK, INC., ET AL.

Appeal from the Chancery Court for Williamson County
No. 26397 Russ Heldman, Judge

No. M2000-00949-COA-R9-CV - Filed April 30, 2002

This appeal involves a discovery dispute implicating the common interest privilege and the work
product doctrine. After filing suit in the Chancery Court for Williamson County to rescind their
guaranties, the individual guarantors of a corporate debt served interrogatories and requests for
production of documents on the creditor seeking copies of all written communications between the
creditor and the corporation from which the creditor had purchased the corporate debt. The creditor
objected to the production of documents involving its negotiation of a joint defense agreement with
the original creditor and the drafts of an agreement to repurchase the corporate debt. The trial court
directed the creditor to produce both categories of documents but permitted the creditor to pursue
an interlocutory appeal. We granted the interlocutory appeal to address the application of the
common interest privilege and the work product doctrine. We have determined that the common
interest privilege shields the documents relating to the joint defense agreement from discovery and
that the work product doctrine likewise protects the drafts of the repurchase agreement.
Accordingly, we reverse the trial court’s order compelling the production of these documents.

Tenn. R. App. P. 9 Interlocutory Appeal; Judgment of the Chancery Court Reversed

WILLIAM C. KOCH, JR., J., delivered the opinion of the court, in which WILLIAM B. CAIN and
PATRICIA J. COTTRELL, JJ., joined.

William R. O’Bryan, Jr., Kenneth M. Bryant, and E. Todd Presnell, Nashville, Tennessee, for the
appellant, Comdata Network, Inc.

Scott Justin Crosby and Susan M. Clark, Memphis, Tennessee, and George H. Nolan and Julie C.
Murphy, Nashville, Tennessee, for the appellees, Dudley G. Boyd and Jan E Boyd.

OPINION

I.

The Fidelity Group, Inc. (“Fidelity Group”) is a Tennessee corporation engaged in the
business of receivable financing for small transportation companies. Its president and majority
stockholder is Dudley G. Boyd who lives in Memphis, Tennessee. In connection with its business,
Fidelity Group obtained an unsecured line of credit from NTS, Inc. (“NTS”), a Delaware corporation
located in Fort Worth, Texas. NTS provides financial and related services to trucking companies,
truck stops, and other members of the transportation industry.

By September 1997, Fidelity Group had drawn down $834,750.66 on its NTS line of credit
and was unable to repay it. Mr. Boyd, Fidelity Group, and another Tennessee corporation Mr. Boyd
controlled entered into three agreements with NTS on January 15, 1998, to restructure Fidelity
Group’s debt. First, NTS and Sovryn, Inc. (“Sovryn”)1 entered into a Marketing Services
Agreement, anticipating that Sovryn’s commissions would be used to pay down Fidelity Group’s
debt to NTS. Second, both Fidelity Group and Sovryn executed a Promissory Note and Debt
Reduction Agreement in which they agreed to be jointly and severally liable for Fidelity Group’s
debt and to repay the debt in scheduled installments by 2001. Third, Mr. Boyd and the Boyd
Revocable Inter-Vivos Trust (“Boyd Trust”)2 executed a Guaranty Agreement guarantying the
payment of the Promissory Note and Debt Reduction Agreement executed by Fidelity Group and
Sovryn.

During the negotiations over the restructuring of Fidelity Group’s debt, NTS disclosed to Mr.
Boyd that it was negotiating the sale of substantially all of its assets to Comdata Network, Inc.
(“Comdata”), including the Marketing Services Agreement, the Promissory Note and Debt
Reduction Agreement, and the Guaranty Agreement. Following consultations with Comdata, Mr.
Boyd, on behalf of himself and his corporations, assented to this transaction. On January 17, 1998,
NTS entered into an Exchange Agreement with Comdata conveying to Comdata all its right, title,
and interest in the Marketing Services Agreement, the Promissory Note and Debt Reduction
Agreement, and the Guaranty Agreement. The Exchange Agreement contained a repurchase
provision enabling Comdata to require NTS to repurchase any of the assets covered by the Exchange
Agreement. Thereafter, NTS changed its name to IPS Card Solutions, Inc. (“IPS”).

Time passed without much progress in reducing the $834,750.66 debt. In the summer of
1998, Comdata declared the Promissory Note and Debt Reduction Agreement in default and
terminated the Marketing Services Agreement. In February 1999, facing the prospect that Comdata
would call upon him and the Boyd Trust to honor their Guaranty Agreement, Mr. Boyd and the Boyd
Trust (“the Boyd parties”) filed suit in Memphis seeking rescission of their guaranties and damages
for Comdata’s alleged breach of the Marketing Services Agreement. On July 30, 1999, after their
Memphis suit was dismissed for improper venue, the Boyd parties filed the same complaint in the
Chancery Court for Williamson County.

The Boyd parties’ suit prompted Comdata to invoke its rights under the Exchange Agreement
to require IPS, as NTS’s successor, to repurchase the NTS assets. During the discussions that
followed, Comdata and IPS negotiated not only the terms of a Purchase Agreement for the note but

1
Sovryn, Inc. is a Tennessee corporation engaged in the receivable financing business. Mr. Boyd is its
president and sole stockholder.

2
The Boyd Revocable Inter-Vivos Trust is a California Trust created by Mr. Boyd and Jan E. Boyd, his wife.

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also the terms of a Joint Defense Agreement with regard to the litigation pending in the trial court.3
On August 17, 1999, while the negotiations between Comdata and IPS were taking place, the Boyd
parties filed interrogatories and requests for production of documents seeking documents and other
communications between Comdata and NTS regarding the Boyd parties, Fidelity Group, or Sovryn.4

Two significant developments occurred on November 15, 1999. First, Comdata and IPS
executed a Purchase Agreement in which Comdata assigned the promissory note and debt reduction
agreement to IPS. Second, Comdata filed its response to the Boyd parties’ interrogatories and
request for production of documents. Citing the attorney-client privilege and the work product
doctrine, Comdata objected to producing (1) the drafts of the Purchase Agreement covering the note,
(2) the correspondence between Comdata’s and IPS’s lawyers regarding the Purchase Agreement,
(3) the proposed Joint Defense Agreement, and (4) the correspondence between the lawyers for
Comdata and IPS regarding the proposed Joint Defense Agreement.

On February 3, 2000, IPS launched what it intended to be a preemptive strike by filing suit
in the United States District Court for the Southern District of New York to enforce the Boyd
parties’ guaranties. The Boyd parties responded on February 14, 2000, by moving to amend their
complaint in this proceeding to add IPS as a defendant. Three days later, they moved to compel
Comdata to respond to their interrogatories and request for production of documents. On February
29, 2000, the trial court filed an order permitting the Boyd parties to amend their complaint to add
IPS as a defendant. The amended complaint was filed on March 3, 2000. On April 17, 2000, the
trial court granted the motion to compel but also authorized Comdata to pursue an interlocutory
appeal to this court. Ten days later, Comdata applied to this court for an interlocutory appeal. We
granted Comdata’s application on May 11, 2000.5

II.
THE STANDARD OF REVIEW

We turn first to the standard of review. Comdata’s appeal challenges the trial court’s
decisions regarding the scope of pre-trial discovery and its invocation of the attorney-client privilege
and the work product doctrine. Decisions regarding discovery issues address themselves to a trial

3
The lawyers representing Comdata and IPS discussed the terms of the proposed Joint Defense Agreement and
exchan ged dra fts of the agr eemen t, but Com data and IPS nev er entered into a joint d efense ag reemen t.

4
Specifically, the request for production of documents sought “[a]ll correspondence, memoranda, notes or other
docum ents reflecting, concerning or evidencing any communications between . . . [Comdata] and NTS concerning the
Plaintiffs, Fidelity and/or Sovryn” and “[a]ll correspondence, memoranda, notes or other documents reflecting,
concerning or evidencing any communication between . . . [Comdata] and NTS regarding the negotiation, performance,
nonperformance, breach and/or any aspect of the Agreements.”

5
In the mea ntime, the Boyd p arties had re quested the United States District C ourt to ab stain in defe rence to
this proceeding or, in the alterna tive, to dism iss IPS’s com plaint beca use the fo rum w as not con venient. On May 12,
2000, the United States District Court filed an opinion and order granting the motion to abstain based on the reasoning
of Colorado River Water Conservation Dist. v. United States, 424 U.S. 800 , 817, 96 S. Ct. 123 6, 1246 (1976) . IPS Card
Solutions, Inc. v. Boyd, No. 00 CIV.07 76 (M BM), 2 000 W L 620 213, at *4 (S.D.N.Y . May 1 2,2000 ).

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court’s discretion, Benton v. Snyder, 825 S.W.2d 409, 416 (Tenn. 1992); Payne v. Ramsey, 591
S.W.2d 434, 436 (Tenn. 1979); Harrison v. Greeneville Ready-Mix, Inc., 220 Tenn. 293, 302-03,
417 S.W.2d 48, 52 (1967), as do decisions regarding the application of the attorney-client privilege
and the work product doctrine. In re Grand Jury Proceedings, 219 F.3d 175, 182 (2d Cir. 2000);
Frontier Ref. Corp. v. Gorman-Rupp Co., 136 F.3d 695, 699 (10th Cir. 1998). Accordingly, the
appellate courts must review these decisions using the “abuse of discretion” standard of review.

While the “abuse of discretion” standard limits the scope of our review of discretionary
decisions, it does not immunize these decisions completely from appellate review. Duncan v.
Duncan, 789 S.W.2d 557, 561 (Tenn. Ct. App. 1990). Even though it prevents us from second-
guessing the trial court, White v. Vanderbilt Univ., 21 S.W.3d 215, 223 (Tenn. Ct. App. 1999), or
from substituting our discretion for the trial court’s discretion, Myint v. Allstate Ins. Co., 970 S.W.2d
920, 927 (Tenn. 1998); State ex rel. Vaughn v. Kaatrude, 21 S.W.3d 244, 248 (Tenn. Ct. App. 2000),
it does not prevent us from examining the trial court’s decision to determine whether it has taken the
applicable law and the relevant facts into account. Ballard v. Herzke, 924 S.W.2d 652, 661 (Tenn.
1996). We will not hesitate to conclude that a trial court “abused its discretion” when the court has
applied an incorrect legal standard, has reached a decision that is illogical, has based its decision on
a clearly erroneous assessment of the evidence, or has employed reasoning that causes an injustice
to the complaining party. Clinard v. Blackwood, 46 S.W.3d 177, 182 (Tenn. 2001); Buckner v.
Hassell, 44 S.W.3d 78, 83 (Tenn. Ct. App. 2000); In re Paul’s Bonding Co., 62 S.W.3d 187, 194
(Tenn. Crim. App. 2001); Overstreet v. Shoney's, Inc., 4 S.W.3d 694, 709 (Tenn. Ct. App. 1999).

When called upon to review a discretionary decision, we will review the trial court’s
underlying factual findings using the preponderance of the evidence standard in Tenn. R. App. P.
13(d). However we will review the trial court’s purely legal determinations de novo without a
presumption of correctness. Brown v. Birman Managed Care, Inc., 42 S.W.3d 62, 66 (Tenn. 2001);
Burlew v. Burlew, 40 S.W.3d 465, 470 (Tenn. 2001); see also In re Grand Jury Proceeding, 156
F.3d 1038, 1042 n.1 (10th Cir. 1998). By definition, a trial court “abuses its discretion” when it
makes an error of law. Koon v. United States, 518 U.S. 81, 100, 116 S. Ct. 2035, 2047 (1996).

III.
THE DRAFTS OF THE JOINT DEFENSE AGREEMENT

The trial court determined that Comdata could not invoke the common interest privilege to
challenge several of the Boyd parties’ interrogatories and requests for production of documents. On
this appeal, Comdata asserts that the trial court erred by determining that it could not use the
common interest privilege to avoid producing copies of correspondence and other documents
relating to its negotiations with IPS regarding a proposed Joint Defense Agreement. We have
determined that Tennessee recognizes the common interest privilege as an extension of the attorney-
client privilege and that Comdata has demonstrated, by a preponderance of the evidence, that it is
entitled to invoke this privilege to prevent the discovery of the documents involving the proposed
Joint Defense Agreement.

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 A.

The law favors making all relevant evidence available to the trier of fact. Neil P. Cohen, et
al., Tennessee Law of Evidence § 5.01[2] (4th ed. 2000). Accordingly, Tenn. R. Evid. 501 limits the
ability of parties and witnesses to refuse to disclose information or documents to the “privileges”
provided by the constitution, statutes, common law, and rules promulgated by the Tennessee
Supreme Court. One of the privileges, in fact the oldest privilege,6 recognized in Tennessee both
at common law7 and by statute8 is the attorney-client privilege. This privilege serves the
administration of justice by encouraging full and frank communication between clients and their
attorneys by sheltering these communications from compulsory disclosure. Upjohn Co. v. United
States, 449 U.S. at 389, 101 S. Ct. at 682; Bryan v. State, 848 S.W.2d 72, 79 (Tenn. Crim. App.
1992).

The attorney-client privilege is not absolute, nor does it cover all communications between
a client and his or her attorney. The communications must involve the subject matter of the
representation9 and must be made with the intention that they will be kept confidential.10 The
privilege applies not only to the client’s communications but also to the attorney’s communications
to his or her client when the attorney’s communications are specifically based on the client’s
confidential communications or when disclosing the attorney’s communications would, directly or
indirectly, reveal the substance of the client’s confidential communications. Burke v. Tennessee
Walking Horse Breeders’ & Exhibitors’ Ass’n, No. 01A01-9611-CH-00511, 1997 WL 277999, at
*11 (Tenn. Ct. App. May 28, 1997) (No Tenn. R. App. P. 11 application filed); Bryan v. State, 848
S.W.2d at 80.

The attorney-client privilege “belongs” to the client. Smith County Educ. Ass’n v. Anderson,
676 S.W.2d 328, 333 (Tenn. 1984); State v. Parker, 932 S.W.2d 945, 955 (Tenn. Crim. App. 1996).
Accordingly, a client may waive11 the privilege either by communicating in the presence of others
who are not bound by the privilege, Hazlett v. Bryant, 192 Tenn. at 257, 241 S.W.2d at 123, or by

6
Courts and text writers have characterized the attorney-client privilege as the oldest privilege for confidential
communication know n to the co mmo n law. Upjohn Co. v. United States, 449 U .S. 383, 3 89, 101 S. Ct. 677, 682 (1981);
Federal Ins. Co. v . Arthur Anderson & Co., 816 S.W .2d 328 , 330 (T enn. 19 91); Ed ward J. Im winkelr ied, The New
Wigmore: Evidentiary Privilege s § 6.2.4, at 471 (20 02); Ed na S. Ep stein, The Attorney-Client Privilege and the Work-
Product Doctrine 2 (4th ed. 2001) (“Epstein”).

7
Johnson v. Patterson, 81 Tenn. 626, 649 (1884) (holding that the codification of the attorney-client privilege
embo dies the co mmo n-law ru le); McM annus v . State, 39 Ten n. (2 Hea d) 213, 2 15-16 (1858) .

8
Tenn. Code An n. § 23-3-105 (1994 ).

9
Jackson v. State, 155 Tenn. 371, 376, 293 S.W. 539, 540 (1927) ; Johnson v. Patterson, 81 Tenn. at 649
(holding that “there are many transactions between attorney and client, that have no element of confidence in them, of
which . . . [th e attorney ] is comp etent to testify” ).

10
Hazlett v. Bryant, 192 Te nn. 251 , 258, 24 1 S.W.2 d 121, 1 24 (195 1).

11
Smith County Educ. Ass’n v. Anderson, 676 S.W .2d at 333 ; see also Tenn. S. Ct. R. 8, DR 4-101(B)(1).

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voluntarily divulging the communication to third parties. Taylor v. State, 814 S.W.2d 374, 377
(Tenn. Crim. App. 1991). It is also subject to exceptions grounded in public policy that do not
depend on a client’s waiver of the privilege. Tenn. S. Ct. R. 8, DR 4-101(C)(2), (4).12

B.

The common interest privilege13 recognizes the advantages of, and even necessity for, an
exchange or pooling of information among attorneys representing parties sharing a common legal
interest in litigation. Transmirra Prods. Corp. v. Monsanto Chem. Co., 26 F.R.D. 572, 579
(S.D.N.Y. 1960). It extends the scope of the attorney-client privilege14 by providing an exception
to the general rule that communications made in the presence of or shared with third parties are not
protected by the attorney-client privilege.15 While the common interest privilege was originally
applied in criminal cases, Chahoon v. Commonwealth, 62 Va. (21 Gratt.) 822 (1871), it has long
since been extended to civil proceedings. In re Grand Jury Subpoenas, 89-3 & 89-4, John Doe 89-
129, 902 F.2d 244, 249 (4th Cir. 1990); Aiken v. Texas Farm Bureau Mut. Ins. Co., 151 F.R.D. 621,
623 (E.D. Tex. 1993); Visual Scene, Inc. v. Pilkington Bros., 508 So. 2d 437, 439 n.2 (Fla. Dist. Ct.
App. 1987); Aetna Cas. & Sur. Co. v. Certain Underwriters at Lloyd’s of London, 676 N.Y.S.2d at
732. The common interest privilege has been specifically recognized by the Tennessee Supreme
Court. Vance v. State, 190 Tenn. 521, 529-30, 230 S.W.2d 987, 990-91 (1950).

The common interest privilege widens the circle of persons to whom clients may disclose
privileged communications. It permits the participants in a joint defense to communicate among
themselves and with their attorneys on matters of common legal interest for the purpose of
coordinating their joint legal strategy. United States v. Henke, 222 F.3d 633, 637 (9th Cir. 2000);
1 Paul R. Rice, Attorney-Client Privilege in the United States § 4:35, at 192 (2d ed. 1999)
(“Attorney-Client Privilege in the United States”). In the circumstances where the common interest

12
The Code of Professional Responsibility specifically permits att orneys to reveal client confidences and
secrets when the information is necessary to prevent a client from com mitting a crime, to collect a fee, or to defend
against an accusation of wrongful conduct. It also permits attorneys to reveal client confidences and secrets when
permitted under th e disciplinar y rules or re quired b y law or a court ord er.

13
The com mon interest privilege has frequently been referred to as the “joint defense privilege” because the
privilege was originally and is now most commonly invoked in the context of a joint defense. The more accurate term
is “comm on interest” privilege. In re Grand Jury Subpoenas 89-3 & 89-4, John Doe 89-129, 902 F.2 d at 249 ; United
States v. Schwimmer, 892 F.2 d 237, 2 43 (2d C ir. 1989); Hicks v. C omm onwea lth, 439 S.E.2d 414, 41 6 (Va. C t. App.
1994); Restatement (Third) of the Law Governing Lawyers § 76 cmt. b (2000). Accordingly, we will refer to the
privilege as the “common interest privilege.”

14
United States v. Evans, 113 F.3 d 1457 , 1467 (7 th Cir. 199 7); United States v. Schwimmer, 892 F.2d at 243-
44; Volpe v. Conroy, Simberg & Ganon, P.A., 720 So . 2d 537 , 539 (Fla . Dist. Ct. Ap p. 1998 ); Aetna C as. & Sur. Co.
v. Certain Underwriters at Lloyd’s of London, 676 N .Y.S.2d 727, 73 2 (N.Y . 1998).

15
The common interest privilege does not provide an independent basis for refusing to reveal information or
produce documents that would not otherwise be protected by the atto rney-clien t privilege. United S tates v. Agn ello, 135
F. Supp. 2d 380, 382 (E .D.N.Y. 2001); Securities Investor Protection Corp. v. Stratton Oakmont, Inc., 213 B.R. 433,
435 (Bankr. S.D.N.Y. 1997); Restatement (Third) of the Law Governing Lawyers § 76 cmt. d.

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privilege applies, it protects not only the communications between any of the clients and attorneys
regardless of whether the communicating client’s own attorney is present but also the
communications between any of the clients’ respective attorneys. United States v. Schwimmer, 892
F.2d at 244; Bank of Brussels Lambert v. Credit Lyonnais Swisse, S.A., 160 F.R.D. 437, 446
(S.D.N.Y. 1995); In re Monsanto Co., 998 S.W.2d 917, 922 (Tex. App. 1999).

Although originally limited to cases involving actual co-defendants, the courts now routinely
apply the common interest privilege to potential co-defendants, In re Grand Jury Subpoenas, 89-3
& 89-4, John Doe 89-129, 902 F.2d at 249; Schachar v. American Acad. of Ophthalmology, Inc.,
106 F.R.D. 187, 191 (N.D. Ill. 1985), and others who have a community of interest in the subject
matter of the communications. Attorney-Client Privilege in the United States § 4:35, at 201.
However, the privilege applies only to communications given in confidence, United States v.
Weissman, 195 F.3d 96, 99 (2d Cir. 1999), and intended and reasonably believed to be part of an on-
going and joint effort to set up a common legal strategy. United States v. Schwimmer, 892 F.2d at
243; In re Bevill, Bresler & Schulman Asset Mgt. Corp., 805 F.2d 120, 126 (3d Cir. 1986); Griffith
v. Davis, 161 F.R.D. 687, 692 n.6 (C.D. Cal. 1995); Bass Pub., Ltd. v. Promus Companies, Inc., 868
F. Supp. 615, 621 (S.D.N.Y. 1994).

The proponent of the common interest privilege has the burden of establishing the necessary
elements of the privilege. In re Grand Jury Proceedings, 156 F.3d 1038, 1042-43 (10th Cir. 1998);
United States v. Evans, 113 F.3d at 1467; United States v. Moss, 9 F.3d 543, 550 (6th Cir. 1993).
To carry its burden, the proponent must demonstrate: (1) that the otherwise privileged information
was disclosed due to actual or anticipated litigation, (2) that the disclosure was made for the purpose
of furthering a common interest in the actual or anticipated litigation,16 (3) that the disclosure was
made in a manner not inconsistent with maintaining its confidentiality against adverse parties, and
(4) that the person disclosing the information has not otherwise waived its attorney-client privilege
for the disclosed information. In re Sealed Case, 29 F.3d 715, 719 n.5 (D.C. Cir. 1994); United
States v. Bay State Ambulance & Hosp. Rental Servs., Inc., 874 F.2d 20, 28 (1st Cir. 1989); In re
Bevill, Bresler & Schulman Asset Mgt. Corp., 805 F.2d at 126; Travelers Cas. & Sur. Co. v. Excess
Ins. Co., 197 F.R.D. 601, 606 (S.D. Ohio 2000); Restatement (Third) of the Law Governing Lawyers
§ 76(1).

The common interest privilege is not limited to communications and documents generated
during the period of time when persons are cooperating on a common defense. It also includes pre-
existing confidential communications and documents that are shared during the common enterprise.
In re Grand Jury Subpoenas 89-3 & 89-4, John Doe 89-129, 902 F.2d at 249-50. Accordingly, when
a party invokes the common interest privilege, the court must focus on the circumstances
surrounding the disclosure of the communications or documents rather than on when
communications or documents were generated. Attorney-Client Privilege in the United States §
4:38, at 238.

16
The cooper ation requ ired to invo ke the co mmo n interest priv ilege mu st be mo re than cooperation for
business purposes or to address a common problem. The cooperation must be in the furtherance of a joint strategy for
actual or anticipa ted litigation. United States v. Weissman, 195 F.3 d at 100 ; Walsh v. Northrup Grumman Corp., 165
F.R.D. 16, 19 (E.D.N.Y. 1996); Medcom Holding Co. v. Baxter Travenol Lab., 689 F. Supp. 841, 845 (N.D . Ill. 1988).

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 C.

The April 17, 2000 order offers little insight into the trial court’s reasons for refusing to
permit Comdata to invoke the common interest privilege.17 There are, however, only two
possibilities. First, the trial court could have concluded that Comdata failed to carry its burden of
proof regarding the elements of the privilege. Second, it could have concluded that Comdata was
not entitled to invoke the common interest privilege because Comdata and IPS never actually signed
the proposed Joint Defense Agreement their lawyers had been negotiating.

The trial court’s decision, to the extent it rests on the conclusion that Comdata did not carry
its burden of proof, is based on a clearly erroneous assessment of the evidence. The only evidence
regarding the circumstances surrounding Comdata’s and IPS’s negotiations over the Joint Defense
Agreement was provided by one of the lawyers actually representing Comdata in this litigation. In
an affidavit18 dated March 10, 2000, the lawyer explained:

5. In the beginning of the drafting process, it was
contemplated that there would be two (2) separate agreements: 1) an
agreement for the retransfer of the note from Comdata to IPS and 2)
a defense agreement whereby IPS would provide a defense to
Comdata in the pending action. For most of the negotiations, the two
(2) agreements were jointly discussed and it was assumed that they
would be executed contemporaneously with one another. For the
most part, the Joint Defense Agreement was proposed and discussed
between myself, as attorney for Comdata, and the attorney for IPS.
Occasionally, general counsel for Comdata and/or my partner,
Kenneth M. Bryant, participated in the discussions. In general terms,
these drafts set forth how the defense of the plaintiffs’ lawsuit was
going to be handled, including areas of defense strategy wherein
Comdata and IPS shared common interests and goals. These drafts
also relay communications from Comdata and contain my hand-
written notes. The text of these drafts and my notes together reflect
my legal theories of the defense, opinions about the case, and other

17
The trial court made no findings of fact or conclusions of law regarding this issue.

18
An affidavit of an attorney is an appropriate way to provide the evidence needed to support a common
interest privilege c laim. Law yers, as offic ers of the co urt, are held to the utm ost good faith in the d ischarge o f their
duties. White v. McBride, 937 S.W.2d 796, 802 (Tenn. 1996). Accordingly, the courts accept affidavits from lawyers
as sufficient to in voke atto rney-clien t privilege an d the wo rk prod uct doctrine. State v. Bobo, 724 S.W.2d 760, 765
(Tenn. Crim. App. 1981) (attorney-client privilege); Arnold v. City of Chattanooga, 19 S.W.3d 779, 784 (Tenn. Ct. App.
1999) (work product doctrine). Extending the application of this evidentiary device to the common interest privilege
is logical since the common in terest privilege is nothing more than an extension of the scope of the attorney-client
privilege. Other co urts have likewise ap proved the use of a ffidavits. See, e.g., Royal Surplus Lines Ins. Co v. Sofamor
Danek Group, Inc., 190 F.R .D. 463 , 473 (W .D. Ten n. 1998 ); Chan v. City of Chicago, 162 F.R.D. 344, 345-46 (N.D.
Ill. 1995); Visual Scene, Inc. v. Pilkington Bros, PLC, 508 So.2d at 441.

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 thought processes and mental impressions. My thoughts and opinions
on behalf of Comdata were shared with only attorneys for IPS with
the intent they remain confidential, and with the understanding and
presumption that Comdata and IPS would be cooperating fully in
defending plaintiffs’ claims that were common to both companies.
At all times material hereto, it was recognized that IPS, as well as
Comdata, might be a party litigant. It was also recognized that
Comdata and IPS would have common interests against the plaintiffs,
as adversary parties in litigation.

6. Comdata and IPS could not reach final agreement on
the defense agreement, but on or about November 15, 1999, they did
agree on the Note Purchase Agreement. As attorney for Comdata, I
represented Comdata in these negotiations and prepared and edited
the drafts of the Note Purchase Agreement and defense agreement.
These drafts were prepared with this particular lawsuit in mind and
with the understanding that IPS could become a party litigant in this
action.

This excerpt supplies all the ingredients needed to invoke the common interest privilege.
When the lawyer filed his affidavit, IPS was not yet a party to the lawsuit, but both Comdata and IPS
contemplated that IPS would become a party if it acquired the promissory note and associated
Guaranty Agreements from Comdata. By the time of the hearing on the motion to compel, the trial
court had permitted Mr. Boyd and the Boyd Trust to amend their complaint to add IPS as a party
defendant. Thus, by April 2000, both Comdata and IPS were actual defendants and were facing
common legal claims seeking the rescission of the Guaranty Agreements, restitution of $50,000, and
other unspecified damage claims. The circumstances surrounding the discussions of the proposed
Joint Defense Agreement make it equally clear that the lawyers representing Comdata and IPS
intended and reasonably believed that their communications regarding the Joint Defense Agreement
would be kept in confidence and that they made their disclosures in a way reasonably calculated to
maintain confidentiality against adverse third parties. Finally, the record contains no evidence of
conduct by either Comdata or its lawyers indicating that Comdata had waived its privilege with
regard to the communications relating to the Joint Defense Agreement.

The trial court likewise may have applied an incorrect legal standard if its decision to grant
the motion to compel hinged on the fact that Comdata and IPS ultimately did not sign the proposed
Joint Defense Agreement. The trial court overlooked that parties may assert the common interest
privilege even if they have not executed some sort of formal agreement. Katz v. AT& T Corp., 191
F.R.D. 433, 437 (E.D. Penn. 2000); Restatement (Third) of the Law Governing Lawyers § 76 cmt.
c; Attorney-Client Privilege in the United States § 4:35, at 195. While a well-drafted joint defense
agreement makes it simple for the courts to determine whether the parties intended to participate in
a joint defense, an executed agreement is not a necessary ingredient to a common interest privilege
claim. Power Mosfet Techs. v. Siemens A.G., No. 2:99CV168, 2000 U.S. Dist. LEXIS 19898, at *10
(E.D. Tex. Oct. 31, 2000).

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 The trial court also overlooked that the compelled disclosure of the existence of a joint
defense agreement is an improper intrusion into the preparation of a litigant’s case, United States v.
Bicoastal Corp., No. 92-CR-261, 1992 U.S. Dist. LEXIS 21445, at *18 (N.D.N.Y. Sept. 28, 1992),
and the joint defense agreements are themselves privileged. Waller v. Financial Corp. of Am., 828
F.2d 579, 584 (9th Cir. 1987) (warning against the disclosure of a joint defense agreement); A.I.
Credit Corp. v. Providence Washington Ins. Co., No. 96 Civ. 7955 (AGS) (AJP), 1997 U.S. Dist.
LEXIS 6223, at *12 (S.D.N.Y. May 7, 1997). Thus, while the courts may review joint defense
agreements in chambers,19 the agreements are not discoverable by other parties.

If a joint defense agreement itself is privileged, it would be anomalous to conclude that drafts
of a joint defense agreement are discoverable. Obviously, a joint defense agreement must be
preceded by negotiations regarding the terms of the agreement. Holding that communications
involving a proposed joint defense agreement are not privileged unless the parties actually enter into
a joint defense agreement will place the parties in a “Catch-22” situation and will seriously impair
efforts to negotiate a joint defense agreement. Accordingly, communications occurring during the
negotiation of a proposed joint defense agreement are privileged, even if the parties have not, or
ultimately do not, unite in a common enterprise or execute a formal agreement. Eisenberg v.
Gagnon, 766 F.2d 770, 787-88 (3d Cir. 1985) (finding that communications in an effort to establish
a joint defense are privileged); Power Mosfet Techs. v. Siemens A.G., 2000 U.S. Dist. LEXIS 19898,
at *11; Katz v. AT&T Corp., 191 F.R.D. at 437; Sig Swiss Indus. Co. v. Fres-Co Sys., USA, Inc., No.
91-0699, 1993 U.S. Dist. LEXIS 3576, at *7 (E.D. Penn. Mar. 17, 1993); Aetna Cas. & Sur. Co. v.
Certain Underwriters at Lloyd’s of London, 676 N.Y.S.2d at 733.

We have concluded that the undisputed evidence shows that the lawyers for Comdata and
IPS were negotiating the proposed joint defense agreement at a time when Comdata and IPS were
either actual or anticipated defendants in the lawsuit filed by the Boyd parties. Their
communications involved their common interest in and joint defense against claims made against
them both and occurred in circumstances reasonably anticipated to keep these communications
privileged. Even though Comdata and IPS ultimately did not sign the formal joint defense
agreement, Comdata was entitled to assert the common interest privilege with regard to the draft
agreement itself and the communications relating to this draft. Accordingly, the trial court erred
when it granted the motion to compel the production of these communications and documents.

IV.
THE PURCHASE AGREEMENT FOR PROMISSORY NOTE AND DEBT REDUCTION AGREEMENT

Comdata also takes issue with the trial court’s order compelling it to provide the Boyd parties
with all preliminary drafts of the agreement between Comdata and IPS to repurchase the Promissory
Note and Debt Reduction Agreement and the Guaranty Agreement as well as all correspondence
relating to the repurchase agreement. It asserts that the substance of these documents and the
handwritten notes and annotations on these documents are the work product of its attorney and that

19
Beneficial Franchise Co. v. Bank One, N.A., 205 F.R.D. 212, 220 (N.D . Ill. 2001); McNally Tunneling Corp.
v. City of Evanston, No. 00C6979, 200 1 U.S. Dist. LEXIS 1709 0, at *14 (N.D. Ill. Oct. 18, 2001).

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the documents should not be disclosed because they contain its attorney’s mental impressions and
opinions as well as legal theories about the case. In light of the fact that Comdata has already
produced the final version of the November 15, 1999 Purchase Agreement, we have determined that
the preliminary drafts of the agreement and the correspondence relating to these drafts are not only
work product but are also irrelevant to the subject matter involved in the pending action.

A.

The concept that an attorney’s “work product” could be shielded from pretrial discovery has
its roots in Hickman v. Taylor, 329 U.S. 495, 67 S. Ct. 385 (1947). There, the plaintiff’s attorney,
without any showing of necessity or justification, served an interrogatory on opposing counsel
requesting the written statements, private memoranda, and personal recollections of any oral
statements prepared or obtained by the lawyer in preparation for a wrongful death trial. The trial
court determined that the material sought was not protected by the attorney-client privilege and
ordered the defense attorney to comply with the interrogatory. When the attorney refused, the court
held him in contempt. The United States Supreme Court unanimously agreed that the defense
attorney should not have been convicted of contempt. Noting the “general policy against invading
the privacy of an attorney’s course of preparation [for trial],”20 the Court held that material such as
that requested by the plaintiff’s attorney need not be disclosed without some showing that the
materials sought were essential to the preparation of the requesting party’s case. Hickman v. Taylor,
329 U.S. at 511, 67 S. Ct. at 394.

The requirement in Hickman v. Taylor of a showing of “necessity or justification”21 proved
difficult to apply. The courts interpreted it as a “good cause” requirement, but there was substantial
confusion and disagreement over whether the requirement could be satisfied by a showing of
relevance and lack of privilege or whether it required an additional showing of necessity. The courts
generally required more than a showing of relevance and lack of privilege. Fed. R. Civ. P. 26,
committee note of 1970, reprinted in, 6 James W. Moore et al., Moore’s Federal Practice §
26App.05[2] (Matthew Bender Authority Federal Practice CD-ROM, rel. 26, Dec. 2001) (“Moore’s
Federal Practice”); Federal Practice and Procedure § 2023, at 327.

In 1970, twenty-three years after Hickman v. Taylor, Fed. R. Civ. P. 26 was broadened to
cover all pretrial discovery.22 One of the 1970 amendments, Fed. R. Civ. P. 26(b)(3), specifically
addressed the discovery of trial preparation materials and codified the work product doctrine first
recognized in Hickman v. Taylor. Fed. R. Civ. P. 26(b)(3) attempted to strike a balance between the

20
Hickman v. Taylor, 329 U .S. at 512, 6 7 S. Ct. at 39 4; see also M emph is Publ’g Co. v. City of Memp his, 871
S.W.2d 681, 689 (Tenn. 1994) (recognizing an “attorney’s right to conduct the client’s case with a certain degree of
privacy ”).

21
Hickman v. Taylor, 329 U.S. at 510, 67 S. Ct. at 393.

22
As originally adopted in 1937 , Fed. R. C iv. P. 26 go verned only the ta king of p retrial depo sitions and their
use at trial.

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policy of full and open discovery23 and the necessity of protecting an attorney’s preparation for trial
under the adversary system. Fletcher v. Union Pac. R.R., 194 F.R.D. 666, 670 (S.D. Cal. 2000); Zirn
v. VLI Corp., 621 A.2d 773, 782 (Del. 1993); Moore’s Federal Practice § 26.70[1]; Restatement
(Third) of the Law Governing Lawyers § 87 cmt. b.

The promulgation of Fed. R. Civ. P. 26(b)(3) had a profound effect on the scope and
application of the work product doctrine in state courts. Thirty-four states, including Tennessee,
eventually adopted the 1970 version of the rule verbatim,24 while ten other states adopted rules
containing substantially similar language. Federal Practice and Procedure § 2023, at 334-35.

The work product doctrine now applies to both civil and criminal litigation. Coe v. State, 17
S.W.3d 193, 214 (Tenn. 2000); Tenn. R. Civ. P. 26.02(3); Tenn. R. Crim. P. 16(a)(2), 16(b)(2). It
prevents litigants from taking a free ride on the research and thinking of their adversary’s lawyer.
United States v. Frederick, 182 F.3d 496, 500 (7th Cir. 1999). The doctrine embodies the policy that
attorneys, doing the sort of work that attorneys do to prepare a case for trial, should not be hampered
by the prospect that they might be called upon at any time to hand over the results of their work to
their adversaries. Duplan Corp. v. Moulinage et Retorderie de Chavanoz, 487 F.2d 480, 482-83 (4th
Cir. 1973); Downing v. Bowater, Inc., 846 S.W.2d 265, 267 (Tenn. Ct. App. 1992) (quoting In re
Murphy, 560 F.2d 326, 334 (8th Cir. 1977)). Lawyers preparing for litigation should be permitted
to assemble information, to separate the relevant facts from the irrelevant, and to use the relevant
facts to plan and prepare their strategy without undue and needless interference. Wells v. Liddy, No.
01-1266, 2002 U. S. App. LEXIS 3356, at *30 (4th Cir. Mar. 1, 2002).

B.

Like its federal counterpart, the standards and procedures for addressing a claim of work
product are provided in Tenn. R. Civ. P. 26.02(3). The rule suggests sequential steps with shifting
burdens of proof that litigants and courts should follow when considering work product doctrine
claims. Hendrick v. Avis Rent A Car Sys., 916 F. Supp. 256, 260 n.3 (W.D.N.Y. 1996); In re Air
Crash Disaster at Detroit Metro. Airport, 130 F.R.D. 641, 644 (E.D. Mich. 1989). The explanation
of these steps in Toledo Edison Co. v. G A Techs., Inc., 847 F.2d 335, 339-40 (6th Cir. 1988) reflects
the approach generally taken by the courts. Daisy H. Floyd, A “Delicate and Difficult Task”:

23
The same broad policy favoring the discovery of relevant, n on-priv ileged m aterial is reflected in Tenn. R.
Civ. P. 26.02 (1). Pettus v. Hurst , 882 S.W.2d 783, 786 (Tenn. Ct. App . 1993); Duncan v. Duncan, 789 S.W.2d at 560.

24
While Tenn. R. Civ. P. 26.02(3) is identical to Fed. R. Civ. P. 26(b)(3), Tenn. R. Civ. P. 26 differs from its
federal counterpart in several material respects. For example, Tennessee does did not adopt Fed. R. Civ. P. 26(b)(2)
permitting the discovery of the existence and contents of insurance policies. Tennessee has also not adopted the 2000
amendment to Fed. R. Civ. P. 26(b)(1) that alters the scope of discovery as a matter of right without court authorization.
While Tenn. R. Civ. P. 2 6.02(1) permits the discovery of any non-privileged matter “which is relevant to the subject
matter involved in the pending action,” Fed. R. Civ. P. 26(b)(1) now limits discovery without court approval to any non-
privileged matter tha t is “relevant to the claim o r defense of any p arty.” As a result of the 2000 amendment to Fed. R.
Civ. P. 26(b)( 1), discov ery of m atters relevan t to the subject matter involved in the pending action can only be obtained
by cou rt order up on the sh owing of good cause. Federal Practice and Procedure § 2008 , at 14-15 (Supp. 2 001).

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Balancing the Competing Interests for Federal Rule of Evidence 612, the Work Product Doctrine,
and the Attorney-Client Privilege, 44 Buffalo L. Rev. 101, 110-11 (1996).

In usual circumstances, discovery will begin when a party sends to an opposing party a
request for discovery using one of the methods identified in Tenn. R. Civ. P. 26.01. If the party
receiving the request for discovery believes that some or all of the requested documents are covered
by the work product doctrine, that party need only notify the requesting party that it is declining to
provide some or all of the requested documents based on the work product doctrine. At this point,
if the party seeking discovery insists on obtaining the withheld documents, it may move for an order
pursuant to Tenn. R. Civ. P. 37.01 to compel discovery. Federal Practice and Procedure § 2023,
at 344.

At this juncture, the party seeking discovery, as the party seeking an order compelling
discovery under Tenn. R. Civ. P. 37.01, has the burden of establishing that it is entitled to discover
the documents or other materials withheld by its adversary. To carry its burden, the party seeking
discovery must establish (1) that the material being sought is relevant to the subject matter involved
in the pending action,25 (2) that the material being sought is not otherwise privileged,26 and (3) that
the material being sought consists of documents or other tangible things.27 Toledo Edison Co. v. G
A Techs., Inc., 847 F.2d at 339. Infosystems, Inc. v. Ceridian Corp., 197 F.R.D. 303, 306 (E.D.
Mich. 2000); Miller v. Federal Express Corp., 186 F.R.D. 376, 387 (W.D. Tenn. 1999).

Once the party seeking discovery makes a prima facie showing that the materials it seeks are
discoverable, the burden shifts to the party opposing discovery to show that the materials are work
product protected by Tenn. R. Civ. P. 26.02(3). Hammock v. Sumner County, No. 01A01-9710-CV-
00600, 1997 WL 749461, at *2 (Tenn. Ct. App. Dec. 5, 1997) (No Tenn. R. App. P. 11 application
filed).28 To invoke the work product doctrine successfully, a party must, in the words of Tenn. R.
Civ. P. 26.02(3), establish (1) that the materials sought are documents or tangible things, (2) that the
documents were prepared in anticipation of litigation or for trial, (3) that the documents were
prepared by or for another party or by or for that other party’s representative. Caremark, Inc. v.
Affiliated Computer Servs., Inc., 195 F.R.D. 610, 613 (N.D. Ill. 2000); Kidwiler v. Progressive
Paloverde Ins. Co., 192 F.R.D. 536, 542 (N.D.W. Va. 2000); Moore’s Federal Practice § 26.70[5].

25
Tenn. R. Civ. P. 26.02(1) & 26.02(3 ). Relevan cy is extrem ely imp ortant at the d iscovery stage. Vythoulkas
v. Vanderbilt Univ. Hosp., 693 S.W.2d 350, 35 9 (Tenn . Ct. App . 1985); Federal Practice and Procedure § 2008, at 99.
How ever, it is more loosely construed during discovery than it is at trial. The phrase “relevant to the subject matter
involved in the pen ding actio n” has be en cons trued “br oadly to encom pass any matter tha t bears on , or that reaso nably
could lead to other matter that could bear on, any issue that is or may b e in the case .” Oppenheimer Fund, Inc. v.
Sanders , 437 U .S. 340, 3 51, 98 S . Ct. 2380 , 2389 (1 978); Hickman v. Taylor, 329 U .S. at 501, 6 7 S. Ct. at 38 8.

26
Tenn. R. Civ. P. 26.02(1) & 26 .02(3).

27
Tenn. R. Civ. P. 26.02(3).

28
See also Resolution Trust Corp. v. Dabney, 73 F.3d 262, 266 (10th Cir. 1 995) (h olding th at the party
asserting work product protection has the burden of establishing that the doctrin e applies); Hodges, Grant & Kaufmann
v. United States, 768 F.2d 719, 721 (5th Cir. 1985); Taylor v. Temple & Cutler, 192 F.R.D. 552, 557 (E.D . Mich. 1999);
Pina v. Espinoza , 29 P .3 d 10 6 2, 10 6 9 (N .M . Ct. App. 2001); Moore’s Federal Practice § 26.70[5][a]; Epstein, at 491.

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The party asserting the doctrine must also demonstrate that it has not waived its protection with
regard to the documents being sought. Amgen, Inc. v. Hoechest Marion Rousel, Inc., 190 F.R.D.
287, 289 (D. Mass. 2000). Parties asserting the work product doctrine are not required to spell out
(1) the names and positions of the authors of the documents, (2) their responsibility in connection
with the litigation, (3) the dates the documents were prepared, or (4) to whom the documents have
been disclosed. Toledo-Edison Co. v. G A Techs., Inc., 847 F.2d at 341.

Once the party opposing discovery establishes that the requested material is work product,
the burden shifts back to the requesting party to establish that it is nonetheless entitled to the
material. Epstein, at 492. The nature and extent of this burden depends upon whether the material
is “ordinary” or “fact” work product or “opinion” work product. Ordinary or fact work product
consists of documents prepared in anticipation of litigation or for trial that do not contain the mental
impressions, conclusions, opinions, or legal theories of an attorney or other representative of a party
in the litigation. Pacamor Bearings, Inc. v. Minebea Co., 918 F. Supp. 491, 512 (D.N.H. 1996);
Moore’s Federal Practice § 26.70[5][b]. Opinion work product includes documents containing an
attorney’s mental impressions, conclusions, opinions, or legal theories regarding the pending
litigation. Pittman v. Frazer, 129 F.3d 983, 988 (8th Cir. 1997); Restatement (Third) of the Law
Governing Lawyers § 87(2).

To obtain ordinary or fact work product, the requesting party must establish (1) that it has
a substantial need for the materials and (2) that it is unable to obtain these materials or their
substantial equivalent by other means without undue hardship. Tenn. R. Civ. P. 26.02(3); In re
Perrigo Co., 128 F.3d 430, 437 (6th Cir. 1997); In re Grand Jury Proceedings, 33 F.3d 342, 348
(4th Cir. 1994); Miller v. Federal Express Corp., 186 F.R.D. at 387; Beard v. Middle Tenn. Home
Health Serv., 144 F.R.D. 340, 342 (E.D. Tenn. 1992). The basis for the claim of “substantial need”
must be articulated with specificity. In re Grand Jury Investigation (Sun Oil), 599 F.2d 1224, 1232
(3d Cir. 1979); Delco Wire & Cable, Inc. v. Weinberger, 109 F.R.D. 680, 689-90 (E.D. Pa. 1986);
Epstein, at 550. As a general matter, the party seeking discovery must establish that the facts in the
requested documents are essential elements of its prima facie case. Moore’s Federal Practice §
26.70[5][c].29

The burden of establishing a need for opinion work product is more onerous than that for
ordinary or fact work product. Holmgren v. State Farm Mut. Auto. Ins. Co., 976 F.2d 573, 577 (9th
Cir. 1992). The United States Supreme Court has emphasized that the essential purpose of the work
product doctrine is to protect an attorney’s mental processes, Department of Interior v. Klamath
Water Users Protective Ass’n, 532 U.S. 1, 8, 121 S. Ct. 1060, 1065 (2001), and that work product
revealing an attorney’s mental processes is “deserving of special protection.” Upjohn Co. v. United
States, 449 U.S. 383, 400, 101 S. Ct. 677, 688 (1981). While the Court has, thus far, declined to
hold that opinion work product is never discoverable, it has held that parties seeking opinion work
product must make a “far stronger showing of necessity and unavailability by other means” than is

29
Such documents include statements of witnesses who are unavailable due to absence, serious illness, or death.
Restatement (Third) of the Law Governing Lawyers § 88 cmt. b.

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required when seeking ordinary or fact work product. Upjohn Co. v. United States, 449 U.S. at 401-
02, 101 S. Ct. 688-89.

The courts have not defined precisely when revealing opinion work product is warranted.
A majority of courts have pointed out that it enjoys a nearly absolute immunity from disclosure,
Baker v. General Motors Corp., 209 F.3d 1051, 1054 (8th Cir. 2000); Chaudhry v. Gallerizzo, 174
F.3d 394, 403 (4th Cir. 1999); Director, Office of Thrift Supervision v. Vinson & Elkins, LLP, 124
F.3d 1304, 1308 (D.C. Cir. 1997); P. & B. Marina, Ltd. P’ship v. Logrande, 136 F.R.D. 50, 57
(E.D.N.Y. 1991), and that it is subject to discovery only in rare, extraordinary circumstances.
Hickman v. Taylor, 329 U.S. at 513, 67 S. Ct. at 395; Gundacker v. Unisys Corp., 151 F.3d 842, 848
(8th Cir. 1998); In re Sealed Case, 856 F.2d 268, 273 (D.C. Cir. 1988); Restatement (Third) of the
Law Governing Lawyers § 89. These circumstances include those in which the litigation itself or
one of the litigants puts the attorney’s work product at issue by asserting claims or defenses based
on the “advice of counsel,” by calling an attorney as an expert witness, or another circumstance in
which an attorney’s conduct is a central issue in a case. Epstein, at 574 & 589; Restatement (Third)
of the Law Governing Lawyers § 92.

C.

We now turn to the discovery of the drafts of the Purchase Agreement executed on November
15, 1999, and the correspondence between the lawyers for Comdata and IPS relating to this
agreement. We have determined that the trial court erred by ordering Comdata to provide these
documents to the Boyd parties for four reasons. First, the Boyd parties failed to establish that the
requested documents contained information that is relevant to the subject matter involved in this
action. Second, Comdata established that the requested documents contain opinion work product.
Third, Comdata demonstrated that it has not waived the confidentiality of these documents. Finally,
the Boyd parties have failed to demonstrate that this case involves one of the rare circumstances
warranting the discovery of opinion work product.

1.
The Relevance of the Requested Documents

Two agreements executed on January 15, 1998 are at the heart of this litigation – the
Marketing Services Agreement and the Guaranty Agreement obligating the Boyd parties to pay
Fidelity General’s and Sovryn’s debt in the event of default.30 Comdata and IPS claim that the Boyd
parties must honor their guaranty agreement because Fidelity Group and Sovryn defaulted on the
Promissory Note and Debt Reduction Agreement. For their part, the Boyd parties assert that they
should be excused from their guaranty obligations because Comdata breached the Marketing

30
The Promissory Note and Debt Reduction Agreement was also executed on January 15, 1998. While it plays
an imp ortant role in this case, its role is not as pivotal as the other two contracts signed on January 15, 1 998 becau se
there appears to be little argum ent that Fide lity Group and Sovryn defaulted on the promissory note by failing to reduce
the debt as agreed.

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Services Agreement and made material misrepresentations regarding its intended performance under
this agreement.

With the case in this posture, Tenn. R. Civ. P. 26.02(1) placed the initial burden on the Boyd
parties to establish that the requested documents contained information relevant to (1) Comdata’s
obligations under the Marketing Services Agreement, (2) Comdata’s representations that induced
the Boyd parties to approve the assignment of the contracts to Comdata and to sign the Guaranty
Agreement, and (3) the Boyd parties’ obligations under the Guaranty Agreement. The Boyd parties
have not carried this burden.

The rights and obligations of the parties to a written contract are governed by the terms of
the contract, Hillsboro Plaza Enters. v. Moon, 860 S.W.2d 45, 47 (Tenn. Ct. App. 1993), not by the
parties’ statements during their negotiations or drafts of the final contract. Faithful v. Gardner, 799
S.W.2d 232, 235 (Tenn. Ct. App. 1990) (holding that the existence of a written contract gives rise
to the presumption that the parties have reduced their prior agreements to writing); GRW Enters.,
Inc. v. Davis, 797 S.W.2d 606, 610 n.2 (Tenn. Ct. App. 1990) (stating that negotiations and
agreements are deemed to be integrated into a written contract when the parties intend the contract
to be a complete expression of their agreement). Thus, a court’s role is to enforce an unambiguous
contract as it is written unless the contract is being challenged based on fraud or mistake. Wills &
Wills, L.P. v. Gill, 54 S.W.3d 283, 286 (Tenn. Ct. App. 2001). When called upon to enforce a
written contract, the court must avoid favoring either party, Marshall v. Jackson & Jones Oils, Inc.,
20 S.W.3d 678, 682 (Tenn. Ct. App. 1999), and must avoid relieving either party of their contractual
obligations simply because these obligations have turned out to be burdensome. Realty Shop, Inc.
v. RR Westminster Holding, Inc., 7 S.W.3d 581, 597-98 (Tenn. Ct. App. 1999).

The Boyd parties’ contractual rights and obligations with regard to Comdata and IPS are
governed by the January 15, 1998 Consent to Assignment and Release and the three other contracts
executed on January 15, 1998. Their breach of contract claim against Comdata hinges on the
Marketing Services Agreement. The extent of their obligation to guarantee Fidelity Group’s and
Sovryn’s debt is controlled by the Guaranty Agreement. Finally, their claims for rescission,
restitution, unjust enrichment, and fraudulent inducement to contract all hinge on Comdata’s
representations prior to mid-January 1995 regarding its anticipated performance obligations under
the Marketing Services Agreement.

The instruments that provide the foundation for all the claims and counterclaims in this case
were executed on or before January 17, 1998. The scope of the parties’ rights and obligations
depends on the language of these contracts, not upon whether Comdata or IPS currently owns these
contracts. While Comdata and IPS executed a Purchase Agreement on November 15, 1999
transferring the contracts to IPS, neither of the Boyd parties were parties to this contract.
Accordingly, as a matter of law, the November 15, 1999 Purchase Agreement between Comdata and

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IPS could not modify the rights and obligations that had already been created by the three contracts
executed approximately one year earlier.31

Even though the Purchase Agreement did not modify the parties’ rights and obligations under
the Consent to Assignment and Release and the three January 15, 1998 contracts, it could
conceivably be argued that the agreement affected the Boyd parties’ ability to pursue their claims
against either Comdata, IPS, or both. Any such argument, however, must necessarily be based on
the terms of the November 15, 1999 agreement, not on the parties’ negotiations or the preliminary
drafts of this agreement. Accordingly, the drafts of the November 15, 1999 Purchase Agreement and
the correspondence between the lawyers for Comdata and IPS regarding the terms of this agreement
could not, as a matter of law, affect the Boyd parties’ ability to pursue their claims or present their
defenses.32

The Boyd parties have failed to demonstrate how the drafts of the Purchase Agreement and
the correspondence between Comdata and IPS are relevant to the subject matter involved in this
action. Trial courts should deny motions to compel the discovery of documents when the moving
party has failed to demonstrate that the requested documents satisfy Tenn. R. Civ. P. 26.02(1)’s
standards. American Tel. & Tel. Co. v. Cardwell, 798 S.W.2d 761, 762 (Tenn. 1990) (reversing an
order compelling the discovery of irrelevant documents); Price v. Mercury Supply Co., 682 S.W.2d
924, 936 (Tenn. Ct. App. 1984) (affirming an order denying a motion to compel discovery of
irrelevant documents). Accordingly, the trial court incorrectly applied Tenn. R. Civ. P. 26.02(1)’s
standards when it granted the Boyd parties’ motion to compel the production of the disputed
documents.

2.
The Requested Documents Contained Opinion Work Product

Had the Boyd parties made the threshold showing that the drafts of the Purchase Agreement
and the correspondence relating to these drafts satisfied the discoverability requirements in Tenn.
R. Civ. P. 26.02(1), the burden would have shifted to Comdata to establish that these materials were
work product. Comdata carried its burden. It is undisputed that the requested materials were
documents – drafts of the Purchase Agreement and copies of the correspondence between Comdata
and IPS relating to this agreement. It is also undisputed that these documents were prepared in

31
Comdata, presumably w ith IPS’s approv al, has provided a copy of the N ovemb er 15, 1999 Purchase
Agreement to the Boyd parties, and thus a copy of this contract appears in the record as an exhibit to the first amended
comp laint. No provision in this agreement purpor ts to modify any of the provisions in the instruments executed on or
before January 17, 1998.

32
In fact, Paragraph 6 of the final Purchase Agreement states that IPS is n ot assum ing any obligation or liability
that Comdata may have, including those arising from the Marketing Services Agreement. Accordingly, as a matter of
fact, the Purchase Agreement does not impair the Boyd parties’ ability to proceed directly against Comdata.

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response to the litigation commenced by the Boyd parties33 and that they were prepared by the
attorneys for a party to the litigation and the attorneys for a company that was soon to be a party.

The drafts of the Purchase Agreement sought by the Boyd parties also contain Comdata’s
communications to its attorneys and handwritten notations and comments containing, in the words
of one of Comdata’s attorneys, “[his] thought processes, mental impressions, conclusions, opinions,
and legal theories about this lawsuit.” According to Comdata’s attorney, the draft documents, even
with his handwritten notations redacted, “would, in all probability . . . disclose [my] mental
impressions . . . including an identification of some issues to be involved in this case.”

The courts have not hesitated to give work product protection to an attorney’s handwritten
notes or comments prepared in anticipation of, or in preparation for, litigation. These notations and
comments qualify as opinion work product if they reflect the attorney’s “mental impressions,
conclusions, opinions, or legal theories” even if they appear on documents that would be otherwise
discoverable. Lawrence v. Cohn, No. 90 Civ 2396 (CSH)(MHD), 2002 U. S. Dist. LEXIS 1222, at
*2-3 (S.D.N.Y. Jan. 25. 2002) (determining that an attorney’s handwritten notations on an executed
limited partnership agreement were work product); Snowden v. Connaught Labs., Inc., 137 F.R.D.
325, 332 (D. Kan. 1991) (determining that an attorney’s handwritten notations on copies of publicly
filed court documents were work product).

The courts have likewise determined that draft documents prepared by attorneys in
anticipation of, or in preparation for, litigation are work product if they contain information or
comments not included in the final version of the document. Andritz Sprout-Bauer, Inc. v. Beazer,
Inc., 174 F.R.D. 609, 633 (M.D. Pa. 1997); Union Carbide Corp. v. Dow Chem. Co., 619 F. Supp.
1036, 1050-51 (D. Del. 1985). An intention to disclose the document in its final form to third
persons does not undermine its status as work product prior to disclosure. In re Grand Jury
Subpoena Duces Tecum Dated Sept. 15, 1983, 731 F.2d 1032, 1037 (2d Cir. 1984); Muller v. Walt
Disney Prods., 871 F. Supp. 678, 682 (S.D.N.Y. 1994); see also In re Grand Jury Subpoena for
Documents in the Custody of Bekins Storage Co., 460 N.Y.S.2d 684, 691 (N.Y. Sup. Ct. 1983)
(determining that drafts of partnership agreements and releases were protected by the attorney-client
privilege). Thus, even drafts of settlement agreements have been found to be work product because
they involve the mental processes of the attorneys involved in their preparation. N.V. Organon v.
Elan Pharmaceuticals, Inc., No. 99 Civ. 11674 (JGK)(RLE), 2000 U.S. Dist. Ct. LEXIS 5629, at
*5-6 (S.D.N.Y. May 1, 2000); In re Subpoena Duces Tecum Served on Rosenman & Colin, No. M8-
85 (RLE), 3:92 CV.00301 (WWE), 1996 U.S. Dist. LEXIS 13590, at *14 (S.D.N.Y. Sept. 16, 1996).

33
The work product doctrine does not protect docum ents prepared in th e regular course of busine ss. Simon
v. G.D. Searle & Co., 816 F.2d 397, 401 (8th Cir. 1987); Colum bia/HC A Hea lthcare Co rp. v. Eigh th Judicia l Dist. Ct.,
936 P.2d 84 4, 526-2 7 (Nev . 1997); Cook v. W ake Coun ty Hosp. Sys. , 482 S.E.2d 546, 623 (N.C. Ct. App. 1997);
Federal Practice and Procedure § 2024, at 346. However, one of Comdata’s attorneys filed an affidavit stating that
the drafts of the Purchase Agreement and the related correspondence were prepared after this lawsuit was filed and “with
this particular lawsuit in mind.” The record contains absolutely no evidence that Comdata or IPS would have entered
into the November 15, 1999 Purchase Agreement or some other similar agreement had this suit not been filed.
According ly, the Purchase A greemen t was not prepa red in the regular co urse of business.

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 In cases of this sort, it would be preferable for the trial court to examine the contested
documents in chambers rather than relying solely on the lawyers’ characterizations of the contents
of the documents.34 However, this oversight is not material in this case. The affidavit submitted by
Comdata’s attorney provides adequate support for the conclusion that the drafts of the Purchase
Agreement containing the notations of counsel and the related correspondence contain opinion work
product.

3.
Comdata Did Not Waive the Confidentiality of the Withheld Documents

Even if the contested documents contain opinion work product, they would have been
discoverable if Comdata had waived the confidentiality of the documents by making some
testimonial use of them.35 Litigants may not use the work product doctrine as a sword and a shield.
Arnold v. City of Chattanooga, 19 S.W.3d at 787. Thus, they may not selectively disclose a
protected document to prove a point and then invoke the work product doctrine to prevent their
opponent from challenging their assertion. Frontier Ref., Inc. v. Gorman-Rupp Co., 136 F.3d at 704;
Granite Partners, L.P. v. Bear, Stearns & Co., 184 F.R.D. 49, 54 (S.D.N.Y. 1999); Moore’s Federal
Practice § 26.70[6][c].

The draft documents and handwritten notes and comments prepared by Comdata’s attorneys
are clearly work product to the extent that they were circulated among only Comdata and its
attorneys. However, Comdata’s attorney appears to have shared the drafts of the Purchase
Agreement, and perhaps even his handwritten notes and comments, with the attorneys representing
IPS. He states in his affidavit that “I made these notes and revised and edited the text of the
Agreement and the proposed defense agreement in consultation with attorneys for IPS at a time when
both Comdata and IPS had a common interest in defending this lawsuit and did so with the intention
that these communications remain confidential.”

We have determined Comdata’s attorneys’ disclosure of their work product to the attorneys
representing IPS was not a waiver of the confidentiality of the shared documents. These disclosures
did not amount to a testimonial use of the documents, and when the disclosures occurred, Comdata

34
United States v. Henke, 222 F.3 d 633, 6 42-43 (9th Cir. 20 00); In re Steeg, 112 F.3d 173, 174 (5th Cir. 1997);
McKinnon v. Smock, 445 S.E.2d 526, 52 8 (Ga. 19 94); Ocean S pray Cranb erries, Inc. v. Holt Cargo Sys., 785 A.2d 955,
958 (N.J. Super. Ct. L . Div. 200 0); Baliva v. State Farm Auto. Ins. Co., 713 N.Y.S.2d 376, 377 (App. Div. 2000).
However, the decision whether to cond uct an in ca mera re view of docum ents claim ed to be w ork pro duct is
discretionary. United S tates v. Zolin , 491 U .S. 554, 5 72, 109 S. Ct. 2619, 2631 (1989) ; In re Colorado v. Martinez, 970
P.2d 469, 47 7 (Colo . 1998); State v. Vinson, 591 N .E.2d 33 7, 343 (O hio Ct. A pp. 199 0). Accordingly, a court does not
abuse its discretion b y declinin g to review docum ents in camera when other evidence is sufficient to provide a basis for
the court’s de cision. In re George, 28 S.W.3d 511, 51 9 n.4 (T ex. 200 0); Enron Oil & Gas Co. v. Flores, 810 S.W.2d
408, 41 3 (Tex. A pp. 199 1); Barry v. USAA, 989 P.2d 1172, 1176 (Wash. Ct. App. 1999).

35
Work produc t protectio n can be waived. Restatement (Third) of the Law Governing Lawyers § 91.
However, unlike the attorney-client privilege, the work product doctrine is not waived by mere disclosure but instead
by making a testimon ial use of the protected material. United States v. Nobles, 422 U.S. 225, 239 n.14, 95 S. Ct. 2160,
2171 n.14 (1975) ; Wells v. Liddy, 2002 U.S. App. LEXIS 3356, at *31; Federal Election Comm’n v. Christian Coalition,
178 F.R .D. 61, 76 (E.D. V a. 1998 ).

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and IPS were pursuing a common interest in mounting a joint defense against the claims of the Boyd
parties. Accordingly, the common interest privilege attached to their communications and permitted
the attorneys for the parties to communicate on matters of common interest without waiving the
confidentiality of the communications.

The record contains no evidence that either Comdata or IPS shared the drafts of the Purchase
Agreement or their correspondence regarding this agreement with third parties. Neither Comdata
nor IPS has undertaken to use these documents as a sword in this litigation. Therefore, there is no
basis for concluding that Comdata or its attorneys have waived the work product protection of these
documents.

4.
No Heightened Showing of Necessity or Unavailability

Once Comdata established that the requested documents contained opinion work product,
the burden shifted back to the Boyd parties to demonstrate that this case involves one of the rare
circumstances warranting the discovery of opinion work product. To carry this burden, the Boyd
parties were required to make a heightened showing that they have a substantial need for the
documents and that they are unable to obtain the same or comparable information through other
means without undue hardship. At no point in these proceedings have the Boyd parties explained
how these documents are necessary.

The Boyd parties have never satisfactorily explained how the drafts of the Purchase
Agreement and the related correspondence between Comdata and IPS are relevant to the subject
matter of this litigation. In light of their inability to clear this most basic of hurdles, it is not
surprising that they are unable to articulate how these documents will materially assist them in
establishing the essential elements of their prima facie case. After all, irrelevant documents are, by
definition, not essential to a party’s ability to prove its claims or defenses. The work of Comdata’s
attorneys has not become a central issue in this litigation. Accordingly, the trial court erred by
ordering Comdata to produce these documents because the Boyd parties did not carry their burden
of establishing that the documents were essential to their case.

V.

The Boyd parties have failed to demonstrate that they are entitled to discover either the draft
joint defense agreement, the drafts of the November 15, 1999 Purchase Agreement, or the
correspondence between the attorneys for Comdata and IPS regarding these agreements.
Accordingly, the trial court, either by erroneously assessing the evidence or by erroneously applying
the correct legal principles, erred by ordering Comdata to provide these documents to the Boyd
parties. Therefore, we reverse the April 17, 2000 order compelling Comdata to produce the disputed
documents and remand the case to the trial court with directions to enter an order denying the Boyd
parties’ motion to compel the production of these documents. We tax the costs of this appeal, jointly
and severally, to Dudley E. Boyd and the Boyd Revocable Inter-Vivos Trust for which execution,
if necessary, may issue.

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 _____________________________
WILLIAM C. KOCH, JR., JUDGE

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