Judge Paul Gardephe
The Zwirn Entities operate hedge funds holding billions of dollars in assets. Former partner and chief financial officer Gruss was blamed for financial irregularities exposed in 2006. Following two separate internal investigations the Zwirn Entities made voluntary disclosures to the SEC. Disclosures in 2007 Power Point presentations were governed by an agreement—between the Zwirn Entities' regulatory counsel and the SEC—providing that the SEC would maintain their confidentiality. In his suit alleging contract breach and defamation a magistrate judge denied Gruss' motion to compel production of certain interview notes and summaries, which the Zwirn Entities claimed were protected by the attorney-client privilege and work-product doctrine. District court ordered production of interview notes and summaries related to 21 witnesses whose statements were disclosed to the SEC. The magistrate had erred in holding that no waiver occurred when the Zwirn Entities disclosed portions thereof to the SEC. The court found that the confidentiality agreement at issue provided no meaningful protection to the Zwirn Entities because it granted the SEC discretion to disclose the submitted materials whenever it chose to do so.
