Having conducted an in camera review of a sampling of documents over which the attorney-client privilege had been claimed, including ex parte submissions from Reed Smith with attempts to explain why the crime-fraud exception did not apply to each of the sample documents in question, Judge Liman, sitting in the Southern District of New York, reaffirmed its previous finding based on Levona’s showing that there was probable cause to believe that a fraud was committed by Eletson on the Arbitration Panel through the withholding of documents and presentation of perjured testimony.

With respect to the specific communications reviewed over which an attorney-client privilege had been claimed: “These documents include communications regarding the drafting of an affidavit alleged to be false and misleading, responses to document production that were intended to be fraudulent and to conceal fraudulent conduct, a conversation among lawyers and client where testimony to be given and that is alleged to be false was discussed, communications regarding the recitation of facts alleged to be false, and documents concerning the concealment of fraudulent conduct after the conclusion of the arbitration.”

“‘To properly override the privilege, a court must determine whether each communication at issue was made in furtherance of a crime or fraud.’ .… Thus, to the extent that Levona asks that the Court issue a blanket order directing the production of all of the documents on the privilege log (except those from the sample the Court has found not to be subject to the crime-fraud exception), the motion is denied.”

At the same time, the Court ordered Levona and Reed Smith to attempt to meet and confer with respect to a process regarding the review of the remainder of the documents over which the privilege has been claimed and challenged, including whether the Court should retain a special master to review them.

 

Eletson Holdings v. Levona Holdings, No.23-7331 (S.D.N.Y. Sept. 19, 2025).