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First Federal Savings & Loan Association of Pittsburgh v. Oppenheim, Appel, Dixon & Co.

United States District Court for the Southern District of New York

110 F.R.D. 557 (1986)

Facts

After government-securities dealer Comark filed bankruptcy, customers who lost investments, including three savings-and-loan associations and a city (plaintiffs) sued Comark’s former auditor, Oppenheim, Appel, Dixon & Co. (OAD) (defendant). OAD impleaded Comark’s former general partners and attorneys, including general counsel Daniel Harkins and outside counsel (defendants). OAD alleged Harkins assisted in fraud by advising the partners to delay disclosing improperly commingled assets and giving regulatory officials misleading information. Harkins wanted to use attorney-client-privileged documents and testify about privileged discussions with Comark partners in his defense. A Comark partner objected, and the bankruptcy trustee asserted attorney-client privilege on Comark’s behalf, arguing Harkins had to establish the necessity of each piece of information. The court directed Harkins to submit all documents listed as privileged with an affidavit explaining the necessity of the documents and his proposed testimony for in camera review.

Rule of Law

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Issue

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Holding and Reasoning (Dolinger, J.)

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A "yes" or "no" answer to the question framed in the issue section;
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The procedural disposition (e.g., reversed and remanded, affirmed, etc.).

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