FILED: NEW YORK COUNTY CLERK 08/24/2020 12:45 PM INDEX NO. 451685/2020 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 08/24/2020 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NEW YORK PEOPLE OF THE STATE OF NEW Index No. _____________ YORK, by LETITIA JAMES, Attorney General of the State of New Motion Sequence _______ York, (REDACTED) Petitioner, -against- THE TRUMP ORGANIZATION, INC.; DJT HOLDINGS LLC; DJT HOLDINGS MANAGING MEMBER LLC; SEVEN SPRINGS LLC; ERIC TRUMP; CHARLES MARTABANO; MORGAN, LEWIS & BOCKIUS, LLP; and SHERI DILLON, Respondents. MEMORANDUM OF LAW IN SUPPORT OF THE ATTORNEY GENERAL’S SPECIAL PROCEEDING AND APPLICATION TO COMPEL RESPONDENTS TO COMPLY WITH INVESTIGATORY SUBPOENAS LETITIA JAMES Attorney General of the State of New York 28 Liberty Street New York, NY 10005 1 of 68 FILED: NEW YORK COUNTY CLERK 08/24/2020 12:45 PM INDEX NO. 451685/2020 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 08/24/2020 TABLE OF CONTENTS TABLE OF AUTHORITIES ......................................................................................................... iii PRELIMINARY STATEMENT .....................................................................................................1 BACKGROUND .............................................................................................................................4 I. The Attorney General’s authority under Executive Law § 63(12). .....................................4 II. The Attorney General’s investigation. .................................................................................5 A. Mr. Trump’s annual financial statements. ...............................................................6 B. Seven Springs property valuation and conservation easement. ...............................6 C. 40 Wall Street. .........................................................................................................8 D. Trump International Hotel and Tower Chicago. ......................................................9 E. Trump National Golf Club – Los Angeles. ............................................................11 III. Assertions of privilege. ......................................................................................................12 A. Subpoenas to the Trump Organization. .................................................................12 B. Subpoenas to Charles Martabano...........................................................................15 C. Subpoenas to Morgan, Lewis & Bockius LLP. .....................................................18 D. Additional subpoenas issued in the course of this investigation............................20 ARGUMENT .................................................................................................................................22 I. The Trump Organization has failed to comply with the Attorney General’s subpoenas. ..........................................................................................................................22 A. The attorney-client privilege does not justify withholding the documents at issue........................................................................................................................22 1. Legal standard. ...........................................................................................22 2. The Trump Organization cannot establish that the relevant communications were made for the purpose of rendering legal advice or were predominantly of a legal character. ...................................23 3. Kovel does not apply here. .........................................................................26 B. The Trump Organization has refused, without justification, to produce certain documents responsive to OAG’s subpoenas. .............................................28 C. Eric Trump’s testimony should be compelled. ......................................................30 II. Mr. Martabano has failed to comply with the Attorney General’s subpoenas for documents and testimony. ..................................................................................................34 i 2 of 68 FILED: NEW YORK COUNTY CLERK 08/24/2020 12:45 PM INDEX NO. 451685/2020 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 08/24/2020 A. Mr. Martabano’s claims of privilege over responsive documents are waived for failure to substantiate the claims on an adequately detailed privilege log. ..........................................................................................................34 B. The attorney-client privilege does not justify Mr. Martabano’s refusal to testify about all conversations with any representative of the Trump Organization. ..........................................................................................................36 C. Mr. Martabano’s refusal to answer questions on the ground that they called for “opinion” testimony is improper. ..........................................................37 D. Mr. Martabano improperly refused to produce documents that he reviewed and that refreshed his recollection. ........................................................................39 III. Morgan Lewis has failed to comply with the subpoenas. ..................................................42 A. Morgan Lewis cannot establish that the relevant communications were made for the purpose of rendering legal advice or were predominantly of a legal character. .......................................................................................................42 B. Morgan Lewis’s broad work-product claims cannot be supported. .......................46 C. Morgan Lewis should produce documents that its former associate testified refreshed his recollection. ........................................................................48 D. Morgan Lewis should produce the documents it is withholding on a claim of “settlement privilege.” .......................................................................................48 E. Morgan Lewis may not withhold third-party communications. ............................50 F. Ms. Dillon’s testimony should be compelled. .......................................................51 III. Any privilege assertions have been waived. ......................................................................53 CONCLUSION ..............................................................................................................................58 ii 3 of 68 FILED: NEW YORK COUNTY CLERK 08/24/2020 12:45 PM INDEX NO. 451685/2020 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 08/24/2020 TABLE OF AUTHORITIES Page(s) CASES 313-315 W. 125th St. L.L.C. v Arch Specialty Ins. Co., 138 A.D.3d 601 (1st Dep’t 2016) ............................................................................................38 Am. Dental Coop., Inc. v. Attorney-General, 127 A.D.2d 274 (1st Dep’t 1987) ..............................................................................................5 Am. Friends of Yeshivat Ohr Yerushalayim, Inc. v. United States, No. 04-CV-1798 (CPS), 2009 WL 1617773 (E.D.N.Y. June 9, 2009) ...................................30 Am. Re-Insurance Co. v. U.S. Fid. & Guar. Co., 40 A.D.3d 486 (1st Dep’t 2007) ..............................................................................................53 Ambac Assurance Corp. v. Countrywide Home Loans, Inc., 27 N.Y.3d 616 (2016) ...................................................................................................... passim Anonymous v. High Sch. For Envtl. Studies, 32 A.D.3d 353 (1st Dep’t 2006) ........................................................................................ 34-35 Application of Waterfront Comm’n of N.Y. Harbor, 245 A.D.2d 63 (1st Dep’t 1997) ..............................................................................................33 Beach v. Touradji Capital Mgmt., LP, 99 A.D.3d 167 (1st Dep’t 2012) ........................................................................................ 40-41 Blackburn Food Corp. v. Ardi, Inc., 66 N.Y.S. 3d 840 (Sup. Ct. Suffolk Cty. 2017) .......................................................................38 Bluebird Partners, L.P. v. First Fid. Bank, N.A., 248 A.D.2d 219 (1st Dep’t 1998) ............................................................................................54 Brooklyn Union Gas Co. v. Am. Home Assurance Co., 23 A.D.3d 190 (1st Dep’t 2005) ..............................................................................................47 Chakmakjian v. NYRAC, Inc., 154 A.D.2d 644 (2d Dep’t 1989) .............................................................................................34 Chem. Bank v. Nat’l Union Fire Ins. Co., 70 A.D.2d 837 (1st Dep’t 1979) ..............................................................................................52 Cosby v. Am. Media, Inc., 197 F. Supp. 3d 735 (E.D. Pa. 2016) .......................................................................................49 iii 4 of 68 FILED: NEW YORK COUNTY CLERK 08/24/2020 12:45 PM INDEX NO. 451685/2020 NYSCEF DOC. NO. 11 RECEIVED NYSCEF: 08/24/2020 D’Alessio v. Gilberg, 205 A.D.2d 8 (2d Dep’t 1994) .................................................................................................51 Deacy v. Port Auth. of N.Y., No. 2004682011 (Sup. Ct. Bronx Cty. Aug. 25, 2013), aff’d, 117 A.D.3d 520 (1st Dep’t 2014) .......................................................................................................................55 DeBonis v. Corbisiero, 155 A.D.2d 299 (1st Dep’t 1989) ............................................................................................33