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IQVIA, Inc. v. Veeva Systems, Inc.

United States District Court, D. New Jersey

May 13, 2019

IQVIA, INC. and IMS SOFTWARE SERVICES, LTD, Plaintiffs/ Counterclaim Defendants,
v.
VEEVA SYSTEMS, INC., Defendant/Counterclaim Plaintiff.

          ORDER & OPINION OF THE SPECIAL MASTER

          DENNIS M. CAVANAUGH, U.S.D.J.

         This matter comes before the Special Master on Defendant-Counterclaim Plaintiff Veeva Systems, Inc.'s ("Veeva") motion to overrule Plaintiffs-Counterclaim Defendants IQVIA, Inc. and IMS Software Services, LTD's, (collectively "IQVIA") assertion of privilege over documents subpoenaed from Ernst & Young LLP ("EY"). After considering the submissions of the parties, based upon the following, it is the opinion of the Special Master that Veeva's motion to overrule IQVIA's assertion of privilege over documents subpoenaed from EY is GRANTED.

         DISCUSSION

         Background

         Prior to the commencement of litigation in this matter, clients of IQVIA asked it to license certain IQVIA data to Veeva for use by Veeva in its Master Data Management ("MDM") offering. Veeva had data offerings in the market and in development that competed with IQVIA data. In light of this, Veeva provided IQVIA with various assurances that IQVIA data would not be used by Veeva to improve Veeva's offerings. EY was subsequently retained by IQVIA "to evaluate the various assurances made by Veeva that (1) IMS Health reference data could be used in Veeva's MDM offering without risk that IMS Health reference data would be used, intentionally or inadvertently, to improve Veeva's own competing reference data offerings, and (2) these assurances are capable of confirmation with an audit of reasonable scope and cost." IQVIA intended to "use the information from the EY assessment to determine whether the assurances could be confirmed and serve as a basis for IMS Health to license its reference data to Veeva for use in Veeva's MDM offering."

         EY prepared a Statement of Work for Third Party Access Agreement Compliance Services dated August 10, 2015. The Scope of Service provided that EY would review IQVIA's Service Providers' compliance with the terms of its Third Party Access Agreement between IQVIA and the Service Provider, including: (1) review the terms of the pre-selected TPAs; (2) review the terms of the pre-selected Client Project Confirmations; (3) review Service Providers' offerings, including Service Providers' Master Data Management offering and offerings that utilize reference data; (4) identify and analyze the relevant IME Products and Services supplied to Clients; (5) identify and analyze the relevant IMS Products and Services supplied to Service Provider under the terms of the TPAs and CPCs, or obtained by the Service Providers from Clients or otherwise; (6) review the Service Providers' process and procedures that may include the delivery, storage, usage, security and disposition of the identified IMS Products and Services, including Service Providers' production, staging and testing environments; (7) assess and document the process and procedures designed to protect IMS's intellectual property rights in the identified IMS Products and Services, including IMS data intended to enhance, improve, update, validate, create, develop, or benchmark any Service Provider data, product or offerings; and (8) identify examples of non-compliance with the terms of the TPAs and CPC in connection with the delivery, storage, usage, security or disposition of the IMS Products and Services.

         With respect to the legal nature of the Scope of Service, the Statement of Work provides: "Although we have made no independent inquiry or determination with respect thereto, we acknowledge your belief that any services and reports provided by EY, or any portions of such reports..., are or may be protected from disclosure by the attorney-client privilege, work product protection, or both." In the Limitation on Scope of Work section, it provides: "None of the Services or any Reports will constitute any legal opinion or advice." Veeva and IQVIA subsequently entered into a Factual Findings & Reimbursement Agreement wherein Veeva agreed to pay for 50% of the aggregate amount of the final invoice for EY's assessment of Veeva's assurances. In exchange, at the conclusion of the EY assessment, Veeva was to receive a full written copy of the factual findings that included all facts and observations gathered in the course of the audit but did not include any IQVIA confidential information, recommendations or advice provided to IQVIA by EY.

         IQVIA subsequently filed a Complaint on January 10, 2017. In April 2018, Veeva subpoenaed EY seeking documents related to EY's audit of Veeva. These requests included: (1) documents related to IQVIA and EY's discussions of a possible audit of Veeva, including but not limited to, any discussion or negotiation of the scope of work, plans for contemplated or actual subject matter of an audit, instructions relating to the analysis or conclusions to be included, fees for the work, time to perform work, topics to pursue, goals, parameters, and further guidance; (2) documents relating to EY's audit of Veeva, including any notes, emails, reports, summaries, records of phone calls, messages, and any communications between EY and IQVIA regarding the results of EY's audit: (3) any engagement letters, scope of work, retention letters, fee schedules, or other documents governing IQVIA and EY's relationship; and (4) documents and communications relating to or concerning IQVIA's repose to EY's audit of Veeva. IQVIA subsequently claimed privilege over a number of the documents. According to its February 15, 2019, Amended Privilege Log, IQVIA claims attorney-client privilege over 1, 411 withheld documents and 893 redacted documents.

         Arguments

         Veeva

         Veeva argues that IQVIA's privilege assertions over these documents is improper as these documents do not involve communications between IQVIA and its in house counsel, but rather involve a third party, EY, Veeva does not believe EY was retained to assist IQVIA lawyers in rendering legal advice, but rather was commissioned to perform the Veeva assessment as a business project designed to help IQVIA make a business decision with respect to information obtained from internal Veeva systems. Veeva believes that in all instances, IQVIA's in-house counsel was acting in a business role. Veeva thus argues that EY's work was squarely in the business arena and that communications are not protected from disclosure by attorney-client privilege.

         Veeva further argues that the Koval exception only applies when a client's attorneys need a third party to translate or interpret information central to the provision of legal advice and that the third party's role must be to facilitate communication between the attorney and client. Veeva argues that the narrow Koval exception does not apply in this matter because EY was analyzing Veeva's information, not information possessed by IQVIA. Since EY was not putting information gained from IQVIA into usable form for their attorneys to render legal advice, Veeva argues the Koval exception cannot apply.

         Veeva finally argues that regardless of the merits of IQVIA's privilege claim, IQVIA's offensive use of the EY assessment in its Complaint and throughout its case means that IQVIA has waived ...


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