In re Carvana Co Securities Litigation

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ARIZONA
United Association National Pension Fund, et
al.,
Plaintiffs,
v.
Carvana Company, et al.,
Respondents.
No. CV-22-02126-PHX-MTL
ORDER
Pending before the Court are four Rulings issued by Special Master Cohen (“Special
Master”) (docs. 552, 574, 585, and 587).1 Of these Rulings, the parties have only objected
to the Special Master’s June 26, 2026, “Ruling Regarding Tranche One of Carvana
Documents” (doc. 552). See (doc. 562). But, the Objection—filed by Carvana Defendants
(“Defendants”)—also indirectly implicates the Special Master’s July 20, 2026, “Updated
Ruling in Light of Carvana’s Objection to Prior Tranche One Document Ruling” (doc.
574). Compare (doc. 562) with (doc. 574). Given this, the Court shall review both the June
26, 2026, and July 20, 2026, Rulings in light of Defendants’ Objections.
Because the Court finds that the Special Master’s reasoning in (doc. 552) and (doc.
574) is persuasive, and given that the Court independently reaches the same conclusions,
the Court shall overrule Defendants’ objections and adopt the Rulings. Furthermore, given
that no objections were filed as to the Special Master’s July 28, 2026 (doc. 585) and July
29, 2026 (doc. 587) Rulings, and seeing that the Special Master’s reasoning is persuasive
1 Discovery matters in this action have been referred to this Court by the presiding
United States District Judge. (Doc. 125.)
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and well-articulated, the Court shall adopt these Rulings in their entirety.
I. LEGAL STANDARDS.
A. Objections to Special Master Rulings.
“Pursuant to Federal Rule of Civil Procedure 53(f), the court must decide de novo
all objections to the findings of fact or conclusions of law made or recommended by a
special master.”2 Cal. Expanded Metal Prods. Co. v. Klein, No. C18-0659JLR, 2022 U.S.
Dist. LEXIS 120812, at *4 (W.D. Wash. July 8, 2022) (citing Fed. R. Civ. P. 53(f)(3)–(4)).
“On matters of procedure, the Special Master’s rulings are reviewed for abuse of
discretion.” J.K. v. Humble, No. CV 91-261 TUC-AWT, 2013 U.S. Dist. LEXIS 95456, at
*4 (D. Ariz. July 9, 2013) (citing Fed. R. Civ. P. 53(f)(5)).
“In acting on a master’s order, report, or recommendations, the court must give the
parties notice and an opportunity to be heard; may receive evidence; and may adopt or
affirm, modify, wholly or partly reject or reverse, or resubmit to the master with
instructions.” Fed. R. Civ. P. 53(f)(1).
B. Attorney-Client Privilege.
“The attorney-client privilege protects confidential disclosures made by a client to
an attorney in order to obtain legal advice as well as an attorney’s advice in response to
such disclosures.” United States v. Chen, 99 F.3d 1495, 1501 (9th Cir. 1996) (cleaned up)
(quoting In re Grand Jury Investigation, 974 F.2d 1068, 1070 (9th Cir. 1992)). “Its purpose
is to encourage full and frank communication between attorneys and their clients and
thereby promote broader public interests in the observance of law and administration of
justice.” Upjohn Co. v. United States, 449 U.S. 383, 389 (1981). “Because the attorney-
client privilege is in derogation of the search for truth, it is ‘narrowly and strictly
construed.’” Verizon Cal. Inc. v. Ronald A. Katz Tech. Licensing, L.P., 266 F. Supp. 2d
1144, 1147 (C.D. Cal. 2003) (quoting United States v. Gray, 876 F.2d 1411, 1415 (9th Cir.
1989)). In the Ninth Circuit, Courts apply an eight-part test to determine whether a
2 The Order appointing Special Master David Cohen contains no provision modifying
the de novo standard for deciding objections. See (doc. 500 at 3.) Although the Court did
not modify the de novo standard, it did deviate from Fed. R. Civ. P. 53(f)(2) by allocating
only 14 days to file an objection to a ruling by the Special Master. (Id.)
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document or communications is, in fact, privileged:
(1) legal advice of any kind is sought (2) from a professional legal adviser in
his capacity as such, (3) the communications relating to that purpose, (4)
made in confidence (5) by the client, (6) are at his instance permanently
protected (7) from disclosure by himself or by the legal adviser, (8) unless
the protection be waived.
United States v. Richey, 632 F.3d 559, 566 (9th Cir. 2011) (cleaned up).
Additionally, in the Ninth Circuit, “the primary-purpose test applies to attorney-
client privilege claims for dual-purpose communications.” Greer v. Cnty. of San Diego,
127 F.4th 1216, 1224 (9th Cir. 2025) (quoting In re Grand Jury, 23 F.4th 1088, 1092 (9th
Cir. 2022)). “Under the ‘primary purpose’ test, courts look at whether the primary purpose
of the communication is to give or receive legal advice, as opposed to business . . . advice.”
In re Grand Jury, 23 F.4th at 1091 (citation omitted). Notably, under the Ninth Circuit’s
“current formulation” of the primary purpose test, “a dual-purpose communication can
only have a single ‘primary’ purpose.” Greer, 127 F.4th at 1224 (citation omitted).
The “party asserting the attorney-client privilege has the burden of establishing the
relationship and the privileged nature of the communication.” United States v. Bauer, 132
F.3d 504, 507 (9th Cir. 1997). “Moreover, an assertion of privilege without evidence to
support it will not prevail.” Verizon Cal. Inc., 266 F. Supp. 2d at 1147 (citations omitted).
C. Work-Product Doctrine.
Under Rule 26, “[p]arties may obtain discovery regarding any nonprivileged matter
that is relevant to any party’s claim or defense and proportional to the needs of the case.”
Fed. R. Civ. P. 26(b)(1). While the Federal Rules of Civil Procedure provide a wide berth
for discovery, it does provide certain express limitations on what a party generally cannot
discover, including documents covered by the attorney work-product doctrine. See Fed. R.
Civ. P. 26(b)(3)(A) (“Ordinarily, a party may not discover documents and tangible things
that are prepared in anticipation of litigation or for trial by or for another party or its
representative[.]”).
“Federal law governs the application of the work product doctrine.” United
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Specialty Ins. Co. v. Dorn Homes, Inc., 334 F.R.D. 542, 544 (D. Ariz. 2020). “At its core,
the work-product doctrine shelters the mental processes of the attorney, providing a
privileged area within which he can analyze and prepare his client’s case.” United States
v. Nobles, 422 U.S. 225, 238 (1975); Dorn Homes, 334 F.R.D. at 544 (“This protection
applies to documents prepared ‘by or for another party or its representative (including the
other party’s attorney, consultant, surety, indemnitor, insurer, or agent).’”) (quoting Bickler
v. Senior Lifestyle Corp., 266 F.R.D. 379, 383 (D. Ariz. 2010)). “The work-product rule is
not a privilege but a qualified immunity protecting from discovery documents and tangible
things prepared by a party or his representative in anticipation of litigation.” Admiral Ins.
Co. v. United States Dist. Ct. for Dist. of Ariz., 881 F.2d 1486, 1494 (9th Cir. 1989). This
doctrine “shields both opinion and factual work product from discovery.” Pac. Fisheries,
Inc. v. United States, 539 F.3d 1143, 1148 (9th Cir. 2008).
“Generally, discoverable facts are not protected by the work-product doctrine.” ARA
Inc. v. City of Glendale, No. CV-17-02512-PHX-GMS, 2018 U.S. Dist. LEXIS 94074, at
*2 (D. Ariz. June 5, 2018). Rather, “To qualify for work-product immunity, documents
must: (1) be ‘prepared in anticipation of litigation or for trial’ and (2) be prepared ‘by or
for another party or by or for that other party’s representative.’” Id. (quoting United States
v. Torf (In re Grand Jury Subpoena), 357 F.3d 900, 907 (9th Cir. 2003)). “The party
asserting the work-product immunity has the burden of demonstrating that the at-issue
documents are work-product.” Id. at *2–3.
II. DISCUSSION.
In their Objection, Defendants challenge the Special Master’s June 26, 2026 Ruling
as to eight documents only. (Doc. 562 at 5.) Specifically, Defendants asserts five arguments
why the Special Master erred in finding that the eight documents at issue are not attorney-
client protected. (Id. at 6.)
First, Defendants assert that the Special Master erred by distinguishing “between in-
house and outside counsel when assessing privilege.” (Id.) Second, Defendants challenge
that the Special Master, “based on out-of-circuit district court cases, . . . incorrectly found
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that legal advice addressing specific regulatory questions was unprivileged ‘everyday
regulatory advice[.]’” (Id.) Third, Defendants assert that the Special Master improperly
“required that communications contain ‘actual advice’ to be privileged[.]’” (Id.) Fourth,
Defendants aver that “the Special Master failed to consider whether certain documents are
work product[.]” (Id.) Fifth, Defendants argue that “the Special Master overruled privilege
determinations based not on the content of the document reviewed, but on perceived
deficiencies in Carvana Defendants’ privilege log.” (Id.) The Court does not find any of
Defendants’ arguments availing.
Beginning with Defendants’ first argument, the Court does not find that the Special
Master erred in distinguishing between in-house and outside counsel when assessing
privilege claims. Here, Defendants contend that the Special Master, who—in the attorney-
client privilege context—applied a heightened standard to in-house counsel
communications, (doc. 552 at 4), erred because the heightened standard “has never been
recognized or applied by the Ninth Circuit or the District of Arizona.” (Doc. 562 at 11.)
Defendants argue that the heightened standard applied by the Special Master is “justified .
. . by . . . two unpublished district court opinions, one of which was out-of-circuit.” (Id.)
Hence, Defendants claim that the heightened standard employed by the Special Master is
erroneous and contrary to law. (Id.) Defendants rely, in pertinent part, on the Ninth
Circuit’s decision in United States v. Rowe, 96 F.3d 1294 (9th Cir. 1996) and ASU Students
for Life v. Crow, No. CV-06-1824-PHX-MHM, 2007 U.S. Dist. LEXIS 102443 (D. Ariz.
July 11, 2007), report and recommendation adopted, 2007 U.S. Dist. LEXIS 69003 (D.
Ariz. Sep. 14, 2007), to support their position.
The Court overrules this argument for three reasons. First, to the extent that
Defendants argue that a footnote in ASU Students for Life is mandatory authority on this
Court, they are mistaken, as that decision is “only ever persuasive authority” on courts
within this District. See Longhini v. Thornell, No. CV-24-00785-PHX-DJH, 2026 U.S.
Dist. LEXIS 135896, at *3–4 (D. Ariz. June 18, 2026) (noting that decisions from another
court in this District “are only ever persuasive authority on other federal courts, including
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other district courts. . . . [whereas] United States Court of Appeals rulings from each circuit
are binding on the district courts in the same circuit”). Second, Defendants’ reliance on
Rowe, wherein the Court of Appeals stated that “[i]n determining the existence of a
privilege, no attempt is made to distinguish between inside and outside counsel,” Rowe, 96
F.3d at 1296 (cleaned up), is likewise unavailing. This is because:
[t]he Rowe decision did not address the ‘clear showing’ standard or any other
standard for establishing privilege. Rather, the cited portion of Rowe found
that attorneys conducting an internal investigation at their own law firm
were, effectively, in-house counsel and therefore in an attorney-client
relationship with their employer. The decision did not address the standard
for determining whether the existence of an attorney-client privilege had
been shown[.] Requiring a clear showing of privilege in light of [an
attorney’s] role as in-house counsel was not clearly erroneous or contrary to
law.
Oracle Am., Inc. v. Google Inc., No. C 10-03561 WHA, 2011 U.S. Dist. LEXIS 121446,
at *23–25 (N.D. Cal. Oct. 20, 2011).
Third, the Court notes that the Special Master’s ‘clear showing’ standard has been
applied on multiple occasions by courts throughout the Ninth Circuit—including in
published opinions. See United States v. Chevron Texaco Corp., 241 F. Supp. 2d 1065,
1076 (N.D. Cal. 2002) (“With respect to internal communications involving in-house
counsel, Chevron must make a ‘clear showing’ that the ‘speaker’ made the communications
for the purpose of obtaining or providing legal advice”); see also Oracle Am., Inc. v.
Google, Inc., No. C-10-03561-WHA (DMR), 2011 U.S. Dist. LEXIS 96121, at *17–18
(N.D. Cal. Aug. 26, 2011) (“When attempting to demonstrate that an internal
communication involving in-house counsel deserves privileged status, a party therefore
must make a clear showing that the speaker made the communication for the purpose of
obtaining or providing legal advice.”) (cleaned up); In re Cal. Bail Bond Antitrust Litig.,
778 F. Supp. 3d 1051, 1058 (N.D. Cal. 2025) (same); City of Roseville Emps. Ret. Sys. v.
Apple Inc., No. 19-cv-02033-YGR (JCS), 2022 U.S. Dist. LEXIS 139843, at *61 (N.D.
Cal. Aug. 3, 2022) (same). Hence, the Court does not find that the Special Master’s
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distinction was neither erroneous nor contrary to law.3
Regarding Defendants’ second argument, the Court is likewise unpersuaded. As
noted by the Court in In re Cal.:
An attorney’s advice does not constitute legal advice simply because it
relates to regulatory activity. There is no bright-line rule that
communications related to regulatory compliance are per se business or legal
communications. Rather, the content and context of such communications
must be considered in order to determine the primary purpose of the
communication.
In re Cal., 778 F. Supp. 3d at 1060 (cleaned up).
Defendants contend that the Special Master incorrectly found that an email chain
contained in (doc. 562-2) was everyday regulatory advice. (Doc. 562 at 13–16.) The Court
disagrees. The instant exhibit contains several emails, wherein Defendants have redacted
several. See (doc. 562-2.) Notably, the redacted emails are between non-attorneys where
there is expressed skepticism on how to implement a company T&R change. See (id.) Here,
the Court does not find that the primary purpose of the instant communications was to seek
legal advice. Because the primary purpose was not to obtain legal advice on regulatory
matters, the Court finds the document at issue not privileged. See Shenwick v. Twitter, Inc.,
No. 16-cv-05314-JST (SK), 2018 U.S. Dist. LEXIS 185714, at *6 (N.D. Cal. Oct. 30, 2018)
(noting that certain communications were not privileged because, “[a]lthough in-house
lawyers are listed as recipients of the email messages, the contents of many of the email
messages indicate that the purpose of seeking comment is not for legal advice”). Further,
while it is true that the attorney-client privilege “protects from disclosure communications
3 Even assuming, arguendo, that an equal standard between in-house and external
counsel were applied, the Court finds that the Special Master’s Ruling as to (docs. 562-3
to -5, and 562-8 to -9) complied with the equal standard. Regarding (docs. 562-3 to -5) the
Court independently finds, as the Special Master has, that the primary purpose of these
communications between in-house counsel on title and registration matters was to carry
out a business function, not to provide legal advice. Likewise, the Court finds that (docs.
562-8 to -9), which contain slides for Carvana Board presentations, the Court likewise finds
that these slides did not address any legal analysis, recommendations, potential legal
consequences, or recommendations to address legal problems. Consequently, these
materials do not “reflect information related to counsel’s legal advice and are therefore
[not] covered by the attorney-client privilege.” United States v. Rite Aid Corp., No. 2:12-
cv-1699-KJM-EFB, 2021 U.S. Dist. LEXIS 61421, at *32 (E.D. Cal. Mar. 30, 2021).
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among corporate employees that reflect advice rendered by counsel to the corporation[,]”
Miller v. Ariz. Pub. Serv. Co., No. CV-19-03397-PHX-DWL, 2020 U.S. Dist. LEXIS
183520, at *8 (D. Ariz. Oct. 2, 2020) (citation omitted), the communications at issue here
do not appear to expressly reflect advice rendered by counsel to the corporation. Miller v.
Ariz. Pub. Serv. Co., No. CV-19-03397-PHX-DWL, 2020 U.S. Dist. LEXIS 183520, at *8
(D. Ariz. Oct. 2, 2020). For the foregoing reasons, Defendants’ second argument is
overruled.
Turning to Defendants’ third argument, the Court notes that, as an initial matter, the
argument as it pertains to (doc. 562-7) is moot considering the Special Master’s Updated
Ruling. (Doc. 574 at 6.) As the argument pertains to (doc. 562-6)—which contains an email
exchange between Defendants’ in-house counsel containing data trends regarding
temporary permit issuances in certain states—the Court finds the Special Master’s Ruling
persuasive. Additionally, the Court, upon its own independent review, reaches the same
conclusion as the Special Master. Although Defendants are correct that “investigation—
that is, discovering what happened—is a necessary predicate to assessing liability for that
past event and thus is not separate from the provision of legal advice,” (doc. 562 at 17)
(quoting Greer, 127 F.4th at 1224), information obtained during an investigation is
attorney-client protected where it relates to “avoiding future legal liability[.]” Greer, 127
F.4th at 1224. The communication in (doc. 562-6) does not appear to address any pending
or future legal or regulatory action regarding the states involved in the data trends.
Consequently, Defendants’ third argument is overruled.
The Court shall likewise overrule the Defendants’ fourth argument. Defendants
complain that the Special Master failed to recognize that (docs. 562-6 to -7) were work-
product protected. (Doc. 562 at 18.) But, Defendants did not previously assert that these
documents were work-product protected. See (doc. 574 at 6 n.1.) As noted by the Federal
Rules of Civil Procedure, to be entitled to work product protection, a party must “expressly
make the claim” that the matter is work product protected. Fed. R. Civ. P. 26(b)(5)(A)(i).
Because Defendants did not expressly make the claim as to these documents, and given
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that they bore the “burden of demonstrating that the at-issue documents are work-product,”
ARA Inc., 2018 U.S. Dist. LEXIS 94074, at *2–3, the Court finds the instant objection
unpersuasive. Thus, it is overruled.4
Turning to Defendants’ fifth argument, the Court is unconvinced. Here, Defendants
object to the Special Master’s ruling because—in Defendants’ position—he “improperly
overruled privilege determinations based on perceived deficiencies in . . . Defendants’
privilege log.” (Doc. 562 at 20.) While it may be true that, during an in camera review of
documents, a deficient entry in a privilege log may be insufficient to overrule a party’s
entitlement to a privilege, cf. Vargas v. United States, No. 5:23-cv-00380-JWH-SPx, 2025
U.S. Dist. LEXIS 147065, at *12 (C.D. Cal. June 9, 2025), the Special Master’s decisions
were not based solely on the privilege log. See (doc. 552 at 10.) Nothing in the June 26,
2026 Ruling or the July 20, 2026 Updated Ruling evince that the Special Master relied
solely on a deficient privilege log to make his determinations. Instead, the Special Master
appears to be sufficiently carrying out his duties to review materials in camera and in light
of additional or more detailed explanations provided by Defendants’ counsel. Hence, the
Fifth argument is overruled.5
For the foregoing reasons, the Court does not find any of Defendants’ arguments
availing. Therefore, their objections are overruled, and the Special Master’s Rulings are
adopted.
Accordingly,
IT IS ORDERED that Defendants’ Objections (doc. 562) are overruled.
4 Of the communications at issue, the Court notes that (doc. 562-9) is the only
document that Defendants have asserted is protected by the work product doctrine. See
(doc. 574 at 9.) Because this document—which contains slides of a report to Carvana’s
Board—were not “prepared in anticipation of litigation or for trial[,]” they are not work
product protected. See Torf (In re Grand Jury Subpoena), 357 F.3d at 907.
5 As a final matter, the Court shall grant the Defendants’ Motions to Seal (doc. 563
& 582.) The Court shall do so because the District Court granted a Protective Order which
rationally covers these documents. See (doc. 136.) Hence, the District Court has, ipso facto,
determined that good cause exists to protect these documents. See, e.g., Phillips ex rel.
Ests. of Byrd v. Gen. Motors Corp., 307 F.3d 1206, 1214 (9th Cir. 2002) (“When a court
grants a protective order for information produced during discovery, it already has
determined that “good cause” exists to protect this information from being disclosed to the
public by balancing the needs for discovery against the need for confidentiality.”).
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IT IS FURTHER ORDERED that the Special Master’s June 26, 2026 Ruling (doc.
552), as updated by his July 20, 2026 Updated Ruling (doc. 574), July 28, 2026 Ruling
(doc. 585), and July 29, 2026 (doc. 587) Ruling are ADOPTED for the reasons stated
herein.
IT IS FURTHER ORDERED that Defendants’ Motions to Seal (doc. 563 & 582)
are GRANTED. The Clerk of Court is kindly directed to file (docs. 564 & 583) UNDER
SEAL.
Dated this 31st day of August, 2026.
Honorable John Z. Boyle
United States Magistrate Judge
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