Pfizer Inc. v. Lord

• Decision Date: 15 February 1972
• Docket Number: No. 71-1581.,71-1581.
• Citation: 456 F.2d 545
• Parties: PFIZER INC., et. al., Defendants-Petitioners, v. Honorable Miles W. LORD, United States District Judge, Respondent, and State of Kansas and Named Plaintiffs in Forty-Eight Other Cases, Plaintiffs-Respondents.
• Court: U.S. Court of Appeals — Eighth Circuit

456 F.2d 545 (1972)

PFIZER INC., et. al., Defendants-Petitioners, v. Honorable Miles W. LORD, United States District Judge, Respondent, and State of Kansas and Named Plaintiffs in Forty-Eight Other Cases, Plaintiffs-Respondents.

No. 71-1581.

United States Court of Appeals, Eighth Circuit.

February 15, 1972.

John A. Cochrane, St. Paul, Minn., for respondents.

Robert Morgan, Atty. Gen., Jean A. Benoy, Deputy Atty. Gen., and Louis W. Payne, Jr., Associate Atty., State of North Carolina, Raleigh, N.C., for respondent, State of North Carolina.

Gibson, Dunn & Crutcher, Los Angeles, Cal., Maun, Hazel, Green, Hayes, Simon & Aretz, St. Paul, Minn., for Pfizer Inc.

Winthrop, Stimson, Putnam & Roberts, New York City, for Bristol-Myers Co.

Faegre & Benson, Minneapolis, Minn., for Bristol-Myers Co., Squibb Corporation and The Upjohn Co.

Donovan, Leisure, Newton & Irvine, New York City, Dorsey, Marquart, Windhorst, West & Halladay, Minneapolis, Minn., for American Cyanamid Co.

Cravath, Swaine & Moore, New York City, for Squibb Corporation and Olin Corporation.

Covington & Burling, Washington, D. C., for The Upjohn Co.

Before MATTHES, Chief Judge, and BRIGHT and ROSS, Circuit Judges.

PER CURIAM.

We have for consideration a petition, filed by defendants in these cases, seeking a writ of mandamus directing the Honorable Miles W. Lord, United States District Judge for the District of Minnesota, before whom these actions are pending, to vacate and rescind Discovery Order No. 71-15, filed October 1, 1971, sub nom. In re Coordinated Pretrial Proceedings In Antibiotic Antitrust Actions, 4-71 Civ. 435. Pursuant to Fed. R.App.P. 21, respondent Lord and the plaintiffs-respondents were authorized to answer or otherwise respond to the petition. Judge Lord declined to file any response, but answers were filed by or on behalf of all plaintiffs.¹

I

We begin with a discussion of the history of these proceedings. This litigation has its origins in the late 1940's and early 1950's, during which time petitioners were involved in the discovery, patenting, patent licensing, manufacturing, and distribution of certain broad spectrum antibiotic drugs, particularly tetracycline. These activities became the subject of numerous official proceedings, including a Federal Trade Commission proceeding under Section 5 of the Federal Trade Commission Act, 15 U.S.C. § 41 et seq., a criminal prosecution under Sections 1 and 2 of the Sherman Antitrust Act, 15 U.S.C. § 1 et seq., and more than 150 damage actions. The majority of the damage actions have been disposed of by settlement. We are concerned here with 49 unsettled and consolidated damage actions, which presently are proceeding through their pre-trial stage in the district court.

Early in August, 1971, and pursuant to agreement of the parties, the district court appointed three attorneys as masters to assist the court in determining the discoverability of a rather large quantity of documents which respondents sought to obtain from petitioners. Petitioners claimed that many of these documents were shielded by the attorney-client privilege.

The masters filed on October 1, 1971, their "opinion . . . on the application of the attorney-client privilege to documents submitted by defendants." The opinion concluded, in summary, as follows:

". . . All Pfizer documents dealing with tetracycline prepared during or after September, 1954, are documents involved in the furtherance of a fraud on the patent office and are not protected by the attorney-client privilege.

". . . All Cyanamid documents dealing with tetracycline prepared during or after January, 1954, are documents involved in the furtherance of a fraud on the patent office and are not protected by the attorney-client privilege.

". . . All documents of Bristol, Squibb and Upjohn dealing with tetracycline prepared during or after December, 1955, are documents involved in the furtherance of a violation of the Sherman Act or tort and are not protected by the attorney-client privilege."

Opinion of Masters at 13, 16, 17. The district court, in the order here at issue, adopted the findings of the masters and directed that documents "which in the Masters' determination are not protected by the attorney-client privilege, will be produced to plaintiffs." In re Coordinated Pretrial Proceedings In Antibiotic Antitrust Actions, supra.

The order came under attack by petitioners, but Judge Lord refused to issue the certificate which is a prerequisite to an interlocutory appeal under 28 U.S.C. § 1292(b). Petitioners thereupon instituted this proceeding to challenge the validity and scope of the discovery order. Petitioners contend basically that even if the masters and the district court were correct in finding that prima facie showings of fraud and crime had been established, their conclusions regarding discoverability were erroneous because (1) there had been no finding that petitioners had employed the attorney-client relationship to perpetrate or further the fraud or crime, and (2) the language in which the conclusions were cast was overbroad and would require the exposure to respondents of privileged as well as unprivileged documents. Petitioners Bristol, Squibb, and Upjohn complain also that the findings against them lack adequate evidentiary bases.

Respondents counter first by arguing that mandamus is not an appropriate remedy, and next by denying that the law of privileged communications has been applied improperly or that the discovery order is overbroad.

II

We consider first whether mandamus is available in federal courts as a means of reviewing interlocutory orders, and particularly discovery orders. There appears to be some conflict in this regard among distinguished authorities on federal court procedure. After observing that many states routinely use extraordinary writs for the review of discovery orders, the authors of one treatise state the following:

"The traditional federal attitude has been that `as extraordinary remedies they are reserved for really extraordinary cases.\' . . . But there has been a general loosening of the federal attitude toward mandamus and the discovery cases have not been unaffected."

8 Wright and Miller, Federal Practice and Procedure § 2006, p. 32 (1971), citing Ex parte Fahey, 332 U.S. 258, 67 S.Ct. 1558, 91 L.Ed. 2041 (1947). Another commentator, however, devotes considerable attention to the opinion of the Supreme Court in Will v. United States, 389 U.S. 90, 88 S.Ct. 269, 19 L. Ed.2d 305 (1967), and concludes that this opinion "appears to rechart the area of the availability of mandamus along quite restrictive lines." 9 Moore and Ward, Moore\'s Federal Practice § 110.28, p. 308 (1970).

The Will case arose out of a criminal proceeding in which a federal district court judge had threatened to dismiss indictments unless the government disclosed certain information to the accused. The United States Court of Appeals for the Seventh Circuit issued a writ of mandamus directing that the disclosure order be vacated, but the Supreme Court found mandamus inappropriate and reversed. The office of mandamus, the Court stated, "is not to `control the decision of the trial court,' but rather merely to confine the lower court to the sphere of its discretionary power." 389 U.S. at 104, 88 S.Ct. at 278.²

We do not believe that the Will opinion requires a denial of mandamus review in this case.³ We are persuaded, rather, that the claim of privilege asserted by petitioners involves a "really extraordinary" question, and we agree with the following observation from the opinion of the Seventh Circuit Court of Appeals in Harper & Row Publishing Co. v. Decker, 423 F.2d 487, 492 (7th Cir.1970):

. . . Because maintenance of the attorney-client privilege up to its proper limits has substantial importance to the administration of justice, and because an appeal after disclosure of the privileged communication is an inadequate remedy, the extraordinary remedy of mandamus is appropriate.

That decision was affirmed without opinion by a divided Supreme Court, 400 U.S. 348, 91 S.Ct. 479, 27 L.Ed.2d 433 (1971). Cf. Hartley Pen Co. v. United States District Court, 287 F.2d 324 (9th Cir.1961). Due consideration of all aspects of this discovery order, in light particularly of possible consequences which review on appeal might prove inadequate to remedy impels us to hold that mandamus is an appropriate vehicle for review of the question raised by the present petition.

III

This brings us to the crucial question of whether mandamus ought to issue in this case. Our discussion of this question is divided to reflect consideration of four points: (1) the applicable law of privileged communications; (2) propriety of the findings that prima facie showings of fraudulent or criminal activity had been made against each defendant; (3) whether there were findings that defendants abused the attorney-client relationship in furtherance of such improper activity; and (4) the breadth of the discovery order.

Applicable Law

It is a fundamental tenet of the law of evidence that, generally, communications between attorney and client are privileged and not subject to compelled disclosure. Chirac v. Reinicker, 24 U.S. 278, 292, 11 Wheat. 278, 292, 6 L.Ed. 474 (1826); Hunt v. Blackburn, 128 U.S. 464, 470, 9 S.Ct. 125, 32 L.Ed. 488 (1888); Radiant Burners, Inc. v. American Gas Ass'n, 320 F.2d 314, 318-322 (7th Cir.1963); United States v. United Shoe Machinery Corp., 89 F.Supp. 357, 358 (D.Mass.1959). The general rule is subject to qualification, however, and it is with such a qualification that we are concerned in these cases.

The exception to the attorney-client privilege which is involved here has been formulated as follows:

It has been agreed from the beginning that the privilege cannot avail to protect the client in concerting with the attorney a crime or other evil enterprise. This is for the logically sufficient reason that no such enterprise falls

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