Garrison v. General Motors Corporation

• Decision Date: 22 January 1963
• Docket Number: No. 1440-60-EC.,1440-60-EC.
• Citation: 213 F. Supp. 515
• Parties: Robert A. GARRISON, Garrison Manufacturing Co., Inc., a corporation, and Ross Gear and Tool Company, Inc., a corporation (an involuntary plaintiff), Plaintiffs, v. GENERAL MOTORS CORPORATION, a corporation, Defendant.
• Court: U.S. District Court — Southern District of California

213 F. Supp. 515

Robert A. GARRISON, Garrison Manufacturing Co., Inc., a corporation, and Ross Gear and Tool Company, Inc., a corporation (an involuntary plaintiff), Plaintiffs, v. GENERAL MOTORS CORPORATION, a corporation, Defendant.

No. 1440-60-EC.

United States District Court S. D. California, Central Division.

January 22, 1963.

Harris, Kiech, Russell & Kern, by Ford Harris, Jr., and Donald C. Russell, Los Angeles, Cal., Sheppard, Mullin, Richter & Hampton, Los Angeles, of counsel, by James C. Sheppard and Gordon F. Hampton, Los Angeles, Cal., for Robert Garrison and Garrison Mfg. Co.

Lyon & Lyon, by Richard E. Lyon, Los Angeles, Cal., Barnes, Kisselle, Raisch & Choate, by Arthur Raisch, Detroit, Mich., for General Motors Corp.

CRARY, District Judge.

Plaintiffs seek inspection, under the provisions of Rule 34, F.R.Civ.P., of communications between an officer of defendant General Motors Corporation (hereafter referred to as GMC) and an attorney in the corporation's patent section, as well as communications between attorneys in the patent section and communications between patent section attorneys and corporation employees and representatives of the company's Saginaw Steering Gear Division, hereafter referred to as SSGD.

All of the attorneys in the patent section working in Michigan were members of the Michigan Bar except Mr. Beecher, who was admitted to practice in Indiana and Massachusetts. All but one of the attorneys involved in the company's patent section in Washington, D. C., were members of the Bar of the District of Columbia.

The employees of the corporation at SSGD include the Division Manager, Mr. W. H. Doefner, Mr. C. W. Lincoln, Chief Engineer, Paul W. Wysong, Senior Project Engineer, and H. A. Boehringer, Assistant Chief Engineer. It appears from the affidavit of Mr. Doefner that the above mentioned persons, individually and as a group, took substantial part in the decisions that were made at SSGD on the advice of patent attorneys in GMC patent section. It also appears that Mr. Doefner decided "what course to pursue upon the advice of the attorneys in GM patent section."

Defendant asserts that all the communications in question come within the attorney-client privilege and need not be produced for inspection. Plaintiffs deny that any of the communications are within the attorney-client privilege and contends that all are subject to production and inspection under Rule 34, F.R.C.P.

The parties have stipulated to the issues to be determined, as follows:

1. Are relevant communications, between employee-attorneys in the patent section of a corporation and other employees of the corporation, protected from disclosure because of the attorney-client privilege? In other words, are such employee-attorneys to be classified as attorneys-at-law insofar as the privilege is concerned?

2. Are such communications outside the attorney-client privilege when the attorney involved is a member of the corporation's patent section but not a member of the Bar in the jurisdiction where he is employed? In other words, is such an employee-attorney to be classified as an attorney-at-law insofar as the privilege is concerned?

3. Are such communications entitled to the protection of the attorney-client privilege when the communications with the attorney come from, or are to, a corporate employee who is not in a position to control the action of the corporation with respect to the advice of the attorney? In other words, is such a corporate employee a "Client", is he the equivalent of the corporation, so that the requirement that there must be a client is met under the rule?

4. Are the communications between the defendant and an attorney-at-law, admitted to the California Bar, practicing in that jurisdiction, and not an employee of defendant, privileged?

The court concludes that the law of California with respect to attorney-client privilege applies in the instant case under the rules as announced by the Ninth Circuit Court of Appeals in the case of Baird v. Koerner, 279 F.2d 623. That case involved the question of whether disclosure by an attorney of the name of his client was a matter within the attorney-client privilege. On page 628 of the opinion, the court quotes from Corpus Juris Secundum, 35 C.J.S. Federal Courts § 131b, as follows:

"On the question of privileged communications, the federal courts follow the law of the state of the forum."

At page 632, the court further observes:

"In summation, we find (1) that because the relationship of client and attorney is created and controlled by the law of the various states; and that such creation and control is recognized, followed, and approved by the federal courts, the nature and extent of the privilege created between a lawyer and his client by the attorney-client relationship requires the federal courts to follow the state law; * * * (4) that no federal statute forbids the use of the law of the forum state, and that if there is any definite rule set up by federal statute, it requires us to follow the law of the forum state, and (5) any federal `common law' which may exist does not require us to ignore the forum state law; * * * (7) that each case must stand on its own facts, with the courts balancing the public policy considerations involved, and we hold the law of the forum state should, and does control—here the State of California."

Referring to page 635 of the court's opinion, it is noted that the government urged no attorney-client relationship existed upon the ground, among others, "(b) that the communications (at the first meeting) were from third persons (agents of the taxpayers, not the taxpayers);". The court goes on to say, referring to the second ground which is quoted as (b) above, "The second ground is not well taken in law."

The court concludes that Attorney Beecher, though not a member of the Michigan Bar, might well be engaged in giving legal advice, in the course of professional employment, to other attorneys in the patent section and to persons who would be considered as members of the "control group" of GMC, which communications would be within the attorney-client privilege. There is no showing in the instant case that local authorities in Michigan require admission to the local Bar of attorneys in the GMC patent section who may be giving legal advice. Zenith Radio Corp. v. Radio Corporation of America, D.C., 121 F.Supp. 792 at 794.

Judge Kirkpatrick, in his opinion in the case of City of Philadelphia v. Westinghouse Electric Corporation, 210 F.Supp. 483 (E.D.Pa.1962), discusses the authority of a corporation representative necessary for him to be considered a member of what the court in the instant case has termed the "control group", as follows:

"Keeping in mind that the question is, Is it the corporation which is seeking the lawyer's advice when the asserted privileged communication is made?, the most satisfactory solution, I think, is that if the employee making the communication, of whatever rank he may be, is in a position to control or even to take a substantial part in a decision about any action which the corporation may take upon the advice of the attorney, or if he is an authorized member of a body or group which has that authority, then, in effect, he is (or personifies) the corporation when he makes his disclosure to the lawyer and the privilege would apply. In all other cases the employee would be merely giving information to the lawyer to enable the latter to advise those in the corporation having the authority to act or refrain from acting on the advice."

Mr. Doefner, in his affidavit, after describing the job assignments of Lincoln, Wysong and Boehringer, as outlined above, states that Boehringer and Wysong "were responsible to and acting under the authority of C. W. Lincoln as Chief Engineer", who acted under the authority of Doefner, and that Lincoln, Boehringer and Wysong were "authorized to communicate confidential information" from SSGD to General Motors Corporation patent section "relevant to inventions, development and products * * *" re possible infringement, validity, and so forth.

The pending action for alleged infringement was filed by plaintiff on December 29, 1960. Mr. Lincoln's employment terminated as of February 1, 1958, Mr. Wysong terminated March 31, 1962, and Mr. Boehringer terminated December 2, 1952.

If the case of Holm v. Superior Court, 42 Cal.2d 500, 267 P.2d 1025, 268 P.2d 722, is to be followed literally, then any report of an employee to his company which was sent to the company's attorney for use in possible litigation might be urged to be privileged. As stated by Judge Barnes in the Baird case, supra, 279 F.2d at page 632, "* * * Each case must stand on its own facts, with the courts balancing the public policy consideration involved, * * *." See also Greyhound Corp. v. Superior Court, 56 Cal.2d 355 at 396-398, 15 Cal.Rptr. 90, 364 P.2d 266.

In the case at bar, the court concludes that Messrs. Wysong and Boehringer, mentioned hereinabove, in the SSGD should not properly be considered within the "control group" (the client) insofar as concerns the application of the attorney-client privilege. Though the members of the "control group" would be considered to be agents of the corporation within the attorney-client privilege, there must be some limitation with respect to this group or communications from all employees of the company who a member of the "control group" might designate to give confidential information for the purposes of obtaining legal advice, or to take a substantial part in certain decisions, would be privileged. This would vest authority in the "control group" to determine...