Sealed Case, In re
| Decision Date | 15 June 1984 |
| Docket Number | Nos. 84-5065,84-5087,s. 84-5065 |
| Citation | 737 F.2d 94 |
| Parties | , 1984-1 Trade Cases 66,062, 15 Fed. R. Evid. Serv. 1811 In re SEALED CASE. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Appeal from the United States District Court for the District of Columbia (Misc. No. 83-00337).
Before ROBINSON, Chief Judge, GINSBURG, Circuit Judge, and EDMUND L. PALMIERI, * Senior United States District Judge for the Southern District of New York.
Opinion for the Court filed by Circuit Judge GINSBURG.
This is an expedited appeal from a district court order instructing an attorney to testify before a grand jury on matters the attorney's former client regards as privileged. Appellant is a corporation (hereafter, "the Company") 1 targeted for investigation by the grand jury. The witness whose testimony is at stake formerly served as the Company's vice president-general counsel, and sole in-house attorney. The Company instructed its former counsel to raise the attorney-client privilege regarding several grand jury inquiries. Former counsel did so and the government moved to compel his testimony.
The district court granted the motion as to four conversations between the witness and the Company's president, and two "hunches" the witness entertained; it denied the motion as to one conversation between the witness and a Company senior executive. In re Grand Jury Proceedings, Misc. No. 83-00337 (D.D.C. Jan. 25, 1984) (hereafter "D.D.C. Memorandum and Order"). The Company seeks review of the district court's order to the extent that it grants the government's motion, and the government cross-appeals regarding the one conversation that the district court held privileged.
We hold first that the challenged order is subject to immediate appeal. On the merits of the cross-appeals, we affirm the district court's order as to one of the counsel to Company president communications (the report and ensuing exchange concerning information overheard at the O'Hare Hilton), counsel's two "hunches," and the conversation between the Company senior executive and counsel; we reverse and uphold the claim of privilege as to three of the conversations between counsel and the Company president.
The former vice president-general counsel whose grand jury testimony is at issue (hereafter, "C") was the Company's sole in-house attorney from 1976 until 1981. Joint Appendix (hereafter, "J.A.") 385. C was responsible for all Company legal affairs; he reported directly to the Company's president (hereafter, "P"). J.A. 213-14. P and other Company personnel informed C about virtually all Company business activities, and C used the information thus received to render legal advice on a daily basis to a wide variety of Company employees. J.A. 226-27. 2
Prompting the grand jury investigation of Company activities, the Department of Justice received an anonymous letter in early 1982 addressed to the "Deputy Attorney General, Antitrust." J.A. 381-83. The letter listed, with some supporting detail, instances of alleged bid rigging on several major construction projects. C admits that he wrote the letter. J.A. 274.
In the course of the investigation, C appeared before the grand jury and testified at length about his activities and observations during his tenure with the Company. See J.A. 13-180. At certain "critical points," however, on instruction from the Company's current counsel, C asserted attorney-client privilege and refused to answer questions. See Brief for the Government at 9. C's refusal to answer related to five matters:
(1) A 1980 disclosure by C to P concerning a conversation C overheard at the O'Hare Hilton (J.A. 93-98);
(2) The bases for certain "hunches" C had regarding Company involvement in bid rigging (J.A. 64-70, 111-12, 119-22, 154-55, 159); 3
(3) A 1978 or 1979 conversation between C and a Company senior executive at a St. Paul restaurant (J.A. 117-18, 168-70);
(4) Two 1979 or 1980 conversations between C and P in P's office in the course of periodic status reviews of the Company's legal affairs (J.A. 103-06);
(5) A 1978 conversation between C and P aboard an airplane (J.A. 129-41).
In response to the government's motion to compel C's testimony, the district court held two evidentiary hearings, received briefs, and entertained oral argument. The court then ruled that, as to all four conversations with P and two of C's "hunches," the Company had not established entitlement to privileged communication protection. The court upheld the attorney-client privilege plea on one matter: C's St. Paul restaurant conversation with a Company senior executive. D.D.C. Memorandum and Order, J.A. 1-11.
The Company maintains in this appeal that the attorney-client privilege shields all matters addressed in the government's motion to compel; the government seeks reversal of the district court's order as to the one matter on which it did not prevail.
It is the main rule that an order in an ongoing proceeding compelling testimony or documentary production is not immediately appealable; to obtain instant appellate review, the party to whom the command is addressed must refuse to respond and submit to a contempt citation. Cobbledick v. United States, 309 U.S. 323, 60 S.Ct. 540, 84 L.Ed. 783 (1940); Alexander v. United States, 201 U.S. 117, 26 S.Ct. 356, 50 L.Ed. 686 (1906); National Super Spuds, Inc. v. New York Mercantile Exchange, 591 F.2d 174 (2d Cir.1979); United States v. Anderson, 464 F.2d 1390 (D.C.Cir.1972). 4 In Perlman v. United States, 247 U.S. 7, 38 S.Ct. 417, 62 L.Ed. 950 (1918), the Supreme Court indicated an exception to the main rule; the Company in this case dominantly relies on the Perlman exception.
In Perlman, a United States Attorney obtained a court order for the production before a grand jury of exhibits deposited with a district court clerk in prior litigation. Perlman alleged that the deposited materials belonged to him and moved to block their presentation to the grand jury. He asserted that government use of the exhibits would violate his rights under the Fourth and Fifth Amendments. The court clerk had no interest in resisting production and could not be expected to stand in contempt to aid Perlman. The district court denied Perlman's motion. The Supreme Court declared that ruling immediately appealable. Absent instant review, the Court said, Perlman would be "powerless to avert the mischief of the order." 247 U.S. at 13, 38 S.Ct. at 419. 5
Following High Court instruction, see United States v. Ryan, 402 U.S. 530, 533, 91 S.Ct. 1580, 1582, 29 L.Ed.2d 85 (1971), we have confined the Perlman exception to situations in which the contempt route to instant appellate review is unavailable. In re Sealed Cases, 655 F.2d 1298 (D.C.Cir.1981). 6 That is the situation here. C stated under oath that if the district court ordered his testimony he would not stand in contempt to permit an immediate appeal from the district court's ruling. J.A. 347. The government acknowledges that this is the atypical case in which "the circumstances make it unlikely that a former attorney will stand in contempt." Brief for the Government at 16 n. 12. C is no longer in the Company's employ; he has no work product to protect; he is not likely to view the Company as an object of his continuing devotion. 7
"[I]t is not our prerogative to enlarge the [Perlman ] exception," In re Sealed Cases, 655 F.2d at 1302, but neither are we positioned to declare its demise. See National Super Spuds, 591 F.2d at 179. Because it is at least "unlikely that [C] would risk a contempt citation in order to allow immediate review of [the Company's] claim of privilege," United States v. Nixon, 418 U.S. 683, 691, 94 S.Ct. 3090, 3099, 41 L.Ed.2d 1039 (1974), we hold this case within the limited class to which Perlman applies, and therefore turn to the attorney-client privilege issues tendered for review.
We set out initially, as did the district court and the parties, the concise summary of the attorney-client privilege composed by Judge Wyzanski in United States v. United Shoe Machinery Corp., 89 F.Supp. 357, 358-59 (D.Mass.1950):
The privilege applies only if (1) the asserted holder of the privilege is or sought to become a client; (2) the person to whom the communication was made (a) is a member of the bar of a court or his subordinate and (b) in connection with this communication is acting as a lawyer (3) the communication relates to a fact of which the attorney was informed (a) by his client (b) without the presence of strangers (c) for the purpose of securing primarily either (i) an opinion on law or (ii) legal services or (iii) assistance in some legal proceeding, and not (d) for the purpose of committing a crime or tort; and (4) the privilege has been (a) claimed and (b) not waived by the client.
To this we append two additional black letter statements. Communications from attorney to client are shielded if they rest on confidential information obtained from the client. Mead Data Central, Inc. v. United States Department of Air Force, 566 F.2d 242, 254 (D.C.Cir.1977). Correlatively, "when an attorney conveys to his client facts acquired from other persons or sources, those facts are not privileged." Brinton v. Department of State, 636 F.2d 600, 604 (D.C.Cir.1980) (footnote omitted), cert. denied, 452 U.S. 905, 101 S.Ct. 3030, 69 L.Ed.2d 405 (1981).
In practice, however, advice does not spring from lawyers' heads as Athena did from the brow of Zeus. Inevitably, attorneys' opinions reflect an accumulation of education and experience in the law and the large society law serves. In a given case, advice prompted by the client's disclosures may be further and inseparably informed by other knowledge and encounters. We have therefore stated that the privilege cloaks a communication from attorney to client " 'based, in part at least, upon a...
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