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March 01, 2017

Privilege: After Mohawk: What Remedies Are Left for Litigants Facing Adverse Privilege Rulings?

Edna Selan Epstein

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Your client has just lost a privilege claim and has been ordered by the trial court to turn over attorney-client privileged documents. These may prove to be the nail in the coffin to your successful defense on the claims at issue. You are convinced that the trial court made a mistake in ruling that the documents were indeed privileged communications between your client and in-house counsel but that the privilege had been waived.

What are you to do? Appeals from trial court decisions that are not final are precluded under 28 U.S.C. § 1291. The discovery ruling is dispositive of your privilege claim, but it is not a final judgment on the underlying claims. However, until the Supreme Court weighed in on the question of interlocutory appeals in Mohawk Industries, Inc. v. Carpenter, 558 U.S. 100 (2009), you had four arrows in your quiver. Thanks to Mohawk, you now have only three left.

In Mohawk, the Supreme Court unanimously closed the door on a route to interlocutory appeal of its own making under 28 U.S.C. § 1291, known as the Cohen doctrine. In Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541 (1949), the Supreme Court allowed an interlocutory appeal of a trial court’s ruling refusing to set a bond for projected costs and attorney fees in an appeal in a class action suit. The Court reasoned that there existed a small category of cases that “finally determine claims of right separable from, and collateral to, the rights asserted in the action, too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated.” Id. at 546. Although circuit courts of appeals were split regarding the Cohen doctrine, litigants thereupon used the Cohen doctrine to appeal from adverse privilege rulings. Now, following Mohawk, the Cohen doctrine is no more.

In Mohawk, a supervisor sent an email complaining that the company was hiring undocumented workers to lower the wages of documented employees. The supervisor did not know of the pendency of a class action based on that very claim. He was called into conference with the company’s lawyers and asked to retract the claim he made in the email. He refused. He was fired. He brought a retaliatory discharge suit. In that suit, he sought the notes of his conversations with the company’s attorneys. The company claimed privilege. The supervisor claimed waiver because the company had made certain representations in the separate class action. The supervisor prevailed on the argument that whatever privilege had existed had been waived by raising the matter in the class action. The company was ordered to produce the attorneys’ notes from their meeting with the supervisor.

The company took a Cohen-based interlocutory appeal from the adverse privilege ruling. It lost in the appellate court, whose ruling was affirmed in the Supreme Court. By shutting the Cohen doctrine gate in instances of adverse privilege rulings requiring disclosure of privilege-protected documents, the Supreme Court in Mohawk effectively made any appeal from such rulings difficult indeed. Litigants are henceforth forced back to three undesirable methods of appeal:

  • A mandamus action against the trial court’s ruling. Because such a mandamus action must be predicated on a claim of abuse of discretion and clear judicial error on the law, this method presents a very high hurdle for litigants.
  • An interlocutory appeal certified by the trial court itself when it feels its ruling covers novel legal grounds and the court is unsure of the accuracy of its own ruling. Few and far between are the areas of privilege law where this method of appeal will become an option.
  • Or you could simply stand your ground. Refuse to turn over the documents you claim to be privilege-protected. Accept a finding of contempt by refusing to comply with a discovery order and take an immediate appeal from that contempt order. If you are right, the contempt order will be vacated and the privilege-protected documents will not have to be disclosed. If you do take this approach, you are clearly playing high-stakes judicial poker. A lawyer can protect himself or herself from the finding of contempt by having the client take the fall—provided full disclosure is made to the client of what is at stake.

If you feel these options are unappealing, you’re not alone.

Is there a real-life, more practical remedy? Yes. Don’t be so quick to “paper” every business decision. It is unlikely that, as a practical matter, most courts would insist that in-house attorneys be required to testify on the subject. And even were the court to so order, memories being notoriously fallible, even if the attorneys are being scrupulously truthful, the accuracy of their recollections is not likely to be as damning as the written word.

Edna Selan Epstein

The author, an associate editor of Litigation, is the author of Attorney-Client Privilege and the Work-Product Doctrine, Sixth Edition (ABA 2017).