Supreme Court Has Opportunity To Resolve Circuit Split And Provide Better Guidance Regarding The Attorney-Client Privilege

The United States Supreme Court has a rare opportunity to address an important privilege issue that impacts all American businesses. In In re Grand Jury,[1] privilege claimants have filed a petition for writ of certiorari urging the Court to resolve conflicting circuit court tests for determining under what circumstances the attorney-client privilege protects dual-purpose communications from discovery.

Dual-Purpose Communications

Dual-purpose communications have mixed legal and business purposes. They provide, for example, confidential information to the lawyer for the purpose of obtaining legal advice or legal services, or to assist the lawyer in providing that advice. At the same time, they provide information for the purpose of obtaining non-legal advice from the lawyer. The lawyer, for his or her part, may provide advice that includes both legal and business advice.

Dual-purpose communications are common in American business—particularly with in-house counsel, but also with outside counsel. In-house counsel commonly have business responsibilities (and titles) and contribute to business decisions. Outside counsel too, in their role as trusted advisor, may be asked to provide advice that is not strictly legal.

Conflicting Privilege Tests

If the attorney-client privilege is to have any meaning, companies must know with reasonable certainty whether such dual-purpose communications will be protected. Unfortunately, there is anything but certainty at this time due to conflicting privilege tests for dual-purpose communications in the federal circuits, with one such test—referred to as the “the primary purpose” test—being particularly problematic. With the certiorari petition before it in the In re Grand Jury case, the Supreme Court has the opportunity to resolve the circuit split and to provide the certainty and clarity that is now lacking regarding this important issue.

In September 2021, the Ninth Circuit in In re Grand Jury adopted the “the primary purpose” test for dual-purpose communications.[2] The test requires the privilege claimant to establish that the primary purpose of the communication was legal. It has been criticized for, among other things, being impractical and unrealistic, because discerning whether the legal or business purpose was the primary purpose falsely presumes that all communications have a single, predominant purpose. Finding such a single, predominant purpose is often impossible and is usually a futile exercise in conjecture. The test thus guarantees excessive disputes over privilege requiring court resolution.

The “the primary purpose” test is in conflict with tests adopted in the D.C. and Seventh Circuits. The D.C. Circuit in 2014 adopted the “a primary purpose” test and affirmed that test in 2018.[3] Then Circuit Judge (now Supreme Court Justice) Kavanaugh authored both decisions. The “a primary purpose test” requires the privilege claimant to establish that the dual-purpose communication had a “significant legal purpose” without considering the relative importance of any business or non-legal purpose.

Both the “the” and “a” primary purpose tests conflict with a test the Seventh Circuit adopted in 1999.[4] The Seventh Circuit test, which applies to communications that mix tax preparation (i.e., non-legal) advice with legal advice regarding tax issues, rejects attorney-client protection for any mixed communication. Whether that test applies outside of the tax context is unclear.

The In re Grand Jury Petition for Writ of Certiorari

In April 2022, the privilege claimant in In re Grand Jury petitioned the Supreme Court to review the Ninth Circuit’s decision, urging the Court to resolve the circuit split and adopt the D.C. Circuit’s “a primary purpose” test. Amicus briefs in support of the petitioner have been filed by the Washington Legal Foundation, the Chamber of Commerce, and the California Lawyers Association—each urging the Court to resolve the split and adopt the D.C. Circuit’s test.

Prospects for Supreme Court Review and Adoption of the D.C. Circuit’s Test

The possibility that the Court will grant review appears to be fairly strong given the (a) existence of a circuit split; (b) the rare opportunity for the Court to address privilege; (c) Justice Kavanaugh’s interest in the question having previously authored opinions adopting the “a primary purpose” test in the D.C. Circuit; (d) the prevalence of dual-purpose communications; (e) the costs to litigants and to the courts of a privilege test that requires conjecture and invites privilege disputes; and (f) the importance of the Court’s role in interpreting the common law of privilege as provided in Fed. R. Evid. 501.

If the Court grants review, the choices before it will consist of (a) adopting the “the primary purpose” test; (b) adopting the D.C. Circuit’s “a primary purpose” test; or (c) devising a different standard or test (for example, whether the communication would have been made in the form used “but for” or “because of” the goal of obtaining or providing legal advice). The D.C. Circuit test appears to have the most appeal. It provides greater predictability and is more in line with the realities facing business entities. It is less subjective and easier for claimants and courts to apply. Additionally, its rationale promotes the goal of obtaining and providing fully informed legal advice, analysis, and services.

The countervailing concern is that the test may sweep too broadly by potentially protecting from discovery relevant business communications that would have been made regardless of whether the company concurrently sought legal advice. Hence, the scope of the privilege under the test could arguably be broader than necessary to achieve the goal of the attorney-client privilege—i.e., ensuring that clients can obtain fully informed legal advice. That concern was previously addressed in D.C. Circuit Judge Pillard’s concurrence in the Boehringercase[5], which argued that the D.C. Circuit test does not broaden the attorney-client privilege because it requires the claimant to prove with reasonable certainty that the legal purpose of a dual-purpose communication was significant and thus warrants the attorney-client privilege protection against discovery.

Whether a majority of Supreme Court justices will side with the “the primary purpose” test adopted by the Ninth Circuit in the In re Grand Jury case, the D.C. Circuit’s “a primary purpose” test, or another test—or whether the Court will take the issue on at all—remains to be seen.

Redgrave LLP will continue to follow the certiorari petition in In re Grand Jury and we will report on the implications of any decision of the Court regarding the appropriate privilege test for dual-purpose communications.