UNITED STATES COURT OF APPEALS
TENTH CIRCUIT
In re: GRAND JURY
PROCEEDINGS,
INTERVENOR,
Appellant,
No. 97-3389
v.
UNITED STATES of AMERICA,
Appellee.
ORDER
Filed August 31, 1998
Before EBEL, HENRY and BRISCOE, Circuit Judges.
Appellant’s petition for rehearing is granted. The Court will issue today a
revised opinion, and the opinion of July 15, 1998, is withdrawn. For the
information of the parties, we note the following two deletions to the opinion
filed on July 15, 1998. On page 11, first line on the page, the phrase “and (3) the
underlying attorney-client privilege has not been waived” is deleted. Also on
page 11, the last sentence in the penultimate paragraph, “Furthermore, it appears
that the Hospital has waived its attorney-client privilege with respect to these
documents, and as a result, there is no attorney-client privilege on which
Intervenor can base his joint-defense privilege claim” is deleted. Attached to this
order is the revised opinion.
The suggestion for rehearing en banc was transmitted to all of the judges
of the court who are in regular active service as required by Fed. R. App. P. 35.
As no member of the panel and no judge in regular active service on the court
requested that the court be polled, the suggestion is denied.
Entered for the Court
PATRICK FISHER, Clerk of Court
By:
Keith Nelson
Deputy Clerk
-2-
F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
AUG 31 1998
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT
In re: GRAND JURY
PROCEEDINGS,
INTERVENOR,
Appellant,
No. 97-3389
v.
UNITED STATES of AMERICA,
Appellee.
Appeal from the United States District Court
for the District of Kansas
(D.C. No. 97-2589)
James R. Wyrsch, (Jacqueline A. Cook with him on brief) Wyrsch Hobbs
Mirakian & Lee, P.C., Kansas City, Missouri, for Appellant.
Tanya J. Treadway, Assistant United States Attorney (Jackie N. Williams, United
States Attorney), Kansas City, Kansas, for Appellee.
Before EBEL, HENRY and BRISCOE, Circuit Judges.
EBEL, Circuit Judge.
Intervenor-Appellant appeals from the district court’s order denying his
motion to intervene and quash grand jury subpoenas for certain documents or, in
the alternative, for protective orders. We affirm.
BACKGROUND
This case stems from the same grand jury proceeding at issue in In re Grand
Jury Subpoenas (Jane Roe & John Doe), ___ F.3d ___, 1998 WL 247705 (10th
Cir. May 15, 1998). Intervenor, along with others, is a target of an ongoing
federal grand jury investigation. The Hospital, which employed Intervenor as
President and Chief Executive Officer during the relevant time periods, agreed to
produce certain documents in response to the grand jury’s subpoenas. Intervenor
moved to intervene and quash the subpoenas or, in the alternative, for protective
orders on the grounds of attorney-client privilege and the work product doctrine.
In a December 15, 1997, Order, the district court denied Intervenor’s motion to
intervene and ordered production of the documents. Intervenor filed a timely
notice of appeal as well as motions to stay the district court’s order. The court
below and this court, however, denied Intervenor’s stay motions, and Hospital
produced the disputed documents on January 21, 1998. At oral argument, the
government indicated that at least some of these documents already have been
provided to the grand jury.
-2-
DISCUSSION
In In re Grand Jury Subpoenas (Jane Roe & John Doe), this court affirmed
a district court order compelling the testimony of two of Intervenor’s attorneys.
See In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at
*10. In this case, on the other hand, Intervenor wishes to bar the production of
certain documents that he claims are covered by the attorney-client privilege and
work product doctrines.
Before addressing the merits, we must first confirm the parties’ assertion of
jurisdiction. The denial of a motion to quash a grand jury subpoena generally is
interlocutory and not immediately appealable. See In re Grand Jury Subpoenas
Dated December 7 & 8, Issued to Bob Stover, Chief of Albuquerque Police Dep’t,
40 F.3d 1096, 1099 (10th Cir. 1994). Nevertheless, we may entertain appellate
jurisdiction in such a case if the appeal falls within the special rule for
interlocutory appeals in Perlman v. United States, 247 U.S. 7, 13 (1918). See In
re Grand Jury Proceedings (Company X), 857 F.2d 710, 711 (10th Cir. 1988). As
this court explained in In re Grand Jury Proceedings (Company X), the Perlman
exception is available only when the party subject to the subpoena indicates that
he or she will comply with the court order upon a final adjudication of its validity
and an interlocutory appeal is sought by an intervenor who claims a justiciable
interest in preventing the disclosure of such documents. See id. at 711; see also
-3-
In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at *2
(applying Perlman doctrine in case where attorneys indicated that they would
ultimately comply if the grand jury subpoena were upheld). In this case, because
the disputed documents already have been turned over to the government, it is
clear that a final decision affirming the district court’s order would mean that no
other action would be needed to ensure compliance with the grand jury subpoena,
i.e., the documents would continue to be available to the government and the
grand jury. Thus, although this case is somewhat different from the traditional
Perlman context, we find that we have jurisdiction to hear this appeal. See
Perlman, 247 U.S. at 13.
Though we may properly review this interlocutory appeal under Perlman,
the fact that at least some of the disputed documents already have been reviewed
by the grand jury raises a question of mootness. A case can become moot during
the pendency of an appeal when an event occurs that “makes it impossible for the
court to grant ‘any effectual relief whatever’ to a prevailing party.” See Church
of Scientology v. United States, 506 U.S. 9, 12 (1992) (quoting Mills v. Green,
159 U.S. 651, 653 (1895)). In this case, we conclude that despite the proverbial
cat’s escape from its bag, Intervenor’s appeal is not moot because, in the event of
a successful decision on the merits, Intervenor still might obtain some modicum
of meaningful relief, e.g., an order requiring the return of the documents and the
-4-
destruction of any copies held by the government. See id. at 12-13 (holding
appeal of order requiring production of tape-recorded conversations was not moot
despite fact that tapes had been provided to the government); In re Grand Jury
Subpoenas Dated December 7 & 8, 40 F.3d at 1099-1100 (holding appeal of
subpoena for police department internal affairs reports was not moot despite fact
that reports had been provided to the grand jury).
Turning now to the merits of Intervenor’s argument, we note that in In re
Grand Jury Subpoenas (Jane Roe & John Doe) this court adopted the following
five-part test developed by the Second and Third Circuits in In re Bevill, Bresler
& Schulman Asset Mgmt. Corp., 805 F.2d 120, 123 (3d Cir. 1986), and United
States v. International Bhd. of Teamsters, Chauffeurs, Warehousemen & Helpers,
119 F.3d 210, 215 (2d Cir. 1997), “to determine whether an officer may assert a
personal privilege with respect to conversations with corporate counsel despite
the fact that the privilege generally belongs to the corporation”:
First, they must show they approached [counsel] for the purpose of seeking
legal advice. Second, they must demonstrate that when they approached
[counsel] they made it clear that they were seeking legal advice in their
individual rather than in their representative capacities. Third, they must
demonstrate that the [counsel] saw fit to communicate with them in their
individual capacities, knowing that a possible conflict could arise. Fourth,
they must prove that their conversations with [counsel] were confidential.
And, fifth, they must show that the substance of their conversations with
[counsel] did not concern matters within the company or the general affairs
of the company.
-5-
In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at *4
(citations and quotations omitted).
Relying on this five-part test from In re Bevill, the district court found that
Intervenor could not establish the existence of a personal attorney-client privilege
because all of the documents at issue only pertained to “his acts as a corporate
officer” of the Hospital, and thus, they did not satisfy the fifth prong of the test.
See In re Bevill, 805 F.2d at 123. In addition, the district court held that most of
the documents could not satisfy the fourth prong of In re Bevill because other
corporate officers or other third parties also received copies, and thus
confidentiality was not preserved between Intervenor and the corporate attorneys.
See id.
We conclude that the district court erred in finding that Intervenor, as a
matter of law, could not establish the existence of a personal attorney-client
relationship under the fifth prong of In re Bevill simply because the subject
matter of the documents related to corporate activities. The fifth prong of In re
Bevill, properly interpreted, only precludes an officer from asserting an individual
attorney client privilege when the communication concerns the corporation’s
rights and responsibilities. However, if the communication between a corporate
officer and corporate counsel specifically focuses upon the individual officer’s
personal rights and liabilities, then the fifth prong of In re Bevill can be satisfied
-6-
even though the general subject matter of the conversation pertains to matters
within the general affairs of the company. For example, a corporate officer’s
discussion with his corporation’s counsel may still be protected by a personal,
individual attorney-client privilege when the conversation specifically concerns
the officer’s personal liability for jail time based on conduct interrelated with
corporate affairs. Such a conversation would satisfy the fifth prong of In re
Bevill test because the officer’s potential prison sentence is outside the scope of
the corporation’s concerns and affairs.
In In re Grand Jury Subpoenas (Jane Roe & John Doe), this court found that
a limited attorney-client privilege existed between Intervenor and corporate
counsel, but only as to “that very small portion of communications in which
Intervenor sought legal advice as to his personal liability without regard to any
corporate considerations” and did not “extend to communications made while
third parties were present nor does it extend to communications in which both
corporate and individual liability were discussed.” In re Grand Jury Subpoenas
(Jane Roe & John Doe), 1998 WL 247705, at *4. Thus, there this court
reaffirmed the traditional rule that a corporate officer, in certain circumstances,
could show the existence of a personal attorney-client privilege for
communications with corporate counsel, even if the subject matter of the
communications involved corporate affairs. See, e.g., Wylie v. Marley Co., 891
-7-
F.2d 1463, 1471-72 (10th Cir. 1989) (privilege covered officer’s communications
with corporate counsel regarding personal rights under corporate employment
agreement).
Nevertheless, such an attorney-client privilege can exist only when the
officer discusses his or her personal liability, legal rights, or actions, as
distinguished from the corporation’s rights and responsibilities. In such
circumstances, the officer might have a legitimate expectation of a confidential
attorney-client relationship and might be able to shield those communications
under the attorney-client privilege (assuming the first four prongs of In re Bevill
are satisfied). As a result, Intervenor is not barred as a matter of law from
showing that a personal attorney-client relationship may have existed simply
because the documents in question touched on the subject matter of corporate
actions.
However, whether or not Intervenor might have been able to show the
existence of a personal attorney-client relationship with corporate counsel, he still
had the burden in this case of showing that the privilege actually applies to the
documents at issue. See Motley v. Marathon Oil Co., 71 F.3d 1547, 1550 (10th
Cir. 1995), cert. denied, 517 U.S. 1190 (1996). In this respect he falters for
several reasons. First, the appellant has not produced for our review the
particular documents at issue nor has he otherwise adequately demonstrated in the
-8-
record that any of the documents ordered produced were limited to the topic of his
individual legal rights and responsibilities. (In fact, the limited descriptions of
the documents provided to us by the appellant seems to negate such an inference.)
Thus, as to the particular documents at issue, Intervenor has failed to establish
that the documents satisfy the fifth prong of In re Bevill.
In addition, Intervenor has failed to establish that the documents satisfy the
fourth prong of In re Bevill, dealing with confidentiality. The district court
found:
[T]he majority of documents are corporate letters or memoranda sent to
third parties in addition to, or instead of, [Intervenor]. With respect to
these documents . . . [Intervenor] has failed to demonstrate . . . that the
subject matter was confidential. A number of other corporate documents
are letters sent between third parties, where [Intervenor] is not even copied
on the document. Further, [Intervenor] has not attempted to explain how he
can claim a personal attorney-client privilege as to other documents, which
do not reflect either [of his attorneys] as a part to the document. 1
Nowhere on appeal does Intervenor identify specific documents to demonstrate
that the district court clearly erred in these factual determinations. Because
Intervenor did not meet his burden of showing that the documents at issue were
confidential communications between him and the corporate attorneys acting in
1
As this court noted in In re Grand Jury Subpoenas (Jane Roe & John Doe),
1998 WL 247705, at *3, “We review the factual findings underlying the court’s
attorney-client privilege ruling for clear error and purely legal questions de
novo.”
-9-
their capacity as his personal lawyer, we affirm the district court’s ruling that
Intervenor was not able to demonstrate the existence of a personal attorney-client
privilege with respect to the documents at issue.
Finally, the district court held that Intervenor “failed to meet his burden of
demonstrating that each of the documents to which he is claiming work product
protection was in fact prepared in anticipation of litigation. The documents
appear to be prepared in the regular course of business.” The work product
privilege only extends to documents prepared by an attorney for the client in
anticipation of litigation. See In re Grand Jury Proceedings (Vargas), 727 F.2d
941, 945 (10th Cir. 1984). The party asserting work product privilege has the
burden of showing the applicability of the doctrine. See Barclaysamerican Corp.
v. Kane, 746 F.2d 653, 656 (10th Cir. 1984). Intervenor has not established that
the district court clearly erred in finding that the documents were not prepared in
anticipation of litigation.
For much the same reasons, we reject Intervenor’s arguments concerning a
joint-defense privilege. Intervenor contends that his interest in protecting the
confidentiality of the documents at issue here is protected by the attorney-client
privilege between the Hospital and its lawyers because he had a “joint-defense”
relationship with the Hospital. However, to establish a joint-defense privilege,
the Intervenor was required to demonstrate (1) the documents were made in the
- 10 -
course of a joint-defense effort; and (2) the documents were designed to further
that effort. See United States v. Bay State Ambulance & Hosp. Rental Serv., Inc.,
874 F.2d 20, 28 (1st Cir. 1989); see also United States v. Evans, 113 F.3d 1457,
1467 (7th Cir. 1997) (quoting United States v. Schwimmer, 892 F.2d 237, 243-44
(2d Cir. 1989) (noting that the “joint-defense privilege” is more properly labeled a
“common interest rule”)). As the district court correctly found, Intervenor has
failed to meet the elements of a joint-defense privilege because he has failed to
produce any evidence, express or implied, of a joint-defense agreement with the
Hospital, and he has failed to show how the documents at issue here furthered the
putative joint-defense strategy.
Because of our rulings on the issues above, we need not address, and do not
address, the other issues raised by Intervenor.
CONCLUSION
For these reasons, we AFFIRM the district court’s order.
- 11 -
UNITED STATES COURT OF APPEALS
TENTH CIRCUIT
In re: GRAND JURY
PROCEEDINGS,
INTERVENOR,
Appellant,
No. 97-3389
v.
UNITED STATES of AMERICA,
Appellee.
ORDER
Filed August 31, 1998
Before EBEL, HENRY and BRISCOE, Circuit Judges.
Appellant’s petition for rehearing is granted. The Court will issue today a
revised opinion, and the opinion of July 15, 1998, is withdrawn. For the
information of the parties, we note the following two deletions to the opinion
filed on July 15, 1998. On page 11, first line on the page, the phrase “and (3) the
underlying attorney-client privilege has not been waived” is deleted. Also on
page 11, the last sentence in the penultimate paragraph, “Furthermore, it appears
that the Hospital has waived its attorney-client privilege with respect to these
documents, and as a result, there is no attorney-client privilege on which
Intervenor can base his joint-defense privilege claim” is deleted. Attached to this
order is the revised opinion.
The suggestion for rehearing en banc was transmitted to all of the judges
of the court who are in regular active service as required by Fed. R. App. P. 35.
As no member of the panel and no judge in regular active service on the court
requested that the court be polled, the suggestion is denied.
Entered for the Court
PATRICK FISHER, Clerk of Court
By:
Keith Nelson
Deputy Clerk
-2-
F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
AUG 31 1998
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT
In re: GRAND JURY
PROCEEDINGS,
INTERVENOR,
Appellant,
No. 97-3389
v.
UNITED STATES of AMERICA,
Appellee.
Appeal from the United States District Court
for the District of Kansas
(D.C. No. 97-2589)
James R. Wyrsch, (Jacqueline A. Cook with him on brief) Wyrsch Hobbs
Mirakian & Lee, P.C., Kansas City, Missouri, for Appellant.
Tanya J. Treadway, Assistant United States Attorney (Jackie N. Williams, United
States Attorney), Kansas City, Kansas, for Appellee.
Before EBEL, HENRY and BRISCOE, Circuit Judges.
EBEL, Circuit Judge.
Intervenor-Appellant appeals from the district court’s order denying his
motion to intervene and quash grand jury subpoenas for certain documents or, in
the alternative, for protective orders. We affirm.
BACKGROUND
This case stems from the same grand jury proceeding at issue in In re Grand
Jury Subpoenas (Jane Roe & John Doe), ___ F.3d ___, 1998 WL 247705 (10th
Cir. May 15, 1998). Intervenor, along with others, is a target of an ongoing
federal grand jury investigation. The Hospital, which employed Intervenor as
President and Chief Executive Officer during the relevant time periods, agreed to
produce certain documents in response to the grand jury’s subpoenas. Intervenor
moved to intervene and quash the subpoenas or, in the alternative, for protective
orders on the grounds of attorney-client privilege and the work product doctrine.
In a December 15, 1997, Order, the district court denied Intervenor’s motion to
intervene and ordered production of the documents. Intervenor filed a timely
notice of appeal as well as motions to stay the district court’s order. The court
below and this court, however, denied Intervenor’s stay motions, and Hospital
produced the disputed documents on January 21, 1998. At oral argument, the
government indicated that at least some of these documents already have been
provided to the grand jury.
-2-
DISCUSSION
In In re Grand Jury Subpoenas (Jane Roe & John Doe), this court affirmed
a district court order compelling the testimony of two of Intervenor’s attorneys.
See In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at
*10. In this case, on the other hand, Intervenor wishes to bar the production of
certain documents that he claims are covered by the attorney-client privilege and
work product doctrines.
Before addressing the merits, we must first confirm the parties’ assertion of
jurisdiction. The denial of a motion to quash a grand jury subpoena generally is
interlocutory and not immediately appealable. See In re Grand Jury Subpoenas
Dated December 7 & 8, Issued to Bob Stover, Chief of Albuquerque Police Dep’t,
40 F.3d 1096, 1099 (10th Cir. 1994). Nevertheless, we may entertain appellate
jurisdiction in such a case if the appeal falls within the special rule for
interlocutory appeals in Perlman v. United States, 247 U.S. 7, 13 (1918). See In
re Grand Jury Proceedings (Company X), 857 F.2d 710, 711 (10th Cir. 1988). As
this court explained in In re Grand Jury Proceedings (Company X), the Perlman
exception is available only when the party subject to the subpoena indicates that
he or she will comply with the court order upon a final adjudication of its validity
and an interlocutory appeal is sought by an intervenor who claims a justiciable
interest in preventing the disclosure of such documents. See id. at 711; see also
-3-
In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at *2
(applying Perlman doctrine in case where attorneys indicated that they would
ultimately comply if the grand jury subpoena were upheld). In this case, because
the disputed documents already have been turned over to the government, it is
clear that a final decision affirming the district court’s order would mean that no
other action would be needed to ensure compliance with the grand jury subpoena,
i.e., the documents would continue to be available to the government and the
grand jury. Thus, although this case is somewhat different from the traditional
Perlman context, we find that we have jurisdiction to hear this appeal. See
Perlman, 247 U.S. at 13.
Though we may properly review this interlocutory appeal under Perlman,
the fact that at least some of the disputed documents already have been reviewed
by the grand jury raises a question of mootness. A case can become moot during
the pendency of an appeal when an event occurs that “makes it impossible for the
court to grant ‘any effectual relief whatever’ to a prevailing party.” See Church
of Scientology v. United States, 506 U.S. 9, 12 (1992) (quoting Mills v. Green,
159 U.S. 651, 653 (1895)). In this case, we conclude that despite the proverbial
cat’s escape from its bag, Intervenor’s appeal is not moot because, in the event of
a successful decision on the merits, Intervenor still might obtain some modicum
of meaningful relief, e.g., an order requiring the return of the documents and the
-4-
destruction of any copies held by the government. See id. at 12-13 (holding
appeal of order requiring production of tape-recorded conversations was not moot
despite fact that tapes had been provided to the government); In re Grand Jury
Subpoenas Dated December 7 & 8, 40 F.3d at 1099-1100 (holding appeal of
subpoena for police department internal affairs reports was not moot despite fact
that reports had been provided to the grand jury).
Turning now to the merits of Intervenor’s argument, we note that in In re
Grand Jury Subpoenas (Jane Roe & John Doe) this court adopted the following
five-part test developed by the Second and Third Circuits in In re Bevill, Bresler
& Schulman Asset Mgmt. Corp., 805 F.2d 120, 123 (3d Cir. 1986), and United
States v. International Bhd. of Teamsters, Chauffeurs, Warehousemen & Helpers,
119 F.3d 210, 215 (2d Cir. 1997), “to determine whether an officer may assert a
personal privilege with respect to conversations with corporate counsel despite
the fact that the privilege generally belongs to the corporation”:
First, they must show they approached [counsel] for the purpose of seeking
legal advice. Second, they must demonstrate that when they approached
[counsel] they made it clear that they were seeking legal advice in their
individual rather than in their representative capacities. Third, they must
demonstrate that the [counsel] saw fit to communicate with them in their
individual capacities, knowing that a possible conflict could arise. Fourth,
they must prove that their conversations with [counsel] were confidential.
And, fifth, they must show that the substance of their conversations with
[counsel] did not concern matters within the company or the general affairs
of the company.
-5-
In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at *4
(citations and quotations omitted).
Relying on this five-part test from In re Bevill, the district court found that
Intervenor could not establish the existence of a personal attorney-client privilege
because all of the documents at issue only pertained to “his acts as a corporate
officer” of the Hospital, and thus, they did not satisfy the fifth prong of the test.
See In re Bevill, 805 F.2d at 123. In addition, the district court held that most of
the documents could not satisfy the fourth prong of In re Bevill because other
corporate officers or other third parties also received copies, and thus
confidentiality was not preserved between Intervenor and the corporate attorneys.
See id.
We conclude that the district court erred in finding that Intervenor, as a
matter of law, could not establish the existence of a personal attorney-client
relationship under the fifth prong of In re Bevill simply because the subject
matter of the documents related to corporate activities. The fifth prong of In re
Bevill, properly interpreted, only precludes an officer from asserting an individual
attorney client privilege when the communication concerns the corporation’s
rights and responsibilities. However, if the communication between a corporate
officer and corporate counsel specifically focuses upon the individual officer’s
personal rights and liabilities, then the fifth prong of In re Bevill can be satisfied
-6-
even though the general subject matter of the conversation pertains to matters
within the general affairs of the company. For example, a corporate officer’s
discussion with his corporation’s counsel may still be protected by a personal,
individual attorney-client privilege when the conversation specifically concerns
the officer’s personal liability for jail time based on conduct interrelated with
corporate affairs. Such a conversation would satisfy the fifth prong of In re
Bevill test because the officer’s potential prison sentence is outside the scope of
the corporation’s concerns and affairs.
In In re Grand Jury Subpoenas (Jane Roe & John Doe), this court found that
a limited attorney-client privilege existed between Intervenor and corporate
counsel, but only as to “that very small portion of communications in which
Intervenor sought legal advice as to his personal liability without regard to any
corporate considerations” and did not “extend to communications made while
third parties were present nor does it extend to communications in which both
corporate and individual liability were discussed.” In re Grand Jury Subpoenas
(Jane Roe & John Doe), 1998 WL 247705, at *4. Thus, there this court
reaffirmed the traditional rule that a corporate officer, in certain circumstances,
could show the existence of a personal attorney-client privilege for
communications with corporate counsel, even if the subject matter of the
communications involved corporate affairs. See, e.g., Wylie v. Marley Co., 891
-7-
F.2d 1463, 1471-72 (10th Cir. 1989) (privilege covered officer’s communications
with corporate counsel regarding personal rights under corporate employment
agreement).
Nevertheless, such an attorney-client privilege can exist only when the
officer discusses his or her personal liability, legal rights, or actions, as
distinguished from the corporation’s rights and responsibilities. In such
circumstances, the officer might have a legitimate expectation of a confidential
attorney-client relationship and might be able to shield those communications
under the attorney-client privilege (assuming the first four prongs of In re Bevill
are satisfied). As a result, Intervenor is not barred as a matter of law from
showing that a personal attorney-client relationship may have existed simply
because the documents in question touched on the subject matter of corporate
actions.
However, whether or not Intervenor might have been able to show the
existence of a personal attorney-client relationship with corporate counsel, he still
had the burden in this case of showing that the privilege actually applies to the
documents at issue. See Motley v. Marathon Oil Co., 71 F.3d 1547, 1550 (10th
Cir. 1995), cert. denied, 517 U.S. 1190 (1996). In this respect he falters for
several reasons. First, the appellant has not produced for our review the
particular documents at issue nor has he otherwise adequately demonstrated in the
-8-
record that any of the documents ordered produced were limited to the topic of his
individual legal rights and responsibilities. (In fact, the limited descriptions of
the documents provided to us by the appellant seems to negate such an inference.)
Thus, as to the particular documents at issue, Intervenor has failed to establish
that the documents satisfy the fifth prong of In re Bevill.
In addition, Intervenor has failed to establish that the documents satisfy the
fourth prong of In re Bevill, dealing with confidentiality. The district court
found:
[T]he majority of documents are corporate letters or memoranda sent to
third parties in addition to, or instead of, [Intervenor]. With respect to
these documents . . . [Intervenor] has failed to demonstrate . . . that the
subject matter was confidential. A number of other corporate documents
are letters sent between third parties, where [Intervenor] is not even copied
on the document. Further, [Intervenor] has not attempted to explain how he
can claim a personal attorney-client privilege as to other documents, which
do not reflect either [of his attorneys] as a part to the document. 1
Nowhere on appeal does Intervenor identify specific documents to demonstrate
that the district court clearly erred in these factual determinations. Because
Intervenor did not meet his burden of showing that the documents at issue were
confidential communications between him and the corporate attorneys acting in
1
As this court noted in In re Grand Jury Subpoenas (Jane Roe & John Doe),
1998 WL 247705, at *3, “We review the factual findings underlying the court’s
attorney-client privilege ruling for clear error and purely legal questions de
novo.”
-9-
their capacity as his personal lawyer, we affirm the district court’s ruling that
Intervenor was not able to demonstrate the existence of a personal attorney-client
privilege with respect to the documents at issue.
Finally, the district court held that Intervenor “failed to meet his burden of
demonstrating that each of the documents to which he is claiming work product
protection was in fact prepared in anticipation of litigation. The documents
appear to be prepared in the regular course of business.” The work product
privilege only extends to documents prepared by an attorney for the client in
anticipation of litigation. See In re Grand Jury Proceedings (Vargas), 727 F.2d
941, 945 (10th Cir. 1984). The party asserting work product privilege has the
burden of showing the applicability of the doctrine. See Barclaysamerican Corp.
v. Kane, 746 F.2d 653, 656 (10th Cir. 1984). Intervenor has not established that
the district court clearly erred in finding that the documents were not prepared in
anticipation of litigation.
For much the same reasons, we reject Intervenor’s arguments concerning a
joint-defense privilege. Intervenor contends that his interest in protecting the
confidentiality of the documents at issue here is protected by the attorney-client
privilege between the Hospital and its lawyers because he had a “joint-defense”
relationship with the Hospital. However, to establish a joint-defense privilege,
the Intervenor was required to demonstrate (1) the documents were made in the
- 10 -
course of a joint-defense effort; and (2) the documents were designed to further
that effort. See United States v. Bay State Ambulance & Hosp. Rental Serv., Inc.,
874 F.2d 20, 28 (1st Cir. 1989); see also United States v. Evans, 113 F.3d 1457,
1467 (7th Cir. 1997) (quoting United States v. Schwimmer, 892 F.2d 237, 243-44
(2d Cir. 1989) (noting that the “joint-defense privilege” is more properly labeled a
“common interest rule”)). As the district court correctly found, Intervenor has
failed to meet the elements of a joint-defense privilege because he has failed to
produce any evidence, express or implied, of a joint-defense agreement with the
Hospital, and he has failed to show how the documents at issue here furthered the
putative joint-defense strategy.
Because of our rulings on the issues above, we need not address, and do not
address, the other issues raised by Intervenor.
CONCLUSION
For these reasons, we AFFIRM the district court’s order.
- 11 -
F I L E D
United States Court of Appeals
Tenth Circuit
PUBLISH
JUL 15 1998
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT
In re: GRAND JURY
PROCEEDINGS,
INTERVENOR,
Appellant,
No. 97-3389
v.
UNITED STATES of AMERICA,
Appellee.
Appeal from the United States District Court
for the District of Kansas
(D.C. No. 97-2589)
James R. Wyrsch, (Jacqueline A. Cook with him on brief) Wyrsch Hobbs
Mirakian & Lee, P.C., Kansas City, Missouri, for Appellant.
Tanya J. Treadway, Assistant United States Attorney (Jackie N. Williams, United
States Attorney), Kansas City, Kansas, for Appellee.
Before EBEL, HENRY and BRISCOE, Circuit Judges.
EBEL, Circuit Judge.
Intervenor-Appellant appeals from the district court’s order denying his
motion to intervene and quash grand jury subpoenas for certain documents or, in
the alternative, for protective orders. We affirm.
BACKGROUND
This case stems from the same grand jury proceeding at issue in In re Grand
Jury Subpoenas (Jane Roe & John Doe), ___ F.3d ___, 1998 WL 247705 (10th
Cir. May 15, 1998). Intervenor, along with others, is a target of an ongoing
federal grand jury investigation. The Hospital, which employed Intervenor as
President and Chief Executive Officer during the relevant time periods, agreed to
produce certain documents in response to the grand jury’s subpoenas. Intervenor
moved to intervene and quash the subpoenas or, in the alternative, for protective
orders on the grounds of attorney-client privilege and the work product doctrine.
In a December 15, 1997, Order, the district court denied Intervenor’s motion to
intervene and ordered production of the documents. Intervenor filed a timely
notice of appeal as well as motions to stay the district court’s order. The court
below and this court, however, denied Intervenor’s stay motions, and Hospital
produced the disputed documents on January 21, 1998. At oral argument, the
government indicated that at least some of these documents already have been
provided to the grand jury.
-2-
DISCUSSION
In In re Grand Jury Subpoenas (Jane Roe & John Doe), this court affirmed
a district court order compelling the testimony of two of Intervenor’s attorneys.
See In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at
*10. In this case, on the other hand, Intervenor wishes to bar the production of
certain documents that he claims are covered by the attorney-client privilege and
work product doctrines.
Before addressing the merits, we must first confirm the parties’ assertion of
jurisdiction. The denial of a motion to quash a grand jury subpoena generally is
interlocutory and not immediately appealable. See In re Grand Jury Subpoenas
Dated December 7 & 8, Issued to Bob Stover, Chief of Albuquerque Police Dep’t,
40 F.3d 1096, 1099 (10th Cir. 1994). Nevertheless, we may entertain appellate
jurisdiction in such a case if the appeal falls within the special rule for
interlocutory appeals in Perlman v. United States, 247 U.S. 7, 13 (1918). See In
re Grand Jury Proceedings (Company X), 857 F.2d 710, 711 (10th Cir. 1988). As
this court explained in In re Grand Jury Proceedings (Company X), the Perlman
exception is available only when the party subject to the subpoena indicates that
he or she will comply with the court order upon a final adjudication of its validity
and an interlocutory appeal is sought by an intervenor who claims a justiciable
interest in preventing the disclosure of such documents. See id. at 711; see also
-3-
In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at *2
(applying Perlman doctrine in case where attorneys indicated that they would
ultimately comply if the grand jury subpoena were upheld). In this case, because
the disputed documents already have been turned over to the government, it is
clear that a final decision affirming the district court’s order would mean that no
other action would be needed to ensure compliance with the grand jury subpoena,
i.e., the documents would continue to be available to the government and the
grand jury. Thus, although this case is somewhat different from the traditional
Perlman context, we find that we have jurisdiction to hear this appeal. See
Perlman, 247 U.S. at 13.
Though we may properly review this interlocutory appeal under Perlman,
the fact that at least some of the disputed documents already have been reviewed
by the grand jury raises a question of mootness. A case can become moot during
the pendency of an appeal when an event occurs that “makes it impossible for the
court to grant ‘any effectual relief whatever’ to a prevailing party.” See Church
of Scientology v. United States, 506 U.S. 9, 12 (1992) (quoting Mills v. Green,
159 U.S. 651, 653 (1895)). In this case, we conclude that despite the proverbial
cat’s escape from its bag, Intervenor’s appeal is not moot because, in the event of
a successful decision on the merits, Intervenor still might obtain some modicum
of meaningful relief, e.g., an order requiring the return of the documents and the
-4-
destruction of any copies held by the government. See id. at 12-13 (holding
appeal of order requiring production of tape-recorded conversations was not moot
despite fact that tapes had been provided to the government); In re Grand Jury
Subpoenas Dated December 7 & 8, 40 F.3d at 1099-1100 (holding appeal of
subpoena for police department internal affairs reports was not moot despite fact
that reports had been provided to the grand jury).
Turning now to the merits of Intervenor’s argument, we note that in In re
Grand Jury Subpoenas (Jane Roe & John Doe) this court adopted the following
five-part test developed by the Second and Third Circuits in In re Bevill, Bresler
& Schulman Asset Mgmt. Corp., 805 F.2d 120, 123 (3d Cir. 1986), and United
States v. International Bhd. of Teamsters, Chauffeurs, Warehousemen & Helpers,
119 F.3d 210, 215 (2d Cir. 1997), “to determine whether an officer may assert a
personal privilege with respect to conversations with corporate counsel despite
the fact that the privilege generally belongs to the corporation”:
First, they must show they approached [counsel] for the purpose of seeking
legal advice. Second, they must demonstrate that when they approached
[counsel] they made it clear that they were seeking legal advice in their
individual rather than in their representative capacities. Third, they must
demonstrate that the [counsel] saw fit to communicate with them in their
individual capacities, knowing that a possible conflict could arise. Fourth,
they must prove that their conversations with [counsel] were confidential.
And, fifth, they must show that the substance of their conversations with
[counsel] did not concern matters within the company or the general affairs
of the company.
-5-
In re Grand Jury Subpoenas (Jane Roe & John Doe), 1998 WL 247705, at *4
(citations and quotations omitted).
Relying on this five-part test from In re Bevill, the district court found that
Intervenor could not establish the existence of a personal attorney-client privilege
because all of the documents at issue only pertained to “his acts as a corporate
officer” of the Hospital, and thus, they did not satisfy the fifth prong of the test.
See In re Bevill, 805 F.2d at 123. In addition, the district court held that most of
the documents could not satisfy the fourth prong of In re Bevill because other
corporate officers or other third parties also received copies, and thus
confidentiality was not preserved between Intervenor and the corporate attorneys.
See id.
We conclude that the district court erred in finding that Intervenor, as a
matter of law, could not establish the existence of a personal attorney-client
relationship under the fifth prong of In re Bevill simply because the subject
matter of the documents related to corporate activities. The fifth prong of In re
Bevill, properly interpreted, only precludes an officer from asserting an individual
attorney client privilege when the communication concerns the corporation’s
rights and responsibilities. However, if the communication between a corporate
officer and corporate counsel specifically focuses upon the individual officer’s
personal rights and liabilities, then the fifth prong of In re Bevill can be satisfied
-6-
even though the general subject matter of the conversation pertains to matters
within the general affairs of the company. For example, a corporate officer’s
discussion with his corporation’s counsel may still be protected by a personal,
individual attorney-client privilege when the conversation specifically concerns
the officer’s personal liability for jail time based on conduct interrelated with
corporate affairs. Such a conversation would satisfy the fifth prong of In re
Bevill test because the officer’s potential prison sentence is outside the scope of
the corporation’s concerns and affairs.
In In re Grand Jury Subpoenas (Jane Roe & John Doe), this court found that
a limited attorney-client privilege existed between Intervenor and corporate
counsel, but only as to “that very small portion of communications in which
Intervenor sought legal advice as to his personal liability without regard to any
corporate considerations” and did not “extend to communications made while
third parties were present nor does it extend to communications in which both
corporate and individual liability were discussed.” In re Grand Jury Subpoenas
(Jane Roe & John Doe), 1998 WL 247705, at *4. Thus, there this court
reaffirmed the traditional rule that a corporate officer, in certain circumstances,
could show the existence of a personal attorney-client privilege for
communications with corporate counsel, even if the subject matter of the
communications involved corporate affairs. See, e.g., Wylie v. Marley Co., 891
-7-
F.2d 1463, 1471-72 (10th Cir. 1989) (privilege covered officer’s communications
with corporate counsel regarding personal rights under corporate employment
agreement).
Nevertheless, such an attorney-client privilege can exist only when the
officer discusses his or her personal liability, legal rights, or actions, as
distinguished from the corporation’s rights and responsibilities. In such
circumstances, the officer might have a legitimate expectation of a confidential
attorney-client relationship and might be able to shield those communications
under the attorney-client privilege (assuming the first four prongs of In re Bevill
are satisfied). As a result, Intervenor is not barred as a matter of law from
showing that a personal attorney-client relationship may have existed simply
because the documents in question touched on the subject matter of corporate
actions.
However, whether or not Intervenor might have been able to show the
existence of a personal attorney-client relationship with corporate counsel, he still
had the burden in this case of showing that the privilege actually applies to the
documents at issue. See Motley v. Marathon Oil Co., 71 F.3d 1547, 1550 (10th
Cir. 1995), cert. denied, 517 U.S. 1190 (1996). In this respect he falters for
several reasons. First, the appellant has not produced for our review the
particular documents at issue nor has he otherwise adequately demonstrated in the
-8-
record that any of the documents ordered produced were limited to the topic of his
individual legal rights and responsibilities. (In fact, the limited descriptions of
the documents provided to us by the appellant seems to negate such an inference.)
Thus, as to the particular documents at issue, Intervenor has failed to establish
that the documents satisfy the fifth prong of In re Bevill.
In addition, Intervenor has failed to establish that the documents satisfy the
fourth prong of In re Bevill, dealing with confidentiality. The district court
found:
[T]he majority of documents are corporate letters or memoranda sent to
third parties in addition to, or instead of, [Intervenor]. With respect to
these documents . . . [Intervenor] has failed to demonstrate . . . that the
subject matter was confidential. A number of other corporate documents
are letters sent between third parties, where [Intervenor] is not even copied
on the document. Further, [Intervenor] has not attempted to explain how he
can claim a personal attorney-client privilege as to other documents, which
do not reflect either [of his attorneys] as a part to the document. 1
Nowhere on appeal does Intervenor identify specific documents to demonstrate
that the district court clearly erred in these factual determinations. Because
Intervenor did not meet his burden of showing that the documents at issue were
confidential communications between him and the corporate attorneys acting in
their capacity as his personal lawyer, we affirm the district court’s ruling that
1
As this court noted in In re Grand Jury Subpoenas (Jane Roe & John Doe),
1998 WL 247705, at *3, “We review the factual findings underlying the court’s
attorney-client privilege ruling for clear error and purely legal questions de
novo.”
-9-
Intervenor was not able to demonstrate the existence of a personal attorney-client
privilege with respect to the documents at issue.
Finally, the district court held that Intervenor “failed to meet his burden of
demonstrating that each of the documents to which he is claiming work product
protection was in fact prepared in anticipation of litigation. The documents
appear to be prepared in the regular course of business.” The work product
privilege only extends to documents prepared by an attorney for the client in
anticipation of litigation. See In re Grand Jury Proceedings (Vargas), 727 F.2d
941, 945 (10th Cir. 1984). The party asserting work product privilege has the
burden of showing the applicability of the doctrine. See Barclaysamerican Corp.
v. Kane, 746 F.2d 653, 656 (10th Cir. 1984). Intervenor has not established that
the district court clearly erred in finding that the documents were not prepared in
anticipation of litigation.
For much the same reasons, we reject Intervenor’s arguments concerning a
joint-defense privilege. Intervenor contends that his interest in protecting the
confidentiality of the documents at issue here is protected by the attorney-client
privilege between the Hospital and its lawyers because he had a “joint-defense”
relationship with the Hospital. However, to establish a joint-defense privilege,
the Intervenor was required to demonstrate (1) the documents were made in the
course of a joint-defense effort; (2) the documents were designed to further that
- 10 -
effort; and (3) the underlying attorney-client privilege has not been waived. See
United States v. Bay State Ambulance & Hosp. Rental Serv., Inc., 874 F.2d 20, 28
(1st Cir. 1989); see also United States v. Evans, 113 F.3d 1457, 1467 (7th Cir.
1997) (quoting United States v. Schwimmer, 892 F.2d 237, 243-44 (2d Cir. 1989)
(noting that the “joint-defense privilege” is more properly labeled a “common
interest rule”)). As the district court correctly found, Intervenor has failed to
meet the elements of a joint-defense privilege because he has failed to produce
any evidence, express or implied, of a joint-defense agreement with the Hospital,
and he has failed to show how the documents at issue here furthered the putative
joint-defense strategy. Furthermore, it appears that the Hospital has waived its
attorney-client privilege with respect to these documents, and as a result, there is
no attorney-client privilege on which Intervenor can base his joint-defense
privilege claim.
Because of our rulings on the issues above, we need not address, and do not
address, the other issues raised by Intervenor.
CONCLUSION
For these reasons, we AFFIRM the district court’s order.
- 11 -