United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued May 11, 1998 Decided June 19, 1998
No. 98-3032
In re: Sealed Case
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Appeal from the United States District Court
for the District of Columbia
(No. 98ms00003)
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Before: Henderson, Rogers and Tatel, Circuit Judges.
Opinion for the Court filed by Tatel, Circuit Judge.
Tatel, Circuit Judge: Directed by a grand jury subpoena
to produce notes and other written materials prepared in
connection with work for a client, a lawyer claimed that the
attorney work-product privilege protected the materials from
disclosure. The district court, finding that a "specific claim"
had not arisen at the time the lawyer prepared the docu-
ments, held the privilege inapplicable. Because the work-
product privilege in this case turns not on whether a specific
claim existed, but instead on whether, under all the circum-
stances, the lawyer prepared the materials "in anticipation of
litigation," we reverse and remand.
I
Shortly after the Chairman of the Republican National
Committee founded a non-profit think tank called the Nation-
al Policy Forum, the RNC loaned the newly formed organiza-
tion over $2.5 million. From the beginning, critics closely
scrutinized the relationship between the two organizations.
A Washington Post editorial argued that the NPF should "be
subject to the usual laws on contributions and disclosures."
Who Paid for Those Ideas?, Wash. Post, Oct. 1, 1993, at A24.
According to the editorial, the watchdog group Common
Cause was "looking into" whether the NPF " 'violat[ed] ...
the campaign laws and whether it should be challenged.' "
Id. (quoting Common Cause's president).
Acting through the Justice Department's Campaign Fi-
nancing Task Force, the government alleges that in the
summer of 1994, the RNC Chairman arranged to have funds
transferred from a Hong Kong company through an Ameri-
can subsidiary to an American bank to serve as collateral for
a loan the bank made to the NPF. From the proceeds of the
loan, the NPF then paid the RNC $1.6 million. In connection
with this transaction, the RNC consulted a lawyer who,
according to the lawyer's affidavit, prepared, made notes on,
and edited documents "in anticipation of possible litigation."
In August 1995, the Democratic National Committee filed a
complaint with the Federal Election Commission alleging that
the RNC's relationship with the NPF violated the Federal
Election Campaign Act, 2 U.S.C. ss 431-455 (1994). Al-
though nothing in the record tells us what, if anything, the
FEC did with this complaint, two years later a federal grand
jury issued a subpoena directing the lawyer to produce
memoranda, correspondence, notes, and other written materi-
als relating to the 1994 loan transaction. Producing over 140
documents, some of which were redacted, the lawyer withheld
ninety-five pages, claiming they were protected by either the
attorney-client or the work-product privilege. After the gov-
ernment moved to compel, the RNC filed a motion to inter-
vene, which the district court granted.
In a Memorandum Opinion and Order issued on March 10,
1998--and sealed to protect the lawyer's identity, see In re
Motions of Dow Jones & Co., Nos. 98-3033 & 98-3034, 1998
WL 216042, at *8 (D.C.Cir. May 5, 1998) (noting that grand
jury secrecy rules protect the identity of grand jury wit-
nesses)--the district court ruled that the work-product privi-
lege protected none of the documents prepared by the lawyer
prior to the filing of the DNC's August 1995 complaint. The
district court found that neither the lawyer nor the RNC had
"articulate[d] any specific claim the RNC could have been
facing at the time of the loan transaction" or "explain[ed] with
any particularity how the loan transaction could have led to
litigation." In re Grand Jury No. 95-3, No. 98-003, at 7
(D.D.C. Mar. 10, 1998). For documents prepared after the
filing of the DNC complaint, the court ruled that the privilege
applied, but that since the government can obtain access to
factual information contained in even protected documents by
demonstrating substantial need and inability to obtain the
materials elsewhere, and finding that such a showing had
been made here, it would review the documents in camera to
determine whether they contain only factual information, or
instead represent opinions, judgments, and thought processes
of counsel. Id. at 8.
The RNC appealed, and we granted its motion to stay
pending appeal. Although parties ordinarily may not imme-
diately appeal discovery orders, but must instead disobey and
then appeal a subsequent contempt order, see In re Kessler,
100 F.3d 1015, 1016 (D.C. Cir. 1997), the RNC may proceed
under the Perlman doctrine, which authorizes parties imme-
diately to appeal discovery orders addressed to disinterested
third parties, see Perlman v. United States, 247 U.S. 7, 13-15
(1918). The Perlman doctrine applies here because the law-
yer swore in an affidavit an intention to produce the docu-
ments rather than submit to a contempt citation. See In re
Sealed Case, 1998 WL 146011, at *2 n.1 (D.C. Cir. Apr. 14,
1998) ("In some cases the attorney will indicate an intention
to comply with the subpoena, and on those facts this circuit
regards Perlman as controlling."). Because the Perlman
doctrine authorizes appeals only by clients, however, we
dismissed the lawyer's appeal. See id. ("Of course that
makes appeal available for the client, not, as here, the attor-
ney.").
We generally review district court decisions enforcing docu-
ment subpoenas only for arbitrariness or abuse of discretion.
See In re Sealed Case, 121 F.3d 729, 740 (D.C. Cir. 1997).
But because the RNC argues that the district court applied
the wrong legal standard, our review here is de novo. See In
re Subpoena Served upon the Comptroller of the Currency,
967 F.2d 630, 633 (D.C. Cir. 1992) (court gives no deference if
the ruling "rests upon a misapprehension of the relevant legal
standard or is unsupported by the record").
II
The work-product privilege protects written materials law-
yers prepare "in anticipation of litigation." Fed. R. Civ. P.
26(b)(3). By ensuring that lawyers can prepare for litigation
without fear that opponents may obtain their private notes,
memoranda, correspondence, and other written materials, the
privilege protects the adversary process. See In re Sealed
Case, 107 F.3d 46, 51 (D.C. Cir. 1997) ("Like the attorney-
client privilege, work product immunity promotes the render-
ing of effective legal services."). As the Supreme Court said
in Hickman v. Taylor, 329 U.S. 495 (1947), the source of the
work-product privilege:
[I]t is essential that a lawyer work with a certain degree
of privacy, free from unnecessary intrusion by opposing
parties and their counsel. Proper preparation of a
client's case demands that he assemble information, sift
what he considers to be the relevant from the irrelevant
facts, prepare his legal theories and plan his strategy
without undue and needless interference.
Id. at 510-11; see also 2 Christopher B. Mueller & Laird C.
Kirkpatrick, Federal Evidence 410 (2d ed. 1994) ("Protection
is needed because an attorney preparing for trial must assem-
ble much material that is outside the attorney-client privilege,
such as witness statements, investigative reports, drafts of
pleadings, and trial memoranda."). The interests articulated
in Hickman are present in both criminal and civil cases. See
United States v. Nobles, 422 U.S. 225, 238 (1975) ("Although
the work-product doctrine most frequently is asserted as a
bar to discovery in civil litigation, its role in assuring the
proper functioning of the criminal justice system is even more
vital. The interests of society and the accused in obtaining a
fair and accurate resolution of the question of guilt or inno-
cence demand that adequate safeguards assure the thorough
preparation and presentation of each side of the case.").
Without a strong work-product privilege, lawyers would keep
their thoughts to themselves, avoid communicating with other
lawyers, and hesitate to take notes. As Hickman put it:
Were such materials open to opposing counsel on mere
demand, much of what is now put down in writing would
remain unwritten. An attorney's thoughts, heretofore
inviolate, would not be his own. Inefficiency, unfairness
and sharp practices would inevitably develop in the giv-
ing of legal advice and in the preparation of cases for
trial. The effect on the legal profession would be demo-
ralizing. And the interests of the clients and the cause of
justice would be poorly served.
329 U.S. at 511; see also Restatement (Third) of the Law
Governing Lawyers s 136 cmt. b (Proposed Final Draft No. 1,
1996) ("Restatement") ("The work-product doctrine also pro-
tects client interests in obtaining diligent assistance from
lawyers. A lawyer whose work product would be open to the
other side might forgo useful preparatory procedures, for
example, note-taking.").
The "testing question" for the work-product privilege, we
have held, is " 'whether, in light of the nature of the document
and the factual situation in the particular case, the document
can fairly be said to have been prepared or obtained because
of the prospect of litigation.' " Senate of Puerto Rico v. U.S.
Dep't of Justice, 823 F.2d 574, 586 n.42 (D.C. Cir. 1987)
(quoting 8 Charles A. Wright & Arthur R. Miller, Federal
Practice and Procedure s 2024 at 198 (1970)). For a docu-
ment to meet this standard, the lawyer must at least have had
a subjective belief that litigation was a real possibility, and
that belief must have been objectively reasonable. See Mar-
tin v. Bally's Park Place Hotel & Casino, 983 F.2d 1252, 1260
(3d Cir. 1993) (noting that "anticipation of litigation" inquiry
is both subjective and objective); Restatement s 136, cmt. i
("[T]he immunity covers only material produced with litiga-
tion as the primary object of attention and when the appre-
hension of litigation was reasonable in the circumstances.").
The question presented in this case is whether a "specific
claim" must have arisen at the time the lawyer prepared the
documents before a court can conclude that they were in fact
prepared "because of the prospect of litigation." The RNC
argues that the work-product privilege turns not on the
presence or absence of a specific claim, but rather on wheth-
er, under "all of the relevant circumstances," the lawyer
prepared the materials in anticipation of litigation. Accord-
ing to the government, the " 'specific claim' analysis ... is
essential to delimit the boundary" between privileged and
nonprivileged materials.
At first glance, our cases on this issue appear inconsistent.
We required a specific claim in two cases, Coastal States Gas
Corp. v. Department of Energy, 617 F.2d 854, 864-66 (D.C.
Cir. 1980), and Safecard Servs. Inc. v. SEC, 926 F.2d 1197,
1202-03 (D.C. Cir. 1991). We rejected the need for a specific
claim in two other cases, Schiller v. NLRB, 964 F.2d 1205,
1208 (D.C. Cir. 1992), and Delaney, Migdail & Young, Char-
tered v. IRS, 826 F.2d 124, 126-28 (D.C. Cir. 1987). Properly
read, however, these cases are not in conflict.
In the two cases requiring a specific claim--Coastal States
and Safecard--the documents at issue had been prepared by
government lawyers in connection with active investigations
of potential wrongdoing. The documents in Coastal States
were legal advice memoranda prepared by government law-
yers in response to specific requests from agency auditors
examining oil company compliance with certain regulations.
We employed a specific claim requirement to distinguish
memoranda that could be protected by the work-product
privilege because they advised DOE auditors how to proceed
with specific investigations of suspected wrongdoers--i.e., the
lawyers prepared them "in anticipation of litigation"--from
other documents that were "neutral, objective analyses of
agency regulations" and therefore unprotected by the privi-
lege. Delaney, 826 F.2d at 127 (quoting Coastal States, 617
F.2d at 863). Safecard dealt with documents prepared by
agency lawyers in connection with an active investigation into
suspected illegal stock trading. We held there that when
government lawyers "prepare[ ] a document in the course of
an active investigation focusing upon specific events and a
specific possible violation by a specific party," they have met
the specific claim test. 926 F.2d at 1203.
Delaney and Schiller dealt with very different situations.
In those cases, government lawyers acted not as prosecutors
or investigators of suspected wrongdoers, but as legal advis-
ors protecting their agency clients from the possibility of
future litigation. Both cases rejected the specific claim re-
quirement and instead focused on whether, under all of the
circumstances, the lawyers prepared the materials "in antici-
pation of litigation." At issue in Delaney were memoranda
prepared by agency attorneys that analyzed the legal ramifi-
cations of a new system of statistical sampling for auditing
large accounts. Observing that the memoranda "advise the
agency of the types of legal challenges likely to be mounted
against a proposed program, potential defenses available to
the agency, and the likely outcome," we characterized Coastal
States' "specific claim" language as an "observation," conclud-
ed that Coastal States "did not intend to lay down [a] blanket
rule," and held that the work-product privilege protected the
documents even though no specific claim had yet arisen. 826
F.2d at 127. Schiller concerned lawyer-prepared documents
containing tips and advice for litigating cases under the Equal
Access to Justice Act. Responding to an argument that "the
work-product doctrine requires that the documents be creat-
ed in anticipation of litigation over a specific claim," we said,
"we have already rejected that argument." 964 F.2d at 1208.
Schiller protected the documents even though no specific
claim had arisen.
We need not decide whether the Coastal States/Safecard
specific claim test has any continued vitality where govern-
ment lawyers act as prosecutors or investigators of suspected
wrongdoers. Here, as in Delaney and Schiller, the lawyer
acted not as prosecutor or investigator, but rendered legal
advice in order to protect the client from future litigation
about a particular transaction, even though at the time,
neither the FEC nor the DNC had made any specific claim.
In addition to asserting more than once that the documents
were prepared "in anticipation of litigation," the lawyer's
uncontested affidavit states that by the summer of 1994, "I
was aware that the Federal Election Commission ('FEC') had
the authority to conduct investigations and initiate civil ac-
tions ... concerning possible violations of the Federal Elec-
tion Campaign Act" and that "I was also aware that the
chairman of the FEC had announced that the FEC was
investigating cases involving allegations of illegal contribu-
tions in U.S. elections." Most important, the affidavit says
that "I was further aware that the NPF had been criticized in
the press as an organization used by the RNC to evade
federal campaign finance laws, and thus I had a significant
concern that litigation over this issue was probable." Anoth-
er RNC lawyer said, also in an uncontested affidavit, that
"[F]rom the time the NPF was formed, I and the RNC were
concerned about the substantial likelihood of potential litiga-
tion initiated either by the DNC or other entities. Therefore,
the RNC consulted with [the lawyer] to receive advice, coun-
sel, and services in anticipation of such litigation."
Assuming that these affidavits accurately describe the law-
yer's materials at issue in this case, denying work-product
protection to the materials would be no more appropriate
than denying protection to the documents at issue in Delaney
and Schiller. To be sure, the lawyers' affidavits could have
been more specific, e.g., they could have stated that the
lawyers believed that the FEC would bring a FECA action
based on the loan transaction or cited particular provisions of
the code. But we think the affidavits sufficiently establish
that, as in Delaney and Schiller, the client asked the lawyer
to review a matter that the client feared could lead to
litigation, and that the lawyer, knowing critics were scrutiniz-
ing the RNC-NPF relationship, prepared documents in antic-
ipation of litigation over exactly that relationship. In view of
the intense focus in this city on claims of campaign finance
law violations, as well as the public criticism of the RNC-
NPF relationship, the lawyer's concern that the payment
from one organization to the other from proceeds of a loan
backed by a transfer of funds from a Hong Kong company
might lead to litigation seems as objectively reasonable to us
as the concerns of the government lawyers in Delaney and
Schiller.
Not only do Delaney and Schiller, not Coastal States and
Safecard, control this case, but a contrary ruling would
undermine lawyer effectiveness at a particularly critical stage
of a legal representation. It is often prior to the emergence
of specific claims that lawyers are best equipped either to
help clients avoid litigation or to strengthen available defens-
es should litigation occur. For instance, lawyers routinely
meet with potential grand jury targets to discuss possible
charges, consider whether business decisions might result in
antitrust or securities lawsuits, analyze copyright and patent
implications of new technologies or works of art, and assess
the possibility that new products might give rise to tort
actions. If lawyers had to wait for specific claims to arise
before their writings could enjoy work-product protection,
they would not likely risk taking notes about such matters or
communicating in writing with colleagues, thus severely limit-
ing their ability to advise clients effectively. A lawyer advis-
ing a potential grand jury target, for example, might be
reluctant to write something like "the critical facts which
could harm my client are ..." even though it would help the
lawyer organize complex thoughts, because in the govern-
ment's hands, such a note could become a powerful weapon
against the client. Likewise, asked by a client to evaluate the
antitrust implications of a proposed merger and advised that
no specific claim had yet surfaced, a lawyer knowing that
work product is unprotected would not likely risk preparing
an internal legal memorandum assessing the merger's weak-
nesses, jotting down on a yellow legal pad possible areas of
vulnerability, or sending a note to a partner--"After review-
ing the proposed merger, I think it's O.K., although I'm a
little worried about ... What are your views?" Nor would
the partner respond in writing, "I disagree. This merger is
vulnerable because ..." Discouraging lawyers from engag-
ing in the writing, note-taking, and communications so critical
to effective legal thinking would, in Hickman's words, not
only "demoraliz[e]" the legal profession, but also "the inter-
ests of the clients and the cause of justice would be poorly
served." 329 U.S. at 511.
The government relies on Linde Thomson Langworthy
Kohn & Van Dyke, P.C. v. RTC, 5 F.3d 1508 (D.C. Cir. 1993),
our most recent case bearing on this issue, but nothing in that
decision requires a specific claim before lawyers preparing for
the possibility of litigation can claim work-product protection.
Although Linde Thomson quotes the "specific claim" lan-
guage from Coastal States, id. at 1515, we did not apply the
"specific claim" standard to reject protection for any request-
ed document. Instead, Linde Thomson held that communica-
tions between insurer and insured do not "warrant an exten-
sion of the federal work-product doctrine beyond its current
confines," id. at 1516, and that the district court had acted
appropriately by allowing the appellant to establish a privi-
lege log for documents arguably protected by the privilege,
id.
Of course, not all work undertaken by lawyers finds protec-
tion in the work-product privilege. In some cases, the ab-
sence of a specific claim will suggest that the lawyer had not
prepared the materials "in anticipation of litigation." And as
Linde Thomson explained, the privilege has no applicability
to documents prepared by lawyers "in the ordinary course of
business or for other nonlitigation purposes." Id. at 1515.
We hold only that where, as here, lawyers claim they advised
clients regarding the risks of potential litigation, the absence
of a specific claim represents just one factor that courts
should consider in determining whether the work-product
privilege applies.
We would expect the government to support this result.
For one thing, requiring a specific claim would subject to
discovery a great deal of pre-claim work by agency lawyers
that the work-product privilege now protects. If the govern-
ment's position were to prevail in this case, materials similar
to the documents at issue in Delaney and Schiller would no
longer enjoy work-product protection. Moreover, lacking
resources to pursue every suspected violation of federal law,
the government must depend on effective, conscientious pri-
vate lawyers to help clients comply voluntarily. The govern-
ment might gain some short-term benefit by obtaining the
documents in this case, but the long-range consequences
could be quite damaging. Weakening lawyer ability to repre-
sent clients at the pre-claim stage of anticipated litigation
would inevitably reduce voluntary compliance with the law,
produce more litigation, and increase the workload of govern-
ment law-enforcement agencies.
III
This brings us to the district court's decision and its
reasons for finding that the pre-August 1995 documents are
unprotected by the work-product privilege. According to the
government, the district court employed the "specific claim"
test as only one factor in its analysis. We disagree. Al-
though Delaney and Schiller clearly control this case, the
district court, relying primarily on Coastal States, treated the
absence of a specific claim as dispositive.
The district court's memorandum begins by properly noting
several times that the privilege protects materials prepared
"in anticipation of litigation." In re Grand Jury No. 95-3,
No. 98-003, at 6. Quoting Coastal States, the memorandum
goes on to say that to meet this standard " 'the documents
must at least have been prepared with a specific claim
supported by concrete facts which would likely lead to litiga-
tion in mind,' " id. (quoting Safecard, 926 F.2d at 1202
(quoting Coastal States, 617 F.2d at 865)), and that "[t]here
must be 'at the very least some articulable claim, likely to
lead to litigation,' " id. (quoting Coastal States, 617 F.2d at
865). The district court then directly applied this standard to
the facts, concluding that the lawyer's "and the RNC's asser-
tions regarding potential litigation are too vague to support
application of the work product doctrine before August 1995."
Id. at 7. Recognizing that according to the affidavit, the
lawyer knew that the FEC investigated allegations of illegal
contributions and that the NPF had been criticized in the
press as an organization used by the RNC to evade federal
campaign finance laws, the court nevertheless found that the
work-product privilege did not apply, saying only this:
Despite these averments, [the lawyer] and the RNC have
not presented any concrete facts to the Court "which
would likely lead to litigation" prior to August of 1995.
They do not articulate any specific claim the RNC could
have been facing at the time of the loan transaction nor
do they explain with any particularity how the loan
transaction could have led to litigation.
Id. As these two sentences demonstrate, the district court
based its decision on three findings: that the lawyer (1) failed
to present "concrete facts" "which would likely lead to litiga-
tion"; (2) failed to articulate a "specific claim"; and (3) failed
to explain with any particularity how the transaction could
have led to litigation. Although only the second of these
findings mentions the phrase "specific claim," the first comes
directly from the "specific claim" sentence in Coastal States
that the district court quoted in its paragraph setting out the
legal standard. See Coastal States, 617 F.2d at 865 ("[T]he
documents must at least have been prepared with a specific
claim supported by concrete facts which would likely lead to
litigation.") (emphasis added). And the third finding, while
substituting the word "particularity" for the word "concrete,"
the words "loan transaction" for the word "facts," and the
phrase "could have led to litigation" for "would likely lead to
litigation," merely restates the first finding and therefore is
also directly traceable to the "specific claim" standard. When
read in light of the legal standard articulated by the district
court only two paragraphs earlier, this language indicates to
us that the court rejected work-product protection because no
"specific claim" had yet arisen. We think this interpretation
finds further support in the district court's extension of the
privilege to all post-complaint documents, thus suggesting
that the district court focused on the filing of the complaint,
not on whether the lawyer prepared the documents in antici-
pation of litigation, as the critical difference between protect-
ed and unprotected materials.
At oral argument, the government suggested that because
nothing in the August 1995 complaint related directly to the
loan transaction, the privilege should not protect the pre-
complaint documents. Taking the government's characteriza-
tion of the complaint as true--the record does not contain the
complaint--we think this casts even further doubt on the
district court's decision. If the complaint is unconnected to
the transaction, why did the district court conclude that the
post-August 1995 documents were protected by the privilege?
In any event, the contents of the August 1995 complaint have
little if any relevance to the issue before us. The work-
product privilege protects documents prepared in anticipation
of litigation regardless of whether the anticipated litigation
ever occurs. Restatement s 136 cmt. i ("The fact that
litigation did not actually ensue does not affect the immuni-
ty.").
IV
Acknowledging the lack of clarity in our own decisions, but
finding that the district court applied the wrong legal stan-
dard, we reverse and remand for the court to review the
documents in camera to determine whether, under all the
circumstances, the lawyer prepared them "in anticipation of
litigation," or whether they were prepared in the ordinary
course of business (e.g., to deal with issues such as interest
rates, payment schedules, or collateral). See In re Sealed
Case, 29 F.3d 715, 718 (D.C. Cir. 1994) (remanding case to
district court for application of the "because of the prospect of
litigation" test). With respect to documents the court finds to
have been prepared "in anticipation of litigation," the court
should examine them (as it announced it will with respect to
the post-August 1995 documents) to determine whether they
contain purely factual materials, or instead represent the
opinions, judgments, and thought processes of counsel.
So ordered.