Solis v. Food Employers Labor Relations Ass'n

PUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

HILDA L. SOLIS, Secretary of 

Labor, United States Department

of Labor,

Petitioner-Appellee,

v.

THE FOOD EMPLOYERS LABOR

RELATIONS ASSOCIATION AND UNITED  No. 10-1687

FOOD AND COMMERCIAL WORKERS

PENSION FUND; THE FOOD

EMPLOYERS LABOR RELATIONS

ASSOCIATION AND UNITED FOOD AND

COMMERCIAL WORKERS HEALTH AND

WELFARE FUND,

Respondents-Appellants.



Appeal from the United States District Court

for the District of Maryland, at Baltimore.

J. Frederick Motz, Senior District Judge.

(1:10-cv-00629-JFM)

Argued: March 22, 2011

Decided: May 4, 2011

Before NIEMEYER and DAVIS, Circuit Judges,

and Ronald Lee GILMAN, Senior Circuit Judge of the

United States Court of Appeals for the Sixth Circuit,

sitting by designation.

2 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

Affirmed by published opinion. Judge Davis wrote the opin-

ion, in which Judge Niemeyer and Senior Judge Gilman con-

curred.

COUNSEL

ARGUED: Barry Steven Slevin, SLEVIN & HART, PC,

Washington, D.C., for Appellants. Ashton Schoonover Phil-

lips, UNITED STATES DEPARTMENT OF LABOR, Wash-

ington, D.C., for Appellee. ON BRIEF: Sharon M.

Goodman, Sarah E. Sanchez, SLEVIN & HART, PC, Wash-

ington, D.C., for Appellants. M. Patricia Smith, Solicitor of

Labor, Timothy D. Hauser, Associate Solicitor for Plan Bene-

fits Security, Elizabeth Hopkins, Counsel for Appellate and

Special Litigation, UNITED STATES DEPARTMENT OF

LABOR, Washington, D.C., for Appellee.

OPINION

DAVIS, Circuit Judge:

This appeal arises out of the district court’s grant of a peti-

tion by the Secretary of the United States Department of

Labor ("DOL") to enforce administrative document subpoe-

nas. The Secretary served the subpoenas on two multiem-

ployer employee benefit plans, the Food Employers Labor

Relations Association and United Food and Commercial

Workers Pension Fund ("Pension Fund") and the Food

Employers Labor Relations Association and United Food and

Commercial Workers Health and Welfare Fund ("Health

Fund") (collectively the "Funds"), as part of an investigation

undertaken pursuant to § 504(a)(1) of the Employee Retire-

ment Income Security Act of 1974 ("ERISA"), 29 U.S.C.

§ 1134(a)(1), into possible mismanagement of fund assets.

Claiming attorney-client and work product privileges, the

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 3

Funds objected to the production of some responsive docu-

ments. After the Secretary sought judicial enforcement of the

subpoenas, the district court ordered the Funds to produce the

withheld documents, applying the fiduciary exception to the

claimed privileges. The Funds timely appealed. Finding no

error in the district court’s order enforcing the subpoenas, we

affirm.

I.

The DOL investigation into the management of the Funds

arises out of a $10.1 million loss of ERISA plan assets as a

result of the Funds’ investments in entities related to Bernard

L. Madoff, who has since been convicted of securities fraud

for organizing a multi-billion dollar Ponzi scheme.1

Specifically, the Funds indirectly invested in Bernard L.

Madoff Investment Securities, LLC ("BMIS"), Madoff’s

investment firm. According to affidavits provided by the

Funds, the Board of Trustees for the Pension Fund inter-

viewed a number of investment hedge fund of funds2 in May

2004. The Board discussed the options with the Fund’s invest-

ment consultants and decided to accept the consultants’ rec-

ommendation to invest approximately three percent of the

Fund’s assets in the Meridian Diversified ERISA Fund Ltd.

("Meridian Fund"). The Meridian Fund’s investment manager

in turn invested a portion of those assets in the Rye Broad

Market XL Portfolio Limited Fund. The investment advisors

for the Rye Broad Market Fund hired BMIS to manage a por-

tion of the Rye Broad Market Fund’s assets. As of December

31, 2008, of the Pension Fund’s $675 million in assets,

approximately $41 million, or 6%, was invested in the Merid-

1

See Judgment (Doc. #100), United States v. Madoff, Action No. 1:09-

CR-0213-DC (S.D.N.Y. June 16, 2009). Madoff was the founder of Ber-

nard L. Madoff Investment Securities, LLC.

2

A hedge fund of funds is an investment vehicle with shares in multiple

hedge funds, usually in order to diversify risk.

4 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

ian Fund, of which approximately $2.5 million, or 0.4% of the

Pension Fund’s total assets, was invested in the Rye Broad

Market Fund.

In a similar fashion, in May 2005, the Board of Trustees of

the Health Fund, based on the recommendation of its invest-

ment consultant, invested $29 million in the Meridian Fund.

As with the assets of the Pension Fund, the Meridian Fund

invested a portion of the Health Fund’s assets in the Rye

Broad Market Fund, of which BMIS managed a portion. As

of December 31, 2008, of the Health Fund’s $97.5 million in

assets, $7.6 million, or 7.8%, was invested in the Meridian

Fund, of which $500,000, or 0.5% of the Health Fund’s total

assets, was invested in the Rye Broad Market Fund. As a

result of losses associated with these Madoff-related invest-

ments, the Funds are members of a plaintiff-class in a suit

against Meridian.

DOL’s Employee Benefit Security Administration

("EBSA") conducts audits pursuant to § 504(a)(1) of ERISA,

which authorizes DOL to investigate whether a violation of

Title I of ERISA or regulations or orders issued thereunder

has occurred or is about to occur. 29 U.S.C. § 1134(a)(1). On

April 15, 2009, DOL issued two subpoenas duces tecum

requesting documents relating to the administration of the

Funds. The request covered a range of the Funds’ activities,

but focused on information concerning the decision to commit

assets to Madoff-related investments.

On April 16, 2009, the Funds provided documents partially

responsive to the subpoenas, but redacted portions of some

documents and wholly withheld some others, claiming they

were protected by attorney-client and work product privileges.

DOL and the Funds negotiated over the next few months

regarding the scope of the subpoenas. In response to the

Funds’ concerns, DOL agreed to limit the time period covered

by the request and to narrow the scope of 29 of the 38 sub-

poena specifications. Throughout these discussions, EBSA

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 5

maintained that the Funds were not permitted to withhold

documents based on attorney-client or work product privi-

leges. The negotiations eventually broke down, however, and,

on March 10, 2010, the Secretary filed a petition in federal

district court to obtain compliance with the subpoenas.

Following briefing and a hearing, the district court granted

the Secretary’s petition on May 19, 2010. In reaching its deci-

sion, the district court applied the fiduciary exception to the

privileges asserted by the Funds. The district court ordered the

Funds to comply with the subpoenas and produce documents

dealing with: (1) Board of Trustees and Policy Committee

meeting minutes for the Funds; (2) documents referred to or

distributed during these meetings; (3) notes taken at these

meetings; (4) any correspondence relating to the Funds’

Madoff-related investments; and (5) documents outside the

four categories listed above that the Funds withheld based on

privilege claims. In accordance with the Secretary’s offer to

exempt certain categories from production, the district court

excluded the production of documents dealing exclusively

with benefits disputes, benefits claims, subrogation agree-

ments, delinquent contributions, withdrawal liability, or col-

lection actions involving employers. The district court’s order

also excluded information covered by the attorney-client priv-

ilege or work product protection in documents dated after ser-

vice of the subpoenas or prepared in connection with the

current investigation.

Notably, the district court addressed the Funds’ concerns

about the ability of third parties to access the information dis-

closed in response to the subpoenas, finding that "compliance

with [the] Order does not waive any attorney-client or work

product privilege with respect to any third party" and ordering

DOL to notify the Funds of any requests received under the

Freedom of Information Act, 5 U.S.C. § 552, for documents

produced under the order. J.A. 85. The Funds produced the

documents required by the district court’s order and filed a

6 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

timely notice of appeal. The Funds seek reversal of the district

court’s order and the return of the privileged documents.3

II.

Recognizing that Congress delegated enforcement mecha-

nisms to agency discretion, this court has emphasized that the

district court’s role in a proceeding to enforce an administra-

tive subpoena is "sharply limited." EEOC v. City of Norfolk

Police Dept., 45 F.3d 80, 82 (4th Cir. 1995) (internal quota-

tion marks omitted); see also EEOC v. Am. & Efird Mills,

Inc., 964 F.2d 300, 303 (4th Cir. 1992). To enforce an admin-

istrative subpoena, the district court need only find that (1) the

agency is authorized to make such an investigation; (2) the

agency has complied with statutory requirements of due pro-

cess; and (3) the materials requested are relevant. See, e.g.,

United States v. Am. Target Adver., Inc., 257 F.3d 348, 351

(4th Cir. 2001); Am. & Efird Mills, 964 F.2d at 302-03. If the

agency can make such a showing, "the court must enforce the

subpoena unless the party being investigated demonstrates

that the subpoena is unduly burdensome." EEOC v. Maryland

Cup Corp., 785 F.2d 471, 475-76 (4th Cir. 1986) (citing FTC

v. Texaco, Inc., 555 F.2d 862, 882 (D.C. Cir. 1977) (en

banc)). This court reviews the factual findings underlying a

district court’s enforcement of an agency subpoena for clear

error. EEOC v. Lockheed Martin Corp., Aero & Naval Sys-

tems, 116 F.3d 110, 113 (4th Cir. 1997). We review questions

3

We note that the Funds’ production of the documents in compliance

with an administrative subpoena does not affect our jurisdiction over this

appeal. See Church of Scientology of California v. United States, 506 U.S.

9, 15 (1992) (holding appeal that followed compliance with district court

order enforcing IRS summons not moot because "if the summons were

improperly issued or enforced a court could order that the IRS’ copies of

the tapes be either returned or destroyed"); Reich v. National Eng’g &

Contracting Co., 13 F.3d 93, 97-98 (4th Cir. 1993) (finding companies’

continuing privacy interest in documents produced in compliance with dis-

trict court order enforcing agency subpoenas ensured a live controversy on

appeal from the order).

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 7

of law de novo. See Maryland Cup Corp., 785 F.2d at 475-76

(internal citations omitted).

On appeal, the Funds do not challenge the Secretary’s

authority to issue the subpoenas; nor do they raise due process

or relevance concerns. Instead, they argue that the attorney-

client and work product privileges protect some of the materi-

als requested by the Secretary from disclosure and that the

district court erred in applying the fiduciary exception to

override these privileges. This court reviews de novo a district

court’s decision regarding the scope and applicability of an

asserted privilege "to the extent the court’s holding rests on

application of controlling legal principles to the facts." In re

Allen, 106 F.3d 582, 601 (4th Cir. 1997); see also In re Grand

Jury Subpoena, 341 F.3d 331, 334 (4th Cir. 2003). We

address in turn the Funds’ claims of attorney-client and work

product privilege.

A.

Intended to encourage "full and frank communication

between attorneys and their clients," the attorney-client privi-

lege is "the oldest of the privileges for confidential communi-

cations known to the common law." Upjohn Co. v. United

States, 449 U.S. 383, 389 (1981). Nonetheless, the privilege

is not absolute, and this court has noted that it "is to be strictly

confined within the narrowest possible limits consistent with

the logic of its principle." United States v. Aramony, 88 F.3d

1369, 1389 (4th Cir. 1996) (internal citations and quotation

marks omitted).

Courts have recognized one such limit in the context of

fiduciary relationships. Rooted in the common law of trusts,

the fiduciary exception is based on the rationale that the bene-

fit of any legal advice obtained by a trustee regarding matters

of trust administration runs to the beneficiaries. Consequently,

"trustees . . . cannot subordinate the fiduciary obligations

owed to the beneficiaries to their own private interests under

8 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

the guise of attorney-client privilege." Riggs Nat. Bank of

Washington, D.C. v. Zimmer, 355 A.2d 709, 714 (Del. Ch.

1976).

This principle has been applied to fiduciary relationships

beyond the traditional trust context. See, e.g., Garner v. Wol-

finbarger, 430 F.2d 1093, 1103-04 (5th Cir. 1970) (balancing

potential costs and benefits of disclosure to hold that, in

shareholder derivative action against corporate officers,

"availability of the privilege be subject to the right of the

stockholders to show cause why it should not be invoked in

the particular instance"). Several of our sister circuits, more-

over, have recognized the exception to assertions of attorney-

client privilege by ERISA fiduciaries. See, e.g., Bland v. Fia-

tallis N. Am. Inc., 401 F.3d 779, 787-88 (7th Cir. 2005) (rec-

ognizing fiduciary exception but finding it did not apply to

communications relating to non-fiduciary actions, including

amendments to plan benefits); United States v. Mett, 178 F.3d

1058, 1062 (9th Cir. 1999) (finding fiduciary exception

applied in ERISA context, but did not extend to "any advice

that a fiduciary obtains in an effort to protect herself from

civil or criminal liability"); United States v. Doe, 162 F.3d

554, 557 (9th Cir. 1999) (applying fiduciary exception to

claims of privilege in context of ERISA enforcement action);

Becher v. Long Island Lighting Co., 129 F.3d 268, 272 (2d

Cir. 1997) (recognizing fiduciary exception to attorney-client

privilege in ERISA context was limited to fiduciary matters);

Wildbur v. ARCO Chem. Co., 974 F.2d 631, 645 (5th Cir.

1992) (recognizing fiduciary exception but finding it did not

apply to communications that were "made for the purpose of

defending the pending lawsuit and did not deal with plan

administration"). Cf. Wachtel v. Health Net, Inc., 482 F.3d

225, 234 (3d Cir. 2007) (describing evolution of fiduciary

exception in ERISA context and finding exception did not

reach communications of ERISA plan insurer with plan attor-

neys regarding benefit claims).

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 9

Analogizing the ERISA fiduciary’s role to the role of the

trustee at common law,4 these courts have relied on one of

two related rationales. Applying the reasoning of the Fifth

Circuit in Garner, some courts have concluded that the

ERISA fiduciary’s duty to act in the exclusive interest of ben-

eficiaries supersedes the fiduciary’s right to assert attorney-

client privilege. See, e.g., Bland, 401 F.3d at 787; Becher, 129

F.3d at 271-72. Other courts, however, have reasoned that the

ERISA fiduciary, as a representative of the beneficiaries, is

not the real client in obtaining advice regarding plan adminis-

tration and "thus never enjoyed the privilege in the first

place." Mett, 178 F.3d at 1063 (internal citations omitted). See

Doe, 162 F.3d at 556; Wildbur, 974 F.2d at 645; Washington-

Baltimore Newspaper Guild, Local 35 v. Washington Star

Co., 543 F. Supp. 906, 909 (D.D.C. 1982). Under either ratio-

nale, "where an ERISA trustee seeks an attorney’s advice on

a matter of plan administration and where the advice clearly

does not implicate the trustee in any personal capacity, the

trustee cannot invoke the attorney-client privilege against the

plan beneficiaries." Mett, 178 F.3d at 1064.

This court has not previously examined the fiduciary

exception in the context of ERISA, though several district

courts in this circuit have addressed the issue.5 See, e.g.,

4

Reading ERISA in light of common law trust principles comports with

the Supreme Court’s guidance on interpreting ERISA. See Firestone Tire

& Rubber Co. v. Bruch, 489 U.S. 101, 110 (1989) (analyzing trust law to

determine the appropriate standard under which to review an ERISA fidu-

ciary’s denial of benefits).

5

We recognized the fiduciary exception in the context of a corporate

shareholder derivative action in Sandberg v. Virginia Bankshares, Inc., in

which we adopted the Fifth Circuit’s holding and rationale from Garner,

and found that it "provide[d] a sound basis for balancing a corporation’s

need to communicate confidentially with its attorneys against the share-

holders’ interests as beneficiaries of a fiduciary relationship." 979 F.2d

332, 352 (4th Cir. 1992). However, the Sandberg opinion was vacated

pursuant to a joint agreement by the parties in that case. 1993 WL 524680

(4th Cir. Apr. 7, 1993).

10 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

Tatum v. R.J. Reynolds Tobacco Co., 247 F.R.D. 488, 495

(M.D.N.C. 2008) (recognizing "the existence of a fiduciary

exception where an ERISA plan administrator asserts

attorney-client privilege to withhold from plan beneficiaries

communications related to matters on which a fiduciary duty

is owed to the beneficiaries"); Coffman v. Metro. Life Ins. Co.,

204 F.R.D. 296, 299 (S.D.W. Va. 2001) (finding that fidu-

ciary exception required disclosure of documents dealing with

plan administration to ERISA trust beneficiaries). Persuaded

by the reasoning set forth in the opinions of our sister circuits

and the lower courts within our circuit, we find that the fidu-

ciary exception to attorney-client privilege extends to commu-

nications between an ERISA trustee and a plan attorney

regarding plan administration.

In now recognizing the fiduciary exception, we acknowl-

edge that it is not without limits. The exception will not apply,

for example, to a fiduciary’s communications with an attorney

regarding her personal defense in an action for breach of fidu-

ciary duty. See Mett, 178 F.3d at 1064. Similarly, communica-

tions between ERISA fiduciaries and plan attorneys regarding

non-fiduciary matters, such as adopting, amending, or termi-

nating an ERISA plan, are not subject to the fiduciary excep-

tion. See Bland, 401 F.3d at 787-88.

In the context of the shareholder derivative action, the fidu-

ciary exception also has been limited by a requirement that

one seeking to overcome a privilege show good cause. See

Garner, 430 F.2d at 1101, n.17, 1103-04 (rejecting unquali-

fied fiduciary exception out of concern, in part, that corpora-

tions may be "vulnerable to suit by shareholders whose

interests or intention may be inconsistent with those of other

shareholders"). In the context of the Secretary’s investigative

or enforcement activity under ERISA, however, the concerns

that inspired the good cause requirement in the corporate con-

text do not obtain, as "there exists no legitimate need for a

trustee to shield his actions from those whom he is obligated

to serve." Washington Star, 543 F. Supp. at 909, n.5; see also

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 11

In re Occidental Petrol. Corp., 217 F.3d 293, 298 (5th Cir.

2000) (noting that the Garner court’s concern regarding

potential for conflicting interests in corporate context was

"not triggered" where "plaintiffs seek discovery only to

uphold Occidental’s fiduciary duties to the [Employee Stock

Ownership Plan]" of which plaintiffs are beneficiaries). Cf.

Martin v. Valley Nat’l Bank, 140 F.R.D. 291, 326 (S.D.N.Y.

1991) (noting that "common-law principles governing

required disclosure of trustee communications do not impose

a ‘good cause’ limitation on the beneficiary’s access to this

type of information, and neither Garner nor its progeny offer

the slightest suggestion as to why that long-settled principle

ought now to be set aside"). Several other courts that have

addressed the scope of the fiduciary exception in the ERISA

context have also refused to apply a good cause requirement.

See Mett, 178 F.3d at 1063 (applying fiduciary exception

without reference to good cause requirement); Wildbur, 974

F.2d at 645 (same); Becher, 129 F.3d at 272 (same); Tatum,

247 F.R.D. at 495 (expressly rejecting Garner’s good cause

analysis); Henry v. Champlain Enters., Inc., 212 F.R.D. 73,

83-86 (N.D.N.Y. 2003) (applying good cause requirement to

plaintiffs’ shareholder derivative claim but not to their ERISA

claims); Hudson v. Gen. Dynamics Corp., 186 F.R.D. 271,

274 (D. Conn. 1999) (finding good cause not required in

ERISA context); Washington Star, 543 F. Supp. at 909 n.5

(same).6 Indeed, to our knowledge, only one thirty-year-old

6

The Funds’ attempt to portray the good cause showing as governed by

our decision in Sandberg is misplaced. Even apart from the fact that we

vacated our Sandberg opinion, Sandberg arose in the context of a corpo-

rate shareholder derivative action. 979 F.2d at 352. As discussed supra,

the application of the fiduciary exception in the ERISA context presents

different concerns from those involved in the corporate context, and courts

have continued to impose a good cause showing on the latter but not the

former. Nor does our decision in Faircloth v. Lundy Packing Co., 91 F.3d

648 (4th Cir. 1996), support the imposition of a good cause requirement

here. Faircloth dealt with provisions in ERISA that require certain auto-

matic disclosures, and made no mention of the fiduciary exception what-

soever. Id. at 655. Accordingly, it has little bearing on our determination

of the scope of that exception.

12 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

district court opinion has applied the good cause requirement

to limit the fiduciary exception in the ERISA context. See

Donovan v. Fitzsimmons, 90 F.R.D. 583, 586-87 (N.D. Ill.

1981). We do not find that case persuasive.

Even courts that have refused to impose a good cause

requirement, however, have maintained the limits imposed by

the fiduciary relationship itself. In particular, non-fiduciary

communications and a trustee’s personal legal advice will not

be subject to the exception. Thus, the application of the fidu-

ciary exception to any particular communication remains a

matter of "context and content." Mett, 178 F.3d at 1064;

Tatum, 247 F.R.D. 495.

In sum, we conclude that application of the fiduciary

exception to the attorney-client privilege in the context of a

subpoena issued by the Secretary of Labor under ERISA does

not require a showing of good cause; instead, its application

turns on the context and content of the individual communica-

tions at issue.

Turning to the case before us, the Funds argue that the dis-

trict court erred in applying the fiduciary exception to their

claim of attorney-client privilege in the context of the Secre-

tary’s investigation. Courts have held, and the parties agree,

that the fiduciary exception extends to the Secretary acting on

behalf of beneficiaries in the context of an ERISA enforce-

ment action. See Doe, 162 F.3d at 557 (recognizing that the

government may invoke the exception "when it is seeking to

vindicate the rights of ERISA beneficiaries"); Mett, 178 F.3d

at 1064 n.9; Valley Nat. Bank, 140 F.R.D. at 325-26 (noting

that "any communications by the Bank with the firm seeking

advice as to the administration of the Trust should be disclos-

able to the Secretary, who is suing on behalf of the beneficia-

ries of the Trust"); Fitzsimmons, 90 F.R.D. at 586-87 (finding

that "at this point, both DOL and the plan’s participants have

exactly the same interest, securing complete disclosure in

order to ferret out and discover any past wrongdoing affecting

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 13

the Fund"); Wsol v. Fiduciary Mgmt. Assoc., Inc., 1999 WL

1129100 (N.D. Ill. Dec. 7, 1999). Thus, although the Funds

concede that the fiduciary exception may apply to lawsuits

filed by DOL under § 502 of ERISA, they argue that it should

not extend to a DOL compliance investigation under § 504 of

ERISA.7 We disagree.

Attempting to distinguish the Secretary’s role under the two

provisions, the Funds argue that, under § 504, the Secretary

"acts as a regulator and not as a statutory designee seeking

recovery on behalf of the Funds’ participants." Appellant’s

Br. 20. The Funds note that the two actions "differ fundamen-

tally in terms of evidentiary support, scope, and the availabil-

ity of procedural safeguards." Id. at 22. Further, the Funds

contend that, in a compliance audit, the Secretary’s interests

may not align with those of the plan’s beneficiaries, speculat-

ing that a potential for greater risk of public disclosure of dis-

closed documents could harm beneficiary interests. The

district court rejected these arguments, however, finding that

the fiduciary exception applied in both contexts because "the

timing of the proceeding [does not make] any difference."

J.A. 81-82.

We can discern no principled basis on which to distinguish

between enforcement actions and investigations in the appli-

cation of the fiduciary exception; accordingly, we will not dis-

turb the judgment of the district court.

7

Section 504 authorizes the Secretary, "in order to determine whether

any person has violated or is about to violate any provision of this sub-

chapter or any regulation or order thereunder (1) to make an investigation,

and in connection therewith to require the submission of reports, books,

and records . . . ." 29 U.S.C. § 1134(a). Sec. 502 authorizes the Secretary

to bring a civil action in order "(A) to enjoin any act or practice which vio-

lates any provision of this subchapter, or (B) to obtain other appropriate

equitable relief. . . ." 29 U.S.C. § 1132(a)(5). At oral argument, counsel for

the Funds conceded that the fiduciary exception would apply if the Secre-

tary’s request had come in the context of a § 502 enforcement action.

14 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

The Secretary’s investigative role under § 504 is directly

related to her enforcement powers under § 502. The Secretary

correctly points out that, as a practical matter, effective

enforcement actions under § 502 will very often depend on

thorough investigations and audits under § 504. Furthermore,

it is unclear how the interests the Secretary seeks to protect

in an enforcement action differ from those protected in an

investigation. In both, she seeks to protect the interests of the

beneficiaries and to "secur[e] complete disclosure in order to

ferret out and discover any past wrongdoing affecting the

Fund." Fitzsimmons, 90 F.R.D. at 587. See also Doe, 162 F.3d

at 557 (acknowledging that the government "stand[s] in the

shoes of beneficiaries when it is investigating and prosecuting

malfeasance in the administration of an ERISA fund" in grand

jury proceedings) (emphasis added).8 Contrary to the Funds’

contention, the potential for public disclosure in the investiga-

tion context does not harm beneficiary interests any more than

in the enforcement context. And, while the potential for dis-

closure under a Freedom of Information Act request may be

somewhat burdensome, the Secretary has cited several avail-

able exceptions which make the likelihood of disclosure pur-

suant to such a request remote. Moreover, courts can fashion

an order to preclude subsequent third-party waiver claims and

minimize the risk of disclosure under FOIA, precisely as the

district court did in this very case. J.A. 85. At bottom, the

Funds’ attempts to distinguish DOL actions under § 502 from

§ 504 are unpersuasive.

8

While circumstances may arise in which the Secretary’s interests no

longer align with those of plan beneficiaries, that is not the case before us.

Accord Fitzsimmons, 90 F.R.D. at 586-87 (accepting that the interests of

the Secretary and the beneficiaries might diverge at some later date "with

DOL more interested in establishing a broad precedent to deter pension

plan maladministration and the beneficiaries more interested in securing

maximum restitution to the Fund for the payment of benefits" but finding

"no principled basis" for preventing the Secretary from invoking the fidu-

ciary exception "given the identity of interests" in the case at bar).

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 15

Bolstering our conclusion is the Secretary’s well-

established subpoena power in the context of investigating

potential ERISA violations. See, e.g., Donovan v. National

Bank of Alaska, 696 F.2d 678, 684 (9th Cir. 1983) (finding

broad investigative purpose sufficient to enforce subpoena);

Donovan v. Shaw, 668 F.2d 985, 989 (8th Cir. 1982) (recog-

nizing that agency "need not make any factual showing that

a law has been violated as a condition precedent to enforce-

ment" of subpoena). Although the Funds argue that this broad

investigatory subpoena power further distinguishes the Secre-

tary’s roles under § 502 and § 504, respectively, it instead

appears to underscore that Congress, in both provisions,

sought to provide the Secretary with a wide range of tools to

protect the interests of beneficiaries and participants.

Finally, we note that the facts of this case support the dis-

trict court’s disposition. The documents which the Funds were

required to disclose included Board of Trustee meeting min-

utes, handwritten notes distributed and taken during the meet-

ings, and correspondence that concerned the Madoff-related

investments. All of these documents appear clearly to relate

to the Funds’ administration, information which ERISA trust-

ees have a fiduciary obligation to disclose in response to a

subpoena from plan beneficiaries provided it does not involve

a trustee’s own legal defense.9 See Becher, 129 F.3d at 271-

72; Wildbur, 974 F.2d at 645; see also Mett, 178 F.3d at 1064

(recognizing this obligation extends to the government acting

"in the beneficiaries’ stead"). If the Funds are concerned that

there are privileged documents not subject to the fiduciary

exception in this array, they have failed to identify which doc-

uments should remain privileged and why. See United States

v. Jones, 696 F.2d 1069, 1072 (4th Cir. 1982) (noting that

burden rests with party claiming privilege to demonstrate its

9

In this circuit, a beneficiary is entitled to disclosure on demand, i.e.,

without a subpoena, of only those materials listed in ERISA, 29 U.S.C.

§ 1024(b)(4). See Faircloth v. Lundy Packing Co., 91 F.3d 648, 653-54

(4th Cir. 1996).

16 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

applicability to individual communications); Tatum, 247

F.R.D. at 493-95 (applying fiduciary exception to some, but

not all, documents after examining detailed privilege log for

"context and content"). Here, the Funds did not specify indi-

vidual communications to which the privilege applied or sub-

mit a privilege log for the district court’s assessment.

Accordingly, the district court properly applied the fiduciary

exception to the documents requested by the Secretary that

related to fund administration.

Because we find that the fiduciary exception applies to the

Funds’ claims of attorney-client privilege and no good cause

showing is required in the ERISA context, we find no error

in the district court’s order.

B.

We turn next to the Funds’ arguments concerning the attor-

ney work product privilege. Distinct from the attorney-client

privilege, the work product doctrine belongs to the attorney

and confers a qualified privilege on documents prepared by an

attorney in anticipation of litigation. Hickman v. Taylor, 329

U.S. 495, 509-14 (1947); In re Grand Jury Proceedings,

Thur. Special Grand Jury Sept. Term, 1991, 33 F.3d 342, 348

(4th Cir. 1994); Duplan Corp. v. Moulinage et Retorderie de

Chavanoz, 487 F.2d 480, 483, n.12 (4th Cir. 1973).

"[M]aterials prepared in the ordinary course of business or

pursuant to regulatory requirements or for other non-litigation

purposes" do not constitute "documents prepared in anticipa-

tion of litigation" protected by work product privilege. Nat’l

Union Fire Ins. Co. v. Murray Sheet Metal Co., 967 F.2d 980,

984 (4th Cir. 1992). As in the case of attorney-client privi-

lege, the party claiming the protection bears the burden of

demonstrating the applicability of the work product doctrine.

In re Grand Jury, 33 F.3d at 353.

The Funds argue that the district court erred in finding that

the fiduciary exception extends to require disclosure of mate-

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 17

rial covered by the work product doctrine.10 In support of their

contention, the Funds point to cases in which other courts

have refused to apply the fiduciary exception to attorney work

product. See, e.g., Jicarila Apache Nation v. the United States,

88 Fed. Cl. 1, 11 (2009) (refusing to apply fiduciary exception

to work product privilege in action by tribe against United

States for alleged mismanagement of tribal trust funds); Cox

v. Adm’r U.S. Steel & Carnegie, 17 F.3d 1386, 1423 (11th

Cir. 1994) (refusing to apply exception in action by union

members against union); In re Int’l Sys. & Controls Corp.

Sec. Litig., 693 F.2d 1235, 1239 (5th Cir. 1982) (refusing to

apply exception in shareholder derivative action because "mu-

tuality of interest" that existed to support attorney-client privi-

lege was destroyed once there was "sufficient anticipation of

litigation to trigger the work product immunity"). The Funds

also rely on our decision in Sandberg, in which we found that

the fiduciary exception did not apply to work product protec-

tion in the context of a shareholder derivative action. 979 F.2d

at 355, n.22. As we have noted, however, our decision in

Sandberg was vacated, see 1993 WL 524680, and does not

bind us. Moreover, Sandberg, along with the other cases cited

by the Funds, did not arise in the ERISA context; rather, these

cases involved corporate shareholder actions, union actions,

and actions relating to federal tribal authorities. The relevance

of these decisions to the application of the fiduciary exception

to work product protection in the ERISA context is question-

able at best.

As we explained in our discussion of attorney-client privi-

lege supra, the ERISA context differs from the corporate con-

text and more closely involves fiduciary duties owed directly

to participants and beneficiaries. Applying the logic of com-

10

The district court expressly excluded documents "prepared in connec-

tion with the Secretary’s investigation of the Plans" and those prepared

after March 24, 2009, in connection with the Meridian Fund litigation.

J.A. 84. The Funds nevertheless contend that the district court’s order

reaches protected materials.

18 SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC.

mon law trusts from which the fiduciary exception to the

attorney-client privilege was extrapolated to the ERISA con-

text, several courts have found that the exception similarly

applies to the work product doctrine, reasoning that a trustee’s

attorney should not withhold work product from the actual

client, i.e. the trust beneficiaries. See Everett v. USAir Group,

Inc., 165 F.R.D. 1, 5 (D.D.C. 1995) (finding that ERISA fund

attorneys may not "shield their attorney work product from

their own ultimate clients, the plan beneficiaries . . . insofar

as [documents] were prepared in anticipation of litigation on

behalf of the plan beneficiaries"); Valley Nat’l Bank, 140

F.R.D. at 320-21 (rejecting work product protection claim by

ERISA fund attorneys in context of DOL suit on behalf of

fund participants); see also Cobell v. Norton, 213 F.R.D. 1, 13

(D.D.C. 2003) (finding the work product doctrine "applicable

only where the material is developed exclusively for purposes

other than the benefit of trust beneficiaries, i.e., solely to aid

in litigation") (emphases added). Cf. Aull v. Cavalcade Pen-

sion Plan, 185 F.R.D. 618, 626 (D. Colo. 1998) (finding that

"when the documents at issue are related to allegedly

improper actions of ERISA fiduciaries, discovery often is per-

mitted despite a claim of work product privilege," but refus-

ing to reach the issue of whether fiduciary exception applied);

Fitzsimmons, 90 F.R.D. at 587-88 (requiring disclosure of

attorney work product relating to ERISA trustees’ investment

decisions, subject to good cause showing, "lest the work-

product immunity swallow up the [fiduciary] exception in its

entirety"). These persuasive authorities demonstrate that there

is no legitimate basis on which to distinguish between the two

privileges in the application of the fiduciary exception in the

ERISA context.

In any event, however, because of the way the Funds have

chosen to litigate this action— by failing to provide privilege

logs or identify the litigation for which specific documents

were prepared— we see no reason to reach the issue of

whether the work product doctrine is subject to the fiduciary

exception. As the party claiming privilege, the Funds bear the

SOLIS v. THE FOOD EMPLOYERS LABOR RELATIONS ASSOC. 19

burden of demonstrating the applicability of the privilege to

specific documents. In re Grand Jury, 33 F.3d at 353.

Because the Funds have failed to carry their burden to demon-

strate the applicability of the work product doctrine, we have

no reason to disturb the district court’s judgment.

III.

For the foregoing reasons, the district court’s order granting

the Secretary’s petition to enforce is

AFFIRMED.