# Amicus Brief — Upjohn Co. v. United States

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385006_2171%3A06

## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Brief
- **Published:** January 1, 1981
- **Citation:** 449 U.S. 383

## Text

MICHAEL , CLERK

IN THE

Supreme Court of the GQnited States

OctoBer Trrm, 1979

No. 79-886

THE UPJOHN COMPANY, et al.,

Petitioners
V

THE UNITED STATES OF AMERICA, et al.,
Respondents

ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT

MEMORANDUM
OF THE CHICAGO BAR ASSOCIATION
AS AMICUS CURIAE

RicHarD WiLLIAM AUSTIN KeitH F.. Bopr
President JENNER & BLock
Chicago Bar Association One IBM Plaza, 42nd Floor
29 South LaSalle Street Chicago, Illinois 60611
Chicago, Illinois 60603 Dire Miata
MicHasen H. Kine 200 East Randolph Street
Ross, Harpies, O’K&ErF, Room 5900
Bascock & Parsons Chicago, Illinois 60601

One IBM Plaza, Suite 3100
Chicago, Illinois 60611

AAT LE LEE OLE EE, POLE EDT LION Ee EO CLS SEN ELLE, I. ARETE
La Salle Street Press — Chicago Printed in U.S.A.

INDEX

EMAAR oo cos as ooo Sede ees nese e ea eee
Interests of the Amicus Curiae « . .o00sssnaeSeawcerks
re rrr rT Teor Oe
Question Presented ...... po > ou oe eae oe
pe eee Peer Tyrer

Cnmsloeing. oocviocnncikcviancs uvadawescnen tee

CITATIONS
CASES:

A. B. Dick Co. v. Marr, 95 F.Supp. 83, 102 (S.D.N.Y.
1950), appeal dsm’d, 197 F.2d 498 (2d Cir. 1951),
cert, denied, 344 U.S. 878 (1952) ........... eee eee

American Dental. Ass’n, FTC Dkt. 9093 (ALJ proc.
onder, Beat. Fi, IOTt) 6 siie'vi iv vind neneeme eee

Burlington Industries, Inc. v. Exxon Corp., 65 F.R.D.
p Sek | rrr rr

Diversified Industries, Inc. v. Meredith, 572 F.2d 596
Cite Ce. 2907) Cem BOE): ios aed eke

Duplan Corp. v. Deering Milliken, Inc., 397 F.Supp.
REGS CEAIAS. TPT) sf sida se enacee es ona

Garrison v. General Motors Corp., 213 F.Supp. 515
(BD SOR). oss cances<ehesk eae san eee

General Motors Corp., FTC Dkt. 9074 (ALJ Proce.
Gnier, SOM. BA Toews svc 646s sidan eee eee

Harper & Row Publishing, Inc. v. Decker, 423 F.2d 487
(7th Cir. 1970), aff'd by an equally divided court, 400
U.S. 348 (1971) reh. denied, 401 U.S. 950 (1971) ....

In re Ampicillin Antitrust Tatigation, 81 F.R.D. 377
* GERERDD. TOFD sie ics bes ceed cece eee ae

il

A

In re Grand Jury Investigation (Sturgis), 412 F.Supp.
EE) ee

In re Grand Jury Investigation (United States), 599
ES

In re Grand Jury Proceedings (Duffy), 473 F.2d 840
kn che ah eee send eda dame avaw

In re Grand Jury Proceedings (FMC Corp.), 604 F.2d
ND casas cscs cheese devas eananes

In re Grand Jury Proceedings (Lawson), 600 F.2d 215
ax daw s Keke ds R44 ee wo oH aes

In re Grand Jury Proceedings (McCoy), 601 F.2d 152
ee

In re Grand Jury Subpoena, Nov. 16, 1974, 406 F.Supp.
EE MEIED chews vesecscrsesesansvscees

In re Grand Jury Subpoena Dated July 13, 1979, 478
F.Supp. 368 (H.D.Wisc. 1979) ............05seeees

In re Grand Jury Subpoena (General Counsel, John
Doe, Inc.), 599 F.2d 504 (2d Cir. 1979) .............

In re Rosenbaum, 401 F.Supp. 807 (S.D.N.Y. 1973) ....
In re Stolar, 397 F.Supp. 520 (S.D.N.Y. 1975) .......

Matter of Grand Jury Subpoena, 438 F.Supp. 1176
ee

Matter of Grand Jury Subpoena Served Upon Field,
eres, 2900 €66.0.N.Y. 1976) 2... neces cee

Natta v. Hogna, 392 F.2d 686 (10th Cir. 1968) ........

Perrignon vy. Bergen Brunswig Corp., T7 F.R.D. 455
en ere eb Abid ones essaveneeadss

Safeway Stores, Inc., FTC Dkt. 9053 (ALJ proce. order,
oe gs ass bow waa ews oH 06

SEC vy. Dresser Industries, Inc., CCH Fed. See.L.Rptr.
AE A) a

PAGE

ed) |

PAGE

Sylgab Steel € Wire Corp. v. Moco-Gateway Corp., 62
F.R.D. 454 (N.D. Ill. 1974), aff’d., 584 F.2d 330 (7th

BA er ery oy Sere errr ear me ae 3
United States v. United Shoe Machinery Corp., 89
F Ban. Got (DP). Matty LGGG) iia cscs cc eisnssvccns 4
United States v. Upjohn Co., 600 F.2d 1223 (6th Cir.
SE ns bcd eC EE abe eee a OW EEN TR 7
Virgima Electric & Power Co. v. Sun Shipbuilding &
D.D. Co., 68 F.R.D. 397 (.D.Va. 1975) ............ 4
STATUTES :
Federal Rules of Civil Procedure 30(b)(6) ........... 6

Federal Rules of Civil Procedure 33 ................. 6

IN THE

Supreme Court of the Qnited States

OctoBer Term, 1979
No. 79-886
THE UPJOHN COMPANY, et al.
Petitioners
v.
THE UNITED STATES OF AMERICA, et al.,
Respondents

ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT

MEMORANDUM
OF THE CHICAGO BAR ASSOCIATION
AS AMICUS CURIAE

This memorandum of the Chicago Bar Association is
filed with the consent of all parties and in support of the
petition for a writ of certiorari on the issue of the attorney-
client privilege.

INTERESTS OF THE AMICUS CURIAE

The Chicago Bar Association is an association of more
than 14,000 lawyers and judges who practice in the metro-
politan Chicago, [llinois area. The diversity of their prac-
tices and the range of their interests in areas of concern
to the profession is limited only by the parameters of
modern business practice. Many of the Association’s mem-
bers are actively engaged in counseling and otherwise repre-
senting corporations and their employees with business

2

activity both within and without the State of Illinois and
its contiguous neighbors. The existing uncertainty with
respect to the scope of the attorney-client privilege has a
substantial disruptive influence on a lawyer’s ability to
discharge his professional responsibility in representing
and advising corporations.

STATEMENT

The facts and proceedings below are fully set forth in
the petition.

QUESTION PRESENTED

Whether communications between an employee of a cor-
poration and an attorney for the corporation, relating to
the subject matter of the employee’s duties and involving
legal services being performed for the corporation by the
attorney, both of whom treat the communication as neces-
sary and confidential, are protected from unauthorized dis-
closure by the attorney-client privilege.

3
ARGUMENT

This case presents an opportunity for the Court to re-
solve a clear conflict between the circuits on a question of
substantial practical application. The Sixth Circuit has
now adopted the “control group” test for determining the
extent of the attorney-client privilege, thus joining the
Third Cireuit (In Re Grand Jury Investigation, 599 F.2d
1224 (3rd Cir. 1979)) and perhaps the Tenth Circuit (see
Natta v. Hogna, 392 F.2d 686 (10th Cir. 1968)). The “sub-
ject matter” test, on the other hand, is the law in the Seventh
Cireuit (Harper & Row Publishing, Inc. v. Decker, 423 F.2d
487 (7th Cir. 1970), aff’d by an equally divided court, 400
U.S. 348 (1971), reh. denied, 401 U.S. 950 (1971); Sylgab
Steel G Wire Corp. v. Moco-Gateway Corp., 62 F.R.D. 454
(N.D. Ill. 1974), aff'd, 534 F.2d 330 (7th Cir., i1976)) and
in the Highth Circuit (Diversified Industries, Inc. v. Mere-
dith, 572 F.2d 596 (8th Cir., 1977) (en banc)).

Of the remaining six circuits, the weight of authority in
the Fourth, Ninth, and District of Columbia Circuits sup-
ports use of the “subject matter” test. Burlington Indus-
tries, Inc. v. Exuxon Corp., 65 F.R.D. 26 (D.Md. 1974) ;*

*This case is sometimes erroneously cited as a “control
group” decision. E.G., Note, Corporate Attorney-Client
Privilege—Diversified Industries, Inc. v. Meredith—The
Modified Harper & Row Test, 4 J.Corp.L. 226 (1978).
It clearly is not, for the court expressly held that the
privilege extended to intracorporate documents “which
are prepared at the direction of members of the control
group to aid counsel in rendering legal assistance to the
corporation, at the express or implied request of counsel,
and which are primarily legal in nature” (65 F.R.D. at
39), that the request to the attorney for legal advice
could also be “implied” (65 F.R.D. at 37), and that the
“direction” from a control group member to a lower-level
corporate employee could likewise be implicit. (65 F.R.D.
at 38.)

4

Duplan Corp. v. Deering Milliken, Inc., 397 F.Supp. 1146
(D.S.C. 1974), Perrignon v. Bergen Brunswig Corp., 77
F.R.D. 455 (N.D.Cal. 1978); In re Ampicillin Antitrust
Intigation, 81 F.R.D. 377 (D.D.C. 1978).* The Second Cir-
cuit recently declined to resolve the conflict in In re Grand
Jury Subpoena (General Counsel, John Doe, Inc.), 599
F.2d 504, 511 (2nd Cir., 1979). There are no recent cases
from the First Circuit, but the leading case of United States
v. United Shoe Machinery Corp., 89 F.Supp. 357 (D.Mass.
1950), held that communications from all corporate agents
are protected. A number of federal administrative decisions
have likewise adopted the “subject matter” test.** The
importance of predictability in matters relating to the
attorney-client privilege supports the granting of certiorari
to resolve the current conflict—regardless of the result.

In addition, it is the position of the Chicago Bar Asso-
ciation that the issue should be resolved by adoption of the
subject matter test. The purpose of the attorney-client
privilege is to encourage by confidentiality full and truthful
communication of the facts by the client to his attorney and
candid advice by the attorney to the client. Where the client
is a corporation, these purposes cannot be served by limiting
the attorney-client privilege to communications between
counsel and members of the “control group.” Generally, it
is operating employees outside of the control group who
have knowledge of the facts which the attorney needs to
learn. Similarly, the attorney’s legal advice and instruce-
tions, to be effective, must be communicated to the corporate
employees on the “firing line”.

*A contrary case from the Fourth Circuit is Virginia
Electric & Power Co. v. Sun Shipbuilding & D.D. Co.,
68 F.R.D. 397 (H.D.Va. 1975). Cf. Garrison v. General
Motors Corp., 213 F.Supp. 515 (S.D.Cal. 1963).

** Safeway Stores, Inc., FTC Dkt. 9053 (ALJ proce. order,
June 30, 1976); American Dental Ass’n, FTC Dkt. 9093
(ALJ proc. order, Sept. 27, 1977) ; General Motors Corp.,
FTC Dkt. 9074 (ALJ proce. order, Jan. 25, 1978).

4)

The control group test, therefore, is an artificial restric-
tion which cannot be justified by reason of the nature and
rationale of the attorney-client privilege. Indeed, this test
directly conflicts with the entire basis of the attorney-client
relationship by making the attorney’s fact gathering from
corporate employees and his advice to corporate employees
potentially available to adverse parties for use against his
client.

The practical implications of the “control group” test in a
business environment populated by corporations and in-
creasingly exposed to litigation are far reaching. The most
obvious and predictable result of an application of the
“control group” test may well be attorneys for corporations
parading to the witness stand to testify about what they
learned from corporate employees in the course of their
representation of the corporation.*

* Attempts to obtain attorney’s testimony or records are
increasing rapidly in number, particularly in Government
investigations. In addition to Upjohn, see, e.g., In re
Grand Jury Proceedings (FMC Corp.), 604 F.2d 798 (3d
Cir. 1979); In re Grand Jury Proceedings (McCoy), 601
F.2d 152 (5th Cir. 1979) ; In re Grand Jury Proceedings
(Lawson), 600 F.2d 215 (9th Cir. 1979) ; In re Grand Jury
Investigation (United States), 599 F.2d 1224 (3d Cir.
1979); In re Grand Jury Subpoena (General Counsel,
John Doe, Inc.), 599 F.2d 504 (2d Cir. 1979) ; In re Grand
Jury Proceedings (Duffy), 473 F.2d 840 (8th Cir. 1973) ;
In re Grand Jury Subpoena Dated July 13, 1979, 478
F.Supp. 368 (i.D.Wise. 1979); Matter of Grand Jury
Subpoena, 438 F.Supp. 1176 (S.D.N.Y. 1977) ; In re Grand
Jury Investigation (Sturgis), 412 F.Supp. 943 (E.D.Pa.
1976); Matter of Grand Jury Subpoenas Served Upon
Field, 408 F.Supp. 1169 (S.D.N.Y. 1976); In re Grand
Jury Subpoena, Nov. 16, 1974, 406 F.Supp. 381 (S.D.N-Y.
1975); In re Rosenbaum, 401 F.Supp. 807 (S.D.N-Y.
1975) ; In re Stolar, 397 F.Supp. 520 (S.D.N.Y. 1975).

6

‘\

The routine use of attorneys as witnesses against their
clients is of course unseemly and directly contrary to the
whole concept of the attorney-client relationship. The situa-
tion can only result in less effective legal representation for
the corporation.

This result cannot be justified on the ground that it is
the only feasible method for litigants to extract necessary
information from corporate adversaries. The federal rules
require the production of all relevant documents relating to
the subject matter of the litigation. Ali corporate employees
may be required to testify concerning their knowledge of the
facts. Interrogatories pursuant to Rule 33, Federal Rules
Civil Procedure, require the corporation to assemble and
provide all information in the possession of its employees.
Under Rule 30(b) (6), FRCP, a corporation may be required
to designate a witness or witnesses who must testify to
matters “known or reasonably available” to the corporation.
There has been no showing that these discovery procedures
are inadequate. Certainly there is no showing that the
discovery process cannot function without making the
attorney a witness against his client.

In a lawsuit the attorney has an obligation to determine
the facts. He must therefore go where the facts are found.
An antitrust case involving allegations of price fixing can
not be defended without the defendant’s attorney interview-
ing the sales personnel, nor prosecuted without the plain-
tiff’s attorney interviewing the purchasing agents. Simi-
larly, a product design defect case can not be defended
without the attorney interviewing the design engineers, nor
prosecuted without interviewing the corporate employees
who either bought, serviced or operated the allegedly de-
fective equipment. Rarely will such individuals be members
of the control group.

7

In a “control group” jurisdiction an attorney representing
a corporation can have little confidence that his efforts in
assembling information from his client may not ultimately
be used to his client’s detriment. Certainly the attorney
must have reservations about assuring his client the com-
munications will be kept confidential. In turn the corporate
employees must have reservations about what to tell the
corporation’s lawyer. The effect may well be longer, more
expensive, less efficient litigation since the lawyers repre-
senting the corporation may be forced to temper their
factual research from fear of being turned into third parties
for discovery purposes.

Compliance programs and similar internal examinations
cannot be conducted with confidence in their confidentiality
in a “control group” jurisdiction and therefore may well be
less frequently or thoroughly done. Discouraging self-
policing efforts is not of benefit to the public since the prac-
tice is generally considered beneficial, and perhaps is an
essential adjunct to official enforcement of laws governing
corporate conduct. The increasing frequency of such pro-
grams is indicated by the numerous reported decisions in-
volving such internal corporate investigations.* However,
since the alleged violations are generally neither committed
by nor known to members of the “control group,” adoption
of the “subject matter” test for application of the privilege
is essential to the continued viability of the practice. Other-
wise, as in Upjohn, counsel conducting such inquiries will
likely become witnesses against their clients.

* SEC v. Dresser Industries, Inc., CCH Fed.Sec.L.Rptr.
{97,172 (D.C.Cir. 1979); United States v. Upjohn Co.,
supra; Diversified Industries v. Meredith, supra; In re
Grand Jury Investigation (United States), supra; In re
Grand Jury Subpoena (General Counsel, John Doe, Inc.),
supra; In re Grand Jury Subpoena Dated July 13, 1979,
supra.

8

The net effect of an erosion of confidence by the corpora-
tion in the privileged nature of communications with its
lawyers will be to reduce significantly the ability of the
corporation to obtain the effective assistance of counsel.
A corporation should not be forced to use lawyers who are
unable to prepare properly. A lawyer should not be forced
to represent a corporation with his head in the sand. A
corporate client must trust its lawyers to learn the facts
necessary to properly advise it and the lawyer must be able
to give advice based on as complete knowledge as possible.

Corporate clients need full and frank legal advice as
much as natural persons. Judge Medina pointed out in
A.B. Dick Co. v. Marr, 95 F.Supp. 83, 102 (S.D.N.Y. 1950),
appeal dsm’d, 197 F.2d 498 (2d Cir. 1951), cert. denied, 344
U.S. 878 (1952) :

“Since [the] early statements [of the purposes of the
privilege], the necessity of protecting the attorney-
client relationship has become even more apparent; the
legal rights and duties of large corporations and those
who dispute with them would not be susceptible of
judicial administration in the absence of lawyers, nor,
in the absence of the privilege could lawyers properly
- represent their clients.”

The rejection of the “control group” test and the adoption of
the “subject matter” test will best effectuate these principles.

9
CONCLUSION

For the reasons set forth above, the petition for a writ
of certiorari should be granted.

Respectfully submitted,

The Chicago Bar Association

RicHarp WiLLiAmM AUSTIN
President
29 South LaSalle Street
Chicago, [llinois 60603

Micwaeu H. Kine

Ross, Harpigs, O’KEeErFr,
Bascock & Parsons
One TBM Plaza, Suite 3100
Chicago, Illinois 60611

Kurrn F.. Bope

JeNNER & BLock
One IBM Plaza, 42nd Floor
Chicago, Illinois 60611

Dante, A. EDELMAN
200 Kast Randolph Street
Room 5900
Chicago, [Illinois 60601

Dated: January 24, 1980

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385006_2171%3A06. Public record. Not legal advice.