Petition for Writ of Certiorari — XYZ Corp. v. United States

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92-1659 [Ea

6 = Q f SiaRbeE

No.

Po

Fa et ? 4 1993

o &s ft

IN THE ees

Supreme Court of the Wuited States

OCTOBER TERM, 1992

XYZ CORPORATION, et al.

‘ Petitioners,

UNITED STATES OF AMERICA,

Respondent.

Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Second Circuit

PETITION FOR A WRIT OF CERTIORARI

Of Counsel:

ARNOLD S. SCHICKLER

VINCENTI & SCHICKLER

Three New York Plaza

New York, NY 10004

(212) 509-9800

JOHN F. KALEY

WEINBERG, KALEY &

PERGAMENT, P.C.

585 Stewart Avenue

Garden City, NY 11530

(516) 222-2323

JAMES O. DRUKER

KASE & DRUKER

1325 Franklin Avenue

Garden City, NY 11530

(516) 746-4300

(LIFTON S. ELGARTEN *

BRIAN C. ELMER

CARY H. PLAMONDON

PETER J. ROMATOWSKI

CROWELL & MORING

100i Pennsylvania Ave., N.W.

Washington, D.C. 20004-2595

(202) 624-2500

HIEFRALD PRICE FAHRINGER

LIPSITZ, GREEN, FAHRINGER,

ROLL, SALISBURY & CAMBRIA

1190 East 59th Street

New York, NY 10022

(212) 909-9670

A/iorneys for Petitioners

(‘ounsel of Record

WILSON - EPES PRINTING CO.,

- 769-0096 - WASHINGTC

nN, D.C, 20001

QUESTION PRESENTED

\\ | Thy ! thy fj mt o«ofl Opypany emplo 11) oOmpyl rye

lormation and preparing analyses at the request of cour

| to assist the Company in defense of a criminal investi

mation is protected by the work product doctrine

il

PARTIES TO THE PROCEEDING BELOW

This petition is filed on behalf of all appellants in the

court below. This case arose out of a civil contempt pro-

ceeding in connection with a grand jury investigation.

The United States was the sole appellee. With the ex-

ception of the United States, all parties have been referred

to by pseudonyms to protect the secrecy of the grand

jury. XYZ Corporation is a target of the grand jury in-

vestigation.” XYZ Corporation’s work product immunity

is at issue on this petition. There are five additional

petitioners, the remaining eppellants below. John Doe

#1], #3, #5, and #6 are four employees of XYZ Corpo-

ration who asserted privilege on the Company’s behalf in

the grand jury. Richard Roe is the President of XYZ

Corporation and has also been identified as a target of the

grand jury investigation.

‘A letter identifying the true name of XYZ Corporation has been

lodged with the Clerk under seal. Pursuant to Rule 29.1, petitioners

state that XYZ Corporation has no parent corporation and no sub-

sidiary corporations (except wholly owned subsidiaries ).

TABLE OF CONTENTS

TABLE OF AUTHORITIES

OPINIONS BELOW

JURISDICTION

STATEMENT OF THE CASE

Summary

The Grand Jury Investigation

Proceedings In The District Court

Proceedings In The Court Of Appeals

REASONS FOR GRANTING THE WRIT

I. THE DECISION BELOW UNDERMINES

THE WORK PRODUCT DOCTRINE BY

ELIMINATING PROTECTION FOR “ORDI-

NARY” OR “FACT” WORK PRODUCT PRE-

PARED BY A PARTY, AT THE REQUEST

OF COUNSEL, TO AID IN ITS OWN DE-

FENSE

Il. THE DECISION BELOW CREATES A

SERIES OF ANOMALIES AND UNDER-

MINES THE ATTORNEY-CLIENT PRIVI-

LEGE

Il. THE DECISION BELOW PRESENTS A

CLEAR CONFLICT WITH THE PRECE-

DENTS OF THIS COURT AND OTHER

COURTS OF APPEALS ON AN IMPORTANT

QUESTION OF FEDERAL LAW

CONCLUSION

(iil)

Paye

~

20

i)

A)

iv

TABLE OF AUTHORITIES

CASES Page

Admiral Ins. Co. v. United States Dist. Court, 881

F.2d 1486 (9th Cir. 1989) .. a ses 16

Duplan Corp. v. Moulinage et Retorderie de

Chavanoz, 509 F.2d 730 (4th Cir. 1974), cert.

denied, 420 U.S. 997 (1975) ................ ivinvstie ta oe

Ford v. Phillips Elecs. Instruments, Co., 82 F.R.D.

ee Cac le EE ariebeteeestervatanaeacbadoncxeaseionacs 18

FTC v. Grolier Inc., 462 U.S. 19 (1983) ................... 10

Hickman v. Taylor, 329 U.S. 495 (1947) —......0....... passim

In re Chrysler Motors Corp. Overnight Ev aluation

Program Litig., 860 F.2d 844 (8th Cir. 1988)... 15-16

In re Int’l Sys. & Controls Corp., 693 F.2d 1235

to A RL RENE A 2 Se Se CO OR eo 15

In re Murphy, 560 F.2d 326 (8th Cir. 1977) ........... 12, 16

In re San Juan Dupont Plaza Hotel Fire Litig.,

859 F.2d 1007 (1st Cir. 1988) ............ seek acectce 12, 15

In re Sealed Case, 676 F.2d 793 (D.C. Cir. 1982).. 16

International Business Mach. Corp. v. Edelstein,

526 F.2d 37 (2d Cir. 1975) . 18

Marine Petroleum Co. v. Champlin Petroleum Co.,

641 F.2d 984 (D.C. Cir. 1980) . See anette 17

National Union Fire Ins. Co. v. Murray Sheet

Metal Co., 967 F.2d 980 (4th Cir. 1992) .......... 15

Sporck v. Peil, 759 F.2d 312 (3d Cir.), cert. de-

nied, 474 U.S. 903 (1985) . . 15

Toledo Edison Co. v. GA Technologies, Inc., 847

ee ee I ee OR ideas ccc eee 15

United States v. Leggett & Platt, Ine., 542 F.2d

655 (6th Cir. 1976), cert. denied, 430 U.S. 945

{5S RA ESRRIRIREESS ea en ante 2 15

United States v. Nobles, 422 U. S. 225 (1975). . 10, 20

United States v. Schwimmer, 892 F.2d 237 (24

Cir. 1989) ; sa jadesiapasaaibciaeacaaatatas 19

Upjohn Co. v. United States, 449 US. 383

MINIT cave ctthastanaissstcancctcecinn mer mamaeatemnebaseatineis tartan passim

STATUTES

28 U.S.C. § 1254(1) 2

LP 8 oa | - ; Ean nnee nD SV ctasiagiceer 3

TABLE OF AUTHORITIES—Continued

Page

28 U.S.C. § 1345 3

28 U.S.C. § 1826 3

FEDERAL RULES

Fed. R. Civ. P. 26 ; SIRES veceee--- PQASSIM

OTHER AUTHORITIES

4 J. Moore et al., Moore’s Federal Practice © 26.64

(2d ed. 1993) 12, 16, 18, 19

Special Project, The Work Product Doctrine. 68

Cornell L. Rev. 760 (1983) 18,19

IN THE

Sigivene Cert of the United States

OcTOBER TERM, 1992

XYZ CORPORATION, et al.

Petitioners,

v.

UNITED STATES OF AMERICA,

Respondent.

Petition for a Writ of Certiorari to the

United States Court of Appeals

for the Second Circuit

PETITION FOR A WRIT OF CERTIORARI

Petitioners respectfully pray that a writ of certiorari

issue to review the judgment and opinion oi the United

States Court of Appeals for the Second Circuit dated

November 19, 1992.

OPINIONS BELOW

The opinion of the United States Court of Appeals

for the Second Circuit dated November 19, 1992 is re-

ported at 979 F.2d 939 and is set forth in the Appendix

at la-Il5a. The district court order which gave rise to

the appeal is not reported and is set forth in the Appendix

at 16a-33a. The district court opinion as set forth in the

Appendix substitutes appropriate pseudonyms for the

names of the parties involved.

5

aa

JURISDICTION

The opinion of the Court of Appeals was issued and

judgment entered on November 19, 1992. A timely peti

tion for rehearing was denied on January 15, 1993. App.

at 34a-35a. This petition is filed within ninety days of

the denial of the petition for rehearing. The Court has

jurisdiction pursuant to 28 U.S.C. § 1254(1).

STATEMENT OF THE CASE

This petition presents the question whether the effort

of company employecs who gather information at the

direction of counsel in order to defend the company in

a grand jury investigation is protected by work product

immunity. The court below held that the work product

doctrine does not bar opposing counsel from = inquiring

into the fact-finding and analysis performed by such

employees, or into the conclusions they reached as a

result of their efforts. As shown below, that holding

is in direct conflict with the decisions of this Court

and other circuits considering these issues. Because

the decision below addresses an issue confronted daily by

litigants preparing comp!ex cases for trial, it will have an

immediate and pervasive impact in many cases now pend-

ing in the federal courts. If uncorrected, it will affect the

conduct of litigants in virtually every future case involv-

ing complex facts.

Summary

The government initiated this action on March 19.

1992 by obtaining an order to show cause why six grand

jury witnesses, employees of XYZ Corporation (the

“Company” ), who had asserted the Company’s attorney-

client and work product privileges in response to ques-

tions posed to them in the grand jurv, should not be held

in contempt.’ The district court had subject matter jur-

1! Contempt proceedings against two of the six emplovee-witnesse

were dismissed because it turned out that they had never becn asked

the questions that were the subject of the order to show cause.

ee

isdiction over the civil contempt proceeding pursuant to

KR ETS ( 1R26. 1331 and 1345. The Company itself,

and Richard Roe, Chairman and President of the

{ ompan horcet of the investigation——intervened to

protect the Company's privilege claims. They moved

(along with the witnesses) to quash the grand jury sub

poenas with respect to questions about studies these em

ployees had done at the specific request of counsel to

assist the Company in formulating its defense.

On June &, 1992. the United States District Court for

the Eastern District of New York for the most part de

nied the motion to quash and directed the witnesses to

respond to the questions posed by the prosecutor about

the studies they conducted ()n November 19, 1992, a

panel of the Court of Appeals for the Second Circuit

iffirmed, with modification, the “district courts order

compelling [the employee-witnesses| to answer certain

listed questions " App. at 12a On January 15

1993, the Court of Von i lenied \pp bicthits Joint P

tition for Rehearing

The Grand Jury Investigation

As noted by the court b A ine fact : ise ar

traightforward and undisputed.” App. at 3a

The Company is in the business, inter alia, of desig

ng and biujld ised

itellites and tn ot} ipplicatior / \ grand \jur )

the Eastern Dist: yf New York sating

the Company and its senior managem vit pect

rtain subcontracts pet Cor A ind anot r

firm in connection with a project for a federai go

Ty) an aven { ne ia? ont ac T } \ abe) iT i la {

j ipparentl he pr Ser itor’ pos |< if ie Con a

yverstated it osts Ww 1 submitting iche r work

performed on those subcontract \np. at ta

r ‘ +

EEE

4

The Company learned of the investigation when search

Warrants Were executed and grand jury subpoenas were

served for Company records, and promptly retained out-

side counsel to begin considering its defense. In January

1991, counsel asked emplovees familiar with certain tech-

nical aspects of the Fox program to address issues rele-

vant to the Companys potential defenses.’ The em-

Dlovees did so, reporting to counsel on the results of their

efforts.

One year later, on January 27, 1992, the government

conducted pre-grand jury interviews of Company em-

plovees who had been involved in those earlier efforts

for counsel. In those interviews, the government inquired

about any analyses these employees had performed. Upon

learning that the prosecutor was making such inquiries,

counsel for the Company wrote to the prosecutor and to

the emplovee-witnesses’ personal counsel. asserting the

Company's attorney-clicnt and work product privileges.

The Company asked the government to refrain from ask-

Ing questions about work performed for Company coun-

sel. App. at Sa.

The next day, the government asked several witnesses

the contested questions in the grand jury. Each witness

* The affidavits submitted to the district court establish that each

employee knew that counsel had commissioned the analysis, that the

employees had respected their obligation to maintain confidentiality,

and that the employees reported their results to counsel. See App.

at 27a.

One theory of defense required that estimates be made by persons

familiar with hardware for the subcontracts: a frequeney source

amplifier, a voltage controlled crystal oscillator, a frequency multi-

plier power amplifier, a calibration upconverter, a reference gen-

erator unit, and a surface acoustic wave oscillator. App. at 4da-5a.

An in cemera affidavit of counsel, submitted to the court below,

explains this initial theory of defense and how the efforts of the

employce-witnesses fits in with that theory. See App. at 26a. It is

sufficient for purposes of this petition to note the uncontested fact

that the work that was performed by these employees was performed

for counsel in order to assist in the Company’s defense.

—————————EE—————E——————————e ”

5

declined to answer, asserting privileges on the Company's

behalf. Jd. The government then obtained an order to

show cause why the employees should not be held in

contempt,

Proceedings In The District Court

The government provided the court and the parties

with paraphrased versions of the questions at issue. It

identified various questions which it had actually asked

the witnesses (Category “I” App. at 13a), and provided

an additional set of questions that it proposed to ask in

the future (Category “li.” App. at I3a-I4a). The ques-

tions (and responses by the witnesses to the Category “Tl

questions) demonstrate that the government sought to

inquire directly about the analyses these employees per-

formed for Cempany counsel after the Company had

learned of the investigation. The Category “II questions

inquire even more deeply and directly into the employees’

undertaking and the conclusions they drew from. their

efforts.” See App. at I3a-I4a,

The Company had suggested that because the govern-

ment had available to it all of the relevant records, the

government could simply ask the witnesses to conduct

analvses of the government’s choosing, instead of asking

them about the analyses they had done for Company

counsel. See App. at 5a. The government declined to

adopt the Company's suggestion. /d. [It did, however,

4 Several of the witnesses read a statement in response to the

prosecutor’s questions setting forth their understanding that the

Company was asserting the confidentiality of the attorney-clien!

privilege and work product doctrine for “all information and ma-

terials generated” at the direction of counsel. App. at 5a.

5 The written reports containing the employees’ estimates and

conclusions were submitted by the Company to the district court

for in camera inspection, along with affidavits of counsel. The

government has repeatedly conceded, and the district court and

Court of Appeals acceptea (App. at 7a, 26a), that these written

reports are privileged and need not be disclosed.

6

formulate a third set of questions which it submitted to

the district court. (Category “III,” App. at I4a-I5a).

The Company conceded that these “Category III” ques-

tions, which do not inquire about the analyses performed

for counsel, could properly be asked by the government

(provided the witnesses were instructed to answer from

their pre-existing knowledge of the underlying facts and

without reference to their work for Company counsel).

The district court nonetheless rejected the Company's

privilege claims. The court noted that the government

did not dispute that copies of the written reports were

protected by the attorney-client privilege. App. at 26a.

The court held. however. that the government was free

to inquire orally about the employees’ efforts and the

conclusions drawn from those efforts because those efforts

and conclusions were “underlying facts and opinions.”

App. at 30a.

Proceedings In The Court Of Appeals

On appeal of the district court's order. the Company

stressed that the “analyses performed ... and the factual

results requested by the government are not pre-existing

facts known to the witnesses prior to their communica-

tions with counsel: they are new facts specially created

at the request of counsel.” Thus, the application “of the

privileges to these analyses does not hide something that

the witnesses knew before they communicated with coun-

self. I]t protects a body of information that did not exist

until after counsel requested it.”

Nonetheless. the Second Circuit affirmed the district

courts decision in substantial part. It held that by

“fe]xamining the 23 questions we see no trampling of

either privilege. except in four questions.” " App. at 10a.

6 Sce App. at 14a. The questions the panel deemed improper (Nos.

8, 9, 14, 15) were those which inquired into or referred to actual

discussions with counsel. The court said that “[t]he form of these

four questions, considered in sequence, risks violation of the attor-

EEO

7

Specifically, with respect to work product, it concluded

that because the “attachments to the affidavits appear to

be nothing but straightforward calculanions trom raw

data.” the work product protection does not apply. App.

at Ila.

REASONS FOR GRANTING THE WRIT

This petition presents an important question about the

right of a company and its counsel to enlist the assistance

of the company’s employees in preparing to defend a

civil or criminal iawsuit. In holding that the efforts of

such employees are not protected as work product, the

decision below conflicts with this Court’s precedents and

the decisions of other federal courts of appeals on a fun-

damental question of federal law and tederal practice.

If uncorrected, the decision will have a pervasive impact

on investigations and trial preparation in a wide variety

of cases.

The decision below creates a rule that “no common

law privilege” prevents a party from first establishing that

his adversary’s employees conducted purely factual ana-

lyses at the direction of counsel in anticipation of litiga-

tion, and then inquiring further:

“[W hat did you do [to analyze the facts in issue]?”

“{W Jhat analysis did you conduct?”

“What reviews of [the disputed contracts] did you

conduct?” |

“What conclusions did you draw?” |

App. at 13a, 14a (Questions I.1; 1.3: [.4: ILA.13).

Any attorney who has tried to make an initial assess-

ment of a client's position in connection with a complex

case. or who has tried to prepare such a case for trial.

ney-client privilege because the witness, in responding, might be

understood to be implying to the grand jury that he had conveyed

privileged information to the lawyer.” App. at lla.

OO EEEEEeaGWCET

8

knows how important it is to be able to obtain the assist-

ance of company employees in rooting out the facts.

testing theories and arriving at conclusions about how

best to proceed. The need to draw upon the resources of

the client to gather, analyze. and decipher technical or

financial data arises in virtually all such cases. Indeed,

it is the right of a litigant—whether it be a company

through its employees. or an individual through his or

her own action—to assist in its own defense, without fear

that its efforts will be automatically discoverable by its

adversary.

In holding that “no common law privilege” bars oppos-

az counsel from inquiring directly into the efforts of a

litigant and its employees to prepare a defense (at leas!

so long as those efforts do not appear to involve mental

impressions ). the court below has reached a result sharply

at odds with the law set forth in this Court’s decisions.

The decision of the court below would provide a ready

mechanism by which a litigant could bootstrap on the

efforts of its more diligent opponent to investigate and

vather the facts—a result heretofore regarded, under this

Court's decisions. as inconsistent with the premises of the

adversary system. Indeed, a party need only threaten

suit and, if the target of the threat responds by calling in

counsel and conducting a thorough investigation, that

party may simply ciaim the fruits of the investigation (at

least in unwritten form) for its own.

Because it addresses a core aspect of discovery and

case preparation, the immediate effects of this dectsion

will be far-reaching. limiting the ability of attorneys in

both criminal and civil cases to enlist the aid of their

clients’ employees in preparing their cases. The risk of

disclosure will cause many litigants to think twice before

embarking upon any sienificant effort at case analysis and

fact-finding. knewing that the product of that effort will

—) > bar +},

ry?

e opposing side. The prejudice borne

iw

by the cient in these circumstances will not be redressed,

Y

for those who are dissuaded by this decision from pro-

ceeding with a thorough investigation will not have any

right of appeal. Gn the other hand, attorneys who have

relied on the decisions of this Court to enlist the aid of

their clients’ employees for assistance in gathering facts

for trial will now find the product of their efforts disclosed

to their opponent. But despite the importance of the ques-

tion presented. it is not likely to reach the court again

soon because questions of privilege are frequently inter-

locutory in nature, and are not readily appealed.

Thus. certiorari should be granted in this case to re-

store work product immunity to a litigant’s own efforts

in preparing a defense.

I. THE DECISION BELOW UNDERMINES THE

WORK PRODUCT DOCTRINE BY ELIMINATING

PROTECTION FOR “ORDINARY” OR “FACT”

WORK PRODUCT PREPARED BY A PARTY, AT

THE REQUEST OF COUNSEL, TO AID IN ITS

OWN DEFENSE

Since this Court’s decision in Hickman v. Taylor, 329

U.S. 495 (1947), the federal courts have recognized

that a pariy’s efforts in anticipation of, or preparation

for, litigation, are presumptively shielded from discovery

by the work product principle. The court below none-

theless observed that “[w]hether the work product of

counsel gathered and devised in preparation for htiga-

tion, such’as facts, legal contentions or trial tactics, may

be discovered is a highly controversial area of the law,

as this case illustrates. The boundaries of the [work prod-

uct] doctrine are far from fixed.”‘ App. at 9a.

‘The assessment of the court below mirrored a similar assess-

ment nearly twenty years ago in Duplan Corp. v. Moulinage et

Retorderie de Chavanoz, 509 F.2d 730, 733 (4th Cir. 1974). cert.

denied, 420 U.S. 997 (1975): “[T]he most controversial problem

in the discovery area is the extent to which a party may require

divulgence of facts, legal contentions, or trial tactics gathered or

devised by his adversary in preparation for litigation.” In the 20

Se eo

10

Notwithstanding that observation, presumably — ad-

dressed to the treatment of work product by the lower

courts, this Court has repeatedly reatlirmed the existence

of work product immunity as a “basic rule in the litiga-

tion context.”. FTC vy. Grolier, Inc., 462 U.S. 19, 24

(1983); see Upjohn Co. v. United States, 449 U.S. 383

(1981): United States v. Nobles, 422 U.S. 225 (1975);

Hickinan, 329 U.S. 495. The “ ‘strong public policy’

underlying the work product doctrine,” Upjohn, 449 US.

at 398. has uniformly been taken as the guidepost in its

application.

The work product privilege allows a litigant “a certain

degree of privacy. free from unnecessary intrusion by

opposing parties . . . [to] prepare his legal theories and

plan his strategy without undue and_ needless interfer-

ence.” Hickman, 329 U.S. at 510-11. Although the work

product “privilege” is frequently asserted in civil cases,

it is even more “vital” in criminal cases because “the

question of guilt or innocence demands that adequate

safeguards assure the thorough preparation and _ presenta-

tion of each side of the case.” Nobles, 422 U.S. at 238.

The rationale tor the rule is simply that without it, a

litigant will be constrained in mounting its defense by the

fear that its own efforts will prove even more beneficial

to its adversary than to itself:

Were [work product] materials open to opposing

counsel on mere demand . . . [1]nefliciency, unfair-

ness and sharp practices would inevitably develop in

the giving of legal advice and in the preparation of

cases for trial. The effect on the legal profession

wou'd be demoralizing. And the interests of the

vears since Duplan, apparently little has been done to eliminate the

controversy in this fundamental area of practice. As evidenced by

the decision of the court below, there continues to exist a tendency

to treat the resolution of cases involving the work product doctrine

as calling for the weighing of broad policies, instead of applying

the precedents established by this Court.

11

clients and the cause of justice would be poorly

served.

Hickman, 329 U.S. at 511. As noted in Upjohn, “{dlis-

covery was hardly intended to enable a learned profes-

sion to perform iis functions .. . on wits borrowed trom

the adversary.” 449 U.S. 383, 396 (1981), quoting Hick-

man, 329 U.S. at 516 (Jackson, J.. concurring).

Although difficulties have occasionally arisen in the ap-

plication of the doctrine. this Court’s cases have provided

a straigntforward test for identifying work product in the

first instance. The definition itself is seemingly capable

of application in every case. Work product is that which

is done tn anticipation of litigation, in preparation of

one’s defense. That definition ts explicit in Rule 26(b) (3)

of the Federal Rules of Civil Procedure. which partially

codifies Hickman’s holding, and thus allows discovery of

work product only in limited circumstances:

iA] party may obtain discovery of documents and

tangible things otherwise discoverable .. . and pre-

pared in anticipation of litigation or for trial by or

for another party or by or for that party’s representa-

tive (inchiding the other party’s attorney. consultant

.. . Or agent) only upon a showing that the party

seeking discovery has substantial need of the mate-

rigls in the preparation of the party’s case and that

the party is unable without undue hardship to obtain

the substantial equivalent of the materials by other

means. In ordering discovery of such materials when

the required showing has been made, the court shall

protect against disclosure of the menial impressions,

conclusions, opinions, or legal theories of an attor-

ney... . (emphasis added )

Fed. R. Civ. P. 26(b)(3). The definition of work prod-

uct—"“things otherwise discoverable . . . prepared in

anticipation of litigation”’—follows directly from the un-

derlying purpose of the rule, which is to allow a case to

be defended and prepared for trial as the litigant believes

12

necessary, without fear that the product of its efforts

will accrue to the benefit of its opponent.

To be sure. work product protection is not absolute.

It can be overcome upon a showing of substantial need by

the party seeking discovery. Upjohn, 449 U.S. at 400-01;

Hickman, 329 U.S. at 511-12; Fed. R. Civ. P. 26(b) (3).

Specifically. ordinary work product—i.e. compiled data,

or “fact work product.” as distinguished from “mental

impressions” “—may be obtained from one’s adversary

upon a showing of “substantial need and inability to

obtain the equivalent without undue hardship.” Upjohn,

449 U.S. at 400; Fed. R. Civ. P. 26(b)(3).° Even then,

disclosure of mental impressions and opinions is to be

avoided.'® But as is implicit in Upjohn, the existence or

nonexistence of mental impressions does not go to whether

the materials are work product, as the court below appar-

ently believed. but instead goes to the degree of protection

afforded to the material.

84 J. Moore et al., Moore’s Federal Practice © 26.64[2] (2d ed.

1993) (‘Material which is appropriately classified as work product

can be divided into two general categories: (1) ‘factual’ work

product, and (2) ‘opinion’ work product, that is material containing

an attorney’s mental impressions, conclusions, opinions or legal

theories’”’).

9 See Hickman, 329 U.S. at 511 (“Where relevant and non-

privileged facts remain hidden in an attorney’s file and where

production of those facts is essential to the preparation of one’s

case, discovery may properly be had”).

10 See Fed. R. Civ. P. 26(b)(3). Opinion work product consists

of attorney memoranda, notes and other work product revealing an

attorney’s mental processes, while ordinary work product encom-

passes the “residue.” In re San Juan Dupont Plaza Hotel Fire

Litig., 859 F.2d 1007, 1014 (1st Cir. 1988). Some courts provide

absolute protection to opinion work product, see Duplan Corp. v.

Moulinage et Retorderie de Chavanoz, 509 F.2d 730 (4th Cir. 1974),

cert. denied, 420 U.S. 997 (1975), while others provide “nearly

absolute immunity,” allowing discovery in “rare and extraordinary

cases.” In re Murphy, 560 F.2d 326, 336 (8th Cir. 1977); see

Upjohn, 449 U.S. at 401-02.

oOo

13

There was no attempt to show hardship or substantial

need in this case.'' Instead, the requirement for such a

showing was pretermitted by the holding of the court

below that inquiry into the efforts of these employees was

permissible because those efforts, and the ¢anclusions

reached through those efforts, were somehow not work

product at all. and that “there is no common law priv-

ilege” barring inquiry into the employees’ methods and

results. App. at 12a. The precise basis for the panel's

conclusion that it could define such efforts as mnon-work

product is difficult to discern.

A. The Second Circuit panel appears to have ap-

proached the issue as if it called for an ad hoc reconcilia-

tion of larger competing interests in determining what

could be protected as work product.’” Such an approach

simply ignores this Court's cases, which have already

drawn the proper balance. Under the cases of this Court,

whether something is work product is determined as a

matter of fact. based upon whether it was prepared in

anticipation of litigation. The only occasion for balanc-

11 Rather than make a showing of need, the government contented

itself with the bold and circular assertion that it needed to obtain

information about these analvses from these witnesses because it

could not obtain information about these analyses from other

sources, and that it needed these analyses because it might “provide

the government with evidence relevant to crimes currently under

investigation.” App. at 29a.

12—Tn approaching both the work product and the attorney-client

issues, the court below saw itself as reconciling two overriding

policies:

Squarely presented for reconciliation are the seemingly con-

flicting interests of disclosure and secrecy. Discovery, designed

to advance the pursuit of truth, takes the ‘sporting’ element

out of litigation by eliminating surprise. The inviolability of

confidential communications between attorney and client and

the protected privacy of the attorneyv’s work product also con-

tribute to the efficient functioning of the adversarial system’s

search for truth.

App. at 3a.

14

ing is in determining whether something that is work

product must nonetheless be divulged on the basis of a

showing of “substantial need” that is absent from the

record in this case.

B. The courts below appear to have been skeptical

about the application of work product protection to the

efforts of litigants on their own behalf, in this case, the

efforts of employees of the corporation being investigated.

That skepticism has no basis. The language of Rule

26(b)(3) makes it clear that work product protection 1s

not limited to the efforts of an attorney, but naturally

covers a litigant’s own efforts. in its own behalf, in antict-

pation of litigation or trial (“prepared in anticipation of

litigation or for trial by . . . another party or by or for

that other party’s representative (including the other

partys ... agent) ...”). Compare App. at Ila (“the

aflidavits ... undercut... the privileged nature of much

of the information as attorney's work product”).

As the language of Rule 26(b)(3) reflects, the policy

underlying the work product immunity could require no

less protection for a party’s own efforts than for those of

its attorney. A party has no less right to prepare its own

defense. enlist the assistance of its employees, and put

its employees at the disposal of outside counsel, than it

does to retaia an outside lawyer to assist in its defense

in the first instance. Where counsel specially retained for

itigation actually directs the gathering of facts and prep-

aration of materials, as here, it only confirms that the

materials have truly been generated in anticipation of

litigation.

C. In applying its approach, the panel ultimately held

that no privilege prevented inquiry into these employee

efforts because it perceived no “judgments,” “estimates”

or “mental impressions” in the results—only “straight-

forward calculations from raw data.” App. at lla. That

approach is in error because it confuses the inquiry about

ee

Wn

“whether something is work product at all” with the

question “whether the work product warrants the special

protections afforded) mental impressions.” '* Compare

Upjohn, 449 U.S. at 399-400. If something does not con-

tain “mental impressions,” that is not dispositive of

Whether it is work product. To the contrary, work product

usually and ordinarily refers to the compilation and col-

lection of facts. See Fed. R. Civ. P. 26(b)(3). Once it

is recognized that the fact-gathering was done in antici-

pation of litigation—as all parties and the courts below

acknowledged throughout—then that process, its product,

and the conclusions drawn from it, are “work product”

protected by Hickman v. Taylor and Rule 26. No work

product of any variety may be discovered by an opponent,

except upon a showing of hardship and substantial need.

By its failure to respect this principle founded in the plain

language of the Rule and in this Court’s decision in Up-

john, 449 U.S. at 399-400. the Second Circuit's decision

is in direct conflict with other circuits that recognize the

protection owing to “fact” or “ordinary” work product, as

well as to “opinion” work product.”

13 Tt is difficult to see how these employees’ conclusions could nof

be regarded as “mental impressions.” The very nature of the task

that these employees were assigned conveys important information

about defense counsel’s theory of the case. See Upjohn, 449 U.S. at

399-400. See generally Sporck v. Peil, 759 F.2d 312, 316 (3d Cir.),

cert. denied, 474 U.S. 903 (1985) (counsel’s selection and compila

tion of documents reveals important aspects of counsel’s under-

standing of the case and is therefore considered to be opinion work

product).

14 See, e.g., In re San Juan Dupont Plaza Hotel Fire Litig., 859

F.2d 1007, 1014 (1st Cir. 1988); Sporel: v. Peil, 759 F.2d 312. 316

(3d Cir. 1985); National Union Fire Ins. Co. v. Murray Sheet Metal

Co., 967 F.2d 980, 983 (4th Cir. 1992); Duplan Corp. v. Moulinaae

et Retorderie de Chavanoz, 509 F.2d 730, 732-33 (4th Cir. 1974):

In re Int'l Sys. & Controls Corp., 693 F.2d 1235, 1239-40 (5th Cir.

1982); Toledo Edison Co. v. G A Technologies, Inc., 847 F.2d 335,

309-40 (6th Cir. 1988); United States v. Leggett & Platt, Inc., 542

F.2d 655, 660 (6th Cir. 1976), cert. denied, 430 U.S. 945 (1977):

In re Chrysler Motors Corp. Overnight Evaluation Program Litig.,

16

D. In holding that fact gathering and analysis by

employees was not work product, the Second Circuit ap-

peared to be moved by the following concern: “[M]erely

by asking witnesses to conduct an analysis defense counsel

may not thereby silence all the key witnesses on the cost

aspects of the Fox contracts under either claim of priv-

ilege.” App. at 10a. The district court’s holding that the

analyses of these employees and their conclusions from

those analyses were “underlying facts” seems to reflect

a similar concern.

But the proper application of the work product rule

does not trigger such concerns. Work product does not

shield the underlying facts from discovery. The work

product doctrine. just as the attorney-client privilege, “puts

the adversary in no worse position than if the communi-

cations had never taken place.” Upjohn, 449 U.S. at 395;

see also Hickman, 329 U.S. at 513. Thus, the govern-

ment was free in this case to ask about what the witnesses

knew before they began their investigations for counsel.

The government was also free to ask the witnesses directly

for their opinions, including their opinions about what

documents might be relevant. Compare App. at 5a. But

it is a different matter entirely to ask the witnesses to

describe the analyses that were done for counsel, the

documents reviewed in connection with that effort, the

information obtained in the course of that effort, and

the conclusions they reached from those efforts. That is

precisely what the government sought here.’? That in-

860 F.2d 844, 846 (8th Cir. 1988) ; In re Murphy, 560 F.2d 326, 329

n.1, 334 (8th Cir. 1977); Admiral Ins. Co. v. United States Dist.

Court, 881 F.2d 1486, 1494 (9th Cir. 1989); In re Sealed Case, 676

F.2d 793, 809-10 (D.C. Cir. 1982); Moore et al., supra note 8.

15Tn the context of this case, where it was established that the

witnesses’ only “analysis” was that performed for counsel, questions

such as “[W]hat analysis did vou perform?,” “What records did

you review?,” and “What conclusions did you draw?” are not ad-

dressed to pre-existing facts, i.e. facts that the witnesses knew prior

to the government’s investigation. Such questions elicit that which

eee

quiry Was improper (absent a showing of a need) be-

cause it sought that which had been created only by

Virtue of the litigation itself.

In contrast with the decision below, other courts have

had little difficulty drawing a clear line between pre-

existing knowledge (which is underlying fact), and knowl-

edge acquired in anticipation of litigation (which is work

product). In Marine Petroleum Co. v. Champlin Pe-

troleum Co., 641 F.2d 984, 987, 988 (D.C. Cir. 1980),

the court thus applied Fed. R. Civ. P. 26(b)(4)(B) to

the work product of an expert who “wore two hats—

that of a general consultant [with knowledge of the under-

lying facts] and that of an expert engaged in preparation

for litigation.” The distinction which the court drew

there was precisely what the work product rule requires:

Plaintiff “could have orthodox discovery of facts known

or opinions held by [the consultant] prior to the time at

which he began to devote his talents to the litigation

but not with respect to information developed thereafter.”

[he information developed for the litigation was pro-

tected. Therefore, on this issue as well the decision of

the court below is in conflict with the approach taken in

other circuits.

In declining to apply the definition of work product

employed by this Court and the Federal Rules, and in

its refusal to afford work product protection to fact work

product created by company employees (rather than

attorneys) in defense of the company. the decision below

creates a work product rule in the Second Circuit that

is in fundamental conflict with the decisions of this Court.

and other circuit courts, applying the clear language of

this Court's cases.

: . * ] . ° . } l af . % yr) 6 oo . ]

was generated for counsel after the Company learned

+ ore 4 . } seaweer fetes . P : ’ »] 7 oON¢ ’

target of the grand jury investigation. See Hickman, 329 U.S

510.

18

Il. THE DECISION BELOW CREATES A SERIES OF

ANOMALIES AND UNDERMINES THE ATTOR-

NEY-CLIENT PRIVILEGE

The decision creates a host of anomalies in the appli-

cation of the work product and attorney-client privileges.

For example, it was conceded by the government that

copies of the written reports prepared by the employee-

witnesses were protected—at least by the attorney-client

privilege. On the other hand, the government argued,

and the courts below held, that the government could

effectively pierce that restriction by simply asking the

witnesses to testify orally about what they had done.

Thus, while the facts gathered, and conclusions drawn,

were deemed protected in their written manifestations,

the intangible work product (that is, tangible work prod-

uct in oral or unwritten form '’) could be freely inquired

into. The anomalies are apparent.

The form of the inquiry and the form of the work

product itself (whether it is in some tangible form, i.e.

a document, or whether it simply resides in the memory

of the witness) should be irrelevant in assessing work

product protection.'' Hickman itself involved a situation

16 See Special Project, The Work Product Doctrine, 68 Cornell L.

Rey. 760, 889 (1983).

17 In the lower courts, the government argued that the work

product privilege “shields only prepared materials” such as “docu-

ments or other tangible things.” App. at 28a.

Although Rule 26(b)(3) pertains to “documents and tangible

things .. . prepared in anticipation of litigation,” courts have held

that work product principles should not be read to imply that

“mental impressions not embodied in documents are otherwise dis-

coverable.” Ford v. Phillips Elecs. Instruments, Co., 82 F.R.D. 359,

360 (E.D. Pa. 1979); see also International Business Machs. Corp.

v. Edelstein, 526 F.2d 37, 41 (2d Cir. 1975); Moore et al., supra

note 8, © 26.64[1] (Hickman is broader than Rule 26). The same

““general policy against invading the privacy of an attorney’s

course of preparation’ of a case” enunciated in Hickman applies

regardless of whether the work product is elicited through oral

testimony or otherwise. Ford, 82 F.R.D. at 360, quoting Hickman,

——

19

where an attorney had been asked to provide a written

description of oral conversations with witnesses. Thus,

he was asked to provide in writing what was, up until

then, merely “intangible’—-his knowledge of conversa-

tions with witnesses. Indeed, Hickman made clear that

certain materials, such as oral conversations with wit-

nesses, could not be inquired into “whether presently in

the form of . . . mental impressions or memoranda.” 329

U.S. at 512. Thus, Hickman indicated that the form of

the material, whether tangible or intangible, was irrele-

vant to its eligibility for the protection of the work

product rule.

For a similar reason, under the approach of the court

below, the protection afforded by the attorney-client

privilege becomes illusory. The court below was careful

to hold that the government could not elicit testimony

about whether these witnesses spoke to the attorney in

reporting on their efforts, or what they said directly to

the attorney."* App. at Ila. The government ought not

be free to avoid the privilege’s protections by substituting

for the clearly impermissible questions, ““What did the at-

329 U.S. at 512; see also Special Project, The Work Product Doc-

trine, 68 Cornell L. Rev. 760, 839-43 (1983) (the “correct result”

is “equal treatment of the oral and written work product’’). In-

deed, it is Hickman that supplies the immunity. The Federal Rules

simply define an exception allowing discovery with respect to the

production of documents. When work product is sought through

testimony rather than through discovery of documents, “fone must

revert to the principles enunciated in Hickman.” Moore et al., supra

- note &, © 2€.64[1] at page 26-349.

18 The attorney-client privilege also protects from disclosure the

substance of the attorney-client communications, including informa-

tion that was learned from counsel. As described in United States

v. Schwimmer, 892 F.2d 237, 244 (2d Cir. 1989), the privilege ap-

plies “regardless of the manner in which it is sought to put the

communications in evidence, whether by direct examination, cross-

examination, or indirectly as by bringing out facts brought to knowl-

edye solely by reason of a confidential communication” (emphasis

in the original).

20

torney teil you?” or “What did you tell the attorney?,”

questions such as “What did you do, learn, and conclude

after your attorney instructed) you to conduct an

analysis?”

The invasion into attorney-client communications and

advice allowed by the lower court’s interpretation of the

work product rule is plain. In order to carry the pro-

ponent’s burden of establishing the basis for a claim of

privilege, the employee-witnesses made clear through

their responses to the Category [ questions that) any

analysis performed had been performed for counsel and

provided to counsel, App. at 27a. See Upjohn, 449 U.S.

at 394, In seeking the analyses and conclusions of these

Witnesses as a result of these studies, the government was

undermining the attorney-client privilege just as surely as

if it had asked directly about what transpired in the at-

torneys’ office.

Il. THE DECISION BELOW PRESENTS A CLEAR

CONFLICT WITH THE PRECEDENTS OF THIS

COURT AND OTHER COURTS OF APPEALS ON

AN IMPORTANT QUESTION OF FEDERAL LAW

The opinion below is not only wrong, but debilitating

in its practical effect on litigation in the federal courts.

That is because the work product doctrine “is an. in-

tensely practical one, grounded in the realities of litigation

in our adversary system. One of those realities is that

attorneys often must rely on the assistance of investiga-

tors and other agents in the compilation of materials in

preparation for trial.” Nobles, 422 U.S. at 238. Because

such assistance is so often necessary, the decision below

will have an immediate and far-reaching effect on the con-

duct of virtually every case involving complex facts. Al-

though the party seeking the work product here was the

eovernment, the rule announced by the court below—

denying work product protection to the efforts of com-

pany enplovees in preparation of a defense—applies by

21

—

its terms to any case now pending or anticipated, whether

pursued by a private litigant or a prosecutor.

Thus, corporate litigants and their attorneys are now

confronted with the dilemma that if they enlist the aid

of their employees in the defense and preparation of the

case, they risk creating a record that may be inimical to

their ultimate interests. At a minimum, they must con

sider whether by engaging in any particular factual in

vestigation, they will thereby be making their adversary’s

task that much easier.

Those attorneys who read the decision below as lim

ited only to the work product efforts of employees, may

resort to outside consultants to develop facts, thus in

creasing the costs of litigation and, more fundamentally

depriving a litigant of its right to participate fully and

knowledgeably in its own defense. On the other hand,

those who elect to curtail their efforts, in deference to the

risk of disclosure created by the decision of the court

below, will be deprived of the full investigation and prep

aration that our adversary system demands. Litigants will

suffer that prejudice to their case without recourse be

cause they cannot appeal an erroneous rule of law with

which they have complied.

Litigants who ignore the decision below will act at their

peril. If their work product is ordered to be disclosed to

their opponent, even they are unlikely to have ready re

course to the courts of appeals, or to this Court, to ad

dress the issue because of the interlocutory nature of

most privilege rulings.

This is therefore a case in which the decision of the

court below is directiy in conflict with the decisions of

this Court and those of other courts of appeals. I[t wil!

(if not reversed now) have an immediate and extraordi

narily far-reaching effect upon a great many cases,

prejudicing many parties, for a long time to come."

19 This case is particularly well-suited for review by this Court

because there are no documents, depositions or other unwieldly

22

CONCLUSION

The petition for Writ of Certiorari should be granted.

Of Counsel:

ARNOLD S. SCHICKLER

VINCENTI & SCHICKLER

Three New York Plaza

New York, NY 10004

(212) 509-9800

JOHN F. KALEY

WEINBERG, KALEY &

PERGAMENT, P.C.

585 Stewart Avenue

Garden City, NY 11530

(516) 222-2323

JAMES O. DRUKER

KASE & DRUKER

1325 Franklin Avenue

Garden City, NY 11530

(516) 746-4300

Respectfully submitted,

CLIFTON S. ELGARTEN *

BRIAN C. ELMER

CARY H. PLAMONDON

PETER J. ROMATOWSKI

CROWELL & MORING

1001 Pennsylvania Ave., N.W.

Washington, D.C. 20004-2595

(202) 624-2500

HERALD PRICE FAHRINGER

LIPSITZ, GREEN, FAHRINGER,

ROLL, SALISBURY & CAMBRIA

110 East 59th Street

New York, NY 10022

(212) 909-9670

Attorneys for Petitioners

* Counsel of Record

discovery materials to review in connection with these claims of

privilege. The specific questions at issue are set forth in the ap-

pendix to the opinion of the court below. The facts are—as the

court below remarked—“straightforward and undisputed.”