Monday, March 14, 2005

Fourth Circuit Opinion on the Crime-Fraud Exception and Attorney Work Product

An interesting Fourth Circuit decision on March 11 deals with the crime-fraud exception and discusses the different standards to be applied to attorney opinion work product and fact work product.  The case, In re: Grand Jury Proceedings #5 (opinion here), has few facts beyond noting that the grand jury sought to compel the production of documents and testimony from an attorney in connection with the representation of two individuals and their corporation.  Typical of such cases, the government submitted grand jury information ex parte and in camera describing the alleged crime or fraud perpetrated by the clients and the use of their counsel as part of that crime or fraud -- the opinion contains no hint of what was involved, for good reason.  The Fourth Circuit dealt with two issues.  First, the attorney asserted the work product protection for the documents subpoenaed, and the court had to deal with the issue of how to apply the crime-fraud exception to fact v. opinion work product.  Since Upjohn, courts have been highly resistant to ordering the production of attorney opinion work product, and usually demand a clear showing of attorney involvement in the client's misconduct for an application of the crime-fraud exception to opinion work product; fact work product, however, received lesser protection, essentially on a par with communications protected by the attorney-client privilege.  Distinguishing the two, the Fourth Circuit held:

Because fact work product enjoys less protection than opinion work product, it may be discovered upon prima facie evidence of a crime or fraud as to the client only and thus even when the attorney is unaware of the crime or fraud. While the attorney, along with the client, holds the fact work product privilege, the discovery of facts furnished to an attorney does not implicate the same concerns as does invading the necessary privacy of an attorney’s opinion work product, an invasion only justified if the attorney himself knows of the fraud. We thus use similar standards when applying the crime-fraud exception to attorney-client and fact work product privileges.

The second issue concerned the district court's finding that the crime-fraud exception applied without ever reviewing the communications and work product, and even without a description of the contents of the documents and testimony.  In effect, once the district court found sufficient evidence that the clients were engaged in an ongoing or future crime or fraud, and the attorney was in the vicinity, that was sufficient.  The Fourth Circuit remanded for an actual review of the documents and testimony so that the second step in the analysis -- that the clients consulted with the attorney for the purpose of assisting in the crime or fraud -- could be determined on more than an assumption. 

The crime-fraud exception is difficult for both sides, because it is based on assumptions and conclusions without a complete evidentiary basis and no real adversary testing. That courts some times just cut to the chase ignores how important the process is to protecting the attorney-client privilege and work product protection. (ph)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2005/03/the_crimefraud_.html

Grand Jury, Judicial Opinions, Privileges | Permalink

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