The dubious origins and dangers of clawback and quick-peek agreements: an argument against their codification in the Federal Rules of Civil Procedure.
INTRODUCTION
Evidence today is seemingly all electronic. No modern attorney can ignore the unique challenges posed by the digitization of the evidence-gathering process. (1) Consider some statistics, remarkable in their implications for corporate litigators: most companies store up to
Scholars and commentators have urged practitioners to face the realities of dealing with electronic evidence, cautioning that a familiarity with applicable rules and case law is essential for effective representation. (6) Although the Federal Rules of Civil Procedure largely apply to the discovery of electronic information, (7) they are incomplete as to several highly salient issues. (8) Nor is the case law fully satisfactory in providing practitioners with guidance in navigating through the complexities of electronic discovery. An unfortunate result of this lack of direction from Congress and the bench is the rising popularity of clawback and quick-peek agreements, (9) which may save lawyers time, but which may also raise a host of legal and ethical issues.
The pretrial process of privilege review now represents an increasingly weighty part of dealing with electronic evidence. Virtually all discovery now involves staggering volumes of electronic information; (10) attorneys must therefore be cognizant of the risks of unintentionally disclosing a privileged document to the opposing side. An attorney who negligently, or even innocently, allows privileged information to leak to opposing counsel may effect a waiver of his client's privilege. The Manual for Complex Litigation addresses the laborious nature of modern document production and raises a concern shared by practitioners nationwide:
Broad database searches may be necessary, requiring safeguards against exposing confidential or irrelevant data to the opponent's scrutiny. A responding party's screening of vast quantities of unorganized computer data for privilege prior to production can be particularly onerous in those jurisdictions in which inadvertent production of privileged data may constitute a waiver of privilege as to a particular item of information, items related to the relevant issue, or the entire data collection. Fear of the consequences of inadvertent waiver may add cost and delay to the discovery process for all parties. (11)
The California district judge who authored the majority opinion in United States ex rel. Bagley v. TRW, Inc. (12) voiced a similar grievance with the rule that inadvertent disclosure of a privileged document may result in waiver. He lamented that a strict approach to waiver may lead to "socially wasteful behavior, such as the adoption of elaborate and expensive precautions to avoid the inadvertent production of privileged documents, the cost of which may far exceed the social cost of alternative ways of solving the problem." (13) The delay and expense associated with adopting a hyper-careful approach to privilege review, the court reasoned, may be compounded by the necessity of using not only teams of partners and associates to screen for privilege, but also using paralegals and law clerks. (14)
Many lawyers, frustrated with the delays and risks associated with privilege reviews in the electronic age, have taken measures designed to save valuable time and to protect themselves against the consequences of privilege waiver. Parties are increasingly entering into clawback and quick-peek agreements, (15) which denecessitate a traditional privilege review process. (16)
In a clawback arrangement, both parties to a dispute agree in writing that inadvertent production of privileged materials will not automatically constitute a waiver of privilege. (17) If the producing party realizes the disclosure in a reasonable time, he can request the document's return, or "claw it back," and the other party must comply. (18) The requesting party is presumptively barred from using the privileged document to further his client's case. (19)
Instead of authorizing a less thorough review, a quick-peek agreement altogether eliminates the need for an initial privilege review. In this type of arrangement, the requesting party is allowed to see his opponent's entire data set before production. (20) The requester identifies relevant information from his opponent's mass of information. (21) The producing party then extracts privileged information from the now smaller set and turns over his responsive documents and a privilege log. (22) As in a clawback agreement, a quick-peek agreement includes a provision stipulating that production of privileged documents does not waive any privileges. (23) Ken Withers of the Federal Judicial Center notes that, as compared with a clawback, a quick-peek agreement "requires an even higher level of mutual trust and respect between counsel." (24)
Arguments in favor of clawback and quick-peek agreements emphasize their value in shielding lawyers from the oft-harsh consequences of unintentionally disclosing a privileged document during discovery--a practice not uncommon in complex litigation. (25) In response to concerns such as those expressed by the judge in Bagley, the Civil Rules Advisory Committee touts that these agreements "can facilitate prompt and economical discovery by reducing delay before the discovering party obtains access to documents, and reducing the cost and burden of review by the producing party." (26) Professor Rick Marcus offers a utilitarian justification for quick-peek agreements:
Because document requests are often very broad, and the responsive material is therefore often of no real interest to the party seeking production, undertaking the laborious task of reviewing all this material before the other side gets to look at it is highly wasteful if the other side then says it is really interested in only 10% of the material. Wouldn't it be more sensible to postpone the privilege review until the 10% had been identified? That could save the producing party money, and save the party seeking discovery time. (27)
If clawback and quick-peek agreements have the potential to make lawyers' discovery protocols easier and more cost-effective, why does the Sedona Conference admonish that "there are a host of risks and problems that make [these types of] productions impracticable and, for most cases, ill-advised?" (28) This Note will examine why these concededly efficient agreements serve to undermine lawyer professionalism and the common law foundations of privilege jurisprudence. In light of proposed amendments to the Federal Rules of Civil Procedure, which would endorse the formation of clawbacks and quick-peeks, this Note will explain why these two mechanisms, and their codification in the Rules, raise serious issues with respect to common law privilege waiver, ethical duties of lawyers, third-party dangers of entering into a privilege waiver agreement, and judicial authority to modify substantive privilege doctrine.
To provide a backdrop for later analyses of the deficiencies of clawbacks and quick-peeks, Part I will discuss the proposed amendments to the Federal Rules and their formal recognition of the validity of these agreements. Part II, in arguing that clawbacks and quick-peeks defy the common law, will explore various jurisdictions' approaches to privilege waiver and highlight the majority consensus on the importance of thorough privilege reviews. Part III will then discuss the implications of clawback and quickpeek agreements for attorneys' ethical duties of competence and confidentiality. Part IV will address commentators' concerns about the effects of clawbacks or quick-peeks on third parties and in subsequent litigation. Emphasizing courts' lack of authority to give effect to parties' privilege waiver agreements, Part V will question whether the federal judiciary has the power to modify substantive privilege law under the Rules Enabling Act. Finally, Part VI will present solutions for practitioners fearful of inadvertent disclosure that avoid the need to enter into a clawback or quick-peek agreement and better comport with lawyers' obligation of zealous representation.
The Note will conclude by concurring with the Sedona Conference's ominous assessment of clawback and quick-peek agreements: because these devices run contrary to the common law, pose thorny ethical dilemmas, and risk losing their force with other parties or in other fora, they should not substitute for a traditional privilege review even if ultimately condoned in the Federal Rules.
I. PROPOSED AMENDMENTS TO THE FEDERAL RULES OF CIVIL PROCEDURE
The Civil Rules Advisory Committee has come to the stark realization that the Rules need updating to deal with the complexities of electronic discovery. Some of the proposed revisions have generated little comment and may pass through the Supreme Court without controversy. Others may continue to face formidable opposition. Given the authority and ethical issues raised by formally sanctioning clawbacks and quick-peeks, proposed Rule 26 and its related provisions hopefully will remain a source of vigorous debate in the legal community.
The Advisory Committee has conducted various studies and hosted a number of conferences on the idea of amending the Federal Rules to adapt to the electronically sophisticated litigation climate. (29) By 2002, local district and state courts had begun adopting their own electronic discovery rules, the American Bar Association (ABA) and the Sedona Conference had distributed best practices manuals, the Manual for Complex Litigation had been updated to include a section on electronic discovery, hosts of conferences and seminars had been convened to address hot electronic discovery issues, and courts had been weighing in more and more in electronic discovery disputes. (30)
In response to this surge in scholarship, the Advisory Committee disseminated for comment "straw proposals" by leading academics and practitioners. (31) The generated feedback showed a clear need for reform, and the Committee's conference in February 2004 yielded the first set of proposed amendments dealing with electronic discovery. (32) These amendments were published in August 2004 and were open for public comment until February 15, 2005. (33) At its April 2005 meeting, the Advisory Committee synthesized all of the public comments and voted to approve amendments to Rules 16, 26, 33, 34, and 45. (34) On June 16, 2005, the Standing Committee on Rules of Practice and Procedure approved this package of e-discovery amendments. (35) The Judicial Conference unanimously approved the proposals on September 20, 2005, (36) and a Supreme Court determination is expected by the spring of 2006. (37) Congress may then act independently on the amendments if it chooses. (38) The earliest any of the amendments could take effect is December 1, 2006. (39)
A series of proposed rules provides that, if parties can agree to a protocol that allows for document production without a complete privilege review and protects against waiver, a court may enter a case management order implementing their agreement. (40) Proposed Rule 26(b)(5)(B) states:
If information is produced in discovery that is subject to a claim of privilege or protection as trial-preparation material, the party making the claim may notify any party that received the information of the claim and the basis for it. After being notified, a party must promptly return, sequester, or destroy the specified information and any copies it has and may not use or disclose the information until the claim is resolved. (41)
Rule 26(f) was revised to allow parties to agree to a privilege waiver proposal at their planning conference. (42) Amended Form 35 includes a provision whereby parties can report any such agreement to the court, (43) and Rule 16(b) grants courts the authority to enter a case management order implementing the privilege waiver agreement reached by the parties. (44)
Proposed Rule 26(b)(5)(B) would operate to protect lawyers in classic inadvertent waiver situations in which a traditional privilege review is carried out, but one or several documents accidentally slip through the cracks. (45) In addition, the rule clearly gives credence to the clawback approach, allowing parties to retrieve inadvertently disclosed documents after production. (46) Because the drafters did not limit the Rule's application to inadvertent disclosures, proposed 26(b)(5)(B) can be read to authorize quick-peek agreements--which involve the purposeful offering of privileged information--as well. Indeed, the May 2005 Report of the Civil Rules Advisory Committee echoes the 2004 Report in advertising the merits of clawbacks, quick-peeks, and "[o]ther voluntary arrangements [which] may be appropriate depending on the circumstances of each litigation." (47)
Practitioners have expressed concern about the implications of the proposed rule, including its effects of disincentivizing adequate privilege reviews and causing docket-conscious judges to hold attorneys to "unreasonable time frames" with their document production. (48) Although 26(b)(5)(B) and its companion proposals do not require that parties agree to a clawback or quick-peek, or authorize judges to order one absent the parties' agreement, (49) these rules grant lawyers the leeway to experiment with protocols, despite far-reaching negative consequences.
The Advisory Committee clarifies that proposed 26(b)(5)(B) is not intended to settle the matter of whether a privilege is waived when either a classic inadvertent waiver, clawback, or quick-peek situation comes before a court. (50) The drafters emphasize that they are "respecting the special statutory procedures in 28 U.S.C. [section] 2074(b) for adopting rules that modify a privilege." (51) Thus, the rule ostensibly stops short of abrogating the common law of waiver, which would be achieved if the new rule stated that privileges would not be waived in any of the contemplated scenarios. (52)
Despite their assurance that they are not overstepping their rulemaking authority under the Rules Enabling Act, the Advisory Committee is nonetheless standing on shaky ground with the changes to Rule 26(b). Strong doubts remain as to whether the judiciary is foraying into substantive evidentiary law--even by allowing parties to enter into clawbacks and quick-peeks and allowing courts to enforce them, without mandating such agreements or making a definitive determination on privilege waiver. Ken Withers comments on the ongoing controversy about whether the Federal Rules of Civil Procedure are the proper forum for changing the nature of privilege review:
The burden of reviewing vast electronic files for privilege before production was perceived by nearly all commentators as a major one, and nearly all commentators agreed that something needed to be done to provide relief from this perceived burden. The controversy was, and will remain, whether the Federal Rules of Civil Procedure are an appropriate vehicle for addressing this issue, and even if they are deemed to be appropriate, how far civil procedure rules can go to solve a problem that involves aspects of common law, evidence doctrine, and legal ethics. (53)
The following sections of this Note will explore these aspects of clawback and quick-peek agreements before returning to the overarching authority question.
II. COMMON LAW APPROACHES TO PRIVILEGE WAIVER
Courts' rulings on the character of disclosure required to waive an evidentiary privilege have varied, but most courts stress the importance of a diligent privilege review. The strict approach followed by some courts holds that any inadvertent disclosure results in a waiver. (54) A minority of courts favor the lenient approach, whereby a waiver is effected only in cases of deliberate disclosure or extreme negligence. (55) The trend is toward a balancing approach: most modern jurisdictions adopt an intermediate, case-by-case test taking into account (1) the reasonableness of precautions taken to prevent disclosure, (2) the number of inadvertent disclosures, (3) the extent of the disclosure, (4) the remedial measures taken, and (5) considerations of fairness and justice. (56)
A. The Strict Approach
In re Sealed Case typifies the strict approach. (57) Not only had the defendant contractor's chief accounting officer (CAO) disclosed a privileged memorandum to the Defense Contract Audit Agency, but the company's vice president had turned over six privileged documents to the government pursuant to an immunity agreement. (58) In holding that the attorney-client privilege attached to the disclosed documents had been waived, the court reasoned that "[a]lthough the attorney-client privilege is of ancient lineage and continuing importance, the confidentiality of communications covered by the privilege must be jealously guarded by the holder ... lest it be waived. The courts will grant no greater protection to those who assert the privilege than their own precautions warrant." (59) The court found that the disclosure by the defendant's CAO happened only because someone in the company, and therefore the company itself, was careless in providing for the confidentiality of the privileged communications. (60) In an oft-cited passage, the court warned that "if a client wishes to preserve the privilege, it must treat the confidentiality of attorney-client communications like jewels--if not crown jewels." (61) Finally, the court ruled that waiver of the attorney-client privilege extends to all communications relating to the same subject matter. (62)
Advocates of the strict approach to waiver point to its commitment to liberal discovery and its truth-seeking function. (63) More importantly for the profession, the strict approach provides incentives for attorneys to take due care with their clients' documents. (64)
B. The Lenient Approach
In contrast to the strict approach, the lenient view espoused by a minority of courts offers "little incentive for a lawyer to maintain tight control over privileged documents." (65) Although hailed for placing a premium on the attorney-client privilege and for not punishing the client for his lawyer's mistake, (66) the relaxed approach to privilege waiver "ignores the confidentiality aspect of the privilege." (67) Authorities disagree as to which of the two approaches better safeguards the attorney-client privilege. (68)
The Illinois District Court in Mendenhall v. Barber-Greene Co. (69) employed the lenient test in declining to find a waiver by virtue of plaintiffs counsel's inadvertent disclosure of a privileged letter to defendant's counsel. (70) The court opined that waiver can result only from "the 'intentional relinquishment or abandonment of a known right"'--not from an innocent, inadvertent disclosure. (71) More than mere negligence, according to the court, is required to extinguish the attorney-client privilege:
Mendenhall's lawyer ... might well have been negligent in failing to cull the files of the letters before turning over the files. But if we are serious about the attorney-client privilege and its relation to the client's welfare, we should require more than such negligence by counsel before the client can be deemed to have given up the privilege. (72)
A Florida court followed Mendenhall in excusing defendant Ethan Allen's counsel for inadvertently turning over certain privileged transcripts to the plaintiff. (73) The court, in finding no waiver as a result of the disclosure, emphasized that the innocence of the client trumped the negligence on the part of the attorney. (74)
In this regard we agree with the American Bar Association Section of Litigation which advises that: Where the disclosure resulted because of the attorney's negligence and not that of the client, the client's privilege has not necessarily been relinquished. The more modern rationale, therefore, is that the negligence-free client, whose privilege it is in all events, should not bear the burden of global loss of an expectation of confidentiality because of the attorney's negligence in protecting that confidentiality. (75)
Courts favoring the lenient approach, then, would seem to care more about preserving client rights than promoting attorney ethics.
C. The Balancing Approach
The balancing approach utilized by a growing number of courts served to exonerate the defendant company's counsel for the inadvertent disclosure of eighteen privileged documents in In re Grand Jury Investigation. (76) In applying a multifactor balancing test, the court first examined the reasonableness of the precautions taken by defense counsel. (77) The company and its counsel underwent several layers of review in screening for privilege, involving paralegals, junior and senior associates, and inside and outside counsel; the defendant's precautions, therefore, were deemed reasonable. (78) The court also found that the ratio of privileged documents disclosed (18) to the total number of documents reviewed (300,000) did not suggest inadequate precautions. (79) Nor was the extent of the disclosure grave. Although documents were handed over to the government, they had not been viewed by the grand jury or any witnesses or experts--they had not "worked their way into the fabric of the case" so as to destroy meaningful confidentiality. (80) In inquiring as to whether the defendant took immediate action to remedy the disclosure before the other side had relied on the material to develop its case, the court found that the company used reasonable diligence in promptly contacting the government's counsel. (81) Finally, the court found that, because the government had not yet significantly relied on the disclosed information, justice did not require a finding of waiver. (82)
By probing the adequacy of a party's privilege review processes, the balancing approach joins the strict approach in offering "powerful incentives for attorneys to exercise the utmost care and professionalism when screening documents." (83) Although the intermediate standard is more flexible than the per se approaches, and more sympathetic to the equities in complex electronic discovery disputes, it still places heavy emphasis on the performance of a thorough privilege review. Courts adhering to the balancing approach do not hesitate to find waiver when a lawyer has handled his client's confidences in a manner unbefitting a zealous advocate.
In Ciba-Geigy Corp. v. Sandoz, Ltd., (84) the New Jersey District Court entered a protective order providing that an inadvertent disclosure by either party would not result in a waiver as to that disclosure. (85) The court rejected the proposal by plaintiffs counsel to honor a blanket disclosure order, "insist[ing] that any such provision would not excuse the parties from conducting a privilege review prior to the production of documents, in accordance with controlling case law." (86) Defendant's counsel, without conducting a privilege review, produced a copy of an internal company memorandum to plaintiffs counsel on two separate occasions. (87) The court had little difficulty finding a waiver here, given the small scope of documents produced, the lack of time constraints, the failure to conduct any privilege review, the completeness of the disclosure, the inadequacy of measures taken to rectify the error, and the interests of justice in penalizing a party's negligence. (88) The same court in Koch Materials Co. v. Shore Slurry Seals, Inc. (89) refused to enforce the parties' informal blanket agreement protecting against inadvertent waiver. (90) The court asserted that "such blanket provisions, essentially immunizing attorneys from negligent handling of documents, could lead to sloppy attorney review and improper disclosure which could jeopardize clients' cases." (91)
Clawback and quick-peek agreements conceivably would be appropriate discovery devices under a lenient regime, in which even a knowing disclosure of privileged information would not constitute waiver. They are antithetical, however, to the tenets underlying the strict and balancing approaches; (92) the latter has gained the allegiance of most American jurisdictions. (93) The majority of courts place much importance on the thoroughness of a party's privilege review processes; the use of clawbacks and quick-peeks effectively ignores the common law evolution of privilege law.
III. ETHICAL IMPLICATIONS OF CLAWBACKS AND QUICK-PEEKS
A lawyer who agrees to a clawback or quick-peek agreement should worry about more than the law of evidence and courts' attitudes toward privilege waiver. His conduct in handling client confidences also will be measured against the rules of professional conduct, which "impose discipline for negligent or reckless behavior on the part of lawyers." (94) Substantial overlap exists between these rules and the law of evidence:
The way the court rules on matters of inadvertent disclosure of privileged material under the rules of evidence influences whether the attorney can be sanctioned under the professional rules of conduct for breach of confidentiality.... [S]ome of the justifications for the inadvertent disclosure rules rest upon notions of professionalism that are outlined in the rules of professional responsibility. (95)
Voluntarily entering into a clawback or quick-peek agreement runs the risk of violating the Model Rules of Professional Conduct. (96) For example, ABA Model Rule 1.1 states that "[a] lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness and preparation reasonably necessary for the representation." (97) The Rule's comment explains that "[c]ompetent handling of a particular matter includes ... use of methods and procedures meeting the standards of competent practitioners. It also includes adequate preparation. The required attention and preparation are determined in part by what is at stake...." (98) At stake in clawback and quick-peek arrangements, which discourage a thorough privilege review, are the possibilities of waiving a client's privilege and materially damaging his case.
In addition, ABA Model Rule 1.6 orders that "[a] lawyer shall not reveal information relating to the representation of a client...." (99) The rule's comment specifically mandates that a lawyer "act competently to safeguard information relating to the representation of a client against inadvertent or unauthorized disclosure by the lawyer or other persons who are participating in the representation of the client...." (100) Is a lawyer who dodges the privilege review process acting competently to safeguard his client's confidential communications? Opposing counsel is not the only party who may be privy to client confidences in a clawback or quick-peek scenario: there is no guarantee that these communications will not become ammunition for an opponent in later litigation. (101) Evidently recognizing the Rule 1.6 problems posed by clawbacks and quick-peeks, the ABA's proposed civil discovery amendments caution parties to contemplate the potential third-party effects of these agreements. (102)
Applying their ABA Model Rule analogs, state bar disciplinary bodies have analyzed the ethical responsibilities of lawyers in inadvertent disclosure situations. A District of Columbia Bar ethics opinion, primarily addressing the obligations of lawyers who inadvertently receive a disclosed privileged document, expressly warned that a disclosing lawyer may violate his professional duties of competence: "If ... the disclosure occurred because counsel failed to review the documents to be made available to possessing counsel with the thoroughness and preparation required under Rule 1.1(a) or the skill and care required under Rule 1.1(b), the inadvertence could be an ethical violation." (103) This opinion, although not speaking specifically to clawback and quick-peek agreements, contemplates ethical sanctions for lawyers who shirk their duty to perform a thorough privilege review.
A Kentucky Bar ethics opinion also forecasted sanctions for the disclosing lawyer. (104) The board held that "[w]hether or not the sending lawyer's inadvertence and possible violation of Rule 1.6 can waive a privilege presents a question of law." (105) Significantly, although the board declined to offer an opinion on the waiver issue, it recognized that professional liability could attach to the disclosing lawyer's conduct. Given the ABA's reservations about some of the consequences of clawbacks and quick-peeks, and state bars' seeming distaste for protocols which foreclose a traditional privilege review, a lawyer who enters into a clawback or quick-peek scheme could invite two or more ethical breaches--even if his conduct is blessed by the Federal Rules of Civil Procedure.
IV. THIRD-PARTY AND RESIDUAL DANGERS OF CLAWBACKS AND QUICK-PEEKS
Parties to a clawback or quick-peek agreement also risk not having their agreement enforced vis-a-vis third parties in later litigation. In addition, it is virtually impossible for the receiving lawyer in such an arrangement to erase from memory the privileged material that he has glimpsed. A clawback or quick-peek, despite all its protective clauses, simply cannot guarantee against privilege waiver in other litigation contexts or against strategic use of the privileged information by opposing counsel in the case covered by the agreement.
Case law on the issue is thin, but commentators have offered warnings about the third-party effects of clawbacks and quick peeks and about their possible inapplicability in other suits. (106) Some courts have rejected parties' claims of privilege pursuant to protective agreements from prior litigation. In Genentech, Inc. v. U.S. International Trade Commission, (107) the plaintiff inadvertently disclosed 12,000 pages of privileged documents in a multi-district patent infringement suit. (108) After the district judge held that privilege as to those documents had been waived, the administrative law judge (ALJ) presiding over another patent suit involving Genentech and different defendants ruled that the privilege waiver extended to that proceeding. (109) Genentech argued that no general waiver applied to the second case because the parties to the district court case had been subject to a protective order. (110) Because the appeals court determined that Genentech had failed to use adequate screening procedures to review for privilege in the first action, the ALJ's finding of waiver in the second proceeding was sustained. (111)
In Navajo Nation v. Peabody Holding Co., (112) the court held that the production provisions of a confidentiality agreement governing the first action brought by the Navajo Nation did not apply to defendant's privileged documents, which were made part of the public record in the prior action and used in oral argument. (113) The court upbraided the defendant for its strategic use of disclosures: "[P]arties should not be permitted to disclose documents for tactical purposes in one context, and then claim attorney-client privilege in another context." (114)
Regardless of whether a subsequent court decides to enforce a clawback or quick-peek agreement, the fact remains that the receiving attorney has been exposed to privileged information and may still be able to use it to further his client's case. (115) Even if that attorney does not formally seek to enter an inadvertently disclosed document into evidence, he can use the information contained therein as a springboard to related documents or testimony. In effect, the disclosing lawyer may assist his opponent in developing the latter's trial plan.
V. AUTHORITY TO MODIFY PRIVILEGES UNDER THE RULES ENABLING ACT
This Note has shown the judicially recognized risks inherent in clawback and quick-peek agreements, and it expresses the hope that the bench and bar will lobby against their inclusion in the amended Federal Rules of Civil Procedure. A critical question remains: does the federal judiciary have the power to codify these protocols in the Rules, and thereby tinker with the law of privilege waiver? Academia has no ready answer. By examining the Rules Enabling Act, the history of rulemaking, and views on the propriety of judicial modification of substantive rights, this Note will posit that only an affirmative act of Congress could give credence to clawbacks and quick-peeks, given their implications for privilege law.
The Rules Enabling Act lays out procedures for the transmission of proposed federal rules to Congress, vesting rulemaking authority in the judiciary. (116) The second part of 28 U.S.C. [section] 2074 provides, however, that "[a]ny such rule creating, abolishing, or modifying an evidentiary privilege shall have no force or effect unless approved by Act of Congress." (117) In addition, 28 U.S.C. [section] 2072(b) states that the rules prescribed by the Supreme Court "shall not abridge, enlarge or modify any substantive right." (118) Congress, therefore, twice emphasized that the judiciary lacks the power to rework substantive evidentiary privileges. A Federal Rule of Civil Procedure giving a green light to the use of clawbacks and quick-peeks constitutes a modification of the contours of privilege law and a usurpation of congressional authority.
No cases have directly addressed the issue of whether a rule such as proposed Rule 26(b)(5)(B) oversteps the scope of the judiciary's rulemaking authority. (119) In fact, the only authority which the Advisory Committee cites is a Texas Rule of Civil Procedure containing parallel language. (120) Several public comments to the proposed rules, however, express concerns about 26(b)(6)(B) contravening the Rules Enabling Act. (121)
Case law on the substance-versus-procedure issue complicating decisions under the Rules Enabling Act is minimally useful in determining whether the proposed Rule 26(b)(5)(B) really modifies a substantive right. In Hanna v. Plumer, (122) the Supreme Court found that Federal Rule of Civil Procedure 4(d)(1) (regarding service of process in diversity actions) did not exceed Congress' mandate under the Rules Enabling Act. (123) Prescribing the method by which a defendant is alerted that an action has been filed against him sufficiently relates to rules of practice and procedure. (124) "The test must be whether a rule really regulates procedure[]--the judicial process for enforcing rights and duties recognized by substantive law and for justly administering remedy and redress for disregard or infraction of them." (125)
The Court conceded that most changes to rules of practice and procedure affect the rights of litigants, but "Congress' prohibition of any alteration of substantive rights of litigants was obviously not addressed to such incidental effects as necessarily attend the adoption of the prescribed new rules of procedure upon the rights of litigants...." (126) The Hanna Court could not have contemplated the impact of a change in privilege waiver law, as embodied in a proposed Federal Rule authorizing clawbacks and quick-peeks. It is difficult to see how eroding the sanctity of privileges, compromising lawyers' professional duties, and prejudicing clients' cases can be deemed "incidental effects."
Another key Rules Enabling Act case, ICG Communications, Inc. v. Allegiance Telecom, (127) held that the court could compel discovery under Federal Rule 26(c) despite the Telecommunications Act's prohibition against turning over confidential customer information "except as required by law." (128) The court stated that the Federal Rules of Civil Procedure have the effect of law, and essentially bear the imprimatur of Congress. (129) Ultimately the court found that, despite the defendant's contention that compelling discovery in violation of the privacy provisions of the Telecommunications Act would abridge a substantive right, the "except as required by law" stipulation in the Telecommunications Act included court-ordered discovery under the Federal Rules. (130) In the context of proposed Rule 26(b)(5)(B), by contrast, there is no legislatively created exception to which the judiciary may cite allowing it to flout Congress's express reservation of power to modify substantive rights.
The history of federal rulemaking is only slightly more instructive about the proper roles of the judiciary and Congress in dealing with evidentiary privileges. Federal Rule of Evidence 501 sprang from Congress's rejection of an attempt to codify various privileges and left privilege law in the hands of common law courts. The rule provides:
Except as otherwise required by the Constitution of the United States or provided by Act of Congress or in rules prescribed by the Supreme Court pursuant to statutory authority, the privilege of a witness, person, government, State, or political subdivision thereof shall be governed by the principles of the common law as they may be interpreted by the courts of the United States in the light of reason and experience. (131)
As to why Congress in 1972 refused to allow the inclusion of eight privileges in the Rules of Evidence, Professor Timothy Glynn offers a compelling hypothesis: "[V]arious commentators, members of Congress, and a former Supreme Court Justice expressed concern that the proposed privilege rules--and the governing state and federal standards that they were designed to replace--were substantive in nature." (132) Glynn notes that critics of the proposed Rule 501 argued that evidentiary privileges "reflected substantive policy judgments regarding and regulating certain relationships." (133)
Therefore, the argument continued, unlike other types of evidentiary rules designed merely to facilitate reliability in the fact-finding process, the proposed Article V rules could not be viewed as procedural in nature. Thus, according to the critics, evidentiary privileges were not appropriate subjects for judicial rule making under the Rules Enabling Act because judicially-crafted rules may not "abridge, enlarge, or modify any substantive right." (134)
Glynn concludes: "Congress ultimately decided that, if codified privilege rules were to be adopted for the federal courts, it, rather than the judiciary, should adopt them." (135)
After the generic version of Rule 501 was passed, Congress amended the Rules Enabling Act to prescribe procedures for effecting future changes to the Federal Rules through the rulemaking process. (136) Reflecting "Congress's continuing view that any codification of evidentiary privileges is Congress's own prerogative rather than that of the Supreme Court," Congress made a special exception for privileges. (137) Congress has largely removed itself from the privilege realm since Rule 501's passage, leaving the actual development of privilege doctrine to the Supreme Court and lower federal courts. (138)
There has been a general movement away from judicial rulemaking in recent years which has affected commentators' views of the judiciary's involvement in privilege rulemaking. Professor Robert Bone explains:
The professional romance with court rulemaking and the Federal Rules began to sour in the early 1970s. Critics attacked the notion that there was an ideal procedure embedded in existing practice and codified in the Federal Rules. As a result, the boundary between procedure and substance blurred, and the case for expert rulemaking weakened. (139)
As a result of the civil rights, environmental, and consumer protection movements, which catalyzed the creation of a host of new substantive rights, a shift toward a legislative rulemaking paradigm occurred. (140) The new focus was on interest group competition, greater political involvement, and accountability in rulemaking. (141) In the mid-1990s, after the House of Representatives considered several bills aimed at making substantial changes to federal procedure as part of its "Contract with America," the judiciary witnessed Congress's increased interest in rulemaking. (142) Critics of traditional judicial rulemaking, although recognizing the legitimacy of the judiciary's power to create procedural rules under the Rules Enabling Act, have called for greater congressional involvement in rulemaking, including revised rulemaking procedures. (143)
In response to the academic debate over rulemaking in recent years, courts and scholars have considered the controversy as applied to evidentiary privilege law. Although conceding that privileges have both procedural (144) and substantive (145) elements, Raymond Miller argues that privileges have predominantly procedural implications because they control what types of evidence can be introduced at trial. (146) According to Miller, "[p]rivileges have a more significant effect on the function of the judicial system than on the creation of beneficial relationships." (147)
Miller and other proponents of judicial rulemaking are provincial in their focus on the procedural impacts of privileges, namely the exclusion of certain evidence in court. (148) Although giving superficial mention to the substantive aspects of privileges, they effectively ignore the complexities and societal underpinnings of privilege law. The Third Circuit even espoused the view that Congress is better equipped to modify privilege law: "Congress, through its legislative mechanisms, is ... better suited for the task of defining the scope of any prospective privilege. Congress is able to consider, for example, society's moral, sociological, economic, religious and other values without being confined to the evidentiary record in any particular case." (149)
Congressional action is especially necessary and appropriate for a rule that would substantially modify the scope of not one, but all of the evidentiary privileges. (150) Although this Note has focused on clawbacks' and quick-peeks' effects on the functioning of the attorney-client privilege, data disclosed to opposing counsel absent a thorough privilege review may contain information protected by a work-product, priest-penitent, psychotherapist-patient, husband-wife, state secrets, or other privilege. What the Federal Rules of Civil Procedure are trying to do through proposed Rule 26(b)(5)(B), even though the language is not mandatory, is to abridge all of these privileges by endorsing protocols that defy the common law of privilege waiver, allow opposing parties to exploit privileged disclosures, and risk waiving clients' privileges vis-a-vis third parties. Clawbacks and quick-peeks narrow the scope of the protection provided by evidentiary privileges. Although that effect is arguably salutary in terms of enhancing the search for truth in litigation, Congress is the proper branch to decide the issue.
VI. ALTERNATIVES TO CLAWBACKS AND QUICK-PEEKS
Proposed Federal Rule of Civil Procedure 26(b)(5)(B) may face further resistance, but it may pass nonetheless. Regardless of whether the new Rules expressly authorize these protocols, lawyers will continue to incorporate clawbacks and quick-peeks in their discovery regimens. This Part will demonstrate that practitioners need not take on the risks and professional liabilities associated with clawback and quick-peek agreements in order to moderate the discovery burden (151) and guard against privilege waiver.
Attorneys should first look to provisions in the Federal Rules of Civil Procedure that can limit the scope of discovery and reduce the risk of inadvertent disclosures. (152) Rule 26(b)(1) permits discovery of only nonprivileged materials that are "relevant to the claim or defense of any party." (153) Although the relevance standard for discovery is more relaxed than that for the admissibility of evidence at trial, the relevance requirement can eliminate review of large amounts of information. In addition, Rule 26(b)(2) allows courts to limit the scope of discovery for reasons of duplication or undue burden and expense:
The frequency or extent of use of the discovery methods otherwise permitted under these rules and by any local rule shall be limited by the court if it determines that: (i) the discovery sought is unreasonably cumulative or duplicative, or is obtainable from some other source that is more convenient, less burdensome, or less expensive; (ii) the party seeking discovery has had ample opportunity by discovery in the action to obtain the information sought; or (iii) the burden or expense of the proposed discovery outweighs its likely benefit, taking into account the needs of the case, the amount in controversy, the parties' resources, the importance of the issues at stake in the litigation, and the importance of the proposed discovery in resolving the issues. (154)
This provision is especially helpful in litigation involving high volumes of electronically stored information. For example, a party may be exempted from undergoing tedious processes to render certain computerized data into readable form when the same information is available in hard copy or from another source.
Parties can use numerous techniques to minimize the risks of unintentional disclosure without having to rely on the subjective determination of a court. Having a well-organized review and production system in place, ensuring a final review of the production set before shipping it to opposing counsel, and working closely with electronic discovery consultants and experts are essential practices in digital evidence cases. (155) Parties should also take advantage of new technologies to segregate potentially privileged information for review, (156) and limit review to relevant text or a certain time frame or data type. (157) Computer forensics expert Joan Feldman urges parties to avoid the use of office computers to store, index, and manipulate evidence. (158) When dealing with experts and third-party consultants, Feldman cautions that parties should only entrust them with evidence after signing a written agreement with confidentiality and chain of custody provisions. (159)
An increasingly popular case management technique is the use of neutral experts to collect all of a party's requested information, compile it onto CD-ROMs, and remit the information to the party for privilege review. (160) The privilege review process then becomes markedly more manageable. Computer forensics experts can be enlisted also in the document review process to perform sophisticated functions such as text searching, filtering, and sorting data for review. (161) These experts can be extremely helpful in minimizing the amount of data reviewed (162) and ensuring that privileged information is not inadvertently disclosed. (163)
An expert may take the form of a special master as authorized by Federal Rule of Civil Procedure 53. (164) The Rule allows courts to appoint a master to "perform duties consented to by the parties" or to "address pretrial ... matters that cannot be addressed effectively and timely by an available district judge or magistrate judge of the district." (165) In Antioch Co. v. Scrapbook Borders, Inc., (166) the court granted the plaintiffs' motion to appoint a computer forensics expert to retrieve stored data from one of the defendant's hard drives. (167) Determining that the hard drive contained potentially relevant information that was being lost through normal use of the computer, the court laid out a procedure whereby the expert would investigate, copy, and image the data stored on the hard drive. (168)
The court in Playboy Enterprises v. Welles (169) outlined a similar protocol permitting a computer expert to retrieve deleted e-mails from the defendant's hard drive. (170) The expert was directed to create a mirror image of the drive, sign a protective order, and act as an officer of the court. (171) The protective order provided that the expert's exposure to privileged information would not waive the defendant's privilege rights:
To the extent the computer specialist has direct or indirect access to information protected by the attorney-client privilege, such "disclosure" will not result in a waiver of the attorney-client privilege. Plaintiff herein, by requesting this discovery, is barred from asserting in this litigation that any such disclosure to the Court designated expert constitutes any waiver by Defendant of any attorney-client privilege. (172)
Finally, the Sedona Conference, hostile to clawbacks and quick-peeks, condones the use of case management orders providing that an inadvertent disclosure will not effect a waiver of privilege. (173) The court in In re Bridgestone/Firestone, Inc. Tires Products Liability Litigation, (174) a multidistrict consolidated class action, entered a comprehensive case management order containing an exemplary privilege waiver provision:
In the event that a privileged document is inadvertently produced by any party to this proceeding, the party may request that the document be returned. In the event that such a request is made, all parties to the litigation and their counsel shall promptly return all copies of the document in their possession, custody, or control to the producing party and shall not retain or make any [copies]. Such inadvertent disclosure of a privileged document shall not be deemed a waiver with respect to that document or other documents involving similar subject matter. (175)
These protective orders still require a traditional privilege review, and "should not be used to force parties to relinquish privilege rights." (176)
CONCLUSION
Clawbacks and quick-peeks disobey decades of common law privilege jurisprudence, tempt lawyers to violate their ethical duties, and can easily lose their force in third-party contexts. They should not be codified in the Federal Rules given these deficiencies and the judiciary's questionable authority to modify the functioning of evidentiary privileges. If enacted, Rule 26(b)(5)(B) need not steer courts and parties. Rather than compromising their professionalism by experimenting with risky protocols, lawyers are urged to adopt both traditional and high-tech measures to lessen the burden of document review and guard against privilege waiver.
Hiring computer forensics specialists and putting resources into accessing obscure "metadata" may sound daunting, or even cost prohibitive; however, experts are becoming indispensable in modern complex litigation, and their streamlined processes save valuable time and money. With their assistance, privilege review becomes a much lighter chore. In more routine cases in which discovery may largely involve paper documents, the traditional rules are triggered to limit the scope of production.
Clawbacks and quick-peeks present an enticing way of doing things. The arguably minimal time and expense that they save are simply not worth it when alternatives abound. The workability of the Federal Rules of Civil Procedure up to this point, and the advent of experts devoted to simplifying the discovery process, signal that electronic document review can proceed quite effectively without resorting to tactics corrosive to the legal profession, the attorney-client relationship, and the integrity of the Rules Enabling Act.
(1.) See MICHELE C.S. LANGE & KRISTIN M. NIMSGER, ELECTRONIC EVIDENCE AND DISCOVERY: WHAT EVERY LAWYER SHOULD KNOW 2 (2004) (explaining that the "electronic evidence explosion" affects virtually every lawyer, in every practice area, in every case).
(2.) Id. One author sets the figure even higher, projecting that many companies store as much as ninety to ninety-five percent of their records electronically. Robert Douglas Brownstone, Collaborative Navigation of the Stormy e-Discovery Seas, 10 RICH. J.L. & TECH. 53, [paragraph] 6 (2004), http://law.richmond.edu/jolt/v10i5/article53.pdf.
(3.) MANUAL FOR COMPLEX LITIGATION [section] 11.446, at 86 (annotated by DAVID F. HERR (4th ed. 2004)).
(4.) JOAN E. FELDMAN, ESSENTIALS OF ELECTRONIC DISCOVERY: FINDING AND USING CYBER EVIDENCE 1-2 (2003). Feldman notes that, in fact, many banks and insurance companies, in addition to manufacturing, service, and retail sales businesses, store records exclusively in electronic form. Id.
(5.) Stephen E. Noona, The Discovery and Introduction of Electronic Evidence in Federal Court, in VIRGINIA CLE, THE NUTS AND BOLTS OF ELECTRONIC DISCOVERY III-1 (2003). Further illustrating the extent to which e-mail has overtaken commerce, Microsoft's computer network now receives 250 to 300 million messages per month from outside the company. Letter from Thomas W. Burt, Vice President and Deputy Gen. Counsel, Microsoft Corp., to the Comm. on Rules of Practice and Procedure, Judicial Conference of the United States 1 (Dec. 16, 2004) [hereinafter Microsoft Letter], available at http://www.uscourts. gov/rules/e-discovery/04-CV-001.pdf. Internal messages alone average sixty to ninety million per month. Id.
(6.) See FELDMAN, supra note 4, at 1-2 ("[P]ractitioners who limit their search to paper discovery have the potential for missing out on vast amounts of crucial information."); LANGE & NIMSGER, supra note 1, at 4 ("In order to discharge their duties to clients, lawyers practicing in the 21st century must now be prepared to handle this modern form of evidence, along with all the new and unique technical and legal issues that come along with it.").
(7.) See MANUAL FOR COMPLEX LITIGATION, supra note 3, [section] 11.446, at 87 (noting that electronic data that is relevant and non-privileged is routinely discoverable under Federal Rules 26 and 34); Noona, supra note 5, at III-3 (noting that electronic information is discoverable under the Federal Rules of Civil Procedure and is encompassed by the traditional relevance and privilege rules).
(8.) In addition to privilege waiver, discussed infra Part I, the drafters of the proposed amendments to the Federal Rules of Civil Procedure saw an acute need to codify rules addressing early attention to electronic discovery issues, such as the form of production required for electronic data, the discovery of electronic information not reasonably accessible, and sanctions for spoliation of electronic evidence. REPORT OF THE CIVIL RULES ADVISORY COMMITTEE 2-6 (2004) [hereinafter REPORT], available at http://www.krollontrack.com/publications/publiccomment.pdf.
(9.) Clawback and quick-peek agreements are protocols which allow attorneys to economize their privilege reviews and to produce privileged documents to opposing counsel with impunity.
(10.) MANUAL FOR COMPLEX LITIGATION, supra note 3, [section] 11.446, at 86; see also LANGE & NIMSGER, supra note 1, at 48 ("Any lawyer who has engaged in large scale document review understands that the task of reviewing every single piece of paper to determine whether it contains privilege is Herculean."); REPORT, supra note 8, at 8 ("The volume of [electronic] information and the informality of certain kinds of electronic communications, such as emails, make privilege review more difficult, time-consuming, and expensive.").
(11.) MANUAL FOR COMPLEX LITIGATION, supra note 3, [section] 11.446, at 89.
(12.) 204 F.R.D. 170 (C.D. Cal. 2001).
(13.) Id. at 177 n.10.
(14.) Id.; see also LANGE & NIMSGER, supra note 1, at 48 (observing that, in reviewing tens of thousands, or millions, of documents, paralegals, attorneys, and other reviewers may have differing judgment with regard to whether documents warrant privileged status).
(15.) Zubulake v. UBS Warburg LLC, 216 F.R.D. 280, 290 (S.D.N.Y. 2003) ("[M]any parties to document-intensive litigation enter into so-called 'claw-back' agreements...."); THE SEDONA CONFERENCE, THE SEDONA PRINCIPLES: BEST PRACTICES RECOMMENDATIONS & PRINCIPLES FOR ADDRESSING ELECTRONIC DOCUMENT PRODUCTION 37 (2004), available at http://www.thesedonaconference.org/content/miscFiles/ SedondaPrinciples200401.pdf ("Given the enormous volume of electronic documents generated and retained in today's business environment, and in light of the demands of litigation, there is an increasing interest in production subject to so-called 'clawback' agreements."). The Sedona Conference, a research institution at the forefront of electronic discovery policymaking, treats clawbacks and quick-peeks as essentially the same. Id. After drawing a definitional distinction between the two types of agreements, this Note will apply the same analysis to both.
(16.) REPORT, supra note 8, at 8-9 (explaining that clawbacks and quick-peeks permit production without an exhaustive initial privilege review and with an agreement that production of privileged documents does not waive any privileges).
(17.) Kenneth J. Withers, Electronic Discovery Disputes: Decisional Guidance, CML ACTION (Nat'l Ctr. for State Courts, Williamsburg, Va.), Summer 2004, at 4-5, available at http://www.ncsconline.org/Projects_Initiatives/Images/ CivilActionSummer04.pdf. If the other side receives a document that is obviously privileged, it must notify opposing counsel or remit the document to the court. Id.
(18.) Id.
(19.) Whitney Adams & Mark Tuohey, Clawback Agreements Help Protect Privileged Documents, 231 N.Y.L.J. T4 (2004).
(20.) Withers, supra note 17, at 5.
(21.) Id.
(22.) Id.
(23.) REPORT, supra note 8, at 8-9.
(24.) Withers, supra note 17, at 5.
(25.) See id. ("[A]ttorneys will need to manually review tens of thousands (if not millions) of e-mail messages, word-processing documents, and other files to make privilege determinations. Errors are inevitable."); Adams & Tuohey, supra note 19 ('he electronic age has led to a huge increase in company documents, which exponentially increases the risk that, buried within the mountain of files handed over to the other side, some privileged documents will be inadvertently disclosed.").
(26.) REPORT, supra note 8, at 30.
(27.) Memorandum from Professor Rick Marcus to the Advisory Comm. on Civil Rules 26 (Sept. 15, 2003) [hereinafter Marcus Memorandum], available at http://www.kenwithers.com/rulemaking/civilrules/marcus 091503a.pdf. Professor Marcus argues that quick-peeks are especially advantageous when reviewing electronic data:
Discovery regarding electronically-stored materials may involve having one party query its computer system according to directions from the other side. At the time the query is used, the parties don't know what it will elicit, much less whether that might be privileged. So a quick look might be quite helpful in that situation.
Id. at 27.
(28.) THE SEDONA CONFERENCE, supra note 15, at 37.
(29.) Kenneth J. Withers, Two Tiers and a Safe Harbor: The Electronic Discovery Amendments to the Federal Rules of Civil Procedure 3 (Aug. 25, 2004) (unpublished manuscript), available at http://www.krollontrack.com/publications/ twotiers.pdf.
(30.) Id.
(31.) Id. at 4.
(32.) Id. at 4-5.
(33.) Id. at 5.
(34.) Advisory Committee Approves Amendments to Federal Rules of Civil Procedure, http://www.ediscoverylaw.com/cat-federal-rules-amendments-.html (Apr. 21, 2005).
(35.) Standing Committee Approves Proposed Amendments to Federal Rules of Civil Procedure, http://www.ediscoverylaw.com/cat-federal-rules-amendments-.html (June 16, 2005).
(36.) Judicial Conference Approves Proposed Amendments to Federal Rules of Civil Procedure, http://www.ediscoverylaw.com/cat-federal-rules-amendments-.html (Sept. 20, 2005).
(37.) Id.
(38.) Withers, supra note 29, at 6.
(39.) Id.
(40.) REPORT, supra note 8, at 9.
(41.) Proposed FED. R. CIV. P. 26(b)(5)(B), available at http://www.uscourts.gov/rules/Reports/CV5-2005.pdf. The Proposed Amendments to the ABA Civil Discovery Standards also authorize courts to enter orders giving effect to both clawback and quick-peek agreements. See ABA SECTION OF LITIG., ABA CIVIL DISCOVERY STANDARDS 32(b), (d), at 71-72 (Aug. 2004), available at http://www.abanet.org/litigation/discoverystandards/ 2004civildiscoverystandards.pdf. Although the amendments sanction clawbacks and quick-peeks, the comments pinpoint some of the attendant dangers in such agreements. For example, the drafters recognize that "parties using the [quick-peek] approach may know or be fairly certain that privileged material is contained in the mass of data to be extracted." Id.
(42.) Proposed FED. R. CIV. P. 26(f)(4), available at http://www.uscourts.gov/rules/Reports/CV5-2005.pdf. Parties must meet at least twenty-one days prior to their scheduling conference
to develop a proposed discovery plan that indicates the parties' views and proposals concerning ... any issues relating to claims of privilege or protection as trial-preparation material, including--if the parties agree on a procedure to assert such claims after production whether to ask the court to include their agreement in an order...."
Id.
(43.) Proposed FED. R. CIV. P. Form 35, available at http://www.uscourts.gov/rules/Reports/CV5-2005.pdf.
(44.) Proposed FED. R. CIV.P. 16(b)(6), available at http://www.uscourts.gov/rules/Reports/CV5-2005.pdf. The Proposed Rule provides that "the district judge ... shall, after receiving the report from the parties under Rule 26(f) or after consulting with the attorneys for the parties ... enter a scheduling order.... The scheduling order may also include ... any agreements the parties reach for asserting claims of privilege or protection as trial-preparation material after production...." Id.
(45.) Withers, supra note 29, at 2.
(46.) Id. at 25.
(47.) REPORT OF THE CML RULES ADVISORY COMMITTEE 36 (2005), available at http://www.uscourts.gov/rules/Reports/CV5-2005.pdf.
(48.) Mary P. Gallagher, Federal Courts Propose Rules for E-Discovery, N.J.L.J., Sept. 6, 2004; see also Testimony of National Association of Consumer Advocates Before the Standing Committee on Rules of Practice and Procedure, Judicial Conference of the United States 2 (Jan. 28, 2005) [hereinafter Testimony] ("The proposal to amend Rule 26(b)(5)(B) to allow a dilatory assertion of privilege will encourage sloppy initial production and gamesmanship."); Letter from Scott C. Lucas, Attorney, to the Comm. on Rules of Practice and Procedure, Judicial Conference of the United States (Jan. 10, 2005) ("IT]his proposal encourages sloppy discovery practices and penalizes litigants who are proactively preparing their case."); Microsoft Letter, supra note 5, at 23.
[W]e oppose any addition to the Rules that would influence parties to adopt agreements regarding privilege waiver--particularly insofar as such agreements may serve to pressure parties into the premature production of privileged material.... We are also concerned that courts will pressure a litigant who complains of cost to adopt an alternative review approach.
Id.
(49.) REPORT, supra note 8, at 9.
(50.) Id. at 13.
(51.) Id.
(52.) Withers, supra note 29, at 10-11.
(53.) Id. at 23.
(54.) Adams & Tuohey, supra note 19.
(55.) Id.; Douglas L. Lineberry, Inadvertently Disclosed Documents: What Are Your Ethical Obligations?, 14 S.C. LAW. 40, 42 (2003).
(56.) Lineberry, supra note 55, at 42.
(57.) 877 F.2d 976 (D.C. Cir. 1989).
(58.) Id. at 977-78.
(59.) Id. at 980.
(60.) Id.
(61.) Id. The "crown jewels" level of care applies with equal force to the client's attorney, who can cause a waiver of privilege through his negligence in handling client confidences. Id.
(62.) Id. at 980-81. See also SEC v. Lavin, 111 F.3d 921, 929 (D.C. Cir. 1997) ("In the attorney-client context, this court adheres to a strict rule on waiver of privileges.... [T]he holder [of the privilege] must zealously protect the privileged materials, taking all reasonable steps to prevent their disclosure."). Other courts have echoed the unyielding pronouncements of the D.C. Circuit. See, e.g., F.C. Cycles Int'l, Inc. v. Fila Sport, S.p.A., 184 F.R.D. 64, 76 (D. Md. 1998) ("[T]here is more support for the theory that the Fourth Circuit favors the 'strict' ... approach of full waiver upon disclosure--whether inadvertent, voluntary, or implied.").
(63.) Roberta M. Harding, Waiver: A Comprehensive Analysis of a Consequence of Inadvertently Producing Documents Protected by the Attorney-Client Privilege, 42 CATH. V. L. REV. 465, 504 (1993); Joshua Simko, Note, Inadvertent Disclosure, the Attorney-Client Privilege, and Legal Ethics: An Examination and Suggestion for Alaska, 19 ALASKA L. REV. 461, 465 (2002). For a detailed analysis of the merits and flaws of each of the three approaches to privilege waiver, see also Trina Jones, Inadvertent Disclosure of Privileged Information and the Law of Mistake: Using Substantive Legal Principles to Guide Ethical Decision Making, 48 EMORY L.J. 1255, 1273-76 (1999).
(64.) Shawn T. Gaither, The Attorney-Client Privilege: An Analysis of Involuntary Waiver, 48 CLEV. ST. L. REV. 311, 315 (2000). One author notes:
[T]he lawyer's duty of zealous advocacy is perhaps the strongest argument in favor of the strict responsibility approach. It is not the receiving lawyer's responsibility to maintain the attorney-client privilege for his adversary.... If an attorney does not want an adversary to use information she considers confidential, she should take care not to disclose it in the first place.
Simko, supra note 63, at 467.
(65.) Gaither, supra note 64, at 316; Simko, supra note 63, at 471-72 ("If there is no threat of waiver or sanctions, the lawyer has no incentive to protect her client's confidential documents. The result is a license for sloppy management." (footnote omitted)).
(66.) Harding, supra note 63, at 503-04 ("The lenient test upholds the important longstanding attorney-client privilege ... and recognizes that the client, not the attorney, is the proper holder of the privilege." (footnote omitted)).
(67.) Gaither, supra note 64, at 316.
(68.) This Note posits that only a standard which holds lawyers accountable for their carelessness in handling privileged information can truly be said to further the policies behind the attorney-client privilege.
(69.) 531 F. Supp. 951 (N.D. Ill. 1982).
(70.) Id. at 955.
(71.) Id. (quoting Johnson v. Zerlost, 304 U.S. 458, 464 (1938)).
(72.) Id.; see also Helman v. Murry's Steaks, Inc., 728 F. Supp. 1099, 1104 (D. Del. 1990) ("The holder of the privilege is the client. It would fly in the face of the essential purpose of the attorney/client privilege to allow a truly inadvertent disclosure of a privileged communication by counsel to waive the client's privilege.").
(73.) Georgetown Manor, Inc. v. Ethan Allen, Inc., 753 F. Supp. 936 (S.D. Fla. 1991).
(74.) Id. at 939.
(75.) Id. (citing ABA SECTION OF LITIG., THE ATTORNEY-CLIENT PRIVILEGE AND THE WORK-PRODUCT DOCTRINE 66 (2d ed. 1989)).
(76.) 142 F.R.D. 276, 283 (M.D.N.C. 1992).
(77.) Id. at 279. The court took note that "many courts in this circuit and elsewhere have concluded that inadvertent disclosure may constitute a waiver of the privilege where the circumstances of the disclosure reflect gross negligence or a failure to take reasonable precautions to avoid the disclosure." Id.
(78.) Id. at 279-80. The court offered examples of cases involving inadequate precautions: a case in which counsel had ample time to review a single box and still disclosed dozens of privileged documents; a case in which counsel eliminated a review stage that was customarily performed; and a case in which only two people reviewed tens of thousands of documents in a single day. Id. at 280.
(79.) Id. at 281.
(80.) Id.
(81.) Id. at 282.
(82.) Id. There are other illustrations of the balancing approach. See, e.g., United States v. Rigas, 281 F. Supp. 2d 733, 738-42 (S.D.N.Y. 2003) (concluding that government did not waive privilege attaching to paralegal's work product in light of reasonable precautions taken to secure privileged hard drives; of fact that 130 files were disclosed out of hundreds of thousands of paper documents, hundreds of CD-ROMs, and additional hard drives; and of minimal risk of prejudice since defense counsel opted to refrain from viewing files until resolution of discovery dispute); Fleet Bus. Credit Corp. v. Hill City Oil Co., No. 01-02417, 2002 WL 31741282, at *3 (W.D. Tenn. Dec. 5, 2002) (finding no waiver because disclosing party employed adequate screening mechanisms, in which team of three attorneys and one paralegal reviewed and isolated privileged documents; because thirty out of 16,000 documents was an acceptable margin of error; and because disclosing party acted within days to rectify situation).
(83.) Simko, supra note 63, at 475 (footnotes omitted).
(84.) 916 F. Supp. 404 (D.N.J. 1995).
(85.) Id. at 406.
(86.) Id. (emphasis added).
(87.) Id.
(88.) Id. at 412-14.
(89.) 208 F.R.D. 109 (D.N.J. 2002).
(90.) Id. at 118.
(91.) Id.
(92.) THE SEDONA CONFERENCE, supra note 15, at 37 (stating that the tenets of privilege law "usually require the producing party to meticulously guard against the loss of secrecy for [privileged] materials").
(93.) United States v. Gangi, 1 F. Supp. 2d 256, 264 (S.D.N.Y. 1998) ("[T]he prevailing view in this District, as well as in the majority of the Circuits, is that a more flexible, 'middle of the road approach' should be applied."); Adams & Tuohey, supra note 19.
(94.) Simko, supra note 63, at 462.
(95.) Id. at 462-63.
(96.) THE SEDONA CONFERENCE, supra note 15, at 37.
(97.) MODEL RULES OF PROF'L CONDUCT R. 1.1 (2003) (emphasis added).
(98.) MODEL RULES OF PROF'L CONDUCT R. 1.1 cmt. 5 (2003).
(99.) MODEL RULES OF PROF'L CONDUCT R. 1.6 (2003).
(100.) MODEL RULES OF PROF'L CONDUCT R. 1.6 cmt. (2003).
(101.) See infra Part IV.
(102.) ABA SECTION OF LITIG., supra note 41, at 71-72. The text of Civil Discovery Standard 32(b) offers an explicit admonition: "In stipulating to the entry of such an order, the parties should consider the potential impact that production of privileged or protected data may have on the producing party's ability to maintain privilege or work-product protection vis-a-vis third parties not subject to the order." Id. In explaining how to implement a quick-peek agreement, amended rule 32(d)(ii)(B) contains an almost identical caveat: "Before agreeing to this procedure, the producing party should consider the potential impact that it may have on the producing party's ability to maintain privilege or work-product protection attaching to any such data if subsequently demanded by non-parties." Id.
(103.) D.C. Bar, Ethics Op. No. 256 (1995).
(104.) Ky. Bar Ass'n, Ethics Op. No. E-374 (1995).
(105.) Id. (emphasis added).
(106.) ABA SECTION OF LITIG., supra note 41, at 74 ("[I]n current practice, there is no assurance that a stipulated order providing that inadvertent disclosure does not effect a waiver will be effective against a claim of waiver asserted by a third party."); Marcus Memorandum, supra note 27, at 26 ("[O]ne could certainly argue that the parties' agreement cannot ... foreclose arguments by third parties about whether a waiver has occurred whatever the parties intended."); THE SEDONA CONFERENCE, supra note 15, at 37 ("[D]espite the strongest possible language in any 'clawback' or 'quick peek' order ... there is no effective way to limit the arguments of non-parties regarding the legal effect of the production in other jurisdictions and forums."); Timothy P. Glynn, Federalizing Privilege, 52 AM. U. L. REV. 59, 130-31 (2002) ("[E]ven if a party's legal right to claim privilege is not lost upon compelled disclosure, the cat is out of the bag: the confidences are no longer secret, and, in complex litigation, adversaries in later proceedings may have gained the benefit of knowing such confidences...." (footnote omitted)); Gallagher, supra note 48 (noting that a state court not subject to the Federal Rules can easily declare waiver in a state proceeding even if it was not declared in the prior federal action); Withers, supra note 17, at 5 ("[T]he entire arrangement can be viewed as 'privilege waiver' by third parties or in subsequent litigation...."); Withers, supra note 29, at 27 ("[N]o matter what the parties may agree to and the court may bless, a third party or a litigant in a parallel action can easily make the case that the agreement does not bind them, and the parties have consciously waived any [privilege claim] respecting the entire information collection.").
(107.) 122 F.3d 1409 (Fed. Cir. 1997).
(108.) Id. at 1413.
(109.) Id.
(110.) Id. at 1417.
(111.) Id. at 1418.
(112.) 209 F. Supp. 2d 269 (D.D.C. 2002).
(113.) Id. at 284.
(114.) Id. at 286; see also Permian Corp. v. United States, 665 F.2d 1214, 1221 (D.C. Cir. 1981).
The client cannot be permitted to pick and choose among his opponents, waiving the privilege for some and resurrecting the claim of confidentiality to obstruct others, or to invoke the privilege as to communications whose confidentiality he has already compromised for his own benefit.... The attorney-client privilege is not designed for such tactical employment.
Id.
(115.) See LANGE & NIMSGER, supra note 1, at 49 ("You cannot put the toothpaste back into the tube.... You cannot erase that information from the memory or minds of counsel despite a court order to disregard the contents."); Edward C. Bassett, Jr. & James A. Wingfield, Electronic Discovery and the Proposed Amendments to the Federal Rules of Civil Procedure, 7 MASS. BAR ASS'N SEC. REV. 8, 9 (2005) ("[W]hen documents have already been viewed by third parties there is little that can be done to undo the damage or unring the bell."); Gallagher, supra note 48 (addressing the "Pandora's Box" problem).
(116.) 28 U.S.C. [section] 2074(a) (2000).
(117.) Id. [section] 20740)).
(118.) Id. [section] 2072(b).
(119.) Marcus Memorandum, supra note 27, at 24.
(120.) TEX. R. CIV. P. 193.3(d). Texas does not have a statute equivalent to 28 U.S.C. [section] 2074(b). Henry S. Noyes, Is E-Discovery So Different that It Requires New Discovery Rules? An Analysis of Proposed Amendments to the Federal Rules of Civil Procedure, 71 TENN. L. REV. 585, 647 n.293 (2004).
(121.) See, e.g., Noyes, supra note 120, at 647 ("[S]uch amendments [addressing privilege waiver] might be construed as 'creating, abolishing, or modifying an evidentiary privilege' and therefore would not have any effect unless approved by Congress.") (footnote omitted); James E. Rooks, Jr., Will E-Discovery Get Squeezed?, 40 TRIAL 18, 22 (2004) ("[I]f adopted, this amendment would apply to all discovery, not just e-discovery. It would create a new substantive right with regard to privileged material, which is outside the rulemakers' power under the Rules Enabling Act.") (footnote omitted); Testimony, supra note 48, at 6 ("A ... problem exists in that this provision appears to be a substantive change in the law of privilege, which is outside allowable rulemaking powers under the Rules Enabling Act....").
(122.) 380 U.S. 460 (1965).
(123.) Id. at 463-64.
(124.) Id. at 464.
(125.) Id. (quoting Sibbach v. Wilson & Co., 312 U.S. 1, 14 (1941)).
(126.) Id. at 465.
(127.) 211 F.R.D. 610 (N.D. Cal. 2002).
(128.) Id. at 610-11.
(129.) Id. at 613.
(130.) Id. at 614-15.
(131.) FED. R. EVID. 501.
(132.) Glynn, supra note 106, at 88 (footnote omitted).
(133.) Id. at 89.
(134.) Id. (footnotes omitted).
(135.) Id. at 90.
(136.) Id. at 92.
(137.) Id. at 93. An "act of Congress" is more than that body's approval of a proposed set of Federal Rules crafted by the judiciary. After a Federal Rule of Civil Procedure is drafted by the Advisory Committee on Civil Rules and reviewed by the Standing Committee on Rules of Practice and Procedure and the Supreme Court, Congress can only exercise a veto. Robert G. Bone, The Process of Making Process: Court Rulemaking, Democratic Legitimacy, and Procedural Efficacy, 87 GEO. L.J. 887, 892 (1999). Congress agreed to hold negative power with regard to federal rulemaking, except in the area of privilege law.
(138.) Glynn, supra note 106, at 93. Congress's decision to let privilege law evolve in the courts is distinct from allowing the judiciary to codify privilege rules through the rulemaking process.
(139.) Bone, supra note 137, at 900.
(140.) Id. at 900-07.
(141.) Id. at 903-05.
(142.) Id. at 906.
(143.) Id. at 907. Bone explains that critics of judicial rulemaking think that any justification behind a procedural rule requires the weighing of substantive values, and should thus be done by a politically accountable process. Id. at 910; see also Stephen B. Burbank, The Costs of Complexity, 85 MICH. L. REV. 1463, 1473 (1987).
Because avowedly procedural rules may have either substantive purposes or substantive effects, consideration should be given to the political legitimacy of the process by which they are formulated or applied and of the actors who are formulating or applying them. Rather than giving up on the procedure/ substance dichotomy, we should craft it with attention to its ultimately political ramifications.
Id. (footnote omitted). Burbank asserts that the federal judiciary buries its substantive policy choices in the Federal Rules, raising serious concerns about accountability, democratic values, and allocation of power in rulemaking. Id. at 1475. But see Bone, supra note 137, at 954.
The critics are correct in one respect: there is no clear normative divide between procedure and substance. Procedural rules do have substantive effects and require a potentially controversial weighing of substantive values. However, this does not mean, as the critics claim, that a court rulemaking process divorced from political accountability and allowing only limited public participation is necessarily illegitimate.
Id. Robert Bone justifies court rulemaking based on a theory of procedural law and defends the judicial model against challenges to its legitimacy and effectiveness. Id.
(144.) Raymond F. Miller, Comment, Creating Evidentiary Privileges: An Argument for the Judicial Approach, 31 CONN. L. REV. 771, 795 (1999) ("[P]rivileges dictate procedures by which courts administer justice.").
(145.) Id. ("[A] privilege is a substantive law that may impact the nature and type of relationships enjoyed by citizens.").
(146.) Id. at 797.
(147.) Id. at 795.
(148.) Id.
(149.) In re Grand Jury Proceedings, 103 F.3d 1140, 1154-55 (3d Cir. 1997) (footnote omitted).
(150.) See Glynn, supra note 106, at 156 ("Under the Rules Enabling Act, only Congress can codify privilege law for the federal judicial system, and only Congress can implement other holistic changes.... Congressional action, therefore, is needed for any significant national reform addressing privilege law.").
(151.) One of the principal justifications for clawbacks and quick-peeks, of course, is their purported ability to save money and time. Some argue, however, that this rationale is grounded in fiction. Henry Noyes of Pillsbury Winthrop challenges the contention that the involvement of electronic data in a case necessarily translates into increased discovery burdens:
[T]here is nothing unique about electronic information that prevents a party or its attorneys from conducting an appropriate and effective review for privileged communication. On the contrary, in many instances it will be easier to review electronic information to determine the foundational factors that go into an analysis of privilege--who created the information, who edited it, who received the document, and when all of this occurred.
Noyes, supra note 120, at 601-02. Corporate litigator Darren Summerville concurs, noting that "the searchability of electronic records might very well make privilege review easier than a parallel type of review for 'hardcopy' records." Testimony by Darren Summerville, Attorney, Bondurant, Mixson & Elmore, LLP, for Public Hearing on Proposed Amendments to Civil Rules for Electronic Discovery (Jan. 28, 2005). Summerville also argues that anyone reviewing electronic information for responsiveness, "if efficient," conducts a simultaneous privilege review. Id.
These testaments from practitioners who are familiar with the demands of complex litigation cast serious doubts on the entire purpose behind clawback and quick-peek agreements. If there is a possibility that the protocols they endorse do not result in meaningful savings, the proposed privilege waiver rules would only deceive, and subject lawyers to risks not offset by any advantages. This Note assumes marginal efficiency gains from clawback and quick-peek agreements, but invites lawyers to question whether, in their experience, electronic information by its nature mandates uniquely laborious privilege reviews.
(152.) FED. R. CIV. P. 26; Noona, supra note 5, at III-1 to -6.
(153.) FED. R. CIV. P. 26(b)(1).
(154.) FED. R. CIV. P. 26(b)(2).
(155.) LANGE & NIMSGER, supra note 1, at 51.
(156.) Id.
(157.) FELDMAN, supra note 4, at 6-25.
(158.) Id. at 12-4.
(159.) Id. at 12-5.
(160.) Id. at 6-18.
(161.) Id. at 6-21.
(162.) Id. at 6-30.
(163.) Id. at 6-23.
(164.) FED. R. CIV. P. 53; MANUAL FOR COMPLEX LITIGATION, supra note 3, [section] 11.446.
(165.) FED. R. CIV. P. 53(a)(1)(A), (C).
(166.) 210 F.R.D. 645 (D. Minn. 2002).
(167.) Id. at 653.
(168.) Id. at 652-54.
(169.) 60 F. Supp. 2d 1050 (S.D. Cal. 1999).
(170.) Id. at 1051-55.
(171.) Id. at 1054.
(172.) Id. at 1055. For a similar protocol stipulating that "disclosure of a communication to the expert shall not be deemed a waiver of the attorney-client privilege or any other privilege," see Simon Property Group LP v. mySimon, Inc., 194 F.R.D. 639, 642 (S.D. Ind. 2000).
(173.) THE SEDONA CONFERENCE, supra note 15, at 38.
(174.) 129 F. Supp. 2d 1207 (S.D. Ind. 2001).
(175.) Id. at 1219. See also the protective order in Medtronic Sofamor Danek, Inc. v. Michelson, 56 Fed. R. Serv. 3d 1159 (W.D. Tenn. 2003), providing that "Medtronic waives no privilege for documents or subject matter produced through any of the discovery protocols in this order." Id. at 1176. The Medtronic court mandated a thorough privilege review with detailed requirements. Id. at 1172-76.
(176.) Withers, supra note 29, at 27.
Laura Catherine Daniel, I would like to thank Professor Mollie Nichols for her encouragement of this Note topic, Maria Mullarkey and Jeff Mead for their outstanding editing, and my family for their gracious support.
Email this Article
Digg It
del.icio.usRelated Articles
- A millennial update on procedural issues in environmental litigation.
- An update on pleading, sanctions and civil justice reform in environmental cases.
- Comity be damned: the use of antisuit injunctions against the courts of a foreign nation.
- Plain error rule - clarifying plain error analysis under rule 52(b) of the Federal Rules of Criminal Procedure.
- Warren court precedents in the Rehnquist court.
- Harold Maier, comity, and the foreign relations restatement.
- Obtaining discovery abroad: the utility of the comity analysis in determining whether to order production of documents protected by foreign blocking statutes.
- Recognizing foreign tax judgments: an argument for the revocation of the revenue rule.
- eDiscovery: a new approach to discovery in federal and state courts: changes in technology have altered the way lawyers deal with preservation, collection, review, and production of evidence. The electronic-discovery amendments to the Federal Rules of Civil Procedure, effective December 1, 2006, provide a framework for dealing with this new reality.
- Globalization of arbitral procedure.
- Administrative law - First Circuit decides qualified federal law enforcement privilege outweighs state's prerogative to enforce criminal code.
- The vanishing substance-procedure distinction in contemporary corporate litigation: an essay.
- Civil procedure - sufficiency of evidence not reviewable in absence of post-verdict judgment as a matter of law or new trial motion - Unitherm Food Systems, Inc. v. Swift-Eckrich, Inc.