U.S. Supreme Court Holds Order Requiring Disclosure Of Privileged Information Not Immediately Appealable Under Collateral Order Doctrine
April, 2010
by Melinda S. Kollross and Edward M. Kay
In Mohawk Industries, Inc. v. Carpenter¸ 130 S. Ct. 599 (Dec. 8, 2009), the United States Supreme Court considered whether a party may seek review under the collateral order doctrine of a discovery order regarding the disclosure of materials said to be covered by the attorney-client privilege. The collateral order doctrine provides that a party make seek appellate review not only of judgments that “terminate an action,” but also a “small class” of collateral rulings that, although they do not end the litigation, are appropriately deemed “final.” Cohen v. Beneficial Industrial Loan Corp., 337 U. S. 541, 546 (1949). Cohen sets forth a three part test for determining whether a collateral order is entitled to appellate review based upon (1) the conclusiveness of the order, (2) the importance of the issue, and (3) whether the order would be effectively unreviewable if a party was forced to wait until a final judgment was entered. In the first opinion authored by new Supreme Court Justice Sotomayor, the Court held that an order requiring the disclosure of information arguably protected by the attorney–client privilege is not immediately appealable under the collateral order doctrine.
Facts
Mohawk arises from two separate lawsuits. In the first, a group of employees sued Mohawk Industries over an alleged conspiracy to drive down their wages by knowingly hiring lower-paid undocumented workers. The second lawsuit arose from the alleged wrongful termination of another employee, Norman Carpenter. Carpenter complained to Mohawk’s human resources department about the company’s employment of undocumented aliens, and was subsequently terminated after he refused to recant his statements. Carpenter sought the production of information concerning meetings he had with Mohawk’s attorneys following his initial complaint. Mohawk asserted the attorney-client privilege; however, the district court deemed the privilege waived as a result of Mohawk’s representations in the wage suit. Mohawk then sought review under the collateral order doctrine in an attempt to prevent disclosure of the arguably privileged communications. The Eleventh Circuit found the first two Cohen criteria satisfied, but not the third, holding that Mohawk’s position could be vindicated on appeal from a final judgment.
Analysis
The Court recognized the historical importance of the attorney-client privilege, but held that the disclosure of privileged information can be remedied on appeal in the same way that other erroneous evidentiary rulings can be corrected. The Court noted that parties have other ways to avoid the disclosure of arguably privileged information, such as: (1) seeking certification for interlocutory review under 28 U.S.C. 1292(b); (2) seeking a writ of mandamus; (3) ignoring an order, incurring sanctions, and seeking review later; or (4) ignoring an order, suffering a punitive contempt sanction, and immediately appealing the sanctions. In rendering its decision, the Court expressed skepticism that allowing disclosures to go unaddressed until after a final judgment would chill clients’ willingness to speak freely with their attorneys. The Court ultimately concluded that the limited benefits of allowing interlocutory appeals like Mohawk’s would be outweighed by the burden that hearing such appeals would place on the courts.
Learning Point
Mohawk resolves a conflict among the federal Circuit Courts of Appeal concerning the availability of collateral appeals in the attorney-client privilege context. The Third, Ninth and D.C. Circuits had previously permitted collateral order appeals of attorney-client privilege rulings, while the Second, Fifth, Seventh and Tenth Circuits had found such orders non-appealable. Following Mohawk¸ litigants facing forced disclosure of arguably privileged material may still pursue several other potential avenues of immediate review and/or seek a protective order “to limit the spillover effects of disclosing sensitive information.”
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