Because of the volumes of information and the complexities of data found in many cases that require extensive electronic discovery, issues related to attorney-client privilege can require significant attention during the document search, review, and production processes for these cases.  Addressing attorney-client privilege requires particular nuance when considering “dual-purpose communications,” in which both legal advice and business guidance are discussed.  By granting certiorari to hear arguments on In re Grand Jury, 23 F. 4th 1088 (9th Cir. 2022), the US Supreme Court will consider soon a split among federal judicial circuits regarding the test to use when assessing whether attorney-client privilege applies with regard to such “dual-purpose communications.”

The Ninth Circuit’s opinion in this case focused on a choice between two different tests used in the circuit to assess privilege in dual-purpose communications: the “primary purpose” test and the “because of” test.  When using the “primary purpose” test, courts “look at whether the primary purpose of the communication is to give or receive legal advice, as opposed to business or tax advice.  . . .  The natural implication of this inquiry is that a dual-purpose communication can only have a single ‘primary’ purpose.”  In re Grand Jury, 23 F. 4th 1088, 1092 (9th Cir. 2022) (referring to In re County of Erie, 473 F.3d 413, 420 (2d. Cir. 2007).  In contrast, the “because of” test, typically applied in the context of work-product protection, “‘does not consider whether litigation was a primary or secondary motive behind the creation of a document’” and instead “‘considers the totality of the circumstances and affords protection when it can fairly be said that the document was created because of anticipated litigation, and would not have been created in substantially similar form but for the prospect of that litigation.’”  Id. at 1092-93 (citing In re Grand Jury Subpoena (Mark Torf/Torf Env’t Mgmt.), 357 F.3d 900, 908 (9th Cir. 2004).  The Ninth Circuit adopted the “primary purpose” test in its opinion in In re Grand Jury.

When hearing this case, the Supreme Court will address a split among three federal appellate circuits.  Through its In re Grand Jury decision, the Ninth Circuit has adopted its “primary purpose” test.  The D.C. Circuit employs a standard that requires a legal purpose to be a primary purpose (but not necessarily the primary purpose) of the communication, as it asks, “Was obtaining or providing legal advice a primary purpose of the communication, meaning one of the significant purposes of the communication?”  In re Kellogg Brown & Root, Inc., 756 F.3d 754 (D.C. Cir. 2014).  (While recognizing the difference between these two formulations of the “primary purpose” test, the Ninth Circuit declined to adopt the D.C. Circuit’s formulation of this test in its In re Grand Jury opinion and instead left open the question of which formulation is appropriate, as it found that determination outside the scope of the case before it.)  The Seventh Circuit holds that attorney-client privilege does not apply to “dual-purpose” communications, at least in the tax context.  United States v. Frederick, 182 F.3d 496, 501 (7th Cir. 1999).

Through an opinion that resolves the current split among federal judicial circuits regarding the assessment of attorney-client privilege in “dual-purpose” communications, the Supreme Court may provide greater uniformity in how parties and their counsel address privilege issues, which are often particularly significant in cases involving voluminous involving electronic discovery.