2012 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

12-11-2012

In Re: Grand Jury

Precedential or Non-Precedential: Precedential

Docket No. 12-1697

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PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

_______________

Nos. 12-1697 & 12-2878

_______________

IN RE: GRAND JURY

JOHN DOE 1; JOHN DOE 2; ABC CORPORATION,

ABC Corp.

_______________

On Appeal from the United States District Court

for the Eastern District of Pennsylvania

(D.C. Grand Jury Action No. 2-09-gj-00006)

District Judge: Honorable Harvey Bartle, III

_______________

Argued October 9, 2012

_______________

Before: AMBRO, HARDIMAN 

and VANASKIE, Circuit Judges

(Opinion file: December 11, 2012)

Stephen R. LaCheen, Esquire (Argued)

LaCheen Wittels & Greenberg

1429 Walnut Street, Suite 1301

Philadelphia, PA 19102-0000
2

Ian M. Cominsky, Esquire (Argued)

Matthew D. Lee, Esquire

Blank Rome

130 North 18th Street

One Logan Square

Philadelphia, PA 19103

Counsel for ABC Corp.

Frank P. Cihlar, Esquire

Gregory V. Davis, Esquire

S. Robert Lyons, Esquire

Alexander P. Robbins, Esquire (Argued)

United States Department of Justice

Tax Division

950 Pennsylvania Avenue, N.W.

P.O. Box 502

Washington, DC 20044-0000

Karen L. Grigsby, Esquire

Patrick J. Murray, Esquire

Office of the United States Attorney

615 Chestnut Street, Suite 1250

Philadelphia, PA 19106

David I. Sharfstein, Esquire

United States Department of Justice

Civil Division, Appellate Staff

601 D Street, N.W.

Washington, DC 20530-0000

Counsel for Appellee
3

_______________

OPINION OF THE COURT

_______________

AMBRO, 

ABC Corp., John Doe 1, and John Doe 2 are subjects 

of an ongoing grand jury investigation into an alleged 

criminal tax scheme.

Circuit Judge

1

When ABC Corp. objected that the Government had 

improperly served a subpoena for documents on ABC Corp., 

the Government issued grand jury subpoenas for those 

documents to ABC Corp.’s current outside counsel—

LaCheen, Wittels & Greenberg, LLP, and Blank Rome, LLP.

Later, it also served subpoenas for documents and testimony 

on three attorneys formerly employed by ABC Corp. as inhouse counsel. In each instance, the firms and counsel 

asserted attorney-client and work product privileges on ABC 

Corp.’s behalf, the Government moved to enforce the 

subpoenas, and ABC Corp. opposed the motion as the 

purported privilege holder. 

 As part of that scheme, ABC Corp., 

under the direction of John Doe 1 and John Doe 2, purchased 

and subsequently sold numerous companies. These

consolidated appeals concern whether documents and 

testimony relating to legal advice obtained by ABC Corp. in 

connection with these transactions are shielded by the 

attorney-client and work product privileges. 

 

1 We use pseudonyms to refer to the grand jury subjects to 

protect the secrecy of the grand jury investigation and the 

anonymity of the subjects.
4

The District Court granted the Government’s motions 

to enforce based in part on the crime-fraud exception, which 

permits the Government to obtain access to otherwise 

privileged communications and work product when they are 

used in furtherance of an ongoing or future crime. Finding 

that the requested communications and work product either 

did not qualify as privileged or that any protection afforded 

was vitiated by this exception, the Court largely rejected ABC 

Corp.’s privilege claims and issued corresponding disclosure 

orders—the first directed to ABC Corp., LaCheen Wittels, 

and Blank Rome in March 2012 (the “March Order”), and the 

second directed to the three in-house counsel in June 2012 

(the “June Order”). 

ABC Corp. seeks to appeal these Orders.

2

 2 John Doe 1 and John Doe 2 also seek to appeal. Because we 

conclude they lack standing to do so, see infra Part II, we 

dismiss their appeals.

Disclosure 

orders are not normally immediately appealable final 

decisions. To obtain immediate appellate review, a privilege 

holder must disobey the court’s order, be held in contempt, 

and then appeal the contempt order. That has not happened 

here. ABC Corp. argues nonetheless that it can appeal under

an exception to the contempt rule established in Perlman v. 

United States, 247 U.S. 7 (1918). Under Perlman, a privilege 

holder may immediately appeal an adverse disclosure order 

when the traditional contempt route is unavailable to it

because the privileged information is controlled by a 

disinterested third party who is likely to disclose that 

information rather than be held in contempt for the sake of an 

immediate appeal.
5

We disagree that we have jurisdiction to hear ABC 

Corp.’s appeal from the March Order.3 It directs both ABC 

Corp. and the law firms to produce the withheld documents. 

While Blank Rome is in physical possession of them, it is 

holding them at the behest of ABC Corp. If ABC Corp. 

wants immediate appellate review, it can take possession of 

the documents, defy the disclosure Order, and appeal any 

resulting contempt sanctions.4

We agree, however, that we have jurisdiction to hear 

ABC Corp.’s appeal from the June Order, which is directed 

solely to its former in-house counsel. ABC Corp. cannot be 

held in contempt of this Order because it does not direct ABC 

Corp. to take or refrain from any action. And there is no 

indication that ABC Corp.’s former employees are anything 

but disinterested third parties unwilling to be held in contempt 

to vindicate its purported privilege. We therefore reach the 

merits of ABC Corp.’s appeal from the June Order.

 Because it has not yet taken 

these steps, we dismiss its appeal from the March Order for 

lack of appellate jurisdiction.

 3 We previously issued an opinion and judgment on May 24, 

2012, dismissing the appeal of the March Order for lack of 

jurisdiction. Although we continue to dismiss the appeal for 

lack of jurisdiction, we vacate that opinion to avoid any 

confusion—particularly with respect to our dicta in that 

opinion regarding a recent Supreme Court case, Mohawk

Industries, Inc. v. Carpenter, 558 U.S. 100, 130 S. Ct. 599 

(2009).

4 As we explain below, if the parties cannot agree on how to 

transfer the documents, the District Court should impose a 

suitable method of transfer.
6

ABC Corp. alleges a series of problems with that 

Order: (1) the Court applied the wrong standard of proof in 

determining whether the Government made a sufficient 

showing to support application of the crime-fraud exception; 

(2) no matter the proof required, the Court wrongly found that 

the Government satisfied its burden; (3) the Court erred in 

applying the crime-fraud exception to work product generated 

by the in-house counsel because there is no suggestion these 

attorneys were involved in the alleged criminal scheme; and 

(4) with respect to five particular documents, the Court ruled 

incorrectly that they either did not qualify as privileged or 

were subject to the crime-fraud exception.

We sympathize with the difficult position of ABC 

Corp.’s attorneys. They are arguing against the applicability 

of the crime-fraud exception without knowledge of the 

underlying evidence for that exception. Because this 

evidence would reveal aspects of the grand jury’s 

investigation and thus cannot be made public, the District 

Court filed its March and June Orders under seal and 

provided only redacted copies to the parties. See Fed. R. 

Crim. P. 6(e)(2). Though we limit our discussion to 

background facts already disclosed to both parties in order to 

maintain this secrecy, we have received and closely reviewed 

unredacted versions of the Orders, as well as secret grand jury 

information submitted ex parte by the Government.5

 5 Though we only have jurisdiction to hear ABC Corp.’s

appeal of the District Court’s June Order, we review the 

Court’s crime-fraud findings from its March Order to the 

extent they formed the basis for its June Order.

 On the 

basis of that review, we affirm the District Court’s June 

Order.
7

I. Background

A.

ABC Corp., John Doe 1, and John Doe 2 are subjects 

of an ongoing grand jury investigation that seeks to determine 

whether they and others undertook fraudulent business 

transactions in order to evade federal income taxes. ABC 

Corp. is an administratively “dissolved” corporation. It was 

formed in early 2004 and it ceased business operations in late 

2005. John Doe 1 was the company’s President and sole 

(though indirect) shareholder. John Doe 2, who was also 

affiliated with the company, is his son. 

The Alleged Criminal Scheme

During ABC Corp.’s existence, it acquired companies 

with large cash accounts, few or no tangible assets, and 

considerable tax liabilities. ABC Corp. would transfer these

target companies to two limited liability companies. 

According to the Government, shortly thereafter the limited 

liability companies would engage in various transactions that 

had the effect of fraudulently eliminating the target 

companies’ tax liabilities. Having done so, John Doe 1 and 

John Doe 2 would then divert the target companies’ cash 

assets to themselves and their family members.

B.

In December 2010, the grand jury issued a subpoena to 

ABC Corp.’s former vice president of corporate acquisitions 

as the company’s custodian of records. The subpoena sought 

all records relating to transactions and business dealings 

between ABC Corp. and specific entities, including the two 

limited liability companies implicated in the alleged criminal 

scheme. At some time the Government received access to, or 

copies of, ABC Corp. documents from a law firm that 

previously represented the company. The firm withheld 

The District Court’s March Order 
8

documents that ABC Corp. claimed were privileged but did 

not supply the Government with a privilege log. 

ABC Corp. subsequently changed representation. 

LaCheen Wittels now represents ABC Corp. and John Doe 1, 

while Blank Rome represents John Doe 2. As is often the 

case, the grand jury subjects have a joint-defense agreement 

in place. 

Following this change in representation, the documents 

that had been held by ABC Corp.’s former outside counsel 

were transferred to Blank Rome. The documents were 

transferred to Blank Rome rather than Lacheen Wittels 

because, according to ABC Corp., LaCheen Wittels does not 

have sufficient space to store the documents. After the 

documents were transferred, ABC Corp. provided the 

Government with a privilege log in April 2011 for the 

documents it was withholding. Despite previously producing 

documents and providing this privilege log, ABC Corp. for 

the first time also took the position that the Government had 

not effectively served the subpoena on its former vice 

president. 

To address any problems arising from its alleged 

service error, the Government served grand jury subpoenas on

LaCheen Wittels and Blank Rome. The subpoenas sought all 

documents relating to ABC Corp. that Blank Rome received 

from ABC Corp.’s former outside counsel. In response to 

these subpoenas, Blank Rome produced approximately 24

boxes of documents. It continued to withhold, however, the 

documents listed in the April 2011 privilege log, and ABC 

Corp. provided the Government with another privilege log in 

June 2011 for additional documents withheld.

Thereafter the Government filed a motion to enforce 

the subpoenas, requesting that ABC Corp., Blank Rome, and 
9

LaCheen Wittels be required to disclose 171 of the 303 

documents identified in the privilege logs. It argued that even 

if the documents were otherwise entitled to protection under 

the attorney-client privilege and work product doctrine, the 

crime-fraud exception wipes away that protection.

The March Order directed ABC Corp., Blank Rome, 

and LaCheen Wittels to produce 167 of the 171 requested 

documents. The District Court concluded that the crimefraud exception barred ABC Corp.’s privilege and work 

product claims. It did not resolve whether the Government

had properly served ABC Corp.

Five days later, ABC Corp., John Doe 1, John Doe 2 

filed a timely notice of appeal and a motion for a stay of the 

District Court’s order pending appeal. We granted the stay

and expedited the appeal.

6

In May 2012, we issued an opinion and judgment

dismissing the appeal for lack of jurisdiction because ABC 

Corp. could receive immediate appellate review by taking 

possession of the documents, refusing to produce them, and 

then appealing any contempt sanctions imposed by the 

District Court. We left it to ABC Corp., the Government, and 

 

 6 ABC Corp. had previously attempted another Perlman

appeal in this matter. See In re Grand Jury Matter #4, No. 

11-4105 (3d Cir. Dec. 20, 2011) (dismissing summarily for 

lack of jurisdiction). According to ABC Corp., the 

documents at issue in that appeal had already been turned 

over to and reviewed by the Government by the time the 

panel issued its order. Here, in contrast, the documents are 

not in the Government’s possession and the Government has 

not reviewed them.
10

the District Court to select a procedure for transferring the 

documents from Blank Rome to ABC Corp. if it still wished 

to pursue a contempt appeal.

Shortly after our May 2012 order issued, the parties 

had a conference call with Judge Bartle to discuss how to 

transfer the documents from Blank Rome to ABC Corp. 

Following that call, Blank Rome sent a letter to the 

Government proposing two potential mechanisms for 

permitting ABC Corp. to seek appellate review following a 

contempt sanction: (1) Blank Rome could transfer possession 

of the privileged documents to the Clerk of the Court, who 

would hold the documents until ABC Corp. either decided not 

to be held in contempt or until after final appellate review; or

(2) the Government could stipulate that even if the documents 

remained in the physical possession of Blank Rome, they are 

being held by that firm as an agent for ABC Corp. Under 

either scenario, if ABC Corp. decided to refuse to comply 

with the disclosure order, only it would be subject to 

contempt sanctions.

The Government, in a letter dated May 30, 2012, 

rejected both of these proposals “because they provide no 

avenue for a meaningful contempt sanction.” It also noted its 

belief that the law firms could still be held in contempt for not 

producing the documents if the parties could not come to an 

agreement on how to transfer the documents. 

After we granted its motion to lift the stay in this case

on June 5, 2012, the Government sent a letter to Judge Bartle 

enclosing a proposed order outlining a procedure for 

transferring the documents. If entered, it would require Blank 

Rome either to (1) appear in court and produce the documents 

at issue to the Government or (2) appear in court and produce 

documents to a representative of ABC Corp. who was willing 

and authorized to (a) accept service on behalf of ABC Corp., 
11

(b) take custody of and maintain the transferred documents 

until produced to the Government, and (c) suffer significant 

contempt sanctions. The District Court was unable to act on 

the proposed order, however, because we reinstated the stay 

on June 6, 2012.

ABC Corp., John Doe 1, and John Doe 2 subsequently 

filed a petition for panel rehearing or rehearing en banc. We 

granted the petition for a panel rehearing to revisit, in light of 

the developments on remand, our holding that we lacked 

jurisdiction under Perlman to hear this appeal. 

C.

In December 2011 grand jury subpoenas were issued 

to three attorneys formerly employed by ABC Corp. as inhouse counsel. Each of the attorneys received two subpoenas, 

one seeking testimony and documents from that attorney in 

his or her individual capacity and one seeking documents and 

testimony from him or her as a custodian of records for ABC 

Corp. 

The District Court’s June Order

In response to these subpoenas, the attorneys withheld

45 documents and refused to testify as to certain matters on 

the grounds that the information sought is shielded from 

production by the attorney-client privilege and the work 

product doctrine.7

 7 One of the attorneys did not withhold any documents as 

privileged because she claims not to have any documents 

responsive to the subpoena.

 When the Government subsequently filed 

a motion to enforce the subpoenas, ABC Corp., who 

successfully intervened to contest the subpoena, opposed that

motion on the same grounds.
12

The June Order reaffirmed the District Court’s prior 

crime-fraud ruling. The Court required the in-house counsel 

to produce 11 of the 45 withheld documents, finding that they

were either not privileged at all or that any privilege was 

vitiated by the crime-fraud exception. It also instructed the 

attorneys to testify about transactions involving the target 

companies that ABC Corp. ultimately sold to the two limited 

liability companies implicated in the alleged criminal scheme.

ABC Corp., John Doe 1, and John Doe 2 subsequently

filed a notice of appeal and the District Court granted a stay 

of their order pending appeal. We consolidated the appeals of 

the District Court’s March and June Orders.

II. Standing

Although the Government does not challenge 

Appellants’ standing, we are obliged to address it sua sponte. 

FW/PBS, Inc. v. City of Dallas, 493 U.S. 215, 230-31 (1990) 

(quoting Anthony v. Council, 316 F.3d 412, 416 (3d Cir. 

2003)). A person has standing to challenge a grand jury 

subpoena issued to another when he has a “sufficiently 

important, legally-cognizable interest[] in the materials or 

testimony sought.” In re Grand Jury, 111 F.3d 1066, 1073 

(3d Cir. 1997) (collecting cases). ABC Corp. has standing to 

challenge the grand jury subpoenas because it claims 

attorney-client and work product privileges in the documents 

and testimony at issue. Id.8

 8 ABC Corp. also has standing to challenge the March Order 

because one of the subpoenas challenged was issued to it.

 John Doe 1 and John Doe 2, in 

contrast, do not hold any privilege in the sought-after 

documents or testimony and have not asserted any other 

interest in them. They therefore lacked standing to oppose 
13

the Government’s motion to enforce the subpoenas,

9

III. Jurisdiction

and do 

not have standing to appeal the District Court’s resulting 

Orders.

The District Court had jurisdiction under 18 U.S.C. 

§ 3231. Although our jurisdiction is in dispute, we have the 

jurisdiction to decide that dispute. Alaka v. Att’y Gen., 456 

F.3d 88, 94 n.8 (3d Cir. 2006).

A.

“[T]he right to a judgment from more than one court is 

a matter of grace and not a necessary ingredient of justice . . . 

.” Cobbledick v. United States, 309 U.S. 323, 325 (1940). 

Congress has bestowed this grace by granting the courts of 

appeals jurisdiction over “final decisions” of the district 

courts. 28 U.S.C. § 1291. Whether a decision is “final” 

depends on its effects. Marcus v. Twp. of Abington, 38 F.3d 

1367, 1370 (3d Cir. 1994). “Ordinarily, a final decision will 

have two effects. First, the decision will fully resolve all 

claims presented to the district court. Second, after the 

decision has been issued, there will be nothing further for the 

district court to do.” Aluminum Co. of Am. v. Beazer East, 

Inc., 124 F.3d 551, 557 (3d Cir. 1997) (citing Catlin v. United 

States, 324 U.S. 229, 233 (1945)).

Finality and the Contempt Rule

 9 Although the District Court permitted them to respond to the 

Government’s motions to enforce, John Doe 1 and John Doe 

2, unlike ABC Corp., never formally moved to intervene in 

the action, and the Court did not discuss whether they had a 

legally cognizable interest. 
14

When a district court orders a witness—whether a 

party to an underlying litigation, a subject or target of a grand 

jury investigation, or a complete stranger to the 

proceedings—to testify or produce documents, its order

generally is not considered an immediately appealable “final 

decision[]” under § 1291. See United States v. Ryan, 402 

U.S. 530, 532–34 (1971); Cobbledick, 309 U.S. at 326–29; 

Alexander v. United States, 201 U.S. 117, 118–22 (1906). It 

is well settled that a witness who “seeks to present an 

objection to a discovery order immediately to a court of 

appeals must refuse compliance, be held in contempt, and 

then appeal the contempt order.” Church of Scientology of 

Cal. v. United States, 506 U.S. 9, 18 n.11 (1992) (citing Ryan, 

402 U.S. 430); see also Cobbledick, 309 U.S. at 326–29; 

Alexander, 201 U.S. at 118–22; DeMasi v. Weiss, 669 F.2d 

114, 121–23 (3d Cir. 1982). A district court’s contempt order 

is itself immediately appealable because it is a final judgment 

imposing penalties on the willfully disobedient witness in 

what is effectively a separate proceeding. 

The contempt route to an immediately appealable final 

decision is a firmly established feature of federal appellate 

procedure, stretching back to at least the Supreme Court’s 

1906 decision in Alexander, but the decision to travel that 

route must not be made lightly. The Supreme Court has

consistently held that the 

necessity for expedition in the 

administration of the criminal law 

justifies putting one who seeks to 

resist the production of desired 

information to a choice between 

compliance with a trial court’s 

order to produce prior to any 

review of that order, and 

resistance to that order with the 
15

concomitant possibility of an 

adjudication of contempt if his

claims are rejected on appeal.

Ryan, 402 U.S. at 533 (citations omitted). The rule, “though 

at times a harsh one, was formulated to discourage appeals in 

all but the most serious cases.” In re Grand Jury 

Proceedings, 604 F.2d 798, 800 (3d Cir. 1979). Requiring a 

person who objects to a disclosure order to “refuse to comply, 

be subjected to sanctions in contempt, and then appeal from 

the sanctions . . . [,] puts the objecting person’s sincerity to 

the test by attaching a price to the demand for immediate 

review.” Wilson v. O’Brien, 621 F.3d 641, 643 (7th Cir. 

2010). It forces the objector to weigh carefully the likelihood 

of success of its challenge to the underlying disclosure order 

against the seriousness of the sanctions it would face—

whether incarceration, a hefty monetary fine, or some other 

penalty—if it disobeys the order to disclose. It also forces the 

objector to assess the importance it attaches to avoiding the 

ordered disclosure and protecting any associated privileges.

B.

In Perlman v. United States, 247 U.S. 7 (1918), the 

Supreme Court carved out an exception to the rule that a 

privilege holder must stand in contempt of a disclosure order 

before an immediate appeal may be taken. 

The Perlman Exception to the Contempt Rule

Louis Perlman testified on behalf of his company in a 

patent infringement suit in District Court. Id. at 8. When the

company moved to dismiss its suit without prejudice, the 

District Court granted the company’s motion, but it ordered 

the court clerk to impound the exhibits Perlman used during 

his testimony and to maintain them under seal. Id. at 8–9. 
16

Soon after, the Government began a grand jury 

investigation of Perlman, suspecting him of perjury during his 

prior testimony. Id. at 11–12. To assist in the investigation, 

the Government sought an order from the District Court 

directing the court clerk to produce the exhibits Perlman used 

during his testimony. Id. at 9–10. Perlman objected, 

claiming that use of the exhibits as a basis for indictment 

against him would be an unreasonable search and seizure and 

would make him a compulsory witness against himself in 

violation of the Constitution’s Fourth and Fifth Amendments. 

Id. at 10, 13. The District Court rejected Perlman’s challenge 

and ordered the clerk to produce the exhibits to the 

Government. Id. at 10–11.

When Perlman ultimately appealed to the Supreme 

Court, which heard the case under its then-obligatory 

appellate jurisdiction, the Government argued that the District 

Court’s disclosure order was not appealable. Id. at 12. The 

Supreme Court disagreed, saying only that

[t]he second contention of the 

government is somewhat strange, 

that is, that the order granted upon 

its solicitation was not final as to 

Perlman but interlocutory in a 

proceeding not yet brought and 

depending upon it to be brought. 

In other words, that Perlman was 

powerless to avert the mischief of 

the order but must accept its 

incidence and seek a remedy at 

some other time and in some other 

way. We are unable to concur.

Id. at 12–13.
17

Though the Perlman doctrine’s reach has not been set 

precisely by the Supreme Court, it generally permits an 

interlocutory appeal of a disclosure order if it is directed at a 

disinterested third party lacking a sufficient stake in the 

proceeding to risk contempt by refusing compliance. See

Church of Scientology, 506 U.S. at 18 n.11; United States v. 

Nixon, 418 U.S. 683, 691 (1974).

10

 10 For example, in Perlman the clerk of the court presumably 

lacked any stake in Perlman’s grand jury proceedings to risk 

contempt by refusing to comply with the subpoena. See Nat’l 

Super Spuds, Inc. v. New York Mercantile Exch., 591 F.2d 

174, 179 (2d Cir. 1979) (“In fact it was not only ‘unlikely’ 

but unimaginable.” (quoting United States v. Nixon, 418 U.S. 

683, 691 (1974)). 

 In that circumstance, the 

privilege holder is allowed to appeal immediately without 

suffering contempt sanctions because the privilege holder

cannot itself disobey the disclosure order and the third party 

to whom the disclosure order is directed is unlikely to do so 

on its behalf. See In re Grand Jury Empanelled Aug. 14, 

1979, 638 F.2d 1235, 1237 (3d Cir. 1981) (explaining that the 

privilege holder in Perlman and its progeny “were not the 

targets of the subpoena itself, which meant that the contempt 

route for obtaining an appeal was not available to them”); In 

re Grand Jury Applicants, 619 F.2d 1022, 1025 (3d Cir. 

1980) (explaining that “the Alexander-Cobbledick-Ryan

[contempt] rule restricting appellate review is limited to 

situations where the contempt route to a final order is 

available to the appellant”); In re Grand Jury Proceedings, 

604 F.2d at 800–01 (permitting Perlman appeal where the 

disclosure order adverse to the attorney-client privilege was 

not directed to the privilege holder); In re Air Crash at Belle 

Harbor, N.Y. on Nov. 12, 2001, 490 F.3d 99, 105–06 (2d Cir. 

2007); Wilson, 621 F.3d at 642–43; In re Motor Fuel 
18

Temperature Sales Practices Litig., 641 F.3d 470, 485–86 

(10th Cir. 2011).

C.

In addition to contempt and Perlman appeals, some 

courts permitted privilege holders to take immediate appeals 

of adverse privilege determinations if they could satisfy the 

requirements of the collateral order doctrine. The doctrine, 

first announced in Cohen v. Beneficial Industrial Loan Corp., 

337 U.S. 541 (1949), provides that there is a small class of 

collateral rulings that, although they do not terminate the

litigation, are appropriately deemed final under § 1291. Id. at 

545–46. “That small category includes only decisions [1] that 

are conclusive, [2] that resolve important questions separate 

from the merits, and [3] that are effectively unreviewable on 

appeal from the final judgment in the underlying action.” 

Swint v. Chambers Cnty. Comm’n, 514 U.S. 35, 45 (1995). 

Mohawk and its Effect on Perlman

In Mohawk Industries, Inc. v. Carpenter, 558 U.S. 100, 

130 S. Ct. 599 (2009), however, the Supreme Court held that 

disclosure orders adverse to the attorney-client privilege do 

not qualify for immediate appeal under the collateral order 

doctrine. Focusing exclusively on the third requirement of 

the collateral order doctrine, the Mohawk Court held that 

“collateral order appeals are not necessary to ensure effective 

review of orders adverse to the attorney-client privilege” 

where the privilege holder is a party to the litigation because 

“postjudgment appeals generally suffice to protect the rights 

of litigants and assure the vitality of the attorney-client 

privilege.” Mohawk, 130 S. Ct. at 606. “Appellate courts can 

remedy the improper disclosure of privileged material in the 

same way they remedy a host of other erroneous evidentiary 

rulings: by vacating an adverse judgment and remanding for 

a new trial in which the protected material and its fruits are 

excluded from evidence.” Id. at 606–07.
19

The Government argues that this decision narrows the 

traditionally understood scope of the Perlman doctrine to 

instances where effective postjudgment review is unavailable. 

Deciding whether Mohawk precludes our jurisdiction in this 

case—where the privilege holder, ABC Corp., is a subject of 

a grand jury investigation—prompts two distinct inquiries. 

The first is whether Mohawk, which dealt with the 

collateral order doctrine, applies to the Perlman rule at all. 

Other courts of appeals—see Holt-Orsted v. City of Dickson, 

641 F.3d 230, 236–40 (6th Cir. 2011); United States. v. 

Krane, 625 F.3d 568, 572–73 (9th Cir. 2010); Wilson, 621 

F.3d at 642–43—have concluded that the Supreme Court’s 

reasoning in Mohawk about the effective reviewability of 

disclosure orders that would break the attorney-client 

privilege applies equally to Perlman so long as the privilege 

holder is a party to an underlying litigation. When that is the 

case, those claims can be reviewed effectively postjudgment, 

making immediate appeals unnecessary. 

Assuming Mohawk narrows Perlman at all, the second 

inquiry is whether this reasoning extends to prohibit Perlman

appeals from grand jury investigations. An order requiring 

the disclosure of privileged materials arguably is as 

effectively reviewable, absent an immediate appeal, for 

subjects of a grand jury investigation as it is for parties in 

civil litigation. If the grand jury’s investigation leads to an 

indictment and later a conviction, we can remedy an

“improper disclosure of privileged material . . . by vacating 

the adverse judgment and remanding for a new trial in which 

the protected material and its fruits are excluded from 

evidence.” Mohawk, 130 S. Ct. at 606–07. Of course, this 

may not always be the case. A subject of a grand jury 

investigation may not actually have an opportunity for postconviction review of a disclosure order; he may never be 

indicted, the charges may be dismissed, or he may be 
20

acquitted. The same is often true in civil litigation, however. 

After an unfavorable privilege ruling, a civil litigant may

nonetheless settle, obtain summary judgment, or win a 

favorable verdict, leaving the privilege broken and the 

District Court’s ruling unchallenged. 

Regardless, we decline to hold that the Supreme Court 

narrowed the Perlman doctrine—at least in the grand jury 

context—sub silentio. See Hohn v. United States, 524 U.S. 

236, 252–53 (1998) (“Our decisions remain binding 

precedent until we see fit to reconsider them, regardless of 

whether subsequent cases have raised doubts about their 

continuing vitality.”); Rodriguez de Quijas v. Shearson/Am. 

Express, Inc., 490 U.S. 477, 484 (1989) (“If a precedent of 

this Court has direct application in a case, yet appears to rest 

on reasons rejected in some other line of decisions, the Court 

of Appeals should follow the case which directly controls, 

leaving to this Court the prerogative of overruling its own 

decisions.”). Perlman himself sought to prevent the 

disclosure of documents to a grand jury that was conducting 

an investigation into whether he committed perjury in a patent

infringement action. The Supreme Court has not 

subsequently suggested that Perlman’s status as a grand jury 

subject would today deny him immediate appellate review 

and the Mohawk Court gave no clear indication that this was a 

consequence of its intended holding. It did not discuss, 

mention, or even cite Perlman, a fact that is not that 

surprising given that the Perlman doctrine and the collateral 

order doctrine recognize separate exceptions to the general 

rule of finality under § 1291. See Krane, 625 F.3d at 572.

11

 11 The Mohawk Court surveyed other appellate options 

available to aggrieved privilege holders, and indicated that, 

when confronted with an adverse decision from the district 

 
21

The Government argues that we should nonetheless 

hold that the Mohawk Court narrowed Perlman because 

“Mohawk’s description of the final-judgment rule relied on . . 

. precedent regarding what it means for an order to be 

effectively ‘final,’ and this precedent indisputably includes 

Perlman.” Government’s Br. at 26 (Aug. 31, 2012). The 

Government cites Ryan for its statement that all appeals under 

§ 1291—which includes both collateral order and Perlman

appeals—should be limited to “cases where denial of 

immediate review would render impossible any review 

whatsoever of an individual’s claims.” 402 U.S. at 533; see 

also Cobbledick, 309 U.S. at 328 (noting that the “analysis of 

finality” applied in Cobbledick is “illustrated” by Perlman). 

In the same passage of Ryan, however, the Court described 

Perlman—a case where the privilege holder was a grand jury 

subject—as satisfying the finality requirement. 402 U.S. at 

533.

We cannot say that the Supreme Court has abandoned 

that determination on the basis of a later case, Mohawk, that 

never cites, let alone discusses, Perlman. If and when that

Court next hears a case involving the Perlman doctrine, it 

may well hold that the doctrine does not allow grand jury 

subjects to receive immediate appellate review of adverse 

privilege determinations. And, given the need for judicial 

efficiency in the criminal context, such a decision may be 

 

court, a party in a civil proceeding can still receive an 

immediate appeal via the contempt route. 130 S. Ct. at 607–

08. This may indicate that the Perlman doctrine, which can 

be seen as an exception to the normal rule requiring a 

privilege holder to be held in contempt to appeal 

interlocutory, remains in place where the holder is a civil 

litigant or grand jury subject.
22

justifiable. We will not, however, intrude on the Supreme

Court’s prerogative to make that determination. We therefore 

conclude that the Perlman exception remains viable.

D.

We dismiss ABC Corp.’s appeal of the District Court’s 

March Order because the contempt route remains open to it. 

It is subject to a Court Order to produce the documents. 

Although the documents are in the physical possession of 

Blank Rome, they are ABC Corp.’s documents and are under 

its legal control.

Jurisdiction over Appeal from the District Court’s 

March Order

12 See In re Grand Jury, 821 F.2d 946, 951 

(3d Cir. 1987) (“A party’s lack of possession or legal control

over documents requested by a subpoena is normally a valid 

defense to a subpoena and justification for a motion to 

quash.”); In re Marc Rich & Co., A.G., 707 F.2d 663, 667 (2d 

Cir. 1983) (“The test for the production of documents is 

control, not location.”). ABC Corp. is responsible for 

deciding whether to produce or withhold the documents, and 

could properly be held in contempt for directing the law firms 

to withhold them.13

 12 Federal Rule of Criminal Procedure 17(c) permits a court to 

“quash or modify the subpoena if compliance would be 

unreasonable or oppressive.” Whatever else Rule 17(c) 

requires, it would not be unreasonable or oppressive to 

require a witness to produce documents within his legal 

control simply because those documents are in the physical

possession of another.

13 ABC Corp. asserts that the District Court’s order 

erroneously included ABC Corp. because the Government 

never properly served the company with a subpoena and, in 
23

The situation is complicated because the Court’s Order 

is also directed at ABC Corp.’s outside counsel, exposing

them to potential contempt sanctions if they do not comply 

with it.

14

 

any event, ABC Corp. does not have custody of the 

documents. This argument misses the mark. An order does 

not become immediately appealable simply because a 

putative appellant believes that it is, in one way or another, 

wrong or improper. If ABC Corp. believes that the District 

Court’s order is reversible for whatever reason—whether 

because it was not preceded by proper service of a subpoena, 

because it was the result of an improper crime-fraud ruling, or 

for any other reason—and it wishes to present its challenge in 

an immediate appeal, it must disobey the order and take the 

contempt route. Until it is vacated, the District Court’s 

order—not the grand jury’s subpoena—binds the company 

and compels production of the documents. See Brown v. 

United States, 359 U.S. 41, 49 (1959) (“A grand jury is 

clothed with great independence in many areas, but it remains 

an appendage of the court, powerless to perform its 

investigative function without the court’s aid, because 

powerless itself to compel the testimony of witnesses.”), 

overruled on other grounds by Harris v. United States, 382 

U.S. 162, 167 (1965).

 We recognize that production of the documents by 

14 Judge Vanaskie agrees that we lack jurisdiction to review 

the March Order to the extent it requires production directly 

by ABC Corp. because it may obtain appellate jurisdiction by 

refusing to produce the contested documents and standing in 

contempt. He dissents from this section of our Opinion, 

however, because he believes we have jurisdiction over the 

Order to the extent it requires the law firms to produce the 

documents. This approach, we believe, bifurcates the Order 
24

the law firms, despite an instruction from ABC Corp. to 

withhold them, might as a practical matter avert any need for 

the Government to seek contempt sanctions against ABC 

Corp. When we first heard oral argument in this case, the 

Government, in an attempt to address this concern, indicated 

that it would not seek contempt sanctions against the law 

firms if the documents were transferred from Blank Rome to 

ABC Corp.’s possession. We agreed that this course of 

action would take care of our concern, and instructed ABC 

Corp., the Government, and the District Court to resolve a 

plan for transferring the documents. 

Unfortunately, piecemeal consensus dissolved to 

dissonance. ABC Corp. and the Government were unable to 

agree on a mechanism to transfer the documents. While ABC 

Corp. believes it sufficient for Blank Rome to transfer the 

documents generally to the possession of ABC Corp., the 

Government believes any resulting contempt sanctions 

against ABC Corp. in that circumstance would be 

meaningless because the company is defunct. Instead, the 

Government wants the documents to be transferred to a 

designated representative of the company who is personally 

willing to suffer significant contempt sanctions. 

According to ABC Corp., this inability to agree

indicates we were wrong that the contempt route remains 

 

and emphasizes too technical an understanding of our 

jurisdiction. Both Judge Vanaskie and we agree that ABC 

Corp. legally controls the documents and may be held in 

contempt for refusing to produce them. Unlike Judge 

Vanaskie, however, we see the law firms’ choice whether to 

follow their client’s directions or be held in contempt as a 

resolvable practical problem, not a basis for our jurisdiction.
25

open to it. That the parties were unable to resolve this dispute 

amicably, however, does not mean that the contempt route is 

foreclosed. The District Court—which was previously 

hamstrung due to our imposition of a stay of its March 

Order—is no doubt capable of resolving this dispute for the 

parties. 

We now lift the stay to free the Court to resolve this 

matter. If ABC Corp. continues to want to pursue a contempt 

appeal, the Court should determine an appropriate mechanism 

for transferring the documents from Blank Rome to ABC 

Corp. While we do not dictate what contempt sanctions the 

Court imposes or how the documents are transferred, it

should effect a transfer that permits it to impose sanctions 

sufficient to put ABC Corp.’s “sincerity to the test” in 

determining whether to pursue the contempt route. In re 

Grand Jury Proceedings, 604 F.2d at 800; see also Wilson, 

621 F.3d at 643.

This may mean, as the Government requests, that the 

documents are transferred to a representative of ABC Corp.

rather than into its general possession. In the normal course, 

a court can impose sanctions, including monetary fines and 

incarceration, against a disobedient corporate entity or any 

corporate officer responsible for the corporation’s refusal to 

obey. See Carol A. Jones, 10A Fletcher Cyc. Corp. § 5069

(Thomas Reuters 2011); Reich v. Sea Sprite Boat Co., Inc., 64 

F.3d 332, 334 (7th Cir. 1995); Elec. Workers Pension Trust 

Fund of local Union #58 v. Gary’s Elec. Serv. Co., 340 F.3d 

373, 382 (6th Cir. 2003); NLRB v. Maine Caterers, Inc., 732 

F.2d 689, 691 (1st Cir. 1984). If ABC Corp., as a defunct 

corporation, is nothing more than a ghost without officers or 

property, these normally effective sanctions may be

meaningless. Accordingly, the Court may, in its discretion, 

designate a representative of ABC Corp. to receive delivery 

of the documents or require ABC Corp. to do so.
26

ABC Corp. argues that “[t]here is no one who is ready, 

willing, or able, under these circumstances, to receive the 

documents and suffer incarceration to vindicate the privilege 

rights of [ABC Corp.]” Appellants’ Br. at 32 (Aug. 17, 

2012). This proves too much. Corporations act through and 

are controlled by individuals. There must be some person or 

persons directing ABC Corp. to assert privilege over the 

withheld documents. If those person(s) are unwilling to 

suffer contempt sanctions, this only points out that the 

privilege holder has weighed its chances of success on appeal 

against the seriousness of the sanctions it will face for 

disobeying the District Court’s Order, and determined that it 

is unwise to seek immediate appeal. 

We stress that if the documents are transferred 

pursuant to court order (or an eleventh hour agreement 

between the parties), the law firms—absent bad faith 

dealings—should not be the target of any sanctions. We are 

confident that the Government, consistent with its 

representations to us, will not seek to hold the law firms in 

contempt in that event. And no doubt the District Court

appreciates this difficult predicament.

15

 15 ABC Corp. contends that the Government’s position 

ignores the seriousness of a grand jury subpoena and court 

order, and that the law firms could be charged with 

obstruction of justice by engaging in behavior intended to 

thwart the grand jury’s investigation. See 18 U.S.C. § 1503 

(obstruction of grand jury investigation). These concerns are 

understandable, but, we believe, unfounded. It would not be 

obstruction of justice, as the Government conceded at oral 

argument, if Blank Rome transfers the documents to ABC 

Corp.—after giving the Government and the District Court 

sufficient notice of the time, place, and other circumstances of 
27

ABC Corp. cautions that refusing to hear this appeal 

would “essentially destroy[] the Perlman doctrine” because 

“Perlman can now be defeated if the government or another 

litigant simply names the privilege holder in the motion to 

compel and includes the privilege holder in the compulsion 

order, even where the privilege holder is not in possession of 

the subpoenaed documents.” Appellants’ Br. at 36. This 

concern is overstated. Our reasoning would only prevent an 

appeal where a privilege holder subject to a disclosure order 

retains legal control of the documents that are in the physical 

possession of another and the Government has agreed that the 

documents can be transferred to the privilege holder without 

the transferor risking contempt.16

 

the transfer—so that the company can go down the wellestablished path of disobeying a disclosure order, suffering 

contempt, and then appealing any contempt sanctions. Of 

course, this is not a license for Blank Rome to send the 

documents out of the jurisdiction or to act with bad faith in 

any way when transferring the documents to ABC Corp. 

 Although the Government 

may be wise in the future to avoid these complications by 

issuing a subpoena only to the privilege holder, the contempt 

16 Several courts of appeals permit Perlman appeals where the 

disclosure order is directed solely at the privilege holder’s 

attorney. In re Grand Jury Subpoenas, 123 F.3d 695, 698-

700 (1st Cir. 1997) (collecting cases). These cases are 

properly distinguished because their disclosure orders were 

not also directed at the privilege holder, making it effectively 

impossible for the holder to be held in contempt. These cases 

often concern as well the production of subpoenaed 

documents (e.g., law firm records) that are legally controlled 

by the firm rather than the client. See, e.g., In re Klein, 776 

F.2d 628 (7th Cir. 1985).
28

route remains open in this instance and there is no need for us 

to allow a Perlman appeal. 

E.

We do, however, have jurisdiction to hear ABC 

Corp.’s appeal of the District Court’s June Order. The 

contempt route is not open to ABC Corp. because the 

subpoena and subsequent Order were directed solely at the 

three former ABC Corp. in-house attorneys. There is also no 

basis to believe that these former employees are anything but 

disinterested third parties who are unlikely to stand in 

contempt to vindicate ABC Corp.’s alleged privilege. 

Recognizing these facts, the Government does not argue that 

the contempt route remains open to ABC Corp., relying 

instead on its argument that Mohawk precludes a privilege 

holder who is a grand jury subject from appealing under

Perlman. As explained above, we decline to hold that 

Mohawk so narrows Perlman. Accordingly, we reach the 

merits of this appeal with one exception.

Jurisdiction over Appeal from the District Court’s June 

Order

In its June Order, the District Court rejected ABC 

Corp.’s request to issue an order requiring the Government to 

allow ABC Corp. to preview the questions that the 

Government intended to ask the in-house counsel before the 

grand jury. ABC Corp. does not argue that the District 

Court’s refusal to allow it to preview these questions—a 

ruling based primarily on the Court’s determination that there 

was no compelling necessity to justify breaking the seal of 

secrecy normally afforded to grand jury investigations—is 

independently appealable prior to a final decision on the 

merits. Instead, it asks us to consider this ruling in the course 

of deciding its substantive privilege claims on the theory that 

its inability to preview the questions prevented it from 

effectively defending its privileges.
29

ABC Corp. has not cited, and we have not found, any 

case where we have considered this sort of ancillary due 

process issue in the course of hearing substantive privilege 

claims on a Perlman appeal. We have, to be sure, previously 

considered other procedural issues—such as whether a district 

court erred in refusing to order the Government to disclose its

ex parte affidavit supporting application of the crime-fraud 

exception, In re Grand Jury Subpoena, 223 F.3d 213, 219 (3d 

Cir. 2000), and whether a district court erred in holding a 

hearing ex parte to determine the reasonableness of a 

subpoena, In re Grand Jury, 103 F.3d 1140, 144–45 (3d Cir. 

1997)—in the course of deciding a Perlman appeal. These

procedural questions, however, were closely tied to the 

substantive issues raised on appeal. They concerned the 

disclosure of evidence underlying the challenged district court 

ruling or the method employed to test the sufficiency of that 

evidence. The question presented here—whether ABC 

Corp.’s defense of its privilege was hindered by being denied 

the opportunity to preview grand jury questions—is

significantly more tangential to the substantive privilege 

issues resolved by the District Court.

17

 17 To the extent ABC Corp. is arguing that the District Court 

erred in choosing not to evaluate ABC Corp.’s privilege 

claims on a question-by-question basis—an issue over which 

we would have jurisdiction because it goes to the District 

Court’s reasoning in evaluating the challenged privilege 

ruling—we are unconvinced that the Court erred. It engaged 

in a detailed analysis of the crime-fraud exception and 

whether it applied to the witnesses’ testimony. Although 

courts often analyze privilege issues on a question-byquestion basis, there is no support for ABC Corp.’s 

suggestion that the Court’s analysis was somehow deficient 

solely because it chose not to do so.
30

As the Supreme Court reiterated in Mohawk, Congress 

has shown a preference that the appealability of decisions

under § 1291 be determined through the rulemaking process 

rather than through court decision. Mohawk, 130 S. Ct. at 

609 “Specifically, Congress in 1990 amended the Rules 

Enabling Act to authorize th[e] [Supreme] Court to adopt 

rules defin[ing] when a ruling of a district court is final for 

the purposes of appeal under section 1291. . . . These 

provisions . . . warrant the Judiciary’s full respect.” Id. 

(alteration omitted) (quotation marks and citations omitted). 

Because we derive our jurisdiction from Congress’s 

exercise of its authority to “ordain and establish” inferior 

courts, U.S. Const., Art. III, § 1, we are obliged to defer to 

Congress in this context. In addition, declining to expand our 

jurisdiction through court decision reflects an understanding 

of our institutional limitations in accurately predicting the 

effect that jurisdictional rules will have on judicial 

economy—an interest that is particularly important in the 

grand jury context. For these reasons, we decline to exercise 

jurisdiction over this ancillary procedural issue.

IV. Merits

A.

“Though they both operate to protect information from 

discovery, the work-product doctrine and the attorney-client 

privilege serve different purposes.” In re Chevron Corp., 633 

F.3d 153, 164 (3d Cir. 2011). The attorney-client privilege 

protects from disclosure confidential communications made 

between attorneys and clients for the purpose of obtaining or 

providing legal assistance to the client. In re Teleglobe 

Commc’ns Corp., 493 F.3d 345, 359 (3d Cir. 2007); accord

Restatement (Third) of the Law Governing Lawyers § 68 

(2000). Although such communications may be both relevant 

Crime-Fraud Exception: Quantum of Proof
31

and highly probative of the truth, we shield them from 

production in order “to encourage full and frank 

communication between attorneys and their clients and 

thereby promote broader public interests in the observance of 

law and administration of justice.” Upjohn Co. v. United 

States, 449 U.S. 383, 389 (1981). 

The work product doctrine, in contrast, “promotes the 

adversary system by enabling attorneys to prepare cases 

without fear that their work product will be used against their 

clients.” In re Chevron Corp., 633 F.3d at 164 (quotation 

marks and citation omitted). It “protects from discovery

materials prepared or collected by an attorney ‘in the course 

of preparation for possible litigation.’” In re Grand Jury 

Investigation, 599 F.2d 1224, 1228 (3d Cir. 1979) (quoting 

Hickman v. Taylor, 329 U.S. 495, 505 (1947)). 

Despite their importance, the protections afforded by 

the attorney-client privilege and the work product doctrine are

not absolute. The Supreme Court has explained that the 

crime-fraud exception is one limit on the scope of the 

protection afforded by the attorney-client privilege. 

The attorney-client privilege must 

necessarily protect the 

confidences of wrongdoers, but 

the reason for that protection—the 

centrality of open client and 

attorney communication to the 

proper functioning of our 

adversary system of justice—

ceases to operate at a certain 

point, namely, where the desired 

advice refers not to prior 

wrongdoing, but to future 

wrongdoing. 
32

United States v. Zolin, 491 U.S. 554, 562–63 (1989)

(quotation marks, alterations, and citations omitted). We 

have held that this exception also applies to the work product 

doctrine. “The work product privilege is perverted if it is 

used to further illegal activities as is the attorney-client 

privilege, and there are no overpowering considerations in 

either situation that would justify the shielding of evidence 

that aids continuing or future criminal activity.” In re Grand 

Jury Proceedings, 604 F.2d 798, 802 (3d Cir. 1979).

To circumvent these privileges under the crime-fraud 

exception, the party seeking to overcome the privilege—in 

this case, the Government—“must make a prima facie

showing that (1) the client was committing or intending to 

commit a fraud or crime, and (2) the attorney-client 

communications were in furtherance of that alleged crime or 

fraud.” In re Grand Jury Subpoena, 223 F.3d at 217

(citations omitted). The “prima facie” standard is drawn from 

the Supreme Court’s decision in Clark v. United States, 289 

U.S. 1 (1933). 

There are early cases apparently 

to the effect that a mere charge of 

illegality, not supported by any 

evidence, will set the confidences 

free. But this conception of the 

privilege is without support in 

later rulings. It is obvious that it 

would be absurd to say that the 

privilege could be got rid of 

merely by making a charge of 

fraud. To drive the privilege 

away, there must be something to 

give colour to the charge; there 

must be prima facie evidence that 

it has some foundation in fact. 
33

When that evidence is supplied, 

the seal of secrecy is broken.

Id. at 15 (quotation marks and citations omitted).

While there is general agreement on these precepts, 

courts of appeals are divided as to the appropriate quantum of 

proof necessary to make a prima facie showing. This is not 

surprising. “‘Prima facie’ is among the most rubbery of all 

legal phrases; it usually means little more than a showing of 

whatever is required to permit some inferential leap sufficient 

to reach a particular outcome.” In re Grand Jury

Proceedings, 417 F.3d 18, 22–23 (1st Cir. 2005) (citing 

Black’s Law Dictionary 1228 (8th ed. 2004); McDonnell 

Douglas Corp. v. Green, 411 U.S. 792, 802 (1973)). 

When the Supreme Court last addressed the crimefraud exception, it did little to clarify the necessary 

evidentiary showing. Because it is difficult to determine 

whether a document contains communications used in 

furtherance of a crime or fraud, courts sometimes review the 

allegedly privileged materials in camera to decide whether 

the crime-fraud exception applies to preclude the privilege. 

The Supreme Court affirmed the permissibility of that 

practice in Zolin so long as there is independent evidence 

“sufficient to support a reasonable belief that in camera

review may yield evidence that establishes the exception’s 

applicability.” 491 U.S. at 574–75. The Court indicated that 

this is a “lesser evidentiary showing” than is “required 

ultimately to overcome the privilege,” id. at 572, but declined 

to address the amount of proof that is ultimately required, id.

at 563.

Courts of appeals have articulated the proper measure 

of proof in different ways. Some require there to be probable 

cause or a reasonable basis to suspect or believe that the client 
34

was committing or intending to commit a crime or fraud and 

that the attorney-client communications were used in 

furtherance of the alleged crime or fraud. See In re Grand 

Jury Proceedings, 417 F.3d at 23 & n.4; United States v. 

Jacobs, 117 F.3d 82, 87 (2d Cir. 1997); United States v. 

Collis, 128 F.3d 313, 321 (6th Cir. 1997); In re Grand Jury 

Proceedings, 87 F.3d 377, 381 (9th Cir. 1996). Other courts 

call for evidence sufficient to compel the party asserting the 

privilege to come forward with an explanation for the 

evidence offered against the privilege. See United States v. 

Boender, 649 F.3d 650, 655–56 (7th Cir. 2011); In re Grand 

Jury Subpoena, 419 F.3d 329, 336 (5th Cir. 2005). Still other 

courts demand a showing of evidence that, if believed by a

trier of fact, would establish that some violation was ongoing 

or about to be committed and that the attorney-client 

communications were used in furtherance of that scheme. 

See In re Grand Jury, 475 F.3d 1299, 1305 (D.C. Cir. 2007); 

In re Grand Jury Proceedings #5 Empanelled January 28, 

2004, 401 F.3d 247, 251 (4th Cir. 2005); In re Grand Jury 

Investigation, 842 F.2d 1223, 1226–27 (11th Cir. 1987).

Our own statement of the proof necessary to apply the 

crime-fraud exception is not particularly helpful. We have 

consistently expressed the amount of proof required as 

follows: “A ‘prima facie showing’ requires presentation of 

‘evidence which, if believed by the fact-finder, would be 

sufficient to support a finding that the elements of the crimefraud exception were met.’” In re Grand Jury Subpoena, 223 

F.3d at 217 (quoting Haines v. Liggett Grp. Inc., 975 F.2d 81, 

95–96 (3d Cir. 1992)). This begs the quantum-of-proof

question because it does not quantify what evidence is 

sufficient. For example, does the trier of fact have to find that 

there is probable cause to believe a crime or fraud occurred or 

that it is more likely than not a crime or fraud occurred?
35

The question of what proof we require to overcome 

evidentiary privileges arises in this appeal. Although the 

District Court cited our traditional “sufficient to support” 

language, it also concluded that the Government had met its 

burden by establishing that there was a “reasonable basis to 

suspect” that ABC Corp. had committed a crime or fraud. 

ABC Corp. urges us to disavow this “reasonable basis to 

suspect” language, which it asserts reflects a far less stringent 

standard than our own “sufficient to support” test, and to 

remand this matter to the District Court so that it can analyze

whether the Government met its burden under the appropriate 

standard.

18

We have never held, however, that our crime-fraud

standard was significantly more demanding than the standards 

set out by other courts of appeals. To the contrary, we have 

cited approvingly the Seventh Circuit Court’s 

pronouncements that a party opposing the privilege meets its 

burden by introducing evidence sufficient to require the party 

asserting the privilege to come forward with an explanation, 

In re Impounded, 241 F.3d at 317 (citing In re Feldberg, 862 

F.2d 622, 626 (7th Cir. 1988)), and that “prima facie evidence 

cannot mean ‘enough to support a verdict in favor of the 

person making the claim,’” In re Grand Jury Investigation, 

445 F.3d 266, 275 (3d Cir. 2006) (quoting In re Feldberg, 

862 F.2d at 624). We have also stressed that “[t]he burden is 

not a particularly heavy one,” and that “demonstrating a 

reasonable basis to suspect the perpetration of a crime, if 

based on adequate evidence, satisfies the first prong of the 

crime-fraud exception.” Id. at 274-75; see also Haines, 975 

F.2d at 95 (approving the District Court’s determination that 

 

 18 We review legal conclusions—such as the amount of proof 

required to apply the crime-fraud exception—de novo. In re 

Impounded, 241 F.3d 308, 312 (3d Cir. 2001). 
36

the “probable cause” formulation and the “sufficient to 

support” standard “amount to the same basic proposition”).

Today, we clarify that our precedent is properly

captured by the reasonable basis standard. The attorneyclient privilege, work product doctrine, and crime-fraud 

exception are all compromises based on policy 

determinations. Although it is difficult to predict whether a 

particular standard of proof will strike the appropriate balance 

between these competing policy concerns, we believe, as do 

other circuit courts, that the reasonable basis standard affords 

sufficient predictability for attorneys and clients without 

providing undue protection to those that seek to abuse the 

privileges afforded to them. This is also the standard that we 

believe is closest to the Supreme Court’s pronouncement that,

for the crime-fraud exception to apply, “there must be 

something to give colour to the charge” that the attorneyclient communication was used in furtherance of a crime or 

fraud. Clark, 289 U.S. at 15.

Where there is a reasonable basis to suspect that the 

privilege holder was committing or intending to commit a 

crime or fraud and that the attorney-client communications or 

attorney work product were used in furtherance of the alleged 

crime or fraud, this is enough to break the privilege. The 

reasonable basis standard “is intended to be reasonably 

demanding; neither speculation nor evidence that shows only 

a distant likelihood of corruption is enough.” In re Grand 

Jury Proceedings, 417 F.3d at 23. At the same time, the party 

opposing the privilege is not required to introduce evidence 

sufficient to support a verdict of crime or fraud or even to 

show that it is more likely than not that the crime or fraud 

occurred. See id. at 22; In re Grand Jury Investigation, 445 

F.3d at 274–75. The reasonable basis standard is one with 

which courts are familiar, and we are confident that they will 
37

be able to apply it consistently to achieve the policy 

objectives of the privileges and the crime-fraud exception.

Perhaps recognizing that our precedent is amenable to 

the reasonable basis standard articulated by the District Court, 

ABC Corp. asks us to “modify the standard to establish 

crime-fraud by requiring the government to demonstrate by a 

preponderance of the evidence that the privilege has been 

employed to commit a crime or fraud.” Appellants’ Br. at 60. 

The Supreme Court’s decision in Bourjaily v. United 

States, 483 U.S. 171 (1987), provides some support for use of 

the preponderance-of-the-evidence standard. Federal Rule of 

Evidence 104(a) requires courts to “decide any preliminary 

question about whether a witness is qualified, a privilege 

exists, or evidence is admissible.” In Bourjaily, the Supreme 

Court held that factual predicates needed to determine the 

admissibility of hearsay evidence under Rule 801(d)(2)(E)

must be established by a preponderance of the evidence.19

Bourjaily, however, does not dictate that we apply a

preponderance-of-the-evidence standard in our case. The 

Supreme Court there was not interpreting the language of 

 

See 483 U.S. at 175–76. Because Rule 104(a) also applies to

preliminary factual determinations underlying application of

the crime-fraud exception, see Zolin, 491 U.S. at 565, it could 

be inferred that the same preponderance standard applies to

these determinations. 

 19 When Bourjaily was decided, Rule 104(a) provided in 

pertinent part: “Preliminary questions concerning the 

qualification of a person to be a witness, the existence of a 

privilege, or the admissibility of evidence shall be determined 

by the court. . . .” The Rule was amended as part of the 

restyling of the Federal Rules of Evidence in 2011.
38

Rule 104(a) or any other provision of the Federal Rules of 

Evidence. Instead, because “[t]he Federal Rules . . . nowhere 

define the standard of proof the court must observe in 

resolving these questions,” the Supreme Court was “guided 

by [its] prior decisions regarding admissibility determinations 

that hinge on preliminary factual questions.” Bourjaily, 483 

U.S. at 175. We are guided by the same inquiry here. 

Neither our own nor Supreme Court precedent 

suggests that a preponderance-of-the-evidence standard is 

necessary to protect the policy concerns underlying the crimefraud exception. To the contrary, we have found that these 

policy concerns, which differ from those attending

evidentiary admissibility, are appropriately protected by a 

lower standard. This is particularly true in the grand jury 

context, where the need for speed, simplicity, and secrecy 

weighs against imposing a crime-fraud standard that would 

require adversarial hearings or the careful balancing of 

conflicting evidence.

20

 20 The Ninth Circuit has held that the preliminary factual 

determinations necessary for application of the crime-fraud 

exception should be determined by a preponderance of the 

evidence in the civil litigation context. See In re Napster, Inc. 

Copyright Litig., 479 F.3d 1078, 1094–95 (9th Cir. 2007),

abrogated on other grounds by Mohawk, 558 U.S. 100, 130 

S. Ct. 599 (2009). But that Court made clear that it would 

continue to apply its “reasonable cause” standard to grand 

jury investigations. Id. at 1094. We suggest here no view as 

to whether a higher standard should be applied in the civil 

litigation context.

See In re Impounded, 241 F.3d at 313 

(“‘Any holding that would saddle a grand jury with minitrials 

and preliminary showings would assuredly impede its 

investigation and frustrate the public’s interest in the fair and 
39

expeditious administration of the criminal laws.’” (quoting 

United States v. Dionisio, 410 U.S. 1, 17 (1973)); In re 

Napster, 479 F.3d at 1094-95 (“[C]ourts of appeal have noted 

that the need for speed and simplicity at the grand jury stage 

weighs against a crime-fraud standard that requires courts to 

hear testimony or to determine facts from conflicting 

evidence before making a crime-fraud determination.” 

(quotation marks and citations omitted)). Accordingly, we do 

not adopt a preponderance-of-the-evidence test as the proof 

necessary to apply the crime-fraud exception.

B.

ABC Corp. asserts that, regardless of the proof 

required, the District Court erred in determining that the 

Government satisfied its burden. As just discussed, a party 

seeking to apply the crime-fraud exception must demonstrate 

that there is a reasonable basis to suspect (1) that the privilege 

holder was committing or intending to commit a crime or 

fraud, and (2) that the attorney-client communication or 

attorney work product was used in furtherance of that alleged 

crime or fraud. We review the District Court’s decision that 

“there is sufficient evidence of a crime or fraud to waive the 

attorney-client privilege” for “abuse of discretion.” In re 

Impounded, 241 F.3d at 318 (citations omitted). We review 

factual determinations underlying that decision for clear error. 

Id. at 312.

Crime-Fraud Exception: Satisfaction of Government’s 

Burden 

21

 21 ABC Corp. requests that we change our standard of review 

to de novo for all factual issues underlying application of the 

attorney-client privilege, work product doctrine, and crimefraud exception. As the Government points out, and ABC 

Corp. accepts in its Reply Brief, we are bound by our own 
40

1. Commission of a Crime or Fraud

The District Court found that the evidence submitted 

ex parte by the Government provided a reasonable basis to 

suspect that ABC Corp. willfully evaded paying federal 

income taxes in violation of 26 U.S.C. § 7201 and engaged in 

a conspiracy to defraud the United States of federal income 

taxes in violation of 18 U.S.C. § 371.22

 

precedent unless it has been overruled by Supreme Court 

decision or we are sitting en banc. In re Lemington Home for 

the Aged, 659 F.3d 282, 294 n.6 (3d Cir. 2011). Moreover, 

we voice no opinion on whether the standard of review 

should be changed.

 This scheme, which 

22 Under 26 U.S.C. § 7201, “[a]ny person who willfully 

attempts in any manner to evade or defeat any tax imposed by 

this title or the payment thereof shall . . . be guilty of a 

felony.” To establish a violation of § 7201, the government 

must prove “(1) willfulness, (2) the existence of a tax 

deficiency, and (3) an affirmative act constituting an evasion 

or attempted evasion of the tax.” United States v. Hecht, 638 

F.2d 651, 659 (3d Cir. 1981) (Weis, J., dissenting) (citing 

Sansone v. United States, 380 U.S. 343, 351 (1965)). Under 

18 U.S.C. § 371, “[i]f two or more persons conspire to . . .

defraud the United States . . . and one or more of such persons 

do any act to effect the object of the conspiracy, each shall be 

fined . . . or imprisoned . . . or both.” In order to prove a 

conspiracy to defraud the United States, the evidence must 

establish “(1) an agreement to defraud the United States, (2) 

an overt act by one of the conspirators in furtherance of that 

objective, and (3) any conspirator’s commission of at least 

one overt act in furtherance of the conspiracy.” United States 
41

occurred between 2004 and 2006, unfolded in two phases. In 

the acquisition phase, ABC Corp. acquired the stock of 

closely held companies. The target companies generally had 

large cash accounts, few or no tangible assets, and 

considerable tax liabilities. In the disposition phase, ABC 

Corp. would remove significant amounts of the target 

companies’ cash assets, transfer the stock of the target 

companies to two limited liability companies, and engage in 

various transactions that had the effect, it is alleged, of 

fraudulently eliminating the target companies’ tax liability. 

Having done so, John Doe 1 and John Doe 2 would then 

divert the target companies’ cash assets to themselves and 

their family members. 

Our discussion of the District Court’s findings is 

necessarily abridged because of the secrecy of grand jury 

proceedings. As noted, we received unredacted versions of 

the District Court’s March and June Orders and ex parte

submissions from the Government. Having reviewed these

materials, we cannot say that the District Court’s detailed

factual findings constituted clear error or that it abused its 

discretion in determining that there was a reasonable basis to 

suspect that ABC Corp. was engaged in a criminal scheme.

23

 

v. McKee, 506 F.3d 225, 238 (3d Cir. 2007) (citing United 

States v. Rankin, 870 F.2d 109, 113 (3d Cir. 1989)). 

23 ABC Corp. argues that the District Court erred in declining 

to hold a hearing and in refusing to require the Government to 

disclose some or all of its ex parte submissions to ABC Corp. 

Because grand juries are investigative rather than adversarial 

bodies, and because of the need for secrecy, we have 

generally held that district courts have considerable discretion 

to select among “various avenues of inquiry” in the grand 
42

ABC Corp. cites four recent decisions of the United 

States Tax Court in support of its assertion that the District 

Court mistakenly found that the Government satisfied its 

burden in establishing that ABC Corp. committed a crime or 

fraud. See Slone v. Comm’r, 103 T.C.M. (CCH) 1265 (2012); 

Frank Sawyer Trust v. Comm’r, 102 T.C.M. (CCH) 623 

(2011); Starnes v. Comm’r, 101 T.C.M. (CCH) 1283 (2011),

 

jury context. In re Grand Jury Subpoena, 223 F.3d at 219; 

see also id. (“We today join the ranks of our sister circuits in 

holding that it is within the district courts’ discretion, and not 

violative of due process, to rely on an ex parte government 

affidavit to determine that the crime-fraud exception applies 

and thus compel a target-client’s subpoenaed attorney to 

testify before the grand jury.”); In re Grand Jury Empaneling 

of Special Grand Jury, 171 F.3d 826, 833-34 (3d Cir. 1999) 

(“Neither Supreme Court precedent nor our prior decisions 

require that a hearing be held whenever a subpoena is 

challenged on reasonableness grounds. Indeed, this court has 

specifically rejected any such suggestion, leaving the decision 

to hold a hearing to the district court’s discretion.”). The 

District Court refused to require the Government to disclose 

its ex parte submissions because they contained secret grand

jury information and declined to hold a hearing because the 

Court did not think it would be useful given the parties’ 

divergent access to the relevant evidence. Instead, it granted 

ABC Corp. access to redacted versions of the Government’s 

briefing, provided ABC Corp. with the opportunity to make 

its own submissions, and conducted a careful and probing in 

camera review of the parties’ evidentiary submissions. We 

cannot say that the Court abused its discretion, or denied 

ABC Corp. due process, in determining the applicability of 

the crime-fraud exception on this basis.
43

aff’d, 680 F.3d 417 (4th Cir. 2012); Griffin v. Comm’r, 101 

T.C.M. (CCH) 1274 (2011). In each of these cases, the Tax 

Court held that company shareholders were not liable for tax 

deficiencies incurred by their respective companies after they 

were sold to third parties. ABC Corp. argues that it is in the 

same position as the selling shareholders in Slone, Frank 

Sawyer Trust, Starnes, and Griffin, and thus cannot be 

responsible for the allegedly fraudulent transactions that 

occurred after it sold the target companies.

We do not agree that these decisions preclude 

application of the crime-fraud exception. As an initial matter, 

the District Court and the Tax Court applied different 

statutory provisions in distinct contexts. The latter

determined whether the shareholders could be held liable as 

transferees under 26 U.S.C. § 6901—which requires 

application of substantive state law—for tax deficiencies 

incurred after the sale of the relevant company. The District 

Court, in contrast, analyzed whether there was a reasonable 

basis to suspect that ABC Corp. willfully evaded paying 

federal income taxes in violation of 26 U.S.C. § 7201 and

engaged in a conspiracy to defraud the United States of 

federal income taxes in violation of 18 U.S.C. § 371. 

In addition, the Tax Court’s decisions depended on 

fact-specific analyses—which included detailed reviews of 

the transactions at issue, the roles of the shareholders, and 

their knowledge of the fraudulent transactions. We are 

limited in our ability to discuss the facts of the alleged 

criminal scheme that the grand jury is investigating. But it 

will not disclose too much for us to say that the Government’s 

submissions provide sufficient support for the inference that 

ABC Corp. played a considerably different role in the alleged 

criminal scheme than the shareholders in Slone, Frank 

Sawyer Trust, Starnes, and Griffin played in those 

transactions.
44

2. Use of Attorney Advice in Furtherance of the

Crime or Fraud

On the basis of its crime-fraud finding, the District 

Court ordered the three in-house counsel to answer all 

questions concerning transactions involving companies that 

ABC Corp. purchased and subsequently transferred to the two 

limited liability companies implicated in the alleged criminal 

scheme.24

We do not think that the District Court’s factual 

findings were clear error or that it abused its discretion in 

determining that there is a reasonable basis to suspect that 

ABC Corp. used the legal advice it obtained in connection 

with these transactions to further its criminal scheme. For the 

crime-fraud exception to apply, the attorney does not have to 

be implicated in the crime or fraud or even have knowledge 

of the alleged criminal or fraudulent scheme. In re Grand 

Jury Investigation, 445 F.3d at 279 n.4. All that is necessary 

is that the client misuse or intend to misuse the attorney’s

Although the fraudulent tax transactions took 

place in the disposition phase, the District Court determined 

that the acquisition phase was also an essential component of 

the alleged criminal scheme. The alleged purpose of the

criminal enterprise was to divert large sums of money to John 

Doe 1, John Doe 2, and their relatives. Acquiring cash-rich 

targets with large tax liabilities was therefore a necessary

precursor to achieving that objective. Accordingly, the 

District Court ordered the in-house counsel to answer 

questions regarding all phases of the transactions.

 24 The District Court also determined that the crime-fraud 

exception vitiated any privilege ABC Corp. had over a 2004 

opinion letter that ABC Corp. obtained from outside counsel. 

The District Court’s ruling with respect to this document is 

addressed below. See infra Part IV.D.1.
45

advice in furtherance of an improper purpose. Id. at 279–80. 

When this occurs, the purpose of the privilege, to promote the 

fair administration of justice, has been undermined and the 

privilege no longer applies. Id. 

The District Court found that there is a reasonable 

basis to suspect that ABC Corp. was engaged in a large-scale 

criminal scheme that consisted of multiple phases. Although 

ABC Corp. suggests that there is no evidence implicating its 

former in-house counsel in the allegedly fraudulent 

transactions that occurred in the disposition phase of the 

scheme, because it is the criminal intent of the client and not 

its attorneys that matters, it is irrelevant whether the in-house 

counsel were only engaged in the scheme’s initial phases. If 

the acquisition phase was a critical component of the criminal 

enterprise (as the District Court found), any legal advice that 

ABC Corp. obtained to further those acquisitions was used 

for an improper purpose and is not entitled to any protection 

otherwise afforded by the attorney-client privilege or work 

product doctrine. 

In an effort to undermine the District Court’s rulings, 

ABC Corp. asserts that it presented evidence to the District 

Court demonstrating that the in-house counsel’s legal services 

were not used in furtherance of any crime or fraud. 

Specifically, ABC Corp. points to sworn declarations of one 

of the in-house counsel and John Doe 1 purportedly

“demonstrat[ing] that there were no circumstances where 

[ABC Corp.] consulted an attorney and then engaged in a 

course of action that was fraudulent or criminal.” Appellants’ 

Br. at 65. 

These declarations do not alter our conclusion that the 

District Court did not commit reversible error. Although the 

in-house counsel testified that he provided a variety of legal 

services for ABC Corp. in connection with its acquisition of 
46

closely held corporations, he did not indicate one way or the 

other whether he believed these transactions were part of a 

larger criminal scheme. In any event, even if he were entirely 

ignorant of such a scheme, this would not put the crime-fraud 

exception out of play. 

The declaration of John Doe 1 is equally unpersuasive. 

He testified that, to the best of his knowledge, information, 

and belief, ABC Corp. never sought advice from an attorney 

that was then used to commit a crime or a fraud. While this 

evidence is not necessarily irrelevant, the District Court was 

hardly required to credit this bald statement of innocence 

from a grand jury subject or to determine that it outweighed 

the substantial evidence submitted by the Government. 

C.

ABC Corp. asserts that even if the District Court was 

correct in applying the crime-fraud exception to strip the 

protection conferred by the attorney-client privilege, the 

exception does not affect the cover conferred by the work 

product doctrine because there is no evidence that the 

attorneys knew of the alleged criminal scheme. 

Application of Crime-Fraud Exception to the Work 

Product Doctrine

We have left open the possibility that “there may be 

circumstances in which [an] attorney, without knowledge of 

his client’s illegal activity, might . . . properly claim and 

prevail in asserting a work product privilege” even when his 

client cannot. In re Grand Jury Proceedings, 604 F.2d at 802 

n.5. Because the work product doctrine protects the interests 

of attorneys separately from the interests of clients, there is at 

least some basis for the proposition that an innocent attorney 

should be able to prevent disclosure of work product that his 

client used to further a crime or fraud. Accordingly, other 

courts of appeals have afforded attorneys this protection in 
47

appropriate circumstances. See, e.g., In re Green Grand Jury 

Proceedings, 492 F.3d 976, 980 (8th Cir. 2007); In re Grand

Jury Proceedings #5, 401 F.3d at 252–53.

We continue, however, to leave for another day

whether we should join these courts. None of the in-house 

counsel has appealed the District Court’s June Order. Indeed, 

the in-house counsel would likely need to disobey that Order 

for us to have jurisdiction over their purported work product 

claims. In the absence of their doing so, we cannot properly 

assess the existence and parameters of their independent

interests in resisting disclosure of information.

D.

ABC Corp. challenges the District Court’s rejection of 

its privilege claims with respect to five documents in the 

possession of ABC Corp.’s former in-house counsel. As 

noted, we review legal issues underlying the application of 

the attorney-client privilege or work product doctrine de novo

and review factual findings underlying the application of 

these privileges for clear error. In re Chevron Corp., 633 

F.3d at 161. 

The District Court’s Document Rulings
48

1. Two Copies of Opinion Letter Prepared by ABC 

Corp.’s Outside Counsel

This document is a 2004 opinion letter prepared by 

ABC Corp.’s outside counsel relating to the allegedly 

fraudulent transactions investigated by the grand jury. Two

of the in-house counsel are in possession of this document. 

The only difference between the copies in their possession is 

that one includes handwritten notes. The District Court 

determined that any protection afforded by the attorney-client 

privilege or work product doctrine to the opinion letter was 

extinguished by the crime-fraud exception. 

ABC Corp. raises two challenges to this ruling. First, 

it argues that the District Court erred in reversing its previous 

ruling rejecting the Government’s claim that the opinion letter

was used in furtherance of the alleged tax crimes. In its 

March Order, the Court ruled that the Government failed to 

carry its burden of introducing prima facie evidence that the

opinion was used in furtherance of the alleged tax crimes. 

Specifically, the Court found there was no evidence that the 

letter was scripted to provide ABC Corp.’s principals with 

legal support to defend the allegedly fraudulent transactions if 

they were later questioned by the authorities. In its June 

Order, the Court changed its ruling on the basis of evidence 

newly obtained by the Government—an interview 

memorandum it submitted ex parte and under seal. Though 

we are unable to discuss the content of this witness summary, 

we have reviewed it and see no abuse of discretion in the

Court’s determination that it provides a reasonable basis to 

suspect that ABC Corp. used the legal advice contained in the 

opinion letter to further the alleged criminal tax scheme. 

Second, ABC Corp. claims that the handwritten notes 

on one of the copies of the opinion letter should be protected 

from disclosure as attorney work product because no 
49

evidence exists implicating the author of the note—

presumably the counsel—in the alleged criminal scheme. As

ABC Corp. never raised this issue before the District Court, it 

has waived the opportunity to raise it on appeal. See United 

States v. Williams, 510 F.3d 416, 430 (3d Cir. 2007); Franki 

Found. Co. v. Alger-Rau & Assocs., Inc., 513 F.2d 581, 586 

(3d Cir. 1975). Moreover, as we have already noted, the inhouse counsel have not appealed the District Court’s June 

Order. 

2. Email Chain Containing Communications Between 

ABC Corp.’s Outside Counsel and a Target 

Company’s Outside Counsel

This document is an email chain. The first message in 

the chain is between outside counsel representing ABC Corp. 

and outside counsel representing one of the target companies

it purchased. In this message, counsel for the target company 

(1) asks where to transfer certain business records, including 

records pertaining to patents, of the target corporation, (2) 

asserts that the target company was not required to undertake 

any maintenance responsibilities related to those patents, and 

(3) inquires whether outside counsel prepared a transaction 

binder related to the purchase. The second message in the 

chain is between ABC Corp.’s outside counsel and one of 

ABC Corp.’s former in-house counsel. In that message, the 

outside counsel forwards the first email with the request to 

“[p]lease see . . . email below. Per my voicemail, please 

advise me as to what you would like us to do.” Because the 

in-house counsel was no longer employed by ABC Corp., the 

remainder of the chain consists of communications discussing 

with whom at ABC Corp. the outside counsel could 

communicate about the matter. The District Court 

determined that none of these communications was protected 

by the attorney-client privilege.
50

As we have explained, that privilege

applies to any communication that 

satisfies the following elements: it 

must be “(1) a communication (2) 

made between privileged persons 

(3) in confidence (4) for the 

purpose of obtaining or providing 

legal assistance for the client.” 

“Privileged persons” include the 

client, the attorney(s), and any of 

their agents that help facilitate 

attorney-client communications or 

the legal representation. 

In re Teleglobe, 493 F.3d at 359 (quoting Restatement (Third) 

of the Law Governing Lawyers §§ 68, 70 (2000)).25

 25 See also In re Impounded, 241 F.3d at 316 n.6 

(“Communications are protected under the attorney-client 

privilege when: (1) legal advice of any kind is sought (2) 

from a professional legal advisor in his capacity as such, (3) 

the communications relating to that purpose, (4) made in 

confidence, (5) by the client, (6) are at his insistence 

permanently protected (7) from disclosure by himself or by 

the legal advisor, (8) except the protection [may] be waived.” 

(citation omitted)).

“To the 

extent that the record is ambiguous as to the elements which 

are necessary to establish the claim of privilege, ‘the burden 

of proving that the attorney-client privilege applies is placed 

upon the party asserting the privilege.’” In re Grand Jury 

Empanelled February 14, 1978, 603 F.2d 469, 474 (3d Cir. 
51

1979) (alterations omitted) (quoting United States v. Landof, 

591 F.2d 36, 38 (9th Cir. 1978)). 

The second email in the chain contains the only 

communication that is arguably privileged. According to 

ABC Corp., this email “plainly involves a request for legal 

advice” because “one attorney is asking the other attorney 

how to prepare for one of the acquisitions at issue.” 

Appellants’ Reply at 27 (Sept. 10, 2012). We disagree. It is 

at best ambiguous whether the communication is a request for 

legal advice (e.g., how ABC Corp. wants to respond to the 

target company’s assertion that it is not responsible for 

maintaining certain patents) or is a purely administrative

request (e.g., where the business records should be transferred 

and whether a binder has been made). Because ABC Corp.

bears the burden of demonstrating that the privilege applies, 

and it has provided no support for its assertion that this was a 

request for legal advice, we cannot say that the District Court 

erred in finding that this email lacks a privilege protection.

3. Two Documents Containing Communications 

Between John Doe 1 and ABC Corp.’s In-House 

Counsel

These documents contain communications between 

one of ABC Corp.’s former in-house counsel and John Doe 1

pertaining to matters involving the wind-up of ABC Corp.’s 

affairs. ABC Corp. argues that they “do not pertain to any 

specific transaction engaged in by [ABC Corp.] during its 

operations and therefore cannot be considered to be in 

furtherance of any crime or fraud.” Appellants’ Br. at 72. 

Whatever the merits of this argument, the District Court did 

not order disclosure of the documents on the basis of its 

crime-fraud ruling, but rather because of its determination 

that the communications do not contain legal advice protected 

by the attorney-client privilege. ABC Corp. does not make 
52

any argument why this ruling was incorrect, and, even absent 

this waiver, we see none. We accordingly affirm the District 

Court’s ruling as to these two documents.

V. Conclusion

We summarize our holdings. 

1. ABC Corp. has standing to contest the grand jury 

subpoenas because it claims privilege in the sought-after 

documents and testimony. John Doe 1 and John Doe 2, in 

contrast, lack standing because they are not privilege holders,

and do not have any other legally cognizable interest in the 

documents or testimony. 

2. Even though ABC Corp. has standing, we lack

jurisdiction to hear its appeal from the March Order because 

ABC Corp. may travel the well-worn contempt path to 

jurisdiction. If ABC Corp. wishes to appeal this Order

immediately, it must take possession of its documents from 

Blank Rome, refuse to produce them to the Government, and 

appeal any resulting contempt sanctions. Because the parties 

have been unable to agree on a mechanism for transferring 

the documents, we lift the stay to allow the District Court to 

effect an appropriate transfer. In doing so, the Court, if it 

wishes, may designate a representative of ABC Corp. to 

receive delivery of the documents or direct ABC Corp. to do 

so. 

3. We have jurisdiction to hear the appeal by ABC 

Corp. from the June Order because that Order is not directed 

to it and its former employees are unlikely to risk contempt 

sanctions on its behalf. Contrary to the Government’s 

suggestion, we decline to hold that the Supreme Court’s 

decision in Mohawk Industries, Inc. v. Carpenter, 558 U.S. 
53

100, 130 S. Ct. 599 (2009), precludes Perlman appeals by 

grand jury subjects.

4. Finally, in reaching the merits of ABC Corp.’s

appeal from the June Order, we hold that the Court correctly 

(a) applied the crime-fraud exception to deny ABC Corp. a 

privilege protection over testimony and two documents 

sought from its former in-house counsel and (b) determined 

that three documents sought from those counsel do not 

qualify as privileged.

In this context, we dismiss the appeals by John Doe 1 

and John Doe 2 for lack of standing, dismiss the appeal by

ABC Corp. from the March Order for lack of jurisdiction, and 

affirm the June Order.

26 

 26 For the sake of judicial economy, we have directed the 

Clerk to assign to this panel any further appeals in this matter.
VANASKIE, Circuit Judge, concurring in part and dissenting

in part. 

I agree with the majority that John Doe 1 and John 

Doe 2 lack standing to challenge on the basis of the attorneyclient privilege or work product doctrine the District Court’s 

disclosure orders, because neither individual can claim the 

protection of either exemption from disclosure. I also agree 

that we lack jurisdiction to review the District Court’s March 

2012 Order (the “March Order”) to the extent that it requires 

production directly by ABC Corporation (“ABC”), because 

ABC may obtain appellate jurisdiction over that portion of the 

March Order by refusing to produce the contested documents 

and standing in contempt. 1

 1 ABC argues that the District Court included ABC in 

its order by mistake and that the District Court intended to 

require production only by the law firms. I agree with the 

majority, however, that if ABC wishes to make this argument 

on appeal, it must first stand in contempt.

I also am in complete accord with 

the majority’s holdings that we do have jurisdiction over 

ABC’s appeal from the District Court’s June 2012 Order (the 

“June Order”), which compels former in-house counsel of 

ABC to produce certain documents claimed to be protected 

from disclosure by ABC because the former in-house lawyers 

have no stake in the controversy sufficient to prompt them to 

risk contempt of court sanctions, and the only recourse 

available to ABC is a direct appeal of the June Order. 

Finally, I agree that the District Court correctly applied the 

crime-fraud exception to the attorney-client privilege in 

ordering production of certain documents by former in-house 

counsel. I write separately, however, because I believe that 

we have jurisdiction over ABC’s appeal from the March 
2

Order to the extent that it requires production by ABC’s 

outside lawyers – Blank Rome LLP (“Blank Rome”) and 

LaCheen, Wittels & Greenberg, LLP (“LaCheen Wittels”). I 

would instead reach the merits of both Orders, and I would 

affirm the District Court to the extent it ordered production of 

the documents in question by both outside and former inhouse counsel. 

I. Jurisdiction

A. The Perlman Doctrine

As discussed in the majority’s opinion, a witness 

ordered to produce documents before a grand jury may not 

ordinarily bring an interlocutory appeal challenging the order 

requiring production. See In re Grand Jury Proceedings 

(FMC Corp.), 604 F.2d 798, 800 (3d Cir. 1979). To obtain 

review, the witness must instead stand in contempt and appeal 

the contempt order. Id. 

The Supreme Court, however, carved out an exception, 

known as the Perlman doctrine, permitting privilege holders 

to bring interlocutory appeals of orders requiring production 

by third-party custodians. See Perlman v. United States, 247 

U.S. 7, 15 (1918); see also In re Grand Jury Proceedings 

(Cianfrani), 563 F.2d 577, 580 (3d Cir. 1977); In re Grand 

Jury Proceedings (FMC Corp.), 604 F.2d at 800; In re Grand 

Jury, 111 F.3d 1066, 1076-77 (3d Cir. 1997); In re Grand 

Jury, 286 F.3d 153, 157 (3d Cir. 2002). The Perlman

doctrine rests on the premise that a non-subpoenaed privilege 

holder does not have the option of standing in contempt to 

obtain jurisdiction over an order directing production by a 

third-party custodian, because the order is not directed to the 
3

privilege holder. See In re Grand Jury (C. Schmidt & Sons, 

Inc.), 619 F.2d 1022, 1024-25 (3d Cir. 1980); In re Grand 

Jury, 111 F.3d at 1077. Moreover, a third-party custodian in 

possession of subpoenaed documents will more likely comply 

with a district court’s order than stand in contempt to protect 

the privilege holder’s rights. See In re Grand Jury 

Proceedings (Cianfrani), 563 F.2d at 580. Because the 

privilege holder cannot stand in contempt or force the thirdparty custodian to stand in contempt, the privilege holder 

becomes effectively “powerless to avert the mischief of the 

[district court’s] order.” Perlman, 247 U.S. at 13. To prevent 

this result, we have held that a district court order requiring 

production by a third-party custodian is final as to the 

privilege holder, and permit the privilege holder to take 

immediate appeal pursuant to 28 U.S.C. § 1291. See In re 

Grand Jury (C. Schmidt & Sons, Inc.), 619 F.2d at 1025 

(“[W]hen a party, other than the one to whom a subpoena has 

been addressed, moves to quash the subpoena, the denial of 

his motion disposes of his claim fully and finally.”) (citations 

omitted).

Applying the logic of Perlman to this appeal, I agree 

with the majority that ABC cannot appeal the portion of the 

District Court’s March Order requiring ABC itself to produce 

the documents directly. ABC is an ordinary subpoenaed 

party, rather than a privilege holder challenging production by 

a third-party, with respect to the portion of the District 

Court’s March Order requiring that it produce certain 

documents. It must therefore stand in contempt to confer 

jurisdiction over this part of the District Court’s order. See In 

re Grand Jury Proceedings (FMC Corp.), 604 F.2d at 800.
4

In my view, however, the portions of the District 

Court’s March Order requiring production by the law firms 

are a different matter. With respect to the portions 

concerning the law firms, ABC is the purported privilege 

holder challenging a district court order requiring production 

by third-party custodians. ABC cannot stand in contempt of 

the District Court’s order as to the law firms, because that 

part of the order is not directed to ABC. See In re Grand Jury 

(C. Schmidt & Sons, Inc.), 619 F.2d at 1024-25. ABC is thus 

more or less in the same position as were the privilege holders 

in the long line of cases in which we have applied the 

Perlman doctrine – ABC’s only effective recourse is a direct 

appeal of the order requiring third-party custodians to 

produce purportedly privileged records. Indeed, I see no 

meaningful distinction between the March and June Orders to 

the extent that they both compel production of purportedly 

privileged documents in the custody of parties other than 

ABC. 

B. Effect of the Order Against ABC Corporation 

The majority distinguishes this appeal principally on 

the grounds that both the law firms and ABC are subject to 

the District Court’s order requiring production. Therefore, in 

the majority’s view, ABC can obtain immediate appellate 

review by demanding that the law firms return the documents 

to it and by incurring a contempt sanction. The majority’s 

argument rests, in part, on its assertion that if ABC can appeal 

under Perlman, then any client will be able to bring an 

interlocutory appeal by giving its documents to its law firm.

I cannot agree with the majority’s logic. The purpose 

of the Perlman doctrine is to enable a privilege holder to 
5

appeal an order requiring production when he or she “‘lacks 

the opportunity to contest the subpoena by disobedience 

because it is not directed to him or her.’” In re Grand Jury, 

111 F.3d at 1077 (quoting In re Grand Jury Matter (Dist. 

Council 33 Health & Welfare Fund), 770 F.2d 36, 38 (3d Cir. 

1985)). That is exactly the situation that we now face with 

respect to the orders compelling production of the contested 

documents by the law firms. Because Blank Rome, rather 

than ABC, has physical custody of the documents, ABC 

cannot unilaterally stand in contempt. Regardless of ABC’s 

intent to stand in contempt, Blank Rome can comply with the 

District Court’s order and produce the documents.

I disagree that ABC has the option of obtaining

jurisdiction by taking physical custody of the documents and 

refusing to produce them to the Government. Although the 

majority rules out the possibility of the Government charging

the law firms with obstruction of justice, it cannot rule out the 

possibility that the District Court will hold the law firms in 

contempt. The Government subpoenaed the law firms 

individually and moved to compel them to produce the 

documents. The District Court issued an order requiring 

production by the law firms directly. Transferring the 

documents to ABC will not negate the law firms’ duty to 

comply with the District Court’s order. See Couch v. United 

States, 409 U.S. 322, 329 n.9 (1973) (“The rights and

obligations of the parties bec[o]me fixed when [a] summons 

[is] served, and [a post-summons document] transfer [does]

not alter them.”) (citations omitted); In re Grand Jury 

Empanelled, 597 F.2d 851, 865 (3d Cir. 1979) (holding that 

an employer cannot defeat a subpoena served on its employee 

by taking the requested documents from the employee and 

claiming that the documents are no longer in the employee’s 
6

possession); United States v. Asay, 614 F.2d 655, 660 (9th 

Cir. 1980) (stating that a recipient of a summons cannot 

defeat the summons by relinquishing possession of the 

requested documents); United States v. Three Crows Corp., 

324 F. Supp. 2d 203, 206 (D. Me. 2004) (“[T]he law does not 

allow a custodian of records to send [the requested 

documents] away after receiving a summons and then claim 

he cannot produce them, because they are no longer in his 

possession.”). Accordingly, if the law firms ignore the 

District Court’s order and instead turn over the documents to 

ABC, they will be just as much in contempt as ABC. See

Nilva v. United States, 352 U.S. 385, 392 (1957) (“[A]

criminal contempt is committed by one who, in response to a 

subpoena calling for corporation or association records, 

refuses to surrender them when they are in existence and 

within his control.”) (citations omitted); Fed. R. Crim. P. 

17(g) (“The court . . . may hold in contempt a witness who, 

without adequate excuse, disobeys a subpoena issued by a 

federal court in that district.”); 28 U.S.C. § 1826(a)

(authorizing civil contempt sanctions when “a witness . . . 

refuses without just cause shown to comply with an order of 

the court to testify or provide other information”).

This matter was returned to the District Court with the 

understanding that the parties would be able to reach an 

agreement on a way to transfer the contested documents to 

ABC that would avoid the law firms being found in contempt. 

The inability of the parties to reach agreement on a 

mechanism for the transfer of the documents in question to 

the defunct corporation, coupled with the Government’s 

unwillingness to forego contempt sanctions against the law 

firms, illustrates why jurisdiction should be found to exist in 

relation to the District Court directives requiring production 
7

by the law firms. There is no effective mechanism to avoid 

the problem that Perlman resolves: the release of privileged 

documents by a disinterested custodian who is understandably 

unwilling to suffer contempt sanctions to protect a privilege 

held by another.

The Government’s reluctance to agree to a document 

transfer is not surprising. The Government wants a 

meaningful contempt sanction, one that threatens an 

individual with imprisonment or hefty monetary penalties. 

But ABC is defunct and no individual has thus far appeared to 

take on the dubious responsibility of suffering contempt to 

protect the attorney-client privilege.

In large measure, the problem presented in this case is 

attributable to the fact that ABC, the privilege holder, is no 

longer active and has no person within the jurisdiction of the 

District Court to whom the documents can be transferred. It 

is not a sufficient answer to the conundrum created by the fact 

that ABC is defunct to place the matter in the very capable 

hands of the District Court and say you come up with “an 

appropriate mechanism for transferring the documents from 

Blank Rome to ABC Corp.” (Majority Op., typescript at 23.) 

Nor is it sufficient to say that there must be some person who 

has decided to assert the privilege, and that person should be 

designated to receive the documents and suffer contempt 

sanctions. No such person within the jurisdiction of the 

District Court has yet been identified, and the Government 

certainly would not agree to a transfer of the documents to a 

person who is not subject to the District Court’s jurisdiction. 

It is this inability to identify a person who could be held in 

contempt that makes the Perlman doctrine particularly 

applicable here.
8

Nor does the fact that the law firms are ABC’s agents, 

and thus have a duty to return the documents to ABC upon 

ABC’s demand, alter the result. Although I agree in general 

that a client can require his or her attorney to return 

documents, I disagree that ABC can do so in light of the 

District Court’s order. A client generally cannot require his 

or her attorney to violate a district court order to protect his or 

her privilege. An attorney, after asserting all non-frivolous 

objections to producing client confidences, may ethically 

comply with a court order requiring production. See Model 

Rules of Prof’l Conduct R. 1.6(6) & cmt. 13 (2010); Pa. Rules 

of Prof’l Conduct R. 1.6 cmt. 19 (2012); see also In re Grand 

Jury Proceedings in Matter of Fine, 641 F.2d 199, 202 (5th 

Cir. 1981) (stating that an attorney may ethically reveal client 

confidences pursuant to a court order). Because the District 

Court’s order requires the law firms to produce the 

documents, ABC cannot force the law firms to instead return 

the documents to it.

Moreover, I disagree that applying Perlman when the 

privilege holder is also subject to the District Court’s order 

will enable any client to take a Perlman appeal by turning 

over all documents to his or her attorney. As the majority 

agrees, the Government may request documents by subpoena 

that are subject to the subpoena recipient’s legal control. See 

In re Grand Jury, 821 F.2d 946, 951 (3d Cir. 1987) (“A 

party’s lack of possession or legal control over documents 

requested by a subpoena is normally a valid defense to a 

subpoena and justification for a motion to quash.”). As the 

Government appears to agree, a client maintains control over 

documents that he or she turns over to his or her current 

attorney, because the client may ordinarily request the 
9

documents’ return. (Appellee’s Br. 16) (“[T]he subjects [of 

the grand jury investigation] do not suggest that the privilegeholder corporation no longer has the ability to obtain its 

documents from [its lawyer].”); see also Mercy Catholic Med. 

Ctr. v. Thompson, 380 F.3d 142, 160 (3d Cir. 2004) (holding 

that control under Fed. R. Civ. P. 34(a) is “the legal right or 

ability to obtain the documents from another source upon 

demand”). In the majority of future cases, the Government 

will be able to avoid a Perlman appeal by subpoenaing 

records solely from the privilege holder and obligating the 

privilege holder to request his or her attorney to produce the 

documents. Perlman jurisdiction exists in this instance 

because the Government chose to subpoena the law firms 

directly in possession of the documents, thereby subjecting 

them to possible contempt sanctions should they refuse to 

comply. 

I am also concerned that the majority’s rule will 

effectively eviscerate the Perlman doctrine in all instances 

where, as here, the privilege holder can direct the custodian to 

produce the subpoenaed documents, but cannot necessarily 

prevent the custodian from releasing the documents in the 

event a court orders production. In such cases, the 

Government will have every incentive to subpoena both the 

privilege holder and the custodian, obtain orders against both, 

and use the order against the privilege holder to artificially 

prevent the privilege holder from taking a Perlman appeal. 

Creating such a loophole, in my view, is inconsistent with our 

Court’s interpretation of Perlman as enabling privilege 

holders to obtain jurisdiction when they cannot obtain 

jurisdiction by standing in contempt.
10

Finally, I am constrained to note that this jurisdictional 

puzzle involving a defunct corporation that has been 

subpoenaed to produce documents held by its law firms has 

tied this matter up for months. Notably, the June Order, 

because ABC is not subject to it, is immediately reviewable 

under Perlman, but the March Order is still unreviewable 

until procedural hurdles are surmounted. I believe, 

admittedly with the benefit of hindsight, that the Government 

has unwittingly caused a lengthy delay in the grand jury 

proceedings by trying to end-run the Perlman doctrine by 

having both the law firms and ABC be the subjects of the 

disclosure order. Interests of judicial economy and speedy 

grand jury investigations would have been better served had 

the Government not taken such a belt and suspender approach

by subpoenaing both the privilege holder and its law firms, 

but instead had directed its subpoena only to the custodians of 

the records and allowed the Perlman doctrine full play with 

an adjudication on appeal of the privilege claims. 

C. Effect of Current Representation by the Law Firms

Finally, although not addressed by the majority, the 

Government argues that the Perlman doctrine does not apply 

in this instance because the law firms are not “[d]isinterested 

[t]hird [p]arties” due to their current representation of 

subjects of the grand jury investigation. (Appellee’s Br. 15.) 

I believe that the Perlman doctrine applies to current 

attorneys and would reject this argument.

As an initial matter, our Court’s interpretation of the 

Perlman doctrine does not require strict disinterest, at least in 

the sense of requiring total non-affiliation with the privilege 

holder. We have instead tended to focus our analysis on 
11

whether the privilege holder “is in a position to control the 

[subpoenaed custodian’s] decision whether to produce the 

records,” and on whether the third-party’s personal stake in 

the matter is substantial enough for it to likely stand in 

contempt to protect the privilege holder’s rights. In re Grand 

Jury Matter, 802 F.2d 96, 99 (3d Cir. 1986); see In re Grand 

Jury (C. Schmidt & Sons, Inc.), 619 F.2d at 1024-25 (holding 

that the privilege holder’s employees are third-parties under 

Perlman because employees are unlikely to stand in contempt 

to protect their employer). Applying this framework, the 

majority and I agree that a privilege holder’s former attorney 

qualifies as a third-party custodian under the Perlman

doctrine, because a former attorney is not guaranteed to stand 

in contempt to protect his or her former client’s privilege. 

See In re Grand Jury Proceedings (FMC Corp.), 604 F.2d at 

800-01. I believe, as do the majority of other circuits that 

have addressed this issue, that there is no reason to apply a 

different rule to current attorneys. See, e.g., In re Grand Jury 

Subpoenas, 123 F.3d 695, 699 (1st Cir. 1997) (“[W]e adopt 

the majority rule and apply the Perlman exception to those 

cases wherein a client seeks immediate appeal of an order 

compelling production of a client’s records from his 

attorney.”); In re Grand Jury Proceedings in Matter of Fine, 

641 F.2d at 203 (holding that current attorneys qualify as 

third-parties under Perlman); In re Grand Jury Proceedings 

(Gordon), 722 F.2d 303, 307 (6th Cir. 1983) (“This Court . . . 

joins the majority of other Circuits in applying the Perlman

exception in those cases wherein a client seeks immediate 

appeal of an order compelling testimony from his attorney.”); 

In re Klein, 776 F.2d 628, 632 (7th Cir. 1985) (applying the 

Perlman doctrine to current attorneys); In re Grand Jury 

Proceedings (Malone), 655 F.2d 882, 885 (8th Cir. 1981) 

(“[T]he Perlman exception is available to a client-intervenor 
12

when he is appealing an order compelling testimony or 

documents from his attorney.”); In re Grand Jury 

Proceedings, 689 F.2d 1351, 1352 n.1 (11th Cir. 1982) 

(explaining that the Eleventh Circuit is bound by the Fifth 

Circuit’s holding that attorneys are third-parties under 

Perlman). While a client’s interests may be more closely 

aligned with his or her current attorney than with a former 

attorney, a client cannot control whether his or her attorney 

chooses to stand in contempt. 

Moreover, to the extent that current attorneys are 

“interested parties,” they, like former attorneys, are unlikely 

to be so interested that they will stand in contempt to protect 

their client’s privilege. See In re Grand Jury Proceedings in 

Matter of Fine, 641 F.2d at 203 (“we can say without 

reservation that some significant number of client-intervenors 

might find themselves denied all meaningful appeal by 

attorneys unwilling to” stand in contempt on their client’s 

behalf). Accordingly, because an attorney need not, and 

probably will not, stand in contempt to protect his or her 

client’s privilege, I believe that our Court’s longstanding 

interpretation of the Perlman doctrine requires finding that 

current attorneys are third-parties.

Additionally, requiring attorneys to stand in contempt 

to enable their clients to appeal unnecessarily fosters conflicts 

of interest between attorneys and their clients. As the First 

Circuit explained in overruling its prior decision excluding 

attorneys from the Perlman doctrine, requiring attorneys to 

stand in contempt “pits lawyers against their clients” by 

requiring attorneys to choose between protecting their clients’ 

interests and protecting themselves against potentially serious 

contempt sanctions. In re Grand Jury Subpoenas, 123 F.3d at 
13

699 (citing United States v. Edgar, 82 F.3d 499, 507-08 (1st 

Cir. 1996)). I share the First Circuit’s view that placing 

attorneys in this predicament “hinders the fair representation 

of the client.” Id.

I am aware that the Ninth Circuit does not ordinarily 

permit Perlman appeals when the custodian is the privilege 

holder’s current attorney. See, e.g., In re Grand Jury 

Subpoena, 825 F.2d 231, 237 (9th Cir. 1987) (declining to 

apply the Perlman doctrine when the custodian is the 

privilege holder’s current attorney). I cannot agree, however, 

with the Ninth Circuit’s logic. The Ninth Circuit implies that 

a current attorney is more likely to stand in contempt than a 

former attorney, because a current attorney “‘is both subject 

to the control of the person or entity asserting the privilege 

and is a participant in the relationship out of which the 

privilege emerges.’” Id. (quoting In re Grand Jury Subpoena 

Served upon Niren, 784 F.2d 939, 941 (9th Cir. 1986)). This 

reasoning disregards the fact that a privilege holder’s control 

over his or her attorney does not extend to deciding whether 

his or her attorney stands in contempt. Because the 

custodian’s likelihood of standing in contempt is the relevant 

type of control under the Perlman doctrine, I do not find the 

Ninth Circuit’s reasoning to be persuasive and would hold 

that we have jurisdiction. 

II. Merits

Instead of dismissing ABC’s appeal of the March 

Order for lack of jurisdiction, I would affirm the District 

Court’s decision on the merits. For the reasons articulated by 

the majority, I would find that the crime-fraud exception to 

the attorney-client privilege is fully applicable to the 
14

documents that are the subject of the March Order. 

Accordingly, I would affirm both the March and the June 

Orders.