Source: http://attorneyclientprivilege.mcguirewoods.com/chapter.aspx?ch=59
Timestamp: 2019-04-21 13:09:42+00:00

Document:
(reversing a district court's order requiring defendant to produce privileged documents; noting that defendant had repeatedly revised its privilege log, but that disputes remained; explaining that the magistrate judge initially refused to review documents in camera; "[T]he magistrate judge said to Equitable: 'If you think I'm going to go through 1500 documents, read them all, and decide from this kind of stuff, you are mistaken . . . . I'm not going to allow somebody to put me in a position where I'm going to be reading documents in camera."; explaining that "the magistrate judge sua sponte formulated his own procedure to determine if he would impose the global-disclosure sanction: Emerald [plaintiff] would select twenty of the remaining documents on the fourth-amended log and then Equitable would submit those twenty for in camera review. This was not a random sample; every document that had not already been reviewed in camera was fair game. Then, if the magistrate judge found four or more of the twenty to contain non-privileged material, he would sanction Equitable by ordering a disclosure of every document remaining on the log. On the other hand, if he found three or fewer to contain non-privileged material, he would deny Emerald's motion."; noting that the magistrate judge apparently forgot the details of his own order; "After some more wrangling and two additional hearings, the magistrate judge announced his decision on the record on September 23, 2002. He first ruled that four documents were not protected by the attorney-client privilege but that the other sixteen were. Curiously, he then denied Emerald's motion, stating that he would not sanction Equitable because he believed that his August 14 ruling was that 'four and no more' equaled no sanction. . . . Emerald challenged the magistrate judge's recollection, accurately stating that the rule was, if there were four or more non-privileged documents, 'we get everything.' . . . After a recess, the magistrate judge corrected his error and included a fifth document on the list of the non-privileged. The magistrate judge thus reversed his earlier ruling and granted the motion, ruling that he could not 'rely on the integrity' of the log." (emphasis added); "This disclosure was to include thirty-three documents that the magistrate judge himself found to contain privileged material: eight from his March 20 ruling, ten from his June 5 ruling, and fifteen from his September 23 ruling.") (emphasis added).
"Court Explains Who Can Make Privilege Rulings in Administrative Law Contexts"
Among administrative law judges, magistrate judges, and Article III judges involved in administrative issues, who can make privilege calls?
In NLRB v. NPC International, Inc., No. 13-0010, 2017 U.S. Dist. LEXIS 23138 (W.D. Tenn. Feb. 16, 2017), the United States magistrate judge ordered defendant to produce documents pursuant to an NLRB subpoena. The Article III judge followed other decisions in holding that magistrate judges' order are "dispositive," because they "dispose of the entire matter at issue." Id. at *7. The court therefore construed the magistrate judge's decision "as a recommendation which will be reviewed de novo and [to which the court] will apply the clearly erroneous or contrary to law standard." Id. at *8. The judge then turned to the difference between its power under Article III and the NLRB's administrative law judge's power. While criticizing defendant for failing to prepare a privilege log for the administrative law judge, the court acknowledged that it rather than the ALJ had "authority to make an ultimate determination on these issues" – and then overturned the magistrate judge's recommendation that the defendant waived its protections by not preparing a log. Id. at *20.
In those murky administrative areas where administrative, magistrate, and Article III judges exercise their power, corporations and their lawyers should keep track of which judge can decide which privilege issues.
"Courts Deal with Litigants' Tardy or Inadequate Privilege Logs"
Courts frequently deal with litigants' tardy or inadequate privilege logs. Among other things, they must decide the standard of review for a magistrate judge's initial determination; who has jurisdiction to impose sanctions; and the obvious issue of a late or inadequate log's implications. Three decisions decided in the same month highlight these issues.
In United States SEC v. Commonwealth Advisors, Inc., the court extensively analyzed the proper standard for reviewing a magistrate judge's decision that a litigant waived its privilege protection by including "factually incorrect entries" in an amended log (following the magistrate judge's conclusion that the first log was inadequate). Civ. A. No. 3:12-00700-JWD-EWD, 2016 U.S. Dist. LEXIS 46438, at *4 (M.D. La. Apr. 6, 2016). The court applied a "clearly erroneous" standard in upholding the magistrate judge's harsh sanction. Id. At *6. A few weeks later, in NLRB v. D. Bailey Management Co., No. 2:16-cv-02156-CAS (AFMx), 2016 U.S. Dist. LEXIS 57550 (C.D. Cal. Apr. 25, 2016), the court first held that an administrative law judge lacked the power to sanction a litigant's tardy log by finding a waiver — but then itself found that the defendant waived its privilege by failing to log withheld documents for nearly a year. Three days after that, the court in Anderson v. Mountain States Mutual Casualty Co., Civ. A. No. 15-cv-01316-RM-NYW, 2016 U.S. Dist. LEXIS 56733 (D. Colo. Apr. 28, 2016), followed the more generous approach many courts take — finding a litigant's logs inadequate, but giving it a second chance.
The SEC v. Commonwealth Advisors court recognized that "[d]iscovery has become the preeminent battleground in modern litigation, perhaps eclipsing the rare trial." 2016 U.S. Dist. LEXIS 46438, at *2 n.1. That battleground often includes skirmishes over privilege logs' timing and adequacy.
"Courts Sometimes Use Special Masters to Assess Privilege and Work Product Claims"
The judge handling the criminal case against President Trump's former lawyer Michael Cohen appointed a special master to review for privilege or work product protection documents the government seized from Cohen's office. The media covered this as newsworthy, but special masters frequently play such a role.
In Winfield v. City of New York, Judge Parker appointed respected retired Judge Frank Maas as a special master to review defendant City's withheld documents – noting that the "task of reviewing 3,300 documents is enormous and one that this Court cannot complete before the end of fact discovery." No. 15-cv-05236 (LTS) (KHP), 2018 U.S. Dist. LEXIS 79281, at *25 (S.D.N.Y. May 10, 2018).
Corporate litigants should carefully consider suggesting that courts appoint such special masters. Billing by the hour, special masters frequently spend more time analyzing privilege and work product assertions. This sometimes contrasts with overworked judges, who often look primarily (if not exclusively) on the face of withheld documents for clients' explicit requests or legal advice or lawyers' explicit legal advice in response.
(applying the fiduciary exception; holding that an investor which on seventy percent of an LLC did not automatically deserve access to the LLC's privileged documents, and remanding for an in camera review; "[I]t is uncontested that the special referee did not review a single document in camera, despite being instructed by the motion court to conduct an item-by-item review. Therefore, we cannot affirm an order directing the production of more than 3,000 purportedly privileged communications without a single one of those communications having been reviewed.").
("Under those circumstances, there was no need for a privilege log to address that general question, and appellant's failure to provide a privilege log in opposition to the motion to compel did not deprive appellant of the right to contest the government's overall crime-fraud theory."; "The failure to produce a privilege log (or otherwise identify particular documents subject to the privilege) to support the need for in camera inspection waived appellant's right to seek in camera inspection."; "Neither appellant nor appellant's attorneys ever produced a privilege log in response to the motion to compel nor otherwise complied with the requirements of Rule 45. Under this court's cases, that constitutes a waiver of the request for in camera review.").
The Federal Rules of Civil Procedure do not require privilege logs, but most courts require one in their local rules, or at least expect one. Courts can react in widely varying ways to litigants' failure to prepare any log, or failure to prepare an adequate log. Four decisions highlight the spectrum of courts' possible remedies.
In Apple Inc. v. Samsung Electronics Co., the court condemned defendant Samsung's privilege log as having provided "only generic statements" supported by a "'vague declaration'" — but explained that he had earlier "granted in camera review" rather than ordering the documents produced. Case No. 5:11-cv-01846-LHK-PSG, 2015 U.S. Dist. LEXIS 45386, at *59-60 (N.D. Cal. Apr. 3, 2015) (citation omitted). In Thermoset Corp. v. Building Materials Corp. of America, the court noted that defendant did not provide a supplemental privilege log until 38 days after producing responsive documents, but declined to find a waiver despite the tardiness — relying on a "'holistic reasonableness analysis.'" Case No. 14-60268-CIV-COHN/SELTZER, 2015 U.S. Dist. LEXIS 45924, at *19 (S.D. Fla. Apr. 8, 2015) (citation omitted). In United States v. Biberstein, the court criticized respondent's privilege log as providing "little help to the Court" — because it lacked pertinent dates and contained only "boilerplate language." No. 7:14-CV-175-BO, 2015 U.S. Dist. LEXIS 55139, at *4-5 (E.D.N.C. Mar. 23, 2015). Noting that respondent "had numerous opportunities to meet his burden to demonstrate that the documents are privileged" (id.), the court ordered defendant to produce all the withheld documents (declining respondent's offer to allow the court's in camera review). In Swoboda v. Manders, the court condemned plaintiff's failure to prepare a log — bluntly ordering plaintiff to produce "any documents related to allegations in the plaintiff's complaint" (apparently even including "communications with counsel that [took] place after the filing of a law suit"). Civ. A. No. 14-19-SCR, 2015 U.S. Dist. LEXIS 54329, at *11-12 (M.D. La. Apr. 27, 2015).
Given the unpredictability of courts' reactions to nonexistent, tardy, or insufficient privilege logs, litigants should comply with local rules and customs — and familiarize themselves with the presiding judge's likely approach.

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