On August 11, 2015, the United States Court of Appeals for the District of Columbia in In Re Kellogg Brown & Root, Inc. 25 granted a writ of mandamus and vacated two district court orders that directed the production of key documents related to an internal investigation conducted by petition, Kellogg Brown & Root ("KBR"), a defense contractor. This was the second time that the D.C. Circuit Court of Appeals granted petitioner a writ of mandamus regarding the application of the attorney-client privilege and work product protection to petitioner's internal investigation documents.26 After vacating the earlier district court order, the case was remanded to the district court to consider "timely asserted other arguments for why these documents are not covered by either the attorney-client privilege or the work-product protection.27"
Background
The background facts of the case are not in dispute. Harry Barko, who worked for KBR, filed a False Claims Act complaint in 2005, alleging that KBR defrauded the US Government by inflating costs and accepting kickbacks in connection with military contracts in wartime Iraq. Barko sought documents related to a prior KBR internal investigation into the alleged fraud. KBR asserted that the internal investigation had been conducted for the purpose of obtaining legal advice and that the internal investigation documents were protected by the attorney-client privilege.28 However, it was revealed during a corporate 30(b)(6) deposition of Chris Heinrich, KBR's Vice President (Legal), that Heinrich reviewed the disputed documents related to KBR's internal investigation in preparation for the deposition. At the deposition, KBR's attorney instructed Heinrich not to answer questions about the content of the internal investigation documents on the basis of the attorney-client privilege and work-product protection. Following the deposition, KBR moved for summary judgment. In its motion, KBR stated that KBR performed an internal investigation in accordance with its internal Code of Business Conduct ("COBC") policy, and concluded that KBR did not violate the Anti-Kickback Act. On November 20, 2014, the district court ruled that KBR waived privilege when Heinrich reviewed the internal investigation documents in preparation for his deposition, and KBR's motion that affirmatively referenced the COBC documents created an implied waiver. On December 17, 2014, the district court issued a separate opinion and order compelling production of parts of the COBC documents on the alternative basis that they "are discoverable fact work-product and Barko shows substantial need."29 The Circuit Court found that the district court erred and vacated both orders.
Waiver in the Context of the 30(b)(6) Deposition.
Barko argued that KBR waived privilege to the COBC documents under FRE 612 by permitting Heinrich to review the COBC documents prior to the 30(b)(6) deposition. The Circuit Court rejected Barko's claim. According to the Circuit Court, Rule 612 applies only where a witness uses a writing to refresh memory. Thus, the Circuit Court stated that "even if the witness consults a writing while testifying, the adverse party is not entitled to see it unless the writing influenced the witness's testimony."30 The Court noted that Barko noticed the deposition to cover the topic of the COBC investigation itself. The Court held that Barko cannot overcome the privilege by putting the COBC investigation in issue at the deposition, and then demanding under Rule 612 to see the investigating documents. According to the Court, "permitting privilege and protection to be so easily defeated would defy 'reason and experience'."31
Waiver in Context of Placing the COBC Documents "at Issue" in KRB's Motion.
The issue was whether KBR's reference to the COBC investigation in the motion in support of summary judgment placed the COBC documents "at issue" creating a waiver of the attorney-client privilege and work-product protection. Although Barko's argument had some appeal, the Circuit Court found that KBR had not waived privilege as to the COBC documents by referencing the COBC investigation related to Barko's claim and statement that it did not report any wrongdoing to the Government based on its internal investigation. The Court concluded that the context of KBR's statement supported the conclusion that KBR did not waive the privilege. First, KBR's reference to the COBC investigation relating to Barko's claim appeared only in a footnote in the motion's introduction. This fact was significant to the Court because (i) the statement was not in the argument section of the motion, and (2) generally, courts do not "indulge cursory arguments made only in a footnote."32 In addition, the Court noted that in the context of summary judgment, all inferences were to be drawn against KBR at this stage of the litigation, thus, it was an error for the district court not to view KBR's statements in the light most favorable to Barko.
Non-Privileged Fact Work-Product.
The Circuit Court also found that the district court erred in requiring disclosure of portions the of COBC report as fact work-product. Upon review of the compelled disclosed information, the Circuit Court concluded that the material was attorney-client privileged and opinion work-product. Accordingly, the Circuit Court concluded that the compelled production rulings dated November 20, 2014 and December 17, 2014 constituted error, and granted KBR's writ of mandamus.
Footnotes
25 In re: Kellogg Brown & Root, Inc., No. 14-5319 (D.C. Cir. August 11, 2015)
26 See In re: Kellogg Brown & Root, Inc., 756 F.3d 754 (D.C. Cir. 2014)
27 Id.
28 See Upjohn v. United States, 449 U.S. 383 (1981).
29 United States ex. Rel. Banko v. Halliburton Co., 2014 WL 7212881 (D.D.C. Dec. 27, 2014)
30 Slip. Opn at 10, citing 4 Jack B. Weinstein & Margaret A. Berger, Weinstein's Federal Evidence § 612.04(2)(b)(1) (2d ed. 1997).
31 Slip. Opn at 12.
32 Slip. Opn at 18.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
