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Keywords

litigationattorneysubpoenaappealwillgrand juryattorney-client privilege

attorneysubpoenaappealtrialcorporationgrand juryattorney-client privilege

Related Cases

In re Special September 1978 Grand Jury (II), 640 F.2d 49, 6 Fed. R. Evid. Serv. 616

Facts

The Community Currency Exchange Association of Illinois, a trade association for the currency exchange industry, was under investigation by a federal grand jury. Subpoenas were issued to the law firms Jenner & Block and McDermott, Will & Emery for documents related to the Association's representation. The district court quashed the subpoenas, citing attorney-client privilege and the work product doctrine. However, the government argued that ongoing fraud by the Association negated these protections.

The Association is a not-for-profit corporation which serves as a trade association for the Illinois currency exchange industry. Its membership includes approximately 550 currency exchange locations and approximately 350 owners.

Issue

Did the district court err in quashing the grand jury subpoenas based on attorney-client privilege and the work product doctrine in light of the alleged ongoing fraud by the Association?

Rule

The attorney-client privilege is waived when the client uses the attorney-client relationship to engage in ongoing fraud. The work product doctrine may also be waived in cases of client fraud, but can protect an attorney's mental impressions, conclusions, opinions, and legal theories.

The attorney-client privilege is waived when the client uses the attorney-client relationship to engage in ongoing fraud rather than to defend against past misconduct.

Analysis

The Court of Appeals found that the district court abused its discretion by upholding the attorney-client privilege despite a prima facie showing of fraud. The court determined that the documents sought were not protected by the work product doctrine as they were not prepared in anticipation of litigation. The court emphasized that the ongoing fraud by the Association justified the enforcement of the subpoenas.

After examining the documents submitted in camera by the Government to support its assertion that ongoing fraud by the Association dissipated the attorney-client privilege, we have concluded that a prima facie showing of fraud was made and that the trial judge abused his discretion in upholding the attorney-client privilege with respect to the Jenner & Block subpoena.

Conclusion

The Court of Appeals reversed the district court's decision and directed that the subpoenas be enforced, allowing the grand jury to obtain the requested documents.

Reversed with directions.

Who won?

The United States prevailed in the case because the Court of Appeals found that the attorney-client privilege and work product doctrine were waived due to the prima facie showing of fraud by the Association.

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