In Re Chevron Corp.
650 F.3d 276 (2011)
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Rule of Law:
The attorney-client privilege does not attach to communications made in the presence of third parties whose presence is not essential to the legal consultation. Therefore, the disclosure of such non-privileged communications cannot operate as a subject matter waiver of other, genuinely privileged communications.
Facts:
- Texaco Petroleum Company (TexPet), a subsidiary later acquired by Chevron, conducted oil exploration activities in the Oriente region of Ecuador.
- Inhabitants of the region (the Ecuadorian plaintiffs) alleged that these activities caused widespread environmental contamination and significant health problems.
- The Ecuadorian plaintiffs' legal team included lead American attorney Steven Donziger and attorney Joseph C. Kohn, who also helped finance the litigation.
- During the litigation, Donziger invited a documentary film crew to attend and record numerous attorney-client meetings and strategy sessions for a film titled 'Crude'.
- These recorded sessions, including hundreds of hours of outtakes, captured discussions about legal strategy, evidence, and purported wrongdoing by Chevron.
- Chevron alleged the plaintiffs' lawyers engaged in fraud, including ghostwriting a supposedly neutral expert's damages report and colluding to bring criminal charges against two of Chevron's attorneys, Rodrigo Pérez Pallares and Ricardo Reis Veiga.
Procedural Posture:
- Chevron Corporation and its attorneys (the Chevron applicants) filed applications in the U.S. District Court for the Eastern District of Pennsylvania pursuant to 28 U.S.C. § 1782.
- The applications sought an order compelling discovery from attorney Joseph C. Kohn for use in an Ecuadorian environmental lawsuit, related criminal proceedings, and an international arbitration.
- The Ecuadorian plaintiffs and the Republic of Ecuador intervened in the district court action to oppose the discovery applications, asserting attorney-client privilege.
- The District Court granted the discovery applications, ruling that the Ecuadorian plaintiffs had effectuated a broad subject matter waiver of the attorney-client privilege for all litigation-related documents by allowing a film crew to record attorney meetings.
- The Ecuadorian plaintiffs and the Republic of Ecuador, as appellants, appealed the District Court's discovery order to the U.S. Court of Appeals for the Third Circuit.
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Issue:
Does the public disclosure of attorney-client communications, which were not privileged from the outset due to the presence of third parties, effect a broad subject matter waiver of the attorney-client privilege for all other related communications?
Opinions:
Majority - Greenberg, Circuit Judge
No. The public disclosure of communications that were never privileged cannot waive the attorney-client privilege for other, protected communications. For the attorney-client privilege to attach, a communication must be made in confidence. Here, the presence of the documentary filmmakers—third parties not necessary for the provision of legal advice—at attorney-client meetings destroyed the confidentiality of those communications from the outset. Because the filmed communications were never privileged, their subsequent disclosure could not trigger a subject matter waiver of other, genuinely confidential communications contained in attorney Kohn's files. The fairness concern that animates the subject matter waiver doctrine—preventing a party from using privilege as both a sword and a shield—is not implicated when the disclosed material was never privileged in the first place. The court therefore reversed the district court's order but remanded for consideration of whether the crime-fraud exception might apply.
Analysis:
This decision provides a crucial clarification on the mechanics of attorney-client privilege, distinguishing between the failure of the privilege to attach and the waiver of an existing privilege. It curtails the scope of subject matter waiver by holding that it can only be triggered by the disclosure of information that was initially privileged. This ruling serves as a stark warning to legal practitioners about the perils of allowing third parties, such as media or filmmakers, into confidential strategy sessions, as it vitiates privilege from the start. For future cases, it establishes that a party arguing for subject matter waiver must first prove that the disclosed communication was privileged before its disclosure.
