In Re Vioxx Products Liability Litigation
501 F. Supp. 2d 789, 2007 WL 2309877 (2007)
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Rule of Law:
For the attorney-client privilege to apply to a corporate communication involving in-house counsel, the communication's primary purpose must be to seek or provide legal advice. When a communication is sent simultaneously to lawyers and non-lawyers for mixed business and legal review, it generally does not have a primary legal purpose and is therefore not privileged.
Facts:
- Merck & Co., Inc. (Merck), a pharmaceutical company, developed, manufactured, and marketed the prescription drug Vioxx.
- Vioxx was approved for sale by the FDA in 1999.
- Within Merck's highly regulated business, in-house counsel were heavily involved in reviewing various corporate communications, including scientific reports, marketing materials, and publications.
- Many internal communications, particularly emails with attachments, were circulated simultaneously to both in-house lawyers and non-legal personnel (e.g., in marketing, public relations, science) for their review and comment.
- Merck's legal department possessed the authority to place 'holds' on the dissemination of documents until its legal concerns were addressed.
- On September 30, 2004, Merck voluntarily withdrew Vioxx from the market after a clinical trial revealed that it increased the risk of cardiovascular events like heart attacks and strokes.
Procedural Posture:
- Thousands of individual lawsuits and class actions were filed against Merck in various federal and state courts.
- The Judicial Panel on Multidistrict Litigation (JPML) transferred the federal cases to the U.S. District Court for the Eastern District of Louisiana for consolidated pretrial proceedings.
- During discovery, the Plaintiffs' Steering Committee (PSC) challenged Merck's assertion of attorney-client privilege over approximately 30,000 documents.
- The District Court conducted an initial in camera review of all documents and issued privilege rulings.
- Merck, the defendant, sought a writ of mandamus from the U.S. Court of Appeals for the Fifth Circuit to overturn the District Court's rulings.
- The Fifth Circuit denied the writ but suggested that the District Court use a new protocol to re-examine a representative sample of the documents.
- Pursuant to the Fifth Circuit's suggestion, the District Court appointed a Special Master, Professor Paul R. Rice, to review a sample of approximately 2,600 documents and issue a report and recommendations on Merck's privilege claims.
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Issue:
Does the attorney-client privilege protect internal corporate communications that are sent simultaneously to both lawyers and non-lawyers for review and comment on mixed business and legal matters?
Opinions:
Majority - Fallon, District Judge
No. The attorney-client privilege does not protect internal corporate communications sent simultaneously to lawyers and non-lawyers for mixed business and legal purposes because the primary purpose of such communications is not to obtain legal assistance. The court adopted the Special Master's report, which reasoned that in the corporate context, where in-house counsel are often involved in business, technical, and scientific matters, the proponent of the privilege bears a clear burden to show the attorney was acting in a professional legal capacity. When a document is prepared for simultaneous review by both legal and non-legal personnel, it cannot be said that its primary purpose is to secure legal advice. Merely being in a 'pervasively regulated' industry does not automatically shield all communications involving lawyers; the privilege must be established on a document-by-document basis. Furthermore, a corporation cannot immunize discoverable business communications by its chosen method of circulation, such as including lawyers on emails with non-lawyers or by having lawyers superimpose their edits onto otherwise non-privileged documents.
Analysis:
This order provides a significant framework for analyzing attorney-client privilege in the context of modern corporate e-communications and complex litigation. The court's adoption of the 'primary purpose' test in a highly practical manner serves as a warning to corporations that simply 'copying' in-house counsel on business communications will not shield them from discovery. This decision emphasizes that the burden of proof is squarely on the corporation to demonstrate a primary legal purpose, especially in industries where legal and business advice are often intertwined. It also endorses the use of special masters and document sampling as a pragmatic tool for managing massive e-discovery privilege disputes, a practice likely to become more common in multidistrict litigation (MDL).
