Justices to Clarify Privilege of Communications Beyond Legal Advice

The US Supreme Court agreed to consider if the protections under attorney-client privilege sweep broadly enough to include business communications, a tricky issue that lawyers frequently face in the corporate world.

The case involving “dual purpose” communications that the justices agreed to hear Monday aims to clarify tests used by the judiciary to determine whether communications beyond legal advice can be claimed as privileged and withheld from opposing counsel.

The conflict commonly arises in cases involving corporate counsel.

“Given our increasingly complex regulatory landscape, attorneys often wear dual hats, serving as both a lawyer and a trusted business advisor,” the San Francisco-based US Court of Appeals for the Ninth Circuit said in a ruling that is now before the justices.

The Ninth Circuit in 2021 said the so-called primary purpose test—looking to the overarching purpose of the communications—was the proper way to determine if dual-purpose communications are protected from being turned over to the other side.

The case involves sanctions against an unnamed company and its lawyers who failed to comply with grand jury subpoenas. The parties refused despite rulings that the requested documents weren’t protected by attorney-client privilege because the “primary purpose” of the communications was to obtain business, not legal, advice.

Other circuits have used other tests to determine privilege, the company and law firm said in their brief asking for the justices to intervene. They added that “while lawyers frequently must assess privilege issues,” appellate courts are limited in their ability to review trial court determinations.

The Supreme Court agreed to hear the case over the objection of the Justice Department, which said the standards governing dual-purpose communications are “well settled” in the lower federal courts.

The case is In re Grand Jury, U.S., No. 21-1397.