Securities Lawyers Warn ‘Textron’ May Hurt Communications With Attorneys and Auditors

Securities attorneys expressed disappointment at the U.S. Supreme Court’s recent decision not to review a controversial ruling on the scope of work-product protection for accountant work papers, warning that it could adversely impact companies’ communications with counsel and auditors.

The high court’s May 24 denial of the certiorari petition in Textron Inc. v. U.S. leaves in place a divided en banc decision by the First Circuit that tax accrual work papers sought by the IRS in an administrative summons were not entitled to work product protection. The doctrine generally shields from discovery materials that are prepared in anticipation of litigation. ...