1. No category

THE (UNAPPRECIATED) MULTIDIMENSIONAL
BENEFITS OF RULE 502(D): WHY AND HOW
LITIGANTS SHOULD BETTER UTILIZE THE NEW
FEDERAL RULE OF EVIDENCE
EDWIN M. BUFFMIRE*
This Article provides a clear and simple instruction to courts and
litigants on how to address the problem of increasing litigation costs while
also protecting attorney-client privilege. Litigants possess a very valuable
tool for protecting materials covered by the attorney-client privilege and
attorney work-product doctrines as well as reducing litigation costs.
Surprisingly, however, they have been slow to adopt this new tool into
regular practice. And when they have done so, they have used it
improperly. Federal Rule of Evidence 502, which Congress enacted to
achieve goals of increased certainty and cost reduction, has not lived up to
its promise. This Article examines Rule 502 for its strengths and
weaknesses in achieving Congress’s intentions. It concludes that Rule
502(d) is the touchstone upon which the litigation community can begin to
build a more efficient and predictable civil discovery environment. It tests
the criticisms of the new rule and posits that protective orders under Rule
502(d) carry no inherent risk yet provide substantial benefits. Therefore,
such orders should become a standard feature of litigants’ and courts’
discovery practice.
I.
II.
III.
IV.
V.
INTRODUCTION ............................................................................... 142
LEADING UP TO RULE 502(D)......................................................... 146
A. Early Concern Over Privilege Review Costs ............................ 147
B. Requisite Characteristics of a New Rule of Evidence ............... 149
C. Practical Effects of the Proposal and Example of Life Without
Certainty ................................................................................. 152
THE TEXT OF THE RULE AND COMMENTS GUIDING ITS
APPLICATION ............................................................................... 155
RULE 502(B) CREATES A MORE CERTAIN, BUT STILL UNCERTAIN,
WORLD ......................................................................................... 160
A. The Pre-Rule 502 Foundation: The Lasting Effect of Hopson and
Victor Stanley ......................................................................... 161
B. Post-Rule 502 Cases ................................................................. 163
THE SOLUTION: RULE 502(D) ......................................................... 167
A. Courts Using Rule 502(d) Orders ............................................. 168
B. Parties’ Use of Rule 502(d) ...................................................... 172
141
142
VI.
VII.
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WHY ARE PARTIES NOT USING RULE 502(D)? .............................. 178
A. Rule 502(d) Delineates the Controlling Effect of a Federal Court
Order ....................................................................................... 179
B. Rule 502(d) Cannot Unring the Bell, but It Can Limit Who Hears
It .............................................................................................. 183
C. Other Considerations................................................................ 186
CONCLUSION .................................................................................. 188
I. INTRODUCTION
An uncertain privilege is no privilege at all.1 In today’s world of
complex civil litigation, which struggles to manage the large volume of
information recorded every day, the inadvertent disclosure of documents
subject to the attorney-client privilege or work product protection is
inevitable.2 The increasing costs required to avoid privilege waiver have
been well documented.3 Congress explicitly sought to control those cost
increases and provide certainty by passing Federal Rule of Evidence 502.4
Congress had ambitious goals for Rule 502, as Senator Patrick Leahy (D* Associate, Jackson Walker L.L.P, Northwestern University School of Law, J.D.
2011, Princeton University, A.B. 2007. I cannot express sufficient gratitude to Judge Sidney
I. Schenkier for his mentorship during the planning, research, and early drafts of this project.
Also, I thank Professors Lisa Huestis and James Pfander for their helpful thoughts on the
piece. I am grateful to the Editorial Board of the Tennessee Law Review for this opportunity
and the helpful comments in preparing this piece for publication. The attorneys at Jackson
Walker L.L.P., Howard & Howard PLLC, and members of the Chicago Chapter of the
Federal Bar Association provided valuable information regarding the current use of Rule
502(d) by members of the bar. All mistakes and misstatements made on the following pages
are solely my own despite the exceptionally insightful help from these individuals.
1. Upjohn Co. v. United States, 449 U.S. 383, 393 (1981) (“An uncertain privilege,
or one which purports to be certain but results in widely varying applications by the courts,
is little better than no privilege at all.”).
2. See Hearing of the Advisory Comm. on Evidence Rules January 29, 2007, 110th
Cong. 107 (2007) [hereinafter New York Hearing] (testimony of Paul Neale, Litigation
Consultant to the Plaintiffs in Hopson v. City of Baltimore, 232 F.R.D. 228 (D. Md. 2005)),
available at http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/2007-01-29-Evidence
-Minutes-Transcript.pdf.
3. See STAFF OF S. COMM. ON THE JUDICIARY, 109TH CONG., SUMMARY OF REP. ON
RULES OF PRACTICE & PROCEDURE 22–23 (Comm. Print 2005) [hereinafter JUDICIAL
SUMMARY], available at http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Reports/
ST09-2005.pdf (noting that the discovery of electronically stored information is
“characterized by exponentially greater volume than hard-copy documents” and that national
rules are required to reduce the debilitating effect of inconsistency on large organizations
and individual litigants alike); see also Anthony Francis Bruno, Note, Preserving AttorneyClient Privilege in the Age of Electronic Discovery, 54 N.Y.L. SCH. L. REV. 541, 543–44
(2009).
4. 154 CONG REC. S1317 (daily ed. Feb. 27, 2008) (statement of Sen. Leahy).
2011]
THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
143
VT) stated when proposing the bill on the floor of the Senate: “Mr.
President, today I hope we pass a bipartisan bill that will go a long way in
reducing the costs of litigating disputes in our civil justice system.”5 Rule
502 supplies certainty to privilege protections and enables cost savings for
litigants, but only if it is properly utilized.
Subsection (d) of Rule 502 is the touchstone upon which Congress and
the Judicial Conference Committee on the Rules of Evidence—the
Committee responsible for submitting a proposed rule—sought to achieve
Senator Leahy’s ambitions. It states: “(d) CONTROLLING EFFECT OF A
COURT ORDER.—A Federal court may order that the privilege or protection
is not waived by disclosure connected with the litigation before the court—
in which event the disclosure is also not a waiver in any other Federal or
State proceeding.”6 Unlike subsection (d), which requires an affirmative
invocation of the rule’s protections, in subsection (b), the Evidence
Committee established a default starting point from which courts will
otherwise analyze privilege waiver in connection with inadvertent
disclosure during federal litigation, provided that no Rule 502(d) order has
been entered. Rule 502(b) provides:
(b) INADVERTENT DISCLOSURE.—When made in a Federal proceeding or
to a Federal office or agency, the disclosure does not operate as a waiver
in a Federal or State proceeding if:
(1) the disclosure is inadvertent;
(2) the holder of the privilege or protection took reasonable steps to
prevent disclosure; and
(3) the holder promptly took reasonable steps to rectify the error,
including (if applicable) following Federal Rule of Civil Procedure
26(b)(5)(B).7
Because Rule 502 applies to both the attorney-client privilege and
attorney work-product protections,8 I will use the term “privilege” generally
to describe both. For the provisions of subsection (d) to apply, a court must
enter an order addressing privilege waiver.9 Without such an order,
subsection (b) of the new rule applies to inadvertent disclosure of privileged
materials.
Subsection (b) attempts to establish a uniform standard of waiver of
privilege doctrine among federal jurisdictions, which had previously
5. Id.
6. FED. R. EVID. 502(d).
7. FED. R. EVID. 502(b).
8. See FED. R. EVID. 502 (“The following provisions apply, in the circumstances set
out, to disclosure of a communication or information covered by the attorney-client privilege
or work-product protection.”).
9. See discussion infra Part V for a more thorough discussion of what exactly such an
order must entail.
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disagreed over three different approaches to the proper consequence of an
inadvertent disclosure of privileged material.10 But the procedures required
of a party in Rule 502(b)(2)’s “reasonable steps” requirement has been and
will likely continue to be the basis for many legal disputes over privilege
waiver.11 Rule 502(b) merely establishes a uniform starting point for courts.
It does not establish a bright line for courts to easily separate the reasonable
from the unreasonable12 in order to determine what production was
inadvertent and what production was not for purposes of privilege waiver.
Rather, Rule 502(b) prescribes a factor-based analysis that may vary from
case to case.13 Indeed, commentators including Judge Paul W. Grimm14
have recently taken note of the inconsistency in the application of Rule
502(b) and how the rule has been disappointing in its limited practical
effect thus far.15 Because of the inherent variability in a factor-based
reasonableness standard, parties can never be completely certain that any
given privilege review procedure will be reasonable.16 A reasonable review
in one court may not be reasonable in every other court.17
Rule 502(d), however, establishes a bright line for those litigating
parties who invoke its protections. A party can move, either with opposing
party agreement or without, for a court to enter an order that privilege will
not be waived as a result of disclosure regardless of the privilege review
procedures. Rule 502(d) orders eliminate the default reasonableness
10. See discussion infra Part IV.
11. New York Hearing, supra note 2, at 110 (testimony of Paul Neale); see also Bd. of
Trustees, Sheet Metal Workers’ Nat’l Pension Fund v. Palladium Equity Partners, LLC., 722
F. Supp. 2d 845, 851 (E.D. Mich. 2010) (concluding that the privilege was not waived
because the disclosing party took reasonable steps to prevent disclosure).
12. This line will certainly change along with technological advancements that
simultaneously make privilege review more efficient yet increase the total amount of
information subject to discovery.
13. See FED. R. EVID. 502(b) advisory committee’s note (pointing out that cases such
as Lois Sportswear, USA, Inc. v. Levi Strauss & Co., 104 F.R.D. 103, 105 (S.D.N.Y. 1985)
set out a multi-factor test, which the Committee chose not to codify because the rule
accommodates those factors and others in its reasonableness standard).
14. Judge Grimm’s concern over the then-existing state of the law on privilege waiver
in Hopson v. City of Baltimore, 232 F.R.D. 228, 235–36 (D. Md. 2005), played a major role
in the formulation of Rule 502. See also FED. R. EVID. 502 advisory committee’s note (noting
the concern of privilege waiver in cases like Hopson).
15. See generally John W. Gergacz, Attorney-Client Privilege: Inadvertent Disclosure
and a Proposed Construction of Federal Rule of Evidence 502, 5 FED. CT. L. REV. 1 (2011)
(arguing that some courts’ misguided constructions of Rule 502 could lead to
unpredictability and confusion); Paul W. Grimm, Lisa Yurwit Bergstrom & Matthew P.
Kraeuter, Federal Rule of Evidence 502: Has It Lived Up to Its Potential?, 17 RICH. J.L. &
TECH. 1 (2011), available at http://jolt.richmond.edu/v17i3/article8.pdf (noting that the
court’s interpretation of Rule 502(b) has led to varied results).
16. See FED. R. EVID. 502(b) advisory committee’s note.
17. See id.
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
145
analysis of subsection (b), thereby providing certainty. Thus, at a minimum,
Rule 502(d) eliminates the potential cost of litigating the effect of an
unintentional disclosure in federal court.
For parties frequently engaged in litigation, however, Rule 502(d)
provides additional benefits. In addition to the certainty that an order under
Rule 502(d) provides in any single case, the rule provides that such an order
will have controlling effect in any other federal or state litigation as well.18
Therefore, a repeat litigant, such as a large corporation with vast amounts of
discoverable information, can structure a privilege review procedure
however it chooses. If privilege review will be particularly cumbersome or
a given batch of documents is highly unlikely to contain sensitive (though
privileged) information pertinent to the present action, then the party may
choose to forego the cost of paying attorneys to review those documents
prior to production. Without Rule 502(d), such a choice, though still
possible, would carry a substantial risk that a subsequent state or federal
court may find that privilege was waived as to those documents.
Consequently, in the past, parties often could not justify saving money by
reducing privilege review, because the risk of loss was too great.19 Now,
Rule 502(d) ensures that such risk is very limited.20 Indeed, Congress’s twin
goals for Rule 502—increased certainty and reduced litigation costs—are
related. The benefit that Rule 502(d) provides to repeat litigants clarifies the
connection; the increased certainty, in effect, enables more significant and
consistent litigation cost reduction.
In this Article, I argue that Rule 502(d) can fulfill both of the goals that
Congress had in mind when it enacted Rule 502. Unfortunately, however,
litigants have not regularly employed the rule’s assistance. Additionally,
when protective orders have arguably indicated intent to have an effect
similar to the type contemplated by Rule 502(d), the order itself is vague or
contradictory. Further, I argue that litigants and their counsel should make
Rule 502(d) provisions a standard part of every protective order or
discovery plan that they utilize at the beginning stages of litigation. Finally,
I propose that the Judicial Conference make a modest revision to Federal
Rule of Civil Procedure 26(f) in order to facilitate broader use of Rule
502(d) so as to effectuate Congress’s ambitious goals.
Part II of this Article reviews the testimony of attorneys, academics,
and judges during the Evidence Committee’s hearings on Rule 502. It
highlights the characteristics that were necessary to a new privilege waiver
rule in order to accomplish the stated goals. Part II also explores the
hesitations of many attorneys about encouraging relaxed privilege review
on the promise that privileged materials would remain privileged. Part III
discusses the congressional history, Advisory Committee Notes, and the
language of the rule enacted in 2008. Part IV analyzes the case law
18. See FED. R. EVID. 502(d) advisory committee’s note.
19. See New York Hearing, supra note 2, at 83 (testimony of Patrick Oot).
20. See id. at 83–85.
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covering privilege waiver as a result of inadvertent production and
concludes that despite the attempted standardization in Rule 502(b), parties
cannot be certain that their review procedures will withstand scrutiny. Part
V presents the solution to this uncertainty: Rule 502(d), which litigants can
utilize to both protect themselves from the unpredictability of Rule 502(b),
as well as substantially reduce the costs of litigation according to the
specific demands of a particular matter. Part V further examines how courts
have utilized Rule 502(d) orders to resolve discovery disputes in various
circumstances. It also presents the results of my review of a sample of cases
from 2009 and 2010 pending in the Northern District of Illinois in order to
discuss how parties have been (under)-utilizing Rule 502(d) even when
privilege issues are clearly a concern manifested in parties’ protective
orders. Part VI considers reasons why some attorneys might not be utilizing
the rule. Two primary justifications predominate. Attorneys fear that state
courts will not follow a federal order of non-waiver under Rule 502(d)
because of constitutional limitations, or they fear that disclosure will
damage their client’s interests even when privilege is not waived. I argue
that the constitutional fear is unfounded, and I point out that the fear of
damage from a privileged disclosure ignores the inherent additional risk of
waiver when similar information is disclosed absent an order and fails to
take into account the significant benefits that Rule 502(d) can provide. Part
VII concludes that parties should incorporate Rule 502(d) into any
protective order or confidentiality order. It also proposes a minor
amendment to Rule 26(f) of the Federal Rules of Civil Procedure that
would promote more widespread use of Rule 502(d) orders and thereby
reduce the cost of litigation in the courts of the United States.
II. LEADING UP TO RULE 502(D)
The cost of protecting attorney-client privilege is enormous. In the
corporate litigation world, protecting attorney-client privilege is of prime
importance.21 Nevertheless, Tom Allman, a Partner at Mayer, Brown, Rowe
& Maw in Chicago and former General Counsel for BASF, testified that in
balancing the cost of extensive privilege review against the risk of
producing privileged information following a relaxed review, it is becoming
“increasingly sensible for companies to take risks in the interest of getting
the job done.”22 In other words, the costs of privilege review are becoming
so prohibitive due to the increasing amount of information that cutting
those costs at the risk of litigation losses is becoming increasingly rational
from a business standpoint. For a company that is frequently involved in
multiple litigation matters, the protections of Rule 502(d) could change
21. See Hearing of the Advisory Comm. on Evidence Rules January 12, 2007, 110th
Cong. 7 (2007) [hereinafter Phoenix Hearing] (testimony of Tom Allman, Mayer Brown,
Rowe & Maw, LLP).
22. Id. at 8.
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
147
“disclosure without review” from a “nutty idea” to a much more calculated,
long-term cost-saving measure.23
The mass of information subject to discovery in today’s litigation
reality was an obvious impetus to the creation of a rule that would address
the costs of litigation associated with privilege review. After all, even in
2007, some speculated that there would be ten times as much information in
three years and as much as a hundred times more information in six years.24
As one individual testified to at the outset of the Evidence Committee’s
hearings on a proposed Rule 502, by not enacting a nationwide privilegewaiver rule, the Evidence Committee would be substantially limiting the
new rule.25
This Part explains the context in which Rule 502 originated. It will
trace the steps taken by the Judicial Conference to address litigation costs
associated with privilege issues and the ever-increasing volume of
discoverable information. First, it illumiates the shortcomings of the 2006
Federal Rules of Civil Procedure by looking at the background of those
amendments. These shortcomings led to the suggestion of an evidentiary
rule addressing privilege waiver in the federal courts. It then discusses the
hearings in which the Evidence Committee received input from the
litigation community about the requisite features that such a rule would
need to include in order to be effective. This Part also suggests that the
Evidence Committee responded in the rule to many of the litigants’
concerns about the practical effect of Rule 502(d) after they were raised at
those hearings.
A. Early Concern Over Privilege Review Costs
As far back as 1999, the Advisory Committee on Civil Rules was
concerned with the increasing costs of discovery directly related to
electronically stored information (“ESI”).26 The Civil Rules Committee
then embarked on a five-year project to determine how and whether the
Federal Rules could address problems related to ESI.27 This project had
many information-gathering elements, including a study by the Federal
Judicial Center on ESI disputes before federal magistrate judges, an open
letter from the Discovery Subcommittee’s Special Reporter (Professor
Richard L. Marcus of Hastings College of Law), as well as various
23. Id. at 7.
24. Id. at 4–5 (testimony of George Paul, Partner, Lewis & Roca, LLP).
25. Id. at 5.
26. Kenneth J. Withers, Electronically Stored Information: The December 2006
Amendments to the Federal Rules of Civil Procedure, 4 NW. J. TECH. & INTELL. PROP. 171,
191–94 (2006) (discussing the origins of the 2006 Amendments to the Federal Rules of Civil
Procedure).
27. Id. at 192.
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hearings, public comment submissions, and conferences.28 In June 2005, the
Rules Committee submitted its final report to the Judicial Conference,
which approved the proposals in September and recommended that the
Supreme Court adopt various amendments to the Federal Rules of Civil
Procedure.29 As a result, the Supreme Court approved major changes to
several Rules of Civil Procedure;30 chief among them for our purposes was
the amendment to Federal Rule of Civil Procedure 26(b).31
The cost of screening ESI for privileged documents was a major
consideration motivating the amendments.32 While this cost has many
causes, such as volume and accessibility, one commentator distinguished
these causes from the most significant contributor to the cost of privilege
screening: fear.33 Litigants feared a waiver of privilege as to the whole
world if a document inadvertently reached an opposing party’s hands.34 The
Civil Rules Committee agreed that “something had to be done to rein in the
cost of screening electronically stored information” because “[a]s the
volume and complexity of data sets increase, so does the danger that
attorney reviewers will inadvertently produce a [privileged] document[.]”35
In essence, the Committee observed that the fear of privilege waiver that
could result from an inadvertent production of a privileged document was
driving parties to spend enormous sums of money on screening information
for privilege; these costs were escalating along with the increasing volume
of ESI.36
The Rules Committee recognized that agreements between parties
could help reduce these costs, even if significant risks accompanied their
use.37 While such agreements would be binding on the parties, an
inadvertent disclosure might waive the privilege as to a non-party.38 Also, a
judge reviewing the disclosure would consider the degree of care taken to
prevent disclosure to determine whether it warranted privilege waiver,
thereby effectively requiring a party to nonetheless exercise a high degree
28. Id. at 193–94.
29. See JUDICIAL SUMMARY, supra note 3.
30. See FED. R. CIV. P. 5 advisory committee’s note; FED. R. CIV. P. 9 advisory
committee’s note; FED. R. CIV. P. 14 advisory committee’s note; FED. R. CIV. P.16 advisory
committee’s note; FED. R. CIV. P. 24 advisory committee’s note; FED. R. CIV. P. 26 advisory
committee’s note; FED. R. CIV. P. 33 advisory committee’s note; FED. R. CIV. P. 34 advisory
committee’s note; FED. R. CIV. P. 37 advisory committee’s note; FED. R. CIV. P. 45 advisory
committee’s note; FED. R. CIV. P. 50 advisory committee’s note.
31. FED. R. CIV. P. 26(b)(5)(B).
32. Withers, supra note 26, at 185.
33. Id.
34. Id.
35. Id. at 201 (recounting experiences in the rule drafting process that led to the 2006
amendments).
36. Id.
37. Id. at 202.
38. Id.
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
149
of care, reducing potential cost-savings.39 The Rules Committee sought to
encourage the use of party agreements such as “claw-back” agreements and
“quick-peak” agreements—agreements by which parties maintain privilege
over documents even after they have been seen by opposing parties—by
amending Rules 26(f) and 16(b) to strongly encourage parties and the judge
to consider these options.40 Accordingly, Rule 26(b)(5)(B) was amended to
read:
(B) Information Produced. If information produced in discovery is
subject to a claim of privilege or of protection as trial-preparation
material, the party making the claim may notify any party that received
the information of the claim and the basis for it. After being notified, a
party must promptly return, sequester, or destroy the specified information
and any copies it has; must not use or disclose the information until the
claim is resolved; must take reasonable steps to retrieve the information if
the party disclosed it before being notified; and may promptly present the
information to the court under seal for a determination of the claim. The
producing party must preserve the information until the claim is
resolved.41
The Advisory Committee Notes make three things clear: 1) privilege
review adds to the cost and delay of discovery; 2) Rule 26(b)(5)(B) does
not address whether privilege was waived by the production; and 3)
26(b)(5)(B) works in tandem with Rule 26(f) to allow parties to ask the
court to enter orders including agreements between the parties regarding
privilege protections.42 Thus, the 2006 amendments to the Federal Rules
Civil Procedure were the first step towards addressing the fear-based costs
and delay related to privilege review. But further steps were needed.
B. Requisite Characteristics of a New Rule of Evidence
On January 23, 2006, even before the 2006 amendments took effect,
Congressman F. James Sensenbrenner, Jr. (R-WI), a member of the House
Committee on the Judiciary, requested that the Judicial Conference initiate
a rule-making on forfeiture of attorney-client privilege.43 Congressman
Sensenbrenner stated that uncertainty regarding the subject of attorneyclient privilege caused “significant disruption and cost to the litigation
process.”44 Certainty and cost were two distinct, but related, concerns.45 He
39. Id.
40. Id.
41. FED. R. EVID. 26(b)(5)(B).
42. See FED. R. CIV. P. 26(b) advisory committee note.
43. Letter from F. James Sensenbrenner, Jr., Congressman Wis., to Ralph Mecham,
Director, Administrative Office of the U.S. Courts (Jan. 23, 2006), available at
http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/2006-01-23-Sensenbrenner.pdf.
44. Id.
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noted the practice of using agreements as a mechanism to reduce such costs
as well as the inadequacy of the protections against waiver attendant to such
agreements.46 He requested that the Judicial Conference create a rule that
would address these problems.47 Pursuant thereto, the Judicial Conference’s
various committees set about building a rule that would address the
Congressman’s request.
Rule 502 went through many iterations and revisions prior to
enactment. After nearly a year of drafting and amendment coordinated
between the Judicial Conference Committee on Rules of Practice and
Procedure and the Conference of Chief Justices, a proposed rule that
alleviated the state Chief Justices’ concerns about federal encroachment
into state privilege law was passed on to the Advisory Committee on
Evidence.48 The Evidence Committee held hearings to more fully
comprehend the interests and concerns of litigants so that the Committee
could respond in a rule that was carefully tailored to the precise problems at
issue.
In order to effectively reduce the costs associated with an exhaustive
privilege review, protection against privilege waiver—not just in the case at
hand, but also in future or parallel litigation in state or federal court—was
of the utmost importance to the commentators at the hearings. One example
was raised during the testimony that is particularly informative: a company
produces a batch of 20 million seeds for tomato crops, and the crop fails.49
As a result, a purchaser of 20,000 seeds from that batch sues the company
because of a failed crop.50 The privilege review in that particular matter, a
relatively small matter arising out of the large batch, would have the
potential to substantially impact many larger matters related to the larger
batch in future litigation.51 The costs of privilege review may substantially
outweigh the potential liability in the initial matter, but a client cannot risk
the possibility of a waiver in future, potentially larger matters.52 Rule
502(d) directly addresses this possibility by allowing the company and its
counsel to craft the privilege review procedures that it deems necessary for
the litigation at hand. Therefore, by addressing this future litigation
dilemma, a binding rule allows a party to curtail the costs of any given
litigation according to its own merits, rather than the hypothetical liability
of future or parallel claims.
45.
46.
47.
48.
49.
50.
51.
52.
Id.
Id.
Id.
See 154 CONG REC. S1317 (daily ed. Feb. 27, 2008) (statement of Sen. Leahy).
Phoenix Hearing, supra note 21, at 27 (testimony of Michael O’Connor).
Id.
Id. at 27–28.
Id.
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
151
Attorneys also stressed the importance of a rule that would
simultaneously bind state courts.53 Without such protection, they reasoned,
the protection in federal court would do little to reduce litigation costs,
because privilege review would be necessary to protect against potential
waiver in state court proceedings.54 Overwhelmingly, tort defendants’
attorneys raised the issues of enforceability and consistency in state and
federal proceedings across jurisdictions.55 One interesting issue raised by
that discussion was the “watering down effect” of inconsistent judgments
on the same documents.56 The argument proceeds—and it is probably a
good one—that once one judge finds waiver, it is very difficult to convince
a later judge that waiver would be inappropriate. Thus, a risk of one
subsequent judge waiving privilege would effectively be the same as
waiving it for all future matters.
By enacting a rule that bound state courts in any future litigation, as the
proposal would accomplish, Congress could likewise eliminate what was
effectively a one-way flood gate protecting the confidentiality of privileged
documents. An initial finding of non-waiver would have little substantive
effect on a subsequent court reviewing the privileged disclosure for waiver
(as we will see, judge’s and jurisdiction’s treatment of waiver varies
widely), but a finding of waiver would pragmatically determine all future
rulings in favor of waiver over those documents. A later court is unlikely to
uphold privilege over a document now part of the public record as a
consequence of the initial court’s ruling that waived privilege.
Subsection (d) accomplished the interest of broad controlling effect and
enforcement. Mr. Allman discussed the controlling effect of the proposal to
Rule 502(d) compared to Rule 502(b): “[Y]ou get more effect under (d)
than you do under (b).”57 The distinction was clear in the proposal. Rule
502(d) was intended to reduce costs, because it imposed strict boundaries
on any damage caused by a disclosure. Any damage was limited to the
litigation at hand; therefore, it would be proportionate to the individual
claim. Any harmful effect from the disclosure could not spread to state
court proceedings—at least through the mechanism of privilege waiver. A
Rule 502(d) order had broader effect than even a favorable Rule 502(b)
ruling because, unlike a favorable Rule 502(b) ruling for non-waiver, the
Rule 502(d) was binding on all other courts.
This preclusive effect raised a conclusion that was facially
uncomfortable with notions of federalism—the federal court’s evidentiary
order would have preclusive effect on state courts’ decisions on attorneyclient privilege, an area of state substantive law. Vice-Chief Justice Andrew
Hurwitz, the now-sitting Vice-Chief Justice for the Supreme Court of
53.
54.
55.
56.
57.
See Phoenix Hearing, supra note 21, at 17 (testimony of Steven K. Hazen).
See id. at 17–18.
New York Hearing, supra note 2, at 246–47 (testimony of Peter Sullivan).
Id.
Phoenix Hearing, supra note 21, at 9 (testimony of Tom Allman).
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Arizona and Committee member, responded to the concern about such an
encroachment on the state courts by saying that the effect of the federal
court disclosure is not a function of the state courts.58 However, a counterargument might run that a prosecutor has a right to a document over which
privilege was waived under the substantive privilege law of the prosecutor’s
state, even if that disclosure happened initially in federal court.59 The
argument is that court orders, at least lower federal court orders, bind
parties, not courts.60 As we will see, Justice Hurwitz was quite correct in his
statements that the preclusive effect of a federal court’s order is not a matter
of state law, and the counter-argument wilts when confronted with wellsettled law.61
Importantly, many individuals also saw the need to enable courts to
enter protective orders under Rule 502(d) over the objection of opposing
parties.62 This feature was necessary, in the minds of many defense
attorneys, because individual plaintiffs or even a class of individuals may
not worry about multilateral privileged communications, or document
production whatsoever.63 Thus, having nothing to gain, they might have
incentive to reject a protective order.64
In light of these necessary protections, an additional issue was what
language a party must include in a protective order to gain the Rule’s
protections. The specific language required to invoke Rule 502(d) was not
directly addressed. With that said, the Committee seemed to indicate that a
standard protective order, not invoking an intention to be bound by the rule,
would not bind third parties.65
C. Practical Effects of the Proposal and Example of Life Without Certainty
Based on the text of proposed Rule 502(d), the Committee heard
testimony on attorneys’ perceptions of the practical effects that the rule
would have. Some attorneys expressed that perhaps Rule 502(d) would not
58. New York Hearing, supra note 2, at 24 (testimony of Justice Hurwitz, Vice-Chief
Justice of the Supreme Court of Arizona); see also Semtek Int’l Inc. v. Lockheed Martin
Corp., 531 U.S. 497, 507–08 (stating that the U.S. Supreme Court has the “last word” on the
preclusive effect of all federal judgments).
59. See New York Hearing, supra note 2, at 23–24 (testimony of John Vail, senior
litigation counsel for the Center for Constitutional Litigation).
60. Id. at 25–26.
61. See id. at 24 (testimony of Justice Hurwitz).
62. Id. at 250 (testimony of Peter Sullivan).
63. See id.
64. Id. It is worth noting that some litigants’ non-use of Rule 502(d) orders could be
attributable to their belief that the rule’s protections are only relevant to one side.
65. Id. at 80 (testimony of Henry Sneath, Defense Research Institute) (noting that the
standing order did not attempt to bind third parties and would likely not provide such
protections).
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
153
have the intended cost-saving function that its drafters intended.66 In part,
litigants would be hesitant to reduce review (and thereby reduce costs),
because a litigant might be harmed by an opposing party merely reading the
information contained in a privileged document. Even if the document was
never going to be admissible under a protective order, knowledge of its
content still may affect settlement negotiations or other discovery
proceedings. Therefore, a party might be hesitant to reduce privilege review
because of that harm, even when mitigated by Rule 502(d)’s additional
protection against admissibility.
On the other hand, the cost of document-by-document privilege review
may also affect settlement negotiations. A document intensive case might
require a disproportionate amount of effort and cost to adequately review
productions for privilege.67 Patrick Oot, the Director of Electronic
Discovery and Senior Litigation Counsel at Verizon, testified before the
Committee about one of Verizon’s actual cases from 2005.68 In the matter,
Verizon utilized a three-tiered privilege review system, making use of
contract attorneys, staff attorneys, and outside counsel, to make a privilege
determination on flagged documents.69 Mr. Oot made the important point
that privilege review is critical, because the client only “get[s] one bite at
the apple.”70 In this particular case, Verizon collected approximately 1.3
terabytes of data and 2.4 million documents, all of which required some
type of human review.71 Verizon then used 5,000 terms to bifurcate the data
between two law firms.72 The contract attorney firm responsible for
privilege review received 1.02 million documents; it took over one-hundred
attorneys four months, working seven-day work weeks for sixteen hours per
day, to complete the review.73 The first-tier privilege review alone cost
Verizon $2.2 million.74 The law firm that made the final privilege review
and disclosure determinations billed Verizon $5.4 million in privilege
review hours.75 In total, Verizon spent $7.7 million on outside services to
66. See id. at 200 (testimony of Richard J. Wolf).
67. See Radian Asset Assurance, Inc. v. Col. of Christian Bros. of N.M., No. CIV 090885 JB/DJS, 2010 WL 4928866, at *4 (D.N.M. Oct. 22, 2010) (noting the high costs that
would be involved in a privilege review of 135 hard drives before ordering disclosure under
a Rule 502(d) order); Hopson v. City of Baltimore, 232 F.R.D. 228, 232 (D. Md. 2005)
(noting that the case “vividly illustrates one of the most challenging aspects of discovery of
electronically stored information” and that fear of the consequences of inadvertent waiver
might add cost and delay for all parties).
68. New York Hearing, supra note 2, at 82 (testimony of Patrick Oot, Senior Litigation
Counsel at Verizon Wireless Inc.).
69. Id. at 83.
70. Id.
71. Id. at 83–84.
72. Id. at 84.
73. Id. at 84–85.
74. Id. at 86.
75. Id.
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conduct a thorough privilege review in one matter, in one year, exclusive of
additional internal costs.76 Moreover, Mr. Oot testified that Verizon
frequently has matters where the amount at issue is around $20 million and
the privilege review costs remain in the millions.77
Like the document that harms the producing party despite its
inadmissibility, these costs—or the threat thereof—can be used by an
opposing party as leverage in settlement negotiations early in a case
because a party may be more likely to resolve the dispute through
settlement than to bear the significant costs of litigation. For example, if
Verizon knows it can reduce its cost of privilege review by half, saving
millions of dollars, that cost reduction marginally shifts the cost-benefit
balance of settling versus litigating a matter. A Rule 502(d) protective order
can significantly reduce the leverage possessed by a litigant whose
adversary must expend disproportionately greater costs during discovery by
reducing the requisite sunk costs associated with ongoing litigation.
Ann Kershaw, a litigation consultant, testified that Rule 502(d) allows
costs savings related to an entirely separate category of documents. She
stated that many times a discovery request may call for a batch of
documents that contains privileged communications relating to a prior
matter the client no longer cares about.78 The substantive communication
may not harm the client in the pending litigation, but a waiver could be
detrimental in unforeseen subsequent matters. Rule 502(d) allows the client
to forego privilege review altogether and save the costs otherwise incurred
to protect separate issues irrelevant to the pending case.79
Further, Ms. Kershaw, testifying alongside Mr. Oot, stated that Rule
502(d) is one of the most important devices to address the concerns raised
by scenarios like Verizon’s, which occur across the country in state and
federal courts.80 She raised the important point that Rule 502(d) allows the
privilege holder to craft an appropriate review process for each individual
case without fear that a disclosure could potentially reach the hands of other
litigants in other actions throughout the United States in which the client
finds itself in litigation.81 This point was reiterated by Anthony
Tagliagambe, who, as a panel member of the Federation of Defense and
Corporate Counsel, spoke on behalf of many tort defense attorneys whose
clients may have exposure in all fifty states.82 To these attorneys,
76. Id. at 86–88 (noting that total cost of protecting privilege in that case was $13
million).
77. Id. at 88.
78. Id. at 94 (testimony of Ann Kershaw, litigation management consultant).
79. See id. at 99 (stating that “the rule would provide limitations and protections that
allow us to negotiate reasonable, less expensive, and less time-consuming review
processes.”).
80. Id. at 90.
81. Id. at 90, 101.
82. Id. at 186–88 (testimony of Anthony Tagliagambe, partner, London Fischer LLP).
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
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predictability and certainty were the most important issues for rules on
privilege and waiver to address. Disclosure carries risk in the given case,
but it is a controlled and known risk. Knowing this risk would save a
company like Verizon in the above-described litigation millions of
dollars.83 Thus, regarding the attorney-client privilege, certainty is of prime
importance.
Nearly all of the suggested attributes mentioned in these preceding
testimonies made their way into either the text of the rule or the advisory
committee’s notes:
1) certain protection against privilege waiver;84
2) controlling effect in state and federal courts;85
3) controlling effect in future litigation;86 and
4) unilateral invocation of the rule without party agreement.87
As we shall see, the Committee shaped Rule 502(d) so that the rule also
retained an inherent flexibility, allowing parties to utilize the rule’s
protections without foregoing any review if they wish.
III. THE TEXT OF THE RULE AND COMMENTS GUIDING ITS APPLICATION
Rule 502, as enacted, changed little from the proposal. The text and
advisory committee’s notes make clear the Committee’s intentions for each
of the provisions. As we will see below, many parties are simply relying on
the standard of Rule 502(b) in their protective orders; the case law makes
clear that this is a false assurance.88 However, the text of the rule, the
congressional record, and notes to Rule 502(d) and (e) clarify that these
provisions were intended to 1) assure parties that they were protected if
they chose to reduce costs through a less vigorous privilege review; 2)
provide parties with the option to insulate one’s self from judicial scrutiny
of privilege review procedures; or 3) simply allow parties to utilize the
protections to gain complete protection from unintentional waiver.89 The
uncertainty surrounding the protections of subsection (b) implicates the
wisdom and necessity of utilizing the protection of subsection (d).
Rule 502(d) is the heart of the new rule. Congress articulated two
purposes for Rule 502: cost reduction and predictability.90 Subsection (d)
83. Id. at 102 (testimony of Patrick Oot).
84. FED. R. EVID. 502(b).
85. FED. R. EVID. 502(a)–(b).
86. FED. R. EVID. 502(d).
87. FED. R. EVID. 502(d) advisory committee’s note.
88. See discussion infra Part IV.
89. See FED. R. EVID. 502; FED. R. EVID. 502 advisory committee’s note; 154 CONG.
REC. 2776–78 (2008).
90. 154 CONG. REC. 2776 (2008) (statement of Sen. Leahy).
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furthers both of these goals. It promotes cost reduction by dictating that a
protective order can eliminate disclosure-based privilege waiver, thereby
making feasible lower-cost privilege review, and it promotes predictability
by providing that a non-waiver agreement embodied in a court order is
enforceable in any state or federal proceeding.91 Once again, it provides:
(d) CONTROLLING EFFECT OF A COURT ORDER.—A Federal court may
order that the privilege or protection is not waived by disclosure
connected with the litigation pending before the court—in which event the
disclosure is also not a waiver in any other Federal or State proceeding.92
Unlike 502(b), subsection (d) does not require any proof of inadvertence or
that reasonable steps were taken to prevent disclosure.93 It simply allows
courts to order that privilege will not be waived due to a party’s disclosure
of privileged information.
Also, the advisory committee’s notes and subsection (f) indicate
that Rule 502(d) can be utilized in a variety of circumstances. A
confidentiality order from the court is enforceable in all proceedings
whether or not it reflects an agreement between the parties.94 Further, courts
can provide for the return of privileged documents “irrespective of the care
taken by the disclosing party.”95 In addition, Rule 502(f) provides assurance
that the rule will be applicable in multiple fora, even when state law
provides the rule of decision. In other words, parties can utilize Rule 502(d)
orders in diversity cases or court-mandated arbitration proceedings. Thus,
parties can unilaterally move for the order in federal court, and they can
eliminate any scrutiny of their privilege review procedures. They can do so
regardless of the basis on which they find themselves in federal court.
Additionally, parties can have that order continue to control the disclosures
made related to the federal proceeding if they find themselves in state court.
One must ask, however, what a party must do to ensure the benefits of
Rule 502(d)’s protections. Rule 502(e) begins to address this. It states:
(e) CONTROLLING EFFECT OF A PARTY AGREEMENT.—An agreement on
the effect of disclosure in a Federal proceeding is binding only on the
parties to the agreement, unless it is incorporated into a court order.96
91. 154 CONG. REC. 2777 (2008) (explanatory note on Rule 502 of the Federal Rules
of Evidence).
92. FED. R. EVID. 502(d).
93. See FED. R. EVID. 502(b) (stating that privilege shall not be waived in the event of
an inadvertent disclosure provided that reasonable steps were taken to prevent the
disclosure).
94. FED. R. EVID. 502(d) advisory committee’s note.
95. Id.
96. FED R. EVID. 502(e).
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
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Thus, not all non-waiver agreements are enforceable against non-parties. If
parties want to enforce a non-waiver provision against third parties, a court
must enter an order.97 Moreover, parties arguably need to specifically
contemplate either Rule 502(d) or track its language.98
The advisory committee’s notes support this requirement by stating that
“[t]he rule makes clear that if parties want protection against non-parties
from a finding of waiver by disclosure, the agreement must be made part of
a court order.”99 This language indicates that an order must specify the
order’s application beyond the litigation before the court. Also, practically
speaking, a party seeking protection will be asking one court to determine
the scope of another court’s order. If the first court’s order does not
specifically contemplate the order’s enforceability on non-parties, a later
court may find reason to determine that it is inapplicable.
On the other hand, one might argue that the court’s entry of an order is
itself a signal of enforceability on third parties. After all, the rule’s language
states that “[a] Federal court may order that . . . privilege . . . is not
waived . . . in which event” such an order shall be binding in any other
proceeding.100 At the very least, there are arguments on both sides as to a
protective order’s de facto enforceability on third parties when the order
does not cite to Rule 502(d). Parties seeking clear protection against waiver,
however, would be much safer explicitly invoking Rule 502(d) in a court
order.
The Committee and Congress clearly intended for Rule 502(d), in
conjunction with the other provisions, to substantially assist in reducing the
costs of litigation related to privilege review. Indeed, the advisory
committee’s notes specifically contemplate the idea raised by Judge
Schiendlin in Zubalake v. UBS Warburg LLC, that an order could “allow
the parties to forego privilege review altogether.”101 Rule 502(d) responds
to the concern that disclosure could waive privilege in future proceedings,
especially those in different jurisdictions, as well as the concern that
clawback agreements embodied in court orders were not fully protective
against a motion to compel by a third party.102
97. FED. R. EVID. 502(d) advisory committee’s note.
98. See United States v. Cinergy Corp., No. 1:99-cv-01693-LJM-JMS, 2009 U.S. Dist.
LEXIS 126820, at *7–8 (S.D. Ind. Nov. 10, 2009) (finding waiver under Rule 502 where a
protective order, which was entered before Rule 502(d), did not specifically exempt from
discovery inadvertently disclosed documents despite containing a “sort of claw-back
provision” that allowed a party to retrieve documents not labeled “confidential
information”).
99. FED. R. EVID. 502(e) advisory committee’s note.
100. FED. R. EVID. 502(d).
101. FED. R. EVID. 502(d) advisory committee’s note (citing Zubulake v. UBS Warburg
LLC, 216 F.R.D. 280, 290 (S.D.N.Y. 2003)).
102. FED. R. EVID. 502(d) advisory committee’s note.
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Rule 502(d) does not provide absolute protection, however.
Importantly, if the disclosure occurs in a separate proceeding than the one
in which the order was entered, a Rule 502(d) order would not protect
against waiver.103 With that said, one could argue that if the disclosure
occurs during simultaneous, related litigation—where the disclosure was
“in connection with” the federal proceeding—the 502(d) order would
control.104 The text of the rule and the advisory committee’s notes indicate
that parties, and even courts, acting sua sponte, have wide latitude to use
Rule 502(d) orders.105 Those orders can provide the predictability and
certainty that Rule 502(b), standing on its own, does not.106
Rule 502(d) orders are necessary, in part, because Rule 502(b) only
begins to standardize privilege-waiver doctrine. Nonetheless, Rule 502(b)
attempts to standardize the analysis of whether a party waives attorneyclient privilege when it inadvertently produces privileged material during
discovery.107 Congress enacted subsection (b) to “resolve[] some
longstanding disputes in the courts about the effect of certain disclosures of
communications or information protected by the attorney-client privilege or
as work-product—specifically those disputes involving inadvertent
disclosure[.]”108 As a reminder, it states:
(b) INADVERTENT DISCLOSURE.—When made in a Federal proceeding or
to a Federal office or agency, the disclosure does not operate as a waiver
in a Federal or State proceeding if:
(1) the disclosure is inadvertent;
(2) the holder of the privilege or protection took reasonable steps to
prevent disclosure; and
(3) the holder promptly took reasonable steps to rectify the error,
including (if applicable) following Federal Rule of Civil Procedure
26(b)(5)(B).109
The rule does not provide the definition of either “inadvertent” or
“reasonable steps,” but the advisory committee’s notes provide useful
guidance.
Prior to Rule 502(b), courts were in conflict over the consequences of
an inadvertent disclosure of privileged material.110 The most lenient
103. Id.
104. 154 CONG. REC. S1317 (daily ed. Feb. 27, 2008) (statement of Sen. Leahy).
105. See FED. R. EVID. 502(d); FED. R. EVID. 502(d) advisory committee’s note.
106. See FED. R. EVID. 502(d) advisory committee’s note.
107. FED. R. EVID. 502(b) advisory committee’s note.
108. FED. R. EVID. 502 advisory committee’s note.
109. FED. R. EVID. 502(b).
110. Compare In re Sealed Case, 877 F.2d 976, 980 (D.C. Cir. 1989) (holding that an
inadvertent disclosure waives the privilege), with Berg Elec., Inc. v. Molex, Inc., 875 F.
Supp. 261, 263 (D. Del. 1995) (holding that an inadvertent disclosure did not waive the
privilege). See generally Hopson v. City of Baltimore, 232 F.R.D. 228 (D. Md. 2005)
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159
approach, which the Eighth Circuit followed, required either intentional
relinquishment of the privilege or that the inadvertent disclosure resulted
from gross negligence.111 The strict approach occupied the other end of the
spectrum and justified waiver on the grounds that confidentiality, once lost,
can never be restored.112 Rule 502 codifies the middle-ground balancing
approach that had predominated in federal courts prior to its enactment.113
This approach is based on a multi-factored test.114 Those factors
include: 1) the reasonableness of the precautions taken; 2) the time taken to
rectify the error; 3) the scope of discovery; 4) the extent of disclosure; and
5) the overriding issue of fairness.115 The advisory committee’s notes make
clear that these considerations are not exhaustive and that no single factor is
dispositive.116 Importantly, however, the advisory committee’s notes clarify
that 502(b)(3), regarding the steps taken to rectify the error, does not
impose a burden on the producing party “to engage in a post-production
review to determine whether any protected communication or information
has been produced by mistake.”117 But the Rule requires a party to follow
up on obvious indications that protected information has been produced
unintentionally, such as when the document is presented at a deposition.118
Rule 502(b) operates as the default rule when privileged information is
disclosed, and litigants have been puzzlingly unaware of the additional
protections they forego when they rely upon its application rather than
invoke Rule 502(d).119
(noting that the disclosure should not be considered a waiver of all privileged matters).
111. Hopson, 232 F.R.D. at 235–36 (describing the different approaches); EDNA SELAN
EPSTEIN, THE ATTORNEY-CLIENT PRIVILEGE AND THE WORK-PRODUCT DOCTRINE 310–11 (4th
ed. 2001).
112. In re Sealed Case, 877 F.2d at 980.
113. The advisory committee’s notes cite to Lois Sportswear, U.S.A., Inc. v. Levi
Strauss & Co., 104 F.R.D. 103, 105 (S.D.N.Y. 1985) and Hartford Fire Ins. Co. v. Garvey,
109 F.R.D. 323, 332 (N.D. Cal. 1985), which both set forth the five-factor balancing
approach followed by the majority of courts.
114. See Victor Stanley, Inc. v. Creative Pipe, Inc., 250 F.R.D. 251, 259 (D. Md. 2008).
115. FED. R. EVID. 502(b) advisory committee’s note; see also Heriot v. Byrne, 257
F.R.D. 645, 658–59 (N.D. Ill. 2009); SEC v. Badian, No. 06 Civ. 2621-LTS/DFE, 2009 U.S.
Dis. LEXIS 9204, at *8–9 (S.D.N.Y. Jan. 26, 2009) (discussing the “Lois factors” to
determine whether privilege had been waived in disclosures made to the SEC). See generally
Callan v. Christian Audigier, Inc. 263 F.R.D. 564 (C.D. Cal. 2009) (requiring the party
seeking a protective order to affirmatively set forth the procedures used to review documents
for privilege prior to their production and holding that the party’s failure to do so justified a
finding of waiver despite the existence of a protective order).
116. FED. R. EVID. 502(b) advisory committee’s note.
117. Id.
118. Id.
119. Some commentators have even advocated for courts to refuse to enter Rule 502(d)
orders when they reflect “irrespective of care” agreements on the grounds that such
agreements are against public policy. See generally Jessica Wang, Comment, Nonwaiver
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By enacting Rule 502, Congress—as evidenced from the text of the
rule, the advisory committee’s notes, and congressional history— hoped to
reduce the cost of litigation by reducing the consequences of inadvertent
disclosure of privileged materials in federal court and permit parties to
further reduce costs by increasing certainty through protective orders that
eliminate the risk of waiver-by-disclosure altogether.120 In this sense, the
rule is quite ambitious.
Its default provision, Rule 502(b), does some of the work by attempting
to standardize the test applied to waiver.121 However, the reasonableness
standard in subsection (b), just as with any factor-based test, is subject to
different courts and different judges ascribing varying weights to each
factor depending on the circumstances of each unique case. As a result, a
particular judge’s ruling on a waiver issue may not be predictable from case
to case. This uncertainty hinders cost reduction.
Rule 502(d) accomplishes what 502(b) does not. It ensures that a
privileged disclosure will not constitute waiver when a federal court has
entered an order pursuant to its protections.122 Further, Rule 502(d) provides
the very important protection against waiver in other proceedings, including
state courts.123 It also allows parties to obtain this protection without
gaining the consent of opposing parties.124 As we will see, these critical
protections have been largely overlooked by both critics of the rule’s
effectiveness as well as litigants that have not taken advantage of this
valuable tool.
IV. RULE 502(B) CREATES A MORE CERTAIN, BUT STILL UNCERTAIN,
WORLD
To understand the value of utilizing Rule 502(d) orders in any litigation
regardless of a client’s interest in cost-savings, one must understand the
uncertainty that otherwise exists with respect to protecting privilege even
after Congress’s attempt at standardization through Rule 502(b). Clients are
well aware of the costs of the extensive privilege review that is necessary to
Agreements After Federal Rule of Evidence 502: A Glance at Quick-Peek and Clawback
Agreements, 56 UCLA L. REV. 1835 (2009) (arguing that courts should apply Rule 502(b)’s
reasonableness standard to agreements that seek to avoid waiver “irrespective of the care”
taken to prevent the disclosure, as the comments to the Rule explicitly provide). However,
this view improperly disregards that Congress is responsible for democratically reflecting
public policy, and it did so here when it enacted Rule 502(d). Thus, Congress determined
that the public policy in favor of reducing litigation costs outweighed other public policy
considerations.
120. FED. R. EVID. 502 advisory committee’s note.
121. See FED. R. EVID. 502(b) advisory committee’s note.
122. FED. R. EVID. 502(d) advisory committee’s note.
123. Id.
124. Id.
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avoid results similar to those in Hopson v. City of Baltimore125 and Victor
Stanley, Inc. v. Creative Pipe, Inc.126 One might argue that Rule 502(d)
orders are unnecessary for a party unwilling to forego a full-blown privilege
review because, to them, the cost in merely disclosing the privileged
communication outweighs the cost-savings achieved through a more
limited, targeted privilege review. This argument wrongly presumes a
perfect world where privileged documents never get disclosed despite the
most critical review by diligent attorneys, and it ignores the still greater cost
of an opposing party’s ability to use the damaging privileged document in
the event a court finds waiver under Rule 502(b). An analysis of the case
law reveals that a party can never be certain that a particular court or a
particular judge, analyzing a disclosure for waiver under Rule 502(b), will
protect a privileged document that has been inadvertently disclosed.
A. The Pre-Rule 502 Foundation: The Lasting Effect of Hopson and Victor
Stanley
The Hopson v. City of Baltimore and Victor Stanley, Inc. v. Creative
Pipe, Inc. cases are well-known to attorneys who dread the possibility of
waiving privilege because a court finds that the steps taken to prevent the
inadvertent disclosure during the review process were insufficient.127
Though both opinions were written prior to Rule 502, a brief review of
those holdings will help establish a baseline so we may better understand
the subsequent cases that have followed Rule 502(b) and applied the
analyses from both Hopson and Victor Stanley. After all, Hopson is cited in
the advisory committee’s notes to subsection (d), and Victor Stanley’s
reasonableness test heavily influences the analysis of subsection (b) when
parties forego entry of a Rule 502(d) order. Both cases ultimately help
define when a court will find waiver from inadvertent disclosure for
purposes of Rule 502(b). The unpredictability of that analysis reveals the
necessity of Rule 502(d).
Hopson addresses both the cost and uncertainty problems that Rule 502
was intended to help cure. In Hopson, Judge Grimm analyzed objections to
discovery requests made in part because of defendants’ complaints about
the prohibitive costs they would have to incur reviewing the production for
attorney-client privilege.128 He noted the ability of parties to agree among
themselves that inadvertent production of privileged material would not
constitute privilege waiver (a so-called “clawback agreement”),129 and he
125. 232 F.R.D. 228, 231 (D. Md. 2005).
126. 250 F.R.D. 251, 255 (D. Md. 2008); see also New York Hearing, supra note 2, at
102 (testimony of Patrick Oot).
127. Victor Stanley, 250 F.R.D. at 253–54; Hopson, 232 F.R.D. at 244.
128. Hopson, 232 F.R.D. at 231.
129. Id. at 234 n.9 (quoting Zubulake v. UBS Warburg LLC, 216 F.R.D. 280, 290
(S.D.N.Y. 2008)).
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noted that the proposed amendment to Rule 26(f) of the Federal Rules of
Civil Procedure provided a mechanism by which courts could adopt such
agreements in an order.130 But Judge Grimm also recognized that “[a]bsent
a definitive ruling on the waiver issue, no prudent party would agree to
follow the procedures recommended in [Rule 26(b)(5)(B) of the Federal
Rules of Civil Procedure].”131 His point was that the state of the law on
privilege waiver did not concretely protect parties from waiver even when
the new Federal Rule of Civil Procedure 26(b)(5)(B) provided that a party
could assert privilege over information, even after disclosure, because such
assertion remained subject to a court’s determination of the privilege waiver
claim.
After lamenting the uncertain state of the law concerning non-waiver
agreements, Judge Grimm went on to address the amount of privilege
review that would be required for the extensive ESI requested.132
Ultimately, he ordered the disclosures to be produced within a “reasonable
time.” While this standard might not have allowed for full review, Judge
Grimm reassured the disclosing party that it would retain the argument in
subsequent courts “that their production of privileged information was
under the erroneous belief that [the] order immunized them from
waiver[.]”133
Judge Grimm’s order in Hopson is not exactly the most comforting
order for a litigant in the disclosing party’s shoes; in fact, it screams for the
clarity now provided by Rule 502(d). But the value of a Rule 502(d) order
is even more fully reinforced in Judge Grimm’s later analysis in Victor
Stanley of the “reasonable steps” a party must take to prevent inadvertent
disclosure in order to avoid waiver.134
The Victor Stanley opinion came about after defendants decided that
the use of a clawback agreement was unnecessary because they planned to
conduct a document-by-document privilege review by using keyword
searching to cull out potentially privileged documents.135 Defendants’
attorneys used seventy keywords to conduct the search and thereafter
reviewed the flagged documents for privilege.136 Following defendants’
privilege review and subsequent disclosure, plaintiffs had in their
possession 165 privileged documents (out of the tens-of-thousands of
documents actually produced) that the defendants claimed were privileged
and unintentionally produced.137 The court employed the five-factor
balancing test (discussed above), which has been suggested for inclusion in
130.
131.
132.
133.
134.
135.
136.
137.
Id. at 234–35.
Id. at 234.
Id. at 231.
Id. at 246.
See Victor Stanley, 250 F.R.D. at 259.
Id. at 254–55.
Id. at 255–56.
Id. at 257.
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any Rule 502(b) analysis.138 Judge Grimm held that the keyword search
utilized by the attorneys was not reasonable, and therefore, they were not
insulated from privilege waiver.139
Of particular interest in assessing the value of a Rule 502(d) order are
Judge Grimm’s respective discussions of the ineffectiveness of keyword
searching, the need for employing experts to test the validity of the search,
and the explicit statement that all of these problems could be avoided—
even in a pre-Rule 502 world—by the use of a court-approved non-waiver
agreement.140 Judge Grimm highlighted the increasingly well-known
limitations of keyword searching and emphasized that it is the privilege
claimants’ burden to prove the reasonableness of the search.141 Among the
shortcomings of defendants’ proof of reasonableness was the lack of
qualifications of the attorneys to conduct the review.142 Judge Grimm wrote
that “proper selection and implementation obviously involves technical, if
not scientific knowledge.”143 He then went on to cite a number of cases
encouraging the use of experts in designing an adequate search
methodology.144 Judge Grimm, however, did not go so far as to say that use
of an expert would necessarily be a sufficient step to protect against waiver.
Failing to heed Judge Grimm’s advice on any ESI production adds
uncertainty to adequate attorney-client privilege protection under Rule
502(b)’s reasonableness-based standard. Yet, even prior to the availability
of a Rule 502(d) order, Judge Grimm explicitly stated that a court-ordered
clawback or non-waiver agreement would have secured the privilege for
defendants in the Victor Stanley case.145
B. Post-Rule 502 Cases
Analysis of inadvertent disclosure and waiver remains largely
unchanged; Rule 502(b) adopted the majority approach to waiver caused by
inadvertent disclosure.146 Many post-Rule 502 cases still base their analysis
on Victor Stanley or on the similar factors found in the notes to Rule
138. Id. at 259; see also FED. R. EVID. 502(b) advisory committee’s note (setting forth a
non-exhaustive list of factors to consider).
139. Victor Stanley, 250 F.R.D. at 262–64.
140. See id. at 261 n.10.
141. Id. at 259–60.
142. Id. at 259.
143. Id. at 260.
144. Id. (citing United States v. O’Keefe, 537 F. Supp. 2d 14, 24 (D.D.C. 2008)).
145. See id. at 262 (noting that the defendants would have been insulated from waiver
had they not voluntarily abandoned their request for a protective order).
146. Kmart v. Footstar, No. 09-C-3607, 2010 WL 4512337, at *3 (N.D. Ill. Nov. 2,
2010) (noting that the adoption of Rule 502(b) did not change the inadvertent disclosure
analysis, at least for those courts that previously utilized the five-factor approach from Victor
Stanley).
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502(b).147 Lack of change should not be mistaken for clarity, however. Rule
502 does not define either “inadvertent” or “reasonableness,” and as the
post-Rule 502 cases reveal, definitions may shift depending on the
courtroom.148 Some uncertainty exists regarding inadvertence, which is the
first step in the Rule 502(b) analysis. Additionally, the definition of what
steps are reasonable to prevent disclosure is even more unpredictable.
Some courts have held that Rule 502(b) invites a very simple analysis
of whether a document was disclosed inadvertently.149 Under this approach,
courts question whether the party intended to disclose the privileged or
work-product protected document or whether it was disclosed by
mistake.150 This test is facially appealing. A party satisfies Rule 502(b)(1) if
it simply did not intentionally disclose the protected information. In Kmart
v. Footstar, for example, the court opted for this test after noting that some
courts in the same district had applied various factors when determining
inadvertence.151 In Kmart, because the parties did not dispute that the
disclosure was made by mistake, the analysis was straightforward. Thus,
the disclosure was inadvertent, and the first step was satisfied.152 However,
one could envision a dispute over a party’s intent when making such a
disclosure, which may lend credence to an objective factor-based analysis
that is less reliant on a party’s claimed state of mind at the time of
disclosure.
A different case out of the same jurisdiction employed such an
objective approach to inadvertence. Heriot v. Byrne analyzed factors
including the total number of documents reviewed, the procedures used to
review the documents prior to production, and the actions of the party after
discovering the production of privileged materials.153 The court also
considered the scope of discovery and the extent of the disclosure.154
Despite disclosing 196 privileged documents out of a total of 1,499 that the
party reviewed and produced—roughly thirteen percent—the court held that
the plaintiffs’ production was inadvertent.155 The court found that the
plaintiffs’ immediate attempts to rectify their ESI vendor’s mistake
outweighed the significant percentage of privileged documents produced.156
147. Felman Prod., Inc. v. Indus. Risk Insurers, No. 3:09-0481, 2010 WL 2944777, at
*3 (S.D. W. Va. July 23, 2010).
148. See Sidney I. v. Focused Retail Prop. I, LLC, 274 F.R.D. 212, 216 (N.D. Ill.
2011); Multiquip, Inc. v. Water Mgmt. Sys. LLC, No. CV 08-403-S-EJL-REB, 2009 WL
4261214, *4–5 (D. Idaho Nov. 23, 2009).
149. See, e.g., Kmart, 2010 WL 4512337, at *5.
150. See id. at *3 (citing Coburn Group, LLC v. Whitecap Advisors, LLC, 640 F. Supp.
2d 1032, 1038 (N.D. Ill. 2009)).
151. Id.
152. Id.
153. Heriot v. Byrne, 257 F.R.D. 645, 658–59 (N.D. Ill. 2009).
154. Id. at 659.
155. Id. at 660.
156. Id. (discussing the efforts made to immediately notify counsel of the mistake upon
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As the court in Kmart noted, however, it is somewhat duplicative to use
these factors to determine inadvertence when Rule 502(b) requires their use
later in the waiver analysis.157 The differing approaches at the first step add
one more layer of uncertainty. Courts may employ a subjective test of intent
or the more objective factor-based examination, even within the same
courthouse.
Courts also differ in their application of the second step of the Rule
502(b) analysis—the reasonableness of the steps taken to prevent
inadvertent disclosure. Under Rule 502(b)(2), a disclosure will not operate
as a waiver if the steps taken to prevent the disclosure were reasonable.158
For example, an attorney’s personal review of a 4,500 page disclosure with
an “eye toward identifying any attorney-client privilege or work-product
issues” was insufficient for a court to conclude that the review procedures
were reasonable.159 On the other hand, when a team of sixteen associates,
supervised by two senior associates, spent about 2,500 hours reviewing
more than 50,000 documents, a district court in Kansas found that the
review procedures were reasonable.160 Given these inconsistencies, it is
apparent that there is no clear standard to determine at what point an
attorney crosses from “unreasonable” to “reasonable” review. This lack of
clarity exists even when courts are applying the same legal standard.
Some courts more stringently apply Rule 502(b)’s reasonable steps
standard. These courts interpret reasonableness in a manner that closely
resembles a pre-Rule 502 standard of strict waiver.161 For example, shortly
after Rule 502 took effect, an Oregon district court held in Relion v. Hydra
Fuel Cell Corp. that privilege was waived after the disclosing party failed
to “pursue all reasonable means of preserving the confidentiality of the
privileged matter.”162 The full document production in Relion occupied
nearly forty feet of shelf space and was reviewed by attorneys and support
staff.163 Two e-mails containing privileged material were eventually found
in the documents produced by the plaintiff.164 Perhaps most troubling is that
the Oregon court’s analysis, which cited Rule 502(b), pointed to the fact
learning of it and claiming privilege).
157. Kmart v. Footstar, Inc., No. 09-C-3607, 2010 WL 4512337, at *3 (N.D. Ill. Nov.
2, 2010); see also FED. R. EVID. 502(b)(3) (directing courts to look at whether the party
asserting privilege took reasonable steps to rectify the error in addition to determining
whether the disclosure was inadvertent).
158. FED. R. EVID. 502(b)(2).
159. Kmart, 2010 WL 4512337, at *4.
160. Sheet Metal Workers’ Nat’l Pension Fund v. Palladium Equity Partners, LLC, 722
F. Supp. 2d 845, 851 (E.D. Mich. 2010).
161. See Relion, Inc. v. Hydra Fuel Cell Corp., No CV06-607 HU, 2008 WL 5122828,
at *2 (D. Or. Dec. 4, 2008) (discussing a pre-Rule 502 case in the Ninth Circuit that held the
objective fact of disclosure to constitute waiver).
162. Id. (emphasis added).
163. Id. at *3.
164. Id.
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that the disclosing party had actually reviewed the documents in support of
its waiver ruling.165 In addition, the court found that the disclosing party had
in its possession a hard copy of all the documents that were disclosed, and
its failure to review the hard copies after the disclosure warranted a finding
of waiver.166 The advisory committee’s notes specifically state that Rule
502 does not impose a burden to engage in post-production review;167
therefore, the court’s reliance on the lack of post-production review is
somewhat untethered from the rule itself.
Relion is atypical in its exacting requirements for non-waiver. But it
illustrates the possibility that a court may have a distinct view of the steps
one should take to protect against disclosure of privileged materials. It also
highlights the fact that mistakes can occur in even a very thorough privilege
review, which may ultimately result in privilege waiver.
Those looking to make an argument for non-waiver can find hope in
Rhoads Industries v. Building Materials Corp. of America.168 In that case,
the court went through the five-factor analysis suggested in the advisory
committee’s notes for Rule 502(b) and found that the disclosing party’s
efforts were not reasonable.169 In doing so, the court held that all of the first
four factors in the balancing test favored waiver.170 Nonetheless, the court
criticized the hindsight-based analysis in Victor Stanley and held that the
interests of justice favored a finding of non-waiver for the more than nine
hundred documents that were inadvertently produced during discovery.171
Moreover, the court made its ruling with “little knowledge of the content”
of the privileged materials;172 thus, there was no special consideration of
justice due to differentially prejudicial privileged communications. The
court found that justice called for maintenance of the attorney-client
privilege.
This brief review of the case law regarding disclosure-based privilege
waiver is intended to point out the uncertainty that remains even after the
enactment of Rule 502. In Victor Stanley, for example, Judge Grimm called
for litigants’ use of experts in computer technology, statistics, and
linguistics to analyze the reasonableness of keyword searching and was
165. Id. (stating that “Relion’s discovery documents were inspected by attorneys and
support staff at Wells St. John before they were produced” and that “Relion did not pursue
all reasonable means of preserving the confidentiality of the documents produced to Hydra,
and therefore . . . the privilege was waived.”).
166. Id. (pointing out this additional opportunity to take steps to preserve
confidentiality).
167. FED. R. EVID. 502(b) advisory committee’s note.
168. 254 F.R.D. 216 (E.D. Pa. 2008).
169. Id. at 226–27.
170. Id. at 226.
171. Id. at 225, 227.
172. Id. at 227.
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quick to find that privilege had been waived.173 However, the Rhoads
Industries court was reluctant to find a waiver of privilege due to an
overriding concern for justice.174 These cases provide useful arguments for
parties arguing on either side of a motion to compel. Rule 502(b) merely
gives courts a uniform set of initial considerations. However, it provides
little assurance that a thorough and efficient, if imperfect, privilege review
process will withstand a particular judge’s scrutiny. As such, structuring a
privilege review that will be both cost-effective for a client and rigorous
enough to concretely ensure protection remains a gamble.
V. THE SOLUTION: RULE 502(D)
In addition to the optional benefit of cost reduction through tailored
privilege review, Rule 502(d) orders automatically remove the uncertainty
of Rule 502(b) because the inherently unpredictable reasonableness analysis
is completely removed. Inadvertent production of privileged
communications is inevitable, and the large number of cases addressing this
issue makes that clear.175 The high costs associated with document-bydocument privilege review to prevent accidental disclosure are also clear.
Parties incur additional costs litigating the consequences of an inadvertent
disclosure. For example, one side may want the document admitted into
evidence; whereas, the other will fight vigorously to ensure it remains
privileged. These costs, however, are at least partially avoidable.
Parties have at their fingertips a tremendous tool to address these
various problems. A Rule 502(d) protective order can act as a shield against
waiver when privileged documents are accidentally produced even after a
thorough review. It can also allow parties to tailor various levels of
privilege review for a particular case without fear that a mistake will result
in widespread damage. Rule 502(d) provides a clear-cut rule to determine
whether a document’s production will result in waiver—it will not. It
thereby reduces or eliminates the costs of litigating waiver resulting from
an inadvertent disclosure. The few cases that have addressed Rule 502(d)
demonstrate that it is an effective tool when parties invoke its protection
properly. To be sure, courts are beginning to make frequent use of Rule
502(d) in order to limit the potential discovery disputes during litigation.176
173. See Victor Stanley, Inc. v. Creative Pipe, Inc., 250 F.R.D. 251, 260 (D. Md. 2008).
174. Rhoads, 254 F.R.D. at 219.
175. See supra Part IV.B; see also Sidney I. v. Focused Retail Prop. I, LLC, 274 F.R.D.
212, 216–18 (N.D. Ill. Mar. 30, 2011) (discussing the two different tests applicable to the
inadvertence prong of Rule 502(b) and holding that the plaintiffs did not take reasonable
steps to protect against disclosure of the privileged documents); Multiquip, Inc. v. Water
Mgmt. Sys. LLC, CV 08-403-S-EJL-REB, 2009 WL 4261214, at *5–6 (D. Idaho Nov. 23,
2009) (holding that a litigant’s care, though “hasty and imperfect[,]” was reasonable and
therefore did not waive privilege).
176. See infra Part V.A.
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This practice reduces costs, which is exactly what Congress had in mind
when it enacted the rule.177
A. Courts Using Rule 502(d) Orders
Courts are beginning to invoke Rule 502(d) in conjunction with orders
on motions to compel. For example, a Texas district court used a Rule
502(d) order to protect a plaintiff against privilege waiver in separate
litigation where the documents were required in the case before the court.178
In Whitaker, Chalk, Swindle & Sawyer, LLP v. Dart Oil & Gas Corp., a law
firm filed suit for unpaid legal fees against a former client.179 The claim
arose out of the law firm’s representation and billing in litigation that
remained ongoing in a Texas state court.180 The client sought to stay the
federal proceedings and to be relieved of Rule 26(a) disclosure obligations
because it feared that disclosures in the fee dispute litigation would waive
privilege for those documents in the state court litigation.181 In response to
plaintiff’s argument that Rule 502(d) would address the former client’s
concerns, the former client argued that Rule 502(d) “is limited to
inadvertent disclosures.”182 The court correctly held that it was within the
court’s authority under Rule 502(d) to order that any disclosure of
privileged information would not result in waiver in the state proceeding.183
The client also expressed concern that the state court might not honor
the federal court’s order, but Judge Means saw no reason that a state court
would not respect the order.184 Accordingly, the court entered the following
provision in its order: “The attorney-client privilege and work-product
privilege are not waived by the disclosure of confidential privileged
communications and information related to the Esperada suit pursuant to
this order and Federal Rule of Evidence 502.”185 Given the court’s explicit
reference to Rule 502 and discussion of subsection (d), it is clear that this
order invoked its protections.
Courts even invoke Rule 502(d) when attorney-client privilege or workproduct protection is not central to the dispute. In Northern Natural Gas v.
L.D. Drilling, a discovery dispute arose over production of trade secrets,
177. See supra note 4 and accompanying text.
178. Whitaker, Chalk, Swindle & Sawyer, LLP v. Dart Oil & Gas Corp., No. 4:08-CV684-Y, 2009 U.S. Dist. LEXIS 15901, at *2 (N.D. Tex. Feb. 23, 2009).
179. Id. at *1.
180. Id. at *2.
181. Id. at *3.
182. Id. at *9.
183. Id. at *10 (noting its authority under rule 502(d) of the Federal Rules of Evidence).
184. Id. Dart’s concern in this case is not uncommon, and Judge Means’ language may
not be reassuring for an attorney seeking certainty. For a thorough discussion of a state
court’s obligation to respect a federal court’s Rule 502(d) order, see infra Part VI.
185. Whitaker, 2009 U.S. Dist. LEXIS 15901, at *14.
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and the parties could not agree on an appropriate protective order.186 In
resolving the dispute, the court fashioned a protective order to govern the
discovery process.187 The court included a provision in the order that stated,
“Pursuant to Federal Rule of Evidence 502(d), any privilege or protection
shall not be waived by inadvertent disclosure connected with this
Litigation.”188
Rule 502(d) also reduces the consumption of judicial resources
otherwise required to resolve disputes (other than those involving
inadvertent disclosure) regarding disclosure of privileged information. For
example, a party may be more willing to disclose certain documents they
would otherwise claim on a privilege log if the disclosing party could be
assured that the disclosure will not result in waiver in the present litigation
or any other litigation in the future. This will reduce the need for a court to
adjudicate disputes over whether documents may be properly withheld on
grounds of privilege.
In re Avandia Marketing, Sales Practices and Products Liability
Litigation illustrates how the use of Rule 502(d) can achieve this result.189
A special master was appointed to resolve a year-long discovery dispute
over defendant’s assertion of privilege on tens of thousands of
documents.190 After the special master reviewed in camera a sample of 120
documents claimed on the defendant’s privilege log, the defendant agreed
to produce fifty-six of the documents without further litigation of the
matter, provided that the court entered a non-waiver order.191 The 502(d)
order in this case used especially direct and clear language:
GSK's production of the approximately 56 documents, which it agreed to
produce in a September 15, 2009 meeting with the Special Discovery
Master, shall not constitute a waiver of any privilege or protection with
respect to: (a) those documents; (b) any other communications or
documents relating to the subject matter of those documents; or (c) any
other communications or documents relating to the parties who sent or
received or are named in those documents. This Order is, and shall be
construed as, an Order under Rule 502(d) of the Federal Rules of
Evidence ordering that privilege or protection is not waived by disclosure
connected with the litigation pending before this Court. Accordingly, as is
186. Order Granting in Part and Denying in Part Motions for Protective Orders and
Entry of Protective Order at *3, N. Natural Gas Co. v. L.D. Drilling, Inc., No. 08-1400WEB-DWB, 2010 U.S. Dist. LEXIS 8810 (D. Kan. Feb. 1, 2010).
187. Id. at *8–21.
188. Id. at *16 (emphasis in original).
189. Eighth Report and Recommendation of the Special Master as to Documents
Withheld Pursuant to the Attorney-Client Privilege and/or the Work-Product Doctrine, In re
Avandia Mktg., Sales Practices & Products Liab. Litig., No. 1871 07-md-01871-CMR, 2009
U.S. Dist. LEXIS 122246 (E.D. Pa. Oct. 2, 2009).
190. Id. at *1.
191. Id. at *2, *34–35.
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explicitly set forth in Rule 502(d), the production of these documents is not
a waiver of any privilege or protection in any other federal or state
proceeding. Without limiting the foregoing, the existence of this Order
shall not in any way impair or affect GSK's legal right to assert privilege
claims for the documents produced in any other actions, shall not effect
[sic] a waiver, and shall not be used to argue that any waiver of privilege
or protection has occurred by virtue of any production of these documents
in this case before this Court or any other Court or in any other litigation
or proceeding.192
Because Rule 502(d) protects the documents from waiver—provided they
are in fact privileged—the disclosing party can afford to be less
conservative in protecting a document’s secrecy since it has less to lose
from disclosure.
Courts also invoke Rule 502(d) when parties specifically contemplate
producing a set of documents without review. This was exactly the case in
Jicarrilla Apache Nation v. United States, where the United States was
forced to produce more than one million pages of documents that it had
claimed to be privileged.193 The United States, the defendant in this case,
only disclosed the documents after being subject to an order compelling it
to do so.194 The court rejected the defendant’s argument that production
may result in waiver in other cases, relying in part on the existence of Rule
502 in its rationale for compelling the disclosure.195 The court’s protective
order cited to the congressional history of Rule 502 and noted that
the rule was adopted to resolve “longstanding disputes in the courts about
the effect of certain disclosures of communications or information
protected by the attorney-client privilege” and to avoid the notion that
issues regarding the application of the privilege had to be litigated to the
hilt in order to avoid inadvertent waivers of the privilege.196
As such, the protective order specifically referenced Rule 502(d) and stated
that “the production of documents and data pursuant to this Order shall not
result in the waiver of the attorney-client privilege or work-product
protection as to those documents and data.”197 Importantly, this example
highlights the absolute protection of a Rule 502(d) order when the parties
use clear language: disclosure shall not result in waiver.
192. Id. at *34–35 (emphasis added).
193. Jicarilla Apache Nation v. United States, 93 Fed. Cl. 219, 219 (Fed. Cl. 2010)
(summarizing the document image collections that the Rule 502(d) order would protect).
194. Jicarilla Apache Nation v. United States, 91 Fed. Cl. 489, 496 (Fed. Cl. 2010).
195. Id. at 493–94.
196. Jicarilla, 93 Fed. Cl. at 219 n.1 (citing 154 CONG. REC. S1317-19 (daily ed. Feb.
27, 2008) (statement of Sen. Leahy)).
197. Id. at 220.
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171
Courts may also couple a non-waiver ruling under Rule 502(b) with an
order under Rule 502(d). This mechanism has important implications for
subsequent litigation. Even if a rendering court did not find waiver under a
Rule 502(b) analysis, there is no guarantee a subsequent court in federal or
state court would rule the same, absent the extra protection of subsection
(d). Thus, as a New Jersey District Court judge ruled in Peterson v.
Bernardi, a court may include language along with its Rule 502(b) holding
that “pursuant to FRE 502(d) any privilege or discovery protection attached
to [the relevant documents] is not waived by the inadvertent disclosure in
this court.”198
In doing so, the Peterson court appeared to exercise the type of care
one would normally expect of counsel representing large corporations
frequently involved in litigation.199 In other words, the court provided the
additional protection that counsel could have invoked at the outset of
litigation and thereby avoided the risk of waiving privilege or the costs of
litigating the waiver issue. The court found that the interests of justice
compelled the finding of non-waiver over documents that contained
detailed analysis of the previously-imprisoned plaintiff’s legal strategies.200
Even though the court felt that the documents might eventually help, rather
than hurt, the plaintiff’s case and “would not be surprised if on reflection
plaintiff decide[d] to voluntarily produce the documents,” the court entered
the Rule 502(d) order so that the plaintiff would be able to make that
informed decision independently.201 Like many situations in which Rule
502(d) orders should be used, the highest protection was utilized, and the
party could opt for the best course of action according to the circumstances
of the case.
Rule 502(d) can also be used to manage and isolate specific privilege
waivers in complicated cases. For example, in a case brought by a criminal
defendant against his former counsel, a court may properly find that
privilege has been waived as to that client in that particular matter,202 but
the privilege should not be waived in other settings.203 In Wade v. Gaither,
198. Peterson v. Bernardi, 262 F.R.D. 424, 431 (D. N.J. 2009).
199. Cf. Order Granting in Part and Denying in Part Plaintiff’s Motion to Compel,
Datel Holdings Ltd. v. Microsoft Corp., No. 09-CV-05535, 2011 WL 866993 (N.D. Cal.
Mar. 11, 2011) (providing an analysis of Rule 502(b)’s reasonable steps standard following a
disclosure by Microsoft of multiple privileged e-mail chains during discovery).
200. Peterson, 262 F.R.D. at 430.
201. Id. at 431.
202. Hearn v. Rhay, 68 F.R.D. 574, 581 (E.D. Wash. 1975) (noting that a party
impliedly waives privilege when (1) it asserts the privilege in an action it initiated; (2) the
asserting party put the protected information at issue by initiating the action; and (3)
application of the privilege would deny the opposing party access to information vital to its
defense).
203. Order Granting in Part Motion to Compel, Wade v. Gaither, No. 2:08-CV-641WFD-DN, 2010 U.S. Dist. LEXIS 14456 (D. Utah Feb. 20, 2010); see also Memorandum
Opinion and Order, PIC Group, Inc. v. LandCoast Insulation, Inc., No. 1:09-CV-662-KS-
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the court dealt with the difficult issue of a criminal defendant putting his
privileged communications with his former attorney at issue in a subsequent
civil action against the attorney, who previously represented the defendant’s
wife along with the defendant.204 The court utilized Rule 502(d) so as to
minimize any possibility that privileged communications concerning both
defendants would not be waived as to the non-litigating party.205
These orders show that courts are cognizant of the great value in Rule
502(d).206 They have invoked its protections in cases that evidently called
for the rule’s use, but the litigants had not utilized the beneficial tool.
Further, these cases highlight the fact that protective orders should
specifically invoke Rule 502(d) because later courts may need to see
specific reference to Rule 502(d) or similar language in order to construe
the protective order as determinative on the disclosure at hand.207
B. Parties’ Use of Rule 502(d)
Rule 502(d) provides attorneys and clients with a tremendous tool to
aid in reducing the litigation costs while also increasing certainty regarding
the attorney-client privilege and work-product protections. But parties do
not seem to be using this protection as much as one might expect.208
Because Rule 502(d) requires the entry of a court order, its use is reflected
in the dockets of federal courts. In order to better examine how and whether
parties have utilized Rule 502(d) since its enactment in late 2008, I
reviewed the dockets for the Northern District of Illinois. I looked for any
order entered on a motion to compel, motion for protective order, or any
other motion possibly related to attorney-client privilege. Surprisingly, I
found that very few parties have used the rule; moreover, I found that even
when parties are using protective orders with clawback agreements, they do
not explicitly invoke Rule 502(d).
Specifically, I reviewed the docket for each judge in the Northern
District of Illinois for all ongoing litigation commenced or reopened in the
months of January and February of 2009 and 2010. Those time periods
were selected because they occurred several months after the Rule’s
enactment in September 2008, which allowed time for attorneys to learn of
MTP, 2011 WL 266914 (S.D. Miss. July 7, 2011) (ordering defendant to disclose entire
image of laptop as consequence of privilege-waiver sanction, but entering Rule 502(d) order
to limit the adverse effect of such an order and preserving defendant’s right to object to
disclosure and assert privilege in any other proceeding).
204. Order Granting in Part Motion to Compel, supra note 203, at *3.
205. Id. at *7–8.
206. See cases cited supra Part V.A.
207. See FED. R. EVID. 502(e).
208. See generally Grimm, Bergstrom & Kraeuter, supra note 15 (discussing various
factors contributing to the early lack of practical impact that Rule 502 has had on litigation
practice).
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173
the new rule within the period that there was likely the most commentary
about the rule in various legal circles. I then examined the dockets of cases
filed in the same months for 2010 in order to compare usage a full year
later. This allowed sufficient time—between the filing of the action and my
review of the docket—for a given action to reach the discovery phase.
Further, by examining all of the judges’ dockets, I could account for
differing preferences among the judges, if any. In total, I reviewed the
complete dockets of 525 cases that remained active, were referred to
magistrate judges for discovery, and were filed in those four months.
I focused on cases that were referred to magistrates because it was a
useful filter to find matters that were likely to have substantial discovery
and have discovery issues brought before the court. Nonetheless, I also
looked for any protective orders that may have been entered in cases that
were not referred to a magistrate. With that said, I excluded from my
review federal habeas corpus petitions and E.R.I.S.A. actions because they
are unlikely to have many privilege issues or large document productions.
As hypothesized, I found that very few parties invoked Rule 502, let
alone Rule 502(d). While many protective orders included clawback
agreement language, it was not clear whether the parties intended to be
protected under Rule 502(d). Most surprising was the extensive use of
protective orders addressing attorney-client privilege that did not
specifically invoke Rule 502(d). The privilege provision indicates that the
parties were interested in additional certainty and possible cost-savings, yet
they failed to invoke a Federal Rule of Evidence that directly affects those
interests.
I first examined the dockets of cases filed in January or February of
2009. At the time these cases were filed, Rule 502 had only been in effect
for two or three months.209 However, by the time the parties began
exchanging substantive discovery, they would have had roughly six months
of notice of the new tool. Of the 148 cases reviewed, only three cases cited
Rule 502, but none of them specifically mentioned Rule 502(d).210
Meanwhile, seven other cases specifically contemplated privilege waiver or
a clawback agreement in their protective order without referencing Rule
502. This raises two issues: 1) what language is required to be included in a
protective order to benefit from the Rule; and 2) if an order specifically
209. See Act to Address the Waiver of the Attorney-Client Privilege and the Work
Product Doctrine, Pub. L. No. 110-322, 122 Stat. 3537 (2008) [hereinafter Act to Address
Privilege Waiver] (enacting Rule 502 into law on September 19, 2008).
210. See Stipulated Protective Order, Kenall Mfg. Co. v. H.E. Williams, No. 09-CV1284 (N.D. Ill. June 8, 2010), ECF No. 49; Order on Motion for Protective Order, Grede v.
Rodriguez, No. 09-CV-00193 (N.D. Ill. Dec. 9, 2009), ECF No. 128; Order on Motion for
Protective Order, Magallanes v. Ill. Bell Tel. Co., No. 05-CV-4626 (N.D. Ill. July 9, 2009),
ECF No. 128; Defendant’s Memorandum in Support of Its Motion for a Protective Order,
Magallanes v. Ill. Bell Tel. Co., No. 05-CV-4626 (N.D. Ill. July 7, 2009), ECF No. 126.
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cites Rule 502, but not 502(d), does it indicate a clear intent to bind future
litigation or non-parties?
To make the discussion more concrete, a couple of representative
examples will be useful. In Grede v. Rodriguez, the court entered the
parties’ stipulated Confidentiality Order that contained the following
provision on waiver:
“The provisions of Federal Rule of Evidence 502 shall apply to and
govern the effect of disclosure of communications or information covered
by the attorney-client privilege or work-product doctrine.”211 This provision
raises a number of issues and problems. A broad interpretation of the
order’s “No Waiver” term, as well as the applicability of Rule 502(d), may
lead one to conclude that this order falls under Rule 502(d) and that no
unintentional disclosure of privileged materials will result in waiver. As a
result, this order would also bind non-parties in federal or state court.
Certainly, these conclusions could flow from the language “provisions of
Federal Rule of Evidence 502.” On the other hand, Rule 502(b)’s
inadvertence standard is also such a provision. But it would be superfluous
for these parties to incorporate in their confidentiality order a rule that
would automatically apply without the order.
There is some indication, however, that the parties did not have the full
protections of Rule 502(d) in mind. Another provision of the
Confidentiality Order provides that “[u]pon entry of a protective order
adopting the terms of this Agreement, the terms of this Agreement shall be
binding on all Parties . . . and any other individual or entity who receives
this order.”212 The first clause of the provision limits the binding effect of
the Confidentiality Order to the parties, which is contrary to one of the
fundamental characteristics of a Rule 502(d) order: its binding effect on
non-parties. The second clause of the “Binding Effect” provision extends
the Confidentiality Order to those that receive the order. In all likelihood,
this would include individuals receiving disclosures, such as experts. A
third party separately litigating against one of these parties would have no
occasion to receive the order. Accordingly, it would not seem to extend to
separate litigation; thus, it is not clear that these parties would actually
benefit from the protections of Rule 502(d). In sum, the Confidentiality
Order’s two provisions are vague at best and contradictory at worst.
Parties are also entering protective orders that invoke the concepts of
Rule 502 without citing to the rule. For example, parties might include a
clawback provision such as this one used in ARTRA 524(g) Asbestos Trust
v. Fairmont Premier Insurance Co.:
If a Party or non-party discovers that it inadvertently produced
information or documents that it considered to be privileged or otherwise
211. Stipulated Confidentiality Order at 13, Grede v. Rodriguez, No. 09-CV-00193
(N.D. Ill. Dec 10, 2009), ECF No. 132.
212. Id. at 10.
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protected from production in whole or in part (“Privileged Material”), the
producing Party may retrieve such Privileged Material or parts thereof as
follows:
...
5. The inadvertent production of a document subject to a
privilege or protection shall not operate as a waiver of the
applicable privilege or protection.213
The ARTRA order also provided the following provision with regards to
its binding effect: “This Order shall survive the termination of this action
and expiration of all rights of appeal and shall continue in full force and
effect thereafter.”214 The parties seem to clearly indicate in this order that
they do not want the de facto standard of Rule 502(b) reasonableness to
apply. But they do not specifically invoke Rule 502(d) in their order. As a
result, it is again not clear that this order should have effect beyond these
parties, even with the language that it shall remain in effect beyond the
termination of the litigation.
Curiously, in the set of cases from 2010, parties continued to lack
clarity in many of the orders. There were many more cases that remained
active on the docket in the 2010 set, and I reviewed 377 dockets, excluding
the same E.R.I.S.A. and Prisoner Civil Rights actions. Within that set of
actions, the court entered a protective order in 83 cases, which I reviewed.
From the cases filed in 2010, there was no substantial increase in the
percentage of cases with specific citation to Rule 502. Only seven
protective orders mentioned Rule 502 in some form. While the gross
number of citations to Rule 502 was more than double (recall that there
were three such orders in the 2009 set), the total number of active cases
from the 2010 set was also more than double the number of 2009 cases that
remained active—377 and 148, respectively. Like the examples from the
2009 cases previously discussed, many of the protective orders could
arguably fall under Rule 502(d)’s protections—twelve protective orders
contained an unqualified clawback agreement. Unlike the 2009 cases,
however, two matters specifically cited to Rule 502(d) and explicitly stated
that the order represented a party agreement as required by Rule 502(e).215
213. Stipulated Protective Order Regarding Confidentiality at 10, ARTRA 524(g)
Asbestos Trust v. Fairmont Premier Ins. Co., No. 09-CV-458 (N.D. Ill. Jan 25, 2010), ECF
No. 45.
214. See Defendants’ Reply Memorandum in Support of Their Motion to Dismiss
Plaintiff’s Complaint at 10, Demarco v. Nw. Mem’l Healthcare, No. 10-CV-397 (N.D. Ill.
Jan. 21, 2011), ECF No. 20; Defendants’ Initial Status Report at 4, Bergman v. Kindred
Healthcare, Inc., No. 10-CV-191 (N.D. Ill. Nov. 18, 2010), ECF No. 24.
215. Stipulation and Protective Order Governing the Production and Exchange of
Confidential Information at 13, Demarco v. Nw. Mem’l Healthcare, No. 10-CV-397 (N.D.
Ill. Jan. 21, 2011), ECF No. 41; Stipulation and Protective Order Governing the Production
and Exchange of Confidential Information at 14–15, Bergman v. Kindred Healthcare, Inc.,
No. 10-CV-191 (N.D. Ill. Nov. 18, 2010), ECF No. 73.
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Conclusions of increased usage inferred from the two separate Rule 502(d)
orders should be tempered, though, by the fact that both orders involved the
same law firm, Seyfarth Shaw L.L.P., and perhaps even the same practice
group.216
Despite the additional time litigants had to become familiar with Rule
502(d), many of the same uncertainties that were prevalent in protective
orders from the 2009 cases still remained. For example, eighteen cases
indicated a direct interest for the protective order to survive beyond the
termination of the underlying litigation;217 however, only two orders, other
than the two invoking Rule 502(d) directly, coupled a survivability
provision with a mention of Rule 502.218 A survivability provision indicates
an intent for the given protective order to have effect beyond the confines
of the underlying litigation.219 Such intent, coupled with a citation to Rule
502 or some other non-waiver provision, could create the basis for an
argument that a subsequent court should apply Rule 502(d) to the order.
Without a direct citation to Rule 502(d) or an affirmative invocation of the
order’s power to bind non-parties, a subsequent court would again be asked
to give more effect to the order than is plainly evident from its language.220
Even sophisticated parties with sophisticated representation in a class
action, where certainty on privilege waiver would be important, did not
necessarily make the intentions of the controlling effect of a particular order
clear.221 In Greene v. DirecTV, the parties stipulated to the court’s entry of a
protective order near the beginning of a class action asserted against
DirecTV. The order addressed privilege as follows:
With respect to Information produced by a party as to which the party
inadvertently failed at the time of production to assert a claim of attorneyclient privilege or work product immunity, such production shall not be a
waiver of that privilege or immunity claim. . . . Nothing in this provision
216. See Defendants’ Reply Memorandum in Support of Their Motion to Dismiss
Plaintiff’s Complaint, supra note 214, at 10; Defendants’ Initial Status Report, supra note
214, at 4.
217. See, e.g., Protective Order at 7, Custom Underground, Inc. v. Ford Motor Co., No.
10-CV-127 (N.D. Ill. July 12, 2010), ECF No. 43 (stating that “the Protective Order shall
continue to be binding after the conclusion of this case” along with an inadvertent
disclosure, non-waiver provision).
218. See Stipulated Protective Order at 4, Green v. DirecTV, Inc., No. 1:10-CV-117
(N.D. Ill. May 28, 2010), ECF No. 51 (citing rule 502 of the Federal Rules of Civil
Procedure).
219. See Protective Order, supra note 217, at 8 (stating that the protective order “shall
survive any final judgment or settlement in this action.”).
220. See id.
221. See, e.g., Stipulated Protective Order, supra note 218.
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
177
is designed to limit the parties’ rights regarding inadvertent disclosure of
privileged materials under Federal Rule of Civil Procedure 502.222
At first glance, the provision is quite clear: production shall not result in
waiver so long as the producing party inadvertently produced the
document.223 On the other hand, the latter clause, that “[n]othing in this
provision is designed to limit the parties’ rights . . . under [Rule 502],”
could be interpreted to invoke Rule 502(b) rather than Rule 502(d).224
Subsection (b) is the default provision of Rule 502, so a party’s “rights”
would be those under (b), while subsection (d) requires an affirmative
invocation through a court order. Further, the “not designed to limit”
language of the protective order may arguably call for the rule’s default
protection rather than an affirmative invocation of the additional protections
of subsection (d).
In practice, DirecTV would, in order to attain the protections of Rule
502(d), have to argue to a subsequent judge that she should go beyond the
plain language of the first judge’s order and hold that the order shall be
binding on non-parties, an effect which the order, standing alone, does not
explicitly contemplate.225 However, the language of Rule 502(d) provides a
fairly strong argument for doing so. It provides that a court “may order that
the privilege is not waived by disclosure connected with the litigation
pending before the court—in which event the disclosure is also not a waiver
in any other Federal or State proceeding.”226 The DirecTV protective order
seemingly falls under the first clause of the rule.227 The second clause then
dictates the effect of such an order. Arguably, specific citation to Rule
502(d) may not be necessary. However, a subsequent court may be hesitant
to apply such an order beyond the scope that the order explicitly articulates.
Another interesting pattern that emerged from my review of the docket
of the Northern District of Illinois is that large corporate litigants, who
likely have multiple litigation matters annually and are likely represented
by especially sophisticated attorneys, were much more likely to have
protective orders in their cases that covered privilege waiver. They were
not, however, substantially more likely to enter orders under Rule 502(d).
Companies like DirecTV, FedEx, OshKosh, Ford, and Michael Jordan all
regularly use protective orders—many of which include clawback
agreements—that do not explicitly indicate their intention to invoke Rule
222. Id. at 5.
223. But see Heriot v. Byrne, 257 F.R.D. 645, 659 (N.D. Ill. Mar. 20, 2009) (utilizing
an objective approach to analyzing inadvertence and incorporating factors typically used in
the reasonableness analysis).
224. See Stipulated Protective Order, supra note 218, at 5.
225. See id.
226. FED. R. EVID. 502(d).
227. See Stipulated Protective Order, supra note 218.
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502(d) and expand the effect of the order to other lawsuits and nonparties.228
Certainly, even without Rule 502(d), parties may request the court to
enter orders controlling their discovery of privileged material; the Hopson
case specifically mentions this possibility.229 But Rule 502(d) is not
intended to automatically bring all such orders under its purview.
Therefore, while parties certainly have an argument that their protective
order enjoys all of the benefits of the new rule, it is not a certainty.
VI. WHY ARE PARTIES NOT USING RULE 502(D)?
A party invoking Rule 502(d) loses nothing but has much to gain. Rule
502(d) has only been in effect for little more than two years. Not all parties
may know about its protections, but some change in how often Rule 502(d)
provisions are included in protective orders should become noticeable; and
yet, that does not appear to be happening.230 If one disregards my
contention that there is no negative risk to invoking Rule 502(d) and looks
to its weaknesses, one can formulate a few plausible arguments to question
the import of using Rule 502(d). One of the more interesting contentions is
that Rule 502 may stand on shaky constitutional foundations.231 The other
primary criticism is that Rule 502(d) is pragmatically ineffective because
even without a waiver, once a privileged document is disclosed, one cannot
“unring the bell.” The party who received and saw the document has
learned that information forever. In this Part, I argue that the former
constitutional criticism misapprehends Congress’s actions when it enacted
Rule 502 and that the rule is quite safely within the constitutional
boundaries of the federal government’s power. This Part will also explain
why the constitutional criticism undermines the multi-dimensional benefits
of Rule 502(d) and ignores the flexibility and certainty that the rule
provides.
228. See, e.g., Protective Order, Control Solutions LLC v. OshKosh Corp., No. 1:10CV-00121 (N.D. Ill. Sept. 30, 2010), ECF No. 57; Protective Order, supra note 217; Agreed
Protective Order, Michael Jordan & Jump 23, Inc. v. Dominick’s Finer Foods, LLC, No. 10CV-00407 (N.D. Ill. Apr. 5, 2010), ECF No. 30; Agreed Protective Order, Jones v. FedEx
Nat’l LTL, Inc., No. 09-C-0397 (N.D. Ill. June 4, 2009), ECF No. 15.
229. Hopson v. City of Baltimore, 232 F.R.D. 228, 232 n.1 (D. Md. 2005).
230. See discussion supra Part V.
231. See Henry S. Noyes, Federal Rule of Evidence 502: Stirring the State Law of
Privilege and Professional Responsibility with a Federal Stick, 66 WASH. & LEE L. REV.
673, 678 (2009) (arguing that Rule 502 exceeds Congress’s Commerce Clause power,
violates the Due Process Clause in certain situations, and raises serious questions about a
federal court’s power to enter orders binding in state courts).
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
179
A. Rule 502(d) Delineates the Controlling Effect of a Federal Court Order
Some litigants fear that Rule 502(d) is either unconstitutional or that
state courts are not obligated to follow its directive.232 These are really two
angles of the same argument. States would not be obligated to follow Rule
502(d)’s directive if the rule exceeds Congress’s or a federal court’s
constitutional power. At issue in the constitutional criticism of Rule 502(d)
is the language “the disclosure is also not a waiver in any other Federal or
State proceeding.” Critically, Rule 502(d) makes clear that its protections
are only invoked when included in a court’s order.233 The argument
essentially proceeds that this provision regulates a state court’s ability to
control its proceedings and does not, therefore, regulate economic activity.
Hence, Rule 502(d) strays beyond Congress’s power under the Commerce
Clause.234 However, the controlling effect of a federal court’s order is
clearly and safely a matter of federal common law.235 With Rule 502(d),
Congress took it upon itself to articulate the controlling effect of a
particular type of order.236 Accordingly, state courts are obligated to follow
and enforce such orders as a matter of federal supremacy.
State courts must give effect to federal judgments as prescribed by the
Supreme Court.237 Rule 502(d)’s language merely prescribes the effect that
an order on privilege waiver will have in federal and state courts; the
court’s order, then, is effectively a determination on the issue of waiver,
which precludes re-litigation of that issue. However, Rule 502(d) did not go
through the typical rulemaking process by way of the Supreme Court;
rather, it was enacted by Congress.238 Since Congress can delegate authority
to courts to fashion common law in certain circumstances within its
authority,239 a fortiori Congress can prescribe the controlling effect of the
federal district court’s judgment, thereby guiding federal common law.240
232. See, e.g., Protective Order and Order Denying Stay at *2, Whitaker, Chalk,
Swindle & Sawyer, LLP v. Dart Oil & Gas Corp., No. 4:08-CV-684-Y, 2009 U.S. Dist.
LEXIS 15901 (N.D. Tex. Feb. 23, 2009). Also, in a survey sent to multiple large law firms,
some attorneys expressed concern in relying upon the rule due to a lack of confidence in a
Rule 502(d) order’s enforceability in state court.
233. FED. R. EVID. 502(d) advisory committee’s note.
234. U.S. CONST. art. I, § 8, cl. 3.
235. See Semtek Int’l, Inc. v. Lockheed Martin Corp., 531 U.S. 497, 507–08 (2001)
(holding that federal common law governs the claim-preclusive effect of a dismissal by a
federal court sitting in diversity after noting the Court’s long-held power to prescribe the
preclusive effect of federal question cases).
236. See Act to Address Privilege Waiver, supra note 209.
237. See Semtek, 531 U.S. at 507 (noting that the Supreme Court has the “last word” on
the preclusive effect of all federal judgments).
238. See Act to Address Privilege Waiver, supra note 209.
239. See, e.g., Textile Workers Union of Am. v. Lincoln Mills of Ala., 353 U.S. 448,
451 (1957) (holding that Congress delegated to the Court to fashion federal common law
covering Section 301 of the National Labor Relations Act); see also Leegin Creative Leather
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This rule applies to orders such as those entered under Rule 502(d) as
well. If the order is determinative and binding in a district court, a state
court is obligated to follow.241
On the other hand, the binding effect of Rule 502(d) could ultimately
flow from the federal judiciary’s power as guided by Congress’s expression
of federal interests. Congress may not have the ultimate power to determine
the effect of a federal court’s judgment in terms of the respect that other
courts must afford it.242 Yet, the Supreme Court stated in Semtek that the
federal common law takes a cue from federal public policy.243 Here,
Congress’s creation of a device that permits litigants to request an order
protecting attorney-client privilege over documents disclosed in the federal
proceeding can then be seen as an expression of federal interests because it
makes such an order preclusive on all future state and federal courts.244 The
courts, looking to those federal interests as directed by Supreme Court
precedent, would fashion federal common law to define the preclusive
effect of the Rule 502(d) order so that it bound future state and federal
courts as well.
The argument against the constitutionality of Rule 502 has been
primarily focused on the limitations on Congress’s Commerce Clause
power, because the provision is cited by those anticipating the enactment of
the rule.245 Henry Noyes argues that Congress cannot enact a rule that
regulates the states’ “ability to determine what evidence is discoverable and
Products, Inc. v. PSKS, Inc., 551 U.S. 877, 899 (2007) (noting that the Supreme Court has
treated the Sherman Act as a common-law statute).
240. Cf. Muskrat v. United States, 219 U.S. 346, 347 (1911) (holding that the Court is
obligated to hold any delegation beyond Congress’s power unconstitutional).
241. See Estate of Hilton, 199 Cal. App. 3d 1145, 1168 (Cal. Ct. App. 1988) (noting
that “[a] federal judgment ‘has the same effect in the [state courts] as it would have in a
federal court[]’” and that “[t]he federal rule is that ‘a judgment or order, once rendered, is
final for purposes of res judicata until reversed on appeal or set aside in the court of
rendition.’”).
242. See Semtek, 531 U.S. at 507–08 (emphasizing the Supreme Court’s ultimate
authority to prescribe the effect of a federal court judgment and pointing out that the Full
Faith and Credit Clause applies to state judgments); see also Larry Kramer, Same-Sex
Marriage, Conflict of Laws, and the Unconstitutional Public Policy Exception, 106 YALE
L.J. 1965, 2003 (1997) (arguing, in the context of Congress’s power to determine the effects
of state judicial proceedings, that Congress is merely empowered to refine and implement
the faith and credit requirements as defined by the Supreme Court).
243. Semtek, 531 U.S. at 509 (“This federal reference to state law will not obtain, of
course, in situations in which the state law is incompatible with federal interests.”).
244. See FED. R. EVID. 502(d) advisory committee’s note.
245. See Memorandum from the Advisory Comm. on Evidence Rules to the Standing
Comm. on Rules of Practice and Procedure 14 (May 15, 2006), available at
http://www.uscourts.gov/uscourts/RulesAndPolicies/rules/Excerpt_EV_Report_Pub.pdf
[hereinafter Memorandum]; see also Noyes, supra note 231, at 700 (arguing that Rule
502(d) exceeds Congress’s Commerce Clause power).
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
181
what evidence is admissible.”246 He notes that Congress may only regulate
intrastate activity that is “economic in nature”247 and that Rule 502(d)
instead regulates the state courts’ ability to govern their own proceedings.248
Noyes distinguishes cases like Pierce County v. Guillen, in which the Court
held that Congress acted within its Commerce Clause authority when it
enacted a statute prohibiting the discoverability of certain highway safety
reports, on the grounds that, in Pierce, Congress acted properly within its
power to regulate the “channels of interstate commerce.”249 Noyes correctly
points out that when it enacted Rule 502, Congress made no specific
findings regarding the effects of waiver privilege on interstate commerce.250
He uses this fact to argue that Congress also lacked the power to enact the
rule under its power to regulate conduct that substantially affects interstate
activity.251
Noyes also argues that Rule 502(d) poses Due Process concerns
because it binds non-parties who will not have had an opportunity to
challenge the non-waiver order.252 Noyes argues this restriction would
“violate the Fourteenth Amendment’s Due Process Clause unless the state
court litigant received appropriate notice and opportunity to be heard.”253
However, Noyes’s argument misconstrues the nature of a Rule 502(d)
order, which actually prevents information from being discoverable in the
first place. Therefore, rather than take a right away, a Rule 502(d) order
simply protects a party’s right to have its communications protected by the
attorney-client privilege or work product doctrine. Accordingly, a third
party would not have grounds to argue under the Fourteenth Amendment
that its right was stripped.
Commentary on the constitutionality of Congress enacting a nationwide
privilege rule is not one sided, however. Professor Dan Capra, one of the
architects of Rule 502 on the Evidence Committee, anticipated these
objections and addressed them when originally proposing Rule 502.254 First,
he noted that even in the absence of a congressionally enacted rule, federal
courts likely have the power to limit the use of information obtained in
246. Noyes, supra note 231, at 700.
247. United States v. Morrison, 529 U.S. 598, 613 (2000).
248. Noyes, supra note 231, at 678.
249. Id. at 703–05.
250. Id. at 708.
251. Id.
252. Id. at 739–41.
253. Id. at 741.
254. Kenneth S. Broun and Daniel J. Capra, Getting Control of Waiver of Privilege in
the Federal Courts: A Proposal for a Federal Rule of Evidence 502, 58 S.C. L. REV. 211,
240 (2006). Professor Capra is the Reporter to the Judicial Conference Advisory Committee
on Evidence Rules, where Rule 502 was proposed. Id. at 211.
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discovery.255 After all, protective orders were commonplace prior to the
enactment of Rule 502, and they were generally upheld.256
Furthermore, some have argued that Congress should go further than a
rule on privilege waiver and enact a federal privilege law. Professor
Timothy Glynn argues that Congress should resolve many of the problems
associated with attorney-client privilege and litigation costs by enacting
federal legislation providing clear, national protections for attorney-client
communications.257 Interestingly, writing in 2002, Glynn argued that
uncertainty and unpredictability in attorney-client privilege waiver
necessitated a nationalized privilege.258 If Congress has the power to enact
substantive privilege law, then it certainly has the lesser power to delineate
the circumstances in which privilege has been waived.259
This power flows from Congress’s broader power to legislate on
matters concerning the operation of federal courts. Both Article III, Section
One, in which Congress is given power to establish lower federal courts,
and Article I, Section Eight, the Necessary and Proper Clause, give
Congress the power to regulate proceedings of federal courts.260 The power
then to have such regulation binding upon state actions proceeds from
federal supremacy.261 As noted above, cases like Semtek establish that
federal law or federal rules can control state decisions with regards to
litigation that implicates federal legislation or a federal court’s order.262
Congress attempted to address the concerns noted by Professor Noyes.
The advisory committee’s notes make clear that none of the rule’s
provisions address or modify substantive attorney-client privilege, which is
still controlled by state law, or whether the privilege has been waived in any
context other than disclosure during the course of litigation before a federal
court.263 In fact, the rule’s early revision process clearly suggests that the
drafters were cognizant of not venturing into control of substantive state
privilege law.264 A state court has full power to declare that a document is
not privileged ab initio according to substantive state privilege law
255. Id. at 240–41.
256. See id. at 241; see also E.I. Du Pont De Nemours Powder Co. v. Masland, 244
U.S. 100, 103 (1917) (upholding order protecting trade secrets from disclosure); Chem. &
Indus. Corp. v. Druffel, 301 F.2d 126, 130 (6th Cir. 1962) (upholding protective order
involving trade secrets); 8A CHARLES ALAN WRIGHT, ARTHUR R. MILLER & RICHARD L.
MARCUS, FEDERAL PRACTICE AND PROCEDURE § 2043 (2010) (discussing numerous cases in
which protective orders were issued under Rule 26 of the Federal Rules of Civil Procedure).
257. Timothy P. Glynn, Federalizing Privilege, 52 AM. U. L. REV. 59, 133 (2002).
258. Id. at 129–30, 133.
259. Id. at 133–34.
260. Broun & Capra, supra note 254, at 242–43.
261. Id.
262. See, e.g., Brown v. W. Ry. of Ala., 338 U.S. 294, 296 (1949) (finding that the
federal pleading test should have been applied in a FELA action filed in state court).
263. FED. R. EVID. 502(d) advisory committee’s note.
264. See Broun & Capra, supra note 254, at 247–48.
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THE (UNAPPRECIATED) BENEFITS OF RULE 502(d)
183
regardless of Rule 502; it simply cannot rule that a disclosure in the federal
proceeding in which the privileged document was subject to a Rule 502(d)
order causes privilege to be waived.265 Thus, the rule’s encroachment on
state law is very limited. “The new rule satisf[ied] the last remaining
concern of [the Conference of State Supreme Court Chief Justices].”266
Rule 502(d) merely provides a mechanism for entry of an order on waiver
and delineates the controlling effect of that order, which states are obligated
to follow.267 The scope of the rule is actually quite modest.268 Its nonwaiver directive is limited to the consequences of disclosures in federal
court and only touches state courts in its delineation of the controlling effect
of the federal court’s order—a power squarely within the ambit of the
federal government.269 State courts are obligated to adhere to such rules,
whether they are prescribed by Congress or the federal courts.270
B. Rule 502(d) Cannot Unring the Bell, but It Can Limit Who Hears It
A majority of respondents to a survey sent to several small and large
law firms, as well as the Federal Bar Association of Chicago, expressed that
their reluctance to use Rule 502(d) was primarily caused by the fact that an
opposing party cannot unlearn information once it is disclosed regardless of
the admissibility of the document.271 Only three attorneys had been
involved in multiple litigation matters in which a party utilized a Rule
502(d) order, and three others had been involved in just one matter.
Meanwhile, twenty-three attorneys had never been involved in a case where
such an order was entered. As a result, their apprehension over an opposing
party learning damaging information arguably impacts one’s decision
265. 154 CONG. REC. S1317-18 (daily ed. Feb. 27, 2008) (statement of Sen. Leahy).
266. Id.
267. Id.
268. Compare Memorandum, supra note 245, at 6 (suggesting a proposed amendment
to Federal Rule of Evidence 502 to provide that “[a] disclosure . . . does not operate as a
waiver in a state or federal proceeding if the disclosure is inadvertent and is made in
connection with federal litigation or federal administrative proceedings—and if the holder of
the privilege or work product protection took reasonable precautions to prevent
disclosure . . . .”), with FED. R. EVID. 502(b) (limiting the application to disclosures in
federal court and only affecting the preclusive effect of non-waiver through a court order
under subdivision (d)).
269. See Broun & Capra, supra note 254, at 242–43.
270. Id.
271. I conducted a short, online survey and distributed it to a broad swath of attorneys
around the country [hereinafter Survey]. While only twenty-nine attorneys submitted
complete responses, the data are nonetheless instructive. The survey asked attorneys about
their experience, or lack thereof, with Rule 502(d), clawback agreements, and privilege
review. It also asked about the effects on litigation costs that a clawback agreement or Rule
502(d) order has had. The data cited are not intended to be representative but merely
anecdotal.
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whether to use the rule. Commentators have voiced similar criticisms of
Rule 502(d).272 This criticism ignores the multidimensional benefits of Rule
502(d) and assumes that Rule 502(d) has some causal relationship to the
damaging disclosure. Further, the criticism ignores the flexible
customization of privilege review that Rule 502(d) enables.273
While it is true that a party may learn damaging information through a
privileged document’s disclosure, the use of a Rule 502(d) order makes this
no more or less likely. Nothing in either Rule 502(d) itself or a protective
order needs to inherently reduce the level of care taken in reviewing
documents. Litigators can, and should, still undertake a thorough privilege
review of documents that are likely to contain substantive privileged
communications between an attorney and client. In fact, state ethical
obligations require as much.274 Rule 502(d) merely allows a party to
customize and tailor a privilege review strategy according to the demands
of a given case.275 If requested documents are unlikely to contain any
privileged communications, then a party can skip review, save a substantial
amount of money, and disclose those documents knowing that a nonsubstantive, privileged e-mail included therein cannot be the subject of a
lengthy inquiry at a later deposition.276 In essence, Rule 502(d) orders allow
a party to make an individual cost-benefit analysis of the privilege review it
will undertake for each case based upon the circumstances of the
litigation.277 The rule itself mandates no more or less care when making
discovery exchanges than the party chooses.
Relaxing privilege review under the protective assurances provided by
Rule 502(d) can substantially reduce litigation costs for parties that
frequently litigate multiple matters in state and federal jurisdictions.278 A
large corporation may be involved in multiple parallel suits, any one of
272. See Noyes, supra note 231, at 753 (arguing that an “adversary may formulate
questions or trial strategies . . . based on or informed by” the information contained in
privileged documents even when they are protected by a Rule 502(d) order); Wang, supra
note 119, at 1839–40 (arguing that courts should not enforce “irrespective-of-care nonwaiver
agreements” in part because once an opposing side has seen information it “could trigger a
chain of events that might ultimately even cost the client a victory.”).
273. See 154 CONG. REC. H7819 (daily ed. Sept. 8, 2008) (statement of Rep. JacksonLee) (explaining the congressional intent regarding Rule 502 of the Federal Rules of
Evidence).
274. Paula Schaefer, The Future of Inadvertent Disclosure: The Lingering Need to
Revise Professional Conduct Rules, 69 MD. L. REV. 195, 196, 241–42 (2010) (discussing
state ethical obligations and proposing revisions to the rules of professional conduct in order
to provide increased guidance to practitioners faced with the possibility of inadvertent
disclosures during discovery).
275. See 154 CONG. REC. H7819.
276. Id.
277. Id.
278. See Memorandum, supra note 245, at 4–5 (discussing Rule 502 as a proposed
legislative response to the increasingly cost-prohibitive expense of discovery).
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185
which does not expose it to exorbitant liabilities; yet, with the rapidly
increasing volume of discoverable information, privilege review costs for
each individual case may outweigh the potential liability.279 The existence
of multiple on-going lawsuits may require the corporation to undergo
extensive privilege review in each case for fear that a disclosure in one will
result in a waiver in another jurisdiction.280 Rule 502(d) cabins the
disclosure to the litigation before the court and ensures that the document
will not be admitted in that litigation or any other.281 Therefore, the
corporation can analyze the necessary privilege review on a case-specific,
cost-benefit basis with the added assurance that inadvertent disclosures will
not waive privilege in other cases.282
Rule 502(d) serves to minimize the damage if an inadvertent disclosure
of privileged information occurs, and in many respects, it provides added
protection to protective orders.283 Six survey respondents (the same number
that had been involved in litigation with a Rule 502(d) order) said that they
use protective orders in more than half of their cases.284 However, the same
“bell ringing” criticism leveled against Rule 502(d) would run against
protective orders. It may be damaging for an opposing party to learn such
information, which, absent the mistaken disclosure, it would not have
learned.285 On the other hand, it would be more damaging if a judge orders
that the document is now admissible at trial due to the ineffective privilege
review undertaken in a document-intensive case. A protective order under
Rule 502(d) would protect against that waiver, while the non-Rule 502(d)
orders that the respondents regularly used would not.286
In addition, an opposing party may gain leverage in settlement
negotiations upon learning information through a privileged document, but
that leverage is substantially increased if the opposing party possesses the
additional threat of putting the particular document before a jury or in front
of a witness.287 Rule 502(d) eliminates the possibility of this happening.288
Rule 502(d), while enabling parties to do so, does not mandate a
reduced privilege review. Further, mistakes are made even when parties
279. Id. (citing to specific cases demonstrating burdensome and often cost-prohibitive
discovery expense).
280. See supra note 3 and accompanying text.
281. See Broun & Capra, supra note 254, at 261.
282. Id. at 261, 265.
283. See 154 Cong. Rec. H7819 (daily ed. Sept. 8, 2008) (statement of Rep. JacksonLee).
284. See Survey, supra note 271.
285. See supra note 272 and accompanying text.
286. See Broun & Capra, supra note 254, at 215 (discussing the inability of pre-Rule
502(d) protective orders to “bind persons or entities not party to” the proceeding and,
consequently, leaving uncertainties regarding the status of privilege waiver in future
litigation).
287. See Memorandum, supra note 245, at 10–11.
288. See id.
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believe they are thoroughly reviewing documents for privilege.289 Rule
502(d) provides added assurance that the damage from such a mistake is
mitigated as much as possible.290 Therefore, it is no response to the
potential benefits of Rule 502(d) that an opposing party cannot unlearn the
information once it is disclosed. There is simply no relationship between
that fear and the rule itself. Moreover, the critique ignores the benefits for a
party from use of the rule whether or not such a disclosure is made.291
C. Other Considerations
There are additional issues that one must consider when choosing to
utilize Rule 502(d). Undoubtedly, Rule 502(d) does not benefit everyone.292
Individual litigants that do not possess much discovery, let alone privileged
communications, may see little value in utilizing the rule.293 In fact, they
may have incentive to object to such an order.294 While not necessarily a
valid reason to object, these litigants may not want to eliminate the
possibility that privilege over some inadvertently disclosed document might
be waived. This dynamic may account for part of the reason parties are not
regularly using Rule 502(d) orders.295 In many cases, only one party has
reason to think about using the new tool.296
Rule 502(d) also requires additional discussion with one’s client, at
least before making the decision to reduce privilege review.297 An attorney
should nonetheless recommend its use. Regardless of the decision on the
privilege review procedures, the added protections of a Rule 502(d)
protective order should be explained to the client.298 In such a conversation,
289. See Schaefer, supra note 274, at 199–202 (discussing the exponential growth of
the client’s production of discoverable information during the last decade and the inevitable
issues with inadvertent disclosure resulting from the sheer quantity of privileged information
lawyers must now review).
290. See Memorandum, supra note 245, at 10–11.
291. Compare supra notes 203–04 and accompanying text (discussing the benefits of
the flexibility of Rule 502), with Wang, supra note 119, at 1846–47 (arguing that once an
adversary sees a privileged document the damage is already done, thus making the use of
protective orders too risky).
292. See New York Hearing, supra note 2, at 250 (testimony of Peter Sullivan)
(explaining that individual plaintiffs “have nothing to lose by disagreeing with a request for”
a Rule 502(d) protective order).
293. Id.
294. Id.
295. See Survey, supra note 271 (evidencing the lack of Rule 502(d)’s use in practice).
296. See New York Hearing, supra note 2, at 250 (testimony of Peter Sullivan).
297. Schaefer, supra note 274, at 247–48 (proposing additional comments to Model
Rule of Professional Conduct 1.6 in order to provide guidance to attorneys in discussing the
potential risk of inadvertent disclosure of privileged information inherent in protective
orders, such as those under Rule 502(d)).
298. See supra notes 278–79 and accompanying text.
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the attorney can discuss whether there are certain categories of documents
that the client thinks do not contain privileged information—or at least any
damaging privileged information. The Verizon example is useful.299 Many
corporate clients will have documents that potentially contain privileged
material relating to old matters not relevant to the on-going litigation.300 It
may not be worth the high costs to pay counsel to review those documents
page-by-page.301 An attorney should not unilaterally decide to curtail
privilege review, but Rule 502(d) does not mandate him to do so. An
attorney can utilize an order under the rule simply as an added protection.302
The client can then choose whether to partake in the rule’s additional
benefits.303 These are not arguments against the use of Rule 502; rather,
they are issues an attorney should consider.
Since very few courts have had the opportunity to review a challenged
Rule 502(d) order, the law is not yet clear on what is required of an order to
invoke the protections of Rule 502(d).304 If we remember the Evidence
Committee’s hearings, however, there was some indication that the rule
requires specific citation.305 Some courts are reluctant to construe protective
orders broadly enough to provide full protections when the language of the
order does not call for such an effect.306 Nonetheless, the dockets reveal that
parties are 1) not using Rule 502(d) with the regularity that one might
expect of such a valuable tool; and 2) if they are desirous of its protections,
they are not so clearly invoking them.307 These two phenomena could have
a number of causes, not the least of which could be the rule’s relative
infancy and a general lack of litigants’ awareness.308 Many attorneys
expressed that their lack of familiarity with Rule 502 was one reason they
have not used it.309 However, the primary arguments against the
effectiveness of Rule 502(d), either claiming that the rule is not binding
because of its unconstitutionality or that it does not protect from the damage
299. New York Hearing, supra note 2, at 92–93 (testimony of Ann Kershaw).
300. See id.
301. See id. at 88–89 (testimony of Patrick Oot) (citing Verizon’s discovery review
expense in excess of $13 million).
302. See 154 CONG. REC. H7819 (daily ed. Sept. 8, 2008) (describing the benefits of
Rule 502(d)).
303. See Memorandum, supra note 245, at 6, 10–11 (explaining that Rule 502 provides
additional benefits which supplement, but do not supplant, the client’s rights under
traditional waiver doctrine).
304. Grimm, Bergstrom & Kraeuter, supra note 15, at 2 (noting the minimal use of
Rule 502 in litigation and the lack of consistency in judges’ application of Rule 502).
305. New York Hearing, supra note 2, at 78–79 (testimony of Henry Sneath).
306. See supra notes 211–13 and accompanying text.
307. See supra Part V.B (analyzing the docket of the Northern District of Illinois over a
one-year period).
308. See Grimm, Bergstrom & Kraeuter, supra note 15, at 2.
309. See Survey, supra note 271.
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of an opposing party learning the information, do not withstand close
scrutiny.
VII. CONCLUSION
Rule 502(d) provides predictable and certain protection, which is
fundamentally important to issues of privilege and discovery. It also allows
a litigant to dramatically reduce its costs of litigation by customizing
privilege review according to the demands of the matter at issue.310
Therefore, this tool not only provides a shield against waiver, it also
affirmatively reduces leverage otherwise possessed by an opposing party in
the form of known costs to litigate and respond to discovery. At the same
time, a party loses nothing by invoking Rule 502(d).311
Yet, despite all of these advantages, two clear problems have emerged
in the years since Rule 502’s enactment. First, parties are not using Rule
502(d) orders to the extent one would expect.312 Second, they are
nonetheless using protective orders as they did before the rule; so they may
be operating under the mistaken belief that these orders enjoy the
protections of Rule 502(d) when, in fact, they do not.313
The first problem is largely a result of mistaken fears. Litigants fear that
a disclosure, even without waiver, will nonetheless disadvantage them
because the opposing party will learn damaging information as a result of
reduced privilege review. Therefore, they are unwilling to use Rule 502(d)
orders because they are unwilling to forego a document-by-document
review.314 This fear is misplaced because Rule 502(d) does not require a
reduced privilege review.315 It merely provides certainty and protection,
liberating a party to engage in as much or as little privilege review as the
circumstances necessitate.316 Further, the rule reduces the risk of a mistake
by limiting it to the case at hand—a limitation that is absent without the
order.317 Litigants also fear that the state courts may not follow the rule’s
orders of non-waiver due to constitutional concerns.318 This fear
misconstrues the clear constitutional power of federal courts and Congress
310. See 154 CONG. REC. H7817 (daily ed. Sept. 8, 2008) (statement of Rep. JacksonLee).
311. Id.
312. See Grimm, Bergstrom & Kraeuter, supra note 15, at 2; Survey, supra note 271.
313. See supra notes 211–13 and accompanying text (discussing the lack of specific
invocation of Rule 502(d)).
314. Withers, supra note 26, at 185.
315. See Cong. Rec. S1318 (daily ed. Feb. 27, 2008) (explanatory note on evidence
Rule 502).
316. Id.
317. Id.
318. See supra note 232 and accompanying text.
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to determine the controlling effect of a federal court’s order.319 Therefore,
the chief criticisms of Rule 502(d) do not actually counsel against its use. A
Rule 502(d) order is nearly costless to the party who uses it and can provide
enormous benefit regardless of the privilege review ultimately undertaken.
The second problem of vague protective orders can be addressed by
new practices and a helpful suggestion in the Federal Rules of Civil
Procedure. Any party requesting a court to enter a protective order or
confidentiality order that governs attorney-client privilege and attorney
work product must specifically invoke Rule 502(d) by citing to it.320 This
clearly directs a subsequent court to adhere to the dictates of Congress on
the controlling effect of that order. Without this specific invocation, a
responding court should not construe a protective order to have more effect
than the court or the parties explicitly intended.
Additionally, Federal Rule of Civil Procedure 26(f) already directs
parties to discuss privilege issues and whether they would like their
agreement to be entered into a court order.321 I propose that a slight
modification to the rule be made to incorporate the recent amendment to the
federal rules of evidence. Any time an amendment to a rule is made, the
counter-balancing concern of clarity should be taken into account. Too
many factors reduce clarity surrounding Rule 502(d) orders; therefore, I
propose that rather than merely referring to an “order” in Rule 26(f)(3)(D),
the rule should be amended to state that parties should discuss:
(D) any issues about claims of privilege or of protection of trial
preparation materials, including claims made subsequent to production,
and whether to ask the court to include an order under Fed. R. Ev. 502(d).
This proposal removes the conditional agreement language that is
currently in the rule. Because Rule 502(d) does not require an agreement as
a requirement for the court to enter an order, the agreement language in
Rule 26(f) has limited value. Forming an agreement is preferable, as that is
the purpose of many of Rule 26(f)’s instructions, but it is no longer
required. Also, the rule’s “order” language would benefit from the
specificity of citing to Rule 502(d). This would promote litigants’
awareness of Rule 502(d), thereby more effectively accomplishing
Congress’s purpose in enacting it. Further, specifically citing to Rule 502(d)
would increase the clarity of many orders entered by courts, and parties
would be more inclined to explicitly state that they discussed Rule 502(d)—
as it would now be required—and chose to enter the order pursuant thereto.
319. See supra notes 234–40 and accompanying text (explaining why enforcing Rule
502(d) protective orders in state courts is constitutional).
320. See Grimm, Bergstrom & Kraeuter, supra note 15, at 80–82 (explaining how to
draft enforceable protective orders in a manner that clearly invokes Rule 502(d)).
321. Id.
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A litigant gains several benefits from utilizing the protections of Rule
502(d), and the risks are entirely controlled.322 Therefore, parties should
make Rule 502(d) part of their regular litigation practice, as it is essential to
achieving the certainty that is necessary to adequately maintain attorneyclient privilege and work-product protection. In furtherance of that end, the
Federal Rules of Civil Procedure should be amended to include reference to
Rule 502(d), ensuring that the rule achieves Congress’s goal of reducing the
cost of litigating in the United States courts.
322. See supra notes 4, 301, 308 and accompanying text.