Grolier Inc. v. Federal Trade Commission

Opinion for the court PER CURIAM. Opinion dissenting in part and concurring in part filed by Circuit Judge MacKINNON. PER CURIAM: Appellant Grolier filed suit under the Freedom of Information Act (FOIA)1 seeking documents relating to a covert investigation of one of its subsidiaries, the Americana Corporation. Federal Trade Commission (FTC) lawyers prepared these documents as part of a civil penalty action filed against Americana in 1972 by the Department of Justice. United States v. Americana Corp., Civil No. 388-72 (D. N.J.). The Americana action involved alleged misrepresentation in door-to-door sales and false advertising. The action was dismissed with prejudice on November 17, 1976, after the FTC disobeyed a court order to turn over certain materials to the defendants. In this FOIA case the District Court held that certain requested documents' — Numbers 1, 3, 5, 6, and 7 — constituted attorney work-product and that the FTC properly withheld them pursuant to Exemption 52 of the Freedom of Information Act.3 Grolier, Inc. v. FTC, D. D.C. Civil Action No. 79-1215, Memorandum filed February 21, 1980 at 3, Joint Appendix (JA) 113; Grolier, Inc. v. FTC, D. D.C. Civil Action No. 79-1215, Memorandum filed June 13, 1980 at 2, JA 118. There is no question that the documents involved were work-product prepared as part of the Americana action. Rather, the question on appeal is whether these documents continue to be privileged against disclosure several years after the Americana suit was terminated. I. TEMPORAL SCOPE OF THE WORK-PRODUCT PRIVILEGE Exemption 5 of FOIA “exempt[s] those documents, and only those documents, normally privileged in the civil discovery context.” NLRB v. Sears, Roebuck & Co., 421 U.S. 132, 149, 95 S.Ct. 1504, 1515, 44 L.Ed.2d 29 (1975). In the civil discovery context, [49] however, there exists a “dispute among the courts as to * * * whether the protection afforded by the [work-product] privilege lapses once the litigation has ended or the prospects of litigation have faded[.]” Coastal States Gas Corp. v. Dep’t of Energy, 617 F.2d 854, 865 (D.C.Cir.1980). Indeed, courts have followed three different approaches in deciding whether the work-product privilege extends beyond the termination of litigation.4 At one extreme, some courts have concluded that the work-product privilege applies only if the materials were prepared in anticipation of the very suit before the court; documents prepared for one case are thus freely discoverable in a different case. E.g., United States v. Internat'l Business Machines Corp., 66 F.R.D. 154, 178 (S.D.N.Y.1974) (document must be prepared in anticipation of litigation in the case in which the special immunity accorded to such material is sought); Honeywell, Inc. v. Piper Aircraft Corp., 50 F.R.D. 117, 119 (M.D.Pa. 1970) (same); Hanover Shoe, Inc. v. United Shoe Machinery Corp., 207 F.Supp. 407, 410 (M.D.Pa.1962) (materials must be prepared for the case at bar); Gulf Construction Co. v. St. Joe Paper Co., 24 F.R.D. 411, 415 (S.D.Tex.1959) (same); Tobacco & Allied Stocks, Inc. v. Transamerica Corp., 16 F.R.D. 534, 537 (D.Del.1954) (same). At least one of these courts has noted that the seminal case of Hickman v. Taylor, 329 U.S. 495, 67 S.Ct. 385, 91 L.Ed. 451 (1947), involved materials prepared in anticipation of the litigation then before the court. Gulf Construction Co. v. St. Joe Paper Co., supra, 24 F.R.D. at 415. At the other extreme, some courts have held that there is “a perpetual protection for work product” extending beyond the termination of the litigation for which the documents were prepared and reaching all subsequent suits. In re Murphy, 560 F.2d 326, 334 (8th Cir. 1977) (emphasis added). Accord, Duplan Corp. v. Moulinage et Retorderie de Chavanoz, 487 F.2d 480, 483-484 (5th Cir. 1973) (rationale for work-product rule scarcely less applicable to a closed case than to one still being contested); United States v. O.K. Tire Co., 71 F.R.D. 465, 468 n.7 (D.Idaho 1976); Burlington Industries v. Exxon Corp., 65 F.R.D. 26, 43 (D.Md.1974). A third, intermediate approach is that the extension of the work-product privilege from one case to a subsequent one turns on “whether the first action was complete and upon the relationship between the first and second actions.” 4 J. Moore, Federal Practice ¶ 26.64[2] at 26-415 (2d ed. 1979). In the same vein, another leading commentator has found the “sounder view” to be that “documents prepared for one case have the same protection in a second case, at least if the two cases are closely related.” 8 C. Wright & A. Miller, Federal Practice and Procedure § 2024 at 201 (1970) (emphasis added). See Cooper, Work Product of the Rulesmakers, 53 Minn.L.Rev. 1269, 1299 n.100 (1969) (view that privilege terminates is tenable “only when there is no danger of disclosure to others pursuing claims related to the claims involved in the litigation giving rise to the one-time work product materials”). A substantial body of case law supports the conclusion that the work-product privilege extends to subsequent cases only when they are related. See, e.g., Republic Gear Co. v. Borg-Warner Co., 381 F.2d 551, 557 (2d Cir. 1967); Hercules Inc. v. Exxon Corp., 434 F.Supp. 136, 153 (D.Del.1977); Midland Investment Co. v. Van Alstyne, Noel & Co., 59 F.R.D. 134, 138 (S.D.N.Y. 1973). The paradigmatic situation is posed by Philadelphia Electric Co. v. Anaconda American Brass Co., 275 F.Supp. 146 (E.D. Pa.1967), where documents prepared in defense of a criminal antitrust action were found to be within the work-product rule in a subsequent civil antitrust suit.5 [50] Extending the work-product protection only to subsequent related cases best comports with the fact that the privilege is qualified, not absolute.6 Hickman v. Taylor, supra, 329 U.S. at 511, 67 S.Ct. at 393. “ ‘[BJecause the privilege obstructs the search for truth and because its benefits are, at best, “indirect and speculative,” it must be “strictly confined within the narrowest possible limits consistent with the logic of its principle.” ’ ” In re Grand Jury Proceedings (FMC Corp.), 604 F.2d 798, 802-803 (3d Cir. 1979) (quoting In re Grand Jury Proceedings (Sun Co.), 599 F.2d 1224, 1235 (3d Cir. 1979)). The purpose of the privilege, as this court has made clear, “is to encourage effective legal representation within the framework of the adversary system by removing counsel’s fears that his thoughts and information will be invaded by his adversary. In other words, the privilege focuses on the integrity of the adversary trial process itself * * *.” Jordan v. U.S. Dep’t of Justice, 591 F.2d 753, 775 (D.C.Cir.1978) (en banc) (emphasis in original; footnote omitted). Therefore, in order to fall within the scope of the privilege a document “must ‘relate to the conduct of either ongoing or prospective trials; [it must] include factual information, mental impressions, conclusions, opinions, legal theories or legal strategies relevant to any on-going or prospective trial.’ ” Exxon Corp. v. FTC, 663 F.2d 120, 129 (D.C.Cir.1980) (emphasis added; brackets in original) (quoting Jordan v. U.S. Dep’t of Justice, supra, 591 F.2d at 775-776). When litigation has ended and no potential for related actions exists, concerns about possible inroads on the integrity of the adversary system greatly diminish. Indeed, “where the work-product materials in question were prepared for a distinct and prior * * * litigation, long completed, the policies underlying the work-product privilege have already been achieved.” In re Grand Jury Proceedings, 73 F.R.D. 647, 653 (M.D.Fla.1977). Moreover, we deal in this case, not with the civil discovery situation, but rather with a Freedom of Information Act request. Here, the presumption in favor of disclosure is at its zenith. “[Disclosure, not secrecy, is the dominant objective of the Act.” Dep’t of Air Force v. Rose, 425 U.S. 352, 361, 96 S.Ct. 1592, 1599, 48 L.Ed.2d 11 (1976). As this court wrote in Mead Data Central, Inc. v. U.S. Dep’t of Air Force, 566 F.2d 242, 259 (D.C.Cir.1977): The exemptions from the mandatory disclosure requirement of the FOIA are both narrowly drafted and narrowly construed in order to counterbalance the self-protective instincts of the bureaucracy which, like any organization, would prefer to operate under the relatively comforting gaze of only its own members rather than the more revealing “sunlight” of public scrutiny. Where there is a balance to be struck, Congress and the courts have stacked the scales in favor of disclosure and against exemption. * * * Accordingly, we hold that, in the context of an FOIA request, attorney work-product from terminated litigation remains exempt from disclosure only when litigation related to the terminated action exists or potentially exists. [51] II. APPLICATION OF THE “RELATED LITIGATION” TEST Grolier seeks documents prepared for the Americana action. Since that suit was dismissed with prejudice five years ago, it cannot be resurrected. Grolier is also a plaintiff in a Ninth Circuit case challenging an FTC order, but that case and order apparently are not related in any way to the Americana action. See FTC’s “Statement of Material Facts as to Which There is No Genuine Issue,” ¶ 9, JA 25. In addition, the FTC has long abandoned the covert investigation techniques discussed in the requested documents. Under these circumstances, there does not appear to be any suit or potential suit related to the original Americana action. Nonetheless, since this issue has not been fully explored, we remand the case to the District Court for reconsideration of the applicability of the work-product privilege in light of the apparent absence of related litigation. This judgment applies to Documents 3, 5, 6, and 7. With respect to Document 1, while we find that the work-product privilege may not apply, the document is still exempt from disclosure under Exemption 5 because it is clearly a pre-dccisional document. See Jordan v. U.S. Dep’t of Justice, supra, 591 F.2d at 774. Thus, the judgment of the District Court as to Document 1 is affirmed. The dissent would affirm the District Court’s judgment because it concludes that “the present [FOIA] suit could not be more directly related to the Americana litigation.” Dissent, 671 F.2d at 559. While we agree that the work-product privilege extends to a second case if the second case is closely related to the first, see id. (citing C. Wright & A. Miller), Judge MacKinnon has, in our judgment, misapplied this test. Indeed, we find it illogical to use the filing of an FOIA suit as the sole basis for foreclosing appellant’s access to the requested documents. Under the dissent’s theory, any material that was work product at any time would never be disclosable under FOIA because the filing of the FOIA suit itself would constitute “related” litigation. We reject this strange view of the related litigation test. The Americana suit was a civil penalty action involving misrepresentation in door-to-door sales and false advertising. The government’s investigation and litigation strategy in such an action obviously would have little, if anything, to do with its strategy in defending this FOIA suit. The FOIA suit does not in any way relate to the substance of the earlier litigation. Thus, for purposes of the work-product privilege, the two cases are neither “closely related” nor even “related.” III. CONCLUSION For the reasons given above, we affirm the judgment of the District Court as to Documents 1 and 4. However, we vacate the judgment of the District Court as to Documents 3, 5, 6, and 7, and remand the case for reconsideration of the applicability of the work-product privilege in light of the apparent absence of litigation related to the Americana suit. So ordered. Footnotes [1] 5 U.S.C. § 552 (1976). [2] Id. § 552(b)(5). [3] Grolier has withdrawn its claim for disclosure of Document 2. As for Document 4, we affirm the District Court’s judgment that the document was exempt from disclosure under Exemption 5 as an attorney-client communication. [4] Most cases dealing with this subject are from District Courts. New discovery cases reach the appellate level because interlocutory orders are not appealable under the final order doctrine. Note, 1974 Duke L.J. 799, 817 n.95. [5] This intermediate view is consistent with Mervin v. FTC, 591 F.2d 821 (D.C.Cir.1975), which the dissent cites. In Mervin the plaintiff brought suit for disclosure of documents under [50] the FOIA and for job reinstatement and damages on the basis that his dismissal was wrongful. Id. at 824. Mervin sought disclosure of documents prepared by government attorneys while defending an earlier suit for job reinstatement he had brought, which had been dismissed for failure to exhaust administrative remedies. Id. at 825. Thus the documents Mervin sought as part of his second suit for reinstatement were the government’s work product from his first suit for reinstatement. The two actions were not merely closely related, they were identical. [6] Indeed, courts extending the privilege to subsequent cases have often relied on the qualified nature of the privilege in doing so. See, e.g., United States v. Leggett & Platt, Inc., 542 F.2d 655, 660 (6th Cir. 1976), cert. denied, 430 U.S. 945, 97 S.Ct. 1579, 51 L.Ed.2d 792 (1977) (“Were the work product doctrine an unpenetrable protection against discovery, we would be less willing to apply it to work produced in anticipation of other litigation. But the work product doctrine provides only a qualified protection against discovery * * *.”).