Disclosure and Rule 502

Disclosure and Rule 502

Federal Rule of Evidence 502 governs the disclosure of a communication or information covered by the attorney-client privilege or work-product protection, and it governs only in the circumstances it sets out.¹ The earlier sections of this chapter dealt with keeping protected material from the other side through protective orders and the logging of withheld documents. Rule 502 takes up the next problem: the material has left the holder's hands, and the question is what protection remains.

Disclosure threatens work product because the protection exists to keep a lawyer's preparation from the adversary. In Hickman v. Taylor, the Court reasoned that if such materials were open to opposing counsel on mere demand, much of what is now put down in writing would remain unwritten, and an attorney's thoughts, heretofore inviolate, would not be his own.² The same point looks like this from the lawyer's chair. If work product were routinely discoverable, you would temper your written conclusions, or withhold sensitive ones in favor of oral briefings, and the quality and efficiency of trial preparation would suffer.³ A disclosure to the adversary or to an outsider hands over the very material the protection was meant to keep private, and the recipient can then argue that the holder gave up the protection.

The attorney-client privilege rests on a related logic. Privileges generally are designed to encourage the free flow of information among the persons inside a protected circle, and the attorney-client privilege fits that framework.⁴ A disclosure that carries a communication outside the circle is the event a waiver rule has to address.

Cost sharpens the problem. Most documents today are electronic, so a party may hold huge amounts of data responsive to a request, which it must preserve, locate, retrieve, and review; a court may limit production by balancing the requesting party's need against the burden and expense to the responding party.⁵ Every page of that review is a chance to release protected material by mistake, so the consequences of disclosure matter a great deal to the party doing the reviewing. Rule 502 puts the waiver provisions for both protections in a single rule. The sections that follow take up how far a waiver extends, when an inadvertent disclosure leaves protection intact, how disclosures in state proceedings are treated, and how a court order or party agreement can control waiver in advance.

Rule 502(g)(2) defines work-product protection as the protection that applicable law provides for tangible material, or its intangible equivalent, prepared in anticipation of litigation or for trial.⁶ Rule 502(g)(1) defines the attorney-client privilege the same way, as the protection that applicable law provides for confidential attorney-client communications.⁷ Both definitions borrow. A waiver rule must know what is being waived, but it need not restate the doctrine, and a second definition would create a body of work-product law running beside the one that already exists. In a federal civil case, the borrowed content is the work-product doctrine itself, governed by a uniform federal standard in Federal Rule of Civil Procedure 26(b)(3) and in Hickman.⁸ Rule 502 controls only what disclosure does to that protection.

The parenthetical about intangible equivalents has the same source. Hickman continues to protect work product that never takes tangible form, including the thoughts and recollections of counsel, and the protection reaches materials prepared by an attorney's agents and consultants as well as by the attorney.⁹ A written memorandum is tangible work product, and a lawyer's oral account of strategy is its intangible equivalent. Both fall within the definition, so the rule's provisions apply to the disclosure of either.

The first question any disclosure problem poses is whether Rule 502 answers it at all, and that depends on where and to whom the disclosure was made. The rule's waiver provisions operate when the disclosure is made in a federal proceeding or to a federal office or agency.

The first scene falls within the rule because the disclosure happened in a federal proceeding. The second falls outside because a private handover to a business partner is neither a disclosure in a proceeding nor a disclosure to a federal office or agency, and the rule operates only in the circumstances it sets out.¹⁰

The rule also reaches beyond federal courtrooms. Under Rule 502(f), it applies, notwithstanding Rules 101 and 1101, to state proceedings and to federal court-annexed and federal court-mandated arbitration proceedings, in the circumstances set out, and, notwithstanding Rule 501, it applies even if state law provides the rule of decision.¹¹ The two overrides solve different problems. The first carries the rule past the proceedings the evidence rules ordinarily govern. The second matters in a case such as a diversity suit, where state law supplies the rule of decision and would otherwise supply the privilege rules. Without the overrides, one disclosure could meet one waiver standard in federal court and another in a state forum, and a holder deciding whether to produce could not predict what the production would cost. How a disclosure made in a state proceeding is treated is a separate question that a later section takes up.

Disclosure to a government agency is a setting in which the rule matters in practice. The SEC's investigatory powers, for example, are enormous. Section 20(a) of the Securities Act, sections 21(a)(1) and (2) of the Exchange Act, section 209(a) of the Investment Advisers Act, and section 42(a) of the Investment Company Act authorize it to investigate past, ongoing, or prospective violations of the federal securities laws, the SEC's rules and regulations, and the rules and regulations of the various self-regulatory organizations.¹² A company drawn into an investigation of that breadth must decide what protected material, if any, to give the investigators.