The Supreme Court has issued its decision in Mohawk Industries, Inc. v. Carpenter, No. 08-678, discussed in my posts of September 25th and October 9th.
In Mohawk, the Court addressed a circuit split on whether the collateral order doctrine permits an immediate appeal of a discovery order permitting discovery based on a finding of a waiver of the attorney-client privilege.
At issue in the case was information concerning an interview that a former employee of Mohawk had with Mohawk's outside counsel while he was still employed by Mohawk. Mohawk argued that the interview and any documents related to it were privileged, but the district court ruled that Mohawk had waived the privilege previously and so the materials were discoverable. The court of appeals declined to accept an interlocutory appeal, holding that the collateral order doctrine did not apply because the discovery order would not be “unreviewable” on appeal from the district court’s final judgment.
The Supreme Court upheld the Eleventh Circuit's ruling in a decision issued December 8th, rejecting decisions in the Third, Ninth and D.C. Circuits that had permitted interlocutory appeals of discovery-related orders compelling production of arguably privileged materials under the collateral order doctrine.
The Court recognized that its stringent standards for immediate appeals "may burden litigants in ways that are only imperfectly reparable by appellate reversal of a final district court judgment," but that "has never sufficed." Slip op. at 5 (internal quotation omitted). As the Court framed the issue, the "crucial question, however, is not whether an interest is important in the abstract; it is whether deferring review until final judgment so imperils the interest as to justify the cost of allowing immediate appeal of the entire class of relevant orders." Slip op. at 7. The Court concluded that "postjudgment appeals generally suffice to protect the rights of litigants and assure the vitality of the attorney client privilege. Appellate courts can remedy the improper disclosure of privileged material in the same way they remedy a host of other erroneous evidentiary rulings: by vacating an adverse judgment and remanding for a new trial in which the protected material and its fruits are excluded from evidence." Slip op. at 8.
Finally, the Court noted that in extreme circumstances, a disgruntled litigant still retains limited options for seeking an interlocutory appeal of a privilege-related discovery order. The party could ask the district court to certify, and the appellate court to accept, an immediate appeal under 28 U.S.C. § 1292(b); the party could petition for mandamus review; the party could "defy a disclosure order and incur court-imposed sanctions"; or the party could invite the district court to hold it in contempt for disobeying the court's disclosure order, from which the "party can then appeal directly from that ruling, at least when the contempt citation can be characterized as a criminal punishment." Slip op. at 9-10.
Justice Thomas issued a concurring opinion, essentially asserting that the Court's collateral order case law has created a mess that should be avoided altogether in favor of a clear, predictable application of the appellate jurisdiction statute, which effectively would abolish the collateral order doctrine altogether.
In reality, those appellate options are extremely narrow and difficult to obtain, and most parties may be unwilling to risk sanctions or contempt, meaning that most litigants who believe they've been ordered to turn over materials they think are privileged will have little recourse until an eventual appeal post-judgment. And by that point, the ability to effectively raise the discovery ruling in the context of whatever other substantive legal issues are on appeal may be minimal.
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