In Re Grand Jury, 23f4th1088

Company and Law Firm were served grand jury subpoenas seeking documents in a criminal investigation of Company’s owner, who was also a client of Law Firm.
Both produced some materials but withheld others claiming attorney-client privilege and work-product protection; government moved to compel and the district court ordered production in part and found some documents not privileged or subject to the crime-fraud exception.
After continued withholding, the district court held Company and Law Firm in contempt for failing to comply with the subpoenas.
Central disputed issue: whether dual-purpose communications (legal + tax/business) are privileged — specifically which legal test governs privilege for dual-purpose materials.
The Ninth Circuit affirmed the contempt orders and held that the attorney-client privilege for dual-purpose communications is governed by the “primary-purpose” test; it did not adopt Kellogg’s broader “a primary purpose” formulation and left that question open.

Issue	Appellants' Argument	Government's Argument	Held
Which test governs privilege for dual-purpose communications: “primary-purpose” vs. “because of”?	Favor applying the broader “because of” test (borrowed from work-product) so communications made because of legal needs are privileged.	Argued communications were not privileged; district court applied the primary-purpose test and found tax/business purpose predominant.	The primary-purpose test governs attorney-client privilege for dual-purpose communications; affirmed contempt orders.
Whether to adopt Kellogg’s formulation (“a primary purpose” = one of several significant purposes) instead of a single predominant “the primary purpose”	Urged adopting Kellogg’s “one of the significant purposes” approach to avoid artificially forcing a single predominant purpose finding.	Pointed to risks of overbroad privilege and to precedent favoring predominant-purpose analysis.	Court declined to adopt Kellogg’s formulation here, left the question open, and affirmed because the district court’s finding that legal advice was not the predominant purpose was not clearly erroneous.

United States v. Sanmina Corp., 968 F.3d 1107 (9th Cir. 2020) (discussed dual-purpose communications and circuit split)
In re Grand Jury Subpoena (Mark Torf/Torf Env’t Mgmt.), 357 F.3d 900 (9th Cir. 2004) (articulated the work-product “because of” test)
In re County of Erie, 473 F.3d 413 (2d Cir. 2007) (adopted predominant-purpose test for privilege)
Swidler & Berlin v. United States, 524 U.S. 399 (U.S. 1998) (explains privilege scope guided by common law principles)
United States v. Abrahams, 905 F.2d 1276 (9th Cir. 1990) (distinguishes privileged legal advice about tax positions from nonprivileged raw tax figures)
United States v. Rowe, 96 F.3d 1294 (9th Cir. 1996) (privilege covers communications made to facilitate legal services)
Fisher v. United States, 425 U.S. 391 (U.S. 1976) (privilege protects disclosures necessary to obtain informed legal advice)
In re Kellogg Brown & Root, Inc., 756 F.3d 754 (D.C. Cir. 2014) (advocated a “one of the significant purposes” version of primary-purpose test)
United States v. Adlman, 134 F.3d 1194 (2d Cir. 1998) (explains broader work-product policy and the “because of” test)
Olender v. United States, 210 F.2d 795 (9th Cir. 1954) (tax-return preparation communications generally not privileged)