Pallares v. Kohn
650 F.3d 276
3rd Cir.2011Background
- Chevron sought discovery under 28 U.S.C. § 1782 from attorney Joseph C. Kohn and Kohn, Swift & Graf (KSG) related to the Lago Agrio litigation in Ecuador.
- Crude, a documentary about the Lago Agrio litigation, included Kohn and Donziger, among others, filmed during meetings in the United States.
- District Court held that Crude filming caused a broad waiver of the attorney-client privilege for Kohn’s Lago Agrio communications and rejected the privilege for those documents.
- Ecuadorian plaintiffs and the Republic of Ecuador intervened and challenged the district court ruling, including the waiver theory and privilege scope.
- Chevron argued that the crime-fraud exception could apply to vitiate the privilege and support discovery, or alternatively, that the waiver should be upheld for all communications.
- Third Circuit held Crude communications were not privileged because of filming, reversed the district court’s waiver ruling, and remanded to consider the crime-fraud exception.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was Crude footage a violation that destroyed privilege as to related communications? | Chevron contends broad waiver due to public filming. | Ecuadorians argue presence of strangers should not destroy privilege for all related communications. | No privilege attached; no waiver for Kohn’s Lago Agrio files. |
| Did the district court correctly apply the crime-fraud exception on remand? | Chevron seeks remand to apply crime-fraud exception to vitiate privilege. | Record insufficient to show prima facie crime-fraud; needs fact-finding. | Remand allowed; crime-fraud issue to be considered by district court. |
| Can the crime-fraud evidence alone sustain discovery if privilege did not attach? | Crime-fraud would justify discovery notwithstanding waiver issues. | Crime-fraud requires link between client and attorney’s communications; not shown here. | Not decided; requires remand and fact-specific analysis. |
Key Cases Cited
- In re Teleglobe Communications Corp., 493 F.3d 345 (3d Cir. 2007) (attorney-client privilege requires confidential communications among privileged persons)
- Murray v. Gem-plus International, 217 F.R.D. 362 (E.D. Pa. 2003) (limited disclosure may prompt fairness considerations in waiver)
- Westinghouse Elec. Corp. v. Republic of the Philippines, 951 F.2d 1414 (3d Cir. 1991) (presence of strangers can defeat privilege; issues of waiver fairness)
- In re Bayer AG, 146 F.3d 188 (3d Cir. 1998) (standard for when to exercise discretion in privilege rulings)
- Hudson United Bank v. LiTenda Mortgage Corp., 142 F.3d 151 (3d Cir. 1998) (fact-sensitive inquiry on crime-fraud exception and privilege)
- In re Grand Jury Investigation, 445 F.3d 266 (3d Cir. 2006) (prima facie showing elements for crime-fraud exception)