THE BATTLE OF MINNESOTA Document Discovery In The 1997 Minnesota Tobacco Litigation. I. INTRODUCTION Although any legal observer would tell you the prospect long loomed on the horizon, on July 14, 2000, when a Florida jury handed down a judgment of $144. 8 billion dollars against the seven major tobacco companies, the mental shock of hearing such a figure was still staggering. It remains unclear as of this writing exactly how much of this massive verdict will ever be collected by the plaintiffs - a behemoth class of Florida smokers - injured by the products marketed, manufactured and sold by the defendants. In the days immediately following the judgement, the tobacco industry carried on business as usual and even the companies's tock prices remained largely unchanged.
Irrespective of the minimal immediate financial and social effects of this judgment, the legal implications for the tobacco industry, the plaintiff's bar, and the state and federal government entities presently bringing suit for tobacco related harms, cannot be overemphasized. The Florida judgment, the largest in civil legal history, although unique in its outcome, was only one more chapter in the long and still unfolding saga of American tobacco litigation. After many years of successfully fighting countless "wars" in the arena of civil mass torts, Goliath had fallen, and although he was far from dead, he could no longer afford to laugh at the prospect of the battle before him. The husband and wife legal team of Stanley and Irene Rosenblatt had successfully felled an opponent that, less than a decade earlier, had toppled even the best and brightest of the plaintiff's bar. The Florida plaintiffs' arsenal, however, was filled with the unique and powerful ammunition of countless "confidential" documents passed between the defendants' employees, and even their legal counsel. Without a slingshot full of these stones, Goliath was unlikely to have fallen, and the manner, and legal justification for how they were introduced into evidence remains a controversy of great legal significance.
For even now, as the practical and legal ramifications of the Florida case and judgment remain unclear, many legal scholars are still busy debating the outcome of a prior legal battle, without which the Florida judgment never could have occurred: the battle of Minnesota. II. Tobacco Litigation - A History of The Three "Waves"A. The "First Wave" (1950 - 1980) For ease of reference, the history of tobacco litigation is usually summarized into three "waves." The first wave, largely inspired by several significant early studies on the adverse effects of smoking on human health, began in the mid 1950's and consisted primarily of personal injury suits brought on by individual smokers against individual tobacco companies. The defendant tobacco companies emerged from these early cases entirely victorious, largely due to the success of their argument that plaintiffs could not prove a sufficient causal link between smoking and cancer. Critical to these victories was the defendant companies' contention that they were unable to "foresee" the potential health risks of smoking and lacked sufficient information about those risks to research them and warn the plaintiff consumers.
In one of the earliest "first wave" tobacco cases that went to trial, Lartigue v. R. J. Reynolds Tobacco Company, the tobacco companies constructed their case mainly around the argument that the plaintiff's cancer could not be causally linked to his use of the defendants' products. Discussing the jury's likely rationale for its verdict, the trial judge wrote that he regretted his failure to propound an interrogatory, as had been requested by the plaintiff with respect to the connection between smoking and the plaintiff's lung cancer, lamenting that the jury "never got beyond" the question of causation and had "simply decided" the case because they were unable to resolve the issue of what "causes" cancer. The issue of causality is one of some contention in all fields of the natural and social sciences, and not one which needed to be fully resolved in order to find the defendants liable.
The court of appeals upheld the jurors' verdict and noted that a risk must be "reasonably foreseeable" before a manufacturer could be held liable. Reflecting on this stage of tobacco litigation, in light of the extensive body of smoking and health research currently available to the public, it is easy to forget at in the 1960's and 70's, the public debate on the risks of smoking was far less prevalent, and the tobacco companies were doing most of the talking. Internal tobacco industry documents, only made available in the 1990's, reveal that the then-defendant companies were well aware of the causal link between smoking and cancer, however such information would not come to public light for nearly 30 years, and the industries smokescreen (pardon the pun) relating to the ambiguity of such causation was largely successful. B.
The Second Wave (1980 - 1993) In 1964 the United States Surgeon General issued a landmark report on smoking and health which stated definitively, among other things, that smoking caused lung cancer in men. This report, which created a massive public interest in the ill effects of smoking on human health, led to countless other private and public studies of the same topic in subsequent years, as well as federally-mandated warning labels on cigarette packaging and advertisements. In spite of this pronouncement, however, the courts heard very little cigarette products liability litigation from 1965 to 1980. Plaintiff's were likely discouraged by the difficulties of proving smoking "causes" cancer, and the apparent inability to secure a jury verdict against cigarette makers without such a link. The second wave of tobacco litigation, which began in the early 1980 s, also consisted mainly of individual personal injury suits brought by ill smokers against individual tobacco companies. During this stage of the litigation, in the wake of the public attention paid to the relationship between cigarettes and illness, the tobacco companies changed their defense philosophy.
The companies stated that the link between smoking and illness was now "common knowledge" and, therefore, individuals who continued to engage in the activity of smoking were simply exercising their "freedom of choice." Thus, as one plaintiff's counsel characterized it, the second-wave tobacco defendants had; "not without a certain audacity, seamlessly shifted their battle cry from the first wave of litigation - "smoking doesn't cause cancer" - to their battle cry in the second wave of litigation - "everybody knows that smoking causes cancer." In the face of this new argument plaintiffs' counsel faced the most frustrating challenge of the second-wave. The defendants' "freedom of choice" argument could be easily refuted by presenting conclusive evidence of what most smokers (and former smokers) were already aware of: smokers are addicted to nicotine. Like causation, however, the concept of addiction in general was a matter of intense scientific debate. How much of what is typically referred to as "addiction" was physiological, and how much was psychological was a widely contested issue.
Some scientists maintained that without the "classic" addiction model components of increased tolerance and subsequent dosage increase, a substance could not be properly called "addictive." Yet others maintained that any substance which creates a persistent craving for future use despite adverse effects on other aspects of one's well being, could be classified as "addictive." The debate was far from over, and like the issue of causation, had the prospect of never being 100% resolved. Although tobacco executives long maintained ignorance of any "habit forming" or "addictive" properties to their products, later review of industry documents would prove that the tobacco company defendants were long aware of the addictive properties of their product. The second-wave of tobacco litigation was, in retrospect, far more successful than the first in that it yielded the first significant discovery successes against the industry. In Cipollone v. Liggett Group, Inc. plaintiff's obtained the first meaningful document disclosure against "big tobacco" when a pretrial ruling compelled the tobacco industry to release thousands of pages of confidential internal documents.
Plaintiffs alleged that these documents would prove a conspiracy among the tobacco companies to prevent the release of damaging information on the health hazards of cigarette smoking. These documents offered what one group of plaintiff's attorneys characterized as "the first glimpse of the treasures that would be found in the industry's files." Cipollone and its companion case, Haines v. Liggett Group, Inc. offered insight into the extent to which tobacco industry lawyers had come to play a significant role in shielding critical documents from discovery through improper claims of privilege.
It was, for example, common practice for the defendant companies to have their "scientific" research conducted under the close supervision, and sometimes management, of their attorneys. The idea of this strategy being that bad findings could be held back as "lawyer-client confidences" whereas good findings could be described as the product of scientific inquiry. In Haines U. S. District Judge H. Lee Sarokin denounced these type practices, stating that the tobacco industry, "may be the king of concealment and disinformation." Judge Sarokin's holding, and its ramifications, will be examined in more detail below.
Lacking the "smoking gun" documents which would prove either the industry knew that its product caused cancer or that nicotine was, by its nature addictive. The second-wave of tobacco litigation was largely unsuccessful in obtaining recovery for any plaintiffs's smoking related illnesses. Additionally, the tobacco industries' litigation style had reached such a level of notoriety that relatively few members of the plaintiff's bar would accept tobacco related cases. This litigation style was best summarized by one tobacco industry lawyer who candidly wrote in 1988:" The aggressive posture we have taken regarding depositions and discovery in general continues to make these cases extremely burdensome and expensive for plaintiffs' lawyers, particularly sole practitioners. To paraphrase General Patton, the way we won these cases was not by spending all of our [RJR] money but by making our opponent spend all of his." Those individual attorneys and firms who were brave (or foolish) enough to initiate litigation against the defendant tobacco companies during the second-wave, found themselves engaged in the "General Patton" style of litigation favored by the tobacco industry. Although this strategy was legally permissible, the propriety of this type of discovery practice is questionable in light of Model Rule 3.
4 (d) sanctioning Frivolous Discovery Practice. One legal scholar wrote:" The tobacco industry has developed several evasion strategies of choice, including but not limited to, delay, inundating an opponent with reams of useless information, use of the court system to wage a war of motions and protective orders against an adverse party, as well as filing patently false and misleading responses to discovery requests. Every strategy is designed to force the massive expenditure of frequently scarce plaintiff's resources in order to sort out the data provided or fight for the enforcement of discovery orders." Describing how the industry's litigation strategy and discovery practices had ensured it would be prohibitively expensive for the plaintiff's bar to represent injured smokers, one scholar wrote:" They [the tobacco industry] have done this by resisting all discovery aimed at them, thus requiring a court hearing and order before plaintiffs can obtain even the most rudimentary discovery. They have done it by getting confidentiality orders attached to the discovery materials they finally produce, thus preventing plaintiffs' counsel from sharing the fruits of discovery and forcing each plaintiff to reinvent the wheel." By the time the third-wave of tobacco litigation began in 1994, the legal community seems to have been, albeit unspoken ly, in agreement that no individual claim by an individual smoker would likely be able to sustain the prolonged legal warfare encountered when one goes after tobacco defendants.
Anti-tobacco forces, and members of the plaintiffs' bar had found new hope for their future when, in 1994, the "Merrell Williams" documents were disclosed. Merrell Williams was a paralegal working for a law firm representing Brown & Williamson. Mr. Williams went public with about 4, 000 pages of internal company documents from B&W, the majority of which provided, in detail, the decades of concealment perpetrated by the tobacco industry.
Although getting these questionably obtained and arguably "confidential" documents into evidence promised (and would prove to be) no small task - the battle cry was sounded and the third-wave began. C. The Third Wave (1994 - Present) In the third wave, the fundamental nature of the claims against tobacco shifted from individual smoker claims, to suits brought by state governments against the industry seeking wide-scale injunctive relief and to recover the costs to the states for medical care of injured smokers. In 1994, the states of Mississippi and Minnesota were the first to file such complaints against the industry.
In this third wave, large class action suits on behalf of smokers were also filed against the tobacco industry, including the Florida claim currently captivating our collective social attention. It was this third-wave which produced what may some day be heralded as the first true "victories" for tobacco litigation plaintiffs. Mindful of the industry's past history of contesting and successfully preventing nearly all glimpses into their internal correspondences and records, the Minnesota plaintiffs, first to file and accordingly, first to fight, early on determined that they would wage the most comprehensive and vigorous discovery battle possible against their adversary. It was their success in this battle which would, unbeknownst to them at the time, provide to all future tobacco litigation plaintiffs the critical ammunition they needed to wage war against the forces of big tobacco. III. The Rules of Discovery Any comprehensive understanding of the "third wave" of tobacco litigation would be incomplete without an accompanying understanding of the "discovery wars" which preceded them.
Understanding these preliminary battles requires, however, a clear understanding of the attorney-client privilege, the work product doctrine, the joint defense privilege and the crime-fraud exception to these privileges. A. The Attorney-Client Privilege The attorney-client privilege is a well-established core component of American jurisprudence. Courts have long recognized that individuals and corporations must be able to confer openly with counsel free from the fear that such communication could be used against them. In our highly regulated modern corporate society, courts are even more aware of the need for corporations to converse continually with counsel, even if only to comply with the maze of state and federal laws and regulations that govern corporate conduct. The exact contours of the attorney-client privilege are unclear, however, and open to varying interpretations depending on the interests of those seeking it, or seeking to overturn an assertion of privilege.
The elements of the privilege are clearly established where: (1) legal advice of any kind is sought; (2) from a professional legal adviser in his capacity as such; (3) the communications relate to that purpose; (4) are made in confidence; (5) by the client; (6) are at his or her instance permanently protected; (7) from disclosure either by the client or the legal adviser, (8) except the protection be waived. In virtually all tobacco related litigation, plaintiffs' counsel concentrated their arguments on the question of what constitutes "legal advice" from attorney to client and what subject matter may be properly claimed as pertaining to legal advice and thus privileged. The tobacco industry, not surprisingly, took a very expansive view of privilege, arguing that privilege protects any "confidential communication" between client and counsel, between counsel, or even between client representatives. B. The Work Product Doctrine Under the work product doctrine, documents or tangible things prepared in anticipation of litigation are subject to a qualified immunity. This immunity does not, as the Supreme Court elucidated in Hickman v.
Taylor, prevent the discovery of "all written materials obtained or prepared by an adversary's counsel with an eye toward litigation" A great majority of activities engaged in by corporate counsel are performed "with an eye toward litigation," however, that is, in an effort to prevent the need for and initiation of litigation and to minimize the corporations' financial exposure when litigation is unavoidable. Accordingly, the work product doctrine, like the attorney-client privilege offers protection only where an attorney is "giving legal advice" to a client. Work product protection does not extend to investigations conducted in the ordinary course of business. If a lawyer is asked to oversee a factual investigation, he may not be treated as acting in a legal capacity.
Otherwise a litigant could shield from discovery or refuse to disclose any knowledge it obtained from a particular investigation by claiming it was communicated to them by a lawyer. Likewise, pre-existing documents are not transformed into "work product" just because they were requested or reviewed by an attorney in preparation for litigation. Before any communication is privileged, it must "involve application of law to facts or the rendering of an opinion of law in response to the client's legal inquiries." The boundaries of the doctrine are mapped by balancing the interest in providing lawyers with "a certain degree of privacy, free from unnecessary intrusion by opposing parties and their counsel," against the societal interest in ensuring that the parties obtain "mutual knowledge of all the relevant facts." So the purpose of the rule is essentially to protect the adversary trial process, not to provide "loopholes" for attorneys seeking to hide damaging documents. The work product privilege exists "to promote the adversary process, not to pervert it." The protection cannot, in other words, "be used as a sword rather than a shield." C.
The Crime-Fraud Exception The production of an otherwise properly privileged document may be required under the crime-fraud exception to the attorney-client privilege. The rationale behind this exception was enunciated by the Supreme Court in Clark v. United States in which the Court determined that communications that facilitate the commission of crimes or frauds are not worthy of protection and that the client who consults with an attorney seeking to "serve him in the commission of a fraud will have no help from the law. He must let the truth be told." This exception applies specifically to future or ongoing crimes or fraud - and does not apply to legal advice sought to determine how to deal with a past fraud or crime.
An ambiguous component of this exception, and one which became a key debate of the Minnesota tobacco litigation, is what definition of "crime" and / or "fraud" is applicable in crime-fraud exception determinations. One point of contention remains whether or not the criminal elements of "fraud" must be met - or whether conduct such as a "bad faith" breach of duty may be sufficient to invoke the exception. Further, if these requirements need not be met to invoke the exception, does a finding that the crime-fraud exception applies in the discovery context constitute a substantive finding (or at least lead to a possibly prejudicial inference) that a party is guilty of a crime or liable for fraud? The potential for this exception to lead to "trial by preliminary motion" has been a source of justified concern to legal scholars and judges. In order to determine whether the crime-fraud exception applies the party challenging the assertion of privilege usually must demonstrate a "factual basis adequate to support a good faith belief by a reasonable person... that in camera review of the materials may reveal evidence to establish the claim that the crime-fraud exception applies." The decision whether or not the party has made a showing sufficient to trigger such an in camera inspection rests in the trial court's discretion. After in camera review and after the party asserting the privilege is given opportunity to be heard, the court must determine if there has been a "prima facie" showing that the allegedly privileged communications were made in furtherance of a crime or fraud.
Even if such a determination is made, however, not every privileged documents loses protection, only those "closely related" to the crime or fraud. Whether documents are "in furtherance of" or "closely related to" the crime-fraud is again, vested in the discretion of the court. Judge Skelly Wright summarized the logic of this process, stating; "The point is not to convict anyone of a crime or to anticipate the grand jury, but only to determine whether the possibility that a privileged relationship has been abused is sufficient to alter the balance of costs and benefits that supports the privilege. In making this determination courts will not be able to receive a complete adversary presentation of the issues, since of the parties will not be privy to the information at issue.
Any system that requires courts to make highly refined judgments - perhaps concerning volumes of documents - will most likely collapse under its own weight. As one might already imagine, however, any process in which so many arguably ambiguous terms are essential to evidentiary outcomes - is simply opening the doors to a massive pre-trial showdown. IV. Trial By Discovery - The Battle of Minnesota Mindful of the discovery challenges encountered by all prior tobacco litigants, the Minnesota plaintiffs' team, representing the State of Minnesota and Blue Cross Blue Shield of Minnesota recognized from the outset the importance of a focused and unwavering document discovery process. The tobacco industry initially offered to produce in Minnesota those documents it had previously disclosed in litigation elsewhere - preventing Minnesota from being forced to "reinvent the wheel" like so many other past plaintiffs.
In a move undoubtedly surprising to some, however, plaintiffs counsel refused this offer. Although characterized by some as "contrary to conventional wisdom," this refusal proved advantageous to the plaintiffs. After all the smoke cleared, Minnesota courts compelled the production of nearly five-times more documents than had ever been produced by the industry in all past litigation. Such a result was not, however, obtained without a fight - and the tobacco industry left no legal stone unturned in their efforts to minimize what the plaintiffs (and possibly the jury) would get their eyes on. A.
War of The Words The tobacco attorneys began the discovery battles in Minnesota by playing seemingly endless semantic games, claiming to be ignorant of what documents were at issue. Beyond the customary "over breadth" objections which prevent discovery from becoming a "fishing expedition," the defense fought or delayed disclosure at every turn. Industry attorneys claimed, for example, that they did not what such specific and concise terms as "smoking", "addictive", "advertising", or "antitrust" meant in Minnesota's document requests. Brown & Williamson, for example, characterized the plaintiff's definition of the term "smoking and health" as "overly broad, unduly burdensome, vague and ambiguous," and "not reasonably calculated to lead to the discovery of admissible evidence." Forced to deal with a subject matter highly specific in some areas (such as sales and manufacturing, chemical compounds and scientific research) and highly theoretical in others (such as the precise definitions of "addiction" or "marketing"), the Minnesota plaintiffs were forced to bring countless motions to compel. B. The Value of Document Indices With over six million documents already produced in the past tobacco litigation to date, and a goal of obtaining the production of even more, the Minnesota attorneys were at grave risk of drowning in a sea of paper.
For each new batch of documents produced, new insight was gained into the defendants' knowledge of cigarette's addictive and dangerous properties. A great amount of the documents produced, however, dealt with the everyday operations of the industry and proved to be repetitive or insignificant. Thus, the Minnesota plaintiffs' trial team focused on obtaining copies of the industry's document indices, which had been created in order to manage the flow of information in "second wave" tobacco litigation such as Cipollone. These indices, created by maintained by the tobacco companies collectively, indexed all smoking and health related documents currently in the industries' collective possession. These indexes would eventually be described by President Clinton as "the industry's road map to its own documents" capable of "improving significantly the ability of public health experts, scientists, state and federal officials, and the public to search through industry documents." The Minnesota plaintiffs realized early on the value of these indices in preparing for trial against the industry. With so many millions of pages of documents under consideration, the plaintiffs were easily able to demonstrate to the trial court "substantial need and inability to obtain the equivalent [of the indices] without undue hardship." With such a showing, the court could grant Minnesota's request, as such a disclosure had been permitted, with the "substantial burden" standard applicable, in other cases of massively voluminous document production.
Such was clearly the case in this tobacco litigation, with more paperwork to be processed than could possibly be achieved by mere mortals. Sorting through these documents was so difficult that the court opined:" If five attorneys were to devote twelve hours each day, five days per week, to the task of reviewing those nine million pages - and limit their review to one minute per page - it would take nine years to review those documents alone. Creation of a new and separate database identifying the nine million documents would be, time-consuming and costly." This decision proved to be a great advantage to plaintiffs' counsel when, after sixteen months, eight orders, and three unsuccessful industry appeals to the Minnesota Court of Appeals, the Minnesota Supreme Court and the United States Supreme Court, the industry produced more than 35 million pages of documents. C. The Battle for Indices Well aware of the document intensive litigation to come, the Minnesota trial court, in its first case management order, made clear that the aforementioned indices would be freely exchanged by the parties "to the extent that each party has an existing index of documents." In a bold move (even for an industry known for bold legal moves) the tobacco defendants claimed that they had no indices responsive to this order. Thus, the court was forced to issue another order, this time ordering each party to produce, "any previously prepared or produced index of documents relative to the subject matter of this action." Anticipating the next stage of this discovery battle, the court qualified this second order, stating that "if the producing party claims an existing index contains subjective information protected by the attorney-client or work product privileges, it shall submit such an index to the court for in camera inspection and determination." The industry's attorneys claimed that any indices were shielded from discovery as attorney work product because the indices were prepared by outside counsel during the second wave of tobacco litigation.
In the hearing relating to this issue, counsel for the defendant RJR Reynolds claimed that the company had spent "90 million" dollars in compiling these indices in response to "litigation demands." Minnesota Rules of Civil Procedure recognize, however, a varying standard in determining if "work product" protection applies. "Ordinary" or " Fact" work product is discoverable, with a showing of substantial need or undue burden, whereas "opinion" work product is generally not discoverable. The industry's claims, however, that the production of these document indices would in someway provide the plaintiff with an unjust insight into their litigation strategy, were not persuasive. An attorney's selection of large numbers of documents for inclusion on an index does not automatically transform the index into opinion work product, as would trigger the elevated level of protection. With such a staggering number of documents involved in a case, the chance that one parties' mental impressions or litigation strategies would be exposed by index production is arguably minimal.
With such a massive pile of paperwork exchanged, one court (in similar circumstances) noted that the documents are "sufficiently voluminous to minimize disclosure of the attorney's identification of some occasional wheat among the chaff." In order to prevent discovery of the indexes, the Minnesota defendants would need to demonstrate a "real, non speculative danger of revealing the lawyer's thoughts" caused by such a production. Within weeks of the second discovery order, the court had reviewed, in camera, samples of the indices, and found that certain portions of the indices were discoverable. The documents did not, in the court's opinion, present any danger of unfairly revealing litigation strategy - and it was clear that the equivalent of the index information could not be reproduced by the plaintiffs without undue hardship. Displeased with the trial court's decision, the tobacco industry tried (and exhausted) every appellate remedy available to effectuate its reversal. The Defendants sought a writ of prohibition from the Minnesota Court of Appeals, which was subsequently denied.
They then sought discretionary review in the Minnesota Supreme Court, which was denied without comment. Some six months later, the industry finally, albeit grudgingly, produced the indices after the United States Supreme Court denied their petition for writ of certiorari. Once these indexes were produced, plaintiffs' counsel found them one of the most important parts of their litigation war chest. The indices allowed the plaintiffs to target their further discovery and prevented the industry from utilizing their past strategy of evading or delaying the vast majority of the discovery process. The documents listed in these indexes, although vague and minimal in their descriptions, would be critical in the next stage of the Minnesota discovery battle: the withholding of actual industry documents on claims of privilege. D.
Specific Document Discovery - Overcoming the Past " From very early on in the [Minnesota] litigation" one state attorney noted, "the industry was placed on notice that its claims of privilege would be closely scrutinized and if necessary, challenged." The industry's past strategies of litigation by discovery abuse had become infamous in legal circles, prompting one legal ethicist to comment that, "The tobacco industry has devised a role for lawyers that is unprofessional, as well as immoral, tortious and criminal. " Detailing more in depth, the industry's attorneys abuse of the discovery process, he continues:" Once an attorney asserts any of these privileges [work product or attorney client] it is very difficult for the opposing party to gain access to the documents in question, even if the assertions were legally baseless and made in total bad faith. Asserted ly privileged documents do not have to be handed over in discovery, even if they were are otherwise responsive to the request. While the party asserting the privilege is normally required to submit a privilege log to facilitate the other party's challenge of assertion, in fact, the process is quite cumbersome and inexact; judges are not eager to go through the documents 'in camera' to determine the validity of the privilege, and most lawyers will not bother to press the issue. Furthermore, it is rare for judges to make a finding that the crime-fraud exception applies. Thus, as a practical matter, thousands of highly incriminating tobacco industry documents have been protected from discovery through improper assertions of the attorney-client privilege and the work product rule." In a critical "second wave" victory, one trial court judge also commented - in detail - on the abuse of discovery process which seems to have occurred in Pre-Minnesota tobacco litigation stating that the documents admitted into evidence, despite the industry's vigorous attempts to exclude on grounds of privilege:" [S]peak for themselves in a voice filled with disdain for the consuming public and its health...
the evidence clearly suggests that the research [conducted by the industry] was not independent and that potentially adverse results were shielded under the caption of 'special projects'; that the attorney-client privilege was intentionally employed to guard against unwanted disclosure [of potentially incriminating documents] and that the promise of full disclosure was never meant to be honored and never was." During the early days of the "third wave" of tobacco litigation, virtually every court that reviewed the industry's asserted ly privileged documents in camera has found that (at a minimum) some portion of the documents are not properly privileged or are subject to disclosure under the crime-fraud exception. In Florida v. American Tobacco Co. the court commented that the tobacco company defendants, "utilized attorneys in carrying out and planning fraudulent activities and undertook to misuse the attorney-client relationship to keep secret research and other activities related to the true health dangers of smoking." In Texas v. American Tobacco Co. another court commented on the industry's attorney / client conduct, stating that "there is prima facie evidence that the services of the tobacco industry lawyers were sought and / or obtained to enable or aid one or more Defendants in committing or planning to commit the crimes, frauds or other misconduct." In yet another third wave case, Burton v.
R. J. Reynolds Tobacco Co. the court ordered production of many of the defendant tobacco company's documents, concluding that the legal arguments proffered by counsel were "clearly contrary to any reasonable application of the attorney-client privilege or work product doctrine." E. The Battle of Minnesota In the Minnesota litigation, as in prior litigation, the tobacco industry lawyers claimed privilege over more than 230, 000 documents, including the vast majority of critical scientific documents on the health hazards of smoking. Pursuant to the case management order in the Minnesota litigation, the parties created privilege logs which provided descriptive information (author, recipients, date, subject & basis for privilege claim) about documents withheld from discovery on grounds of privilege.
Not surprisingly, the tobacco industry submitted privilege logs which were vague and redundant. Defendant RJR, for example, described the detailed subject matter of more than 6, 800 allegedly privileged documents as "scientific research,"smoking and health issues," or "scientists and scientific research." Defendant Brown & Williamson described hundreds of documents only as "confidential communications reflecting legal advice / request for legal advice." This tactic made all of the industry's apparent discovery abuse very difficult to document. Undoubtedly frustrated by this stalling (if not thwarting) the discovery process, the Minnesota plaintiffs argued that when a party asserting privilege provides an "inadequate log" the claimed privilege should be waived. Although the Minnesota court denied this motion, they issued a stern warning to the defendants stating, in part:" [T]he Court is concerned and cautions the parties to provide sufficient information in their privilege logs so that a reasoned decision can be made without in camera review of an unreasonable percentage of documents... The description of certain documents [in defendant's logs] is arguably insufficient for Plaintiffs to reasonably determine whether or not to challenge the claim." The defendants, however, still refused to offer any more information or detail on the nature of their "privileged" documents. F.
Goliath Stumbles - The Liggett Settlement In the Spring of 1997, the State of Minnesota entered into a settlement agreement with the smallest of the cigarette manufacturer defendants, Liggett Group, Inc. One of Minnesota's conditions in the agreement was that Liggett waive all claims of privilege, a move which, to the "Non-Liggett" defendants (as they would be called with increasing frequency) spelled trouble. The non-Liggett industry defendants objected to the production of approximately 2, 400 of the Liggett privileged documents, claiming that they were subject to a joint defense privilege which could not be unilaterally waived by Liggett and required "the consent of all parties to the defense." The trial court directed the parties to file memoranda of law in support of or in opposition to claims of privilege and joint defense. The court also directed the defendants to submit "such motions and affidavits as may be necessary to support any claims of privilege" over the Liggett documents.
A "war of paper" ensued, with extensive briefs, affidavits, and exhibits filed by both sides. Additionally, two days of hearings on privilege and application of the crime-fraud exception were conducted by the trial court on April 8 and 15, 1997. During these hearings the plaintiffs primarily argued that only legal advice, not scientific information can be subjected to the attorney-client privilege, and that simply transferring scientific information to an attorney does not effectively transform that information into privileged communication. The plaintiffs further argued that characterization of certain research scientists as "litigation consultants" since the fruits of their labor would predictably be relevant to future litigation against the industry, did not shield their data from discovery.
The tobacco industry defendants' arguments, although they produced a great deal of paperwork, boiled down to a strict-constructionist view of the work product rule, claiming that all "confidential communication" between an attorney and client is essentially privileged. After both sides arguments were presented and considered, the Minnesota court handed down two discovery decisions which would become famous (or infamous) in the global legal community. V. Harsh Judgment in Minnesota - Crime Fraud and Categorical Document Review. The Process On May 9, 1997 the trial court issued a detailed thirty-one page order setting forth the boundaries of the attorney-client and work product doctrine, as would be applicable in the Minnesota case. The trial court also set forth, within this order, that otherwise properly privileged documents would be discoverable upon a proper showing of crime-fraud:" The purpose of the crime-fraud exception to documents otherwise protected by the attorney-client privilege is to 'ensure that the seal of secrecy' between lawyer and client does not extend to communications from the lawyer to the client made by the lawyer for the purpose of giving advice for the commission of a fraud or crime...
This is exactly what the Plaintiffs argue - that counsel for the tobacco industry advised the industry to conceal documents and research harmful to the industry by depositing the documents with counsel, by routing correspondence through the industry counsel, by naming damning research projects 'special projects' purportedly ordered by counsel, etc. , to cover potentially dangerous materials under a blanket of attorney-client privilege protection, and Plaintiffs wish to tear this blanket away." In what could not be characterized as anything but a crushing defeat for the tobacco lawyers, the trial court concluded that Minnesota had proved a prima facie case of crime-fraud against the industry, offering countless examples of how the attorney-client relationship had been abused. The court also condemned the industry's use of privilege to withhold unfavorable scientific research from the public, stating:" This Court does not believe that the Defendants should be permitted to use, in its advertising and public relations campaigns, health related research which supports their economic interests, and to claim privilege for research which may lead to the opposite conclusion." In addition to the crime-fraud holding, the court adopted a privilege determination procedure which was, arguably, favorable to the plaintiff's interests. It was at this stage of the litigation that the industry's decision to dump such a staggering number of documents in their privilege logs, in spite of the court's warnings to be prudent in such claims, came back to haunt them. In light of the unparalleled number of privilege claims and the prima facie crime-fraud findings, the court concluded that privilege determinations would be made on a category-basis, thus eliminating document-by-document review. The court justified this predictably controversial decision by calculating that, using traditional methods of privilege determination, it would take roughly 6.
25 years of a "one lawyer's working career" to give even a cursory examination (less than 5 minutes) of each document claimed privileged. Thus, the court opined, it was necessary to create a more efficient procedure by which groups of documents could be examined and dealt with, while preserving due process. Despite the an order that it do so, the industry refused to propose subject-matter categories for their own documents to the trial court. The logic behind this strategy remains a mystery, since the industry-defendants were in the best position possible to create categories advantageous to their own desired discovery outcomes.
As a result of the defendants's i lence, the trial court adopted twelve categories of documents, as proposed by the plaintiffs. B. The Controversy This method of categorical document review has been heralded by some as a wise and innovative streamlining of the discovery process in some forms of mass-tort litigation, and others as a severe and unjust infringement on due process rights. Critics of this form of review claim that this kind of "radical incursion on privilege law" destroys the fundamental protections of attorney-client privilege and may lead to unparalleled chaos in the civil legal arena. One group of tobacco attorneys, writing in a journal primarily aimed at defense lawyers specifically address the Minnesota litigation, calling the categorical document review process "grossly inadequate" and detailing the Minnesota process of review (from their perspective) as follows:" The special master accepted evidentiary submission from both parties in camera and ex parte where necessary to protect privileges.
The 10 defendants were allotted only four hearing days to present their complete defense. They faced the daunting task of educating the court about the varied nature of documents within each category, providing background information on corporate and joint defense activities reflected in the documents, rebutting crime-fraud allegations relating to various of the categories, and providing evidentiary support for privilege claims for the 800 sample documents. After the defendants had presented their joint defense rebuttal to the plaintiff's allegations with respect to the categories in general, each defendant was left with no more than three hours to rebut crime-fraud allegations and present evidence in support of privilege claims as to the specific documents under review. This left Philip Morris Inc. , for example, with approximately three hours to present evidence and testimony on 175 sample documents. Under these circumstances, where the documents spanned more than 40 years and were written by dozens of different people, it was impossible as a practical matter, to present live witnesses." Despite the apocalyptic predictions of the industry attorneys, however, American civil jurisprudence seems to have survived the Minnesota judgment, with several other courts, since that time, finding that a document-by-document adjudication of privilege claims is not always required.
C. The Outcome On the evening before trial, the industry requested its first appellate review of the category procedures set by the trial court. The Minnesota Court of Appeals held that the challenge was "untimely." The Court also held that the industry was unable to demonstrate that the alternative privilege-determining procedures proposed by the industry (including forcing the plaintiffs to make a more focused discovery request and / or providing significantly more time to the discovery process) were "unlikely to have yielded any better protection." The Minnesota Supreme Court later denied the industry's petition for discretionary review of the court of appeal's decision. After the review process was completed, on December 16, 1997 the trial court determined, pursuant to the special master's recommendation, and as sanctions for the abuse-of-process they witnessed by the industry and their counsel, that 834 Liggett documents were not privileged in the first instance or, even if privileged, were discoverable under the crime-fraud exception.
The court also offered a stern rebuke of the industry lawyers, concluding that they had abused the privilege process and that "reckless or willful disregard" of court orders was evident. The court asked, albeit rhetorically, if the industry had claimed privilege over clearly non-privileged material "simply to create more of a 'haystack' in which to hide their 'needles'." VI. The Rules of Engagement - Sanctionable Behavior in the Minnesota Litigation Principles of professional ethics provide that a lawyer has an obligation to zealously represent his or her client. This duty, like any other professional standard, has defined or at least reasonably discern able limits. The duty to represent one's client competently and effectively does not give lawyers free reign to harass another person, violate his or her legal rights, or, in the context of the adversarial process, use means which serve no substantial purpose but to embarrass, delay or burden a third person. Did the defense attorneys in the Minnesota tobacco litigation engage in "zealous advocacy" or sanctionable abuse of the discovery process? A.
Model Rule 3. 1 - Meritorious Claims and Contentions Model Rule 3. 1 of the American Bar Association Rules of Professional Conduct provides:" A lawyer shall not bring or defend a proceeding, or assert or controvert an issue therein, unless there is a basis for doing so that is not frivolous, which includes a good faith argument for an extension, modification or reversal of existing law." An action taken for a client is not frivolous merely because the facts have not first been fully substantiated or because the lawyer expects to develop vital evidence through discovery. The action is frivolous, however, if the action is taken primarily for the purpose of harassing or maliciously injuring a person or if the lawyer is unable to make a good faith argument on the merits of the action taken.
Did the Minnesota defendant's claims of privilege meet this standard? Although, as advocates we are reluctant to say an argument is "so weak" that one should be prohibited from even making it, can any line be drawn, or is "all fair" in love, war and jurisprudence. B. Model Rule 3. 2 - Expediting Litigation The official comment to Rule 3.
2 observes the following: "[d]ila tory practices bring the administration of justice into disrepute. Delay should not be indulged merely for the convenience of the advocates, or for the purpose of frustrating an opposing party's attempt to obtain rightful redress or repose." In at least one relatively recent case, sanctions were upheld on counsel for failure to respond to correspondence regarding discovery requests and trial date, failure to follow court's order mandating compliance with discovery requests, on the grounds that same constituted a "clear violation" of Rule 3. 2. In a defamation action brought by Philip Morris Company against the American Broadcast Company, lawyers for ABC alleged that Philip Morris had produced twenty-five boxes containing approximately one million documents. These were the "critically sensitive flavoring documents" relating to ABC's charge that Philip Morris had manipulated and "spiked" its cigarettes with nicotine. To the shock of ABC's attorneys, these documents had been transferred onto a special dark red paper with squiggly lines, which made them "hard to read" and have off noxious fumes that made it "difficult to work with the altered copies for extended periods of time.
C. Sanctionable Discovery Practices - ABA Standards & Model Rule 3. 4 (d) In May of 1999, the ABA Section of Litigation submitted a set of Standards to be approved by the association which are intend as guidance to parties, counsel and the court in civil discovery. The Standards stated intentions were to (i) eliminate unnecessary effort and expense, (ii) restrict the opportunities for misusing the discovery process, both offensively and defensively, and (iii) where possible, to encourage a cooperative rather than adversarial approach to discovery. Although the propriety of seeking a "non-adversarial" approach to "adversarial" aspects of the "adversarial" system is questionable, the Section undoubtedly was reacting, at least in part, to the impact of "scorched earth" style tactics in civil litigation. One cannot help but wonder, if these guidelines were approved and in place at the time of the Minnesota litigation, how anyone could (without audibly laughing) attempted to characterize some of defense counsel's actions as fitting the following standards:" a.
A party should weigh in each case which discovery methods will achieve the discovery goals of (i) obtaining usable information and (b) obtaining it as efficiently and inexpensively as possible for everyone concerned. "b. A party responding to a discovery request should see that the response (i) fairly meets and complies with the discovery request and (ii) does not impose unnecessary burdens or expense on the requesting party." Similar to the duty under Rule 3. 1 regarding meritorious claims and contentions, Model Rule 3.
4 (d) declares it improper to "make a frivolous discovery request or fail to make reasonably diligent effort to comply with a legally proper discovery request by an opposing party." Rule 3. 4 declares as sanctionable, failure to use reasonably diligent effort to comply with a legally proper discovery request. A lawyer's conduct during discovery can also provided basis for finding that the lawyer obstructed access to evidence in violation of Rule 3. 4 (a). In In re Dwight (supra) and Mississippi Bar v. Land, a lawyer was suspended for framing his discovery responses so as to withhold potentially significant facts and evidence in his possession.
Is this behavior not also a reasonable characterization of the discovery responses provided by the Minnesota defendants? Generally procedural rules provide for such wide ranging and extensive discovery that few requests can be properly termed "frivolous." On those occasions when improper discovery conduct is found, the penalties imposed can be harsh. In Castillo v. St. Paul Fire & Marine Ins.
Co. , improper discovery practices led to one attorneys suspension from practice. An attorney may, to a limited extent, be held liable for a client's failure to comply with a document discovery demand. In determining what constitutes "discovery abuse" for the purposes of professional sanctions, courts do draw a distinction between the acts of the client and those of the lawyer. Care must be taken, however, to prevent giving lawyers the catch all excuse that he or she was told, by the client, that "no responsive documents exist" to a particular demand. Sanctions under 3.
4 are generally only invoked when there is a clear showing that the failure to make discovery was "principally" at the instigation of counsel. This is a high burden, and as a result, sanctions have generally only been imposed against counsel only when there is a clear showing that their behavior creates in them a "high degree of culpability." This seems an extremely challenging line to draw. Further, the rule significantly favors the intellect / ingenuity of the client and giving little credence to the role and intellect of counsel. To put it in the context of the Minnesota litigation, Judge Fitzpatrick ordered, on May 8, 1997 that the companies identify and produce documents concerning their smoking and health research and their advertising and marketing / promotion practices. The next month, the judge found that the companies had willfully refused to comply with the order, and scheduled a hearing to assess them with sanctions. Before the sanctions hearing, however, B&W and American filed petitions for review and for a writ of mandamus, plus an interlocutory appeal with the state Court of Appeals.
The appeals court denied the petition in July, and the state Supreme Court on Nov. 13 rejected their petitions for further appellate review. A lawyers non-compliance with discovery requests may eventually lead to a trial court order mandating that the lawyer produce the requested information or documents. If the lawyer still refuses to produce, after such an order, he or she may be found not only in violation of Rule 3. 4 (d) pertaining to discovery abuse, but also Rule 3.
4 (c) which pertains to knowing disobedience of court orders. On December 30, 1997 Judge Fitzpatrick slapped American and B&W with $100, 000 in fines and threatened further fines and a possible default judgment for their willful refusal to produce documents. In the scathing language supporting the order, the Judge stated that the companies had "blatantly disobeyed" his order and "impugned" the integrity of the judicial system by frivolous appeals from the order. Are we to deduce, from the substance of Judge Fitzpatrick's Order that the executives and / or board of B&W and American were the minds behind these actions, and not acting directly on the advice of counsel? Are we to believe that the executives these two corporate defendants were personally determining the selected responses to discovery demands? One might argue "how can we prove that they were acting upon the advice of counsel" but one might reply "how can we prove they were not?" In a matter where millions of dollars were being spent yearly on what have been characterized by at least one plaintiff's lawyer as "the best attorney's money can buy" are we to assume that the companies were not acting upon the advice of counsel? The counsel who had been quarterbacking every step until now? The counsel who - documents later revealed had near controlled even the research activities of the companies? D. Et Tu Brute? - Sanctionable Behavior by the Minnesota Plaintiffs. Model Code DR 1-102 (A) (4) clearly states: "A lawyer shall not...
engage in conduct involving dishonesty, fraud, deceit or misrepresentation." A lawyer would not be permitted to take advantage of a chance to review confidential notes or material inadvertently left in a conference room during a break in a deposition, or accidentally left in a briefcase in opposing counsel's office. How would the information obtained through the Wig and confidentiality leaks, or the William's smuggled documents fit into this view of arguably improper document production? One might argue that these documents were not "inadvertently" provided to counsel, but were intentionally provided by a third (and arguably "disinterested") party. However, ABA Opinion 940382 extends the aforementioned principles even further stating that a lawyer "should not utilize information intentionally provided to him if the lawyer knows the information is privileged or confidential, at least prior to a judicial resolution of the proper disposition of the material." VII. Conclusion The Minnesota tobacco litigation provided new insight into the legal "inner workings" of the largest tobacco companies. The failure of the Minnesota bar to seek sanctions for the tactics of both plaintiff and defense counsel on raised questions as to where the bounds "zealous advocacy" are properly drawn. In sum, the battle for Minnesota undoubtedly added the next chapter in the long history of tobacco lawsuits, paving the way for the Florida judgment, and opening the door for the "fourth wave" of tobacco litigation..