THE SUPREME COURT ‘DIGS’ IN RE GRAND JURY: ITS DECISION TO DISMISS THE CASE AND LEAVE ATTORNEY-CLIENT PRIVILEGE IN THE THREE-CIRCUIT BALANCE

By: E. Isabel Park, Volume 107 Staff Member

After the Supreme Court heard oral arguments in In re Grand Jury[1] on January 9, 2023, all that remained was for the Court to decide the case.[2] Instead, two weeks later, the Court dismissed the case as “improvidently granted.” This left unresolved a three-way circuit split on whether attorney-client privilege extends to communications containing an inextricable mix of legal and non-legal advice.[3] This Post examines the Supreme Court’s general ability to dismiss a case as improvidently granted (DIG) and analyzes potential explanations for its decision to dismiss In re Grand Jury specifically, before discussing the legal upshot of that decision with respect to attorney-client privilege.

I. WHAT DOES IT MEAN TO “DIG” A CASE?

In short, the Supreme Court’s dismissal of a case as improvidently granted effectively reinstates the lower court’s order and reflects the Court’s view that it never should have accepted the case.[4] Such dismissals are rare, declining in number, and often issued without explanation.[5] Between 2005 to 2021, the Roberts Court issued just 25 DIGs, averaging 1.62 DIGs per term.[6] During the fifty years preceding that period, the Court had issued 155 DIGs at an average rate of 3.04 DIGs per term.[7] The percentage of DIGs accompanied by an opinion explaining the Court’s decision is decreasing as well.[8]

When the Supreme Court DIGs a case, the implication is that some combination of the record, briefs, and oral argument has convinced the Court at the merits stage that it shouldn’t decide the case for one of several reasons. These reasons can be procedural, substantive, practical, or some combination of them.[9] Sometimes, the Court determines that the issue initially presented on appeal has changed so fundamentally that it’s become an altogether different question, and one that the Court doesn’t want to address.[10] In other cases, oral arguments bring to light new, additional considerations that lead the Court to believe it would be exercising improper jurisdiction in deciding the case.[11] The Court may also resort to issuing a DIG if it is unable to reach a consensus—in which case, deciding the case would merely amount to publishing a “fractured opinion with no controlling rationale.”[12] These are just some of the many reasons the Supreme Court may DIG a case instead of deciding it.[13]

II. THE COURT’S DIG IN IN RE GRAND JURY

In re Grand Jury arose out of a criminal tax investigation into the owner of an unnamed Company and the Law Firm (also unnamed) representing it. Law Firm, which specialized in tax issues, had been advising the owner about the “tax consequences of expatriation.”[14] As part of the investigation, much of which remains a mystery,[15] a grand jury issued subpoenas to Company and Law Firm, both of which refused to turn over certain requested information by asserting the work product doctrine and attorney-client privilege.[16] They claimed that because the primary purpose of the communications and documents was to obtain legal (not tax) advice, the subpoenaed materials were shielded by privilege.[17]

The district court ultimately rejected Company and Law Firm’s assertion of privilege and granted a motion to compel production of the subpoenaed information.[18] It applied the “primary purpose” test, which weighs both legal and non-legal purposes against one another to determine which is the primary (i.e., the more significant) purpose of the communication.[19] Only when the legal purpose is most significant is the communication privileged. When Law Firm and Company failed to comply with its order, the district court held them in contempt.[20] The Ninth Circuit affirmed the district court’s decision after itself engaging in the same primary purpose test.[21] It articulated the test as follows: the “client must consult the lawyer for the purpose of obtaining legal assistance and not predominantly for another purpose.”[22]

Company and Law Firm petitioned the Supreme Court for a writ of certiorari to resolve a three-way circuit split (discussed below) regarding what the appropriate test was for determining whether attorney-client privilege applies to a given document or communication. Instead, two weeks after hearing oral arguments, the Supreme Court issued a one-sentence per curiam opinion: “The writ of certiorari is dismissed as improvidently granted.”[23]

III. THE THREE-WAY CIRCUIT SPLIT THAT THE SUPREME COURT LEFT INTACT

As it currently stands, the D.C., Seventh, and Ninth Circuits are split about how to assess dual-purpose communications. The D.C. Circuit looks solely at whether there is a significant legal purpose behind the communication, disregarding whether there is an equally or more significant non-legal purpose (i.e., not a balancing test).[24] If there is a significant legal purpose, the communication is privileged.[25] Rejecting the D.C. Circuit’s test, the Ninth Circuit opted instead for the narrower primary purpose test.[26] However, this approach has left unanswered the question of what to do when there are equally significant legal and non-legal purposes behind a communication. Further still, the Seventh Circuit takes the most extreme approach, holding that communications with any non-legal purpose, even where the legal purpose of a dual-purpose communication is more significant than any other purpose, are unprivileged.[27]

Although it’s impossible to know exactly why the Court issued a DIG in the In re Grand Jury case, one possibility is that it contained vehicular issues.[28] This is plausible, given that most facts of the underlying investigation are sealed and the possibility that other facets of the case (e.g., cryptocurrency)[29] might have complicated the issues. The facts of In re Grand Jury may also have been such that the Court’s decision wouldn’t fully resolve the circuit split—for example, if the Court believed that the legal purpose behind the communications in question was not only the most significant, but also the sole purpose. Others speculate that the Supreme Court DIGed In re Grand Jury because the various tests have not yet proved unworkable (or at least sufficiently unworkable to warrant the Supreme Court to weigh in on the topic).[30] However, circuit splits inherently encourage forum shopping and give rise to unpredictability.[31] This is particularly concerning for questions of attorney-client privilege because unclear standards for when privilege applies could prolong chilling effects on lawyer-client communications across numerous jurisdictions.[32]

Hopefully, given the high stakes of the issue, a case seeking resolution of the circuit split regarding attorney-client privilege that the Supreme Court deems fit for adjudication through the merits will reach its docket in the near future.

 

[1] In re Grand Jury, 598 U.S. __ (2023) (No. 21-1397).

[2] Amy Howe, Seven Mostly Low-Profile Cases Are Slated for Oral Arguments in January, SCOTUSBlog (Nov. 10, 2022), https://www.scotusblog.com/2022/11/seven-mostly-low-profile-cases-are-slated-for-oral-arguments-in-january [https://perma.cc/CH8H-W3QM].

[3] Petition for a Writ of Certiorari at 2–3, In re Grand Jury, No. 21-1397 (Apr. 1, 2022).

[4] Supreme Court Insight Help Files: Glossary, ProQuest LibGuides (Dec. 12, 2022), https://proquest.libguides.com/supremecourtinsight/glossary [https://perma.cc/VS29-4GDW].

[5] Bryan Gividen, The Roberts Court and DIGs, Above the Law (Mar. 5, 2021), https://abovethelaw.com/2021/03/the-roberts-court-and-digs [https://perma.cc/5B2W-9XB5].

[6] Id.

[7] Id.

[8] Id. (noting that less than a third of the Roberts Court-issued DIGs were accompanied by an opinion).

[9] L. Bradfield Hughes, Can You “DIG” It? The Dismissal of Appeals as Improvidently Granted, Ohio Law. (Sept. 2013), https://www.porterwright.com/content/uploads/2017/11/bhugesohiolawyerfall2013.pdf [https://perma.cc/USA8-W9FC].

[10] Visa Inc. v. Osborn, 575 U.S. __ (2015) (noting that “having persuaded us to grant certiorari on [one] issue, however, petitioners chose to rely on a different argument in their merits briefing”). However, in some cases, the Court has nonetheless moved forward in deciding the case on the issue that was initially raised in the petition for certiorari. See, e.g., Norfolk Southern R. Co. v. Sorrell, 549 U.S. 158 (2007); City of S.F. v. Sheehan, 575 U.S. 600 (2015).

[11] See Kevin Russell, Practice Pointer: Digging into DIGs, SCOTUSBlog (Apr. 25, 2019), https://www.scotusblog.com/2019/04/practice-pointer-digging-into-digs [https://perma.cc/4NBS-7KFS].

[12] Id.

[13] See also Russell, supra note 11; Hughes, supra note 9 (explaining additional strategic and institutional reasons why the Supreme Court might DIG a case).

[14] Petition, supra note 3, at 3.

[15] The investigation may have involved cryptocurrencies. See Brief for the United States at 3, In re Grand Jury, No. 21-1397 (Dec. 16, 2022) (noting the district court’s discussion of how to characterize advice on the “tax treatment of cryptocurrencies”).

[16] Id. at 7.

[17] Id. at 5–6.

[18] Id. at 6. Note that the district court order and opinion are under seal.

[19] Petition, supra note 3, at 9.

[20] Id. at 7.

[21] Id. at 15.

[22] In re Grand Jury, 13 F.4th 710, 715 (9th Cir. 2021) (citations omitted).

[23] Order (per curiam), In re Grand Jury, 598 U.S. __ (2023).

[24] Petition, supra note 3 at 9.

[25] Id.

[26] Petition, supra note 3, at 9; In re Grand Jury, 13 F.4th at 715.

[27] Petition, supra note 3, at 9–10.

[28] See Hughes, supra note 11 (discussing various factors that could make a case “a poor vehicle for resolving the question [the Court] had taken the case to answer”).

[29] See supra note 15.

[30] See Supreme Court Weighs Whether “Dual Purpose” Communications Are Privileged in In re Grand Jury, Crowell (Jan. 11, 2023), https://www.crowell.com/NewsEvents/AlertsNewsletters/All/Supreme-Court-Weighs-Whether-Dual-Purpose-Communications-Are-Privileged-in-In-re-Grand-Jury [https://perma.cc/VAV8-ZHFE].

[31] Id.

[32] Katie Kraft, Booker Shaw, Warren Dean, Jr. & Douglas Lang, Supreme Court to Decide Limits of Attorney Client Privilege: Why the Ninth Circuit Decision Spells Disaster for the Sanctity of Legal Advice, Thompson Coburn LLP (Oct. 26, 2022), https://www.thompsoncoburn.com/insights/publications/item/2022-10-26/supreme-court-to-decide-limits-of-attorney-client-privilege-why-the-ninth-circuit-decision-spells-disaster-for-the-sanctity-of-legal-advice [https://perma.cc/B2NW-B7FD] (citing Mohawk Indus, Inc. v. Carpenter, 558 U.S. 100 (2009); Upjohn Co. v. United States, 449 U.S. 383 (1981)).