Posted by Ellyce Cooper and Patrick Kennell
The ongoing saga regarding privilege and work product issues continues in United States ex rel. Barko v. Halliburton Co., No. 05-cv-1276 (D.D.C. 2005). (Our previous blog posts on the case can be found here, here, and here.) As we previously reported, in June of 2014, the D.C. Circuit ordered the lower court to reconsider its order that Halliburton turn over to the relator the results of an internal investigation. The D.C. Circuit held that “[s]o long as obtaining or providing legal advice was one of the significant purposes of the internal investigation, the attorney-client privilege applies, even if there were also other purposes for the investigation.” In re Kellogg Brown & Root, Inc., 756 F.3d 754 (D.C. Cir. 2014) (emphasis added). However, the court directed the District Court to examine the other reasons advanced by the relator as to why the documents at issue were “not covered by either the attorney-client privilege or the work product doctrine.” Id. at 764.
On November 20, 2014, the District Court found that Kellogg Brown & Root (“KBR”) had waived attorney-client privilege and work product protection over documents because, the court concluded, KBR had put the contents of certain documents at issue in the litigation by: (1) questioning its own 30(b)(6) witness about the results of the investigation at deposition and then using that portion of the deposition as part of a subsequent summary judgment motion and (2) allowing the defendant’s 30(b)(6) witness to review the allegedly privileged documents prior to his deposition testimony. United States ex rel. Barko v. Halliburton Co., No. 1:05-CV-1276 (D.D.C. Nov. 20, 2014). With regard to the use of deposition testimony by KBR on summary judgment, the Court found that disclosure of the investigation documents was appropriate because the defendant “had, in effect, revealed the substantive conclusion of its  investigations and referred to this finding on multiple occasions. Barko is certainly prejudiced by this conduct: [Defendant] lays out an inference in favor based on evidence that it forbids Barko from examining.” Id. at *33.
The Court also found waiver as a result of the 30(b)(6) witness’s review of the documents at issue prior to deposition pursuant to Rule 612 of the Federal Rules of Evidence, which states that “if the court decides that justice requires . . . an adverse party is entitled to have the writing produced . . . [and] to cross-examine the witness about it, and to introduce in evidence any portion that relates to the witness’s testimony.” The Court noted that “[i]n most cases, Rule 30(b)(6) witnesses who have examined privileged materials before testifying will not waive the privilege.” Id. at *41. However, in this case, the Court applied a balancing test and found that “fairness considerations support disclosure” because the witness reviewed the documents before testifying and the documents contained “almost no attorney opinion materials,” but instead contained “investigator-taken statements and investigator reports.” Id. One of the key factors cited by the Court was that the witness’s testimony contradicted the documents reviewed and that the 30(b)(6) witness had to rely on the documents because “he had no personal, firsthand knowledge of whether fraud or kickbacks occurred, even though he supervised KBR’s COBC investigations and reporting.” Id. at *40. Defendants have sought an interlocutory appeal of this ruling, and the Court of Appeals has stayed the ruling pending its decision on the mandamus petition. In re Kellogg Brown & Root, Inc., No. 14-5319 (D.C. Cir. Dec. 23, 2014 (Order). Both parties have fully briefed the mandamus petition, and oral argument was held on May 11, 2015. In re Kellogg Brown & Root, Inc., No. 14-5319 (D.C. Cir. Mar. 13, 2015) (Order).
On December 18, 2014, the District Court issued an additional ruling on whether the relator should have access to portions of the documents at issue that include “non-privileged fact work product that is discoverable based on substantial need.” United States ex rel. Barko v. Halliburton Co., No. 1:05-CV-1276, at * 2 (D.D.C. Dec. 17, 2014) (Docket No. 228). The Court found that there was a basis to waive work-product over those portions of the investigative reports that “provide background information meant to assist a lawyer in eventually reaching a conclusion.” Id. at *13. Holding that such sections “are fact, not opinion, work product” Id. the Court found substantial need to waive work product protection – over nine years had passed since the case was first filed and defendant had identified over 200 witnesses who might have information regarding the alleged fraud. Id. at *14-15. The Court found that pursuing such information from such a vast number of people (located around the globe) related to events from so long ago “crosses from necessary diligence to undue hardship.” Id. at *15. One of the key issues cited by the Court was the fact that some of the 30(b)(6) witnesses had no recollection of the events at issue in the case and that KBR’s attorneys had prevented the 30(b)(6) witnesses from answering many questions on privilege grounds, thus necessitating a much more extensive factual investigation than would normally be necessary. Id. at *15-17.
The District Court has since ordered the parties into mediation, and on April 1, 2015, the District Court granted a joint motion to stay the entire case pending the outcome of the mandamus petition discussed in more detail above. We will continue to monitor this matter.