Out of Circuit, But Worth a Read

In re: Kellogg Brown & Root | 14-5055
U.S. Court of Appeals for the D.C. Circuit

August 2014

While we like to focus on Seventh Circuit cases, the influential U.S. Court of Appeals for the D.C. Circuit issued an extremely important ruling on the scope of attorney-client privilege in the context of internal investigations. In re: Kellogg Brown & Root, No. 14-5055, the D.C. Circuit reaffirmed that confidential statements made during the course of an internal investigation are privileged. The district court had found to the contrary – holding that the purpose of the internal investigation was beyond obtaining legal advice, and included more general business concerns (e.g. regulatory law requirements and business policy). Most disconcerting, the district court employed a “but-for” test – KBR could not show that the statements would not have been made “but-for” a desire to obtain legal advice. The DC Circuit found the “but-for” test “not appropriate for attorney-client privilege analysis.” The Court went on to identify other aspects and practices employed by KBR during its internal investigation that supported the privileged nature of the statements gathered. This case is instructive and a good reminder of best practices to be used during an internal investigation to help maintain the attorney-client privilege.