The D.C. Circuit Court Steps in and Applies the Proper Privilege Test

The D.C. Circuit Court of Appeals decided that the district court’s “but for” articulation of the “primary purpose” test was the wrong standard to assess whether a communication is privileged. First, the district court’s test “would eliminate the attorney-client privilege for numerous communications that are made for both legal and business purposes.” Second, the test “would eradicate the attorney-client privilege for internal investigations conducted by businesses that are required by law to maintain compliance programs, which is now the case in a significant swath of American industry.”
In its stead, the Court clarified the “significant purpose” test. Under that standard, the key inquiry is: “[w]as obtaining or providing legal advice a primary purpose of the communication, meaning one of the significant purposes of the communication?” Applied to an organization’s internal investigation, the privilege applies if one of the “significant purposes” of the internal investigation was to obtain or provide legal advice. KBR had no issue satisfying that test here and the Court vacated the lower court’s document production order.

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