Legal Tech: The Attorney-Client Privilege Purpose Requirement and E-Discovery

In considering whether the attorney-client privilege attached to the disputed dual-purpose communications, the district court applied the "primary purpose" test. The district court held that the attorney-client privilege did not protect a subset of documents whose predominate purpose was the procedural aspects of tax return preparation and not tax legal advice. The district court acknowledged the "significant purpose" test adopted by the U.S. Court of Appeals for the D.C. Circuit in In re Kellogg Brown & Root, an opinion written by then-Judge Brett Kavanaugh, holding that the attorney-client privilege applies if "solicitation of legal advice was one of the material purposes of the communication." But the district court rejected that standard, holding that "the relevant consideration is whether the primary or predominate purpose of the communication was to seek legal advice or to provide the corresponding legal advice."

The district court held the company and the law firm in contempt, and the parties filed an appeal. The Ninth Circuit upheld the contempt orders, rejecting the arguments that the documents were subject to the attorney-client privilege because obtaining legal advice was a significant purpose of the communications. The court held that "the primary purpose test applies to attorney-client privilege claims for dual-purpose communications."