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United States v. United Shoe Machinery Corporation, (1950) 89 F.Supp. 357

Title
United States v. United Shoe Machinery Corporation, (1950) 89 F.Supp. 357
Table of Contents
Content

United States v. United Shoe Machinery Corporation

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359

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l. The first group of documents consist chiefly of letters to or from members of independent law partnerships.

These communications were all made at a time when each of the law partnerships was counsel for United, its subsidiaries and affiliates. The members of the law partnership in each case were acting as attorneys giving legal advice. They were not acting as business advisers or officers of United, even though occasionally their recommendations had in addition to legal points some economic or policy or public relations aspect and hence were not unmixed opinions of law. The modern lawyer almost invariably advises his client upon not only what is permissible but also what is desirable. And it is in the time public interest that the lawyer should regard himself as more than predicter of legal consequences. His duty to society as well as to his client involves many relevant social, economic, political and philosophical considerations. And the privilege of nondisclosure is not lost merely because relevant nonlegal considerations are expressly stated in a communication which also includes legal advice. It follows that in so far as these letters to or from independent lawyers were prepared to solicit or give an opinion on law or legal services, such parts of them are privileged as contain, or have opinions based on, information furnished by an officer or employee of the defendant in confidence and without the presence of third persons. Cf. Tutson v. Holland. 60 App. D.C. l88, 50 F.2d 338.

However, in so far as the subject of these communications was the giving of legal or other advice upon the basis of facts disclosed to the attorney by a person outside the organization of defendant and its affiliates the communication is not privileged. Thus, for example, there is no privilege for so much of a lawyer's letter, report or opinion as relates to a fact gleaned from a witness, Hickman v. Taylor, 329 U.S. 495. 508, 67 S.Ct, 385, 91 L.Ed. 451, affirming D.C., 4 F.R.D. 479, 482; see Wigmore, Evidence, 3d 3d., § 2317; or a person with whom defendant has business relations, General Electric Co. v. Jonathan Clark & Sons Co., C.C.W.D.N.Y., 108 F. 170. In re Ruos, D.C.E.D. Pa., 159 F. 252; or a public document such as a patent, cf. Edison Electric L. Co. v. United States Electric L. Co., C.C.S.D.N.Y.. 44 F. 294; or a judicial opinion, Aaron v. United States. 8 Cir.. 155 F. 833.

Where a communication neither invited nor expressed any legal opinion whatsoever, but involved the mere soliciting or giving of business advice, it is not privileged.360United States v. Vehicular Parking. C. Del., 52 F.Supp. 751.

2. The second group of communications are to or from the resident general counsel of United and his juniors.

On the record as it now stands, the apparent factual differences between these house counsel and outside counsel are that the former are paid annual salaries, occupy offices in the corporation's buildings, and are employees rather than independent contractors. These are not sufficient differences to distinguish the two types of counsel for purposes of the attorney-client privilege. And this is apparent when attention is paid to the realities of modern corporate law practice. The type of service performed by house counsel is substantially like that performed by many members of the large urban law firms. The distinction is chiefly that the house counsel gives advice to one regular client, the outside counsel to several regular clients.

It follows that United's general counsel and his clerks constitute for purposes of the privilege attorneys. However, no doubt a high percentage of the communications passing to or from them fall outside the privilege because they report or comment on information coming from persons outside the corporation or from public documents, or are summaries of conferences held with or in the presence of outsiders.

Referring Principles
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