In Mohawk Industries, Inc. v. Carpenter, the Supreme Court resolved a circuit split and held that an order requiring the disclosure of documents arguably protected by the attorney-client privilege does not qualify for immediate appeal under the “collateral order doctrine.” The collateral order doctrine allows litigants to appeal a small class of orders that (1) conclusively determine a disputed question; (2) resolve an important issue completely separate from the merits of the action; and (3) are effectively unreviewable on appeal from a final judgment. Orders that do not fit within these parameters can be challenged only after a final judgment is rendered in the case or by other procedural means.
Mohawk stemmed from a lawsuit filed by Norman Carpenter, who alleged that Mohawk unlawfully terminated him after he complained to the company’s human resources department that the company was employing undocumented workers. When Mr. Carpenter submitted his complaint, Mohawk was defending a class-action racketeering lawsuit, which alleged that the company had conspired to drive down the wages of its legal employees by knowingly hiring undocumented workers. When the company received Mr. Carpenter’s complaint, it directed him to meet with its outside counsel in the racketeering action. According to Mr. Carpenter, during this meeting, outside counsel pressured him to recant his statements. When he refused to do so, the company terminated him.
The class-action plaintiffs sought an evidentiary hearing in their case to explore Mr. Carpenter’s allegations. Mohawk responded to this motion, in relevant part, by asserting that Mr. Carpenter had been interviewed by outside counsel, and his allegations were not substantiated. Mr. Carpenter filed a motion in his own case seeking to compel Mohawk to produce information concerning his meeting with outside counsel and the decision to terminate his employment. Mohawk contended that the information Mr. Carpenter sought was protected from disclosure by the attorney-client privilege. The district court agreed but concluded that Mohawk had waived the privilege through its representations in the class-action lawsuit. The court stayed its ruling, however, pending an appeal by Mohawk.
Mohawk filed a notice of appeal and a petition for a writ of mandamus in the Eleventh Circuit. The Eleventh Circuit dismissed Mohawk’s appeal for lack of jurisdiction concluding that since the district court’s order could be addressed adequately on appeal from a final judgment, it was not an immediately appealable collateral order. The court also denied Mohawk’s mandamus petition finding “‘no clear usurpation of power or abuse of discretion’” by the district court.
The Supreme Court affirmed. Noting that “the decisive consideration is whether delaying review until the entry of final judgment ‘would imperil a substantial public interest’ or ‘some particular value of a high order . . . ,’” the Court concluded that while immediate appeal of disclosure orders implicating the attorney-client privilege posed little risk of harm to litigants, the “likely institutional costs” and potential burden such appeals could place on appellate courts.
Other considerations also guided the Court’s decision. First, the Court noted that appellate courts can vacate judgments and remand cases for new trial that exclude the privileged information and its fruit. Second, because counsel and client “must account for the possibility that they will later be required by law to disclose their communications for a variety of reasons . . . ,” there was little risk that requiring litigants to wait until a final judgment issued in a case would “chill” frank discussions between counsel and clients. Third, litigants “confronted with a particularly injurious or novel privilege ruling” have a variety of options available. They can ask the district court to certify and the appellate court to accept an interlocutory appeal; follow Mohawk’s unsuccessful route and petition the courts of appeal for a writ of mandamus; ignore the disclosure order, risk sanctions and obtain post-judgment review of the sanction order; and ignore the disclosure order and risk a contempt order, which can be appealed directly. Fourth, the Court noted that its holding was supported by recent legislation “designating rulemaking, ‘not expansion by court decision,’ as the preferred means for determining whether and when prejudgment orders should be immediately appealable.” The Court reasoned that because the rule making process draws on the “collective experience of the bench and bar,” expansion of the avenues of appeal for disclosure rulings involving the attorney-client privilege must be undertaken through this process.