Recent Investigations Highlight Federal Government’s Evolving Approach to Review of Privileged Communications Following Seizure

Where seized information may contain privileged lawyer-client communications, the government has often claimed the right to make unilateral judgment calls about the applicability of legal privileges simply because it possesses the communications. This presents a fundamental conflict of interest because the government has an interest in learning the contents of relevant communications and may want to consider using communications that are arguably inculpatory in support of its case. Despite this clear conflict, the government’s approach has typically been to employ a team of government attorneys uninvolved in the prosecution (sometimes referred to as a “filter team” or “taint team”) to conduct a privilege review and pass along documents they deem non-privileged to the prosecution team.

But what about the alternatives that provide stronger safeguards to prevent privileged information from reaching the prosecution? Why should there be any presumption that the government’s usual approach is appropriate?

Giuliani’s case makes clear that there are options other than having government attorneys conduct the privilege review. In that case, the government proposed a conservative approach—one decidedly outside the norm—by requesting that the court appoint a special master to review the seized information and release only non-privileged materials to the prosecution. Citing the “unusually sensitive privilege issues that the warrants may implicate,” the government sought this step on April 29, the day after the seizure. Gov’t Letter Requesting Appointment of a Special Master, In re Search Warrant dated April 28, 2021, No. 1:21-mc-00425-JPO (S.D.N.Y. May 4, 2021) (characterizing this decision as necessary to preserve the “perception of fairness, not fairness itself”). The court granted the government’s request even as it found that “the filter team process adequately safeguards the attorney-client privilege and the constitutional rights of the search subjects and their clients.”

The government’s approach in this case is a departure from its usual practice as prosecutors have historically resisted requests to take the privilege review out of the government’s hands. For decades, the government has assembled ad hoc taint teams to identify privileged information that should not be shared with the prosecuting attorneys. See U.S. Dep’t. of Justice, Justice Manual § 9-13.420 (2020). The government’s practice in these cases is founded on its belief that personnel with no prosecutorial role in the case (outside of reviewing documents) are adequately separated from the prosecution team such that privileged material will not find its way to the prosecution. Yet this notion of a reliable and disinterested government reviewer has received significant scrutiny over time, with courts directly questioning whether government attorneys can be counted on in this role:

[H]uman nature being what it is, occasionally some taint team attorneys will make mistakes or violate their ethical obligations. It is thus logical to suppose that taint teams pose a serious risk to holders of the privilege, and this supposition is supported by past experience.

In re Grand Jury Subpoenas, 454 F.3d 511, 523 (6th Cir. 2006). More recently, the U.S. Court of Appeals for the Fourth Circuit took these criticisms further, finding that the government’s use of taint teams was tantamount to leaving the “fox in charge of guarding the … henhouse” and characterizing the practice as intruding on a core judicial function. United States of America v. Under Seal, 942 F.3d 159, 177-78 (4th Cir. 2019).

The concern about the government’s ability to prevent privileged materials from going to the prosecution is more than theoretical: Recent cases have illustrated the government’s carelessness in shielding prosecutors from privileged materials, which further supports moving away from taint teams. See, e.g., United States v. Elbaz, 396 F. Supp. 3d 583, 589 (D. Md. 2019) (noting failures by the taint team that led to the prosecution having access to privileged information for a five-month period); United States v. Esformes, No. 16-20549-Cr-Scola/Otazo-Reyes, 2018 WL 5919517 (S.D. Fla. Nov. 13, 2018) (finding significant deficiencies in the prosecution’s protocol for collecting and reviewing seized materials).

Presumably in response to these criticisms and amidst escalating objections from the defense bar, an alternative to taint teams emerged last year with the Department of Justice’s formation of a Special Matters Unit (SMU) for cases arising within the Fraud Section. Like taint teams, the SMU’s attorneys work to identify privileged information recovered from searches and seizures of evidence to ensure that prosecutors do not get access to these materials. But unlike the taint team model, this group is not formed and disbanded on an ad hoc basis. Whereas service on a taint team is brief, intermittent, and mixed with other responsibilities outside the team, the service within the SMU is neither temporary nor confined to a single case. This arrangement to create what amounts to a specialized, dedicated privilege review team arguably allows for greater consistency from case to case, increased efficiency, and a clearer appearance of independence. Yet, although the SMU reflects an evolution toward a more sophisticated approach to safeguarding parties’ privileges, the key problem—that a team of prosecutors lacks independence—is not solved by creation of the SMU.

There are alternatives that achieve greater independence from the prosecution, including a privilege review of the seized materials by counsel to the party from whom they were seized, or a privilege review by a neutral third party such as a magistrate judge or a special master. Review by counsel to the party from whom the materials were seized allows that party to protect its own interests and claim privilege over any documents it deems privileged; any disputes about whether such documents are actually properly withheld can then be resolved by a magistrate judge or a special master. Where the government is resistant to such self-review, review by a magistrate judge is an option, although it may be a poor fit for large-scale review efforts involving electronic discovery, given the significant judicial resources needed for this work. The appointment of a special master, by contrast, is not similarly constrained and allows an independent party to make privilege determinations. Moreover, in certain cases where context is helpful to accurately identify privileged materials, that issue can be addressed through the selection of a special master who has specific knowledge or experience. The use of a special master addresses the primary problem inherent in the government’s review of privileged information: the lack of independence of a prosecution team.

The use of special masters has been most prominent in cases involving the seizure of materials from law offices, particularly those of criminal defense lawyers. See, e.g., United States v. Gallego, No. CR-18-01537-001-TUC-RM (BPV), 2018 WL 4257967 (D. Ariz. Sept. 6, 2018) (finding that a special master should be appointed following seizure of documents from a criminal defense attorney’s office in part because the seized materials could contain privileged materials pertaining to unrelated criminal defendants, raising Sixth Amendment concerns); United States v. Stewart, No. 02 CR. 396 JGK., 2002 WL 1300059, at *4 (S.D.N.Y. June 11, 2002) (appointing a special master where materials seized from the defendant's law office, which was part of a larger suite shared by four other solo practitioners, were “likely to contain privileged materials relating not only to unrelated criminal defendants but also to the clients of attorneys other than the defendant”); United States v. Grant, No. 04 CR 207BSJ, 2004 WL 1171258, at *3 (S.D.N.Y. May 25, 2004) (not appointing a special master where “[t]he seized documents were not in the files of a criminal defense lawyer, and relate to civil, not criminal, litigation that predates the indictment in this case”). However, appointment of a special master is not limited to instances where documents are seized from attorneys. See, e.g., United States v. Castro, No. CR 19-20498, 2020 WL 241112 (E.D. Mich. Jan. 16, 2020) (rejecting proposal to use a taint team to review calls made by the defendants from prison that were likely to contain attorney-client information). The logic of appointing a special master applies equally to seizures from non-lawyer privilege holders that are likely to include substantial privileged communications and should be considered by counsel in such instances. The Justice Manual §9-13.420 identifies seizures of information from “business organizations … involv[ing] materials in the possession of individuals serving in the capacity of legal advisor to the organization” as appropriate for review by a taint team. Such circumstances may likewise justify appointment of a special master.

Ultimately, the seizure of cell phones and computers from Giuliani and the government’s request for a special master serves as a signal for counsel in other cases to seek whatever approach best fits the circumstances and allows for sufficient independence and adequate protection of the client’s rights. Giuliani’s case emphasizes that options are available to parties whose privileged communications have been seized, and counsel should vigorously explore such options. Moreover, it should be noted that counsel should promptly raise any arguments pertaining to the treatment of privileged communications, including arguments seeking appointment of a special master. See, e.g., United States v. Feng Ling Liu, No. 12 CR. 934(RA), 2014 WL 101672, at *12 (S.D.N.Y. Jan. 10, 2014) (finding that defendant waived any objection to the use of an FBI filter agent because “she waited to object until well after the government had begun its review and thus had allegedly committed the ‘irreparable’ breach of privilege”). When such seizures occur, counsel should at a minimum consider whether it makes sense to challenge the review by a taint team and to propose alternatives, whether appointment of a special master, a self-review of the documents, an ex parte review by the judge, or some other combination of these options. Additionally, a motion under Rule 41, requiring return of all privileged materials, should be considered as yet another remedy, and injunctive relief may be available in extraordinary cases.

Giuliani’s circumstances are certainly unusual, but the need to safeguard privileged communications is universal. In all cases, alternatives to the government’s taking control of a privilege review should be evaluated carefully, particularly given that its interests are inevitably in conflict with those of the subjects of an investigation.