Court’s In Camera Privilege Review Found Only 491 Documents Privileged, of 30,000 Claimed; Fifth Circuit Finds Review Process Inadequate and Orders Re-Examination of 2,000 Documents

Vioxx Prods. Liab. Litig. Steering Comm. v. Merck & Co., Inc., 2006 WL 1726675 (5th Cir. May 26, 2006)

Merck Company, Inc. (“Merck”) sought interlocutory appeal and a writ of mandamus in response to the district court’s ruling on Merck’s attorney-client privilege claim as to certain documents sought in connection with Vioxx Products Liability multi-district litigation (“MDL”). Timely resolution of the privilege claim was deemed crucial to many of the thousands of cases included in the MDL. Although the Fifth Circuit found that it did not have appellate jurisdiction, it did order the re-examination of documents.

Merck apparently produced more than 2,000,000 responsive documents, claiming privilege for about 30,000. Plaintiffs challenged the claim of privilege and suggested in camera review of samples of documents from each of several categories. The court ordered Merck to divide the documents into agreed-upon categories so that the court could “examine ‘random samples from each category’ and render an order as to Merck’s claim of privilege.” The judge upheld the privilege claim for only about 491 documents. Merck filed a motion for reconsideration, asserting that the court began a document-by-document review instead of using random selections from categories and applying designations to entire categories. Merck further explained that it had not provided additional contextual information because it was uncertain of the process that the court intended to use and it was ready to provide such information as necessary. The court denied this motion, and refused to stay its discovery order:

In sum, the judge described his frustration in reviewing the documents, with a privilege log of a thousand pages in length and eighty boxes of documents. The district court did not rule on the claimed inadequacy of Merck’s privilege log. He explained that for many documents Merck failed to maintain adequate entries in the privilege log, that the attempt to use categories of documents proved impracticable, and that he commenced his seriatim examination. Consequently, after examining approximately 30,000 documents, the district court upheld the privilege claim for approximately 491 documents. It did not request any additional assistance from Merck.

The Fifth Circuit found fault with the process undertaken by the lower court:

The district judge undertook the Herculean task of personally reviewing 30,000 documents over a two-week period. Unfortunately, this effort produced over 200 documents in which it reached inconsistent determinations, concluding that one copy of a document was privileged and that exact duplicates of the same document were not. Despite the commendable effort of this able district judge, we must conclude that the process that has evolved in the litigation has proved to be inadequate and to continue on this course would be an abuse of discretion.

(Footnote omitted.) However, the appellate court rejected plaintiff’s argument that the privilege log was inadequate and any claim of attorney-client privilege had been waived. Instead, it accepted a version of Merck’s proposal whereby Merck would designate 2,000 documents for further examination by the lower court judge:

The district court must be provided the assistance it should have had all along – the opportunity to review documents against the log as supplemented on its request, whether each document is examined or the examination is a random sampling from the universe of 2000. 

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Plaintiffs have the benefit of an in camera examination and Merck should have the opportunity to support its claim of privilege when it is necessary to do so. And the court must be given the support it needs. Merck, as we understand it, will place personnel at hand to answer questions of Judge Fallon or his designee and provide such assistance as he may need, including arranging the documents in ways that will ease the burden of review with or without such randomization as the trial court may order. This supplementation will include written filings if requested. Because this process is by necessity ex parte, all oral communications must be recorded by a court reporter at Merck’s expense, with all transcripts and written submissions filed under seal, a necessary discipline to the process. Merck’s proposal is a sound solution and must be pursued. We accept that all parties will tack to this course. We decline today to issue any writ or attempt any further ruling.

(Footnotes omitted.)