IN RE APPLE INC. SECURITIES LITIGATION

Background

This discovery order addressed two related attorney-client privilege disputes in the securities litigation. First, the plaintiff asked the court to require Apple to re-review documents that Apple had withheld as privileged. Second, the parties had narrowed their remaining dispute to 55 documents covered by an earlier discovery order.

Apple originally reviewed 1,630 documents under a test asking whether seeking legal advice was “a primary purpose” of a communication. The court explained that Ninth Circuit law instead applies “the primary-purpose test” to communications with both legal and business purposes. Apple had represented during earlier proceedings that it used that test, but later clarified that it had used the broader standard. The court had previously limited the dispute to 232 documents, but the district judge returned the re-review issue to Magistrate Judge Spero for further consideration under Federal Rule of Civil Procedure 26(e).

Rule 26(e) re-review requirement

Rule 26(e) requires a party to timely supplement or correct a discovery response when it learns that the response is materially incomplete or incorrect. The court rejected Apple’s argument that the rule required actual knowledge that a specific privilege determination was wrong before Apple had to re-review the documents. The court held that Apple had to conduct a review using the correct legal standard once it became clear that its original privilege review used a standard not adopted by the Ninth Circuit.

The court also rejected Apple’s argument that the parties’ agreement narrowing the dispute excused further review. The court found that the agreement was based at least in part on the plaintiff’s misunderstanding of the standard Apple had applied. Enforcing the agreement would therefore be unfair, except for documents the plaintiff had agreed to remove from the dispute for reasons unrelated to privilege. The parties also agreed at the hearing to exclude documents created before September 15, 2018, or after January 30, 2019.

Review of the 55 disputed documents

The court conducted an in-camera review, meaning a private review by the judge, of 26 documents that the parties identified as sufficient to resolve the privilege status of all 55 disputed documents.

For Entry Nos. 285 and 286, the court found that some messages were nonprivileged and ordered Apple to produce redacted versions. The court explained that generic requests for business feedback were not privileged merely because in-house counsel was copied, while messages containing legal advice could remain protected.

For the drafts of the Investor Letter, including Entry Nos. 391, 402, 515, 522, 524, 526, 532, 539, 574, 594, and 682, the court generally found that comments and edits by non-attorneys did not appear privileged on the current record. Comments, edits, and related text by in-house counsel Sam Whittington could be redacted when they constituted legal advice. The court ordered production of the remaining material, subject to appropriate redactions and any further supporting declarations required by the order.

The court upheld Apple’s withholding of Entry No. 544 and the redacted portion of Entry No. 583. Based on in-camera review and Whittington’s declaration, the court found that those communications were sent in response to counsel’s requests for factual support for the Investor Letter and reflected the nature of counsel’s legal instructions.

For Entry Nos. 400, 403, 404, 417, 517, 536, 618, 619, 622, 651, 673, and 692, the court made document- and message-specific privilege determinations. It found some communications privileged because they provided or revealed legal advice, while other business communications and messages that did not request or reveal legal advice were not privileged on the current record. For certain messages, Apple was permitted to provide detailed attorney declarations to establish that the communications requested legal advice or would reveal specific legal advice.

Order

By September 11, 2023, Apple was ordered to re-review the documents on its privilege log, excluding the 232 documents addressed in the earlier order, documents listed in the order’s footnote 2, and documents outside the stipulated date range. Apple had to produce documents it found to be nonprivileged, provide a detailed privilege log, and provide supporting declarations of counsel when required.

For the 55 disputed documents, Apple also had to produce the documents or portions the court ordered produced and provide evidence supporting continued withholding of material that the court found nonprivileged on the current record but did not specifically order produced. The parties were then required to meet and confer about any remaining disputes. Magistrate Judge Joseph C. Spero signed the order.