## Facts

- A Minnesota real-estate development partnership pursued a project that faced opposition from local government and competing developers.
- The partnership filed litigation against the city and private parties, asserting antitrust claims later amended to civil RICO claims.
- The partnership worked closely with an independent development consultant who was not a formal employee but was deeply involved in the project and related litigation.
- During discovery, opposing parties sought documents and deposition testimony concerning communications among the partnership, its lawyers, and the consultant.
- The partnership asserted attorney-client privilege and work-product protection over those communications and materials.

## Issues

1. Whether attorney-client privilege can protect confidential communications involving a non-employee consultant when the consultant’s participation is necessary or highly useful to counsel’s provision of legal advice to an organizational client.
2. Whether mandamus is warranted to vacate a discovery order compelling production of allegedly privileged and work-product-protected materials based on the consultant’s non-employee status.

## Decision

- The court granted a writ of mandamus directing the district court to vacate the order compelling discovery and to reconsider the dispute under the correct privilege framework.
- The court held the district court clearly abused its discretion by treating the consultant’s non-employee status as dispositive and compelling disclosure without a proper functional analysis.
- The court recognized that communications involving an independent consultant may fall within the attorney-client privilege where the consultant is the functional equivalent of an employee and is necessary or highly useful to effective attorney-client consultation.
- The court found mandamus appropriate because compelled disclosure of privileged materials would cause irreparable harm that could not be remedied after final judgment.

## Legal Principles

- In federal-question civil litigation, attorney-client privilege is governed by federal common law.
- The attorney-client privilege protects confidential communications made for the purpose of obtaining or providing legal advice.
- For organizational clients, privilege analysis is functional, not limited to formal “control group” or strict employee-only categories; the key inquiry is whether the communicator’s role and information are necessary or highly useful to counsel’s provision of legal services.
- Participation of a non-employee consultant does not automatically defeat privilege when the consultant functions as an insider facilitating legal advice.
- Mandamus may be used to correct a discovery order that compels disclosure of assertedly privileged materials because disclosure destroys confidentiality and cannot be fully cured on appeal.

## Conclusion

The Eighth Circuit held that an organizational client’s attorney-client privilege can extend to communications involving an independent consultant who effectively served as an internal team member for purposes of obtaining legal advice, and it used mandamus to prevent irreversible disclosure caused by an erroneous discovery order.


In re Bieter Co., 16 F.3d 929 (8th Cir. 1994)