June 13, 2011

Supreme Court Decides United States v. Jicarilla Apache Nation

On June 13, 2011, the Supreme Court decided United States v. Jicarilla Apache Nation, No. 10-382.

Common law recognizes an exception to the attorney-client privilege that is known as the "fiduciary exception." This exception to the privilege generally applies when a trustee obtains legal advice related to the exercise of its fiduciary duties. In such cases, the trustee cannot withhold attorney-client communications from the beneficiary of the trust, so those communications are discoverable in litigation between the beneficiary and the trustee.

The United States generally holds natural resources located on land occupied by Indian tribes—and the proceeds derived from those resources—in trust for the tribe. In this case, the Jicarilla Apache Nation (the "Tribe") sued the United States, alleging that the United States mismanaged proceeds from natural resources that the United States held in trust for the Tribe. In discovery, the Tribe asked the government to produce various documents that the government claimed were privileged communications with government lawyers. The Tribe argued that because the United States holds assets in trust for Indian tribes, the fiduciary exception to the attorney-client privilege applies to communications between the United States and its lawyers in litigation involving Indian tribes, and that the government had to produce the requested documents. The Court of Federal Claims granted most of the Tribe's motion to compel production of the documents, holding that the fiduciary exception to the attorney-client privilege applied. The Court of Appeals for the Federal Circuit denied the government's petition for a writ of mandamus directing the Court of Federal Claims to vacate its production order, holding that the fiduciary exception applied.

The Supreme Court reversed. The Court first assumed (because neither party disputed) that there is a fiduciary exception to the attorney-client privilege. The Court then discussed the history of the exception, noting that it rests on the premise that when a trustee obtains legal advice to guide the administration of the trust, and not for the trustee's own defense in litigation, the beneficiaries were entitled to the production of documents relating to that advice, because the advice was sought for the beneficiaries' benefit and obtained at the beneficiaries' expense. The Court recognized that the relationship between the United States and Indian tribes is often analogized to a private trust relationship, but the Court held that the relationship does not resemble a private trust relationship in every respect. Significantly, the "trust" relationship between the government and the tribes is defined and governed by statutes, not common law, and the government may call its relations with tribes a "trust" without assuming all of the common-law duties of a private trustee; it may create a "limited" or "bare" trust. Also significant is the fact that the government's relationship with the tribes follows from its position as sovereign, which is subject to Congress's control. The Court concluded that the two features justifying the fiduciary exception—the beneficiary's status as the "real client" and the trustee's common-law duty to disclose information about the trust to the beneficiary—are absent in the relationship between the government and the tribes. The tribes do not pay for the services of government attorneys, and the government seeks advice from its lawyers as a sovereign, not as a representative or fiduciary of the tribes. And the federal statutes that define the trust relationship do not impose any disclosure obligations on the government.

Justice Alito delivered the opinion of the Court, in which Chief Justice Roberts and Justices Scalia, Kennedy, and Thomas joined. Justice Ginsburg filed an opinion concurring in the judgment, in which Justice Breyer joined. Justice Sotomayor filed a dissenting opinion. Justice Kagan did not participate. 

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