An Arkansas federal judge this month rejected Wal-Mart's "conclusory" assertion that an in-house investigation was protected from discovery by the attorney-client privilege and work product doctrine. The case, City of Pontiac General Employees' Retirement System v. Wal-Mart, Inc., is a securities fraud class action brought by a class of investors who claimed that Wal-Mart artificially inflated its stock price by failing to disclose an alleged bribery scheme by a Wal-Mart subsidiary in Mexico.
During discovery, the plaintiffs deposed a former Wal-Mart investigator who had reviewed business records and interviewed fact witnesses about the events in Mexico. At the deposition, Wal-Mart asserted that much of the investigator's work was protected by the attorney-client privilege or work product doctrine and instructed him not to answer certain questions. The plaintiffs claimed they were entitled to fully examine the investigator and to all of the investigator's factual reports.
The Court agreed with the plaintiffs, noting that the party asserting the attorney-client or work product privilege bears the burden of showing that privilege applies. The Court explained that "all that [Wal-Mart has] offered as evidence are general, conclusory assertions by counsel that litigation was anticipated," and that "[i]f this was sufficient, it would render the burden to establish the protection meaningless." Accordingly, the Court ordered Wal-Mart to produce the investigator for a second deposition of and to produce his interview reports and other factual compilations.
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