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30 / JOURNAL OF PENSION PLANNING & COMPLIANCE represented the fiduciaries, the plan, and the company was asked at trial to produce memos he had sent to the fiduciaries advising them on their liability for having previously “borrow[ed] approximately $800,000 . . . without adequate security” from the plan. 103 The Ninth Circuit held that the advice regarding the fiduciaries’ personal liability was protected by the privilege as personal advice, as distinguished from ongoing plan administration advice. 104 Many district courts have applied the Mett analysis to protect the attorney-client privilege of various communications, including legal advice about potential liability in amending and designing a plan, legal advice related to the potential exposure of the trustees in their personal capacity, and counsel’s comments on drafts of letters responding to specific benefit “inquiries, complaints, and claims,” although other general legal advice concerning the plan was subject to disclosure. 105 Several other courts applied the Mett analysis to claims litigation, and concluded that, in that context, postdecisional advice was protected by the attorney-client privilege, although predecisional advice must be disclosed. 106 For example, in one case where a participant challenged a plan’s decision to terminate COBRA coverage, the court relied on Mett in concluding that a line should be drawn based on the date the plan administrator notified the participant that it was discontinuing COBRA coverage. 107 Advice provided by the plan’s attorney following that date was privileged, but advice provided before then was not. Another court held that an e-mail to in-house counsel regarding overpayment of benefits was privileged because it was created after the lawsuit had been filed, and it sought a legal opinion about matters pertaining to the action. 108 In contrast, documents created before the final denial of benefits were not privileged, including e-mails and memos to and from the employer’s corporate counsel regarding the termination of benefits and the progress of the appeal of the benefits decision. With respect to these documents, the court reasoned that “[t]here [was] no indication . . . that [counsel] was consulted for the purpose of defending [the employer] against any decision made as to Plaintiff’s claim. Rather, it appears that [counsel] was consulted in the context of the claims review process itself.” 109 Adopting a similar approach, the court in Lewis v. UNUM Corp. Severance Plan 110 found that the attorney-client privilege did not shield advice given by inside and outside counsel during a predecisional administrative meeting concerning the participant’s claim for severance benefits. The court rejected the argument that the advice was privileged because it had been rendered to defend the plan fiduciaries against a future claim. If such an argument were accepted, the court reasoned, a beneficiary could never discover the predecisional legal advice of the plan administrator’s counsel. Instead, the court concluded that denying
ATTORNEY-CLIENT PRIVILEGE ISSUES IN EMPLOYEE BENEFITS PRACTICE / 31 benefits to a beneficiary is as much a part of plan administration as conferring benefits, and therefore “the prospect of post-decisional litigation against the plan is an insufficient basis for gainsaying the fiduciary exception to the attorney-client privilege.” 111 In a case involving attorney-client communications regarding administrative claims of beneficiaries who had already filed suit, another district court rejected the fiduciary exception argument advanced by the plaintiffs because the plan fiduciary retained counsel in order to defend against the plan beneficiaries. 112 Two labor unions and two groups of former Boeing employees brought suit against Boeing, Spirit Airlines, and various employee benefit plans, in order to enforce collective bargaining agreements between the unions and Boeing and secure favorable rulings concerning pension and health benefits for certain employees between ages 49 and 55. The plaintiffs moved to compel the defendants to produce documents that the defendants claimed were protected by the attorney-client privilege and/or attorney work product doctrine. The plaintiffs argued that the fiduciary exception applied and that ERISA beneficiaries are entitled to discover the legal advice that guides a plan administrator in interpreting their eligibility for benefits. The defendants countered, and the court agreed, that the fiduciary exception did not apply because the beneficiaries had already commenced litigation and the plan fiduciary had retained counsel in order to defend itself against the beneficiaries. The court found that the plan fiduciary had retained counsel for legal advice precisely because the plaintiffs had already commenced litigation and alleged that it had breached its fiduciary duties to the beneficiaries. Therefore, “the legal fiction of the trustee as a representative of the beneficiaries’ [was] dispelled. . . . The legal advice was sought because of the pending litigation and claims of personal liability; thus, the attorney-client privilege remains intact.” 113 Additionally, the plaintiffs argued that they only sought to discover advice on plan interpretation, rather than advice relating to a fiduciary’s personal liability, and so should be entitled to these communications. Dismissing this argument, the court held that “the implied suggestion that counsel could provide meaningful advice to the [plan fiduciary] concerning personal liability without evaluating the language of the plan is simply not persuasive.” 114 In a footnote, the court noted that the plaintiffs relied heavily on Lewis v. UNUM Corp. Severance Plan 115 to support their claim for production. 116 The court distinguished Lewis on the grounds that the legal communication ordered there was both “predecision” and “prelitigation” and “[m]ost significantly,” the court observed, “the claim in Lewis was limited to a request for benefits under the plan. The circumstances in this case are materially different from those presented in
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