ARB CASE NO. 98-060
(Formerly ARB CASE NO. 97-107)
ALJ CASE NO. 85-CAA-1
DATE: NOV 6 2002
In the Matter of:
DONALD J. WILLY,
COMPLAINANT,
v.
THE COASTAL CORPORATION AND
COASTAL STATES MANAGEMENT CO.,
RESPONDENTS.
BEFORE: THE ADMINISTRATIVE REVIEW BOARD
ORDER REQUESTING BRIEFING BY THE ASSISTANT SECRETARY OF LABOR FOR OCCUPATIONAL SAFETY AND HEALTH AND
ADDITIONAL BRIEFING BY COMPLAINANT AND RESPONDENTS
The Administrative Review Board (ARB), with considerable reluctance, requests additional briefing in this case. The parties have endured a lengthy adjudicative history spanning more than sixteen years. The current Members of the Board are placing the highest priority on the older cases. We are committed to adjudicating the Willy case in an expeditious and reasoned manner. Nonetheless, we conclude that the minimal delay resulting from this Order is warranted due to the importance of the issues raised.
The ARB has reviewed the facts and the numerous legal issues in the case and concludes that the application of longstanding common law principles concerning attorney-client privilege in the context of the federal whistleblower protection statutes presents a significant issue of first impression. We are seeking the views of the Assistant Secretary, Complainant and Respondents and others who may wish to file friend of the court briefs and believe the Board's deliberations will be aided by the arguments provided.
On June 1, 1994, the Secretary issued a Final Decision and Order (Sec'y Fin. D. & O.) (attached), finding for Willy and remanding the damages issue to the ALJ. The Secretary rejected Coastal's argument that Coastal's assertion of the attorney-client privilege precluded Willy from introducing his draft Beleher Reports into evidence and relying upon the contents of the reports in support of his claim that he engaged in conduct protected by the employee protection provisions. The Secretary stated:
Respondent excepted to the admission in evidence of annotated copies of Complainant's Belcher report, C-8 1 and 84, arguing that introduction of those exhibits was prohibited by Respondent's claim of attorney-client privilege. These documents were at the heart of Complainant's case and by admitting them in evidence, Respondent argues, the ALJ not only sanctioned the violation of the privilege but placed Respondent at an unfair disadvantage. Complainant was able to present his case through use of the exhibits, but Respondent could not rebut it through other privileged documents or by permitting its employees to answer questions about the exhibits without having waived the privilege.
Sec'y Fin. D. & O., slip op. at 7-8.
Citing proposed Supreme Court Standard 503 - Lawyer Client Privilege, the Model Rules of Professional Conduct, the Model Code of Professional Responsibility, the Texas Disciplinary Rules of Professional Conduct and the Fifth Circuit's decision in Doe v. A Corp., 709 F.2d 1043 (1983), the Secretary determined that the draft reports could be admitted as evidence under both federal and Texas law. Id. at 8-10. He specifically noted that "application of a privilege is a matter of federal law in a case such as this arising under the laws of the United States." Id. at 9 n.4. The Secretary then found for the Complainant on the merits and remanded the case to the ALJ to award remedial relief.
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The Secretary's 1994 decision reaffirmed his prior holding in Willy v. Coastal Corp., Sec'y D. & O. of Rem., June 4, 1997, that Willy's internal complaint, the Belcher drafts, was protected, notwithstanding the Fifth Circuit's decision in Brown & Root. Also, the Secretary declined to continue the ALJ's March 15, 1988 order sealing the record.
The Fifth Circuit denied Coastal's petition for review of the Secretary's decision. Coastal Corp. v Reich, No. 94-40334. The Secretary denied reconsideration of his decision on July 13, 1995.
In 1997, the ALJ issued a Recommended Decision and Order on Damages, Fees, and Costs and a subsequent Order Recommending Correction of Recommended Decision and Order on Damages, Fees and Costs. The two orders of May 8 and December 14, 1987, are now before the Administrative Review Board.2
On November 19, 1999, Coastal filed a Motion to Dismiss with the ARB, contending that the state judgment in Willy's separate Texas action for retaliatory discharge, Willy v. Coastal States Management Co., 939 S.W.2d 193 (Tex. App. 1996), writ dism'd, 977 S.W.2d 566 (Tex. 1998), established a legal principle fatal to Willy's claims in this proceeding.
Need for Additional Briefing
This is the first case brought by a former in-house attorney under the whistleblower statutes at issue. The Board believes that additional review of attorney-client privilege and confidentiality issues is warranted to ensure that relevant legal authority and analysis are brought to the Board's attention. The "law of the case" doctrine does not preclude further consideration of the Secretary's June 1, 1994 ruling on these matters. The doctrine is discretionary and does not limit a court's power to reconsider its own decision prior to final judgment if its original ruling was erroneous. Cristianson v. Colt Industries Operating Corp., 486 U.S. 800, 817 (1988); DeLong Equipment Co. v. Washington Mills Electro Minerals Corp., 990 F. 2d 1186, 1197 (11th Cir. 1993); In re US. Postal Service ANET and WNET Contracts, ARB No. 98-13 1, slip op. at 12 (Aug. 4, 2000). Cf. Lockert v. U.S. Dept. of Labor, 867 F.2d 513, 517-18 (9th Cir. 1989).
In view of the importance of these matters for the adjudication and disposition of whistleblower discrimination complaints now investigated by the Assistant Secretary of Labor for Occupational Safety and Health under the environmental statutes at 29 C.F.R. Part 24(2002), the Board invites the Assistant Secretary to file an amicus brief to be submitted within 45 days of receipt of this notice. In addition, Complainant and Respondents are ordered to submit briefs within 45 days of receipt of this notice.
The briefs of the Assistant Secretary and the parties should address the following matters:
1) Does the attorney-client privilege apply to Willy's drafts of the Belcher Report?
2) Is there an exception to the applicable Federal common law or State law of attorney-client privilege for use of client confidences or secrets or related attorney advise in establishing a claim under the federal whistleblower statutes at issue? See Willy v. Coastal States Management Co., Inc., 939 S.W.2d 193 (Tex. App. 1996), writ dism'd, 977 S.W.2d 566 (Tex. 1998).
3) Is there an ethical duty of confidentiality to a client which the ARB has authority to apply to prevent Willy from introducing evidence or testimony obtained through his work on the Belcher Report?
4) Do the worker and public safety and environmental goals of the environmental whistleblower statutes involved in this case negate or modify the dictates of attorney-client privilege and/or attorney-client confidentiality? See 29 C.F.R. § 18.501 (2002) (ALJ hearing rule on privileges). Cf. Fed R Evid. 501 (2002).
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In responding to the above, the briefs of the Assistant Secretary and the parties should specify the Federal and/or State authority for the positions advanced.
The briefs of the parties in this case should also address the following matters:
1) Can Complainant establish that he engaged in protected activity if he is precluded from relying upon the draft Belcher report and/or testimony concerning its contents? See Kachinar v. SunGard Data Systems, Inc., 109 F.3d 173, 180 (3d Cir. 1997) (quoting General Dynamics Corp. v. Superior Court, 87 P.2d 487, 490 (Cal. 1994)). Supply record citations.
2) Have Respondents waived the attorney-client privilege?
An original and four copies of all briefs shall be filed with the Administrative Review Board, U.S. Department of Labor, 200 Constitution Avenue, N.W., Room S-4309, Washington, D.C., 20210.
Attachments
FOR THE ADMINISTRATIVE REVIEW BOARD:
Janet R. Dunlop
Dunlop Counsel
[ENDNOTES]
1 The complaint was filed pursuant to the employee protection provisions of the Clear Air Act, 42 U.S.C. §7622 (1988), the Water Pollution Control Act, 33 U.S.C. §1367 (1988), the Safe Drinking Water Act, 42 U.S.C. §300j-9(i) (1988), the Resource Conservation and Recovery Act, 42 U.S.C. §6971 (1988), the Toxic Substances Control Act, 15 U.S.C. §2622 (1988), and the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. §9610 (1988).
2See Sec'y Ord. 1-2002, 67 Fed. Reg. 64272, (Oct. 17, 2002) (delegating authority to the Administrative Review Board to issue final agency decisions on questions of law and fact arising in an appeal under the whistleblower provisions of the environmental acts).
3 The United States Supreme Court subsequently upheld the District Court's authority to award sanctions against Willy although the District Court was later determined to lack subject matter jurisdiction. Willy v. Coastal Corp., 503 U.S. 131 (1992).
4Sabine Pilot Serv., Inc. v. Hauck, 687 S.W.2d 733 (Tex. 1985).