                                                                                                                           Opinions of the United
1995 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


5-23-1995

Glenmede Trust v Thompson
Precedential or Non-Precedential:

Docket 94-2189




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                 UNITED STATES COURT OF APPEALS
                     FOR THE THIRD CIRCUIT
                          ___________

                           No. 94-2189
                           ___________

          GLENMEDE TRUST COMPANY;
          PEPPER, HAMILTON & SCHEETZ,

                                  Petitioners

                         vs.

          B. RAY THOMPSON, JR.; JUANNE J. THOMPSON;
          CATHERINE V. THOMPSON; ADELLA S. THOMPSON;
          B. RAY THOMPSON, III; SARAH THOMPSON TARVER;
          REBEKAH L. THOMPSON; B. RAY THOMPSON, JR., AS
          TRUSTEE OF FIVE THOMPSON FAMILY TRUSTS;
          JUANNE J. THOMPSON, AS TRUSTEE OF FIVE THOMPSON
          FAMILY TRUSTS; DALE A. KEASLING, AS TRUSTEE OF
          FIVE THOMPSON FAMILY TRUSTS,

                                  Respondents

                         vs.

          THE HONORABLE HERBERT J. HUTTON, UNITED
          STATES DISTRICT JUDGE,

                                Nominal Respondent
                           ___________

          Appeal from the United States District Court
            for the Eastern District of Pennsylvania
                   (D.C. Civ No. 92-cv-05233)
                           ___________

                              Argued
                          March 29, 1995
      Before:   MANSMANN, COWEN and LEWIS, Circuit Judges.

                     (Filed May 23 , 1995)
                          ___________

William A. Slaughter, Esquire
Alan J. Davis, Esquire (ARGUED)
Ballard, Spahr, Andrews &
  Ingersoll
1735 Market Street
51st Floor
Philadelphia, PA    19103

            COUNSEL FOR PETITIONER GLENMEDE TRUST COMPANY

William T. Hangley, Esquire (ARGUED)
Sara M. Staman, Esquire
Hangley, Aronchick, Segal & Pudlin
One Logan Square
Philadelphia, PA 19103

            COUNSEL FOR PETITIONER PEPPER, HAMILTON & SCHEETZ

Michael C. Spencer, Esquire (ARGUED)
Milberg, Weiss, Bershad,
Hynes & Lerach
One Pennsylvania Plaza
49th Floor
New York, NY 10119

James J. Binns, Esquire
James J. Binns, P.A.
The Mellon Bank Center, 39th Floor
1735 Market Street
Philadelphia, PA 19103

            COUNSEL FOR RESPONDENTS
                             ___________

                        OPINION OF THE COURT
                             __________


MANSMANN,   Circuit Judge.

            Before us is a Petition for Writ of Mandamus filed by a

law firm and its client, a trust company which is a defendant in

the underlying diversity action involving claims for breach of

fiduciary duty, fraud, breach of contract and negligence, arising

from the trust company's role in a stock repurchase transaction.

They jointly seek a writ directing the district court to vacate

and reverse its orders compelling the law firm to comply with a
subpoena duces tecum requesting its file relating to all work it

performed for the client regarding the repurchase transaction.

           They also seek a writ directing the district court to

vacate and reverse its order denying their request for a

protective order to enforce the umbrella of confidentiality

established by a confidentiality agreement stipulated to by the

parties to the underlying dispute, but which was never embodied

in an order of the district court.   In that regard, the specific

issue we must decide is whether general allegations of

embarrassment and injury to professional reputations and client

relationships satisfies the "good cause" requirement for the

issuance of an umbrella protective order pursuant to our recent

decision in Pansy v. Borough of Stroudsburg, 23 F.3d 772 (3d Cir.

1994).   The law firm and its client assert that they will be

unable to rectify the harm to their reputations and client

relationships if the law firm's privileged documents are publicly

disseminated.

           We find that although they have established that there

are no alternative avenues of appeal for these discovery orders,

the law firm and the client trust company have failed to

establish their clear and indisputable right to the writ.     They

failed to establish "good cause" for the protection of all of the

law firm's file documents pursuant to the confidentiality

agreement.   Nor have they demonstrated that the district court

erred in determining that the scope of the client's waiver of the

attorney-client privilege, by injecting the client's reliance on
advice of counsel as an issue in the underlying action, extended

to the entire transaction, including back-up documents.

          Accordingly, we decline to issue the requested writs.
                                I.

           Glenmede Trust Company ("Glenmede") is a Pennsylvania

trust company that serves as the trustee for several charitable

trusts, including the Pew Charitable Trusts.1   Glenmede also

serves as a trustee for a number of private trusts and acts as an

investment advisor pursuant to a written contract for other

clients.   B. Ray Thompson, Jr., several members of his family2

and the trustees3 of five trusts established by B. Ray Thompson,

Sr. for the benefit of his five grandchildren (collectively "the

Thompson Family") were investment advisory clients of Glenmede.

Prior to September 11, 1990, both the Pew Charitable Trusts and

the Thompson family held substantial shares of Oryx Energy

Company stock; the Pew family's Oryx holdings totalled in excess

of 25 million shares and the Thompson family's Oryx holdings

totalled approximately 2.9 million shares.   In mid-1990, Glenmede

broached, with Oryx management, the subject of a direct buy-back

of Oryx shares held by the Pew Charitable Trusts.   Oryx was

willing to repurchase a maximum of 18 million shares at a premium

price per share but requested that buy-back discussions be kept

1
 .        The Pew Charitable Trusts are comprised of the Pew
Memorial Trust, the J. Howard Pew Freedom Trust, the Mabel Pew
Myrin Trust, the Trust under Paragraph 9 of the Will of J. N.
Pew, Jr., and the Trust under the Will of Ethel Pew.
2
 .        These include B. Ray Thompson's wife, Juanne J.
Thompson, and his five children, Adella S. Thompson, Sarah
Thompson Tarver, Rebekah L. Thompson, Catherine V. Thompson and
B. Ray Thompson, III.
3
 .        The trustees are B. Ray Thompson, Jr., Juanne J.
Thompson and Dale A. Keasling.
confidential.   Given the limitations on the buy-back, Glenmede

consulted its counsel, Pepper, Hamilton & Scheetz, as to whether

the Oryx transaction could be extended to include Glenmede's

private trust and investment advisory clients.4

          Pepper Hamilton issued an Opinion Letter dated

September 6, 1990 advising Glenmede that the buy-back transaction

could not be structured to include private clients of Glenmede as

to do so may violate Internal Revenue Code prohibitions on

private foundations.5   Pepper Hamilton further advised Glenmede

that it could not notify its private clients of the buy-back

negotiations between Oryx and Glenmede acting in its capacity as

trustee of the Pew Charitable Trusts.   On September 11, 1990,

Oryx repurchased through Glenmede 18 million of its common shares

held by the Pew Charitable Trusts and converted the remaining 7.3

million common shares held by the Pew Charitable Trusts to

convertible preferred shares.   Allegedly, based on the Opinion

Letter from Pepper Hamilton, Glenmede excluded its private

clients with holdings of Oryx stock from the buy-back
transaction.

4
 .        Pepper Hamilton had a long-standing relationship with
Glenmede and the Pew family. It incorporated Glenmede in 1956,
drafted the trust instruments for the Pew charitable trusts
administered by Glenmede, and attended all meetings of Glenmede's
Board of Directors. A partner of Pepper Hamilton always served
as the secretary and a board member of Glenmede.
5
 .        The Opinion Letter contained Pepper Hamilton's legal
"opinion concerning the inclusion of certain private trusts and
estates in transactions which may be undertaken by the Glenmede
Trust Company on behalf of the charitable trusts for which it is
trustee."
          In September of 1992, the Thompson family brought an

action against Glenmede, its parent Glenmede Corporation, a

number of Glenmede officers and directors and the Chairman and

CEO of Oryx, who was dismissed from this action, asserting, inter

alia, claims for breach of fiduciary duty, fraud, breach of

contract, and negligence, all allegedly arising from Glenmede's

role in the September 11, 1990 buy-back transaction, in which

Oryx repurchased 18 million of its shares from Glenmede as

trustee of the Pew Charitable Trusts.   Glenmede raised as its

Fourteenth affirmative defense to these charges that it "was

advised by counsel that it was legally precluded by Internal

Revenue Code prohibitions from including Oryx shares held by

other accounts in the repurchase transaction."

          Glenmede concedes that the impact of placing at issue

its reliance on advice of counsel was a waiver of the attorney-

client privilege limited to the subject matter placed at issue.

Glenmede admitted only to a waiver of the attorney-client

privilege relating to the subject matter of the Opinion Letter,

which it submits is broader than tax advice which is the primary

subject of the Opinion Letter, but narrower than the totality of

the advice rendered regarding the buy-back transaction.6    In

accordance with its position, Glenmede produced the Pepper

Hamilton Opinion Letter and a draft Opinion Letter in response to

discovery requests served by the Thompson family.
6
 .        Glenmede admitted at oral argument that the waiver was
broader than tax advice but narrower than the entire transaction.
Glenmede, however, did not offer further specificity regarding
the scope of its waiver of the attorney-client privilege.
          In response to the Thompson family's concern regarding

the production of financial records, the parties stipulated to a

"Confidentiality Order" restricting the disclosure of documents

to be produced and establishing measures to maintain

confidentiality pending an appeal from final judgment.   As

evidenced by the terms of the confidentiality agreement, the

parties contemplated the wholesale adoption of that agreement by

the district court.   Although it was filed with the district

court for approval, it was never endorsed in an order of court.

Nevertheless, the parties complied with its terms, including the

filing of pleadings under seal.

          On July 30, 1993, the Thompson family served a subpoena

duces tecum on Pepper Hamilton, requesting its entire file

concerning services performed for Glenmede in connection with the

buy-back transaction.   Pepper Hamilton and Glenmede objected to

the production of Pepper Hamilton's file on the basis of the

attorney-client privilege.   On October 18, 1993, the Thompson

family filed a motion to compel the production of the file,

arguing that Glenmede waived the attorney-client privilege

because it raised reliance on advice of counsel pertaining to the

buy-back transaction as an affirmative defense to the Thompson

family's claims.   The Thompson family further contended that

Glenmede's concern regarding the production of Pepper Hamilton's

file was unwarranted given the protection afforded by the

confidentiality agreement to which the parties stipulated.

          By Memorandum and Order dated December 14, 1993, the

district court granted the Thompson family's motion to compel,
concluding that Glenmede waived its attorney-client privilege

concerning all communications, whether written or oral, to or

from counsel, regarding the buy-back transaction.    The district

court ordered that Pepper Hamilton produce its entire file for

services performed on behalf of Glenmede pertaining to the buy-

back transaction, including all back-up documents to the Opinion

Letter.   Glenmede and Pepper Hamilton moved for reconsideration

of that Memorandum and Order, challenging the district court's

conclusion that their invocation of the defense of reliance on

advice of counsel resulted in a waiver of the attorney-client

privilege encompassing all services Pepper Hamilton performed in

connection with the buy-back transaction.7    Glenmede asserted

that its waiver was limited to tax advice embodied in the Opinion

Letter.   By Memorandum and Order dated April 8, 1994, the

district court rejected Glenmede's motion for reconsideration on

the basis that the Opinion Letter discussed a number of issues in

addition to tax advice, including insider trading and the

financial ramifications of the transaction.         The district

court also concluded that Pepper Hamilton's involvement in

structuring and closing the transaction required the production

of back-up documents to the Opinion Letter to permit the Thompson

family to analyze the reasonableness of Glenmede's reliance on

the advice of counsel.



7
 .        At no time did Pepper Hamilton and/or Glenmede seek an
in camera inspection of the file documents they sought to
preclude from discovery.
            Glenmede and Pepper Hamilton did not seek a writ of

mandamus for immediate relief from the district court's orders

compelling the production of documents; they opted to defer

appellate review of the district court's rulings until final

judgment.    Instead, Pepper Hamilton produced in excess of 13,000

documents in compliance with the district court's orders.

            On June 20, 1994, Glenmede and the other defendants

filed a motion for summary judgment under seal, attaching several

Pepper Hamilton file documents for which the attorney-client

privilege had been asserted but deemed waived by the district

court.   On June 27, 1994, the Thompson family challenged the

"confidential" designation of the Pepper Hamilton file documents

and notified Glenmede of their intent to treat them as non-

confidential.8   On July 18, 1994, Glenmede and Pepper Hamilton

moved for a Protective Order objecting to the Thompson family's

wholesale challenge to the confidentiality of the documents.      The



8
 .        The confidentiality agreement provided a mechanism for
challenging the designation of documents as "confidential" --
provide notification to the producing party of challenge to
confidentiality, the parties confer in an attempt to resolve the
challenge and, if no agreement can be reached, seek court
intervention. The Thompson family mounted this challenge despite
their representations to the district court that Glenmede and
Pepper Hamilton's concerns regarding public disclosure were
unwarranted in light of the protection afforded by the stipulated
confidentiality agreement. Given our expectation that parties
operate in good faith during discovery, we note that this
challenge closely followed our decision in Pansy v. Borough of
Stroudsburg, 23 F.3d 772 (3d Cir. May 2, 1994), regarding the
impropriety of the issuance of broad confidentiality orders,
which signaled a shift from the previous practice of judicial
endorsement of such stipulations.
Thompson family cross-moved to unseal the summary judgment

documents filed under seal by Glenmede and the other defendants.

          On October 21, 1994, the district court heard arguments

on the pending motions.9   It directed the parties to negotiate

the issues raised in the motion for protective order and to

present a motion for the confidential treatment of particular

documents or categories of documents.   Glenmede, Pepper Hamilton

and the Thompson family, however, were unable to reach an

agreement regarding the confidential status of the Pepper

Hamilton file documents.   By Memorandum and Order dated November

22, 1994, the district court granted the Thompson family's motion

to amend the complaint to assert claims against individual Pepper

Hamilton attorneys, quoting from a number of the Pepper Hamilton

file documents.   By Memorandum and Order dated November 29, 1994,

the district court denied Glenmede and the other defendants'

motion for summary judgment.

          On November 30, 1994, Glenmede and Pepper Hamilton

filed an emergency motion to seal court records and for

protective order, seeking to seal both the district court's

November 22, 1994 Memorandum and Order and the October 21, 1994

hearing transcript, pending consideration of their motion for

protective order to keep the Pepper Hamilton documents


9
 .        The motions included Glenmede and the other defendants'
motion for summary judgment, Glenmede's motion for protective
order and the Thompson family's motion to add Pepper Hamilton
attorneys as defendants on the basis of information culled from
the Pepper Hamilton file documents, a motion to compel the
production of documents and a motion to unseal the record.
confidential and for use only in these proceedings.    By

Memorandum and Order dated December 2, 1994, the district court

denied Glenmede and Pepper Hamilton's initial motion for

protective order and granted the Thompson family's motion to

unseal the record.10   The district court determined that the

confidentiality agreement did not satisfy Pansy's "good cause"

requirement nor did Glenmede and Pepper Hamilton establish that

disclosure of the Pepper Hamilton documents would cause them a

defined and serious harm.

            On December 13, 1994, Glenmede and Pepper Hamilton

filed this petition for a writ of mandamus directing the district

court to vacate and reverse its December 14, 1993 and April 8,

1994 Memoranda and Orders compelling the production of the Pepper

Hamilton file documents and its December 2, 1994 order denying

confidentiality protection for those file documents.    In

addition, they seek a writ directing the district court:     to

place under seal its November 22 and 29, 1994 Memoranda and

Orders, the October 21, 1994 hearing transcript and all briefs

and pleadings that reference the Pepper Hamilton file documents;

to remove all references to those Memoranda and Orders from all

public access computer databases and district court records; and

to order that the Memoranda and Orders not be published in any

reporter.    Glenmede and Pepper Hamilton contend that the district


10
 .        The district court did not dispose of Glenmede and
Pepper Hamilton's emergency motion to seal court records and for
protective order until January 12, 1995 when it issued a
Memorandum and Order denying the unopposed motion.
court's denial of the protective order has revealed the Pepper

Hamilton file documents to the public, which cannot be remedied

on appeal from final judgment.    The public dissemination of the

Pepper Hamilton documents is the harm sought to be averted via

this mandamus petition.



                                 II.

            This is an appeal from discovery orders which are not

appealable as final decisions within the meaning of 28 U.S.C. §

1291.    See Haines v. Liggett Group Inc., 975 F.2d 81 (3d Cir.

1992).    Our jurisdiction is premised upon the All Writs Act,

which provides that the federal courts "may issue all writs

necessary or appropriate in aid of their respective jurisdictions

and agreeable to the usages and principles of law."    28 U.S.C.A.

§ 1651(a) (West 1994).    The issuance of the writ must aid some

present or potential exercise of appellate jurisdiction.     See

Westinghouse v. Republic of the Philippines, 951 F.2d 1414, 1422

(3d Cir. 1991).    Since this diversity action is potentially

within our appellate jurisdiction, we have jurisdiction to

consider the petition for a writ of mandamus.

            Nonetheless, our writ power should be invoked only in

extraordinary situations, see Kerr v. United States Dist. Court
for Northern Dist. of California, 426 U.S. 394, 402 (1976), i.e.,

only in limited circumstances where a party seeking issuance has

no other adequate means to attain the desired relief and

establishes that the right to the writ is clear and indisputable.
Haines, 975 F.2d at 89.   Once these prerequisites are met, the

issuance of the writ is a matter of discretion.   Id.

          Although mandamus is an appropriate means of immediate

appellate review of orders compelling the production of documents

claimed to be protected by privilege or other confidentiality

interest, Glenmede and Pepper Hamilton chose not to seek a writ

of mandamus to prevent the production of the privileged Pepper

Hamilton documents, instead relying on the protection afforded by

the stipulated confidentiality agreement.   See Bogosian v. Gulf

Oil Corp., 738 F.2d 587, 591 (3d Cir. 1985).   We must ascertain

whether mandamus is an appropriate means of immediate appellate

review of an order compelling the production of privileged

documents after those documents have been produced to the

discovering party.

          Glenmede and Pepper Hamilton properly exercised their

right to oppose the production of the privileged documents;

however, when faced with the choice of seeking immediate relief

through mandamus or producing the documents pursuant to the

stipulated confidentiality agreement, Glenmede and Pepper

Hamilton opted to produce the privileged documents.     They relied

on the fact that the Thompson family had adhered to the terms of

the confidentiality agreement through the time of production and

the Thompson's representation to the district court that Glenmede

and Pepper Hamilton's concerns regarding public disclosure were

unwarranted in light of the protection afforded by that
agreement.11    The district court's subsequent denial of Glenmede

and Pepper Hamilton's request for a protective order to enforce

the umbrella of the confidentiality agreement stripped Glenmede

and Pepper Hamilton of all means of appellate review, except this

post-production mandamus petition, to remedy potential damage

from the public disclosure of the Pepper Hamilton documents.12

Hence, there are no other avenues of appellate review available

to Glenmede and Pepper Hamilton to attempt to protect the

privileged documents, which they produced in reliance on the

confidentiality agreement, from widespread dissemination.    It is

in recognition of these unique circumstances that we proceed to

review whether there is a clear and indisputable right to the

writ regarding both the protective order and the order compelling

the production of the Pepper Hamilton files.    See Cipollone, 785

F.2d at 1118.
11
 .        We appreciate that our decision in Pansy, decided
shortly after the production occurred, surprised many by our
questioning the judicial endorsement of broad confidentiality
agreements:

          Disturbingly, some courts routinely sign
          orders which contain confidentiality clauses
          without considering the propriety of such
          orders, or the countervailing public
          interests which are sacrificed by the orders.

23 F.3d at 785.
12
 .        The protective order sought by Glenmede and Pepper
Hamilton and denied by the district court was to protect the
umbrella of confidentiality established by the confidentiality
agreement. The district court has not ruled on the
confidentiality of individual documents or categories of
documents. Thus, Glenmede and Pepper Hamilton may still seek a
protective order to maintain the confidentiality of specific
categories of documents or individual documents.
                                III.

          The district court's denial of Glenmede and Pepper

Hamilton's request for a protective order was an exercise of the

district court's discretion.    Mandamus is not available for abuse

of discretion but we may exercise mandamus jurisdiction regarding

the denial of a protective order if we find that the district

court committed a clear error of law.     Cipollone, 785 F.2d at

1118.   The district court applied Pansy v. Borough of

Stroudsburg, 23 F.3d 772 (3d Cir. 1994), and concluded that

public policy considerations strongly militated against judicial

sanctioning of the broad pre-Pansy confidentiality agreement

proffered by the parties.    The district court did not commit a

clear error of law requiring our issuing a writ of mandamus.

          A party seeking a protective order over discovery

materials must demonstrate that "good cause" exists for the

protection of that material.    Fed. R. Civ. P. 26(c); Pansy, 23

F.3d at 786.   "Good cause" is established when it is specifically

demonstrated that disclosure will cause a clearly defined and

serious injury.   Id.   Broad allegations of harm, unsubstantiated

by specific examples, however, will not suffice.    Id.   Glenmede

and Pepper Hamilton bore the burden of establishing "good cause"

to protect the umbrella of confidentiality established by the

confidentiality agreement.

          In Pansy, we recognized several factors, which are

neither mandatory nor exhaustive, that may be considered in

evaluating whether "good cause" exists:
          1)   whether disclosure will violate any privacy
               interests;

          2)   whether the information is being sought for a
               legitimate purpose or for an improper purpose;

          3)   whether disclosure of the information will cause a
               party embarrassment;

          4)   whether confidentiality is being sought over
               information important to public health and safety;

          5)   whether the sharing of information among litigants
               will promote fairness and efficiency;

          6)   whether a party benefitting from the order of
               confidentiality is a public entity or official;
               and

          7)   whether the case involves issues important to the
               public;


23 F.3d at 787-91.   Although we have recognized that the district

court is best situated to determine what factors are relevant to

the dispute, we have cautioned that the analysis should always

reflect a balancing of private versus public interests --

          Discretion should be left with the court to
          evaluate the competing considerations in
          light of the facts of individual cases. By
          focusing on the particular circumstances in
          the cases before them, courts are in the best
          position to prevent both the overly broad use
          of [confidentiality] orders and the
          unnecessary denial of confidentiality for
          information that deserves it . . . .


Id. at 789 (quoting Arthur R. Miller, Confidentiality, Protective

Orders, and Public Access to the Courts, 105 Harv. L. Rev. 427,

492 (1991)).

          We recognize the distinguishable factual context of

Pansy, from the facts of this appeal.   In Pansy, a newspaper
sought access to a settlement agreement entered into between the

Borough of Stroudsburg and its former police chief who had sued

the Borough after being demoted and suspended for allegedly

mishandling parking meter money.    23 F.3d at 776.    The public

interest in Pansy was "particularly legitimate" given that one of

the parties to the action was a public entity.     Id. at 786.    The

public interest in access to information under freedom of

information laws was the overriding factor that tipped the

balance in favor of not granting a confidentiality order which

would prevent disclosure pursuant to freedom of information laws.

Id. at 791-92.   Here, Glenmede and Pepper Hamilton assert that

there is no legitimate public interest to be served by widespread

dissemination of the Pepper Hamilton documents.       See Pansy, 23

F.3d at 788 ("[I]f a case involves private litigants, and

concerns matters of little legitimate public interest, that

should be a factor weighing in favor of granting or maintaining

an order of confidentiality.").    They contend they will be harmed

by the Thompson family's disclosure of the privileged documents

to other Glenmede clients who were excluded from the transaction

and to the media.   They are unable, however, to articulate any

specific, cognizable injury from that dissemination.

          Under Pansy, "[b]road allegations of harm,
unsubstantiated by specific examples or articulated reasoning" do

not support a good cause showing.    Id. at 786.   Glenmede and

Pepper Hamilton do not describe their harm other than in

generalized allegations of injury to reputation and to

relationships with clients.   For instance, Glenmede and Pepper
Hamilton assert that the Thompsons' primary goal in reversing

their position on confidentiality "is to publicize their

allegations of a scheme between Glenmede and [Pepper Hamilton] in

order to maximize the embarrassment and potential economic damage

which such averments could generate to those institutions'

relationships with their clients and the public."   Petition at

30.   General allegations of injury to reputation and client

relationships or embarrassment that may result from dissemination

of privileged documents is insufficient to justify judicial

endorsement of an umbrella confidentiality agreement.13    We have

13
 .        Moreover, the record of this case compels us to deny
the requested writ despite our recognition of the importance of
protecting the attorney-client privilege. See Haines v. Liggett
Group Inc., 975 F.2d 81, 90 (3d Cir. 1992). We reiterate that
the district court was never asked to perform an in camera
inspection of any of the documents in conjunction with the
request for protective order. In fact, when the district court
requested that the parties segregate the documents into separate
categories for consideration of confidentiality, the parties were
unable to agree. Nor did Glenmede and Pepper Hamilton seek a
protective order for specific documents that may prove harmful to
their client relationships and/or reputations. As the district
court noted:

           [Glenmede and Pepper Hamilton] do not seek a
           Confidentiality Order. Rather they seek to
           protect the confidentiality agreement
           stipulated to by the parties. An "umbrella"
           of confidentiality already exists, but now
           the defendants must show good cause for
           protecting that confidentiality agreement.

December 2, 1994 Memorandum and Order at 5.

          At oral argument, we questioned whether Glenmede and
Pepper Hamilton may seek relief through an independent breach of
contract action stemming from the Thompson family's public
dissemination of the file documents. (The only disclosure to
date by the Thompson family of which we are aware was to aid the
filing of a separate action by a similarly-situated plaintiff.)
typically viewed the "embarrassment" factor in terms of non-

pecuniary harm to individuals; however, the primary measure of

the well-being of a business is pecuniary.     See Cipollone, 785

F.2d at 1121.   Glenmede and Pepper Hamilton have failed to

sustain their burden of demonstrating they will sustain a

specific injury from the public dissemination of the privileged

documents sufficient to warrant the entry of an umbrella

protective order.

          In Pansy, we emphasized the strong public interest in

open proceedings.    See 23 F.3d 772.   See also Miller v. Indiana

Hosp., 16 F.3d 549, 551 (3d Cir. 1994) ("While we have recognized

that there are certain delineated areas where openness is not the

norm . . . [citations omitted], these cases are the exception.").

The allegations lodged against Glenmede stemming from its

involvement in the buy-back transaction impact the claims or

potential claims of other Glenmede clients who were excluded from

the transaction.    Federal courts should not provide a shield to

potential claims by entering broad protective orders that prevent

public disclosure of relevant information.     The sharing of

information among current and potential litigants is furthered by

open proceedings.    See Pansy, 23 F.3d at 787 ("Circumstances

(..continued)
Pepper Hamilton, however, conceded at oral argument that the
Thompson family's challenge to the confidential designation
affixed to the file documents comported with the literal terms of
the agreement, if not with the spirit of the agreement. The
agreement contemplated challenges to the confidential designation
of documents; however, neither Pepper Hamilton nor Glenmede
anticipated a wholesale challenge to confidentiality of the
Pepper Hamilton file.
weighing against confidentiality exist when confidentiality is

being sought over information important to public health and

safety [citation omitted], and when the sharing of information

among litigants would promote fairness and efficiency [citation

omitted].").   Absent a showing that a defined and serious injury

will result from open proceedings, a protective order should not

issue.14

           Despite Glenmede and Pepper Hamilton's arguments to the

contrary, the district court was not required to enter a

protective order merely to preserve for appellate review its

determinations that an exception to the attorney-client privilege

applied.   We have previously recognized the importance of

preserving the right to appeal a determination that an exception

to the attorney-client privilege applies prior to public

disclosure of the privileged information. In Haines we stated:
          Because of the sensitivity surrounding the
          attorney-client privilege, care must be taken
          that, following any determination that an
          exception applies, the matters covered by the
          exception be kept under seal or appropriate
          court-imposed privacy procedures until all
          avenues of appeal are exhausted.


975 F.2d at 97.   We did not intend, however, to establish a

steadfast rule that protective orders must always issue to

protect the privileged character of the materials sought in

discovery until all avenues of appeal, including appeal from a
14
 .        Because it is unnecessary to our decision, we do not
comment as to whether Glenmede and Pepper Hamilton would succeed
in obtaining a protective order regarding specific documents
contained in the Pepper Hamilton file.
final judgment, are exhausted.   Requiring the issuance of a

protective order in all circumstances where a district court has

determined that an exception to the attorney-client privilege

applies thwarts our policy of open proceedings absent a showing

of good cause to close them.   See Pansy, 23 F.3d 772; Miller, 16

F.3d 549.   Such a rule would be tantamount to permitting the

parties to control the use of protective orders.15   This is

especially evident where, as here, the party asserting the

privilege chooses to forego, until final judgment, appellate

review of the district court's determination that an exception to

the attorney-client privilege applies.

            The unique evolution of events in this case, however,

bids us to review the district court's determination as to the

scope of Glenmede's waiver of the attorney-client privilege.     We

recognize that the district court's denial of the protective

order subsequent to the production of the Pepper Hamilton file

15
 .        On March 14, 1995, the Judicial Conference of the
United States rejected a proposed amendment to Federal Rule of
Civil Procedure 26(c) that provides in part that: "the court . .
. may, for good cause shown or on stipulation of the parties,
make any order that justice requires to protect a party or person
from annoyance, embarrassment, oppression, or undue burden or
expense. . . ." (Emphasis in original). In addition, the
proposed rule would add a new section 26(c)(3) that provides a
means for modification or dissolution of a protective order on
motion of a party, a person bound by it or a person who has been
permitted to intervene to seek modification or dissolution. The
Judicial Conference recommitted the proposed amendments to Rule
26(c) to the Rules Committee for further study. Judicial
Conference of the United States, Preliminary Report Judicial
Conference Actions, March 14, 1995; Committee on Rules of
Practice and Procedure of the Judicial Conference of the United
States, Report of Advisory Committee on Civil Rules, December 13,
1994.
jeopardized Glenmede and Pepper Hamilton's ability to remedy on

appeal from final judgment the harm, if any, they may suffer as a

result of the public dissemination of the privileged materials.

This turn of events places Glenmede and Pepper Hamilton in the

unfortunate and unforeseeable position of seeking post-production

mandamus relief from the disclosure of privileged information.



                                 IV.

          The attorney-client privilege16 may be waived by a

client who asserts reliance on the advice of counsel as an

affirmative defense.    See Rhone-Poulenc Rorer, 32 F.3d at 863.

Under such circumstances, the client has made a conscious

decision to inject the advice of counsel as an issue in the

litigation.   Id.   Although we recognized these propositions in

16
 .        Communications that may be protected from disclosure
during discovery because of the attorney-client privilege possess
the following characteristics:

               (1) the asserted holder of the privilege
          is or sought to become a client; (2) the
          person to whom the communication was made (a)
          is a member of the bar of a court, or his or
          her subordinate, and (b) in connection with
          this communication is acting as a lawyer; (3)
          the communication relates to a fact of which
          the attorney was informed (a) by his client
          (b) without the presence of strangers (c) for
          the purpose of securing primarily either (i)
          an opinion of law or (ii) legal services or
          (iii) assistance in some legal proceeding,
          and (d) not for the purpose of committing a
          crime or tort; and (4) the privilege has been
          (a) claimed and (b) not waived by the client.

Rhone-Poulenc Rorer Inc. v. Home Indemnity Co., 32 F.3d 851, 862
(3d Cir. 1994).
Rhone-Poulenc, our holding in that case -- that a party does not

lose the privilege to protect attorney-client communications from

disclosure in discovery when his or her state of mind is placed

at issue -- was premised upon the unique facts of that case.     32

F.3d 864.    In Rhone-Poulenc, advice of counsel was not raised as

an affirmative defense nor were there any acts evincing a clear

intent to waive the attorney-client privilege by placing at issue

reliance on the advice of counsel.    Here, Glenmede raised

reliance on the advice of counsel regarding what parties should

be included in the buy-back transaction as an affirmative defense

to the Thompson family's claims and voluntarily produced the

Opinion Letter and a draft of it in response to discovery

requests.

            Glenmede and Pepper Hamilton concede that Glenmede

waived the attorney-client privilege regarding the Opinion Letter

and any communications between itself and Pepper Hamilton

pertaining to that letter.    They object, however, to the district

court's conclusion that Glenmede's waiver of the attorney-client

privilege encompassed the entire buy-back transaction, including

internal Pepper Hamilton back-up documents to the Opinion Letter

that were never communicated to Glenmede.    They submit that it

was clear error for the district court to expand the waiver

beyond the confines of the issue addressed in the Opinion Letter

to all communications, whether written or oral, to or from

counsel concerning the buy-back transaction.17

17
 .        We note that Glenmede and Pepper Hamilton base their
argument for our finding a limited waiver of the attorney-client
            There is an inherent risk in permitting the party

asserting a defense of its reliance on advice of counsel to

define the parameters of the waiver of the attorney-client

privilege as to that advice.    That party should not be permitted

to define selectively the subject matter of the advice of counsel

on which it relied in order to limit the scope of the waiver of

the attorney-client privilege and therefore the scope of

discovery.    To do so would undermine the very purpose behind the

exception to the attorney-client privilege at issue here --

fairness.

            The party opposing the defense of reliance on advice of

counsel must be able to test what information had been conveyed

by the client to counsel and vice-versa regarding that advice --

whether counsel was provided with all material facts in rendering

their advice, whether counsel gave a well-informed opinion and

whether that advice was heeded by the client.   See In re ML-Lee

Acquisition Fund II, L.P., 859 F. Supp. 765, 767 (1994).     Here,

the advice that Glenmede placed at issue related to the structure

of the transaction -- the identity of the parties and how many of

their shares would be repurchased by Oryx.    In fact, the Opinion

Letter indicates that Glenmede requested advice "concerning the

inclusion of certain private trusts and estates in transactions."

(..continued)
privilege exclusively on the confines of the attorney-client
privilege; they do not rely on the separate attorney work product
doctrine to prevent the disclosure of Pepper Hamilton's internal
file documents. See, e.g., Sporck v. Peil, 759 F.2d 312 (3d
Cir.), cert. denied, 474 U.S. 903 (1985); Bogosian v. Gulf Oil
Corp., 738 F.2d 587 (3d Cir. 1984).
Testing the advice of counsel defense regarding why only the Pew

Charitable Trusts were included in the transaction necessarily

encompasses, as Glenmede acknowledges, more than tax advice.    We

agree with the district court that Glenmede waived the attorney-

client privilege as to all communications, both written and oral,

to or from counsel as to the entire transaction.

          We also agree that Glenmede's waiver encompasses the

back-up documents to the Opinion Letter, which include Pepper

Hamilton's internal research and other file memoranda.18   A

review of these internal documents may lead to the discovery of

admissible evidence regarding what information had been conveyed

to Glenmede about the structure of the buy-back transaction and

the advice of counsel in that regard.   Because it is unnecessary

to our holding, we do not determine whether such documents are

relevant for any purpose other than the fact that they may lead

to the discovery of admissible evidence.19



                                V.



18
 .        We again note that Pepper Hamilton has not asserted
that these internal file memoranda are protected by the work
product doctrine, which would have required a different analysis
by the district court.
19
 .        We again note that Pepper Hamilton and Glenmede may
possess other means to protect the confidentiality of some of
these internal documents. They have never sought a protective
order respecting specific internal memoranda that, though
relevant for discovery purposes, may reveal information, such as
clients of Glenmede and Pepper Hamilton or financial information
not relevant to the dispute, that is not of public import.
           We also deny Glenmede and Pepper Hamilton's request for

a writ sealing district court opinions and a hearing transcript

and removing all opinions and pleadings referencing the Pepper

Hamilton documents from public access.   As we have previously

recognized, the right of access to judicial records is beyond

dispute.   See Miller, 16 F.3d at 551; Leucadia, Inc. v. Applied

Extrusion Technologies, Inc., 998 F.2d 157 (3d Cir. 1993).   As we

held above, we find that the district court did not err in its

rulings as to the scope of Glenmede's waiver of the attorney-

client privilege and the denial of a protective order requesting

an umbrella of confidentiality for the Pepper Hamilton documents.

Thus, we must also deny Glenmede and Pepper Hamilton's request

for mandamus relief from the dissemination of the Pepper Hamilton

file documents through public access to judicial records.



                               VI.

           For the foregoing reasons, we will deny the requested

writs of mandamus.


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