Justices Limit Appeals |on Disclosure Orders

(CN) - The U.S. Supreme Court voted unanimously to limit companies' ability to appeal orders requiring them to disclose attorney-client information. Tuesday's opinion, written by newly seated Justice Sonia Sotomayor, is the first of the new term.

The high court ruled against carpet maker Mohawk Industries in a case involving former worker Norman Carpenter. Carpenter allegedly told a human resources manager that the company knowingly hired undocumented workers. But Carpenter didn't realize that Mohawk faced a class action accusing it of driving down legal workers' wages by hiring illegal immigrants.

Mohawk told Carpenter to meet with its outside attorney, Juan Morillo, who allegedly pressured Carpenter to recant his statements. When Carpenter refused, he claimed Mohawk fired him under false pretenses. Mohawk insisted it fired Carpenter because an investigation revealed that he had violated immigration law.

The district court ordered Mohawk to hand over information about Carpenter's meeting with Morillo. It said Mohawk had waived the attorney-client privilege through its disclosures in the pending class action.

The 11th Circuit dismissed Mohawk's appeal, saying the lower court's order was not a "final decision" that could be immediately appealed.

The Supreme Court heard the case in early October.

Mohawk argued that the attorney-client privilege is important enough to allow for immediate review. Carpenter disagreed, saying such an allowance could flood the courts with appeals.

"The question before us is whether disclosure orders adverse to the attorney-client privilege qualify for immediate appeal under the collateral order doctrine," Justice Sonia Sotomayor wrote in her first opinion of the new term. "Agreeing with the Court of Appeals, we hold that they do not."

Sotomayor said post-judgment appeals adequately protect the rights of litigants and "preserve the vitality of the attorney-client privilege."

"We routinely require litigants to wait until after final judgment to vindicate valuable rights, including rights central to our adversarial system," she noted.

Justice Clarence Thomas wrote separately to emphasize that prejudgment orders should only be appealable in the circumstances outlined in Cohen v. Beneficial Industrial Loan Corp (1949).

"I would affirm the 11th Circuit's judgment on the ground that any 'avenue for immediate appeal' beyond the three avenues addressed in the Court's opinion must be left to the 'rulemaking process,'" he wrote.

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