State environmental audit privilege laws: can EPA still access environmental audits in federal court?

I. INTRODUCTION

Over the last twenty-five years Congress, states, and administrative agencies have woven a complex web of environmental laws and regulations.(1 )Facing fines, criminal prosecutions of employees, and bad publicity if they are labeled as "polluters," diligent companies are seeking ways to protect themselves from this web. One method of protection is to conduct an internal investigation, or environmental audit, to self-evaluate compliance with federal and state environmental laws and regulations before regulators cover a violation.(2) Companies perform environmental audits by reviewing both records and operational practices. The Environmental Protection Agency (EPA) encourages companies to conduct these audits as a way to enhance the protection of the human health and the environmental.(3) The documents produced by such an audit, however, can be a double-edged sword for companies. While the identification of deficiencies allows the companies to correct problems, it can also create an incriminating paper trail for civil or criminal enforcement actions, serving as evidence that the companies were not in compliance with environmental laws.(4)

One answer to this dilemma is to develop an evidentiary privilege for environmental audits that would exclude them as evidence in enforcement actions or litigation.(5) Privilege advocates argue this protection will encourage companies to continue these rigorous self-inspections and ultimately improve compliance with environmental laws.(6 ) Currently, however, there is no federal statutory privilege for these audit documents. Nor do environmental audits easily fit into traditional federal common law privileges.(7) States, therefore, have taken matters into their own hands.(8) Since 1993, seventeen states have passed legislation creating a privilege for voluntary environmental audits.(9) These state privilege laws, however, conflict with federal environmental legislation that explicitly authorizes EPA access to such information.(10)

This Comment will analyze whether a federal court should uphold a state privilege law for environmental audits where EPA seeks access to such documents under its statutory authority. While not bound by state privilege law in federal question cases, federal courts can consider the policy reasons for granting such a privilege and adopt a new federal common law privilege.(11) Therefore, how federal courts decide to weigh these state statutory privileges in cases based on federal law will have a significant effect on EPA'S information-seeking authority when requesting environmental audits.

Part II explains in more detail what environmental audits are and why state privilege laws for these audits conflict with EPA's ability to access information as authorized in federal environmental laws. Part III analyzes how federal courts apply privileges. Part IV discusses how environmental audits do not fit into currently recognized federal common law privileges. Part V suggests why federal courts should not create a new federal common law privilege for environmental audits. Part VI concludes that state privilege statutes for environmental audits should not apply when EPA attempts to gain access to environmental information in federal courts.

II. How State Privilege Laws For Environmental Audits Conflict with Federal Environmental Laws

A. Environmental Audit Basics

Companies conduct internal environmental audits to assess compliance with environmental laws and regulations. Companies inspect their own operations or hire contractors to perform the review and the companies compare their actual practices against 'applicable environmental regulations."(12) Over the past decade, companies have increasingly used environmental audits to track their compliance records.(13)

While there is no correct format or method for such audits, the various definitions of environmental audits have similar elements. EPA defines environmental audits as 'a systematic, documented, periodic and objective review by regulated entities of facility operations and practices related to meeting environmental requirements."(14) Five state privilege laws similarly define them as a voluntary, internal and comprehensive evaluation of one or more facilities or an activity at one or more facilities regulated [under state, federal, regional, or local laws] ... that is designed to identify and prevent noncompliance and to improve compliance [with those laws]."(15) Federal privilege legislation proposed in the Senate by Senator Mark Hatfield  R-or.) and Senator Hank Brown (R-colo.) and in the House by Representative Joel Hefley (R-Colo.) includes similar language, requiring an audit to be voluntary, initiated by the entity for the express purpose of conducting an audit, and designed to ensure compliance with federal environmental laws.(16)

Environmental audits provide companies numerous internal benefits, which include verifying compliance with the law, evaluating their environmental management systems, and helping them to prioritize environmental concerns.(17) Additionally, however, companies who use audits benefit when EPA and the Department of Justice (DOJ) pursue enforcement actions. EPA initially sought to encourage the use of audits in its 1986 environmental auditing policy by stating it would not routinely request and use the reports as part of its investigations.(18) To improve the frequency and quality of environmental audits, EPA updated the policy in 1995 and increased incentives for companies who audit.(19) In addition to not making routine requests for the audits, the new policy eliminates gravity-based civil penalties when violations are discovered through auditing if they are promptly disclosed and corrected.(20) EPA also agreed not to recommend criminal charges to DOJ when a company has demonstrated good faith through use of an audit and self-disclosure.(21) Similarly, a DOJ policy uses audits as mitigating factors in criminal enforcement prosecutions.(22) Finally, audits are mitigating factors under the new sentencing guidelines for environmental crimes.(23)

Despite these assurances from EPA and DOJ, some companies still seek more protection from the risks associated with generating such potentially incriminating information.(24) Companies argue the more effective their environmental audits are at discovering and reporting violations, the more likely they will be found in noncompliance and penalized.(25) Thus "good actors" who report their deficiencies will be penalized, while "bad actors" who do not report will go free.(26) Companies also contend that without a privilege, audits will be less thorough and communication of violations will be stifled, leading to less effective compliance.(27) A 1995 Price Waterhouse survey reported that sixty-six percent of companies who said they audit would not expand their audit programs unless penalties were eliminated for self-identified, reported, arid corrected violations.(28) Finally, companies also claim the audits will be used against them in citizen suits and toxic tort claims.(29)

B. State Environmental Audit Privileges

Numerous states have answered companies' calls for protection by creating state evidentiary privileges for environmental audits.(30) Oregon was the first to pass such a law in 1993.31 Oregon's lead was followed by Colorado, Illinois, Indiana, and Kentucky in 1994.(32) In 1995, privilege legislation was introduced in thirty-four states(33) and received approval in nine.(34) South Carolina New Hampshire, and Michigan added privilege laws during 1996 legislative sessions.(35) However some states have considered privilege law proposals and did not pass the legislation.(36)

While the scope of and requirements to enact the privilege vary among the states, the overriding theme of the laws is clear: to promote better environmental compliance by providing some protection from disclosure for companies who willingly engaged in self-inspections. The Arkansas statute's purpose section, which is similar to that of the other state privilege statutes, is illustrative:

[P]rotection of the environment is enhanced by the public's voluntary

compliance with environmental laws and ... the public will benefit from

incentives to

identify and remedy environmental compliance issues. It is further declared

that limited expansion of the protection against disclosure will encourage

such

voluntary compliance and improve environmental quality and that the

voluntary

provisions of this act will not inhibit the exercise of the regulatory

authority

by those entrusted with protecting our environment.(37)

C. Conflicts with Federal Environmental Laws

Federal environmental laws, however, directly conflict with such privileges by granting EPA authority to require a company to provide any information reasonably required to enforce environmental statutes. The Clean Air Act,(38) one of the first major federal environmental laws, broadly states that whenever it is necessary to carry out the objectives of the Act, the EPA Administrator or an authorized representative can "require any person who owns or operates any emission source ... who the Administrator believes may have information necessary for the purposes set forth in this subsection, or who is subject to any requirement of this chapter to ... provide such other information as the Administrator may reasonably require."(39) The Clean Water Act,(40) enacted two years later, contains similar language.(41) The Resource Conservation and Recovery Act(42) provides even broader access, stating that in order to enforce the Act, EPA, or a state with an authorized hazardous waste program, can request "any person who generates, stores, treats, transports, disposes of, or otherwise handles or has handled hazardous waste ... [to] furnish information relating to such wastes and permit [EPA]...at all reasonable times to have access to, and to copy all records relating to such wastes."(43) All of these provisions also require that such information be available to the public, unless it can legitimately be classified as a trade secret.(44)

The new state privilege laws for environmental audits are in direct conflict with the above provisions of major federal environmental laws. Additionally, they violate state program requirements that authorize states to run their own enforcement programs.(45) State officials must have access to any records necessary to investigate compliance with permit conditions and other program requirements for a state to maintain its authorization.(46) While most state privilege laws do not protect information specifically required to be reported by the federal statutes or as directed in permits, the laws are aimed at protecting any other information generated by the environmental audit, even if it may apply in an enforcement action.(47) While EPA is willing to voluntarily restrain itself from requesting environmental audits in most cases, it still reserves authority to request them if necessary.(48) Therefore, these state privileges directly conflict with EPA's authority.(49)

Regulators in states with these privileges are now limited by their own state's procedural and evidentiary rules. However, EPA, which exercises concurrent jurisdiction, can step in and assert its authority in federal court.(50) Setting aside the policy issues of EPA's desire or ability to handle the extra burden of conducting investigations in such cases,(51) an interesting procedural and evidentiary question is posed. What impact will these state privilege laws have when EPA seeks access to environmental audits under its statutory authority to collect environmental information in a federal proceeding?(52)

III. How Federal Courts Apply Privileges

A federal court would first determine if it must apply the state's privilege law for environmental audits or the federal common law of privilege. Rule 501 of the Federal Rides of Evidence governs the use of privileges in federal proceedings. It requires federal courts to "govern by the principles of the common law as they may be interpreted by the courts of the United States in the light of reason and experience."(53) Although the Advisory Committee originally proposed thirteen specific privilege rules based on prior common law in the Preliminary Draft of the Evidence Rules, Congress rejected them all.(54) Instead, Congress adopted Rule 501 with a general standard to give federal courts flexibility in deciding when to develop new federal common law privileges.(55)

However, Rule 501 also requires federal courts to apply state privileges in certain circumstances. The Rule provides "in civil actions and proceedings, with respect to an element of a claim or defense as to which state law supplies the rule of decision, the privilege of a witness, person, government state, or political subdivision thereof shall be determined in accordance with state law.(56) This exception, known as the State Law Proviso, was intended to ensure sovereignty of state law in substantive areas, in accordance with the Erie doctrine.(57) Thus, in a federal diversity case, state privilege law will generally apply unless the litigants have a claim or defense that is based on federal law, in which case the federal common law of privilege governs.(58) A tougher question arises when it is a diversity case based on a federal question, but there are pendant state claims.(59) Then the federal court must decide if it will apply federal common law across the board or attempt to separate the claims and apply state and federal privilege law concurrently.(60)

In straight federal question cases, however, federal judges are not bound by state privilege law.(61) Justice Robert H. Jackson, concurring in the opinion in D'Oench, Duhme & Co. v. FDIC,(62) which centered on the conflict between state and federal law, eloquently stated, "[f]ederal law is no juridical chameleon, changing complexion to match that of each state wherein lawsuits happen.... Federal common law implements the federal Constitution and statutes, and is conditioned by them."(63) Therefore, since EPA will gain access to federal court based on federal question jurisdiction when seeking to enforce its statutory right to request a company's environmental audit, the federal common law of privileges should apply.(64)

IV. ENVIRONMENTAL AUDITS AND CURRENT COMMON LAW PRIVILEGES

A federal court must then decide how to apply the federal common law of privileges to environmental audits. Logically, the court would first refer to the currently established body of federal common law privileges. Three traditional common law privileges are sometimes used to try to protect environmental audits: 1) the attorney-client privilege, 2) the attorney work-product doctrine, and 3) the self-evaluative privilege.

A. Attorney-Client Privilege

The attorney-client privilege offers very little protection for environmental audits unless they are carefully drafted and distributed.(65) Although the attorney-client privilege was one of the specific federal privileges Congress rejected when passing the Federal Rules of Evidence,(66) Courts have still upheld it as a common law privilege to protect communications between attorneys and their clients.(67) It was developed to ensure complete disclosure from clients to attorneys so that attorneys can provide informed legal advice to their clients.(68) It only applies, however, to confidential disclosures between attorneys and their clients made specifically to obtain legal advice.(69) Further, the privilege only covers the communication and does not protect the underlying facts.(70)

The attorney-client privilege usually does not work for environmental audits because the audits are not typically conducted as confidential disclosures between an attorney and client to obtain legal advice. In addition, even when an attorney is a member of the audit team, environmental audits may still not be covered by the privilege. In United States v. Chevron U.S.A., Inc.,(71) for example, Chevron was trying to invoke the attorney-client privilege to protect an environmental audit.(72) The audit was prepared by a three-person team, which included an attorney, to assess a refinery's compliance with environmental laws.(73) The district court judge ruled Chevron could not invoke the privilege merely because an attorney was a member of the audit team.(74) The court stated: "The communication must be between the client and attorney in his or her capacity as an attorney rather than as, for example, a business advisor. Additionally, the communication's primary purpose must be to gain or provide legal assistance."(75)

In contrast, in California a federal magistrate in Olen Properties Corp. v. Sheldahl, Inc.(76) did apply the attorney-client privilege to an environmental audit.(77) This audit, however, was specifically prepared by an individual to gather information for a company's attorneys so they could evaluate the company's compliance with relevant environmental laws.(78) Since the audit was prepared only for the attorneys, to gain an opinion of law regarding the company's compliance, the magistrate held the audit was privileged.(79)

The end result is that the attorney-client privilege does not offer much protection to environmental audits, unless the audit is extremely limited in scope and purpose. Companies argue that the requirements necessary to invoke this privilege will limit an audit's effectiveness.(80) Additionally, if lawyers must be directly involved to invoke the privilege, it increases the cost and limits small companies' ability to audit.(81)

B. Attorney Work-Product Doctrine

The attorney work-product doctrine is more encompassing than the attorney-client privilege, but it also has some inherent limits for environmental audits. While the attorney-client privilege focuses on protecting confidential communications, the attorney work-product doctrine shields papers and other materials generated for the attorney's use while preparing for litigation.(82) The central policy behind the doctrine is the attorney's need to perform certain duties while preparing for trial without constant fear of exposure to the opposing party.(83)

The doctrine is limited, however, and only protects documents that contain information prepared in expectation of litigation.(84) This doctrine can also be overcome by a showing that the information is of value to the opposing party and cannot be easily attained elsewhere.(85)

It is difficult to protect environmental audits under U& doctrine because of the "preparation for litigation" requirement and the exclusion of documents prepared on a routine basis.(86) Ideally, an environmental audit is performed routinely to ensure compliance with environmental standards. If a company only performs an audit in preparation for a potential lawsuit, the preventive value of the audit has been lost.

C. Self-Evaluative Privilege

The self-evaluative privilege is the most likely common law privilege to offer protection for environmental audits.(87) This privilege protects documents prepared during a voluntary self-evaluation of a company's practices or procedures.(88) The underlying policy reason for the privilege is to further the public interest by encouraging the free flow of information within an organization, without fear of disclosure and liability in certain circumstances.(89) The self-evaluative privilege was first recognized in a medical malpractice suit, grand" protection to a hospital review committee's reports that critically evaluated the hospital's care of patients.(90)

Courts have not universally accepted or defined the self-evaluative privilege.(91) Courts that do recognize it, however,usually consider three main factors before allowing the privilege.(92) First, the information must be the result of a self-critical analysis by the party seeking protection.(93) Second, there must be a strong public policy reason to keep the flow of information open.(94) Third, the information must be the kind whose flow would be curtailed if the privilege did not apply.(95) Another requirement sometimes attached is that the report be prepared with the expectation of confidentiality.(96)

The self-evaluative privilege has several other limitations. It is considered a qualified privilege. Therefore, if the party seeking the information can show extraordinary need for the information, the privilege dissolves.(97) The privilege has also been overwhelmingly rejected when a federal agency is seeking the information.(98) When Congress provides an agency with strong investigative power and access to information, courts usually decide Congress has already spoken on the policy issue in favor of disclosure.(99)

This privilege has met strong resistance when applied to environmental documents.(100) In United States v. Dexter Corp.,(101) the district court refused to grant the privilege to protect self-evaluative documents relating to a company's compliance with the Clean Water Act.(102) The court reasoned that Congress made an implicit declaration that no hazardous substances should be discharged into the waters of the United States.(103) Therefore, any privilege shielding documents that might disclose a violation of this policy to EPA, which enforces the policy, would go against congressional intent.(104) Similarly, a district court in Pennsylvania held that environmental reports and memoranda should always be subject to release.(105) The court reasoned that companies still have a large enough incentive to perform reviews, even without a privilege, to avoid penalties and criminal actions.(106)

Only one court has held that the self-evaluative privilege applies to environmental audits.(107) In Reichhold Chemicals, Inc. v. Textron, Inc.,(108) a district court judge in Florida reasoned that the public interest in promoting voluntary self-assessments of environmental risks outweighed the opposing party's need for the evidence in private, civil litigation.(109)

The ruling, however, should be limited to its facts for two reasons. First, the judge only balanced the need of private litigants to the information, not a government agency's need. Second, the judge held the privilege applies only to "retrospective analysis of past conduct," not to evaluations of potential environmental risks made prior to adopting a course of action.(110)

V. Should Courts Create a New Federal Law Privilege for

Environmental Audits?

Although environmental audits do not fit squarely into any currently recognized federal common law privilege, Federal Rule of Evidence 501 still allows federal courts to adopt a new privilege for environmental audits.(111) Congress intentionally rejected specific rules of privileges in order to allow courts the flexibility to create new privileges in the future,(112) "governed by the principles of common law as they may be interpreted ... in the light of reason and experience."(113)

The U.S. Supreme Court has stated that before creating a new privilege, courts should balance the interests supporting the need for confidentiality against the policy for complete disclosure of relevant facts.(114) In Trammel v. United States,(115) the Court was reexamining a federal privilege that allowed an accused spouse to block adverse testimony by the other spouse.(116) This privilege went beyond the confidential marital communications privilege, because it protected any criminal acts and communications made in the presence of third parties.(117) After reviewing testimonial privileges given to priests, attorneys, and physicians, the Court concluded no other privilege granted such broad protection.(118) While the other privileges merely sought to foster trusting relationships by preventing testimony about confidential communications, this spousal privilege also encompassed acts and nonconfidential communications.(119) The Court found the ancient foundations and modern justifications for the privilege were no longer valid. A woman was no longer considered a chattel or denied a separate legal identity.(120) Additionally, justifying excluding such testimony to foster the harmony of the marriage seemed pointless since it was likely the relationship was beyond repair if one spouse was willing to adversely testify against the other.(121) Therefore, after balancing the reason for the privilege against the burden it placed on the criminal justice system, the Court modified the privilege. The witness-spouse could refuse to testify, but the accused spouse could no longer use the privilege to block adverse testimony.(122)

Underlying this balancing test is the notion that privileges are to be created and used sparingly, because they undermine the fundamental principle and maxim that "the public . . . has a right to every man's evidence."(123) In Nixon v. United States,(124) President Nixon tried to invoke an executive privilege to avoid turning over tapes and documents requested by a federal district court.(125) The Supreme Court recognized a presumption of privilege for the Chief Executive as "fundamental to the operation of Government and inextricably rooted in the separation of powers under the Constitution."(126) However, the Court still refused to apply this privilege after balancing the reason for the privilege against the needs of the judicial process: "[E]xceptions to the demand for every man's evidence are not lightly created nor expansively construed, for they are in derogation of the search for truth."(127) An additional consideration in the balancing test is the existence of a state privilege law. While federal courts deciding a federal question case are not bound by state privileges,(128) they can still consider the state law when deciding whether or not to create a new federal common law privilege.(129) In Memorial Hospital for McHenry County v. Shadur,(130) the hospital was seeking to vacate a district court's discovery order requiring it to turn over disciplinary proceedings documents.(131) While an Illinois statute provided a privilege for such documents, the district court refused to recognize it because the principal claim in the case arose under federal law.(132) The Seventh Circuit upheld the district court's refusal to apply the state privilege in federal court. In doing so, however, the Seventh Circuit still noted the importance of carefully considering the state privilege, because when a state "holds out the expectation of protection to its citizens, they should not be disappointed by a mechanical and unnecessary application of the federal rule."(133)

Similarly, the Fifth Circuit, in ACLU of Mississippi, Inc. v. Finch,(134) agreed that when a state legislature creates a privilege, the policies behind it should be balanced "against the policies favoring disclosure."(135) A state privilege law is not dispositive, however, and "will not often of itself justify a federal court in applying that privilege."(136) The State of Mississippi had created an evidentiary privilege for documents of the Sovereignty Commission, which the plaintiffs alleged was a cover organization for illegal surveillance and harassment.(137) Files and records of this commission constituted primary evidence for the plaintiffs' civil rights case.(138) The defendants argued that the policies behind the state privilege were strong enough to justify a similar federal common law privilege "in light of reason and experience."(139) While the Fifth Circuit acknowledged the need to consider the reasons for the state privilege, it found it unlikely to prevail in federal question cases, especially those based on civil rights law, where the federal interest in seeking the truth is so high.(140)

No federal court has decided how state environmental audit privileges will be handled in federal court. On balance, however, the strong federal interest in obtaining environmental information and the general policy against privileges should outweigh the policy reasons given for such privileges.

First, Congress has plainly granted EPA broad access to all relevant information needed to enforce the environmental statutes.(141) As the Supreme Court has noted, "[w]e are especially reluctant to recognize a privilege in an area where it appears that Congress has considered the relevant competing concerns but has not provided the privilege itself."(142) While the legislative history of the environmental statutes does not show that Congress specifically considered privileges for environmental documents, the language of the statutes indicates congressional intent to give EPA, and states in some cases, access to all relevant information to enforce the laws.(143) A comparison can be drawn between language used in the environmental laws information-gathering clauses and language in the Internal Revenue Code (IRC).(144) The IRC authorizes the Secretary or a delegate access to "books, papers, records, or other data ... as may be relevant or material" to determine correctness of income tax returns.(145) When balancing a request for an evidentiary privilege against an Internal Revenue Service (IRS) request for information as authorized in the IRC, the Second Circuit in United States v. Noall(146) held that when Congress has already spoken on the policy issue, courts should not second guess its reasoning.(147) In Noall, the IRS was seeking enforcement of a summons requesting a company's internal audit for an investigation of the company's previous income tax returns.(148) The company sought a self-evaluative privilege for these internal audits because they were only being used to ensure internal compliance with accounting practices.(149) The company argued that release of such materials would violate the public policy of self-critical analysis and cited several nontax cases where internal reports were protected.(150) The Second Circuit distinguished all of those cases, however, because in none of them had Congress already answered the policy issue by specifically granting the government access to the information, as it did in the tax code.(151) A comparable analysis and result should be made concerning the clauses in environmental laws that grant EPA access to information.

Similar logic was used in United States v. Dexter,(152) where a federal court did not apply the self-critical privilege to environmental documents because Congress had already declared what was in the public's interest when writing the environmental laws.(153) "A court should take cognizance," the court cautioned, "in an action brought by the United States to enforce duly enacted laws, of Congress's role in declaring what is in the public interest."(154) The court was referring to the Clean Water Act's general policy against "discharges of oil or hazardous substances into or upon the navigable waters of the United States."(155) Since a privilege for environmental documents would impede EPA's ability to enforce the Clean Water Act, the court ruled it would be contrary to public policy.(156)

Second, EPA is exercising its investigative power as an administrative agency when seeking environmental audit information. When Congress grants an administrative agency power to investigate, courts have ruled against privileges that may impede the agency's investigation.(157) For example, in Federal Trade Commission V. TRW, Inc.,(158) the Federal Trade Commission (FTC) was seeking enforcement of a subpoena for certain internal audit documents from a national credit reporting agency.(159) Since the Fair Credit Reporting Act(160) gave FTC the powers to enforce compliance with its requirements and to investigate noncompliance, the District of Columbia Circuit Court of Appeals refused to invoke the self-evaluative privilege against this request.(161) The court stated that "the `very backbone' of an administrative agency's effectiveness in carrying out the congressionally mandated duties of industry regulation is the rapid exercise of the power to investigate."(162) Since the environmental statutes provide the EPA Administrator with comparable investigatory and enforcement powers,(163) federal courts should similarly deny a privilege that blocks EPA's access to relevant information.

Third, the privilege is also not absolutely necessary to encourage companies to conduct environmental audits. When there are other strong incentives for companies to continue their practices, despite the risk of harm from disclosure, courts are reluctant to grant a privilege.(164) Indeed, companies have a large incentive to audit regularly, even without a privilege, to avoid heavy civil and criminal liability under the various environmental laws. A district court in Pennsylvania held that the self-evaluative privilege should not apply to environmental reports because the purpose behind the privilege, to encourage companies to act responsibly, is not needed in environmental cases.(165) The court "disagreed that a corporation would face a Hobson's choice between due diligence and self-incrimination in the tightly-regulated environmental context .... We doubt that today potential polluters will violate regulations requiring environmental diligence for fear of these documents being used against them tomorrow."(166) Therefore, the fact that the "societal gain" from auditing may be encouraged through other means weighs against a new privilege.

EPA's final policy on environmental audits further reduces the need to create a new evidentiary privilege.(167) EPA is attempting to encourage companies to audit by voluntarily limiting its use of such information in most cases, while still maintaining statutory authority to access the information when absolutely necessary.(168) EPA also eliminated the gravity-based civil penalties when violations are self-discovered through an audit and reported to EPA.(169) This policy offers an alternative to a new statutory or federal common law privilege since it provides for protection of companies who act in good faith, without providing a blanket shield for "bad actors." It provides some protection of the information to achieve the public policy goal of a clean environment, without completely undermining congressional intent to allow EPA to enforce the law. In light of the preference against privileges,(170) courts should favor this middle-ground policy over a new evidentiary privilege.

Finally, there is a pervasive theme throughout the environmental legislation favoring disclosure of environmental information to the public.(171) A privilege would prevent release of relevant environmental information not only to EPA, but also to the public at large.(172) One court concluded that this fact weighed heavily against allowing a privilege for environmental documents.(173) Since Congress has plainly stated what is in the public interest -- to have access to pertinent environmental documents -- courts should avoid creating a privilege that circumvents this intent.

Advocates who want to create a new federal common law privilege for environmental audits rely on the fact that several state legislatures have passed environmental audit privilege laws.(174) They argue that the state legislatures have already weighed the policy issues and found a significant public interest in protecting the audits.(175) Since the privilege encourages voluntary compliance with environmental laws, the legislatures have reasoned that the privilege encourages voluntary compliance with environmental laws, which is in the public's best interest.(176) In addition, since regulatory authorities still have access to information specifically required by law, a privilege for the audits will not significantly hamper the public's interest in full and complete disclosure of relevant facts.(177) However, while it is relevant that some state legislatures have granted a privilege for environmental audits, it is not decisive.(178) In addition, some state legislatures have considered the issue and have rejected a privilege or delayed action on the proposed laws.(179)

Privilege proponents also argue that a lack of privilege will hamper the entire audit process, which both EPA and DOJ have recognized as a valuable tool to achieve environmental compliance.(180) Companies suggest that without a guarantee that the information will not be used against them, the audits' utility will be reduced as companies attempt to avoid risk of exposure.(181) Similarly, companies fear that an aggressive audit program will only make them look bad in the long run by exposing their weaknesses to inspectors.(182) The new EPA auditing policy, however, seems to undercut most of these arguments by offering significant benefits for companies who audit in good faith.(183)

The Reichhold Chemicals, Inc. v. Textron, Inc.(184) decision also supports the proposition that environmental audit privileges are in the public interest.(185) The judge ruled the self-evaluative privilege applies to environmental audits because "it is self-evident that pollution poses a serious public health risk, and that there is a strong public interest in promoting voluntary identification and remediation of industrial pollution.(186) It is important to note, however, that the judge was only protecting analysis of past conduct, not assessment of potential environmental risks.(187) It was also only a civil litigation lawsuit where private parties were seeking the information, not a government agency acting under its statutory authority. This significantly limits the impact of the case as it relates to the application to environmental audit privileges seeking to shield information from government agencies.

VI. Conclusion

Voluntary environmental audits are undoubtedly an effective way for companies to assess compliance with the law, but they also create some inherent risks. The state evidentiary privileges for environmental audits may encourage more audits by minimizing the risk of exposure. Such privileges, however, directly conflict with federal environmental statutes that authorize EPA access to any environmental information needed to enforce the laws. Although these state privileges are not binding on federal courts, judges will certainly consider them when deciding if environmental audits should receive protection under the federal common law of privilege.

In light of the policy against creating new privileges, it is unlikely federal courts will adopt a new federal common law privilege for environmental audits. Congress has expressed its intent to give EPA broad access to environmental information when pursuing enforcement actions. Additionally, Congress has required that such information be available to the public. Shielding relevant environmental information with an audit privilege runs counter to Congress's goals. Therefore, the state evidentiary privileges for environmental audits should not block EPA from accessing relevant information pursuant to its statutory authority in federal court.

Instead of adopting a new privilege, federal courts should recognize that EPA's final policy for voluntary self-disclosure of environmental audits offers a preferred middle ground by granting protection to companies auditing in good faith, while refusing to give blanket protection to bad actors. This should encourage continued self-inspection with environmental audits without violating the policy against creating new federal common law privileges.

(1) Clinton J. Elliott, Kentucky's Environmental Self-audit Privilege. State Protection or Increased Federal Scrutiny?, 23 N. Ky. L Rev. 1, 7-8 (1995); see also John Davidson, Privileges for Environmental Audits: Is Mum Really the Word?, 4 S.C. Envtl. L.J. 111, 111-12 (1995) (listing the major environmental laws).

(2) Mia Anna Mazza, The New Evidentiary Privilege for Environmental Audit Reports: Making the Worst of a Bad Situation, 23 Ecology I.Q. 79, 80-81 (1996).

(3) EPA Environmental Auditing Policy Statement, 51 Fed Reg. 25,004, 25,004 July 9, 1986) [hereinafter Policy Statement].

(4) Mazza, supra note 2, at 82; Elliott, supra note 1, at 3.

(5) See James T. O'Reilly, Environmental Audit Privileges: The Need for Legistative Recognition, 19 Seton Hall Legis. J. 119, 135 (1994).

(6) See id. at 132; Jim Moore, A Response to "The Case Against an Environmental Audit Privilege," Nat'l Envtl. Enforcement J., Dec. 1994/Jan. 1995, at 3, 9.

(7) See infra Part IV.

(8) Craig N. Johnston, An Essay on Environmental Audit Privilege: The Right Problem, the Wrong Solution, 25 Envtl. L. 335, 335-36 (1995).

(9) See infra notes 30-35 and accompanying text.

(10) See, e.g., Clean Air Act [sections] 114,42 U.S.C. [sections] 7414 (1994) (providing that reports generated under these provisions be made available to EPA, as well as to the public); Federal Water Pollution Control Act Amendments of 1972 (Clean Water Act) [sections] 308, 33 U.S.C. [sections] 1318 (1994) (same); Resource Conservation and Recovery Act (RCRA) [sections] 3007, 42 U.S.C. [sections] 6927 (1994) (same). The state privileges also conflict with RCRA's express mandate to provide information to "any duly authorized officer, employee or representative of a state having an authorized hazardous waste program." 42 U.C.S. [sections] 6927(a) (1994). Also, the privileges arguably conflict with the Clean Water Act's requirement for states with authorized programs to have the same access to information authorized in section 308. 33 U.S.C. [sections] 1318(c) (1994).

(11) See infra notes 128-140 and accompanying text.

(12) Elliot, supra note 1, at 6-7.

(13) Enforcement: Companies Would Perform More Audits if Penalties Were Eliminated, Survey Says, 25 Env't Rep. Current Developments (BNA) 2441, 2447-48 (Apr. 14, 1995). A 1995 survey of companies by the Price Waterhouse Environmental Services Group found 75% of companies who responded have been conducting some type of environmental audit since 1988. Id. It should be noted the survey was sent to 1800 firms and only 369 responded. Of those responding, 258 replied they audit regularly. Id.

(14) Policy Statement, supra note 3, at 25,006.

(15) Ark Code Ann. [sections] 8-1-302(3)(A) (Minchie Supp. 1995); 415 Ill. Comp. Stat. Ann. 5/52.2(i) (West Supp. 1996); Ky. Rev. Stat. Ann. [sections] 224.01-040(1)(a) (Mechie 1995); Or. Rev. Stat. [sections] 468.963(6)(a)(1995); Wyo. Stat. Ann. [sections] 35-11-1105(a)(i) (1977).

(16) S. 582, 104th Cong. (1995); H.R. 1047, 104th Cong. (1995); see also David R. Erickson & Sarah D. Mathews, Environmental Compliance Audits: Analysis of Current Law, Policy, and Practical Considerations to Best Protect Their Confidentiality, 63 UMKC I. Rev. 491, 492-93 n.4 (1995) (discussing the proposed legislation). See generally O'Reilly, supra note 5, at 119-22 (offering a general description of environmental audits).

(17) John F. Cooney et al., Criminal Enforcement of Environmental Laws: Part III -- from Investigation to Sentencing and Beyond, 25 Envtl. L Rep. News & Analysis (Envtl. L. Inst.) 10,600, 10,602 (Nov. 1995); Elliott, supra note 1, at 8-9; Mazza, supra note 2, at 86.

(18) Policy Statement, supra note 3, at 25,006; see also O'Reilly, supra note 5, at 128 discussing EPA's policy).

(19) Incentives for Self-Policing: Discovery, Disclosure, Correction and Prevention of Violations, 60 Fed. Reg. 66,706, 66,707 (Dec. 22, 1995) [hereinafter Incentives]. This policy was the result of an extensive review, conducted throughout 1994 and 1995, to detemine whether additional incentives would encourage more voluntary disclosures discovered during environmental audits. Id. EPA sought information from a variety of interest groups to establish an interim policy, which was released on April 3, 1995. Voluntary Enviromnental Self-Policing and Self-Disclosure Interim Policy Statement, 60 Fed Reg. 16,875, 16,976 Apr. 3, 1995). After considering public comment and further input from interest groups, EPA released its finalized version of the policy in December 1995. See also Michael Moore, final EPA Policy on Voluntary Audits Draws Praise, Criticism, Daily Env't Rep. (BNA), *1-*11 (Jan. 12, 1996), available in WESTLAW, BNA-DEN database (discussing the pros and cons of the new policy).

(20) Incentives, supra note 19, at 66,707. Companies who do not audit, but voluntarily discover and report a violation, will potentially receive a 75% reduction of gravity-based civil penalties. Id. This reserves the best advantage to those companies who actually perform environmental audits. Id.

(21) Id.

(22) Factors in Decision on Criminal Prosecutions for Environmental Violations in the Context of Significant Voluntary Compliance or Disclosure Ffforts by the Violator, reprinted in 21 Envtl. L Rep. (Envtl. L Inst) 35,399, 35,399 July 1, 1991), available in WESTLAW, ELR-ADMIN Database. See generally Thomas L. Weisenbeck & Ritaelena M. Casavechia, Guidelines for Self-Reporting and Self-Auditing, 22 Env't Rep. (BNA) 2481, 2481 (Mar. 6, 1992) (discussing the DOJ policy); Erickson & Mathews, supra note 16, at 505 (outlining the DOJ policy).

(23) Thomas McMahon, Criminal Enforcement of Environmental Laws, 474 Practicing Law Inst., Litig. & Admin. Prac., 319, 323 (Sept-Oct. 1993), available in WESTLAW, Practicing Law Institute (PLI) Database.

(24) Erickson & Mathews, supra note 16, at 503-04.

(25) Moore, supra note 6, at 6. This claim, however, appears to be largely unsubstantiated. A 1995 survey of all states by the National Association of Attorneys General revealed only one civil penalty case where information from a company's voluntarily conducted environmental self-audit was used against it and only two such cases in the criminal enforcement context. David Ronald, The Case Against an Environmental Audit Privilege, Nat'l Envtl. Enforcement J., Sept. 1994, at 3, 4.

(26) Moore, supra note 6, at 6. EPA's new policy, however, seems to undermine this argument with opportunities for penalty mitigation, although it is still not guaranteed in all cases of self-disclosure.

(27) See, e.g., O'Reilly, supra note 5, at 127 (listing the "chilling effects" on audits without privileges, such as the following: fewer internal activities will be examined, fewer types of investigations will be conducted, less critical analysis will be included, fewer corrective plans will be developed, less openness with management about past practices will be encouraged, fewer results will be widely distributed, and analyses will be retained for a shorter period). See also Cooney et al., supra note 17, at 10,602 (stating that the public suffers if auditing is discouraged).

(28) Enforcement: Companies Would Performed More Audits If Penalties Were Eliminated, Survey Says, 25 Env't Rep. (BNA) 2447 (Apr. 14, 1995). However, only 20% of the companies who responded to the survey listed "fear of enforcement" as their reason for not auditing. Id. Also, this survey was conducted before EPA implemented the policy to reduce gravity-based civil penalties for companies who conduct audits and self-report violations. Id.

(29) Companies Say EPA Enforcement Policy Collides with Voluntary Audit Programs, 117 Daily Rep. For Executives (BNA), at d27, d27 (June 21, 1994); Annette Crawley, Environmental Auditing and the "Good Samaritan" Doctrine: Implications for Parent Corporations, 28 GA. L. Rev. 223 (1993); Davidson supra note 1, at 112. This contention has been dismissed by at least one commentator as "largely Illusory." See Johnston, supra note 8, at 346.

(30) See Moore, supra note 19, at 9; Erickson & Mathews, supra note 16, at 493.

(31) Or. Rev. Stat. [sections] 468.963 (1995).

(32) Colo. Rev. Stat. Ann. [sections] 13-25-126.5 (West Supp. 1995); 415 Ill. Comp. Stat. ANN. 5/52.2 (West Supp. 1996); Ind. Code. Ann. [subsections] 13-10-3-1 to 13-20-3-12 (Michie 1996) (repealed 1996); Ky. Rev. Stat. Ann. [sections] 224.01-040 (Michie 1995).

(33) Environmental Audits: State Privilege Legislation Multiplies in 1995; Predictions Differ About 1996, Dally Env't Rep. (BNA) *1 (Aug. 29 1995), available in WESTLAW, BNADEN database.

(34) Patricia E. O'Toole, State Legislation on Audit Privilege, Envtl. F., May-June 1995, at 18-19 (Arkansas, Idaho, Kansas, Mississippi, Utah, Virginia, Wyoming); Tex. Civ. Code Ann. [sections] 4447cc (West 1996); Environmental Improvement Pilot Program, ch. 168, [sections] 3, 1995 Min. Laws 168 (West) (to be codified at Minn. Stat. Ann. [subsections] 114C.20-114C.33).

(35) Environment Audit Privilege and Voluntary Disclosure Act, ch. 57, 1996 S.C. Acts 384 (West) (to be codified at S.C. Code Ann. [subsections] 48-57-10 to 48-57-110); N.H. Rev. STAT. ANN. [section] 147-E (1996 Advanced Legislative Service No. 1); 1996 Mich. Pub. Acts 132 (to be codified at Mich. Comp. Laws [sections] 324.100-324.90106).

(36) See O'Toole, supra note 34, at 18-19 (listing states that considered but failed to pass privilege laws in 1995); EPA's State Audit Privilege and Immunity Legislation Update (on file with author) (listing 16 states that failed to enact environmental audits or immunity bills during the 1996 legislative session).

(37) Ark. Code. Ann. [section] 8-1-301 (Michie 1987).

(38) 42 U.S.C. [subsections] 7401-7671 (1994).

(39) Id. [sections] 7414.

(40) Federal Water Pollution Control Act Amendments of 1972 (CWA), 33 U.S.C. [subsections] 1251-1387 (1994).

(41) Id. [sections] 1318(a) ("Whenever required to carry out the objective of this chapter, including ... determining whether any person is in violation of any such effluent limitation ... the Administrator shall require the owner or operator of any point source to ... provide such other information as he may reasonably require ....").

(42) 42 U.S.C. [subsections] 6901-6992k (1994).

(43) Id. [sections] 6927(a).

(44) Id. [sections] 6927(b)(1); Clean Air Act, 42 U.S.C. [sections] 7414(c) (1994); CWA, 33 U.S.C. [sections] 1318(b) (1994).

(45) See, e.g., 40 C.F.R. [sections] 123.26 (1995) (listing requirements for state water programs); 40 C.F.R. [sections] 271.15 (1995) (listing requirements for state hazardous waste programs).

(46) See, e.g., 33 U.S.C. [sections] 1342(b)(2)(B) (1994) and 40 C.F.R. [sections] 123.26(c) (1995) (water programs); 42 U.S.C. [sections] 6926(b) (1994) and 40 C.F.R. [sections] 271.15(c) (1995) (hazardous waste programs). EPA Administrator Caroline Browner has suggested that because, these state privilege laws can be more protective than federal environmental regulations or standards, states with these laws may lose their federally delegated environmental programs. Erickson & Mathews, supra note 16, at 513.

(47) See, e.g., Ark Code. Ann. [sections] 8-1-303(b), 8-1-305 (Michie 1987); Wyo. Stat. Ann. [sections] 35-11-1105(c), 35-11-1105(d) (Michie 1977). However, many of the privilege laws also appear to exclude any "other information" that is required to be provided to a regulatory agency in accordance with a federal law, regulation, or permit. Ark. Code. Ann. [sections] 8-1-305 (Michie 1987); Wyo. Stat. Ann. [sections] 35-11-1105(d) (Michie 1977); Or. Rev. Stat. [sections] 468.963(5)(a) (1995); Ky. Rev. Stat. Ann. [sections] 224.01-040(6)(a) (Michie 1995); Colo. Rev. Stat. Ann. [sections] 13-25-126.5(4)(b) (West Supp. 1995). Therefore, arguably state privilege laws do not even apply when EPA is seeking information under its statutory authority because EPA is acting pursuant to federal law. See supra notes 38-43 and accompanying text. The same argument can be made for state agencies acting under EPA-authorized programs that require them to have access to the same information as EPA, See supra notes 45-46 and accompanying text.

(48) Incentives, supra note 19, at 66,708 (1995); Davidson, supra note 1, at 113-14.

(49) EPA is opposed to these privilege laws and makes clear in its final policy that it intends to closely scrutinize states with audit privileges. See Erickson & Mathews, supra note 16, at 512.

(50) Incentives, supra note 19, at 66,712. See also 33 U.S.C. [subsections] 1319(a)(1)-1319(b), 1342(i) (1994) (CWA provisions); 42 U.S.C. [sections] 6928(a) (1994) (RCRA provisions); 42 U.S.C. [sections] 7413(a) (1994) (Clean Air Act provisions).

(51) Virginia M. Creighton, Colorado's Environmental Audit Privilege Statute: Striking the Appropriate Balance?, 67 U. Colo. L. Rev. 443, 468 (1996).

(52) This question may be preempted if the pending federal legislation is passed before it is sorted out in the judicial system Currently two bills have been introduced, but are still in committee. See supra note 16 and accompanying text.

(53) Fed. R. Evid. 501. The standard was derived from Rule 26 of the Federal Rules of Criminal Procedure. H.R. REP. No. 93-650, at 8 (1973), reprinted in 1974 U.S.C.C.A.N. 7075, 7082. This was a compromise position adopted at the suggestion of Judge Friendly. 23 Charles A. Wright & Kenneth W. Graham, Jr., Federal Practice and Procedure [sections] 5421 (1980).

(54) 23 Wright & Graham, supra note 53, [sections] 5421; H.R. REP. No. 93-650, at 8, reprinted in 1974 U.S.C.C.A.N. at 7082.

(55) Trammel V. United States, 445 U.S. 40, 47 (1980); University of Pa. v. EEOC, 493 U.S. 182, 189 (1990).

(56) FED. R. Evid. 501.

(57) The conference committee felt in such instances the federal interest could not be strong enough to outweigh the state's right to develop its own privilege policy. H.R. REP. No. 93-650, at 9. The Advisory Committee was seeking to exclude application of all state privilege law. This generated a huge controversy which forced Congress to develop a rule that accounted for state privileges in certain cases. 23 Wright & Graham, supra note 53, [sections] 5421. For more on the State Law Proviso, see id. [sections] 5432.

(58) H.R. Conf. Rep. No. 93-1597, at 7 (1974), reprinted in 1974 U.S.C.C.A.N. 7098, 7101; Sola Elec. Co. v. Jefferson Elec. Co., 317 U.S. 173 (1942).

(59) S. Rep. No. 93-1277, at 6 (1974), reprinted in 1974 U.S.C.C.A.N. 7051, 7053; 23 Wright & Graham, supra note 53, [sections] 5434.

(60) There is no set policy because, while the Senate Report tried to make it clear, the clarification was ultimately rejected by the Conference Report on Rule 501. See Hansen v. Allen Mem'l Hosp., 141 F.R.D. 115, 119-20 (S.D. Iowa 1992).

(61) 23 Wright & Graham supra note 53, [sections] 5432; H.R. Conf. Rep. No. 93-1597, at 7, reprinted in 1974 U.S.C.C.A-N. at 7101.

(62) 315 U.S. 447 (1942).

(63) Id. at 471-72; see also H.R. Conf. Rep. No. 93-1597, at 7, reprinted in 1974 U.S.C.C.A-N. at 7101 stating federal law should dictate in federal question cases).

(64) However, if the federal jurisdiction is based on diversity, and the audit is requested for toxic tort litigation or based on a citizen suit, the state privilege is likely to be recognized by the federal judge since it is a civil proceeding. O'Reilly, supra note 5, at 139.

(65) See Cooney et al., supra note 17, at 10,602-03 (discussing various difficulties in using the attorney-client privilege).

(66) 24 Wright & Graham, supra note 53, [subsections] 5471-5507.

(67) Upjohn Co. v. United States, 449 U.S. 383, 389 (1981). Actually, the attorney-client privilege is one of the oldest known privileges in the common law. 8 John Henry Wigmore, Wigmore on Evidence [sections] 2290 (McNaughton rev. 1961).

(68) Upjohn Co., 449 U.S. at 389; see also Trammel v. United States, 445 U.S. 40, 51 (1980).

(69) Fisher v. United States, 425 U.S. 391, 403 (1976); see also United States v. United Shoe Mach. Corp., 89 F. Supp. 357, 358-59 (D. Mass. 1950)(listing the specific factors necessary to invoke the attorney-client privilege).

(70) Upjohn Co., 449 U.S. at 395.

(71) No. CIV.A-88-6681, 1989 WL 121616 (E.D. Pa. Oct. 16, 1989).

(72) 72 Id. at (*)1-(*)2.

(73) Id. at (*)6.

(74) Id. at (*)6 (citing Super Tire Eng'g Co. v. Bandag Inc., 562 F. Supp. 439, 441 (E.D. Pa. 1983)).

(75) Id. at (*)6.

(76) No. CV 91-6446-WDK (Mcx) 94 WL 212135 (C.D. Cal. Apr. 12, 1994).

(77) Id. at (*)1.

(78) Id. at (*)1.

(79) Id. It appears the magistrate was considering the entire audit document as confidential communication to the attorneys. See id. While this protects the audit document itself, the underlying facts would still be discoverable through other means.

(80) Moore, supra note 6, at 9; see also O'Reilly, supra note 5, at 137 (mentioning the awkwardness of hiring outside audit firm to conduct the review to meet the privilege requirements). Additionally, environmental audits must be treated as confidential communication between the attorney and client to invoke the privilege. Id. at 136. Without the privilege, the distribution of the information and its use will be severely curtailed, thus limiting its effectiveness. Id. at 126-27 (listing "chilling effects" on audits without a privilege).

(81) Moore, supra note 6, at 9; see also O'Reilly, supra note 5, at 136-37 (suggesting a very high cost option of hiring two outside professionals to conduct and analyze the audit).

(82) Hickman v. Taylor, 329 U.S. 495, 510-11 (1947); Fed. R. Civ. P. 26(b)(3).

(83) Hickman, 329 U.S. at 510-11.

(84) Id. at 511-12.

(85) Id.

(86) See O'Reilly, supra note 5, at 138-39.

(87) This privilege has several different names, such as self-critical analysis privilege and self-evaluative report privilege, but courts recognize the same basic requirements. Peter A. Gish, The Self-critical Analysis Privilege and Environmental Audit Reports, 25 Envt'l. L. 73, 73 n.1 (1995). See generally Mazza, supra note 2, at 91-103 (providing a detailed history of the privilege's evolution).

(88) See Gish, supra note 87, at 82-83.

(89) Bredice v. Doctors Hosp., Inc., 50 F.R.D. 249, 251 (D.C. Cir. 1970), aff'd, 479 F.2d 920 (D.C. Cir. 1973).

(90) Id. at 251. The court ruled the public need for the best possible medical care out-weighed the need for access to the documents. Id. at 250-51. It reasoned that the confidentiality of such meetings was essential for a free flow of information, and this candidness was necessary to ultimately improve medical care. Id.

(91) Dowling v. American Haw. Cruises, Inc., 971 F.2d 423, 425 n. 1 (9th Cir. 1992) (stating that the Supreme Court and the circuit courts have neither accepted nor denied the existence of the privilege); Reichhold Chem., Inc. v. Textron, Inc., 157 F.R.D. 522, 524-25 (N.D. Fla. 1994) (reviewing previous decisions regarding the privilege). See also Ann C. Hurley, Environmental Audit Privileges: A Coverup, Not a Cure, Nat'l Envt'l Enforcement J., Feb. 1995, at 15, 16 (noting judicial trend toward narrowing evidentiary privileges).

(92) Note, The Privilege of Self-Critical Analysis, 96 Harv. L Rev. 1083, 1086 (1983).

(93) Id.

(94) Id.

(95) Id. See also Gish, supra note 87, at 80-82 (reviewing criteria used in evaluating the need for privilege).

(96) Dowling, 971 F.2d at 426.

(97) Bredice v. Doctors Hosp., Inc., 50 F.R.D. 249, 250-51 (D. D.C. 1970); Reichhold Chem., Inc. v. Textron, Inc., 157 F.R.D. 522, 526 (N.D. Fla. 1994).

(98) Federal Trade Comm'n v. TRW, Inc., 628 F.2d 207, 210 (D.C. Cir. 1980); United States v. Dexter Corp., 132 F.R.D. 8, 9 (D. Conn. 1990); see also Gish, supra note 87, at 84 n. 73 (citing additional cases).

(99) United States v. Noall, 587 F.2d 123, 126 (2d Cir. 1978). See also Hurley, supra note 91, at 16; Gish, supra note 87, at 84.

(100) See Gish, supra note 87, at 85; Hurley, supra note 91, at 16.

(101) 132 F.R.D. 8 (D. Conn. 1990).

(102) Id. at 8; see also Gish, supra note 87, at 84-85 (discussing the Dexter case).

(103) Dexter Corp., 132 F.R.D. at 9; see 33 U.S.C. [sections] 1321(b)(1) (1994).

(104) Dexter Corp., 132 F.R.D. at 9-10.

(105) Koppers Co. v. Aetna Casualty & Surety Co., 847 F. Supp. 360, 364 (W.D. Pa. 1994).

(106) Id.

(107) Reichhold Chem., Inc. v. Textron, Inc., 157 F.R.D. 522 (N.D. Fla. 1994). The judge adopted the Dowling court's four criteria to analyze if the self-evaluative privilege should apply. Id. at 526-27. He also rejected the defendant's reliance on Koppers Co., asserting that the privilege does not apply a fortiori to environmental assessments. Id. at 527.

(108) Id.

(109) Id. at 526. "The privilege protects an organization or individual from the Hobson's choice of aggressively investigating accidents or possible regulatory violations ... or deliberately avoiding making a record on the subject (and possibly leaving the public exposed to danger) in order to lessen the risk of civil liability." Id. at 524.

(110) Id. at 527.

(111) H.R. Rep. No. 93-650, at 8 (1973), reprinted in 1974 U.S.C.C.A.N. 7075, 7082; see also Trammel v. United States, 445 U.S. 40, 47 (1980) (suggesting that Congress did not want the law of privileges frozen); Gish, supra note 87, at 77 (stating that Congress intended the law of privileges to be flexible).

(112) H.R. Rep. No. 93-650, at 8, reprinted in 1974 U.S.C.C.A.N. at 7082.

(113) Fed. R. Evid. 501.

(114) Trammel, 445 U.S. at 51; see also Wigmore, supra note 67, [sections] 2285.

(115) 445 U.S. 40 (1980).

(116) Id.

(117) Id. at 51.

(118) Id. at 51.

(119) Id.

(120) Id. at 52.

(121) Id.

(122) Id. at 53.

(123) See United States v. Nixon, 418 U.S. 683, 709 (1974) (quoting United States v. Bryan, 339 U.S. 323, 331 (1950) (quoting Wigmore, supra note 67, at [sections] 2192)).

(124) Id. at 709.

(125) Id. at 703.

(126) Id. at 708.

(127) Id. at 710.

(128) See supra notes 61-63 and accompanying text.

(129) Memorial Hosp. for McHenry County v. Shadur, 664 F.2d 1058, 1061 (7th Cir. 1981); 23 Wright & Graham, supra note 53, [sections] 5432.

(130) 664 F.2d 1058 (7th Cir. 1981).

(131) Id. at 1059-60.

(132) Id. at 1060.

(133) Id. at 1061 (quoting Lora v. Board of Educ., 74 F.R.D. 565 (E.D.N.Y. 1977)).

(134) 638 F.2d 1336 (5th Cir. 1981).

(135) Id. at 1343.

(136) Id.

(137) Id. at 1338-39.

(138) Id. at 1339.

(139) Id. at 1342.

(140) Id. at 1343.

(141) See supra notes 38-43 and accompanying text.

(142) University of Pa. v. EEOC, 493 U.S. 182, 189 (1990).

(143) See supra notes 38-43 and accompanying text. The legislative history on the specific information-gathering clauses is very sparse.

(144) 26 U.S.C. [subsection] 1-1564 (1994).

(145) 26 U.S.C. [sections] 7602(a)(2) (1994).

(146) 587 F.2d 123 (2d Cir. 1978), cert. denied, 441 U.S. 923 (1979).

(147) Id. at 126.

(148) Id. at 124.

(149) Id. at 125.

(150) Id. at 126.

(151) Id. at 126. See also Federal Trade Comm'n v. TRW, Inc., 628 F.2d 207, 211 (D.C. Cir. 1980) (holding that credit reporting may not claim a "self-evaluative" privilege for a group of documents requested by a Federal The Commission subpoena).

(152) 132 F.R.D. 8 (D. Conn. 1990).

(153) Id. at 9-10.

(154) Id. at 9.

(155) 33 U.S.C. [sections] 1321(b)(1) (1994).

(156) Dexter Corp., 132 F.R.D. at 9.

(157) See, e.g., Fed. Trade Comm'n v. TRW, Inc., 628 F.2d 207, 210-211 (D.C. Cir. 1980); Emerson Elec. Co. v. Schlesinger, 609 F.2d 898, 906-07 (8th Cir. 1979); United States v. Noall, 587 F.2d 123-126 (2d Cir. 1978); Reynolds Metals Co. v. Rumsfeld, 564 F.2d 663, 667 (4th Cir. 1977), cert. denied, 435 U.S. 995 (1978).

(158) 628 F.2d 207 (D.C. Cir. 1980).

(159) Id. at 207-08.

(160) 15 U.S.C. [subsections] 1681-1681t (1994).

(161) Fed. Trade Comm'n, 628 F.2d at 210-211.

(162) Id. at 211 (quoting Federal Trade Comm'n v. Texaco, Inc., 555 F.2d 862, 872 (D.C. Cir. 1977) (quoting FMC v. Port of Seattle, 521 F.2d 431, 433 (9th Cir. 1975), cert. denied, 431 U.S. 974 (1977))).

(163) See supra notes 38-43 and accompanying text.

(164) See, e.g., Dowling v. American Haw. Cruises, Inc., 971 F.2d 423, 426 (9th Cir. 1992); Koppers Co. v. Aetna Casualty & Surety Co., 947 F. Supp. 360, 364 (W.D. Penn. 1994).

(165) Koppers Co., 847 F. Supp. at 364.

(166) Id.

(167) EPA's final policy on auditing makes clear it is opposed to evidentiary privileges as the solution and will closely monitor states who have such privilege laws. Erickson & Mathews, supra note 16, at 512-13.

(168) Incentives, supra note 19, at 66,708; Davidson, supra note 1, at 113-14.

(169) Incentives, supra note 19, at 66,707.

(170) See supra notes 123-27 and accompanying text; see also Incentives, supra note 19, at 66,709 (outlining EPA's opposition to a statutory privilege in light of preference against them).

(171) Clean Air Act [sections] 114, 42 U.S.C. [sections] 7414(c) (1994); Federal Water Pollution Control Act Amendments of 1972 (CWA) [sections] 308, 33 U.S.C. [sections] 1318(b) (1994); Resource Conservation and Recovery Act [sections] 3007, 42 U.S.C. [sections] 6927(b) (1994).

(172) Johnston, supra note 8, at 342.

(173) The "public need for disclosure of documents relating to environmental pollution and the circumstances of such pollution outweighs the public's need for confidentiality in such documents." Koppers Co. v. Aetna Casualty & Surety Co., 847 F. Supp. 360, 365 (1994) (quoting CPC Int'l Inc. v. Hartford Accident & Indem. Co., 620 A.2d 462, 467 (1992)).

(174) See O'Reilly, supra note 5, at 140. See also Oregon Experiments with Self-Evaluative Privilege by Enacting Law Shielding Environmental Audit Reports, Prevention of Corp. Liability (BNA) (Nov. 15, 1993).

(175) See O'Reilly, supra note 5, at 141-146.

(176) See supra note 37 and accompanying text.

(177) See supra note 47 and accompanying text.

(178) See supra notes 128-40 and accompanying text (discussing the impact of state privilege laws). This point should be especially clear since EPA, the agency tasked with enforcing the federal legislation, is against state audit privileges. EPA's final policy on environmental auditing states, "EPA remains firmly opposed to statutory environmental audit privileges that shield evidence of environmental violations and undermine the public's right to know ...." Incentives, supra note 19, at 66,712.

(179) See supra note 36.

(180) See supra notes 18-22 and accompanying text.

(181) Paul G. Wallach, EPA's Interim Audit Policy-The Critical Need for a Legislative Fix, 2 Wis. B. Envtl. L. News 14 (1995). See also O'Reilly, supra note 5, at 126-28 (discussing the "chilling effect").

(182) Moore, supra note 6, at 6.

(183) See supra notes 18-21 and accompanying text.

(184) Reichhold Chem., Inc. v. Textron, Inc., 157 F.R.D. 522 (N.D. Fla. 1994).

(185) Id. at 526

(186) Id. at 526.

(187) Id. at 527.