Quimbee logo
DMCA.com Protection Status

Schaeffler v. United States

806 F.3d 34 (2015)

Case BriefRelatedOptions
From our private database of 26,900+ case briefs...

Schaeffler v. United States

United States Court of Appeals for the Second Circuit

806 F.3d 34 (2015)

Facts

Shortly before the stock market collapsed in 2008, Georg Schaeffler and his three holding companies (the Schaeffler Group) (plaintiffs) made a tender offer to purchase an interest in a German company, Continental AG, and borrowed €11 billion from a consortium of banks to finance the purchase. Two days before the offer expired, Lehman Brothers announced bankruptcy, the stock market crashed, and the value of Continental AG shares plummeted. Because the Schaeffler Group could not withdraw its tender offer under German law, many more shareholders than expected or desired accepted the offer, leaving the Schaeffler Group holding nearly 90 percent of the outstanding stock. The transaction threatened to make the Schaeffler Group insolvent and unable to make its loan payments. The Schaeffler Group needed to restructure and refinance the debt, which substantially altered Mr. Schaeffler’s personal tax liability to the Internal Revenue Service (IRS) (defendant). Anticipating an audit, the Schaeffler Group retained accounting firm Ernst & Young (EY) and law firm Dentons U.S. LLP (Dentons) to provide advice on the tax implications and potential IRS litigation. Attorneys for the consortium who advised the Schaeffler Group how to restructure and refinance the acquisition needed to review confidential tax information and analysis to assess the consortium’s exposure for Mr. Schaeffler’s tax liabilities. The parties agreed that the Schaeffler Group should request a private letter ruling from the IRS and shared some core tax advice under a confidentiality agreement on issues the letter ruling did not address. The IRS began an audit and issued a summons for documents that EY had prepared and shared with anyone outside the Schaeffler Group and Dentons, including legal opinions related to the restructuring shared with the consortium attorneys. The Schaeffler Group petitioned to quash the request for legal opinions. The district court denied the petition to quash on the ground that the Schaeffler Group had waived attorney-client privilege by sharing the opinions with the consortium, reasoning that the common legal interest or joint-defense privilege exception did not apply as the consortium had only a commercial and not a common legal stake in Schaeffler’s potential litigation with the IRS. The Schaeffler Group appealed.

Rule of Law

Issue

Holding and Reasoning (Winter, J.)

What to do next…

  1. Unlock this case brief with a free (no-commitment) trial membership of Quimbee.

    You’ll be in good company: Quimbee is one of the most widely used and trusted sites for law students, serving more than 541,000 law students since 2011. Some law schools—such as Yale, Berkeley, and Northwestern—even subscribe directly to Quimbee for all their law students.

    Unlock this case briefRead our student testimonials
  2. Learn more about Quimbee’s unique (and proven) approach to achieving great grades at law school.

    Quimbee is a company hell-bent on one thing: helping you get an “A” in every course you take in law school, so you can graduate at the top of your class and get a high-paying law job. We’re not just a study aid for law students; we’re the study aid for law students.

    Learn about our approachRead more about Quimbee

Here's why 541,000 law students have relied on our case briefs:

  • Written by law professors and practitioners, not other law students. 26,900 briefs, keyed to 983 casebooks. Top-notch customer support.
  • The right amount of information, includes the facts, issues, rule of law, holding and reasoning, and any concurrences and dissents.
  • Access in your classes, works on your mobile and tablet. Massive library of related video lessons and high quality multiple-choice questions.
  • Easy to use, uniform format for every case brief. Written in plain English, not in legalese. Our briefs summarize and simplify; they don’t just repeat the court’s language.

Access this case brief for FREE

With a 7-day free trial membership
Here's why 541,000 law students have relied on our case briefs:
  • Reliable - written by law professors and practitioners, not other law students
  • The right length and amount of information - includes the facts, issue, rule of law, holding and reasoning, and any concurrences and dissents
  • Access in your class - works on your mobile and tablet
  • 26,900 briefs - keyed to 983 casebooks
  • Uniform format for every case brief
  • Written in plain English - not in legalese and not just repeating the court's language
  • Massive library of related video lessons - and practice questions
  • Top-notch customer support

Access this case brief for FREE

With a 7-day free trial membership