Showing 207 of 207 results

Chapter: 8.2

Case Name: Sidibe v. Health, Case No. 12-cv-04854-LB, 2018 U.S. Dist. LEXIS 20350 (N.D. Cal. Feb. 7, 2018)
(holding that a third party consultant was outside privilege protection; "There are certain exceptions where the privilege extends to communications involving a third party, such as certain situations in which the third party is necessary to interpret the client's statements to the attorney. See id. at 1071 (citing United States v. Kovel, 296 F.2d 918, 922 (2d Cir. 1961) (discussing example)). But privilege does not extend to situations 'in which the [third party] is enlisted merely to give his or her own advice about the client's situation.' Id. at 1072 (emphasis modified). '[A] communication between an attorney and a third party does not become shielded by the privilege solely because the communication proves important to the attorney's ability to represent the client.' Id. (internal ellipsis omitted) (quoting United States v. Adlman, 68 F.3d 1495, 1500 (2d Cir. 1995)). Rather, '[t]he third-party communications must be interpretive and serve to translate informative information between the client and attorney' to be privileged. Cohen v. Trump, No. 13-CV-2519-GPC (WVG), 2015 U.S. Dist. LEXIS 74542, 2015 WL 3617124, at *14 (S.D. Cal. June 9, 2015) (citing cases)."; "This consultant-created document does not appear to contain or rely on any communications between Sutter and its attorneys, much less any confidential communications made for the purposes of seeking legal advice. The consultant was not interpreting or translating any information from Sutter for its attorneys. Rather, it appears that the consultant compiled its own business (not legal) analysis wholly independently of any confidential information that Sutter communicated to its attorneys for the purposes of seeking legal advice. The fact that Sutter's attorneys might have been the ones who retained the consultant and that the consultant's report was useful to the attorneys does not render the consultant's report privileged. See Cohen, 2015 U.S. Dist. LEXIS 74542, 2015 WL 3617124, at *14; Chevron Texaco, 241 F. Supp. 2d at 1071-72. The court finds that Sutter has not met its burden of establishing that this document is privileged.")

Case Date Jurisdiction State Cite Checked
2018-02-07 Federal ND
Comment:

key case


Chapter: 8.2

Case Name: Margulis v. The Hertz Corporation, Civ. A. No. 14-1209 (JMV), 2017 U.S. Dist. LEXIS 28311 (D.N.J. Feb. 28, 2017)
(holding that a corporate family was not "one" client, but that a United States law firm jointly represented a U.S. company and an overseas affiliate; "'The Court does not see an 'agent' theory of the attorney-client privilege present in this case. Here, the documents at issue are emails between and among employees of the various Hertz companies referenced above. The application of privilege to such communications would be more appropriately described as 'intra-' or 'inter-' corporate communications between employees and analyzed under that standard. . . . In contrast, an 'agent' is most commonly a non-lawyer third-party that assists a lawyer in providing legal services, such as an investigator, paralegal, or accountant. . . . Except for very minor exceptions identified herein, the agent theory of the attorney-client privilege is largely inapplicable to this dispute.'")

Case Date Jurisdiction State Cite Checked
2017-02-28 Federal NJ

Chapter: 8.2

Case Name: Valenzuela v. Union Pacific Railroad Co., No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016)
February 15, 2017 (PRVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-21 Federal AZ
Comment:

key case


Chapter: 8.2

Case Name: Valenzuela v. Union Pacific Railroad Co., No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-21 Federal AZ
Comment:

key case


Chapter: 8.2

Case Name: Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-09 Federal NY
Comment:

key case


Chapter: 8.2

Case Name: In re Riddell Concussion Reduction Litigation, Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Case Date Jurisdiction State Cite Checked
2016-12-05 Federal NJ
Comment:

key case


Chapter: 8.2

Case Name: Baylor v. Mitchell Rubenstein & Associates, P.C., Case No. 1:13-cv-01995 (ABJ-GMH), 2015 U.S. Dist. LEXIS 100183 (D.D.C. July 31, 2015)
("In her supplemental memorandum, plaintiff argues that Sunrise [a client agent retained "for the limited purpose of finding an attorney"] engaged in the unauthorized practice of law by interposing itself between Arrowood, the client, and defendant, the attorney. . . . Plaintiff then concludes that because Sunrise engaged in the unauthorized practice of law, there can be no attorney-client privilege between defendant and Sunrise or defendant and Arrowood. . . . The Court is not persuaded by this argument. Assuming without deciding that Sunrise engaged in the unauthorized practice of law, plaintiff fails to explain why such wrongdoing by Sunrise should serve to waive or eliminate Arrowood's attorney-client privilege.")

Case Date Jurisdiction State Cite Checked
2015-07-31 Federal DC

Chapter: 8.2

Case Name: Baylor v. Mitchell Rubenstein & Associates, P.C., Case No. 1:13-cv-01995 (ABJ-GMH), 2015 U.S. Dist. LEXIS 100183 (D.D.C. July 31, 2015)
("A key threshold inquiry for privilege purposes, then, is whether Sunrise acted as Arrowood's agent. If Sunrise was not Arrowood's agent, then defendant disclosed all the communications at issue to an unrelated third party. Further, the allegedly privileged materials demonstrate that Arrowood knew of defendant's communication with Sunrise. If Arrowood knowingly permitted its attorney to communicate with an unrelated third party, it would have thereby waived its privilege. . . . By contrast, if Sunrise was Arrowood's agent, then the communications between defendant and Sunrise would not be automatically disqualified from protection by the attorney-client privilege."; "The Court finds that, based on the record before it, Sunrise acted as Arrowood's agent for . . . Obtaining legal advice from defendant."; "[H]ere Arrowood hired Sunrise for the limited purpose of finding an attorney to help Arrowood collect plaintiff's debt.")

Case Date Jurisdiction State Cite Checked
2015-07-31 Federal DC

Chapter: 8.2

Case Name: SNC Lavalin Am., Inc. v. Alliant Techsystems, Inc., Civ. A. No. 7:10CV00540, 2011 U.S. Dist. LEXIS 115535, at *5 n.2 (W.D. Va. Oct. 6, 2011)
("The same is true for communications between a client and a third party retained by the client. While the United States Court of Appeals has held that the invocation of the attorney-client privilege may be appropriate in cases involving communications between a client and its agent, such communications must be 'made for the purpose of facilitating the rendition of legal services.' See In re Grand Jury Proceedings Under Seal, 947 F.2d 1188, 1191 (4th Cir. 1996).")

Case Date Jurisdiction State Cite Checked
2011-10-06 Federal VA

Chapter: 8.2

Case Name: 3Com Corporation v. Diamond II Holdings, Inc., C.A. No. 3933-VCN, 2010 Del. Ch. LEXIS 126 (Del. Ct. Ch. May 31, 2010)
(applying Delaware rather than Massachusetts privilege law, and ultimately finding that the attorney-client privilege protected the client's communications with its investment banker Goldman Sachs; "This particular challenge raises a choice-of-law dispute over whether Delaware or Massachusetts law should apply. 3Com would apply the law of Delaware, which extends a wider privilege for communications made between a client and its attorney in the presence of an investment banker than that recognized by Massachusetts.")

Case Date Jurisdiction State Cite Checked
2010-05-31 State DE

Chapter: 8.2

Case Name: Asousa P'ship v. Smithfield Foods, Inc. (In re Asousa P'ship), Ch. 11 No. 01-12295DWS, Adv. No. 04-1012, 2005 Bankr. LEXIS 2373, at *14, 16, 18, 19 (Bankr. E.D. Pa. Nov. 17, 2005)
(internal citation omitted) (finding that an appraiser retained by a company's outside law firm was outside the privilege protection; explaining that a "company received a proposal from an asset valuation consultant offering to provide asset valuation services to the company for 'management planning' purposes"; noting that the consultant's proposal came to the company's in-house lawyer, who then forwarded the consultant's proposal to its outside law firm; explaining that the outside lawyer indicated that the company could increase the chance of successfully asserting privilege for the consultant's work if the outside law firm retained the consultant, or if the consultant sent the outside law firm his report, which could then be forwarded back to the company; using remarkably harsh language in rejecting the company's privilege claims; explaining that the company had "engaged in a blatant subterfuge" by using the outside law firm as a "mere conduit" between the consultant and the company; calling the outside law firm's retention of the consultant "ghost-hiring" and the outside law firm's receipt of the consultant's report "laying of hands" on the report; labeling the entire arrangement "artifice, used solely to create the appearance of the now-asserted attorney-client privilege.")

Case Date Jurisdiction State Cite Checked
2005-11-17 Federal PA
Comment:

key case


Chapter: 8.2

Case Name: Head v. Inova Health Care Servs., 55 Va. Cir. 43, 45 (Va. Cir. Ct. 2001)
(holding that the attorney-client privilege and the work product doctrine protected correspondence between the hospital's lawyer and a risk management analyst about an investigation of an incident that ultimately resulted in the litigation, including memoranda from the analyst to the hospital's lawyer "summarizing interviews with treating nurses"; not explaining if the analyst was an employee or consultant) [Thacher, J.]

Case Date Jurisdiction State Cite Checked
2001-01-01 State VA nsvb 2/23/04

Chapter: 8.3

Case Name: Sidibe v. Health, Case No. 12-cv-04854-LB, 2018 U.S. Dist. LEXIS 20350 (N.D. Cal. Feb. 7, 2018)
(holding that a third party consultant was outside privilege protection; "There are certain exceptions where the privilege extends to communications involving a third party, such as certain situations in which the third party is necessary to interpret the client's statements to the attorney. See id. at 1071 (citing United States v. Kovel, 296 F.2d 918, 922 (2d Cir. 1961) (discussing example)). But privilege does not extend to situations 'in which the [third party] is enlisted merely to give his or her own advice about the client's situation.' Id. at 1072 (emphasis modified). '[A] communication between an attorney and a third party does not become shielded by the privilege solely because the communication proves important to the attorney's ability to represent the client.' Id. (internal ellipsis omitted) (quoting United States v. Adlman, 68 F.3d 1495, 1500 (2d Cir. 1995)). Rather, '[t]he third-party communications must be interpretive and serve to translate informative information between the client and attorney' to be privileged. Cohen v. Trump, No. 13-CV-2519-GPC (WVG), 2015 U.S. Dist. LEXIS 74542, 2015 WL 3617124, at *14 (S.D. Cal. June 9, 2015) (citing cases)."; "This consultant-created document does not appear to contain or rely on any communications between Sutter and its attorneys, much less any confidential communications made for the purposes of seeking legal advice. The consultant was not interpreting or translating any information from Sutter for its attorneys. Rather, it appears that the consultant compiled its own business (not legal) analysis wholly independently of any confidential information that Sutter communicated to its attorneys for the purposes of seeking legal advice. The fact that Sutter's attorneys might have been the ones who retained the consultant and that the consultant's report was useful to the attorneys does not render the consultant's report privileged. See Cohen, 2015 U.S. Dist. LEXIS 74542, 2015 WL 3617124, at *14; Chevron Texaco, 241 F. Supp. 2d at 1071-72. The court finds that Sutter has not met its burden of establishing that this document is privileged.")

Case Date Jurisdiction State Cite Checked
2018-02-07 Federal ND
Comment:

key case


Chapter: 8.3

Case Name: Margulis v. The Hertz Corporation, Civ. A. No. 14-1209 (JMV), 2017 U.S. Dist. LEXIS 28311 (D.N.J. Feb. 28, 2017)
(holding that a corporate family was not "one" client, but that the United States law firm jointly represented a U.S. company and an overseas affiliate; "This document is privileged."; "The subject of the document states: 'Margulis v. Hertz . . . ." This appears to be a communication by a necessary intermediary seeking information relating to the Hertz litigation. While a non-Hertz employee is involved (Mr. Slovak) he is acting as an agent in this context in the sense that he is acquiring and providing information to a Hertz employee to relay back to Hertz counsel on a legal issue in the case. Mr. Slovak's involvement is different from that of Ms. Weston's (see, e.g., Log Entry 684), because it appears that Mr. Slovak is capable of, and is, providing information to counsel that could not be provided by any other individual, rending him a necessary intermediary.")

Case Date Jurisdiction State Cite Checked
2017-02-28 Federal NJ

Chapter: 8.3

Case Name: Harrington v. Bergen County, A. No. 2:14-cv-05764-SRC-CLW, 2016 U.S. Dist. LEXIS 124727 (D.N.J. Sept. 13, 2016)
November 23, 2016 (PRIVILEGE POINT)

"Plaintiff's Live-In Boyfriend was Outside Privilege Protection, but Inside Work Product Protection: Part I"

Nearly every court finds that the only client agents/consultants inside privilege protection are those necessary for the communications between the client and her lawyer. But the work product doctrine casts a wider protective net.

In Harrington v. Bergen County, A. No. 2:14-cv-05764-SRC-CLW, 2016 U.S. Dist. LEXIS 124727 (D.N.J. Sept. 13, 2016), a civil rights plaintiff suing her former employer claimed that her live-in boyfriend was inside privilege protection – so that his presence during her communications with her lawyer did not destroy the privilege. The court acknowledged that plaintiff had been involuntarily committed to a mental hospital at the pertinent time, and that her boyfriend "has provided meaningful assistance" to her. Id. at *11. But the court was "not convinced that disclosure to [her boyfriend] was necessary or essential for Plaintiff to obtain informed legal advice." Id. The court noted that the "Plaintiff offers no medical or other expert opinion" about her inability to communicate with her lawyer without her boyfriend present. Id. at *11-12. The court stripped away privilege protection from communications in her boyfriend's presence, or later shared with her boyfriend.

Most clients (both individual and corporate) do not appreciate the miniscule range for their agents/consultants to be within privilege protection. Next week's Privilege Point will address the court's work product analysis.

Case Date Jurisdiction State Cite Checked
2016-09-13 Federal NJ
Comment:

key case


Chapter: 8.3

Case Name: Obeid v. La Mack, 14 cv. 6498 (LTS) (MHD), 2015 U.S. Dist. LEXIS 127327 (S.D.N.Y. Sept. 16, 2015)
("That protection extends as well to communications between (1) the attorney or his representative and (2) a representative or agent of the client, and to communications with others who are facilitating the rendition of legal services by the lawyer.").

Case Date Jurisdiction State Cite Checked
2015-09-16 Federal NY

Chapter: 8.3

Case Name: Cardinal Aluminum Company v. Continental Casualty Company, Case No. 3:14-CV-857-TBR-LLK, 2015 U.S. Dist. LEXIS 95361 (W.D. Ky. July 22, 2015)
("Plaintiff's chief financial officer submitted an affidavit related to this motion. . . . In that affidavit, the CFO testified that Plaintiff 'asked [its [insurance] broker] to submit a claim to [Defendant] seeking coverage for the cost to repair the machine.' . . . Moreover, the broker negotiated on Plaintiff's behalf and advised Plaintiff concerning the claims process. . . . These specific actions do not amount to legal advice. Had an officer or employee of Plaintiff done the same, the internal communications of Plaintiff would not become privileged from discovery. The privilege only applies to communications seeking legal advice, not business advice."; "Plaintiff did not argue that its broker acted to effectuate legal representation for Plaintiff. Ky. R. Evid. 503(a)(2)(B)(iii). Based on the record before it, the Court cannot determine that the broker qualifies as a representative of Plaintiff for the purposes of Rule 503 for each or any document sought by the subpoena.")

Case Date Jurisdiction State Cite Checked
2015-07-22 Federal KY
Comment:

key case


Chapter: 8.3

Case Name: Cohen v. Cohen, 09 Civ. 10230 (LAP), 2015 U.S. Dist. LEXIS 21319 (S.D.N.Y. Jan. 30, 2015)
(in an action by a wife against her former husband for fraud in connection with assets, analyzing the wife's communications to and from a litigation funder; finding that the funder did not meet the Kovel doctrine; "Because Ms. Napp [Funder] is neither necessary to facilitate Plaintiff's communications with counsel nor in possession of a legal claim against Defendants, her communications with Plaintiff are not privileged. With regard to her Kovel argument, Plaintiff has made no showing that Ms. Napp is 'indispensable or serve[s] some specialized purpose in facilitating the attorney client communications.'. . . Rather, her primary purpose appears initially to be making a decision as to whether her company will fund Plaintiff's legal team and thereafter reviewing and commenting on legal strategy presumably to maximize the chances of a return on her investment. These functions cannot be analogized to the interpreters or accounts of the Kovel line, who serve a specific function necessary to effectuate legal representation.")

Case Date Jurisdiction State Cite Checked
2015-01-30 Federal NY

Chapter: 8.3

Case Name: Green v. Beer, No. 06 Civ. 4156 (KMW) (JCF), 2010 U.S. Dist. LEXIS 87484, at *5, *12 13, *13-14, *14 (S.D.N.Y. Aug. 24, 2010)
(reversing a portion of Magistrate Judge Francis's earlier ruling, and affirming another portion of his ruling; holding that (1) a couple did not waive their privilege protection by asking their son to print out their emails, because the son was providing necessary technical assistance to his parents (reversing Judge Francis's holding to the contrary), and (2) that the couple waived their attorney-client privilege by disclosing privileged communications to their financial advisors (affirming Judge Francis's holding); "Daniel Green, the son of the Green Plaintiffs, received email communications from counsel, which he then provided to his parents. He explained in his affidavit that his technical assistance was necessary for his parents to timely receive the email communications from counsel: 'My parents are not proficient in the use [of] electronic mail and, due to the time-sensitive nature of these communications, it was necessary for these communications to be delivered to my email address to ensure a timely receipt. My parents regularly rely on me to send and receive emails for them.'" (internal citation omitted); "The magistrate judge committed clear error by failing to apply Section 4548 of the New York Civil Practice Law and Rules, the relevant state law on attorney-client privilege and electronic communications. The magistrate judge instead applied only the two-part test for the exception to a waiver of privilege, finding that Daniel Green's involvement was not necessary to the provision of legal services given that alternative means of communication were available. This analysis is incomplete in the context of electronic communications, for which Section 4548 applies. Plaintiffs have provided sufficient evidence that the Green Plaintiffs lack proficiency in the use of email, and that their son's assistance was 'necessary for the delivery of facilitation' of counsel's emailed communications to the Green Plaintiffs. . . . Thus, under Section 4548, the Green Plaintiffs have not waived the attorney-client privilege based on Daniel Green's involvement in the delivery of the disputed emails."; "The magistrate judge also erred by not finding that Daniel Green served as an agent for the Green Plaintiffs, and that his involvement in the delivery of the otherwise confidential communications would not constitute a waiver of privilege. It is clear that the Green Plaintiffs had a reasonable expectation that the email communications would remain confidential, and that the technical assistance provided by their son, in his capacity as their agent, should not constitute a waiver of the attorney-client privilege."; "A finding that privilege has not been waived in this case is appropriate as a matter of public policy. Email permits attorneys and their clients to engage in prompt communication, often regarding time-sensitive matters. A client lacking proficiency in Internet technology should not be prevented from enjoying the advantages of email correspondence for fear that the necessary assistance of a third party -- here, the Green Plaintiff's son -- in sending or receiving such correspondence will lead to the forfeiture of the attorney-client privilege.")

Case Date Jurisdiction State Cite Checked
2010-08-24 Federal NY B 7/16
Comment:

key case


Chapter: 8.3

Case Name: Parker v. Carter, 18 Va. (4 Munf.) 273, 287 n.1, 275 (1814)
("It was admitted by all the judges in conference, that the privilege equally applied to interpreters acting as the organ of communication between the client and his attorney")

Case Date Jurisdiction State Cite Checked
1814-01-01 State VA

Chapter: 8.4

Case Name: Firefighters' Retirement System v. Citco Group Ltd., Civ. A. No. 13-373-SDD-EWD, 2018 U.S. Dist. LEXIS 85697 (M.D. La. May 22, 2018)
(analyzing privilege choice of law issues, and ultimately concluding that UBS was inside privilege protection as a client consultant, although citing Kovel, because UBS's assistance was "indispensable" to the provision of legal advice (citing and quoting other cases); "A 'representative of a client' is defined in Louisiana Code of Evidence, article 506, as '[a] person having authority to obtain professional legal services, or to act on advice so obtained, on behalf of the client' or '[a]ny other person who makes or receives a confidential communication for the purpose of effectuating legal representation for the client, while acting in the scope of employment for the client.' Here, the Citco Defendants have asserted various communications between themselves, UBS employees, and Linklaters (Citco's counsel) are privileged because UBS was a representative of Citco 'and had authority to obtain professional legal services and to act on advice so obtained on behalf of Citco.' The burden of establishing that these communications are subject to the attorney-client privilege lies with the Citco Defendants, the party asserting the privilege."; "The Fifth Circuit has cited Kovel with approval in the context of a case applying the federal common law of attorney-client privilege, and courts in this Circuit have relied on Kovel when determining whether communications with third parties are privileged. Following these principles, other courts have found that communications with third-party financial advisors or investment bankers are protected by the attorney-client privilege where such communications were indispensable to the provision of the attorney's legal advice."; "Crane Security Technologies v. Rolling Optics, Civil Action No. 14-12428, 230 F. Supp. 3d 10, 22-26 (D. Mass. Feb. 3, 2017) (where plaintiff engaged financial services firm 'specifically' to assist in acquiring certain patents, and plaintiff's outside counsel communicated with financial services firm regarding the drafting and negotiating of the acquisition agreements, the court found the communications to be privileged because the communications were intended to remain confidential, review of the documents indicated that attorney asked financial services firm 'for help crafting legal advice,' and attorney averred in a declaration that legal advice was shared with financial services firm when 'necessary to accomplish' the legal advice and that his practice was to collaborate confidentially with third-party financial advisors on significant corporate transactions); In re Piedmont Office Realty Trust Inc. Securities Litigation, Civil Action No. 1:07-cv-02660, 2011 WL 13169494, at *2-4 (N.D. Ga. Oct. 27, 2011) (communications with investment bankers and other financial advisors privileged where a review of the documents at issue revealed that client's attorney 'relied upon the observations and experience of these third parties in evaluating the propriety, accuracy, and materiality of the disclosure [client] was to make in its public communications and SEC filings' and the communications 'were sent for a predominately legal purpose and with an expectation of confidentiality.'); Blau v. Harrison (In re JP Morgan Chase & Co. Sec. Litig.), MDL No. 1783, 06 C 4674, 2007 U.S. Dist. LEXIS 60095, 2007 WL 2363311, at *7-8 (N.D. Ill. Aug. 13, 2007) (where client hired third-party to provide investment advisor services in connection with a merger, communications with third party investment advisor protected by attorney-client privilege); Stafford Trading, Inc. v. Lovely, No. 05-C-4868, 2007 U.S. Dist. LEXIS 13062, 2007 WL 611252 at *7 (N.D. Ill. Feb. 22, 2007) (where plaintiff and other Stafford-owned entities retained investment banker Goldman Sachs ('GS') to locate potential purchasers for Stafford and to assist in facilitating the transaction, and GS was 'heavily involved' in negotiations between Stafford and a potential purchaser, privilege extended only to those documents (considered on a document by document basis) reflecting communications where 'GS confidentially communicated with [client's outside counsel] or Stafford's in-house counsel for the purpose of obtaining or providing legal advice.'); Calvin Klein Trademark Trust v. Wachner, No 00, Civ. 4052, 124 F. Supp. 2d 207 (S.D.N.Y. Dec. 20, 2000) (communications privileged notwithstanding the participation of investment bankers because investment bankers' role 'involved rendering expert advice as to what a reasonable business person would consider 'material'" and 'a responsible law firm . . . would not be able to adequately resolve [the question of materially] without the benefit of an investment banker's expert assessment of which facts were 'material' from a business person's perspective.'"; "Per the engagement letter between Citco Trading and UBS, UBS was to provide the following 'financial advice and assistance' with respect to a potential sale transaction involving Richcourt and a third party."; "As evidence of the roles served by UBS, the Citco Defendants submit a Declaration from Citco Groups' General Counsel, Mr. Braham, wherein he asserts that Citco Trading retained Linklaters 'to provide legal advice on the sale of Richcourt' and retained UBS 'to, among other things, conduct the sale of Richcourt Holding and to provide Citco Trading and Citco Group with advice regarding that transaction.' Mr. Braham avers that UBS's role 'was to conduct an auction process for the sale of the Richcourt group of companies, assess the bids that were received by prospective purchasers and provide recommendations on those bids, and assist Citco Group's in-house and outside counsel in negotiating a purchase agreement with the ultimate purchaser.'"; "Per the terms of the engagement letter and Mr. Braham's Declaration, UBS was retained by Citco Trading to provide various services. Some of these services – specifically with respect to developing and contacting potential purchasers, and preparing and circulating sales documentation – do not appear to be focused on providing services necessary for the rendering of legal, rather than business, advice. However, other services (i.e., assisting in the negotiation of the terms of the transaction) may fairly be within the scope of that necessary for Linklaters to provide legal advice to Citco Trading. The Citco Defendants concede that certain communications with UBS do not fall within the scope of the privilege, and explain that they have 'produced several thousand communications involving UBS where UBS was in fact providing routine business advice or was 'merely copied.' However, with respect to the withheld UBS Documents, the Citco Defendants assert that these 'communications involve UBS working hand-in-hand with Linklaters and in-house counsel to provide legal advice to Citco Group.' The detailed descriptions set forth on the Citco Defendants' privilege log reflect that the withheld communications were primarily for the purpose of obtaining or rendering legal advice.")

Case Date Jurisdiction State Cite Checked
2018-05-22 Federal LA
Comment:

key case


Chapter: 8.4

Case Name: Wade v. Touchdown Realty Grp., Civ. A. No. 17-10400-PBS, 2018 U.S. Dist. LEXIS 13069 (D. Mass. Jan. 26, 2018)
(finding that a client agent/consultant was outside privilege protection, but that disclosing work product to the consultant did not waive that protection; "In the instant case, there is no evidence that Mr. Schadler [a consultant on a bathroom and bedroom renovation] was needed to help translate any communications between the Wades and their attorney, and he clearly was not hired for such a purpose. This is sufficient to defeat the claim of privilege. . . . Even more significantly, there is nothing in the emails cited above in which Mr. Schadler was called upon to provide interpretative services in connection with the communications between the Wades and their counsel. The derivative attorney/client privilege does not shield the production of these documents.")

Case Date Jurisdiction State Cite Checked
2018-01-26 Federal MA
Comment:

key case


Chapter: 8.4

Case Name: Narayanan v. Sutherland Global Holdings Inc., 15-CV-6165T, 2018 U.S. Dist. LEXIS 12358 (W.D.N.Y. Jan. 25, 2018)
(analyzing the privilege implications of a company relying on a public accountant firm (run by a former employee of the company) to investigate an acquisition of land in India; holding that the accountant consultant and its managing director were not the functional equivalent of corporate employees, and were outside privilege protection as client agents/consultants; "Sutherland [Company] has offered no explanation for the purported need to include Rank's [Indian law firm] legal advice in the Report, the purpose of which, according to the engagement letter, was to detail Freed Maxick's [CPA agent/consultant] factual findings regarding the Sutherland Land Acquisition and to recommend internal controls. In the absence of proof to the contrary, I find that the decision to include Rank's legal advice in the Report was one of convenience, rather than necessity."; "Moreover, there is no evidence that Rank's attorneys could not have understood the Sutherland Land Acquisition or rendered legal advice to Sutherland about its options for recovering the advanced funds without Freed Maxick's help. Indeed, Rank, an Indian-based law firm 'specializ[ing] in real estate transactions'. . . was retained by Sutherland to advise on Indian-based real estate transactions. Beyond Vellodi's wholly conclusory assertion, no specific factual showing has been made that Rank or Sutherland required Russo [former Sutherland senior vice president of finance and former CFO] to facilitate the provision of legal advice from Rank to Sutherland."; "In short, the record is devoid of facts to demonstrate that Freed Maxick's involvement was 'nearly indispensable or serve[d] some specialized purpose in facilitating attorney-client communications.'. . . Rather, the proof suggests that Freed Maxick's role in attorney-client communications was merely useful and convenient. That alone does not shield the privilege from waiver.")

Case Date Jurisdiction State Cite Checked
2018-01-25 Federal NY
Comment:

key case


Chapter: 8.4

Case Name: Narayanan v. Sutherland Global Holdings Inc., 15-CV-6165T, 2018 U.S. Dist. LEXIS 12358 (W.D.N.Y. Jan. 25, 2018)
(analyzing the privilege implications of a company relying on a public accountant firm (run by a former employee of the company) to investigate an acquisition of land in India; holding that the accountant consultant and its managing director were not the functional equivalent of corporate employees, and were outside privilege protection as client agents/consultants; "[T]he applicability of the agency exception depends on whether Sutherland [Company] has demonstrated that Freed Maxick's [CPA agent/consultant] involvement in attorney-client communications was 'nearly indispensable or serve[d] some specialized purpose in facilitating the attorney-client communications.'"; "Russo [former Sutherland senior vice president of finance and former CFO] provided Rank [Indian law firm] with the facts necessary for Rank to provide legal advice to Sutherland."; "Based on the record before the Court, I find that Sutherland's assertion of privilege as to these particular communications is unjustified."; "The reasoning of Ackert compels a similar conclusion in this case. Here, Russo provided factual information to Rank that Sutherland did not itself possess; although it may have been helpful or convenient to Rank to speak directly to Russo, the record does not prove that Rank needed Russo to interpret the information for it. Indeed, Russo testified that Rank did not provide advice about accounting matters. . . . Accordingly, I find that the communications between Russo and Rank are not privileged.")

Case Date Jurisdiction State Cite Checked
2018-01-25 Federal NY
Comment:

key case


Chapter: 8.4

Case Name: Narayanan v. Southern Global Holdings Inc., No. 15-CV-6165T, 2018 U.S. Dist. LEXIS 12358, at *12 (W.D.N.Y. Jan. 25, 2018)
March 21, 2018 (PRIVILEGE POINT)

"Courts Wrestle with Privilege Protection for Client Consultants: Part I"

The attorney-client privilege protects confidential communications between clients and their lawyers. Corporate client consultants may also deserve this protection if they act as the "functional equivalent" of corporate employees. Otherwise, most but not all courts take a very narrow view of privilege protection for communications to or from such consultants.

In Durling v. Papa John's International, Inc., No. 16 Civ. 3592 (CS) (JCM), 2018 U.S. Dist. LEXIS 11584(S.D.N.Y. Jan. 24, 2018), Papa John's relied on a third-party consultant to analyze how it should reimburse its delivery drivers. Class action plaintiffs claiming minimum wage violations sought communications between Papa John's and the consultant. The court first rejected Papa John's "functional equivalent" argument – noting that the consultant's employees were "not so fully integrated into the [Papa John's] hierarchy that its employees were de facto employees of [Papa John's]." Id.at *15. The court also found that the consultant was outside privilege protection, because its "role was not as a translator or interpreter of client communications," and that Papa John's retained the consultant "not to improve the comprehension of the communications between attorney and client, but rather to obtain information that [Papa John's] did not already have." Id. at *14. One day later, another court in Narayanan v. Southern Global Holdings Inc., similarly found that a corporation's "consulting and accounting firm" failed the "functional equivalent" standard and likewise fell outside privilege protection -- because the consultant's involvement was not "nearly indispensable or serve[d] some specialized purpose in facilitating the attorney-client communications." No. 15-CV-6165T, 2018 U.S. Dist. LEXIS 12358, at *12 (W.D.N.Y. Jan. 25, 2018). Instead, "the proof suggests that [the consultant's] role in attorney-client communications was merely useful and convenient." Id. at *19.

Most courts take this narrow approach. But next week's Privilege Point will discuss a case going the other way.

Case Date Jurisdiction State Cite Checked
2018-01-25 Federal NY
Comment:

key case


Chapter: 8.4

Case Name: Durling v. Papa John's International, Inc., No. 16 Civ. 3592 (CS) (JCM), 2018 U.S. Dist. LEXIS 11584(S.D.N.Y. Jan. 24, 2018)
March 21, 2018 (PRIVILEGE POINT)

"Courts Wrestle with Privilege Protection for Client Consultants: Part I"

The attorney-client privilege protects confidential communications between clients and their lawyers. Corporate client consultants may also deserve this protection if they act as the "functional equivalent" of corporate employees. Otherwise, most but not all courts take a very narrow view of privilege protection for communications to or from such consultants.

In Durling v. Papa John's International, Inc., No. 16 Civ. 3592 (CS) (JCM), 2018 U.S. Dist. LEXIS 11584(S.D.N.Y. Jan. 24, 2018), Papa John's relied on a third-party consultant to analyze how it should reimburse its delivery drivers. Class action plaintiffs claiming minimum wage violations sought communications between Papa John's and the consultant. The court first rejected Papa John's "functional equivalent" argument – noting that the consultant's employees were "not so fully integrated into the [Papa John's] hierarchy that its employees were de facto employees of [Papa John's]." Id.at *15. The court also found that the consultant was outside privilege protection, because its "role was not as a translator or interpreter of client communications," and that Papa John's retained the consultant "not to improve the comprehension of the communications between attorney and client, but rather to obtain information that [Papa John's] did not already have." Id. at *14. One day later, another court in Narayanan v. Southern Global Holdings Inc., similarly found that a corporation's "consulting and accounting firm" failed the "functional equivalent" standard and likewise fell outside privilege protection -- because the consultant's involvement was not "nearly indispensable or serve[d] some specialized purpose in facilitating the attorney-client communications." No. 15-CV-6165T, 2018 U.S. Dist. LEXIS 12358, at *12 (W.D.N.Y. Jan. 25, 2018). Instead, "the proof suggests that [the consultant's] role in attorney-client communications was merely useful and convenient." Id. at *19.

Most courts take this narrow approach. But next week's Privilege Point will discuss a case going the other way.

Case Date Jurisdiction State Cite Checked
2018-01-24 Federal NY
Comment:

key case


Chapter: 8.4

Case Name: Durling v. Papa John's Int'l, Inc., 16 Civ. 3592 (CS) (JCM), 2018 U.S. Dist. LEXIS 11584 (S.D.N.Y. Jan. 24, 2018)
(finding that a client agent/consultant analyzed the appropriate reimbursement for delivery drivers was not the function equivalent of a Papa John's employee, and was outside privilege protection; also finding that the work product doctrine did not protect documents created by the agent/consultant because it was not motivated by litigation; "[T]he principle of Kovel does not shield communications between PJI [Papa John's] and Motus [Client agent/consultant] because Motus's role was not as a translator or interpreter of client communications. . . . PJI retained Motus not to improve the comprehension of the communications between attorney and client, but rather to obtain information that PJI did not already have.")

Case Date Jurisdiction State Cite Checked
2018-01-24 Federal NY
Comment:

key case


Chapter: 8.4

Case Name: In re Abilify Aripiprazole Prods. Liab. Litig., Case No. 3:16-md-2734, 2017 U.S. Dist. LEXIS 213493 (N.D. Fla. Dec. 29, 2017)
(finding that public relations consultants were inside privilege protection; "[W]hen a public relations firm has been retained to assist the corporate client and its counsel with an ongoing investigation the public relations firm stands in the same shoes as the corporate client with regard to communications between the public relations firm and counsel for the corporate client, or between the public relations firm and the corporate client 'that were made for the purpose of facilitating the rendition of legal services to the corporate client.'"; "The same principles apply to marketing firms (e.g. W2 Group, Twist Marketing), retained by Defendants. To the extent these firms were retained to assist Otsuka's in-house legal departments in monitoring and analyzing media coverage as part of in-house counsel's strategies and legal advice relating to threatened and ongoing litigation and actions by regulatory agencies, the consultants would stand in the shoes of an Otsuka corporate employee. The key is not whether the entity is a consultant but rather whether the function performed by the consultant related to assisting legal counsel in providing legal advice and strategy concerning the legal position of Otsuka in the media coverage concerning the litigation. In the world today -- where a drug manufacturer may face liability in the hundreds of millions of dollars in a product liability suit -- it is not only common but necessary to involve public relations and marketing consultants to assist in-house counsel and outside counsel in responding to media inquiries regarding ongoing or threatened legal actions. So long as the role of the consultant is to assist legal counsel in responding to the media the protections of the attorney-client privilege should apply the same as where a corporate employee is tasked with responding to media inquiries. The Court has utilized these principles in making its in camera review.")

Case Date Jurisdiction State Cite Checked
2017-12-29 Federal FL
Comment:

key case


Chapter: 8.4

Case Name: Selby v. O'Dea, No. 1-15-1572, 2017 Ill. App. LEXIS 749 (Ill. App. 1d 4th Div. Dec. 7, 2017)
(affirming and explaining the contours of the common interest doctrine under Illinois law; "[T]he attorney-client privilege in Illinois already protects statements made by the client to necessary agents of the attorney or client, including certain nontestifying experts and investigators who assist in the preparation of the case.")

Case Date Jurisdiction State Cite Checked
2017-12-07 State IL

Chapter: 8.4

Case Name: Homeward Residential, Inc. v. Sand Canyon Corp., 12-CV-5067 (JFK) (JLC), 12-CV-7319 (JFK) (JLC), 2017 U.S. Dist. LEXIS 171685 (S.D.N.Y. Oct. 17, 2017)
(holding that a loan servicer and a certificate holder shared a sufficiently common interest for privilege purposes when the client consultant was outside privilege protection; "The agency exception prevents waiver of communications made through an agent where the agent is facilitating communications between the attorney and the client and where disclosure of the communications to the agent is necessary (not merely useful) for the client to obtain informed legal advice."; "The agency exception is not applicable here. While Ocwen and Homeward (and their counsel) presumably had good reasons for communicating with Altisource [provides data management and reporting services to Ocwen], the reasons proffered are not sufficient to satisfy the requirements of the agency exception. Homeward has not established that communication with Altisource was necessary in order to facilitate communication between Ocwen and Ocwen's counsel, or between Homeward and Homeward's counsel. . . . Altisource, a company that Ocwen worked with to handle Ocwen's data on a routine basis, does not, based on the record presented, appear to have had an indispensable role in translating, interpreting, or helping with the communications between Ocwen and counsel.")

Case Date Jurisdiction State Cite Checked
2017-10-17 Federal NY
Comment:

key case


Chapter: 8.4

Case Name: In re Niaspan Antitrust Litig., Master File No. 13-MD-2460, 2017 U.S. Dist. LEXIS 135753 (E.D. Pa. Aug. 24, 2017)
("'The Court notes that entry 1572 is covered by the attorney-client privilege. 'The broad approach to determining whether an independent consultant is the functional equivalent of an employee [focuses] on whether the communications at issue were kept confidential and made for the purpose of obtaining or providing legal advice.'. . . Here, Koven requested that the consultant prepare a report so that Koven could decide whether to initiate litigation. Thus, the communication conveying the report was made for the purpose of enabling Koven to provide legal advice.'")

Case Date Jurisdiction State Cite Checked
2017-08-24 Federal PA

Chapter: 8.4

Case Name: Portland Pipe Line Corp. v. City of S. Portland, No. 2:15-cv-00054-JAW, 2017 U.S. Dist. LEXIS 135704, at *9, *17 (D. Me. Aug. 14, 2017)
November 1, 2017 (PRIVILEGE POINT)

"Courts Continue to Catalogue Client Consultants Outside Privilege Protection"

Clients' agents/consultants are nearly always outside privilege protection. This generally means that their documents do not deserve privilege protection; their presence during otherwise privileged communications aborts that protection; and disclosing privileged communications to them waives the protection.

In JBGR LLC v. Chicago Title Insurance Co., No. 35140-11, 2017 N.Y. Misc. LEXIS 3008 (N.Y. Sup. Ct. Aug. 2, 2017) (unpublished opinion), the court held that the plaintiff's land-use consultant's presence at an otherwise privileged meeting destroyed the privilege. As the court explained, "while [the consultant's] advice may have been important to the legal advice given to the plaintiffs by their lawyers, it was not given to facilitate such legal advice." Id. at *8. Less than two weeks later, a federal court similarly held that the privilege did not protect a report prepared by a real estate appraiser "jointly engaged" by the client and its law firm Pierce Atwood. The court concluded that the appraiser "was not employed to assist Pierce Atwood in rendering legal advice." Portland Pipe Line Corp. v. City of S. Portland, No. 2:15-cv-00054-JAW, 2017 U.S. Dist. LEXIS 135704, at *9, *17 (D. Me. Aug. 14, 2017).

Even sophisticated corporate clients often do not understand that their agents'/consultants' involvement during privileged communications or as recipients of privileged communications usually destroys that protection. Clients sometimes erroneously think that confidentiality arrangements with such agents/consultants will avoid waiving privilege protection. That is incorrect – such agreements generally are irrelevant in analyzing privilege waiver issues.

Case Date Jurisdiction State Cite Checked
2017-08-14 Federal ME
Comment:

key case


Chapter: 8.4

Case Name: JBGR LLC v. Chicago Title Ins. Co., 35140-11, 2017 N.Y. Misc. LEXIS 3008 (N.Y. Sup. Ct. Aug. 2, 2017)
(holding that a land use consultant was outside privilege protection; "The defendant contends that Prusinowski's ["expediter or land-use consultant"] presence at that meeting destroyed the privilege. The plaintiffs contend that Prusinowski was acting as their agent and that his presence at the meeting was necessary to facilitate attorney-client communications."; "The attorney-client privilege may extend to the agent of a client when the communications are intended to facilitate the provision of legal services to the client. . . . For the agency exception to apply, it must be shown that the client (1) had a reasonable expectation of confidentiality under the circumstances and (2) that disclosure to the third party was necessary for the client to obtain informed legal advice. . . . To the extent that the advice sought is that of a non-lawyer service provider, the privilege does not protect the communication . . . The privilege protects communications between a client and an attorney, not communications that prove important to an attorney's legal advice to a client. . . . The party asserting the privilege bears the burden of establishing its essential elements based on competent evidence, usually through affidavits, deposition testimony, or other admissible evidence."; "The plaintiffs have failed to meet their burden. The record reflects that the plaintiffs sought Prusinowski's advice as a non-lawyer service provider. At his deposition Prusinowski testified that he was an expediter or land-use consultant. He was retained by the plaintiffs after they closed on the property in 2006, long before this action was commenced. He was retained to make a case to the Town of Riverhead that 'golf villas' should be considered an accessory use to the Great Rock development in order to get around the 140-home restriction on the property. He testified that he attended meetings and expressed this view to 'a lot of people' in the Town of Riverhead, including the Planning Director, the Town Attorney, and various members of the Town Board and Planning Board. The court finds that, while Prusinowski's advice may have been important to the legal advice given to the plaintiffs by their lawyers, it was not given to facilitate such legal advice. . . . Prusinowski's advice was given to facilitate approval by the Town of Riverhead of the plaintiffs' application to include 55 additional homes or 'golf villas' in the Great Rock development. When, as here, what is sought is the advice or service of the non-lawyer, no privilege exists. . . . Accordingly, the Dempsey memo is not protected by the attorney-client privilege.")

Case Date Jurisdiction State Cite Checked
2017-08-02 State NY

Chapter: 8.4

Case Name: JBGR LLC v. Chicago Title Insurance Co., No. 35140-11, 2017 N.Y. Misc. LEXIS 3008 (N.Y. Sup. Ct. Aug. 2, 2017)
November 1, 2017 (PRIVILEGE POINT)

"Courts Continue to Catalogue Client Consultants Outside Privilege Protection"

Clients' agents/consultants are nearly always outside privilege protection. This generally means that their documents do not deserve privilege protection; their presence during otherwise privileged communications aborts that protection; and disclosing privileged communications to them waives the protection.

In JBGR LLC v. Chicago Title Insurance Co., No. 35140-11, 2017 N.Y. Misc. LEXIS 3008 (N.Y. Sup. Ct. Aug. 2, 2017) (unpublished opinion), the court held that the plaintiff's land-use consultant's presence at an otherwise privileged meeting destroyed the privilege. As the court explained, "while [the consultant's] advice may have been important to the legal advice given to the plaintiffs by their lawyers, it was not given to facilitate such legal advice." Id. at *8. Less than two weeks later, a federal court similarly held that the privilege did not protect a report prepared by a real estate appraiser "jointly engaged" by the client and its law firm Pierce Atwood. The court concluded that the appraiser "was not employed to assist Pierce Atwood in rendering legal advice." Portland Pipe Line Corp. v. City of S. Portland, No. 2:15-cv-00054-JAW, 2017 U.S. Dist. LEXIS 135704, at *9, *17 (D. Me. Aug. 14, 2017)

Even sophisticated corporate clients often do not understand that their agents'/consultants' involvement during privileged communications or as recipients of privileged communications usually destroys that protection. Clients sometimes erroneously think that confidentiality arrangements with such agents/consultants will avoid waiving privilege protection. That is incorrect – such agreements generally are irrelevant in analyzing privilege waiver issues.

Case Date Jurisdiction State Cite Checked
2017-08-02 Federal NY
Comment:

key case


Chapter: 8.4

Case Name: Bousamra v. Excela Health, No. 1637 WDA 2015, 2017 Pa. Super. LEXIS 166 (Pa. Super. Ct. March 13, 2017)
("[T]he presence of the third party, under the rationale of the courts, must be necessary or, at the very least, useful, for purposes of the lawyer's dissemination of legal advice. There is a fatal flaw in Exela's [Client] attempt to invoke the pertinent case law. Excela decidedly failed to establish the facts necessary for application of these cases. Other than a vague affidavit contradicted by deposition testimony, Excela produced no facts to establish that Ms. Foster [Outside lawyer] or Excela hired Jarrad ["Independent public relations firm"] to aid in rendering the legal advice, i.e., whether the doctors could be named."; "Mr. Fedele [General counsel] did not indicate that he consulted with Jarrard about the legal implications of using the doctors' names. Rather, he had sought that advice from outside counsel, as evidenced by his request for an opinion letter on the subject from Ms. Foster. During his deposition, Mr. Fedele stated that he did not recall have any dialogue 'with Jarrard, Cate, Phillips between the 25th of February to the 28th of [February] eliminating the question regarding the legal issues preventing publicly identifying the physicians[.]'. . . He did not recall having legal discussions with Jarrard about any other matter. . . . Jarrard was hired by Excela to handle the media event and was not consulted to aid in the legal discussion. Jarrard's presence was not necessary or even highly useful to the question of whether to publicly name the doctors."; "Excela's position, at its essence, is that it did not waive the privilege because the disclosure was made to 'an agent assisting the attorney in giving legal advice to the client.'. . . We disagree. Jarrard was not an agent of the attorney, Ms. Foster. Ms. Foster did not seek advice or help from Jarrard in rendering her legal opinion. Jarrard was a separate legal entity, a media consulting firm, hired by Excela. Excela simply fails to establish, by reference to deposition testimony of Ms. Cates, Ms. Foster, or of any other member of the Jarrard team that Jarrard was involved in the process of the Ms. Foster's tender of legal advice."; "We find it most significant that there was no proof of any communication between Ms. Foster and Jarrard on the subject matter so that Ms. Foster did not seek Jarrard's input, to any extent, in forming her legal opinion. Likewise, Excela did not ask Jarrard's team for any feedback or response to Ms. Foster's previously-formed legal opinion. Excela does not refer to any place in the record establishing that Jarrard was involved, as a member of a team, with either Excela or Ms. Foster in connection with outside counsel's legal judgment on the matter. Thus, Excela does not support its factual position that Jarrard was in some way a participant into the question of the legal advisability of naming the two doctors during the public announcement. Its reliance upon the case law in question is therefore misguided.")

Case Date Jurisdiction State Cite Checked
2017-03-13 State PA

Chapter: 8.4

Case Name: Margulis v. The Hertz Corporation, Civ. A. No. 14-1209 (JMV), 2017 U.S. Dist. LEXIS 28311 (D.N.J. Feb. 28, 2017)
(holding that a corporate family was not "one" client, but that the United States law firm jointly represented a U.S. company and an overseas affiliate; "This document is privileged."; "The subject of the document states: 'Margulis v. Hertz . . . ." This appears to be a communication by a necessary intermediary seeking information relating to the Hertz litigation. While a non-Hertz employee is involved (Mr. Slovak) he is acting as an agent in this context in the sense that he is acquiring and providing information to a Hertz employee to relay back to Hertz counsel on a legal issue in the case. Mr. Slovak's involvement is different from that of Ms. Weston's (see, e.g., Log Entry 684), because it appears that Mr. Slovak is capable of, and is, providing information to counsel that could not be provided by any other individual, rending him a necessary intermediary.")

Case Date Jurisdiction State Cite Checked
2017-02-28 Federal NJ

Chapter: 8.4

Case Name: CAC Atlantic LLC v. Hartford Fire Ins. Co., 16 Civ. 5454 (GHW) (JCF), 2017 U.S. Dist. LEXIS 11010 (S.D.N.Y. Jan. 19, 2017)
(in an opinion by Magistrate Judge Francis, inexplicably citing Kovel in the context of a client rather than a lawyer agent; "The documents now at issue are all communications to or from Minogue ["a building consultant retained by Hartford prior to its disclaimer of coverage"], and since Minogue is not 'the client,' they are not privileged on their face. Nevertheless, there are two theories that might bring these communications within the privilege. First, an attorney may rely on a non-lawyer to facilitate communications with the client, including persons with expertise such as accountants used to convey technical information. See United States v. Kovel, 296 F.2d 918, 922 (2d Cir. 1961); Osorio, 75 N.Y.2d at 84, 550 N.Y.5.2d at 615. Here, however, Hartford has not demonstrated that Minogue was engaged simply to 'translate' information for purposes of providing legal advice."; "Second, even though Minogue is not itself a party, its communications with counsel and the defendant might be privileged if it were the functional equivalent of an employee of Hartford."; "Hartford has not established that Minogue served such an integral role in light of these factors that it must be treated as if it were an employee for purposes of the privilege.")

Case Date Jurisdiction State Cite Checked
2017-01-19 Federal NY
Comment:

key case


Chapter: 8.4

Case Name: Valenzuela v. Union Pacific Railroad Co., No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-21 Federal AZ
Comment:

key case


Chapter: 8.4

Case Name: Kagan v. Minkowitz, 500940/2016, 2016 N.Y. Misc. LEXIS 4577, 2016 NY Slip Op 32429(U) (N.Y. Dec. 9, 2016)
(finding that plaintiff's brother was outside privilege protection, and did not share a common interest with the plaintiff; in contrast, finding that disclosure to the brother did not waive work product protection; "Here, Kagan has submitted to the Court, for in camera review, various email exchanges between himself and his counsel that were either forwarded to Gam [Plaintiff's brother and funder of the litigation] or wherein Gam was copied. Upon review of the papers submitted and consideration of the foregoing principles, the Court finds that the attorney-client emails which were forwarded to Gam are not protected by the attorney-client privilege because no counsel was present when Gam received the information. Kagan fails to provide support for the proposition that the attorney-client privilege applies to email communications between a client and his attorney that were later forwarded to a third party. Moreover, even if the attorney-client privilege were applicable, because these attorney-client emails were forwarded to Gam after the fact, Kagan cannot show that Gam served to facilitate attorney-client communication or representation at the time such communication took place so that the agency exception would apply. In any case, Kagan has failed to establish that Gam, generally, is his agent or his counsel's agent whose services are necessary for the provision or receipt of legal services.")

Case Date Jurisdiction State Cite Checked
2016-12-09 State NY

Chapter: 8.4

Case Name: In re Riddell Concussion Reduction Litigation, Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-05 Federal NJ
Comment:

key case


Chapter: 8.4

Case Name: Rao v. The Bd. of Trustees of the Univ. of Ill., No. 14-cv-0066, 2016 U.S. Dist. LEXIS 145298 (N.D. Ill. Oct. 20, 2016)
(holding that plaintiff's wife did not share a common interest with her husband, and was not within the privilege protection as her husband's agent, and had admitted that lawyer/children were not acting as her lawyer during the communications; inexplicably not addressing work product protection; "Plaintiff argues that Ms. Jasti's presence on communications between Plaintiff and his lawyers does not destroy the privilege because she 'has driven [Plaintiff] to all meetings with attorneys in this matter,' and 'has also been extremely helpful to counsel in communicating with Dr. Rao, locating and transmitting documents to his counsel, filling in factual gaps when Dr. Rao cannot recall a relevant incident, typing documents for Dr. Rao, providing information about the family's finances, conducting internet research on issues and parties in the case, among other things.". . . The Court does not believe that Plaintiff has carried his burden of proving that Ms. Jasti's role in this litigation is the type that preserves the privilege despite her third party status. This Court's review of the case law in the Seventh Circuit suggests that the privilege protects communications with third parties when the third party is an agent, employee, or outside expert retained for the purposes of litigation. . . . While the exception appears to be flexible, the Court has found no case law that would stretch the exception to reach Ms. Jasti's role in this case."; "The Court has found no case in this circuit where the privilege has extended to family members of parties who are primarily assisting with basic ministerial and administrative tasks, which appears to Ms. Jasti's role in this litigation. The Court accepts that Ms. Jasti was important to the litigation, but that alone is not enough to preserve the privilege. . . . While it is possible that Ms. Jasti was acting as an agent of the Plaintiff, neither the factual recitation nor the legal arguments in Plaintiff's brief present any such assertion. Nor has Plaintiff argued that Ms. Jasti acted as an interpreter or expert that was necessary for Plaintiff's counsel to provide adequate and meaningful legal advice. Given Plaintiff's burden to show that the privilege should apply, and the Seventh Circuit's admonition that the attorney-client privilege should be construed narrowly, the Court cannot find that Plaintiff's communications with his lawyer in the presence of Ms. Jasti were made 'in confidence.' As such, they are not protected by the attorney-client privilege. Ms. Jasti is ordered to produce the documents sought in the Defendants' third-party subpoena on or before October 24, 2016.")

Case Date Jurisdiction State Cite Checked
2016-10-20 Federal IL
Comment:

key case


Chapter: 8.4

Case Name: In re International Oil Trading Company, LLC, Case No. 15-21596-EPK, Ch. 7, 2016 Bankr. LEXIS 1856 (S.D. Fla. April 28, 2016)
("The Court believes the case law applying the broader approach to the 'agency exception' is more consistent with the purpose for the exception and thus better reasoned. The broader approach to the 'agency exception' is also in agreement with Florida law."; "In this case, Mr. Al-Saleh possesses a judgment against IOTC USA and is attempting to collect on that judgment. IOTC USA is an entity that has demonstrated an ability and willingness to resist Mr. Al-Saleh's collection efforts. In order to obtain counsel and collect the money he is owed, Mr. Al-Saleh secured outside funding from a lender. In order to determine whether to lend money to Mr. Al-Saleh, the litigation funder must assess the potential litigation, both at the outset and on an ongoing basis, using information provided by Mr. Al-Saleh and his counsel. With that information, the funder may advise Mr. Al-Saleh as to the cost of pursuing collection, the risks involved, and the best strategies to pursue in litigation. The thousands of pages of communications at issue in the Third Motion to Compel imply that the funder's involvement has significant value to Mr. Al-Saleh and is integral to his pursuit of legal advice."; "Communications with a litigation funder fall within the agency exception for the very reason that litigation funders exist -- because without litigation funders, parties owed money, or otherwise stymied by deep-pocketed judgment debtors, might have reduced or no ability to pursue their claims. Litigation funders may be essential to the provision of legal advice in such cases. . . . Mr. Al-Saleh has engaged Burford 'in furtherance of the rendition of legal services,' and the communication of otherwise privileged information to Burford did not result in waiver of the attorney-client privilege.")

Case Date Jurisdiction State Cite Checked
2016-04-28 Federal FL
Comment:

key case


Chapter: 8.4

Case Name: In re International Oil Trading Co. 548 B.R. 825 (Bankr. S.D. Fla. 2016)
June 22, 2016 (PRIVILEGE PONT)

"Court Takes a Liberal View of Privilege for Communications Between a Plaintiff and a Litigation Funder"

With litigants' increasing reliance on litigation funders, courts have had to wrestle with privilege and work product issues, including whether litigants and their litigation funders share a "common interest" allowing the former to avoid a waiver when disclosing privileged communications to the latter, and whether litigation funders can create protected work product.

In In re International Oil Trading Co. 548 B.R. 825 (Bankr. S.D. Fla. 2016), the court held that the plaintiff and its litigation funder Burford Capital shared a sufficiently common legal interest, so that the plaintiff did not waive its privilege protection by disclosing privileged communications to Burford. And the court even went beyond that — finding that Burford was a protected client agent assisting the company "'in furtherance of the rendition of legal services,'" and therefore within the privilege on that separate ground. Id. At 834 (citation omitted). The court also held that Burford could create protected work product, concluding that "[i]t does not matter that Burford's obvious purpose is to obtain a return on its investment, just as it does not matter that counsel's purpose typically is to earn a fee." Id. At 836.

Not all courts share this liberal attitude toward privilege and work product protection in the context of litigation funders, but the trend seems to be in that direction.

Case Date Jurisdiction State Cite Checked
2016-01-01 Federal FL
Comment:

key case


Chapter: 8.4

Case Name: FTC v. AbbVie, Inc., Civ. A. No. 14-5151, 2015 U.S. Dist. LEXIS 166723 (E.D. Pa. Dec. 14, 2015)
("Under the third-party consultant exception, disclosure does not waive the attorney-client privilege so long as 'disclosure is necessary to further the goal of enabling the client to seek informed legal assistance.'")

Case Date Jurisdiction State Cite Checked
2015-12-14 Federal PA

Chapter: 8.4

Case Name: Las Olas River House Condo Assoc., Inc. v. Lorh, LLC, No. 4D15-2289, 2015 Fla. App. LEXIS 18400 (Fla. App. 4d Dec. 9, 2015)
(finding that disclosure to a condominium's property manager did not automatically waive privilege protection, and remanding; "Under our Evidence Code, '[a] client has a privilege to refuse to disclose, and to prevent any other person from disclosing, the contents of confidential communications when such other person learned of the communications because they were made in the rendition of legal services to the client. § 90.502(2), Fla. Stat. (2014) (emphasis added)."; "'A communication between lawyer and client is 'confidential' if it is not intended to be disclosed to third persons other than: (1) Those to whom disclosure is in furtherance of the rendition of legal services to the client. (2) Those reasonably necessary for the transmission of the communication.'"; "§ 90.502(2), Fla. Stat. (2014) (emphasis added). The second exception applies to agents of the client -- for example, when a family member acts on behalf of an incapacitated relative . . . Or when a messenger is needed for a client to contact counsel.")

Case Date Jurisdiction State Cite Checked
2015-12-09 Federal FL

Chapter: 8.4

Case Name: Heinzl v. Cracker Barrel Old Country Store, Inc., Civ. A. No. 2:14-cv-1455, 2015 U.S. Dist. LEXIS 146825 (W.D. Pa. Oct. 29, 2015)
(in connection with a Rule 30(b)(6) deposition; holding that a third party consultant's ADA report did not deserve privilege or work product protection; rejecting an affidavit by a Cracker Barrel lawyer supporting such protections; "For instance, Mr. Dorsey [Cracker Barrel's witness] testified at the Rule 30(b)(6) deposition that Robert Buck, a third-party consultant hired by Defendant, surveyed about a dozen Cracker Barrel stores for ADA compliance issues. Mr. Dorsey explained that Mr. Buck provided the inspection reports to Mr. Dorsey, Defendant's Senior Director of Construction Facility Services, and Jeff Smith, Mr. Dorsey's predecessor. . . . Plaintiff notes that Mr. Dorsey did not testify that Defendant's counsel received Mr. Buck's reports."; "Plaintiff notes that Mr. Dorsey's testimony also reveals that Defendant largely relied on the surveys to provide financial guidance for undertaking remediation projects and to monitor store conditions. . . . In other words, the surveys helped facilitate business decisions, not legal decisions. Plaintiff argues that the surveys cannot be considered communications for purposes of obtaining legal advice and that the attorney-client privilege does not apply.")

Case Date Jurisdiction State Cite Checked
2015-10-29 Federal PA

Chapter: 8.4

Case Name: Heinzl v. Cracker Barrel Old Country Store, Inc., Civ. A. No. 2:14-cv-1455, 2015 U.S. Dist. LEXIS 146825 (W.D. Pa. Oct. 29, 2015)
(in connection with a Rule 30(b)(6) deposition; holding that a third party consultant's ADA report did not deserve privilege or work product protection; rejecting an affidavit by a Cracker Barrel lawyer supporting such protections; "Wilson [Cracker Barrel's Associate General Counsel responsible for ADA Compliance] explains that several of the documents are contracts for services between Cracker Barrel and engineering firms (the Buck Group, QPM and D&E) and that the reports, evaluations and other documents listed on the Privilege Log were all prepared pursuant to those contracts in order to assist her in her capacity as Cracker Barrel's in-house legal counsel; that the experts were engaged in anticipation of litigation such as the instant case when, in 2011, Wilson and other Cracker Barrel representatives concluded that they needed expert evaluations to determine if any stores were vulnerable to accessibility litigation following the effective date of the 2010 ADA Standards for Accessible Design and associated governmental regulations."; "Mr. Dorsey confirmed that monitoring the compliance of parking lots with the ADA has been ongoing. . . . Mr. Dorsey testified that Defendant hired Mr. Buck, the third party consultant, 'sometime in 2012,' which was years before Plaintiff filed her Complaint against Defendant."; "Additionally, even if Defendant investigated issues that could involve litigation in the future, courts have held that such investigations do not warrant protection under the work product doctrine because they were done in the ordinary course of business."; "Defendant has not demonstrated that the documents at issue constitute attorney work-product, as opposed to ordinary business documents created during routine renovations at facilities or when certain stores received complaints from customers. Ms. Wilson's statement that she 'subjectively believed that litigation was a real possibility when the 2010 ADA Guidelines went into effect' is at odds with Mr. Dorsey's testimony that the documents were created during the normal course of business, without any involvement of counsel and contemporaneous documents discussing the project which do not reflect the involvement of counsel. Defendant's argument should be rejected and Plaintiff's motion to compel these documents should be granted.")

Case Date Jurisdiction State Cite Checked
2015-10-29 Federal PA
Comment:

key case


Chapter: 8.4

Case Name: Wichansky v. Zowine, No. CV-13-01208-PHX-DGC, 2015 U.S. Dist. LEXIS 132711 (D. Ariz. Sept. 29, 2015)
December 2, 2015 (PRIVILEGE POINT)

"Decision Highlights a Key Difference Between Attorney-Client Privilege and Work Product Doctrine Protection"

The attorney-client privilege provides absolute but fragile protection. In contrast, work product doctrine protection can be overcome — but offers more robust safety than the privilege. This distinction affects the impact of third parties' participation, and disclosure of protected communications or documents to third parties.

In Wichansky v. Zowine, No. CV-13-01208-PHX-DGC, 2015 U.S. Dist. LEXIS 132711 (D. Ariz. Sept. 29, 2015), the court dealt with plaintiff's communications with his lawyer — in the plaintiff's father-in-law's presence. The court found that the father-in-law's participation rendered the privilege unavailable — holding that the father-in-law "was not necessary to Plaintiff's communications with his counsel and [therefore] does not fall within the privilege." Id. at *6. In addressing the work product doctrine, the court applied the universal rule that "unlike the more sensitive attorney-client privilege, waiver of work product protection does not occur simply because a document is shared with a third person." Id. At *10. Because the father-in-law's "interests are aligned with Plaintiff's," disclosing work product to the father-in-law did not waive that separate protection. Id. At *11. In fact, the court concluded that the plaintiff's father-in-law could himself prepare protected work product under Fed. R. Civ. P. Rule 26(b)(3)(A) — which can cover documents prepared in anticipation of litigation "for" a party (such as the plaintiff). Id. At *7.

The attorney-client privilege and the work product doctrine apply in dramatically different ways in the context of friendly third parties — who are generally outside privilege protection but inside work product protection, and who, even themselves, can create protected work product. Corporate lawyers should remember these rules when considering their corporate clients' friendly third parties such as accountants, consultants, or other agents.

Case Date Jurisdiction State Cite Checked
2015-09-29 Federal AZ
Comment:

key case


Chapter: 8.4

Case Name: Obeid v. Mack, 14-cv-6498 (LTS) (MHD), 2015 U.S. Dist. LEXIS 127327 (S.D.N.Y. Sept. 16, 2015)
("That protection extends as well to communications between (1) the attorney or his representative and (2) a representative or agent of the client, and to communications with others who are facilitating the rendition of legal services by the lawyer.").

Case Date Jurisdiction State Cite Checked
2015-09-16 Federal NY

Chapter: 8.4

Case Name: Cardinal Aluminum Co. v. Continental Casualty Co., Case No. 3:14-CV-857-TBR-LLK, 2015 U.S. Dist. LEXIS 95361 (W.D. Ky. July 22, 2015)
September 16, 2015 (PRIVILEGE POINT)

"Courts Continue to Catalogue Client and Lawyer Agents Outside Privilege Protection"

Under the majority view, the only client agents/consultants inside privilege protection are those essential for the client-lawyer communications. Although courts take a more varied view of lawyer agents/consultants, many courts hold that the only lawyer agents within privilege protection are those essentially translating or interpreting data so the lawyer can understand it.

In Cardinal Aluminum Co. v. Continental Casualty Co., Case No. 3:14-CV-857-TBR-LLK, 2015 U.S. Dist. LEXIS 95361 (W.D. Ky. July 22, 2015), the court held that plaintiff's insurance broker was outside privilege protection — despite the plaintiff's CFO's affidavit that the plaintiff relied on the broker to submit an insurance claim, negotiate with the insurance company, and advise the plaintiff about the claims process. Among other things, the court noted that "Plaintiff did not argue that its broker acted to effectuate legal representation for Plaintiff." Id. At *8. About three weeks earlier, another court addressed a company's claim that the privilege covered communications between its lawyers and environmental engineering firm AGC. NL Indus., Inc. v. ACF Indus. LLC, No. 10CV89W, 2015 U.S. Dist. LEXIS 86677 (W.D.N.Y. July 2, 2015). Although acknowledging plaintiff's argument that AGC's "actions were done at the direction of counsel," the court found that AGC was outside privilege protection — noting that "[p]laintiff has not shown that AGC acted like an interpreter or translator of client communications." Id. At *12.

One of the most dangerous client misperceptions is that the privilege can protect their communications with their agents/consultants. And one of the most dangerous lawyer misperceptions is that lawyers can automatically assume that their agents/consultants are within privilege protection.

Case Date Jurisdiction State Cite Checked
2015-07-22 Federal KY
Comment:

key case


Chapter: 8.4

Case Name: Cohen v. Trump, Civ. No. 13-CV-2519-GPC (WVG), 2015 U.S. Dist. LEXIS 74542 (S.D. Cal. June 9, 2015)
("The third-party communications must be 'necessary, or at least highly useful, for the effective consultation between the client and the lawyer which the privilege is designed to permit.'")

Case Date Jurisdiction State Cite Checked
2015-06-09 Federal CA

Chapter: 8.4

Case Name: Cohen v. Trump, Civ. No. 13-CV-2519-GPC (WVG), 2015 U.S. Dist. LEXIS 74542 (S.D. Cal. June 9, 2015)
("The attorney-client privilege can extend to communications between representatives of the client or between the client and a representative of the client, if the communication was made in confidence for the primary purpose of obtaining legal advice.")

Case Date Jurisdiction State Cite Checked
2015-06-09 Federal CA

Chapter: 8.4

Case Name: Cohen v. Trump, Civ. No. 13-CV-2519-GPC (WVG), 2015 U.S. Dist. LEXIS 74542 (S.D. Cal. June 9, 2015)
("The third-party communications must be interpretive and serve to translate informative information between the client and the attorney.")

Case Date Jurisdiction State Cite Checked
2015-06-09 Federal CA

Chapter: 8.4

Case Name: Smith v. Unilife Corp., Civ. A. No. 13-5101, 2015 U.S. Dist. LEXIS 18755 (E.D. Pa. Feb. 13, 2015)
(finding that the attorney-client privilege protected draft 10-K filings, and that the nonlawyer consultants were the functional equivalent of employees; "A trial judge is not in a good position to second-guess a corporate decision to rely on an independent consultant or an employee to accomplish a specific task and/or to make recommendations to the CEO or general counsel. A review of the documents demonstrated that the communications were with counsel and were made for the purpose of assisting the corporation in securing legal advice or making legal decisions.")

Case Date Jurisdiction State Cite Checked
2015-02-13 Federal PA
Comment:

key case


Chapter: 8.4

Case Name: Cohen v. Cohen, 09 Civ. 10230 (LAP), 2015 U.S. Dist. LEXIS 21319 (S.D.N.Y. Jan. 30, 2015)
(in an action by a wife against her former husband for fraud in connection with assets, analyzing the wife's communications to and from a litigation funder; finding that the funder did not meet the Kovel doctrine; finding the agreement between the wife and the litigation funder not assure privilege protection; "Nor can Plaintiff rely on Ms. Napp's Consulting Agreements to create such a privilege where there is none. . . . Although the expectation of confidentiality and expressions of need reflected in those Agreements may be relevant to this Court's analysis, the core of the inquiry must focus on the actual substance of Ms. Napp's role in the attorney-client relationship. Viewed as a whole, there is nothing about Ms. Napp's advice or commentary that is critical to Plaintiff's ability to seek and receive legal advice from her counsel.")

Case Date Jurisdiction State Cite Checked
2015-01-30 Federal NY

Chapter: 8.4

Case Name: Cohen v. Cohen, 09 Civ. 10230 (LAP), 2015 U.S. Dist. LEXIS 21319 (S.D.N.Y. Jan. 30, 2015)
(in an action by a wife against her former husband for fraud in connection with assets, analyzing the wife's communications to and from a litigation funder; finding that the funder did not meet the Kovel doctrine; "Because Ms. Napp [Funder] is neither necessary to facilitate Plaintiff's communications with counsel nor in possession of a legal claim against Defendants, her communications with Plaintiff are not privileged. With regard to her Kovel argument, Plaintiff has made no showing that Ms. Napp is 'indispensable or serve[s] some specialized purpose in facilitating the attorney client communications.'. . . Rather, her primary purpose appears initially to be making a decision as to whether her company will fund Plaintiff's legal team and thereafter reviewing and commenting on legal strategy presumably to maximize the chances of a return on her investment. These functions cannot be analogized to the interpreters or accounts of the Kovel line, who serve a specific function necessary to effectuate legal representation.")

Case Date Jurisdiction State Cite Checked
2015-01-30 Federal NY

Chapter: 8.4

Case Name: Woodard v. Victory Records, Inc., No. 11 CV 7594, 2013 U.S. Dist. LEXIS 159498, at *25-26 (N.D. Ill. Nov. 7, 2013)
(finding that an agent for a musical band was outside the privilege protection; "The court turns next to Plaintiffs' assertion that even if Janick were deemed a consultant, consultants can also serve as agents under certain circumstances. The court agrees with Plaintiffs that consultants can serve as agents under certain circumstances and thus fall within the ambit of the attorney-client privilege. However, Plaintiffs have not shown that the circumstances here elevate Janick to the status of an agent. Most applicable are those cases in which third parties such as accountants and investment banking firms have qualified as agents based upon a showing that they 'assist[ed] a lawyer in giving legal advice,' and that their 'participation was required to enable the attorney to render legal advice.'" (citation omitted))

Case Date Jurisdiction State Cite Checked
2013-11-07 Federal IL B 5/14

Chapter: 8.4

Case Name: In re Baugher, No. 353909/P, 2013 N.Y. Slip Op. 51622(U), at 8 (N.Y. Sur. Ct. Sept. 30, 2013)
(analyzing the fiduciary exception; "As to disclosure to a relative or friend, the test to determine whether the privilege was waived is whether the participation of a third person was 'reasonably necessary for the protection of the client's interests.'" (citation omitted); "The estate has failed to establish that there was an agency relationship. The court makes no finding of fact as to the capacity of Phebe Baugher or her dependency on others, except for the purpose of determining the motions for pretrial disclosure."; "The privilege was waived by disclosure of the correspondence. The court declines to find that disclosure was waived as to all privileged communications on the same subject.")

Case Date Jurisdiction State Cite Checked
2013-09-30 State NY B 5/14

Chapter: 8.4

Case Name: Swift Spindrift, Ltd. v. Alvada Ins., Inc., No. 09 Civ. 9342 (AJN) (FM), 2013 U.S. Dist. LEXIS 104296, at *21-22, *22-23, *23 (S.D.N.Y. July 24, 2013)
("Swift is correct in observing that the attorney-client privilege may extend to communications shared with its agents, but it makes no attempt to identify which emails it believes are protected under this theory. Rather, Swift merely states generally that all of the third parties included on the shared communications were 'acting as [its] agents.'. . . Swift does not explain, however, how including V-Ships [management company hired by plaintiff] on their attorney-client emails assisted the process, or even make clear which entries on the privilege log relate to the V-Ships communications."; "Swift similarly has failed to demonstrate that disclosure to V-Ships was necessary in order for it to obtain informed legal advice. 'Necessary,' in the context of third party disclosures, 'means more than just useful and convenient, but rather requires that the involvement of the third party be indispensable or serve some specialized purpose in facilitating the attorney-client communications.'. . . It does not appear that V-Ships served any specialized purpose here other than perhaps to provide factual information to Cumming [in-house lawyer] and Swift's principals. That, however, is insufficient to avoid a privilege waiver."; "Additionally, because Swift has failed to show that the disclosure of emails to third parties other than V-Ships was necessary to facilitate the attorney-client relationship, the privilege also has been waived with respect to such communications. Any communications disclosed to third parties other than V-Ships consequently also must be produced.")

Case Date Jurisdiction State Cite Checked
2013-07-24 Federal NY B 4/14

Chapter: 8.4

Case Name: Jackson v. Deen, Case No. CV412-139, 2013 U.S. Dist. LEXIS 65814, at *43, *43-44, *44, *45, *46, *47, *48 (S.D. Ga. May 8, 2013)
(in an employment discrimination case against celebrity Paula Deen and her brother "Bubba" Hiers, ultimately concluding that Deen's three outside consultants were outside the attorney-client privilege protection; "[T]he defendants rely on Paula Deen's affidavit. . . . She attests that Barry Weiner is her 'agent and business adviser.'. . . Lucie Salhany is 'a business consultant for' Paula Deen Enterprises, LLC (PDE)), . . . and she works 'with designated PDE personnel on staffing and salary issues, and the improvement of hiring practices,' plus marketing and public relations functions. . . . She is 'an integral person in a group dealing with issues that are completely intertwined with PDE's litigation and legal strategies.' . . . And Jeff Rose is affiliated with 'The Rose Group,' which is a 'brands relation agency.' . . . That group provides 'marketing and public relations services for PDE.' . . . Rose thus is an integral part of the Weiner-Salhany-Rose cluster that gathers 'to discuss litigation and legal strategies.' . . . Rose, then, 'must hear the advice of legal counsel regarding these matters.'"; "Those three contractors, Deen concludes, 'are indistinguishable from my employees because each, in their individual capacity, acts for me and my business entities and possesses the information needed by attorneys in rendering legal advice.'"; "Plaintiff insists that the documents Gerard copied to them are discoverable because Deen's affidavit at most speaks of her general reliance on them, while they themselves have not provided affidavits showing they possess sufficient, specific knowledge of this case to place them within that protection zone."; "It is true that there is no per se rule restricting a corporation's assertion of its attorney-client based privilege to employees, as it is common to seek legal assistance from third parties who are neither employees nor lawyers."; "Those third parties, however, must be nearly indispensable to that effort."; "Significant here is what the defendants do not say. They do not supply: (a) any affidavit from any of the agents showing what specific role they have played with respect to this case; and (b) what communications in fact were sent to them and for what purpose. There is a difference, for example, between helping to formulate and factually support a legal strategy versus damage control-based, publicity management -- a patently commercial endeavor."; "Deen's affidavit, meanwhile, speaks only in general terms. Nothing approaching the 'nearly indispensable role' is described."; "Waiver thus has occurred, so defendants must disclose all of Gerard's communications regarding Jackson's complaints, where these individuals were in the loop.")

Case Date Jurisdiction State Cite Checked
2013-05-08 Federal GA B 8/13

Chapter: 8.4

Case Name: Jackson v. Deen, Case No. CV412-139, 2013 U.S. Dist. LEXIS 65814, at *45 (S.D. Ga. May 8, 2013)
(in an employment discrimination case against celebrity Paula Deen and her brother "Bubba" Hiers, ultimately concluding that Deen's three outside consultants were outside the attorney-client privilege protection; rejecting Deen's functional equivalent argument; "Those third parties, however, must be nearly indispensable to that effort.")

Case Date Jurisdiction State Cite Checked
2013-05-08 Federal GA B 8/13

Chapter: 8.4

Case Name: Dempsey v. Bucknell Univ., 296 F.R.D. 323, 327 (M.D. Pa. 2013)
("'As a general matter, the privilege is not destroyed when a person other than the lawyer is present at a conversation between an attorney and his or her client if that person is needed to make the conference possible or to assist the attorney in providing legal services.'" (citation omitted))

Case Date Jurisdiction State Cite Checked
2013-01-01 Federal PA B 5/14

Chapter: 8.4

Case Name: Dempsey v. Bucknell Univ., 296 F.R.D. 323, 329-30 (M.D. Pa. 2013)
("[I]t is clear from the record before the Court that Dempsey's parents played two different roles in his legal defense, both of which permitted them to participate in or receive disclosure of confidential communications without waiver of the attorney-client privilege. From the earliest stages of this affair, Dempsey's parents played an essential role in securing legal representation for Dempsey. After the retention of legal counsel, Dempsey's parents actively assisted his attorneys in preparing a defense to criminal charges and, later, student conduct charges against Dempsey. In particular, the Court notes Attorney Stephen Becker's unrebutted affidavit . . . in which Becker stated that, due to their professional backgrounds (John Dempsey is a forensic investigator and Shelley Dempsey is a retired attorney) and their relationship and knowledge of their son, he enlisted the assistance of Dempsey's parents in gathering and analyzing information and helping to prepare Dempsey's defense. It is also abundantly clear from the Court's in camera review of the documents at issue that Dempsey's parents functioned just as Attorney Becker represented, operating in concert with and at the direction of defense counsel, and providing substantial assistance in preparation of the case. Whether they came upon these roles as paid professionals or as family member volunteers is immaterial.")

Case Date Jurisdiction State Cite Checked
2013-01-01 Federal PA B 5/14

Chapter: 8.4

Case Name: Caruso v. Grace, No. 11 Civ. 2353 (SAS) (KNF), 2012 U.S. Dist. LEXIS 89176, at *17 (S.D.N.Y. June 27, 2012)
(holding that the participation of Nancy Grace's talent agency representative in otherwise privileged discussions between Nancy Grace and her lawyer meant that the privilege did not protect those communications; applying New York law in a diversity case without a choice of laws analysis; finding that the talent agency employee was not a necessary client agent, was not the functional equivalent of an employee, and was not assisting the lawyer in providing legal advice; "That Perry might have been an expert in syndication deals who advised Grace on her business deals would not establish, by itself, that Perry facilitated Grace's seeking or obtaining legal advice or services from Shire.")

Case Date Jurisdiction State Cite Checked
2012-06-27 Federal NY B 10/12

Chapter: 8.4

Case Name: Green v. Beer, No. 06 Civ. 4156 (KMW) (JCF), 2010 U.S. Dist. LEXIS 87484, at *11-12, *12 (S.D.N.Y. Aug. 24, 2010)
(reversing a portion of Magistrate Judge Francis's earlier ruling, and affirming another portion of his ruling; holding that (1) a couple did not waive their privilege protection by asking their son to print out their emails, because the son was providing necessary technical assistance to his parents (reversing Judge Francis's holding to the contrary), and (2) that the couple waived their attorney-client privilege by disclosing privileged communications to their financial advisors (affirming Judge Francis's holding); "The magistrate judge did not err in finding that Plaintiffs failed to establish that the sharing of the documents with Plaintiffs' Financial Advisors was 'necessary, let alone 'nearly indispensable[,]' to the provision of legal advice' to Plaintiffs. . . . The affidavits submitted by Plaintiffs do not establish that Plaintiffs' Financial Advisors' involvement was 'necessary,' or that Plaintiffs' Financial Advisors 'serve[d] some specialized purpose in facilitating the attorney-client communication' and the provision of proper legal advice. . . . There is also no evidence that Plaintiffs' Financial Advisors played a 'necessary' role in the delivery of facilitation of the emails. See N.Y.C.P.L.R. § 4548."; "Accordingly, the rejection of Plaintiffs' assertion of privilege as to the documents disclosed to Plaintiffs' Financial Advisors was not clearly erroneous, and is therefore affirmed.")

Case Date Jurisdiction State Cite Checked
2010-08-24 Federal NY B 7/16
Comment:

key case


Chapter: 8.4

Case Name: Schwarz & Schwarz of Va., L.L.C. v. Certain Underwriters at Lloyd's, London, Civ. A. No. 6:07cv00042, 2009 U.S. Dist. LEXIS 33019, at *15 (W.D. Va. Apr. 16, 2009)
("The attorney-client 'privilege attaches to communications of the client made to the attorney's agents . . . when such agent's services are indispensable to the attorney's effective representation of the client.' Edwards, 235 Va. at 509, 370 S.E.2d at 301." (citations omitted))

Case Date Jurisdiction State Cite Checked
2009-04-16 Federal VA B 3/16
Comment:

key case


Chapter: 8.4

Case Name: Campbell v. Dastoor, 79 Va. Cir. 569, 570, 572 (Va. Cir. Ct. 2009)
(analyzing the privilege and work product implications of a doctor sued for medical malpractice moving to another employer (PCA), which was the named insured patient in the medical malpractice insurance policy; explaining that the new employer's president and CEO attended the defendant doctor's deposition and mediation, and "has been involved in face-to-face and telephone conversations with counsel for Defendant and with the claim specialist for Hudson [medical malpractice insurance carrier]. Dr. Polverino [CEO] also received electronic mail from defense counsel, Hudson, and Defendant." (footnotes omitted); ultimately rejecting the doctor's argument that the new employer's president/CEO was an agent within the attorney-client relationship; "There is no evidence that Dr. Polverino's role was 'indispensable.' More significantly, Defendant did not possess the power to control Dr. Polverino's actions. Absent that element of control, there was no agency relationship between Defendant and Dr. Polverino."; "Dr. Polverino may be an agent for PCA, but is not an agent for Defendant personally. Furthermore, the lawsuit is between Defendant and a former patient. PCA is not named as a party to this suit. Therefore, since Dr. Polverino is neither an agent of Defendant nor an agent of Defendant's counsel, the communications between Dr. Polverino, counsel for Defendant, and Hudson are not covered."; also finding that the new employer's president/CEO was not within the attorney-client relationship, and did not share a common interest with the defendant doctor)

Case Date Jurisdiction State Cite Checked
2009-01-01 Federal VA B 10/10

Chapter: 8.4

Case Name: Campbell v. Dastoor, 79 Va. Cir. 569, 570, 571 (Va. Cir. Ct. 2009)
(analyzing the privilege and work product implications of a doctor sued for medical malpractice moving to another employer (PCA), which was the named insured in the medical malpractice insurance policy; explaining that the new employer's president and CEO attended the defendant doctor's deposition and mediation, and "has been involved in face-to-face and telephone conversations with counsel for Defendant and with the claim specialist for Hudson [the medical malpractice insurance carrier]. Dr. Polverino [CEO] also received electronic mail from defense counsel, Hudson, and Defendant." (footnotes omitted); concluding that the attorney-client privilege did not protect communications between the new employer's president/CEO and the doctor's lawyer; "'The privilege attaches to communications of the client made to the attorney's agents . . . when such agent's services are indispensable to the attorney's effective representation of the client.' The Defendant asks the Court to extend the privilege to communications involving Dr. Polverino." (footnote omitted))

Case Date Jurisdiction State Cite Checked
2009-01-01 State VA B 3/16
Comment:

key case


Chapter: 8.4

Case Name: Haugh v. Schroder Investment Management North Am. Inc., 02 Civ. 7955 (DLC), 2003 U.S. Dist. LEXIS 14586 (S.D.N.Y. Aug. 25, 2003)
(holding that a public relations consultant could not claim privilege protection for her documents but could claim work product protection; "This motion concerns the involvement of Laura J. Murray ('Murray'), a public relations consultant who is also a lawyer licensed to practice in the state of Texas. Plaintiff's former counsel, Arkin Kaplan LLC ('Arkin'), retained Murray in September 2002, and sent Murray a formal retention letter on October 3, 2002. The retention letter states that Murray will 'provide us advice to assist us in providing legal services to Ms. Haugh.' The letter provided that Murray would look only to Haugh for payment. It included the following statement regarding confidentiality: 'You further understand that our communications with you are confidential and privileged.'"; "Plaintiff has not shown that Murray performed anything other than standard public relations services for Haugh, and more importantly, she has not shown that her communications with Murray or Murray's with Arkin were necessary so that Arkin could provide Haugh with legal advice. The conclusory descriptions of Murray's role supplied by plaintiff fail to bring the sixteen documents within the ambit of the attorney-client privilege. The documents transmitted from plaintiff to Murray and one document from Murray to Arkin are consistent with the design of the public relations campaign. Plaintiff has not shown that Murray was 'performing functions materially different from those that any ordinary public relations' advisor would perform. Calvin Klein Trademark Trust v. Wachner et al., 198 F.R.D. 53, 55 (S.D.N.Y. 2000). As such, Haugh's transmission of documents to Murray, even simultaneously with disclosure to former counsel, and Murray's transmission of a meeting agenda to Arkin, vitiates the application of the attorney-client privilege to these documents.")

Case Date Jurisdiction State Cite Checked
2003-08-25 Federal NY

Chapter: 8.4

Case Name: Bradford v. Goodwin, 56 Va. Cir. 370 (Vir. Cir. Ct. 2001)
(assessing plaintiffs’ motion to compel discovery of communications between the defendant’s lawyer and the defendant’s real estate agent; noting that the privilege can cover communication between the clients and agents of the lawyer, "'when such agent’s services are indispensable to the attorney’s effective representation of the client'"(citation omitted); explaining that "[i]f a communication would have been privileged had it been made directly between an attorney and his client, it would be equally privileged when it is made through the client’s agent or employee"; deferring a ruling until further factual development)

Case Date Jurisdiction State Cite Checked
2001-01-01 State VA nsvb 2/23/04
Comment:

key case


Chapter: 8.5

Case Name: Firefighters' Retirement System v. Citco Group Ltd., Civ. A. No. 13-373-SDD-EWD, 2018 U.S. Dist. LEXIS 85697 (M.D. La. May 22, 2018)
(analyzing privilege choice of law issues, and ultimately concluding that UBS was inside privilege protection as a client consultant, although citing Kovel, because UBS's assistance was "indispensable" to the provision of legal advice (citing and quoting other cases); "A 'representative of a client' is defined in Louisiana Code of Evidence, article 506, as '[a] person having authority to obtain professional legal services, or to act on advice so obtained, on behalf of the client' or '[a]ny other person who makes or receives a confidential communication for the purpose of effectuating legal representation for the client, while acting in the scope of employment for the client.' Here, the Citco Defendants have asserted various communications between themselves, UBS employees, and Linklaters (Citco's counsel) are privileged because UBS was a representative of Citco 'and had authority to obtain professional legal services and to act on advice so obtained on behalf of Citco.' The burden of establishing that these communications are subject to the attorney-client privilege lies with the Citco Defendants, the party asserting the privilege."; "The Fifth Circuit has cited Kovel with approval in the context of a case applying the federal common law of attorney-client privilege, and courts in this Circuit have relied on Kovel when determining whether communications with third parties are privileged. Following these principles, other courts have found that communications with third-party financial advisors or investment bankers are protected by the attorney-client privilege where such communications were indispensable to the provision of the attorney's legal advice."; "Crane Security Technologies v. Rolling Optics, Civil Action No. 14-12428, 230 F. Supp. 3d 10, 22-26 (D. Mass. Feb. 3, 2017) (where plaintiff engaged financial services firm 'specifically' to assist in acquiring certain patents, and plaintiff's outside counsel communicated with financial services firm regarding the drafting and negotiating of the acquisition agreements, the court found the communications to be privileged because the communications were intended to remain confidential, review of the documents indicated that attorney asked financial services firm 'for help crafting legal advice,' and attorney averred in a declaration that legal advice was shared with financial services firm when 'necessary to accomplish' the legal advice and that his practice was to collaborate confidentially with third-party financial advisors on significant corporate transactions); In re Piedmont Office Realty Trust Inc. Securities Litigation, Civil Action No. 1:07-cv-02660, 2011 WL 13169494, at *2-4 (N.D. Ga. Oct. 27, 2011) (communications with investment bankers and other financial advisors privileged where a review of the documents at issue revealed that client's attorney 'relied upon the observations and experience of these third parties in evaluating the propriety, accuracy, and materiality of the disclosure [client] was to make in its public communications and SEC filings' and the communications 'were sent for a predominately legal purpose and with an expectation of confidentiality.'); Blau v. Harrison (In re JP Morgan Chase & Co. Sec. Litig.), MDL No. 1783, 06 C 4674, 2007 U.S. Dist. LEXIS 60095, 2007 WL 2363311, at *7-8 (N.D. Ill. Aug. 13, 2007) (where client hired third-party to provide investment advisor services in connection with a merger, communications with third party investment advisor protected by attorney-client privilege); Stafford Trading, Inc. v. Lovely, No. 05-C-4868, 2007 U.S. Dist. LEXIS 13062, 2007 WL 611252 at *7 (N.D. Ill. Feb. 22, 2007) (where plaintiff and other Stafford-owned entities retained investment banker Goldman Sachs ('GS') to locate potential purchasers for Stafford and to assist in facilitating the transaction, and GS was 'heavily involved' in negotiations between Stafford and a potential purchaser, privilege extended only to those documents (considered on a document by document basis) reflecting communications where 'GS confidentially communicated with [client's outside counsel] or Stafford's in-house counsel for the purpose of obtaining or providing legal advice.'); Calvin Klein Trademark Trust v. Wachner, No 00, Civ. 4052, 124 F. Supp. 2d 207 (S.D.N.Y. Dec. 20, 2000) (communications privileged notwithstanding the participation of investment bankers because investment bankers' role 'involved rendering expert advice as to what a reasonable business person would consider 'material'" and 'a responsible law firm . . . would not be able to adequately resolve [the question of materially] without the benefit of an investment banker's expert assessment of which facts were 'material' from a business person's perspective.'"; "Per the engagement letter between Citco Trading and UBS, UBS was to provide the following 'financial advice and assistance' with respect to a potential sale transaction involving Richcourt and a third party."; "As evidence of the roles served by UBS, the Citco Defendants submit a Declaration from Citco Groups' General Counsel, Mr. Braham, wherein he asserts that Citco Trading retained Linklaters 'to provide legal advice on the sale of Richcourt' and retained UBS 'to, among other things, conduct the sale of Richcourt Holding and to provide Citco Trading and Citco Group with advice regarding that transaction.' Mr. Braham avers that UBS's role 'was to conduct an auction process for the sale of the Richcourt group of companies, assess the bids that were received by prospective purchasers and provide recommendations on those bids, and assist Citco Group's in-house and outside counsel in negotiating a purchase agreement with the ultimate purchaser.'"; "Per the terms of the engagement letter and Mr. Braham's Declaration, UBS was retained by Citco Trading to provide various services. Some of these services – specifically with respect to developing and contacting potential purchasers, and preparing and circulating sales documentation – do not appear to be focused on providing services necessary for the rendering of legal, rather than business, advice. However, other services (i.e., assisting in the negotiation of the terms of the transaction) may fairly be within the scope of that necessary for Linklaters to provide legal advice to Citco Trading. The Citco Defendants concede that certain communications with UBS do not fall within the scope of the privilege, and explain that they have 'produced several thousand communications involving UBS where UBS was in fact providing routine business advice or was 'merely copied.' However, with respect to the withheld UBS Documents, the Citco Defendants assert that these 'communications involve UBS working hand-in-hand with Linklaters and in-house counsel to provide legal advice to Citco Group.' The detailed descriptions set forth on the Citco Defendants' privilege log reflect that the withheld communications were primarily for the purpose of obtaining or rendering legal advice.")

Case Date Jurisdiction State Cite Checked
2018-05-22 Federal LA
Comment:

key case


Chapter: 8.5

Case Name: In re Andrew Silver, No. 16-0682, 2018 Tex. LEXIS 171 (Tex. Sup. Feb. 23, 2018)
(finding that patent agents were inside privilege protection, because they counted as "lawyers" under Texas evidence rules; "The Patent and Trademark Office has approved patent agents to practice before it. 37 C.F.R § 11.5 (2018). The Patent and Trademark Office, in turn, was given authority to do so by Congress. 35 U.S.C. § 2(b)(2)(D) (2012). A registered patent agent's authority to represent clients before the USPTO therefore comes from the United States, which is one of the sovereigns identified in our rule. SeeTex. R. Evid. 503(a)(3) (defining lawyer as a person authorized to practice law in any state or nation). And, because patent agents are authorized to practice law before the USPTO, they fall within Rule 503's definition of 'lawyer,' and, as such, their clients may invoke the lawyer-client privilege to protect communications that fall within the privilege's scope.")

Case Date Jurisdiction State Cite Checked
2018-02-23 Federal TX

Chapter: 8.5

Case Name: FiberLight, LLC v. Washington Metropolitan Area Transit Authority, Civ. A. No. 16-2248 (ESH), 2018 U.S. Dist. LEXIS 8079 (D.D.C. Jan. 18, 2018)
March 28, 2018 (PRIVILEGE POINT)

"Courts Wrestle with Privilege Protection for Client Consultants: Part II"

Last week's Privilege Point summarized two cases finding that corporate client consultants: (1) did not meet the "functional equivalent" standard; and (2) were not "nearly indispensable" for facilitating communications between the corporate client and its lawyers. Such holdings make privilege protection unavailable for communications between the corporate client (or its lawyer) and the consultant, and also normally compel the conclusion that disclosing preexisting privileged communications to such consultants waives the privilege.

However, some cases take a more favorable view. In FiberLight, LLC v. Washington Metropolitan Area Transit Authority, Civ. A. No. 16-2248 (ESH), 2018 U.S. Dist. LEXIS 8079 (D.D.C. Jan. 18, 2018), defendant hired a consultant to analyze current and potential future development of its fiber optic system. Plaintiff, alleging breach of contract, sought the consultant's report to the defendant, challenging the defendant's redaction of the section entitled "Legal Concerns." Id. at *2. In a one paragraph analysis, the court confirmed after its in camera review that the redacted portion "reflects the views of [Defendant's] legal counsel regarding potential legal issues." Id. at *6. The court then upheld the redaction, explaining that "the sharing of such privileged information with a consultant who needs that information in order the complete a project for the company does not constitute a waiver of the privilege." Id. at *7.

Although this favorable approach represents the minority view, corporations and their lawyers should check the applicable court's privilege law for such helpful precedent.

Case Date Jurisdiction State Cite Checked
2018-01-18 Federal DC
Comment:

key case


Chapter: 8.5

Case Name: In re Abilify Aripiprazole Prods. Liab. Litig., Case No. 3:16-md-2734, 2017 U.S. Dist. LEXIS 213493 (N.D. Fla. Dec. 29, 2017)
(finding that public relations consultants were inside privilege protection; "[W]hen a public relations firm has been retained to assist the corporate client and its counsel with an ongoing investigation the public relations firm stands in the same shoes as the corporate client with regard to communications between the public relations firm and counsel for the corporate client, or between the public relations firm and the corporate client 'that were made for the purpose of facilitating the rendition of legal services to the corporate client.'"; "The same principles apply to marketing firms (e.g. W2 Group, Twist Marketing), retained by Defendants. To the extent these firms were retained to assist Otsuka's in-house legal departments in monitoring and analyzing media coverage as part of in-house counsel's strategies and legal advice relating to threatened and ongoing litigation and actions by regulatory agencies, the consultants would stand in the shoes of an Otsuka corporate employee. The key is not whether the entity is a consultant but rather whether the function performed by the consultant related to assisting legal counsel in providing legal advice and strategy concerning the legal position of Otsuka in the media coverage concerning the litigation. In the world today -- where a drug manufacturer may face liability in the hundreds of millions of dollars in a product liability suit -- it is not only common but necessary to involve public relations and marketing consultants to assist in-house counsel and outside counsel in responding to media inquiries regarding ongoing or threatened legal actions. So long as the role of the consultant is to assist legal counsel in responding to the media the protections of the attorney-client privilege should apply the same as where a corporate employee is tasked with responding to media inquiries. The Court has utilized these principles in making its in camera review.")

Case Date Jurisdiction State Cite Checked
2017-12-29 Federal FL
Comment:

key case


Chapter: 8.5

Case Name: In re Niaspan Antitrust Litig., Master File No. 13-MD-2460, 2017 U.S. Dist. LEXIS 135753 (E.D. Pa. Aug. 24, 2017)
("'The Court notes that entry 1572 is covered by the attorney-client privilege. 'The broad approach to determining whether an independent consultant is the functional equivalent of an employee [focuses] on whether the communications at issue were kept confidential and made for the purpose of obtaining or providing legal advice.'. . . Here, Koven requested that the consultant prepare a report so that Koven could decide whether to initiate litigation. Thus, the communication conveying the report was made for the purpose of enabling Koven to provide legal advice.'")

Case Date Jurisdiction State Cite Checked
2017-08-24 Federal PA

Chapter: 8.5

Case Name: In re Syngenta AG MIR 162 Corn Litig., MDL No. 2591, Case No. 14-md-2591-JWL, 2017 U.S. Dist. LEXIS 92606 (D. Kansas June 13, 2017)
("As a general rule, the presence of third parties breaches the confidentiality of communications between an attorney and client and waives the privilege. However, '[t]he presence of a third-party, such as a consultant, does not destroy the attorney-client privilege where that party is the client's agent or possesses 'a commonality of interest with the client.' 'The presence of a third party in an e-mail transmission, for instance, will not destroy the attorney-client privilege if the third party is the attorney's or client's agent. . . .' Syngenta has presented Nadel's declaration stating that Syngenta engaged the VHB and URI employees as consultants 'to provide . . . scientific assistance sought by Syngenta's legal department regarding regulatory requirements.' The court has no reason to question this representation. The court finds Syngenta met its burden of demonstrating these particular third parties are Syngenta's agents for purposes of this litigation, and their presence on the e-mail communication did not destroy the attorney-client privilege applicable to PRIV003553.")

Case Date Jurisdiction State Cite Checked
2017-06-13 Federal KS

Chapter: 8.5

Case Name: Audi of Am., Inc. v. Bronsberg & Hughes Pontiac, Inc., Civ. No. 3:16-CV-2470, 2017 U.S. Dist. LEXIS 87740 (M.D. Pa. June 8, 2017)
(finding that a broker was inside privilege protection; "Wyoming Valley has asserted that six other documents that were shared between its counsel and its broker, the Tim Lamb Group, which was engaged to advise the dealership with respect to the Purchase Agreement, may be withheld pursuant to the attorney-client privilege. Because the Court finds that the attorney-client privilege extends to such correspondence, Wyoming Valley's assertion of the privilege will be sustained, and Audi's efforts to compel production of these six documents will be denied."; "[T]he nature of the communications that Wyoming Valley seeks to withhold from production make clear that they were not exchanged solely or even primarily in furtherance of negotiating a commercial transaction, but rather to develop a coordinated response to the threat of litigation from a party that had expressed specific concerns about the deal they had negotiated. As such, the Court is not troubled by finding that the common-interest privilege may shield these discrete pieces of communication between counsel from disclosure, as these documents related directly to the parties' shared legal interests, rather than to their divergent commercial interests. We also note that Audi is not unfairly prejudiced by the invocation of this privilege in this particular since the privilege that we find only extends to communications which took place after Audi created this common legal interest by alleging that this transaction violated the law and constituted a material breach of contract."; "In this case, Wyoming Valley represents that it has already produced communications involving Rob Lee [Broker] that arose in a non-privileged context, including those that involved Lee and Napleton. On the privilege log, however, Wyoming Valley has identified only six documents, which are email communications, involving Lee and Wyoming Valley's counsel. Each of these emails was generated in June 2016, at a time when Wyoming Valley's outside counsel was helping to facilitate negotiations of the Purchase Agreement. The content of the emails themselves makes clear that Lee should be deemed a privileged person who was engaged for purposes of assisting the client and its counsel specifically with respect to Wyoming Valley's negotiations of its interests under the Purchase Agreement. As such, these six pieces of correspondence are privileged, and Wyoming Valley will not be required to disclose them to Audi.")

Case Date Jurisdiction State Cite Checked
2017-06-08 Federal PA

Chapter: 8.5

Case Name: Margulis v. The Hertz Corporation, Civ. A. No. 14-1209 (JMV), 2017 U.S. Dist. LEXIS 28311 (D.N.J. Feb. 28, 2017)
(holding that a corporate family was not "one" client, but that the United States law firm jointly represented a U.S. company and an overseas affiliate; "This document is privileged."; "The subject of the document states: 'Margulis v. Hertz . . . ." This appears to be a communication by a necessary intermediary seeking information relating to the Hertz litigation. While a non-Hertz employee is involved (Mr. Slovak) he is acting as an agent in this context in the sense that he is acquiring and providing information to a Hertz employee to relay back to Hertz counsel on a legal issue in the case. Mr. Slovak's involvement is different from that of Ms. Weston's (see, e.g., Log Entry 684), because it appears that Mr. Slovak is capable of, and is, providing information to counsel that could not be provided by any other individual, rending him a necessary intermediary.")

Case Date Jurisdiction State Cite Checked
2017-02-28 Federal NJ

Chapter: 8.5

Case Name: Huntington Chase Condominium Assoc. v. Mid-Century Ins. Co., No. 16 C 4877, 2017 U.S. Dist. LEXIS 14082 (N.D. Ill. Feb. 1, 2017)
(inexplicably finding that roofing contractor's principal was within the control group of a condo association; "Mr. Argento, as a non-employee agent, served as an advisor to plaintiff's top management. The consulting agreement between plaintiff and Mr. Argento, dated October 31, 2014, was signed by plaintiff's president and states in relevant part that plaintiff 'authorize[d] and retain[ed]' Mr. Argento to [d]etermine the availability of proceeds payable for construction services . . . arising from the damage at the Property'. . . . The agreement further authorizes its insurer to communicate with Mr. Argento 'on matters related to the damage to the Property and repair services.'"; "[I]t is clear from the entire agreement that plaintiff's top management would not normally have made a decision regarding the scope of available coverage or amount of repairs to be made without Mr. Argento's opinion or advice.")

Case Date Jurisdiction State Cite Checked
2017-02-01 Federal IL

Chapter: 8.5

Case Name: Huntington Chase Condominium Assoc. v. Mid-Century Ins. Co., No. 16 C 4877, 2017 U.S. Dist. LEXIS 14082 (N.D. Ill. Feb. 1, 2017)
(inexplicably finding that roofing contractor's principal was within the control group of a condo association; "Mr. Argento is not an attorney or member of plaintiff's control group. Plaintiff responds that its relationship with Mr. Argento was formalized through a written consulting agreement that provided Mr. Argento acted as plaintiff's representative during communications with defendant and that Mr. Argento thus is within plaintiff's control group."; "Under the Consolidation Coal [Consolidation Coal Co. v. Bucyrus-Erie Co., 89 Ill. 2d 103, 432 N.E.2d 250, 257, 59 Ill. Dec. 666 (Ill. 1982) (citation omitted)] analysis as adapted for non-employee agents, the Court finds Mr. Argento was part of plaintiff's control-group for purposes of the application of the attorney-client privilege to the discovery at issue.")

Case Date Jurisdiction State Cite Checked
2017-02-01 Federal IL

Chapter: 8.5

Case Name: Valenzuela v. Union Pacific Railroad Co., No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-21 Federal AZ
Comment:

key case


Chapter: 8.5

Case Name: Valenzuela v. Union Pacific Railroad Co., No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640 (D. Ariz. Dec. 21, 2016)
(finding that a plaintiff's right-of-way agents were inside the privilege protection; "Plaintiffs contend that the privilege does not extend to both Union Pacific and Kinder Morgan, but do not dispute Defendants' assertion that they were sister corporations at the time of the communications, owned by a single corporate parent. Nor do Plaintiffs dispute that the attorneys involved were employed by the parent. Finally, Plaintiffs contend that Exhibit F was written by EMI, an unrelated third-party, but do not dispute that EMI was retained by Kinder Morgan's predecessor as its right-of-way agent. Both Arizona and California law include agents within the corporate attorney-client privilege. See A.R.S. § 12-2234(B) (corporate privilege includes agents); Nemirofsky v. Seok Ki Kim, 523 F. Supp. 2d 998, 1002 (N.D. Cal. 2007), as amended (Nov. 24, 2007) (privilege 'includes communications with the entity's agent, at least where the agent is acting within the scope of his agency.').")

Case Date Jurisdiction State Cite Checked
2016-12-21 Federal AZ

Chapter: 8.5

Case Name: Valenzuela v. Union Pacific Railroad Co., No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-21 Federal AZ
Comment:

key case


Chapter: 8.5

Case Name: Kagan v. Minkowitz, No. 500940/2016. 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-09 Federal NY
Comment:

key case


Chapter: 8.5

Case Name: In re Riddell Concussion Reduction Litigation, Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016)
February 15, 2017 (PRIVIELGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-05 Federal NJ
Comment:

key case


Chapter: 8.5

Case Name: In re Riddell Concussion Reduction Litigation, Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016)
February 15, 2017 (PRIVILEGE PONT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-05 Federal NJ
Comment:

key case


Chapter: 8.5

Case Name: In re Riddell Concussion Reduction Litig., Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457 (D.N.J. Dec. 5, 2016)
(acknowledging that a public relations agent can be within privilege protection, but finding that the public relations consultant in this case was providing independent public relations advice in some of the withheld documents rather than assisting a lawyer in giving legal advice; also finding that some other consultants could be within privilege; "Cohn & Wolfe, Empire Green and Headrush Creative."; "These companies served as marketing agents or consultants for Riddell. . . . Their 21 documents reflect that Riddell consulted with the companies with regard to a documentary video and some literature. For the reasons already discussed the documents merely reflect business and commercial communications that are not privileged. However, a number of these documents reflect and discuss privileged attorney advice and communications.")

Case Date Jurisdiction State Cite Checked
2016-12-05 Federal NJ

Chapter: 8.5

Case Name: In re Riddell Concussion Reduction Litigation, Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016)
February 15, 2017 (PRIVILEGE POINT)

"What Client Agents Deserve Privilege Protection?"

Nearly every court considers client agents outside privilege protection unless those agents are necessary for facilitating privileged communications between clients and their lawyers. Some courts occasionally take a broader view – but without starting a trend.

In In re Riddell Concussion Reduction Litigation, the court assessed privilege protection for defendant's communications with "a public relations firm that consults with clients on communication strategies." Civ. No. 13-7585 (JBS/JS), 2016 U.S. Dist. LEXIS 168457, at *21 (D.N.J. Dec. 5, 2016). Most courts find such agents outside privilege protection, but the Riddell court held that "it is unquestionably the case that communications between and amongst Riddell and [the PR agency] for the purpose of securing legal advice are privileged." Id. at *14-15. A few weeks later, Valenzuela v. Union Pacific Railroad Co. held that a company's "right-of-way agent" deserved privilege protection under both Arizona and California law. No. CV-15-01092-PHX-DGC, 2016 U.S. Dist. LEXIS 176640, at *20 (D. Ariz. Dec. 21, 2016). But between those two decisions, a New York court applied the majority rule – holding that the plaintiff's brother (who was also funding the plaintiff's litigation) was outside privilege protection, because the plaintiff "cannot show that [his brother/litigation funder] served to facilitate attorney-client communications or representation," or acted as an agent "whose services are necessary for the provision or receipt of legal services." Kagan v. Minkowitz, No. 500940/2016, 2016 N.Y. Misc. LEXIS 4577, at *6-7 (N.Y. Sup. Ct. Dec. 9, 2016).

Many corporate executives mistakenly believe that they can share privileged communications with corporate agent/consultants without waiving the privilege. A handful of cases now and then provides a tempting sign that courts are becoming more forgiving, but the majority continues to find nearly all such agent/consultants outside privilege protection.

Case Date Jurisdiction State Cite Checked
2016-12-05 Federal NJ
Comment:

key case


Chapter: 8.5

Case Name: In re International Oil Trading Company, LLC, Case No. 15-21596-EPK, Ch. 7, 2016 Bankr. LEXIS 1856 (S.D. Fla. April 28, 2016)
("The Court believes the case law applying the broader approach to the 'agency exception' is more consistent with the purpose for the exception and thus better reasoned. The broader approach to the 'agency exception' is also in agreement with Florida law."; "In this case, Mr. Al-Saleh possesses a judgment against IOTC USA and is attempting to collect on that judgment. IOTC USA is an entity that has demonstrated an ability and willingness to resist Mr. Al-Saleh's collection efforts. In order to obtain counsel and collect the money he is owed, Mr. Al-Saleh secured outside funding from a lender. In order to determine whether to lend money to Mr. Al-Saleh, the litigation funder must assess the potential litigation, both at the outset and on an ongoing basis, using information provided by Mr. Al-Saleh and his counsel. With that information, the funder may advise Mr. Al-Saleh as to the cost of pursuing collection, the risks involved, and the best strategies to pursue in litigation. The thousands of pages of communications at issue in the Third Motion to Compel imply that the funder's involvement has significant value to Mr. Al-Saleh and is integral to his pursuit of legal advice."; "Communications with a litigation funder fall within the agency exception for the very reason that litigation funders exist -- because without litigation funders, parties owed money, or otherwise stymied by deep-pocketed judgment debtors, might have reduced or no ability to pursue their claims. Litigation funders may be essential to the provision of legal advice in such cases. . . . Mr. Al-Saleh has engaged Burford 'in furtherance of the rendition of legal services,' and the communication of otherwise privileged information to Burford did not result in waiver of the attorney-client privilege.")

Case Date Jurisdiction State Cite Checked
2016-04-28 Federal FL
Comment:

key case


Chapter: 8.5

Case Name: Berens v. Berens, 785 S.E.2d 733, 735, 736, 737, 741 (N.C. Ct. App. 2016)
("This appeal presents the question of whether a party to litigation who engages her friend as an agent to participate in meetings with her attorney waives the protections of attorney-client communications and attorney work product for information arising from the meeting with her attorney and any work product created with the assistance of or shared with the agent as a result of those meetings. Based on our caselaw and the record here, the answer in this case is no."; "Ms. Adams, an attorney who is now on inactive status with the North Carolina State Bar, is a friend of Defendant's and asserted in an affidavit that she had been 'acting as a consultant/agent on behalf of [Defendant] and the Tom Bush Law Group, and acting in a supporting role for [Plaintiff].' Ms. Adams stated that her friendship with Defendant began prior to the current proceedings."; "Attached to her affidavit was a copy of the 'Confidentiality Agreements and Acknowledgement of Receipt of Privileged Information' (the 'confidentiality agreement') that Ms. Adams entered into with Defendant, identifying Ms. Adams as Defendant's agent, emphasizing that the privileged information she received would be used 'solely for the purpose[] of settling or litigating' the divorce proceedings, and affirming the expectation that Ms. Adams's presence and involvement were 'necessary for the protection of [Defendant's] interest' and the expectation that all communications would be 'protected by the attorney-client privilege.'"; "The trial court failed to conduct the essential analysis as to whether the affidavit, confidentiality agreement, and other evidence established an agency relationship. We are aware of no caselaw, nor has Plaintiff cited any authority, that being a client's 'good friend' and being a client's agent are mutually exclusive. Nor does our caselaw prohibit a non-practicing attorney from acting as an agent for purposes of assisting another person in communications with legal counsel. Our holding would be the same if Ms. Adams had been a friend trained as an accountant, a psychologist, or an appraiser who agreed to assist with the litigation without charge. Consequently, we must reverse the trial court's order concluding that the attorney-client privilege does not apply in this case.")

Case Date Jurisdiction State Cite Checked
2016-04-19 Federal NC B 8/16

Chapter: 8.5

Case Name: In re Hugh Larkin, No. 01-15-00392-CV, 2016 Tex. App. LEXIS 2810 (Tex. App. March 17, 2016)
(finding that a landlord's grant of power of attorney to his daughter who was living in the father's condo meant that the daughter was inside privilege protection; "It is undisputed that Larkin owns the condominium that his daughter occupies. Larkin presented proof to the court that he had appointed his daughter as his attorney-in-fact to act on his behalf for 'in all capacity for all matters' for the condominium. Larkin further presented proof that his daughter, acting 'as attorney-in-fact for' Larkin, hired a law firm to handle the underlying dispute. She corresponded with the attorneys in the firm, and it is the correspondence between her and that firm that has become the subject of the discovery request at issue."; "Here, the power of attorney from Larkin to his daughter expressly gives his daughter the authority to act on his behalf 'in all capacity for all matters' for the condominium. We hold this necessarily includes the authority to retain legal counsel and to discuss legal matters with them. Larkin has not challenged his daughter's authority to retain counsel and communicate with them on his behalf. Instead, he has supported it."; "Larkin's daughter, then, fits within the definition of 'client's representative' in Rule 503. See TEX. R. EVID. 503(a)(2)(A) ('A 'client's representative' is . . . A person who has authority to obtain professional legal services for the client or to act for the client on the legal advice rendered.'). Because she is Larkin's representative, her communications with Larkin's attorneys are privileged.")

Case Date Jurisdiction State Cite Checked
2016-03-17 Federal TX

Chapter: 8.5

Case Name: In re Queen's University at Kingston, 2015-145, 2016 U.S. App. LEXIS 4259 (Fed. Cir. App. March 7, 2016)
(holding that the attorney-client privilege covered non-lawyer patent agents' communications relating to patent prosecution, but not related to infringement opinions or communications about the sale or purchase of a patent; "Notably, application of the rules of privilege to communications between non-attorney patent agents and their clients must be carefully construed."; "Communications between non-attorney patent agents and their clients that are in furtherance of the performance of these tasks, or 'which are reasonably necessary and incident to the preparation and prosecution of patent applications or other proceeding before the Office involving a patent application or patent in which the practitioner is authorized to participate' receive the benefit of the patent-agent privilege."; "Communications that are not reasonably necessary and incident to the prosecution of patents before the Patent Office fall outside the scope of the patent-agent privilege. For instance, communications with a patent agent who is offering an opinion on the validity of another party's patent in contemplation of litigation or for the sale or purchase of a patent, or on infringement, are not 'reasonably necessary and incident to the preparation and prosecution of patent applications or other proceeding before the Office.'")

Case Date Jurisdiction State Cite Checked
2016-03-07 Federal TX
Comment:

key case


Chapter: 8.5

Case Name: In re Queen's University at Kingston, 2015-145, 2016 U.S. App. LEXIS 4259 (Fed. Cir. App. March 7, 2016)