In this excerpt from our free eGuide on protecting attorney-client privilege, we explore the changes in rules regarding privilege and their real-life implications. Click here to download the full eGuide.
The right of an attorney to communicate with a client honestly and openly, without fear that their communications will be intercepted or reviewed by other parties, is a foundation of our justice system. As the U.S. Supreme Court put it, “The attorney-client privilege is the oldest of the privileges for confidential communications known to the common law.” (Upjohn Co. v. United States, 449 U.S. 383, 389, 1981) However, in our system of common law, that right has to be actively protected, or it is easily lost.
Defending Privilege
The rules of privilege are simple and straightforward – in theory. The ABA Model Rules of Professional Conduct Rule 1.6 on the Confidentiality of Information states:
“A lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized in order to carry out the representation, or the disclosure is permitted by [certain specific exceptions, e.g., to prevent death or substantial bodily harm].”
Simple, right? In other words, don’t give outside parties unauthorized access to your legal strategies or communications with a client.
In practice, however, protecting privilege can be one of the most complicated tasks in many types of litigation. In particular, the introduction of electronic evidence in the 1990s complicated a lawyer’s duty. Because it is possible to share digital files with a single mouse click, many lawyers, paralegals, and litigants have upended their cases with the accidental dissemination of privileged materials. The resulting chaos has led to multiple reevaluations and rule changes at state and federal levels.
Even with rule changes and clarifications, the law around privileged information is still in flux in many jurisdictions as courts struggle to define the responsibilities of all parties. In fact, there can be wildly divergent rules and standards from state to state regarding privilege. One reason for this is that the ABA Model Rules eased standards related to the receipt of privileged materials that were produced inadvertently, while some states have retained more stringent standards.
Model Rule 4.4 requires the lawyer to promptly notify the sender if they believe privileged information was inadvertently delivered. However, the rule does not specify if the receiving party should take additional steps, such as returning or destroying the document.
Meanwhile, some states have more stringent standards related to attorney-client privilege. For example, a number of states require that you stop reading the document, notify the sender, and abide by the sender’s wishes after they have been notified. Other states require something less than those three steps. And while some states do in fact follow the ABA Model Rule, still other states have no Rule 4.4 at all.
Given this inconsistency, legal teams should review ethics opinions and rules in a jurisdiction regarding the following questions:
To see how these questions play out in real-world cases, we will first review the existing federal rules. Second, we will study how mishandling privileged materials has been addressed in two recent cases, including one that attracted national headlines.
The Rules Have Changed
To address these challenges, updates to the Federal Rules Advising Committee related to privilege were adopted December 1, 2011. Specifically, Fed. R. Civ. P. 26 (b)(5) (and related provisions in Rules 16, 33, 34, and 37); and Rule 502 (b) of the Federal Rules of Evidence were amended.
The rules codified that an inadvertent disclosure of privileged material does not operate as a waiver so long as the privilege holder took, “reasonable steps to prevent disclosure” and “reasonable steps to rectify the error.”
The amended rule also codified that once the receiving party is aware of the production of privileged information, they “must promptly return, sequester, or destroy” the material and “must not use or disclose the information until the claim is resolved.”
Privilege Is A Duty
What this means is that both parties are under an ethical obligation when materials are inadvertently produced. Not only do attorneys have an obligation to protect their clients’ privileged data, but lawyers who receive such communications are potentially subject to professional discipline if they receive privileged materials.
For example, in Harleysville Ins. Co. v. Holding Funeral Home, Inc., 2017 BL 395 (W.D. Va. Feb. 2, 2017), the federal magistrate judge had to consider how to manage a matter in which privileged materials were accidentally produced to opposing counsel. In that matter, an employee for an insurance company accidentally produced the entire case file – with privileged material – on an unprotected file-sharing site, and then emailed a link to the site to an outside investigator. That same link was later inadvertently shared with opposing counsel in an email.
Attorneys for Harleysville, which had sent the privileged materials, filed a motion to disqualify Holding’s counsel, arguing that defense counsel had improperly used the hyperlink to gain unauthorized access to privileged materials.
Attorneys for Holding opposed the motion, countering that Harleysville’s placement of the materials on Box.com (a cloud storage provider), where it could be accessed by anyone, waived any claim of privilege or confidentiality. Although they conceded the files had been intentionally uploaded to Box, Harleysville argued that it had not waived privilege because it never authorized or intended disclosure of the files to anyone other than the investigator.
Boilerplate Is Not Enough
The Harleysville court noted that the only evidence the materials were not meant to be shared was a prominent confidentiality notice in the email that was used to initially forward the Box hyperlink. That, of course, is common for attorneys to include at the bottom of their emails. However, such notices are boilerplate, automatically appended at the very end of an email, following the confidential message they are meant to protect, and often ignored.
The ruling pointed out that the notice was useless in protecting sensitive information. The court found that, although Harleysville’s disclosure was inadvertent, in sharing the link to these documents, it had waived the attorney-client privilege. Specifically, under Rule 502(b), the magistrate judge determined there was “no evidence... that any precautions were taken to prevent this disclosure.”
By making the case file “accessible to anyone with access to the internet,” with no password protection, the insurance company failed the most basic tenet of reasonableness. “It is hard to imagine an act that would be more contrary to protecting the confidentiality of information than to post the information to the world wide web.” In other words, careless handling of privileged material can waive any attorney work product protections.
However, the magistrate judge also found that the actions of defense counsel were improper under federal and Virginia procedural rules. The judge imposed a sanction that defense counsel should bear the cost of both parties in obtaining the court’s ruling on the matter. In addition, privilege was waived for the materials in question.
A Real-Life Perry Mason Moment
In a more recent, high-profile defamation case, the attorney for conservative commentator Alex Jones admitted that his team had “messed up” when a paralegal shared a digital copy of Jones’s entire cell phone with every text message he had sent over the past two years.
In fact, Jones’ attorneys seem to have been unaware that the materials had been shared until opposing counsel shared attorney-client communications in court, with Mr. Jones on the stand.
“Mr. Jones, did you know that 12 days ago, your attorneys messed up and sent me an entire digital copy of your entire cell phone with every text message you’ve sent for the past two years? And when informed, did not take any steps to identify it as privileged or protect it in any way, and as of two days ago, it fell free and clear into my possession and that is how I know you lied to me when you said you didn’t have text messages about Sandy Hook. Did you know that?”
As a civil matter in Texas, Tex. R. Civ. P. Rule 193.3 applies. That rule states, “A party who produces material or information without intending to waive a claim of privilege does not waive that claim under these rules or the Rules of Evidence if – within ten days or a shorter time ordered by the court, after the producing party actually discovers that such production was made – the producing party amends the response, identifying the material or information produced and stating the privilege asserted.”
When informed of the snafu, plaintiffs’ attorney didn’t take any steps to identify as privileged any messages related to Jones’ defamation defense. That led to a dramatic courtroom confrontation, with Jones on the stand under cross-examination by plaintiffs’ lawyer Mark Bankston.
In an emergency motion hearing, Jones’ attorney Andino Reynal asked the judge for a protective order on all of those documents, including 2.3 gigabytes worth of materials that his legal assistant accidentally sent to opposing counsel. Judge Gamble denied the motion – and an accompanying motion for a mistrial, “without knowing what’s in it” and offered to give Reynal time to identify specific materials he wanted sealed.
Of course, at that point the damage was done. Thanks in part to the evidence found in the formerly privileged attorney-client communications, Jones was ordered to pay $45.2 million in damages.
No Clear-Cut Answer
The problem of inadvertent production is only going to become more severe in coming years as computer-aided review becomes more prevalent in the litigation process. That’s because, in order to lower the cost of review in the age of big data, lawyers are seeking out new tools that allow them to weed through enormous volumes of data without manually reviewing every document. That, of course, only makes it more likely that privileged documents will not be properly assessed.
While protecting privilege is challenging, the right strategies can make it easier. In our next excerpt from our eGuide on protecting privilege, we will provide practical tips to help your legal team ensure no privileged communications are overlooked and inadvertently disclosed.
