Originally published in NYSBA Inside | Spring/Summer 2012 | Vol. 30 | No. 1. SPECIAL ISSUE: WHAT’S NEW IN ETHICS AND PRIVILEGE.
The attorney-client privilege is a potent and practical rule of law based on the recognition that “sound legal advice or advocacy…depends upon the lawyer’s being fully informed by the client.” Upjohn Co. v. United States, 449 U.S. 383, 389 (1981). The privilege bars the compelled disclosure of communications between an attorney and client when the communication was made in confi dence for the purpose of seeking legal advice. Like all attorneys, in-house counsel must be cautious in protecting communications that fall under this rule; care should be taken to satisfy each requisite element and inadvertent disclosures should be avoided or quickly remedied. Yet, in-house counsel, whose clients are not individuals but corporations comprised of numerous employees, face unique challenges in doing so. It may be, in the words of Upjohn, that the privilege is meant to encourage “full and frank communication” between attorney and client, but to whom can in-house counsel freely speak when the client is a corporation? Are only executives’ communications with counsel protected, or does the privilege extend to communications with all employees? Is a conversation with a former employee privileged? Are foreign inhouse counsel treated the same as U.S. corporate counsel for privilege purposes? And, when in-house counsel also provides business advice, what information will be protected?
Elements of the Privilege Applied to In-House Counsel
Although the general rule of attorney-client privilege is easily stated, there are several wrinkles when the rule is applied to in-house counsel. For example, “client” and “confi dential” take on special meaning in the in-house context. The corporation is the client, yet in-house counsel must discuss legal strategy and otherwise interact with employees whom the counsel does not represent and whose interests may end up diverging from that of the client. Nonetheless, the privilege is protected when the corporation distributes legal advice received from counsel through corporate employees, and information gathered by employees for transmission to counsel for the rendering of legal advice is also usually privileged.
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