In a potentially game-changing decision for employers, the United States District Court for the Southern District of New York denied a former employee’s motion to compel the depositions of her former employer’s three-person Termination Review Committee. Two Committee members were non-attorneys, while its third member was one of its in-house attorneys. Her presence on the Committee, combined with the Committee’s determined role, was ultimately enough to persuade the Court that the Committee’s deliberations were attorney-client privileged. The employee sought the Committee’s testimony to bolster a slew of discrimination and retaliation claims she filed post-termination. The case is Fletcher v. ABM Building Value, 2017 WL 1536059 (SDNY Apr. 18, 2017).
Following her termination, Chris Fletcher sued her employer, ABM Building Value (“ABM”), and her supervisor, Katherine Collado, for race, color, ethnicity, sex, and gender discrimination. She also asserted harassment, hostile work environment, and retaliation claims under federal and state law. As part of the termination process, ABM uses a Termination Review Committee specifically to assess the risks inherent in firing the employee at issue. That committee conducted an assessment in Fletcher’s case. Fletcher, however, alleged that the Committee was actually involved in deciding whether or not to fire her, not just legal risk assessment.
Fletcher’s first attempt to compel the testimony of the Committee members was partially successful. Though ABM submitted an affidavit to the Court that explained its role as primarily legal, the Court found the affidavit insufficient on the issue of privilege. The Court’s decision focused on the two non-attorney Committee members, and the nature of the risks the Committee evaluated. It granted Fletcher leave to depose a Committee member for the limited purpose of determining whether attorney-client privilege applied. The Court further directed Fletcher to use the deposition to determine whether the Committee’s role was “limited to providing legal advice or whether it provid[ed] business advice in the ordinary course.”
Fletcher subsequently deposed Miranda Tolar, the in-house attorney who reviewed her termination. Thereafter, she moved to further depose the Committee members. She argued that ABM failed to meet their burden of establishing that the Committee’s deliberations were privileged. Alternatively, she argued they had waived privilege. She was unsuccessful on both counts. The Court found that the Committee’s purpose was to allow its lawyer to analyze termination decisions, and to communicate those risks to the ultimate decision-maker. To that end, the two non-lawyers on the Committee provided Tolar with necessary information for her legal analysis. Hence, their presence did not destroy the privilege. The Court further explained the legal standard for the corporate attorney-client privilege. The privilege covers communications of legal advice — not business advice — between employees and in-house counsel. The focus of the inquiry is on whether the predominate purpose of the communication is to “render or solicit legal advice.” The Court found Tolar’s deposition testimony persuasive. Tolar had testified that the two non-attorney Committee members provided her with information about Fletcher to enable her to assess the legal risks of termination.
Fletcher is not a guarantee that termination deliberations will be privileged where an employer’s attorneys are present. However, it signals to employers that particular deliberations related to assessing the legal risks involved in termination decisions may be privileged where an attorney is involved. The presence of non-attorneys is not necessarily a determining factor.
