It’s simple—the attorney-client privilege protects from discovery communications between a client and his or her lawyer. It’s challenging—the privilege applies to communications between (some) corporate representatives and outside counsel, depending whether federal or state privilege law applies; and if state law, which state. It’s convoluted—the privilege protects communications between (some) corporate representatives and in-house counsel, but only if U.S. law applies, the issue arises in an advantageous jurisdiction, and in-house counsel satisfy a heightened burden, prove the communication arose in a legal (rather than business) capacity, and the company employee did not waive the privilege by inappropriately disseminating the communication.
American law acknowledges the protections of an in-house attorney-client privilege, but “what is unclear is exactly how far this protection extends regarding the corporation’s employees and agents.” E.I. DuPont de Nemours & Co. v. Forma-Pack, Inc., 718 A.2d 1129, 1141 (Md. Ct. App. 1998). Courts recognize that “[d]efining the scope of the privilege for in-house counsel is complicated,” U.S. Postal Serv. v. Phelps Dodge Refining Corp., 852 F. Supp. 156, 160 (E.D.N.Y. 1994), and in-house lawyers and their in-house clients should too. The greatest source of difficulty concerns whether the employee communicated with the in- house lawyer so that he or she could render legal advice to the company. Courts effectively correlate in-house lawyers with Janus, the two-faced Roman God of Transition, with one face symbolizing counsel’s lawyer role and the other personifying his or her business role.
Originally Published in In-House Defense Quarterly, Winter 2014 Issue.
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Topics: Affiliates, Attorney-Client Privilege, Business Ownership, Consultants, Corporate Counsel, Discovery, Independent Contractors, Outside Counsel, Subsidiaries
Published In: Civil Procedure Updates, General Business Updates, Labor & Employment Updates
DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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