Wednesday, February 25, 2015

The Attorney-Client Privilege - Some Important Considerations to Remember (Stephen Stapleton)

By Steve Stapleton

Two recent federal court cases, one from the Tenth Circuit Court of Appeals and the other from the Eastern District of Pennsylvania, offer some important reminders that we, as practitioners who may be in federal or state court, should keep in mind.
In the Tenth Circuit case involving a coverage dispute, Seneca Insurance Co brought suit against its insurance adjuster, Western Claims, and it's agent for implied equitable indemnity and negligence seeking to recoup the costs of defending and settling a lawsuit its insured had brought against Seneca.  Finding that because Seneca had cited "advice of counsel" to justify settling with its insured in the underlying action, the court concluded that Seneca had put the issue of the advice at issue and had therefore waived any attorney-client privilege or work-product protection.  Seneca Insurance Co. v. Western Claims, Inc., Nos, 13-6284 and 14-6002 (10th Cir., Dec. 22, 2014). Read the opinion here.
In the Pennsylvania case, an in-house executive brought a Title VII and Equal Pay Act case against her employer, Unitek Global Services, Inc..  Casey v. Unitek Global Services, Inc., Case No. 14-2671 (E.D. Pa., Feb. 9, 2015).  Read the opinion here.  The employee had a law degree and Unitek sought a protective order seeking to preclude the plaintiff's use of alleged attorney-client communication.  Finding correctly that the plaintiff was not counsel for the defendant company, the court denied the motion.

However, the company also requested that the court seal certain allegedly privileged documents.  Finding that some of the documents would support their characterization as privileged, the court nonetheless denied the motion to seal finding that "documents to which a party claims protection from discovery based on the attorney-client privilege, cannot thereafter be used in the furtherance of that party's defense without that party waiving the privilege."
In each of these cases, the court denied the protection sought on the basis of attorney-client privilege.  In both of these cases, the courts concluded, the protection sought included attorney-client communication that could justify protection.  However, the parties in each case forgot the fundamental rule of the attorney-client privilege:  it is a narrow principle, designed to protect the public,  that does not, and should not, protect all attorney-client communication.  
Therefore, when you use the privilege as a sword, you cannot thereafter hide behind its protection.  When advice of counsel is put at issue, the advice which would otherwise be protected, is fair game.

Remember this.  It's important.

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