Corporate lawyers and their clients share sensitive correspondence on a regular basis. These exchanges contain assumptions on what is and what will remain a protected by attorney-client privilege. For in-house lawyers, interactions with colleagues (legal and business) across various lines of business may have significant consequences for invoking and retaining privileges. Connect to this the judicial prejudice toward privilege for in-house counsel and the rapid technical development and remote work environments prevalent in today’s corporate setting, and the privilege of the attorney-client becomes much more nuanced. This article will include best practices for corporate counsel to protect rights generally and when navigating cloud collaboration platforms and other forms of electronic corporate communications.
Attorney-client privilege is one of the most dynamic and complicated aspects of attorney’s practice. For corporate counsel, a corporate organization – with staff, business divisions and boards of directors – is increasing the complexity of this right. In addition, the dual position of in-house counsel as both a trusted legal counsel and a business consultant further complicates the matter. Since privilege determinations include a fact-sensitive review, this article aims to provide a general overview of privilege doctrines, particular issues faced by in-house counsel and, finally, some practical guidance on how to resolve privilege issues in online communication tools and platforms.
The client-law privilege covers interactions between clients and their lawyers and encourages them to interact freely and openly. Generally, for the right of a lawyer-client to be used for correspondence (either written or oral), communication (1) must be between a client and a lawyer or an agent of a lawyer; (2) must contain confidential information; (3) must be made without the involvement of a non-privileged third party; and (4) must be given for legal advice. The right belongs to the client, who can waive the privilege in the affirmative, unintentionally or by inference.
Express waiver happens when confidential information is revealed to a third party in a privileged correspondence. Inadvertent behavior by corporate counsel or the client may waive rights, such as sending an email to a party that does not need to know the protected information or limit access to the protected document. Implicit waivers arise when confidential information is called into question in the course of litigation, such as offering advice to counsel.
It is necessary to remember that the federal courts and each state have different rules on privilege. Corporate counsel for multi-state companies should be mindful of the privilege provisions of each jurisdiction in force.
The doctrine of the work product is a corollary to the right of the attorney-client. The doctrine forbids an adverse party from finding or compelling the disclosure of written or oral material prepared by or for a lawyer in the course of legal representation, in particular when it is prepared for the purpose of litigation. Work product is usually divided into two buckets: opinion work product and reality work product. Opinion job product involves a lawyer’s mental experiences, notes, and legal techniques. Fact Work Product contains material that is independent and separate from legal research, such as transcripts of witness interviews, reviews of non-testing experts, and client financial documents.
Not all correspondence between clients and lawyers are secured. Next, the basic facts of the matter will often be uncovered. For example, if a company initiates an internal investigation, the information discovered during the investigation are not privileged. However, the legal opinion of the counsel on the effects of the investigation and the proposed course of action is likely to be privileged.
Second, privilege protection does not apply to business advice given by a lawyer. Again, safe communications are those created to provide legal advice. Simply including a lawyer as a recipient of a correspondence or meeting invitation does not generally confer a protection on that communication or meeting. In addition, for those communications which combine business advice with legal advice, the privilege extends only to the portion containing legal advice.
Third, client messages that do not include a lawyer or a lawyer’s agent are not privileged. Privileged correspondence may lose its protected status if, at a later date, it is forwarded to parties who are not expected to participate in a conversation – suggesting that additional persons do not add the details or information necessary to provide legal advice or do not need legal advice to take action.
Finally, immunity should not extend to the facilitation or concealment of a crime or fraud.
For corporate counsel, a corporate organization is a client, not individual executives, directors, shareholders or employees of the company. Since a company behaves and deals with counsel only through certain entities, it may be difficult to decide when privilege applies.
Privilege is more likely to apply when an officer of a corporation or other senior management meets with a corporate lawyer, and is less likely to do so when contact is with a lower-level employee. Either way, the in-house counsel should make it clear that they represent the company and not any single entity.
Today, corporations depend more than ever on technology to function. Online collaboration tools are web-based applications that link individuals or groups via a restricted online portal. These tools provide a range of communication options, such as audio, video, and messaging, as well as document creation, editing, and storage.
While little case law explicitly addresses privileges and resources for online collaboration, current privilege rules apply. In order to decide whether the right of the attorney-client covers the contact, the courts apply the changed subject matter test. Under that approach, any corporate employee contact with the corporate counsel is shielded because it offers legal advice, the subject matter falls within the scope of the duties of the employee, the employee’s superior advised the employee to make the request, and only those individuals who need to know its contents receive the communication.
We therefore suggest that the following techniques be applied to maintain privilege by using online collaboration tools:
– Use different sharing areas, paper storage, messaging threads, and chat groups while obtaining or contributing legal advice versus business advice.
– Ensure that the only participants with access to privileged communication tool data are active contributors and others who share a privileged relationship (officers, directors or other ‘needs to know’ employees).
– Incorporate specific statements when obtaining or offering legal advice (such as “to seek legal advice” or “to provide legal advice”) and mark privileged materials such as “Attorney-Client Privileged” or “Attorney Work Product.”
– Confirm the data of the tool (shared documents, chats, instant messaging, teleconferencing and videoconferencing) is held in an encrypted state and disables automatic recordings or transcripts (or set policies controlling the creation of, access to, and use of these materials).
– Issue written policies and daily reminders that prohibit the use of screen capture equipment, cameras, and microphone-equipped electronic devices to record materials, messages, or meetings on the collaboration site.
Successfully navigating rights in this changing organizational environment requires careful preparation and monitoring. Luckily, however, the fundamental rules of attorney-client privilege and attorney-work product doctrine remain strong. Now is the time to ensure that these concepts are applied uniformly across all modes of communication with counsel, especially across online collaboration platforms.