attorney client privilege when a third party is involved

In a normal business setting, the attorney-client privilege is not implicated when third-party consultants are involved in typical business functions, such as meetings, revising draft documents, and setting corporate policy. However, the privilege can be, and often is, at issue when privileged communications are shared with these consultants.

Full Answer

Can a third party consultant claim the attorney-client privilege?

When determining whether the attorney-client privilege applies to a conversation involving a third person, courts generally consider: whether the defendant intended the communications to remain secret, and; the precise role of the third person. Courts use words like "essential," "necessary," and "highly useful" to describe roles that jibe with the attorney-client privilege.

What is attorney-client privilege and how does it work?

Jan 26, 2022 · In a normal business setting, the attorney-client privilege is not implicated when third-party consultants are involved in typical business functions, such as meetings, revising draft documents, and setting corporate policy. However, the privilege can be, and often is, at issue when privileged communications are shared with these consultants.

What is the attorney client privilege in Texas law?

As long as other factors necessary to the attorney-client privilege are present, either the “translator” theory or the “functional equivalent” theory will entitle a party to claim the attorney-client privilege for communications between (a) the party’s counsel and the third-party consultants, or (b) the client and the third-party consultant in the lawyer’s presence, or (c) the …

Does attorney-client privilege apply to communications between lawyers and Magee?

Mar 28, 2018 · Attorney-client privilege only applies to communications that are solely between a client and his or her attorney. If the client brings a random friend to a meeting, or discusses a conversation that took place with an attorney with a stranger, then the privilege is eliminated because the conversation has been disclosed to a third party.

Which of the following may not be protected under the attorney-client privilege?

Which of the following may not be protected under the attorney-client privilege? A client who orally confesses to a crime. Correct!

Do consultants break privilege?

Thus, where a consultant has a close working relationship with a company and performs a similar role to that of an employee, confidential communications that are made for the purpose of obtaining or providing legal advice should be subject to the attorney-client privilege.

Are communications between opposing counsel privileged?

The attorney-client privilege protects disclosure of a confidential communication between client and lawyer. (Evid. Code, § 954.)

Can represented parties talk to each other?

Parties to a matter may communicate directly with each other, and a lawyer is not prohibited from advising a client concerning a communication that the client is legally entitled to make.

What is third party privilege?

The general rule is that, by allowing a third party to be present for a lawyer-client conversation, the defendant waives the privilege. That generally means that the prosecution can force the third party to reveal the contents of the conversation.

Are communications with third parties privileged?

A communication between the lawyer or client and a third party can be privileged if it is confidential and made for the dominant purpose of enabling the client to obtain legal advice.Jul 1, 2021

What information is not privileged?

Non-Privileged Records . Means documents and records, whether hard copy or electronic, which are not subject to any legal privilege preventing its discovery and/or disclosure in a legal proceeding.

Are all communications between attorneys privileged?

As a general rule, any communications between a person and their attorney are presumed to be confidential—and thus covered by the lawyer-client privilege.

Are communications between two attorneys privileged?

Although historically courts held there was no privilege, more recently courts—including one California court—have concluded that communications between attorneys and their firm's in-house counsel are privileged.

When can a lawyer communicate about a legal matter with someone who already has a lawyer?

In representing a client, a lawyer shall not communicate about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized to do so by law or a court order.

When a lawyer acts on someone's behalf during proceedings?

Pro se legal representation (/ˌproʊ ˈsiː/ or /ˌproʊ ˈseɪ/) comes from Latin pro se, meaning "for oneself" or "on behalf of themselves", which in modern law means to argue on one's own behalf in a legal proceeding as a defendant or plaintiff in civil cases or a defendant in criminal cases.

Can a paralegal communicate with an opposing party?

Paralegals handle a large range of work delegated to them by an attorney. One of the most important duties of a paralegal is communicating with opposing counsel. In any given case, there can be hundreds to tens of thousands of pages of documents to review and exchange with opposing counsel.Sep 22, 2020

United States v. Kovel: Extending The Privilege to Nonlawyers

The seminal decision extending the attorney-client privilege to conversations with a nonlawyer was United States v. Kovel, 296 F.2d 918 (2d Cir. 19...

Calvin Klein: Thumbs Down on Public Relations Agents

Judge Friendly’s decision in Kovel said nothing about communications with public relations agents. The first case to address that issue was a trade...

Copper Market Antitrust Litigation: Thumbs Up on PR Agents

The following year, however, in In re Copper Market Antitrust Litigation, 200 F.R.D. 213 (S.D.N.Y. 2001) (Laura Taylor Swain, J.), the court recogn...

Twentieth Century Fox: Independent Hollywood Contractors Are Privileged

Twentieth Century Fox Film Corp. v. Marvel Enterprises, Inc., 2002 WL 31556383 (S.D.N.Y. Nov. 15, 2002) (Henry Pitman, Magistrate Judge) — a case I...

in Re Grand Jury Subpoenas: PR Agents Win Again

In In re Grand Jury Subpoenas Dated March 24, 2003 Directed to (A) Grand Jury Witness Firm and (B) Grand Jury Witness, 265 F. Supp.2d 321 (S.D.N.Y....

Currency Conversion Fee Antitrust Litigation: Transaction Processing Companies Don’T Qualify

In In re Currency Conversion Fee Antitrust Litigation, 2003 WL 22389169 (S.D.N.Y. 2003) (William Pauley, J.), a class action alleging a price-fixin...

Asia Pulp & Paper: Financial Consultant was Not A Privileged Person

Export-Import Bank of the U.S. v. Asia Pulp & Paper Co., Ltd., 232 F.R.D. 103 (S.D.N.Y. 2005) (James C. Francis IV, magistrate Judge), was a suit b...

in Re Adelphia Communications Corporation: Credit Consultants Pass Muster

In the bankruptcy proceeding entitled In re Adelphia Communications Corporation, 2007 WL 601452 (Bankr. S.D.N.Y. 2007) (Cecelia Morris, Bankr. J.),...

Sieger v. Zak: Business Consultants Qualify For The Privilege

Sieger v. Zak, 18 Misc.3d 1143(a) (Nassau County Supreme Ct. 2008) (Stephen Bucaria, J.) — one of two state court cases on the subject — was a suit...

Payton Lane Nursing Home: Construction Supervisors Make The Grade

In American Manufacturers Mutual Insurance Co. v. Payton Lane Nursing Home, Inc., 2008 WL 5231831 (E.D.N.Y 2008) (A. Kathleen Tomlinson, Magistrate...

Why do businesses use third party consultants?

Reed Smith – ByLisa Baird, Colleen Davies, Andrew Stillufsen – In our modern economy, businesses regularly use all manner of third-party consultants for many different reasons, including cost, efficiency, and expertise. Less regularly, communications between businesses and consultants are the subject of discovery motion practice in litigation. Two recent decisions out of the Southern District of New York demonstrate why businesses that use third-party consultants should proceed with caution to preserve claims of attorney-client privilege, and prevent the disclosure of what would otherwise be privileged communications.

How much did the Ashley Madison lawsuit cost?

Two Canadian law firms say they have filed a $578 million class-action lawsuit against the media companies behind Ashley Madison, following the massive hack that has exposed almost 40 million users on the adultery website.

Is attorney client privilege waived?

The root of the problem lies with a basic tenet of the attorney-client privilege: communications between attorney and client are confidential, but once that communication is shared with a third party, the privilege is waived. In some cases, however, courts have found an exception to this normal waiver rule, depending upon the role ...

What is the most recent case in the third party consultant line?

The most recent case in the third-party consultant line is a state court case, Mt. McKinley Insurance Co. v. Corning Inc., 602454/2002 (N.Y. County Supreme Ct., Dec. 13, 2009) (Eileen Bransten, J.). That case asked whether a lawyer’s talks with an insurance broker to get advice and information to help a client were protected by the attorney-client privilege.

What was the first case to address the issue of public relations?

The first case to address that issue was a trademark infringement action, Calvin Klein Trademark Trust v. Wachner, 198 F.R.D. 53 (S.D.N.Y. 2000) (Jed S. Rakoff, J.). In May 2000, in anticipation of filing a lawsuit on behalf of Calvin Klein, the law firm of Boies, Schiller & Flexner LLP (BSF) retained the public relations firm of Robinson Lerer & Montgomery (RLM) to act as a “consultant” to BSF for certain communications services related to BSF’s representation of Calvin Klein, Inc. (CKI). Defendants contended that BSF had retained RLM solely “to wage a press war against the defendant,” but plaintiffs said that they had retained RLM to help BSF “to understand the possible reaction of CKI’s constituencies to the matters that would arise in the litigation, to provide legal advice to CKI, and to assure that the media crisis that would ensue — including responses to requests by the media about the law suit and the overall dispute between the companies — would be handled responsibly…” The court denied Calvin KIein the protection of the attorney-client privilege, for at least three reasons.

What was the In re Currency Conversion Fee Antitrust Litigation?

2003) (William Pauley, J.), a class action alleging a price-fixing conspiracy by Visa and Mastercard and their member banks with respect to currency conversion fees, plaintiffs moved to compel a bank (First USA) to produce documents that First USA had disclosed to employees of a third party, First Data Resources, Inc. (First Data), which provided “computing services, consulting services, and other support services to credit card issuers.” First USA, citing In re Copper Market Antitrust Litigation and other cases, claimed that the First Data Documents remained privileged because the First Data employees were the “functional equivalent” of First USA employees.

What is the role of the media in public opinion?

The media, prosecutors, and law enforcement personnel in high profile cases often engage in activities that color public opinion, not only to the detriment of the subject’s general reputation but also, in extreme cases, to the detriment of his or her ability to obtain a fair trial.

What was the Sieger v. Zak case?

Sieger v. Zak, 18 Misc.3d 1143 (a) (Nassau County Supreme Ct. 2008) (Stephen Bucaria, J.) — one of two state court cases on the subject — was a suit alleging breach of fiduciary duty by the majority shareholder and principal manager of PowerSystems International, Inc., which manufactured specialized trailers sold primarily to the military to service command posts and mobile hospitals. Plaintiffs were minority shareholders who had each invested $25,000 in 1995 to get the company started. By early 2004, the company was making more than $1.2 million a year in profits, and plaintiffs suggested to Zak that he sell the entire company in order to liquidate their investment. Zak then met with a business consultant named John Magee who offered to make recommendations to PowerSystems’ board of directors concerning the current and future value of the company. Magee and PowerSystems entered into a confidentiality agreement whereby Magee agreed to keep confidential pricing, customer and supplier lists, operating data, and other information obtained in the course of providing consulting services to the company. Magee also prepared an “engagement letter,” which formally outlined the services he intended to perform for PowerSystems. In the engagement letter, Magee undertook to develop a strategy and time line for “monetizing the shareholders’ investment” in PowerSystems.

What was the Fox vs Marvel case?

Marvel Enterprises, Inc., 2002 WL 31556383 (S.D.N.Y. Nov. 15, 2002) (Henry Pitman, Magistrate Judge) — a case I unintentionally omitted from my 2003 article — originated as a copyright and licensing dispute over the “X-Men” characters. Fox withheld about 15 documents that Fox had shown to certain independent contractors. In opposition to a motion to compel, Fox argued that the independent contractors to whom disclosure was made were directly involved in the production of X-Men2 and that disclosure to them did not operate as a waiver of the privilege because “they functioned as employees and Fox’s economic decision to conduct its business through independent contractors as opposed to employees should not affect the scope of its privilege.”

What is attorney client privilege?

Attorney-client privilege is one of the most important protections afforded to litigants in a lawsuit. This privilege protects all communications that occur between an attorney and a client for purposes of seeking or receiving legal advice. This means that clients and their attorneys can talk without restraint, ...

When setting up a relationship with outside counsel, or considering how to navigate communications with general counsel within your company, should

When setting up a relationship with outside counsel, or considering how to navigate communications with general counsel within your company, you should consider consulting with a business litigation attorney. Thanks to the lack of certainty in this area of the law, standards and recommendations may shift, and new law is always being created.

Third Parties Can Be Forced to Reveal Contents of the Conversation

When you speak to your attorney, you are protected by attorney-client privilege that assures your attorney cannot be required to reveal confidential information. However, if you allow a third party to sit in on the meeting with your attorney, then that third-party can likely be compelled to disclose what they heard. However, there are exceptions.

The Main Exception

There is one main exception to this rule: If the person is there to aid the case.

It is Generally Best Not to Have a Relative or Friend Present

Many defendants assume that if they are talking with their attorney with a loved one, that their loved one would never be asked to talk about that meeting. It is true that the prosecution is likely to never find out, but if they do the results could be disastrous.

Your Criminal Defense Attorney Can Assure Privilege is Always Established

The good news is that if you work with an experienced criminal defense attorney, they will know when privilege does and does not apply. At Law Office of Michael L. Fell we would warn a client that having another person present may affect their attorney-client privilege.

What is the purpose of asserting and maintaining the privilege with third parties?

As with any assertion of privilege, it is important to understand that properly asserting and maintaining the privilege with third parties has two components: 1) ensuring that communications involving third parties and company attorneys (whether company counsel or outside counsel) are covered by the attorney-client and/or work-product privilege; and 2) maintaining that privilege by avoiding any claim of waiver.

What is the common interest privilege?

The common-interest privilege doctrine is another exception to the black-letter rule that the presence of a third party waives the attorney-client or work-product privilege. The common-interest privilege is typically invoked when privileged communications are exchanged among parties involved in such joint ventures.

What is black letter law?

Traditional black-letter law teaches that the presence of an outside, or third, party on an otherwise privileged communication will waive privilege. However, courts have found two exceptions to this rule: 1) where the third party is participating to assist an attorney in understanding and interpreting complex principles, ...

What is the Ambac decision?

The Ambac decision and the recent functional equivalent cases are the tip of the spear in the effort to assert and protect your company or client's privileged communications. As market pressures continue to force companies to find efficiencies through outsourcing typical in-house functions or engaging in joint ventures to promote or develop a product, counsel should be careful to properly structure the communication channels among vendors, third parties and joint venture partners so as not to waive any privilege. Taking a proactive approach to understanding the privilege rules of the relevant jurisdiction – which will most likely be the rules of the state in which the communications were made – before sharing privileged communications with a vendor or joint venture partner will save a great deal of stress in the future. Likewise, litigation counsel must be diligent in asserting these privileges during discovery, in order to educate opposing counsel and the courts on the recent shifts in the law.

Is privileged communications legal?

The modern business landscape is replete with examples of privileged legal communications occurring outside traditional corporate silos. For years, it has been appreciated by litigants (and courts) that bankers, experts and consultants could sufficiently implicate legal issues and strategies and, as a result, some communications with them may be protected under the attorney-client privilege. More recently, faced with pressure to increase efficiency, companies have increased their dependence on outside entities to complete tasks that were once reserved for in-house employees.

Why is it important to have an attorney-client privilege?

It encourages the client to be open and honest with his or her attorney without fear that others will be able to pry into those conversations. Further, being fully informed by the client enables the attorney to provide the best legal advice .

What is the privilege of an attorney?

The Privilege Only Protects Legal Advice. To invoke the attorney-client privilege, the proponent must establish a communication between attorney and client in which legal advice was sought or rendered, and which was intended to be and was in fact kept confidential.

Why do courts apply privileges?

Because the privilege is in derogation of the search for truth, courts will only apply it when the requirements are clearly met. The burden then falls on attorneys to stay up-to-date on the intricacies of the privilege and pass on their knowledge to clients who all too often make incorrect assumptions regarding the privilege’s scope.

What is privileged communication?

To be privileged, the communications must also reasonably be intended as confidential. This means that the communication must not be shared with any third party. However, with a corporate client, the attorney’s discussions with an employee may generally be shared with other non-attorney employees where information is sought at the attorney’s direction or the attorney’s legal advice is relayed. A party’s assertions that the communications were intended to be confidential will not satisfy the burden; the court will look to the circumstances to determine the intent.

Is a tax return privileged?

Thus, while documents related to tax returns are not privileged when the attorney provides accounting services in simply preparing the returns, those same documents may be privileged if an attorney uses them to provide legal advice as to whether the client should file an amended return.

What is the Ovivo vs Digital Mentor case?

v. Ovivo USA LLC, 3 a trademark case, held that disclosure of privileged communications to a general adviser waived the attorney-client privilege. Ovivo sought communications among Digital Mentor Inc., DMI’s counsel, and William Chastain, a third-party consultant.

Is a consultant engagement confidential?

Counsel should emphasize at the outset of each consultant engagement that all communications and documents generated in the engagement should be considered confidential and only shared with individuals within the company who have a need for the information — and never with a third party without approval of counsel.

Minnesota

For example, in one case in Minnesota, the Minnesota Supreme Court held that communications between a client, his lawyer, and his wife were not privileged. See State v. Rhodes, 627 N.W.2d 74 (Minn. 2001), aff’d, 657 N.W.2d 823 (Minn. 2003).

New York

Similarly, New York cases have held there is no privilege if a client and spouse speak with an attorney, explains to attorney Seth L. Laver:

Pennsylvania & Colorado

Federal courts in Pennsylvania and Colorado have come to the opposite conclusion, observed Laver: “the privileges can coexist.”

Public Policy Underpinnings

To my mind, the public policy reasons for privilege are reinforced when a spouse joins a client’s conversation with an attorney—not negated.

Best Practices

This probably goes without saying: until the law is settled, the safest option is to avoid confidential communications with an attorney and client’s spouse present.

Other Resources

For a list of related resources, check out Clients, Counsel, and Spouses: Case Studies at the Uncertain Junction of the Attorney-Client and Marital Privileges, an article by Jared S. Sunshine published in the Albany Law Review, Volume 81.2 (2018).