Four Practical Tips for Protecting the Attorney-Client Privilege, Straightline

The critical protection offered by the attorney-client privilege—maintenance of the confidentiality of communications between an attorney and client—is increasingly under attack from both government regulators and private litigants. Moreover, there are some situations in which it is not at all obvious that the protections afforded by the attorney-client privilege are put at risk. For example, in stark contrast to US attorney-client privilege protections, the privilege is not even recognized in some situations outside the US, such as conversations between business people and in-house counsel. Here are some practical tips for ensuring that your communications with counsel are protected by the attorney-client privilege and not subject to disclosure.

1. CLEARLY IDENTIFY PRIVILEGED COMMUNICATIONS

Communications that are clearly attorney-client privileged, i.e., they are made for the purpose of seeking or providing legal advice, should be identified as such. Use of phrases within the body of privileged communications, such as “I am seeking legal advice related to...” or “In response to your request for legal counsel regarding...” further confirm that the communication is privileged. Use of the “privilege” label does not create a privilege that might not otherwise exist. Therefore, do not overuse the “privilege” label; doing so may make it more difficult to establish the protection of the privilege for communications that were truly made to obtain or provide legal advice.

2. PRIVILEGE RULES OUTSIDE THE US ARE DIFFERENT

Although most countries recognize some form of attorney-client privilege, the scope and application of the privilege may vary significantly by country. For example, while communications between in-house counsel in the US and their internal business clients in the US are protected by the same privileges that apply to outside US counsel, there is no in-house counsel privilege in the majority of countries in the European Union (EU). Those countries reason that inside counsel are not independent of their employers and therefore are not entitled to the same privilege protections afforded communications with outside counsel who are deemed to be independent. EU law is also unlikely to recognize as privileged a communication between in-house counsel based in the US and a business client based in the EU. Indeed, in one case, the EU seized legal memoranda from inside counsel and relied on them to determine that a company knowingly violated the law. Case law further suggests that the EU may not even recognize as privileged a communication between outside US counsel and a business client located in the EU. The implications of the starkly different treatment of the attorney-client privilege as between the US and the EU can be serious. For example, parties to litigation in the US may attempt to seek discovery of sensitive communications between in-house counsel in the EU and internal business clients based in the EU. To maintain the protection of the attorney-client privilege outside the US to the greatest extent possible, the following steps should be taken:

1. analyze the attorney-client privilege rules in each jurisdiction in which your company has operations,
2. based on that analysis, determine whether it is necessary to engage local outside counsel to maximize the protection of the attorney-client privilege,
3. limit the privileged information sent by US inside counsel to European offices, and
4. limit access to US legal department files and servers by non-US offices.

3. USE CAUTION WHEN COMMUNICATING WITH OUTSIDE DIRECTORS

Most outside directors have other business interests, and many are employed by other companies. If these outside directors use email addresses provided by their employer or other business interests, they may subject emails relating to the company on whose board they serve, including attorney-client communications, to discovery because they have a very limited, if any, expectation of privacy related to an email address that is controlled by their employer or unrelated business interest. To protect email communications with outside directors to the greatest extent possible, the outside directors should use either an email address provided by the company on whose board they serve or a personal email address. If that is not possible, any board-related emails going to or from another company’s email address should be clearly identified in the subject line as board-related business and, if to or from an attorney, that the communication is privileged, and the outside director should segregate those emails in a separate folder.

4. IN-HOUSE COUNSEL SHOULD CAREFULLY CONSIDER THE RISKS OF SIGNING AFFIDAVITS OR SWORN STATEMENTS

Signing affidavits or other sworn statements on behalf of the company, such as verifications of discovery responses in litigation, may subject the signer to a deposition or other discovery of the factual basis on which the statement or affidavit was made. If the affidavit or sworn statement is signed by in-house counsel, protecting information obtained by in-house counsel in the course of investigating the matter that led to the affidavit or statement becomes very difficult because the act of signing may be viewed as a waiver of the attorney-client privilege. Therefore, to the extent possible, use non-attorney business people to sign affidavits or other sworn statements on behalf of the company.

In sum, recognition of those situations in which the protection of the attorney-client privilege may be at risk and adherence to best practices are necessary to continue maintaining the confidentiality of attorney-client communications.