Intra-Corporate Sharing of Privileged Documents Beyond Those With a “Need To Know” Might Waive the Privilege

May 1, 2002

In what might be a counter-intuitive principle, courts routinely find that companies which share privileged information with company employees beyond those with a “need to know” waive the attorney-client privilege. One might think that companies would have an easy time establishing that they shared protected material only with those who needed to see it, but some courts reject this argument.

In Federal Trade Commission v. Glaxosmithkline, 203 F.R.D. 14 (D.D.C. 2001), the Court ordered Glaxosmithkline to produce arguably privileged documents, noting that its privilege log did not explain why certain listed employees received the materials. Glaxosmithkline had even filed an affidavit explaining that the employees receiving the pertinent document had a “need to know” of its content, but the Court rejected what it called the affidavit’s “conclusory allegations.”

The Glaxosmithkline decision may represent an extreme position on this issue, but companies should be prepared to litigate in jurisdictions taking such a harsh view of the privilege.