Court Demands Proof of Corporate Affiliation to Prove Privilege

August 13, 2003

Most courts find that lawyers representing one member of a corporate family may freely share privileged communications with other corporate family members without waiving the privilege. However, establishing the lack of waiver may require showing the nature of the corporate affiliation.

In Moore v. Medeva Pharmaceuticals Inc., No. 01-311-M, 2003 U.S. Dist. LEXIS 5960 (D.N.H. Apr. 9, 2003), a lawyer representing CPI argued that she had not waived CPI’s privilege by disclosing privileged communications to Evans, which she described as one of CPI’s “affiliates.” The court noted that the lawyer had not proven that one of the companies owned or controlled the other, or that another company owned controlling interest in both of them. Significantly, the court focused on the specific time that the lawyer disclosed the privileged communications to Evans, and said that the later merger of the two companies was “of little legal significance” in assessing waiver. Id. at *11 n.5. The court also noted that the lawyer had not established a sufficient “identity of legal interest” to apply the “common interest” doctrine. The court found that disclosing the privileged communications waived the privilege. Id. at *12.

Lawyers representing corporate affiliates must be prepared to establish the exact relationship if someone alleges that inter-corporate communications waived the attorney-client privilege.