Courts Continue to Debate Waiver Effect of Sharing Protected Documents with the Government

October 26, 2005

Courts continue to debate the waiver effect of sharing protected documents with the government. The trend has generally been in favor of a waiver finding, but not without exception.

In In re CMS Energy Sec. Litig., Nos. 02-CV-72004 & 02-CV-72834, 2005 U.S. Dist. LEXIS 8838 (E.D. Mich. May 13, 2005), the court found that a company’s sharing of an internal investigation report with various government agencies under a confidentiality agreement waived the attorney-client privilege and the work product doctrine protection. Five weeks later, the court in In re Natural Gas Commodity Litig., No. 03 Civ. 6186 (VM)(AJP), 2005 U.S. Dist. LEXIS 11950 (S.D.N.Y. June 21, 2005), took exactly the opposite approach – finding that companies did not waive the work product protection by sharing with various federal agencies an internal investigation report prepared by the Orrick Herrington law firm. The court noted that the companies had “explicit written confidentiality and non-waiver agreements with the government agencies,” and also that the companies “have produced to plaintiffs in this litigation the factual documents underlying the work product analyses provided to the government agencies.” Id. at *36, 37.

Although the national trend continues in the direction of finding a waiver in such circumstances, the Second Circuit’s recognition that the work product protection might survive such sharing should give some hope to companies conducting internal investigations.