Another Court Rules that Sharing Work Product with an Outside Auditor Does Not Waive the Work Product Protection

March 16, 2005

As indicated in earlier Privilege Points, two recent Southern District of New York decisions have taken the opposite positions on whether a company waives the work product protection by sharing work product with its outside auditor.

A California state court decision recently held that such sharing does not waive the work product protection. In Laguna Beach County Water District v. Superior Court, 22 Cal. Rptr. 3d 387 (Cal. Ct. App. 2004), the court noted California’s broad work product protection. Interestingly, the court did not cite either of the Southern District of New York decisions issued in the past few years, although it did point to a 1985 decision from the Southern District of Indiana.

Although the California court came to a conclusion that most companies welcome, it did not provide much intellectual support for its position.