Courts Explore Contours of the “Crime-Fraud” Exception

July 13, 2005

The crime-fraud exception to the attorney-client privilege strips the protection from communications between a client and a lawyer about the former’s future criminal activity (most courts also apply the exception to fraud). Courts debate the required connection between the communication and the wrongdoing.

In United States v. Paz, 124 Fed. Appx. 743, 746 (3d Cir. 2005), the Third Circuit explained that the otherwise privileged communications must be “related” to the criminal activity. A week earlier, the court in Tri-State Hospital Supply Corp. v. United States, 226 F.R.D. 118, 133 (D.D.C. 2005), took the more prevalent approach, which requires that the client “made or received the otherwise privileged communication with the intent to further an unlawful or fraudulent act” (emphasis added; internal citation omitted). The “relationship” standard obviously requires less proof than the “to further” standard.

It would not be surprising to see the United States Supreme Court eventually settle this debate.