As challenging as it is to determine which privilege law a court will follow, it can be even more difficult to determine what privilege law an arbitrator will use.
In Howard University v. Metropolitan Campus Police Officer’s Union, 512 F.3d 716 (D.C. Cir. 2008), the university appealed a district court’s decision upholding an arbitration award in favor of a campus police union. Among other things, the university argued that the arbitrator had improperly excluded Howard’s proffer of testimony by the union’s chief negotiator — apparently believing that the testimony violated the union’s attorney-client privilege. The federal appeals court agreed with Howard that “testimony by an attorney describing statements made in open negotiations would not be subject to the attorney-client privilege in a federal court.” Id. at 722. However, the court rejected the university’s appeal. It noted that “the arbitrator was not bound by the particulars of federal law governing the attorney-client privilege,” so that “the question is not whether the arbitrator correctly applied federal law; the question is whether her decision to exclude the evidence out of a concern for a client’s asserted interest in confidentiality amounted to ‘misconduct.'” Id.
Companies considering arbitrations should bear in mind that they may have no recourse if the arbitrator ignores general attorney-client privilege principles.