Disclosing a privileged communication to a third party almost always waives that protection. But because the privilege necessarily rests on an expectation of confidentiality, the privilege can also essentially “evaporate” once the client intends to disclose the communication to a third party.
In Tect Aerospace Wellington, Inc. v. Thyssenkrupp Materials NA, Inc., Case No. 07-1306-JTM, 2009 U.S. Dist. LEXIS 40230 (D. Kan. May 12, 2009), a buyer sued a seller for breach of contract. Plaintiff buyer sought production of a demand letter that seller claimed to have previously sent to the buyer. Even though the seller had referred to the demand letter in correspondence and in its answer to buyer’s complaint, “[t]o everyone’s surprise, seller discovered that the June 22, 2007 [demand] letter had not been sent.” Id. at *4. Seller therefore resisted discovery, arguing that the letter “contains in-house counsel’s mental impressions, opinions and legal theories” and had not been disclosed outside the attorney-client relationship. Id. The court rejected the seller’s privilege claim, explaining that “[t]he flaw in seller’s privilege argument is that the demand letter was not intended to be a confidential communication between an attorney and a client.” Id. at *7. Instead, “seller intended that buyer read and respond to the June 22 demand letter.” Id.
Lawyers should remember that the attorney-client privilege can disappear the moment that the client abandons the intent to keep it confidential — even if the client never discloses the communication.