Courts Explore the Upside and Downside of the Axiom That “Facts Are Not Privileged”

September 21, 2011

Except for a few unusual cases, every court recognizes that historical facts do not deserve attorney-client privilege protection. Something either happened or it didn’t. In some situations this basic principle helps companies, and in other cases it hurts.

In Gruss v. Zwirn, No. 09 Civ. 6441 (PGG) (MDH), 2011 U.S. Dist. LEXIS 79298 (S.D.N.Y. July 14, 2011), Magistrate Judge Dolinger held that a company did not waive its attorney-client privilege by disclosing to its shareholders facts uncovered in a corporate investigation. The court explained that “the attorney-client privilege applies to communications, not facts; even if certain facts were once the subject of a privileged attorney-client communication, disclosure of those facts does not waive the privilege in the communication.” Id. at *67. The same day, another court applied essentially the same principle in a different setting. In Gabarick v. Laurin Maritime (America), Inc., Civ. A. No. 08-4007 c/w 08-4012 SECTION: “B” (4), 2011 U.S. Dist. LEXIS 82583 (E.D. La. July 14, 2011), plaintiff claiming injuries from an oil spill sought to depose a former in-house lawyer for a company which had investigated the spill. The in-house lawyer’s former employer argued that “because she obtained her factual knowledge through confidential communication [the] knowledge of the facts is protected.” Id. at *42. The court bluntly stated “[t]his is not the law.” Id. The court then explained that “[t]he fact that [the in-house lawyer] obtained her knowledge of the underlying facts for purposes of serving in her capacity as corporate counsel is irrelevant. The Defendants are entitled to discover the facts.” Id. at *42-43.

All courts start with the basic proposition that historical facts do not generally deserve privilege protection. Sometimes this helps companies, but sometimes it does not.