Drawing the Line Between Waiver and Non-Waiver: Part II

August 16, 2017

Last week’s Privilege Point described a New York court’s predictable waiver conclusion based on a client’s description of his intended future conduct — explicitly attributed to lawyers’ advice.  Siras Partners LLC v. Activity Kuafu Hudson Yards LLC, No. 650868/2015, 2017 NY Slip Op. 31216(U) (N.Y. Sup. Ct. June 5, 2017).  Another court dealt with a similar situation about two weeks later.

In Smith v. Ergo Solutions, LLC, Civ. A. No. 14-382 (JDB), 2017 U.S. Dist. LEXIS 94337 (D.D.C. June 20, 2017), Title VII plaintiffs sought to discover an outside lawyer’s report produced after that lawyer investigated an earlier sexual harassment claim against defendant’s managing partner.  The court found that the report deserved privilege protection, but that the managing partner waived that protection in deposition testimony describing the report’s recommendations and his compliance with them.  As the court put it, “[b]y discussing [the investigating lawyer’s] specific recommendations – that [the managing partner] stay away from [the company] for six months, pay a $10,000 fine, and see a therapist – [he] revealed [the lawyer’s] key conclusions and thus disclosed the ‘gist’ of the report.”  Id. at *11-12. Based on this waiver, the court ordered the report produced.

Most courts are more forgiving when considering the waiver implications of fast-paced deposition testimony.  But the managing partner defendant presumably could have avoided a waiver risk by declining to testify about the report’s recommendations – and instead simply describing what he did after the company received the report.  Corporations’ lawyers should educate their clients’ executives and employees about the dispositive distinction between (1) describing the companies’ or their own past actions or future intended actions (without attributing them to lawyers’ advice), and (2) disclosing privileged communications’ content.  The former does not waive anything, while the latter waives privilege protection and may trigger a subject matter waiver.  Next week’s Privilege Point discusses subject matter waiver issues.

Drawing the Line Between Waiver and Non-Waiver: Part I