Can A Trademark Case Defendant Avoid Privilege Waiver After Its Executive Testified That Its Lawyer “Cleared The Name For Us?”

October 2, 2019

Corporations can expressly waive their privilege when responsible loyal employees disclose privileged communications, and they can impliedly waive their privilege by relying on a lawyer’s advice to gain some advantage in litigation. When either one of those occurs, what can a corporation do to avoid the consequences?

In Airhawk International, LLC v. Ontel Products Corp., defendant’s Vice President of Product Strategy and Business Development testified at a trademark case deposition that “legal counsel ‘clear[ed] the name for us.'” Case No. 18-cv-0073-MMA-AGS, 2019 U.S. Dist. LEXIS 122675, at *2 (S.D. Cal. July 23, 2019) (alteration in original). The court found that the deposition testimony could result in an implied waiver and “may also support a claim for express waiver.” Id. at *7. But the court then assured defendant that it “may preserve the confidentiality of its communications by abandoning the basis for the implied waiver.” Id. at *9. If so, defendant would have to “file a stipulation that: (1) it will not use attorney-client communications in any way before the Court . . . and (2) it will ensure that its witnesses are instructed about this stipulation, to ensure that they do not inadvertently disclose such attorney-client communications.” Id.

Corporations should welcome the chance some courts give them to avoid the consequences of obvious express waivers or apparent implied waivers.