Court Addresses Work Product Waiver Issue Few Have Tackled: Part I

September 18, 2019

All or nearly all courts agree that disclosing work product to a non-adverse third party does not waive that robust protection – in contrast to the fragile attorney-client privilege. But what if that third party discloses the work product to the adversary? Should that disclosure: (1) be treated as an unauthorized disclosure, which does not waive the original protection (such as the improper disclosure of purloined privileged communications); or (2) reflect back on the original holder’s disclosure to the once-friendly third party (which might cause a waiver)? Remarkably few courts have dealt with this issue.

In City of Almaty v. Ablyazov, the court held that disclosing work product to a non-party witness waived the work product protection because the witness had “never agreed to maintain any information as confidential,” so the holder never had any assurance that the information it shared would not be disclosed to adversaries. No. 15-CV-05345 (AJN) (KHP), 2019 U.S. Dist. LEXIS 111607, at *25 (S.D.N.Y. July 3, 2019). The court quoted an earlier opinion focusing on the original disclosure: “[T]he question is not whether the non-adversary has actually revealed the materials to an adversary . . . , but whether, at the time of the disclosure, the disclosing party had reason to believe that further disclosure, to its party-opponent, would be ‘likely.'” Hedgeserv Ltd. v. SunGard Sys. Int’l Inc., No. 16-cv-5617 (LGS) (BCM), 2018 U.S. Dist. LEXIS 202535, at *6 (S.D.N.Y. Nov. 20, 2018). Id. at *25-26 (alterations in original) (citation omitted). Given the lack of any confidentiality agreement or assurance from the non-party witness, the City of Almaty court found a waiver.

The City of Almaty case did not deal with the more interesting question – whether the same result would have been appropriate if the non-party witness had agreed upon but later reneged on a confidentiality agreement. Next week’s Privilege Point addresses that issue.