THE ATTORNEY-CLIENT PRIVILEGE

Transcription

1 ATTORNEY-CLIENT PRIVILEGE AND WORK PRODUCT DOCTRINE: ISSUES FOR ENVIRONMENTAL CONSULTANTS, COUNSEL, AND CLIENTS Presented by Daid B. Weinstein, Esq. I. THE ATTORNEY-CLIENT PRIVILEGE A. What is it? 1) A communication; 2) made between a lawyer and client; 3) in confidence; 4) for the purpose of seeking, obtaining or proiding legal assistance to the client. 1

2 I. THE ATTORNEY-CLIENT PRIVILEGE B. Definitions A Lawyer is a person authorized, or reasonably belieed by the client to be authorized, to practice law in any state or nation. A Client is any person, public officer, organization, association, or other organization or entity, either public or priate, who consults a lawyer for the purpose of obtaining legal serices, or who is rendered legal serices by a lawyer. II. THE WORK PRODUCT DOCTRINE A. What is it? The work product doctrine applies to documents and other tangible things, such as reports or electronic data, prepared by a party or its representatie (including the party s attorney, consultant, surety, indemnitor, insurer, or agent), in anticipation of litigation (regardless of whether they pertain to confidential communications with a client). 2

3 II. THE WORK PRODUCT DOCTRINE B. Types of Work Product There are two types of work product: Fact work product, which refers to facts, documents, statements, or other information gathered in preparation for or in anticipation of litigation; and Opinion work product, which refers to an attorney s or other client representatie s mental impressions, conclusions, opinions, or theories concerning the litigation. II. THE WORK PRODUCT DOCTRINE C. Protections Fact work product is a limited priilege, and may be subject to production if the opposing party can demonstrate: 1) a substantial need for the materials in preparation of the opposing party s case; and 2) that, without undue hardship, the opposing party is unable to obtain the substantial equialent of the materials by other means. Opinion work product is almost always protected from disclosure. 3

4 II. THE WORK PRODUCT DOCTRINE D. Application Courts hae held that the work product doctrine potentially applies to witness statements, notes made by a client at the attorney s direction, research reports assembled to assist in the defense of a case, insurance claim files, and inestigatie photographs. II. THE WORK PRODUCT DOCTRINE E. Limitations The work product doctrine usually protects only the documents themseles from being disclosed and not the underlying factual information. If an attorney intends to introduce the information at trial, courts will not consider such material protected by the work product doctrine. 4

5 II. THE WORK PRODUCT DOCTRINE F. Consultants The work product of consultants is protected if the party acted under a belief that litigation may ensue and that belief was tempered by objectie reasonableness. Howeer, problems may arise when a consultant is hired to perform work for a client prior to anticipation of litigation and is latter hired to perform work in anticipation of litigation. II. THE WORK PRODUCT DOCTRINE F. Consultants To maximize the effectie application of the work product doctrine, a client should aoid hiring consultants who hae performed work for the client that was not in anticipation of litigation. If the same consultant is also going to be utilized after litigation is anticipated, then prudent protocols must be carefully followed. 5

6 III. THE SELF CRITICAL ANALYSIS PRIVILEGE A. What is it? Some courts hae recognized a priilege for internal reports that ealuate a company s historical compliance with enironmental laws and regulations, while others hae rejected it. To encourage monitoring and compliance with the law, some states hae enacted legislation establishing priileges and/or immunities relating to internal enironmental reports. III. THE SELF CRITICAL ANALYSIS PRIVILEGE B. Coerage Typically, the priilege extends only to subjectie opinions, impressions and conclusions contained in a written report, and not to the objectie facts that may hae been compiled as part of the report. The purpose of the report is critical in determining applicability of the priilege. The report will not be priileged if it is prepared for the purpose of obtaining technical enironmental data rather than for the purpose of seeking legal adice. 6

7 III. THE SELF CRITICAL ANALYSIS PRIVILEGE C. EPA Policies The EPA is opposed to state legislation granting priileges and immunities to companies with respect to enironmental audits. Howeer, the EPA has adopted policies that are intended to act as compliance incenties to encourage self-auditing and oluntary reporting. These policies set forth eligibility criteria for mitigation of penalties, but are not binding on the EPA and do not proide guarantees of priileges or immunities. III. THE SELF CRITICAL ANALYSIS PRIVILEGE C. EPA Policies: Eligibility Criteria for Mitigation Systematic Discoery; Voluntary Discoery; Prompt Disclosure; Independent Discoery and Disclosure; Correction and Remediation; Preention of Recurrence; Repeat Violations Ineligible; Serious Actual Harm/Endangerment/Violations of Orders and Agreements Ineligible; and Cooperation. 7

8 III. THE SELF CRITICAL ANALYSIS PRIVILEGE C. EPA Policies: Cooperation In April 2000, EPA finalized its reised policy which proides that cooperation in a criminal inestigation includes proiding, at a minimum, the following: access to all requested documents; access to all employees of the disclosing entity; assistance in inestigating the iolation, any noncompliance problems related to the disclosure, and any enironmental consequences related to the iolations; III. THE SELF CRITICAL ANALYSIS PRIVILEGE C. EPA Policies: Cooperation access to all information releant to the iolations disclosed, including that portion of the enironmental audit report or documentation from the compliance management system that reealed the iolation; and access to the indiiduals who conducted the audit or reiew. 8

9 A. Priilege Log When an opposing party seeks production of documents, a client may withhold documents that are protected by the attorney-client priilege or work product doctrine. The priileged nature of the documents may be challenged, howeer, requiring the production of a Priilege Log, which is essentially an inentory of the materials that a party is withholding. A. Priilege Log Federal Rule of Ciil Procedure 26 addresses the production of a priilege log. Howeer, it does not proide specific details of the required contents of a Priilege Log. Rather, it simply requires documents or communications to be described sufficiently enough to allow other parties to assess the applicability of the claimed priilege. 9

10 A. Priilege Log Various districts hae created local rules requiring the inclusion of such items as: The type of document; General subject matter; Date; Author; Addressee; and Other information sufficient to identify the document. A. Priilege Log A blanket claim of priilege in a Priilege Log without further supporting information is typically insufficient to receie protection. Failure to adequately substantiate the priileged nature of documents in a Priilege Log can result in a court ordering production of such documents. 10

11 B. Internal Document Controls Organizations should establish protocols for handling documents that are een arguably priileged, including: Establishing a control group of employees who are responsible for making decisions based upon the legal adice proided; Marking all documents Priileged and Confidential Not for Circulation ; B. Internal Document Controls Limiting the dissemination of potentially priileged materials to the control group; and Segregating all potentially priileged material from general business documents for storage purposes, including, without limitation, maintaining potentially priileged material in separate folders and locations from general business documents, and limiting access to areas where potentially priileged materials are stored. 11

12 B. Internal Document Controls Adhering to these protocols will assist in preenting the inadertent waier of a priileged that may hae attached to the documents. C. Protocols For Dealing With Company Employees During the course of rendering legal adice to an organization, it is often necessary for corporate counsel to interiew employees. The general rule established by the United States Supreme Court makes it clear that corporate counsel s discussions with employees are priileged when the discussions relate to legal adice being proided to the organization. In these circumstances, the organization, not its indiidual employees, is the client and holder of the attorney-client priilege. 12

13 C. Protocols For Dealing With Company Employees Howeer, the fact that corporate counsel is inoled in a matter does not automatically confer a priilege, particularly if that attorney is acting in a business rather than legal capacity. Therefore, a blanket protection for discussions between corporate counsel and all employees does not exist. Whether the attorney-client priilege applies is to be decided on the particular facts of each case. C. Protocols For Dealing With Company Employees In limited circumstances, an attorney-client priilege can be created between corporate counsel and the employee. The corporate employee may make disclosures to inhouse counsel that potentially relate to liability in an indiidual capacity. While the organization may later decide that it wishes to disclose this information to the goernment in an effort to cooperate, the employee may be able to assert the attorney-client priilege indiidually. 13

14 C. Protocols For Dealing With Company Employees In order to successfully assert the attorney-client priilege indiidually, employees must establish that: They approached counsel for the purpose of seeking legal adice; When they approached counsel, they made it clear that they were seeking legal adice in their indiidual rather than their representatie capacity; C. Protocols For Dealing With Company Employees Employees must establish (cont d) that: Counsel saw fit to communicate with them in their indiidual capacity, knowing that a possible conflict could arise; The conersation with counsel was confidential; and The substance of their conersations with counsel did not concern matters within the general affairs of the company. 14

15 C. Protocols For Dealing With Company Employees Because these factors will not ensure the applicability of a priilege, the organization should establish protocols that will be taken if an officer, director or employee approaches counsel with an issue that implicates both the organization and the indiidual, including: Operating in such a manner that corporate counsel does not gie the impression that he represents the employee in an indiidual capacity; C. Protocols For Dealing With Company Employees Proiding an attorney when an employee expresses a desire for indiidual representation; Securing outside counsel to represent the employee at an early stage; and Entering into a Joint Defense Agreement (discussed below) after the employee has secured legal representation. 15

16 C. Protocols For Dealing With Company Employees Proiding outside counsel for officers and employees can result in strategic adantages beyond establishing the protection of the attorney-client priilege. These adantages include: Aoiding an appearance of a conflict of interest for corporate counsel, thus aoiding possible disqualification of the attorney during litigation; Proiding a leel of comfort for the employee by showing the company stands behind him or her; C. Protocols For Dealing With Company Employees Adantages (cont d): Aoiding the appearance that the organization is influencing the testimony of the employee; and Proiding a buffer between the employee and the goernment. 16

17 C. Protocols For Dealing With Company Employees The obious drawback in proiding counsel for officers and employees is the possibility that their attorney will determine that it is in the indiidual client s best interest to cooperate with the goernment against the organization. This is particularly true when dealing with enironmental crimes that could result in incarceration for the indiidual. This possibility is unaoidable, but it is probably a better risk than attempting dual representation of the organization and the employee, particularly in the criminal context. D. Joint Defense Agreements Joint Defense Agreements are often an indispensable tool in preparing for ciil or criminal litigation inoling enironmental issues. These agreements allow for the exchange of information and ideas among numerous co-defendants without waiing the attorneyclient priilege or work product doctrine. 17

18 D. Joint Defense Agreements Factors to consider in a Joint Defense Agreement are as follows: Include in the agreement a proision that a party to the agreement will not seek to disqualify the attorney of any other party based upon information disclosed in the agreement; D. Joint Defense Agreements Factors (cont d): Make sure that the agreement states that you will not be restrained in representing your client s interests by irtue of information reealed by another party. (An example would be your ability to cross-examine a co-defendant as to subject areas where confidential facts were reealed as part of the Joint Defense Agreement); 18

19 D. Joint Defense Agreements Factors (cont d): Reiew and discuss the agreement thoroughly with the client. Consider carefully what benefits are expected to be gained from the agreement; Mark all documents exchanged as Confidential and make reference to the agreement; Do not enter into an agreement with a party whose interests are completely aderse to the client s; D. Joint Defense Agreements Factors (cont d) : Proide for continued confidentiality once someone withdraws from the agreement; Make sure that the agreement clearly binds the parties from disclosing information after termination of the agreement; and Require the return of all Joint Defense Documents from any party terminating the agreement. 19

20 D. Joint Defense Agreements The attorney-client protection afforded to communications made in the context of a Joint Defense Agreement can be waied if the communications are made to, or in the presence of, third parties. An attorney should adise his client that third parties should not attend joint defense meetings. No matter how careful one is, remember that the other participants and their attorneys may not be as careful. D. Joint Defense Agreements These agreements are not without risk. If the agreement is not properly structured, the goernment or other aderse party may seek to hae it disregarded. Furthermore, the fact that co-defendants often do not share exactly the same interests in a case can create a conflict of interest. The confidential information of one party may proide another party a strategic adantage in the litigation. Notwithstanding the risks, the Joint Defense Agreement is often the recommended course of action. 20

21 E. Protocols for Consultants and Internal Audits Organizations should consult extensiely with counsel experienced in enironmental law before relying on the protections of the attorney-client priilege or work product doctrine with respect to the retention of consultants in anticipation of litigation or for the performance of internal enironmental audits. E. Protocols for Consultants and Internal Audits If an organization desires to undertake an analysis of its potential enironmental liability, the analysis can be conducted in such a way as to maximize the protection afforded by the attorney-client priilege and work product doctrine. 21

22 E. Protocols for Consultants and Internal Audits The following actions can assist an organization in securing the protection afforded by legal priileges and, to the extent possible, should be incorporated into the consulting agreement: Hae counsel retain the consultant rather than the client/organization (preferably a consultant who does not hae a prior work history with the client); E. Protocols for Consultants and Internal Audits Actions cont d: Prepare a consulting agreement that references actual or anticipated litigation and identifies potential aderse parties; State what the consultant is being hired for in the consulting agreement and that such work is to be performed solely at the direction of counsel (i.e., assisting the attorney in the assessment of case facts for the purpose of proiding legal adice in anticipation of litigation); 22

23 E. Protocols for Consultants and Internal Audits Actions cont d: State that the work product generated by the consultant belongs to counsel and should be submitted to counsel rather than directly to the client; Proide that all fees billed by the consultant should be submitted to and paid for by counsel, who may then recoer the consultant s fees from the client as an attended cost of the anticipated litigation. E. Protocols for Consultants and Internal Audits Actions cont d: Set forth the consultant s obligation of confidentiality with respect to the work performed; The consultant should maintain all work performed under the consulting agreement in files marked Priileged and Confidential Not for Circulation; and All communications to and from the consultant should be labeled as Priileged and Confidential - Prepared in Anticipation of Litigation, and Attorney-Work Product. 23

24 E. Protocols for Consultants and Internal Audits Actions cont d: Discuss priilege implications before a document or report is generated by the consultant; Limit or eliminate communications between the consultant and low-leel, non-attorney employees. For example, limit the consultant to gathering information only and remind employees that the consultant is retained only to proide assistance to counsel in rendering legal adice; E. Protocols for Consultants and Internal Audits Instruct the consultant to immediately notify counsel if: Documents or records are disclosed without the authorization of counsel; There is a request from a third party to inspect or examine the documents; and The consultant is sered with a subpoena. 24

25 E. Protocols for Consultants and Internal Audits There is no realistic way to achiee absolute protection for the results of an internal analysis. Howeer, careful planning and consultation before commencing such an endeaor can proide meaningful protection to the organization. V. ADDITIONAL CONSIDERATIONS Insurance Carriers Where an organization seeks to hae their insurance carrier pay for enironmental damages, the insurance company may seek a waier of the organization s attorney-client priilege relating to such a claim. The carrier may argue that a policy s cooperation clause requires such disclosure, and some courts hae ruled that an indemnification action waies such a priilege. 25

26 V. ADDITIONAL CONSIDERATIONS Insurance Carriers In light of this, an organization should: ß Reiew their policies now to determine what language is in the policy regarding waier and cooperation; and ß Consult with experienced counsel to reiew the applicable case law with respect to any possible waier. ATTORNEY-CLIENT PRIVILEGE AND WORK PRODUCT DOCTRINE: ISSUES FOR ENVIRONMENTAL CONSULTANTS, COUNSEL AND CLIENTS Presented by Daid B. Weinstein, Esq. 26