See the full circuit update, “CEO Failed to Prove Attorney-Client Privilege, Court Finds.”
The Upjohn warning is derived from the 1981 Supreme Court case Upjohn Co. v. United States, in which the high court decided that although communications between corporate counsel and employees may be privileged, that privilege is owned by the company, not the individuals.
Failing to provide employees with an Upjohn warning can lead to lawsuits. In 2009, Stanford Financial Group Chief Investment Officer Laura Pendergest-Holt, who faced criminal charges in connection with a multibillion-dollar Ponzi scheme, sued lawyer Thomas Sjoblom of Proskauer Rose for malpractice. According to Pendergest-Holt’s suit, when Sjoblom accompanied her to depositions at the Securities and Exchange Commission, he did not adequately represent her personal interests or provide her with an Upjohn warning that would have clarified his representation.
“Pendergest-Holt gave a deposition to the SEC with counsel and was subsequently charged with obstruction based on her statements in the deposition,” says Arnall Golden Gregory Partner Aaron Danzig. “Her argument was ‘I thought this attorney was representing me,’ and the attorney said, ‘No I am representing the company.’“