Thank you for sharing!

Your article was successfully shared with the contacts you provided.
A defendant in a breach of contract lawsuit must return documents inadvertently disclosed by the plaintiffs during discovery, Judge John W. Herron of the Philadelphia County Court of Common Pleas has ruled. In Herman Goldner Co. Inc. v. Cimco Lewis Industries, Goldner’s counsel inadvertently provided privileged and confidential documents to two defendants in the breach of contract case, Klenzoid Inc. and Cimco. Goldner requested that the defendants return the documents, and, while Klenzoid complied, Cimco refused, arguing that Goldner’s production of the documents amounted to a waiver of privilege. Goldner then filed a motion to compel the return of the documents. In an opinion coming out of the Commerce Program of the Philadelphia Court of Common Pleas, Herron said that the motion raised two issues: whether Cimco had an obligation to return the documents and whether Cimco was allowed to use information in the documents in depositions. Herron agreed with Goldner on both counts, and first addressed the issue of whether Cimco had an obligation to return the physical documents to Goldner. “In this regard, the law is clear,” Herron wrote. “An attorney receiving confidential documents has ethical obligations that may surpass the limitations implicated by the attorney-client privilege and that apply regardless of whether the documents in question retain their privileged status.” In his decision, Herron cited the American Bar Association standing committee on ethics and professional responsibility’s opinion on the return of inadvertently disclosed documents. In part, the ABA opinion reads: “It is the view of the committee that the receiving lawyer, as a matter of ethical conduct contemplated by the precepts underlying the model rules (a) should not examine the materials once the inadvertence is discovered, (b) should notify the sending lawyer of their receipt, and (c) should abide by the sending lawyer’s instructions as to their disposition.” Herron also surveyed state bar associations’ opinions on the matter and found them to be aligned with the ABA. Accordingly, he concluded, Cimco must return the documents. His decision, he said, was also justified under the particular facts of the case. Herron observed that Goldner argued that it turned over the documents in question to Cimco quickly because it was striving to satisfy Cimco’s desire to have the documents available before a specific deposition. Goldner also acted quickly to recover the documents once it became aware that the confidential documents were disclosed, Herron said. “Within two weeks of making the disclosures and within one day of becoming aware of them, Goldner’s counsel contacted Cimco’s attorneys and requested the return of the documents,” he wrote. “It appears that the disclosure of the documents was unintentional. Consequently, the court concludes that Cimco is obligated to return all privileged documents and that the motion must be granted in this regard.” Herron then turned to the issue of whether Cimco could use information contained in the documents in question. Herron determined that, in similar cases, courts have considered four factors: � the reasonableness of the precautions taken to prevent disclosure; � the inadvertence, extent and number of the disclosures; � the steps taken after learning of the disclosure, and the time frame in which those steps were taken; and � issues of fairness and justice, including the utility of extending the attorney-client privilege and the prejudice the receiving party would suffer. While Goldner did little to prevent the documents’ disclosure, he reiterated that the company was under pressure to hand the documents over to Cimco. However, he said, the fact that Goldner handed over 21 confidential documents worked in Cimco’s favor. But, he concluded, the final two factors militated in favor of Goldner. “Goldner acted quickly once it became aware of the documents’ disclosure. … In addition, it is still possible to protect Goldner’s interests by precluding Cimco’s use and retention of the documents, and there is no evidence that returning the documents would prejudice Cimco in any way,” Herron said. Not requiring Cimco to hand over the documents would also punish Klenzoid, the defendant that immediately complied with Goldner’s request. “By halting its review of the documents upon recognizing their privileged status and returning the documents promptly, Klenzoid’s counsel properly fulfilled its ethical obligations,” Herron wrote. “Were the court to allow Cimco to use the information in the documents, it would effectively punish Klenzoid, which has no access to this information, for its proper and ethical conduct.”

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.