The 3rd Circuit’s recent decision in Teleglobe USA, Inc. v. BCE, Inc. (In re Teleglobe Communications, Inc.)[FOOTNOTE 1] is another pronouncement in litigation brought by a financially stressed and bankrupt subsidiary against a financially stable parent. The focus of the decision is whether the activities of in-house counsel were sufficient to waive the attorney-client privilege that the defendant parent corporation asserted to withhold allegedly privileged materials in discovery.

Teleglobe involved the decision of a parent corporation to cease supporting a failing subsidiary and has significant application to issues relating to spin-offs and split-offs. Interestingly, Teleglobe comes on the heels of the 3rd Circuit’s earlier decision in VFB LLC v. Campbell Soup Co.[FOOTNOTE 2] While in both cases the bankrupt plaintiff was not successful, counsel ought to take note of the potentially damaging consequences that may flow from the activities of counsel prior to a separation of the parent and subsidiary on subsequent litigation.

This content has been archived.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]