The attorney-client privilege is one of the cornerstones of the legal profession. Despite the privilege’s sacrosanct nature, there are exceptions to the well-established rule that the communications between an attorney and his client are confidential. For example, under certain circumstances (pre-representation disclosures and waivers are needed), an attorney who represents multiple clients in the same matter can share communications among those involved in the joint representation, without waiving the attorney-client privilege as to those who are not part of the joint representation (i.e., the rest of the world). But what happens when infighting arises among those who were parties to the joint representation? This issue was recently analyzed by the U.S. District Court for the District of Delaware in Newsome v. Lawson, 2017 WL 6334979 (D. Del De. 12, 2017).
In Newsome, a liquidating trustee on behalf of a bankruptcy debtor filed a legal malpractice lawsuit against a group of lawyers based on their roles as attorneys for both the debtor and the debtor’s parent company. The lawyers had an attorney-client relationship with both the parent company and its wholly-owned subsidiary, the debtor. The lawyers refused to produce certain documents in the legal malpractice lawsuit asserting that such documents were protected by attorney-client privilege. The trustee moved to compel. The District of Delaware had to determine whether the former attorneys, who jointly represented both entities, could claim privilege in a subsequent litigation filed by one of the joint-clients against the attorneys. The district court ruled that the attorney-client privilege did not apply in this context.
In reaching this conclusion, the Newsome court noted that other courts addressing this factual scenario have uniformly held that a joint client suing only the joint attorney can compel the disclosure of privileged documents from the joint representation. Ultimately, when joint clients engage a single attorney, their expectations are such that the disclosures among those parties are not protected from disclosure within that group, so long as the communications relate to the common representation. The District Court of Delaware concluded that these adverse-litigation and breach of duty exceptions applied in the joint representation context. Traditionally, the adverse litigation exception provides that all communications made during a joint representation are discoverable when former joint clients sue one another. The breach of duty exception provides that in a lawsuit between an attorney and a client based on an alleged breach of duty by the lawyer, attorney-client communications relevant to the breach are not protected by the attorney-client privilege. Notably, Florida adopted this exception in Rule 4-1.6(c) of the Florida Rules of Professional Conduct. These two exceptions to attorney-client privilege apply with equal force to the context in which a former joint client sues the joint attorney in subsequent litigation, even if the other joint client does not consent to the disclosure.
The Newsome case is a reminder to lawyers to inform their joint clients of the risks and advantages of a joint representation before undertaking such representation. Indeed, Rule 4-1.7(c) of the Florida Rules of Professional Conduct requires attorneys to do this. Thus, the contours of the joint representation should be well-defined and in writing. All parties should understand the scope of the common representation and that communications that fall within that scope are essentially an open book to those involved in the joint representation, even in the event that subsequent litigation arises among parties in the group. The parties to the joint representation should consider defining how such communications will be treated in subsequent litigation even if they do not maintain a privileged status. For example, will such communications still be treated in a confidential fashion so as to limit the disclosure to parties who were never part of the joint representation? The parties should also consider and define what will happen in the event a conflict develops among the joint clients.
Ultimately, while the attorney-client privilege is a cornerstone of the legal profession, it is not impenetrable. Communications among those in a joint representation can be used in subsequent litigation arising among the group or portions of the group.
Merrick L. “Rick” Gross is a shareholder with Carlton Fields in the firm’s Miami office, where he chairs the firm’s national trial practice business litigation section. He has a multifaceted commercial litigation practice including aspects of banking litigation, real estate litigation, creditors’ rights litigation, securities matters, and business torts litigation. He can be reached at email@example.com.
Yolanda P. Strader is an attorney in the firm’s Miami office, and is a member of the firm’s national trial practice business litigation section, She handles a variety of complex litigation matters including banking litigation, business torts, and real property litigation. She can be reached at firstname.lastname@example.org.