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Although its roots are in 19th century English law, the fiduciary exception to the attorney-client privilege was first recognized in the United States in Garner v. Wolfinbarger. The fiduciary exception permits shareholder plaintiffs in certain circumstances to pierce the corporation’s attorney-client privilege and gain access to privileged materials upon a showing of “good cause.” The theory is that because management ultimately manages the corporation for the benefit of its shareholders, the shareholders may pierce the privilege upon a proper showing. This Garner exception has been adopted by the federal courts and most state courts, and has been applied in a variety of fiduciary relationships, including ERISA administrators and beneficiaries, estates, trusts, banks and joint ventures, as well as direct shareholder litigation under limited circumstances. The fiduciary exception does not apply to attorney work product. Piercing of attorney work product is governed by the “substantial need/undue hardship” test.

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