Michael J. Hutter

In today’s increasingly complex legal environment, attorneys may need the assistance of professionals, e.g., scientists, engineers, physicians, accountants, investment bankers and even, public relations specialists to effectively and competently advise their clients. Working with these professionals will often require the disclosure to them of attorney-client privileged information. Does such disclosure result in the loss of privilege protection? In Gottwald v. Sebert, 58 Misc.3d 625 (Sup. Ct. N.Y. Co. 2017), this issue was addressed in the context of the disclosure of privileged information to a public relations firm retained by defendant’s attorney in pending litigation. In a thoughtful decision, Supreme Court judge Shirley Werner Kornreich held that upon the facts before the court the disclosure of certain documents prepared by defendant’s attorney and disclosed to the firm were not protected by the privilege because the disclosure was made purely for public relations purposes and not for the purpose of providing or obtaining legal advice. Notably, while Judge Kornreich ruled against the attorney, she did not hold that disclosures to a public relations firm will always result in a loss of privilege protection. Rather, the privilege may still be applicable in a given case.

While the decision is helpful in providing guidance to attorneys as to when, if ever, disclosures to a public relations firm will result in the loss of privileged protection, its real significance is its recognition that in certain circumstances disclosing to professionals will not strip the disclosed information of its privileged protection and then identifying those circumstances. Since this issue has not received much attention in the New York State courts, this column will address it, drawing upon Judge Kornreich’s rationale in finding loss of privilege in the facts before the court.

Confidentiality and Waiver

Ordinarily, the protection given to confidential consultation ceases, or is often said to be “waived,” when otherwise privilege communications are disclosed to a third party. Ambac Assur. v. Countrywide Home Loans, 27 N.Y.2d 616, 624 (2016) (“[A] client waives the privilege if a communication is made in confidence but subsequently revealed to a third-party.”). However, exceptions have been recognized. See generally Barker and Alexander, Evidence in New York State and Federal Courts (2d ed.) §5:7; Martin, Capra & Rossi, NY Evidence Handbook (2d ed.) §5.2.2. Thus, an attorney may disclose privileged communications to other law firm attorneys, as well as to non-attorney staff, such as paralegals, secretaries, file clerks, computer operators, office managers, IT personnel, and similar law-firm employees, who are assisting in the legal representation involved. Kenneth Broun, McCormick on Evidence (7th ed.) §91; Restatement (Third) of the Law Governing Lawyers §70. A “joint client” exception has been recognized which permits persons with a common interests and who retain the same attorney to exchange confidential information with each other and their attorney. See Wallace v. Wallace, 216 N.Y. 28, 35 (1915), citing Hurlburt v. Hurlburt, 128 N.Y. 120, 124 (1891). More recently, the Court of Appeals in Ambac Assur. v. Countrywide Home Loans, 27 N.Y.2d 616, 624 (2016), recognized a “common interest” exception applicable in both criminal and civil actions under which a confidential communication disclosed to a third-party remains privileged if the third-party shares a common legal interest with the client and the communication was made in furtherance of that common legal interest and the communication relates to pending or anticipated litigation. See Ambac, 27 N.Y.3d at 628-29.

The Court of Appeals has not addressed the issue of waiver and an exception thereto when the disclosure is made to a third-party professional who is retained by the attorney to assist the attorney in providing legal advice to the client. However, in People v. Osorio, 75 N.Y.2d 80, 84 (1989), the court held that the use of a hired interpreter to translate the communications between a client and attorney who speak different languages did not defeat the communications privileged status. The court also “indicated in Osorio its acceptance of the notion that a person … who is retained by either the attorney or the client to “facilitate” communication may participate in attorney-client discussions without a loss of privilege.” Barker, supra §5.7, at p. 294. Notably, in support of its interpreter holding and “indication” the court cited, favorably, United States v. Kovel, 206 F.2d 918 (2d Cir. 1961).

‘Kovel’ Doctrine

In Kovel, the Second Circuit adopted what has come to be called the “Kovel doctrine.” Kovel was an accountant who had substantial accounting experience and knowledge of the IRS Code and IRS regulations. He was employed by a law firm and had performed accounting work on behalf of a firm client. The client was under investigation for tax fraud, and Kovel was subpoenaed to testify before a federal grand jury. He refused to testify, asserting that any information he had obtained from the client was protected by the attorney-client privilege. Kovel was then held in contempt.

The Second Circuit in an opinion authored by Judge Henry Friendly vacated the contempt citation. Initially, the court rejected Kovel’s argument that his status as an employee of the law firm automatically made all communication to him for clients privileged. This rejection was based upon the court’s view that to hold otherwise would encourage attorney abuse involving the placing of accountants and other professionals on the firm’s payroll just to obtain privileged agent status. Kovel, 296 F.2d at 921.

Nonetheless, the court found the privilege applicable but on another basis. The court likened the role of an accountant to that of a translator, who work would indisputably be privileged. In that regard, the court commented that to many attorneys, accounting concepts are a foreign language and the services of an accountant are helpful to the attorney for understanding the client’s financial information. Id. at 922. Thus, a communication will be privileged if the client is instructed by the attorney to tell his or her “story” to an accountant retained by the attorney, who is then to interpret it for the attorney so that the attorney “may better give legal advice.” Id. Citing Henry Wigmore’s evidence treatise, the court then held that the privilege must extend to those professionals who are “indispensable” to an attorney’s ability to represent a client, provided the communications were in fact made for the “purpose of obtaining legal advice.” Id. at 921, 922. The court then remanded the matter for an “inquiry into the existence of the privilege.” Id. at 924.

Kovel has been adopted or applied by numerous federal courts (see Robert Anello and Miriam Glaser, “White-Collar Crime,” 85 Fordham L. Rev. 39, 67-68 (2016); Scott v. Chipotle Mexican Grill, 94 F. Supp. 3d 585, 591-92 (S.D.N.Y. 2015) (collecting and discussing cases)), extending its holding to civil cases involving professionals in various areas of expertise, and not just accountants. In so applying Kovel, the courts have emphasized that its rule will not be automatically extended to all professionals who are hired by the client or attorney to assist the attorney in a matter involving the client. Rather, the touchstone of a Kovel inquiry is whether the professional has been retained for the purpose of improving the attorney’s comprehension of factual information or the client’s comprehension of legal advice provided by the attorney. In this regard, the courts have consistently held that if the professional is retained for other purposes, e.g., business, financial or tax advice, accounting services, engineering work, the Kovel doctrine does not apply. See, e.g., United States v. Adlman, 68 F.3d 1495, 1500 (2d Cir. 1995); Dahl v. Bain Capital Partners, 714 F. Supp. 2d 225, 229 (D. Mass. 2010).

‘Gottwald’ and ‘Kovel’

As noted above, the New York Court of Appeals in Osorio “indicated” that it would adopt the Kovel doctrine as set forth by the Second Circuit, and as applied by Kovel’s progeny. Such adoption seems more likely now as Kovel’s rationale is consistent with rationale used by the Court of Appeals in adopting the common interest exception in Ambac. (For a discussion of Ambac, see Michael J. Hutter, “Attorney-Client Privilege and Related Common Interest Doctrine,” N.Y.L.J., Aug. 2, 2016.) Notably, Judge Kornreich reached the same conclusion. Gottweld, 58 Misc.3d at 631, n. 10. In that regard, she recognized that “[e]xperts often are needed to explain complex subject matter to an attorney where the attorney lacks the requisite expertise but where such expertise is essential to the [attorney’s representation].” Id. Consistent with this thought, Judge Kornreich aptly observed that the Kovel doctrine furthered an underlying policy of the privilege “to facilitate a client’s ability and willingness to communicate frankly with a lawyer to maximize the lawyer’s capacity to competently provide legal advice.” Id. at 637.

Turning now to Judge Kornreich’s application of Kovel, Gottweld, a defamation action, arose out of the artist Kesha’s repudiation of her longstanding exclusive recording agreement with Lukasz Gottwald, a well-known music producer. Kesha’s attorney hired Sunshine Sachs, a public relations firm, as part of a strategy to induce Gottwald to quickly settle and to influence of the prospective jury pool if the case went to trial. The strategy involved how best to spin information to Kesha’s benefit. Documents provided to the firm revealed Kesha’s attorney’s legal advice, which documents would be ordinarily privileged. Gottwald moved to compel disclosure of these documents, and Kesha opposed the motion, arguing the disclosures did not cause the loss of privileged status through the application of the Kovel doctrine.

Judge Kornreich’s legal discussion started with her recognition that it was necessary to determine whether a public relations strategy, or a legal strategy was involved, the former falling outside Kovel, and the latter encompassed by Kovel. Id. at 635. Her review of the documents in camera showed to her that the focus of the communications was to ensure that legal developments in the case were being given their desired media spin. In Judge Kornreich’s opinion, that was “not coordination to facilitate legal advice.” Id. at 637. Thus, Kovel did not apply to prevent the loss of privilege upon the disclosure of the information to the public relations firm.

Interestingly, Judge Kornreich discussed several New York federal court decisions involving the application of Kovel to disclosures to public relations which informed her analysis. Id. at 629-36. Each of these decisions in turn cited and relied upon Kovel.

As previously noted, Judge Kornreich did not at all conclude or otherwise suggest that disclosure to public relations firms will always defeat the privilege. Rather, she recognized that Kovel can be applicable depending upon the task at hand. For example, if in a defamation action the client’s attorney needed to coordinate to ensure that public statements made would not expose the client to further defamation liability and the communications purpose was to craft statements with a view toward that concern, Kovel would “indisputably” apply. Id. at 635. Another example of Kovel’s application would be a situation where disclosure to Sunshine Sachs was necessary for the firm to understand the underlying contractual documents which would be necessary for the firm to do its job. Id. at 637.


In sum, Gottweld is an instructive decision. It provides guidance to attorneys who seek to engage not only public relations firms, but other professionals, to assist them in providing effective representation to their clients as to when disclosure of confidential information to those professionals would defeat the privilege and when disclosure will not.

However, Gottwald, like Kovel, does not provide a bright-line as to when Kovel will apply in a given situation. The attorney will still have to weigh the need for professional assistance against the risk of loss of privilege for privileged documents by reason of disclosures to that professional. The best that can be said is that the attorney should consider a Kovel letter when engaging the services of a professional. Such letter will state the terms of the engagement, the legal purpose of the professional services, and that any communication involved in rendering those services are confidential and that their confidentiality must be maintained. See Attorney Professionalism Forum, 88 NY State Bar Journal (Oct. 2016), p. 57. Such a letter may help in convincing a court that the communications are Kovel-protected.

Michael J. Hutter is a Professor of Law at Albany Law School and is special counsel to Powers & Santola. He is currently serving as the Reporter to the Judicial Advisory Committee on Evidence, which is charged with compiling and publishing on the Unified Court System’s website a Guide to New York Evidence.