26.15 - B. Important Differences

• Jurisdiction: New York

B. Important Differences

In-house counsel at a corporation are still bound by the rules discussed above governing the attorney-client privilege, but they must work with them in a very different environment. This environment poses unique challenges with respect to the privilege.

1. The client is the corporation. First, the client in the attorney-client relationship is the corporation. While the client may function through senior decision-makers at the company (often called the “control group”), ultimately the attorney’s first allegiance is to the company. ³⁷⁵⁸ This can pose complications if the attorney’s ability to provide legal services is hindered by employment pressures.

2. Attorney-client privilege only applies to legal communications. One particularly difficult issue to navigate concerns the dual rules held by some in-house counsel and the sometimes dual nature of the attorney’s work. In Rossi v. Blue Cross & Blue Shield, ³⁷⁵⁹ the New York Court of Appeals noted that “unlike the situation where a client individually engages a lawyer in a particular matter, staff attorneys may serve as company officers [or in other non-officer capacities], with mixed business-legal responsibility.” ³⁷⁶⁰ This “day-to-day involvement in their employers’ affairs may blur the line between legal and non-legal communications.” ³⁷⁶¹ Not every communication between in-house counsel and employee is privileged. As a general rule, “[w]here an attorney and his client are engaged in business dealings . . . the attorney-client rule does not apply.” ³⁷⁶²

No specific test exists for distinguishing between legal and non-legal communications as this is a very fact-specific analysis. However, the N.Y. Court of Appeals has outlined several “guideposts” for analyzing whether the privilege applies.

The communication from the client to the attorney “must be made for the purpose of obtaining legal advice and directed to an attorney who has been consulted for that purpose.”³⁷⁶³

Any communication from the attorney to the client must be made for the purpose of providing legal advice or services “in the course of a professional relationship.”³⁷⁶⁴

The communication is primarily or predominantly of a legal character. The privilege is not lost if there are non-legal matters discussed in the communication.³⁷⁶⁵

PRACTICE TIP: Some officers and employees may believe that the privilege applies simply by copying an in-house attorney on an email or inviting the attorney to be on a call or in...