Attorney-Client Privilege for In-House Counsel

• Author: Doug Gallagher - Manasi Raveendran
• Position: Doug Gallagher is a registered patent attorney and a partner at the Indianapolis, Indiana, office of SmithAmundsen LLC. He has degrees in physics and aerospace engineering and focuses his practice on intellectual property law. Prior to his law career, Doug was a fighter pilot and test pilot in the US Navy. He can be reached at dgallagher...
• Pages: 41-65

By Doug Gallagher and

Manasi Raveendran

Attorney-Client

Privilegefor In-House

Counsel

Image: iStockPhoto

Published in Landslide® magazine, Volume 10, Number 2, a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved. This

information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.

Published in Landslide® magazine, Volume 10, Number 2 , a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved. This

information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.

The doctrine of attorney-client privilege is one of the more

complicated and nuanced areas of an attorney’s practice.

As in-house counsel, privilege is even more compli-

cated because the client is not simply a person, but rather

a corporate entity with numerous people working to advance the

interest of the corporation. Additionally, the dual role of in-house

counsel as a trusted legal advisor and a business advisor and the

various different scenarios in which privilege can arise further

complicate the issue of attorney-client privilege for in-house coun-

sel. Because determining whether attorney-client privilege applies

is inherently a fact-sensitive analysis, this article aims to provide

an overview of the attorney-client privilege in general, specic

issues facing in-house counsel, and nally, some practical guid-

ance on how to address privilege issues in the corporate setting.

What Is the Attorney-Client Privilege?

The basis for the attorney-client privilege is the principle that cli-

ents and attorneys should be able to communicate in a free and

frank manner.1 The privilege belongs to the client and is a pro-

tection provided by various statutes and common law for certain

communications between the client and the client’s attorney to

encourage full disclosure of information between the client and

the attorney. It is important to note that in-house counsel for

large, multistate, and multinational corporations should be care-

ful when analyzing issues of attorney-client privilege because the

federal courts, each state, and each county have different rules.

Nevertheless, there are some rules that generally apply to most,

if not all, jurisdictions. For attorney-client privilege to apply to a

communication, the general rules require that: (1)the communica-

tion be between a client and an attorney (i.e., an individual having

a law degree and bar membership, and acting as an attorney for

the client) or an agent of an attorney (e.g., a tax accountant, a pat-

ent agent, a forensic investigator, a technical analyst, or an expert);

(2)the communication be made by the client and contain con-

dential information; (3)the communication be made outside

the presence of a nonprivileged third party; (4)the communica-

tion be made for the purpose of securing legal advice; and (5)the

privilege has not otherwise been waived.2 Privileged communica-

tions can be written or oral, but only communications between or

among “privileged” persons are protected.3

It should be noted that the attorney-client privilege and the

attorney work product doctrine—its close relative—can work

together to keep certain communications out of the reach of

opposing counsel during litigation. While this article will not

delve into the details of attorney work product doctrine, in-house

counsel should also consider whether the attorney work product

doctrine is appropriate for a particular situation if the in-house

counsel desires to keep certain communications condential.

What Is Not Protected under Privilege?

Attorneys and clients would be unwise to consider all com-

munications between the clients and attorneys as receiving

the privilege protection.

First, the underlying facts of a matter are always discover-

able. Privilege cannot (and should not) be used to protect facts

from being discovered. This principle has been routinely upheld

by courts to protect against clients and attorneys “privileging”

everything in order to obfuscate the truth. So, just because a fact

has been told to a lawyer does not give it privilege protection.

For example, if a corporation initiates an investigation into when

the rst public disclosure of an invention occurred, the factual

results of the investigation are not privileged, whereas the legal

advice by the lawyer on the impact of the investigation and rec-

ommended course of action might be privileged.

Second, client communications that do not involve a law-

yer (or a nonlawyer acting as an agent for a lawyer) are not

privileged, even if the communication originally came from

an attorney, is subsequently forwarded to an attorney for

advice, or concerns how to handle a legal situation.

Lastly, privilege cannot be used to facilitate or conceal a crime

or fraud, such as perjury and witness tampering.4 The crime-fraud

exception is something many clients already know about. In some

states, this exception extends to commissions of civil torts as well,

such as unlawful evictions or intentional iniction of emotional

harm.5 This exception can be applicable in situations where evi-

dence of crime or fraud is only present for the attorney or is only

present for the client (i.e., there is no evidence of improper motive

or conduct on behalf of one of the parties).6 It is also important to

note that, even in situations where an ethical client is communicat-

ing with an outside counsel or law rm, if the client is using the

communication to perpetuate a crime or fraud, those communica-

tions will likely be discoverable.7

When Does the Privilege Matter?

Attorney-client privilege is a pre-hoc protection measure used

in order to protect against production of sensitive documents

during discovery related to adversarial proceedings. While

discovery provisions are applied as broadly and liberally as

possible so that parties can unearth information relevant to

the subject matter of a dispute, parties can assert privilege to

render certain communications undiscoverable. Unprivileged

discovery documents can then be used as evidence during

depositions and at trial (if admissible) and could later be dis-

closed publicly, such as to the media, through court les.

In order to assert privilege in response to a discovery

request by the opposing party, the client’s attorney will produce

a list of documents that they consider protected under privi-

lege, called a “privilege log.” The opposing party can dispute

the privilege and demand discovery of those documents. If the

court agrees with the opposing party, the judge might conduct

an in camera review of the documents and, depending on the

situation, allow discovery of those documents.

In-House Privilege

In the rest of this article, we address the attorney-client privilege

for in-house counsel. Attorneys who work for a corporation play

Doug Gallagher is a registered patent attorney and a partner at the Indianapolis, Indiana, ofce of SmithAmundsen LLC. He has degrees in physics

and aerospace engineering and focuses his practice on intellectual property law. Prior to his law career, Doug was a ghter pilot and test pilot in the

US Navy. He can be reached at dgallagher@salawus.com. Manasi Raveendran is an attorney at IBM Corporation in New York, New York. She

focuses on cybersecurity issues, commercial and technology transactions, and regulatory compliance. She can be reached at mraveen@us.ibm.com.