South Carolina Lawyer
SC Lawyer, May 2008, #3.
Joint Defense Agreements
South Carolina LawyerMay 2008Joint Defense AgreementsBy Gray Culbreath"The enemy of my enemy is my friend," so goes an old Arab proverb. Often litigation will create alliances among parties who want to cooperate in pursuit of a common goal or strategy. The means by which to memorialize such an agreement is through a document called a joint defense agreement. This article will address the evidentiary origins of the joint defense agreement, the practical considerations in drafting and entering into a joint defense agreement and the ethical concerns surrounding their creation. The concept of the joint defense agreement has been addressed by very few South Carolina courts. In fact, a search of South Carolina state and federal courts reveals only one case. Fort v. Leonard, 2006 WL 2708321 (D.S.C. September 20, 2006). Therefore, the validity, scope or applicability of a joint defense agreement is still largely unaddressed by our courts. For previous discussions of the joint defense privilege and related doctrines, see 6 Jun. S.C. Lawyer 12 and 16 Jul. S.C. Lawyer 11.
The joint defense agreement arises from the common law doctrine known as the joint defense privilege. The rationale is that "persons who share a common interest in litigation should be able to communicate with their respective attorneys and with each other to more effectively prosecute or defend their claims." In re: Grand Jury Subpoenas 89-3 & 89-4c, John Doe 89-129, 902 F.2d 244, 249 (4th Cir. 1990). Over time, this doctrine has been given at least 15 different names. These names include the common interest privilege, the community of interest privilege, the joint defense privilege, the joint prosecution privilege, the joint privilege and the pooled information privilege. No matter the name, the doctrine is an exception to waiver of privilege that allows parties with a common interest in actual or potential litigation to share confidential information without waiving the privilege. See, Restatement (Third) of the Law Governing Lawyers § 76 (2000). The Fourth Circuit has recognized the joint defense privilege and common interest rule as the same or similar doctrines. See U.S. v. Duke Energy Corp., 214 F.R.D. 383, 389 (M.D.N.C. 2003).
Who can invoke a joint defense?
Before the reader sees the word "defense" and discounts this article's applicability to his practice, please consider that courts have applied the joint defense privilege in a variety of different contexts and to a variety of different parties. While typically phrased in terms of a "defense" privilege, the joint defense privilege can apply to any two parties who have a common interest in current or potential litigation either as actual or potential defendants, or plaintiffs. Prevue Pet Prods., Inc. v. Avian Adventures, Inc., 200 F.R.D. 413, 417 (N.D. Ill. 2001); In re Grand Jury Subpoenas, 902 F.2d at 249 (4th Cir. 1990) (indicating the joint defense privilege applies "whether the jointly interested persons are defendants or plaintiffs"). Courts have extended the rule to cooperating plaintiffs, Sedlacek v. Morgan Whitney Trading Group, 795 F. Supp. 329, 331 (C.D. Cal. 1992), companies that had been individually summoned before a grand jury who shared information before any indictment was returned, Continental Oil Co. v. United States, 330 F.2d 347, 349-50 (9th Cir. 1964), parties in bankruptcy, In re Bevill, Bresler & Schulman Asset Management Corp., 805 F.2d 120, 126 (3d Cir. 1986), to potential co-parties in prospective litigation, In re LTV Securities Litigation, 89 F.R.D. 595 (N.D. Tex. 1981), plaintiffs who are pursuing separate actions in different states, Schahar v. American Academy of Ophthalmology, Inc., 106 F.R.D. 187, 191-92 (N.D. Ill. 1985), civil defendants sued in separate actions, Transmirra Products Corp. v. Monsanto Chemical Co., 26 F.2d 572, 576-77 (S.D.N.Y. 1960), insured and insurer defending against a common plaintiff, Lectrolarm Custom Systems v. Pelco Sales, 212 F.R.D. 567, 572 (D.C. Cal. 2002), competitors seeking to have rival patents declared invalid, Power Mosfet Technologies v. Siemens AG, 206 F.R.D. 422, 425 (E.D. Tx. 2000), and co-parties who share a common interest, Sheet Metal Workers International Ass'n v. Sweeny, 29 F.3d 120, 124 (4th Cir. 1994). This includes a plaintiff and defendant in the same litigation with a common interest in defending a counterclaim and cross claim brought by a common co-defendant. Visual Scene, Inc. v. Pilkington Bros., 508 So. 2d 437, 440-41 (Fla. Dist. Ct. App. 1987). Courts have also applied it to non-litigants if they consult the same attorney or have a strong common legal interest. In the Fourth Circuit, this privilege among parties is recognized where the facts show an actual agreement in relation to the prosecution or defense of claims. LaSalle Nat'l Bank Ass'n v. Lehman Bros., 209 F.R.D. 112, 116 (D. Md. 2002).
The historical origins of the joint defense privilege
It is generally accepted that the joint defense privilege first arose in Chahoon v. Commonwealth, 62 Va. (21 Gratt) 822 (Va. 1871), a Virginia criminal case involving two defendants. There, the court held that a criminal defendant had not waived the attorney-client privilege by disclosing confidential information among counsel to criminal co-defendants. Because communications and work product are presumably protected between two...