Another federal court reminds companies and their in-house counsel of two important privilege issues. First, the fact that in-house lawyers send or receive internal emails does not automatically render the emails privileged. Second, the failure to take steps to prevent inadvertent disclosure will result in privilege waiver.
The court ruled that the attorney-client privilege covering 347 emails involving 3 in-house lawyers was waived through an inadvertent disclosure. Inhalation Plastics, Inc. v. Medex-Cardio-Pulmonary, Inc., 2012 WL 3731483 (S.D. Ohio Aug. 28, 2012). You may read the opinion here.
In this case, Medex Cardio-Pulmonary, Inc. produced 7500 documents that contained 347 emails either sent or received by in-house counsel. When the plaintiff attempted to depose two of these lawyers based on the production, Medex asserted the attorney-client privilege and claimed they inadvertently produced the emails.
Meet the Burden
The court first questioned whether Medex met its burden of proving whether the privilege covered the emails. It noted that “[t]he mere fact that [the in-house lawyer] was the sender or recipient of the documents at issue does not render them privileged.”
The Court found that the burden was not met because Medex did not identify which of the 347 emails the privilege covered, did not provide a privilege log, and offered little factual evidence that the communications pertained to legal advice.
But the Court’s in camera review revealed that some emails were, in fact, privilege. The court then evaluated whether the inadvertent disclosure of these documents constituted waiver. The Court considered the following 5 factors in its analysis:
- The reasonableness of the precautions taken in view of the extent of document production;
- The number of inadvertent disclosures;
- The magnitude of the disclosure;
- Any measures taken to mitigate the damage of the disclosures; and
- The overriding interests of justice.
The Court ruled that Medex did not prove that it took reasonable precautions. Medex did not specify who reviewed the documents pre-production or the steps taken to review for privilege, and did not provide a privilege log. The disclosure of 347 of 7500 privileged emails was significant. And, although Medex acted promptly upon learning of the disclosure, it failed to comply with Fed. R. Civ. P. 26(b)(5)(B) to identify the privileged documents with specificity and explain why they are protected from disclosure. For these reasons, the Court found that Medex waived the attorney-client privilege.
The Inhalation Plastics decision reminds corporate and outside counsel that producing a significant number of documents requires diligent efforts on the front-end and back-end of the production. In-house and outside counsel must not only conduct a pre-production privilege review, but must be able to specify the measures taken to prevent inadvertent disclosure.
And while inadvertent disclosures may nevertheless occur in large productions, counsel must act swiftly to notify the other party. Counsel must exercise discipline to provide a detailed privilege log and explaining, in writing, the basis for the privilege claim.