In what Grub Street dubbed “the most New England crime ever,” a co-owner of a Maine lobster wholesale company allegedly embezzled millions of lobsters by diverting them to his shell company. But when the lobster wholesaler sent its lawyer’s emails to the FBI for its investigation, a court found privilege waiver and snatched those emails from the wholesaler’s claws. Sea Salt, LLC v. Bellerose, 2020 WL 2114922 (D. Maine May 4, 2020).  You may read the decision here.

But what about subject-matter waiver for the undisclosed emails on the same topic? Let’s discuss this lobster caper.

 “So, Like 20 Lobsters”

Sea Salt, LLC, a lobster wholesaler, discovered that one of its co-owners allegedly diverted the company’s lobsters to his shell company. The shell company allegedly sold a number of the crustaceans for a total of $1.5M, “so,” as Grub Street said, “like 20 lobsters.”

FBI and Motion to Compel

While the magnitude of the disclosure is unclear, Sea Salt at some point sent some of its lawyer’s emails—clearly privileged communications—to the FBI to assist in the FBI’s investigation. In Sea Salt’s civil suit against the former co-owner and an alleged host of co-conspirators, a defendant moved to compel the emails actually disclosed to the FBI, claiming privilege waiver.

FRE 502 Not on Point

Sea Salt’s response was a bit off base. It claimed that FRE 502 permitted the disclosure without a concomitant waiver problem. This rule, it argued, applied because Sea Salt disclosed privileged communications to a federal agency.

The Court gently pointed out that FRE 502 outlines a subject-matter waiver analysis for undisclosed privileged communications. The rule does not address waiver for disclosed privileged communications.  And here, the defendant only sought production of the lawyer’s emails that Sea Salt disclosed to the FBI.

Ruling—No Doubt About Waiver

The Court found that Sea Salt intentionally disclosed privileged communications to the FBI. As a result, “there is no doubt that [Sea Salt] waived any privilege it might have claimed” to the disclosed emails. And here is the reason:

Disclosure of information to law enforcement, presumably in connection with a criminal investigation of one or more of the defendants, would be disclosed in a way inconsistent with keeping it from the defendants insofar as the information would likely be disclosed as part of any criminal proceeding.

We often see privilege-waiver findings when companies disclose privileged communications to a law-enforcement agency in an effort to trigger a criminal prosecution. You may read about a similar incident in Court Rejects Joint–Prosecution Privilege Between Company and USAO.

Work Product Waiver, Too?

As we know, courts apply a different waiver analysis for the disclosure of work-product material. And here, the Court refused to address this potential difference because Sea Salt provided the Court with no information from which it “could make such an assessment.” In short, it appears Sea Salt failed to develop the work-product issue. Could that have saved production of some or all of the emails?

I Mentioned the Lobster Bisque

The defendants in Sea Salt, perhaps strategically, did not seek production of nondisclosed privileged communications that relate to the same subject matter of the disclosed communications. As the Seinfeld cast would say, it “yada yada’d” over the nondisclosed communications but “mentioned” the disclosed emails, much like Elaine “mentioned the lobster bisque” in this hilarious scene.

But is that the next motion to compel? If so, then FRE 502 would supply the analysis, and the Court would ask whether the undisclosed communications “concern the same subject matter” and, if so, whether “they ought in fairness to be considered together.” Perhaps that is the next claw to drop in this lobster caper.

In a wrongful-discharge case involving Brigadier General (ret.) Steven Anderson, the 4th Circuit reversed a district-court decision and upheld an in-house-lawyer-led internal investigation into Anderson’s alleged conflict of interests. The Court upheld the privilege even though the company–employer disclosed certain investigation results to the Department of Defense (DOD) and the U.S. Army. In re Fluor Intercontinental, Inc., 2020 WL 1487700 (CA4 Mar. 25, 2020). You may read the opinion here.

Improper Conduct?

BG Anderson, a West Point graduate and highly decorated military veteran, worked for Fluor Corporation, a DOD contractor, as its Country Manager for Afghanistan. Fluor received an ethics hotline complaint alleging that Anderson had a potential conflict of interest in Fluor’s plans to award a subcontract for local Afghan labor to Relyant Global.

Internal Investigation

The Fluor legal department, in accordance with its internal policies and procedures, initiated an internal investigation. Fluor’s senior in-house counsel, Karen Douglas, led the investigation but effectively delegated it to Corporate Investigators, most of whom are former law-enforcement officers.

Douglas, however, maintained control over the investigation. She instructed the Corporate Investigator on documents to review and witnesses to interview. She instructed him to advise the witness that the interviews were confidential and privileged. And she instructed him to report the results to her. She used the investigation results to advise Fluor on legal issues related to the purported conflict of interest.

For an excellent example of how to persuade a court that an in-house lawyer conducted a privileged internal investigation, read lawyer Douglas’s declaration, available here.


As a government contractor, Fluor had a regulatory obligation under 48 CFR § 52.203.13 to disclose certain information to the DOD’s Office of Inspector General.

So, Fluor provided the DOD with a “summary of the facts” of the internal investigation and copied the U.S. Army. Did this disclosure waive the privilege that Fluor’s legal department worked so hard to protect?

District Court Ruling

Based on the investigation results, Fluor terminated Anderson’s employment, and Anderson filed a wrongful-discharge suit. Anderson later moved to compel production of Fluor’s investigation materials. While the investigation seems privileged, the question arose whether Fluor waived the privilege over the entire investigation materials by disclosing investigation results to the DOD and U.S. Army

The District Court found that Fluor’s disclosure of its summary factual findings revealed attorney–client communications because it reached conclusions that “only a lawyer is qualified to make.” Thus, it found privilege waiver. And not just waiver—subject-matter waiver.  You may read the District Court’s opinion here.


In a per curiam opinion, the 4th Circuit found that the District Court’s conclusion was “clearly and indisputably incorrect.” The Court emphasized that waiver occurs upon a disclosure of a communication or information protected by the privilege. The Court declined to “infer a waiver merely because a party’s disclosure covers ‘the same topic’ as that on which it sought legal advice.”

Courts must “distinguish between disclosures based on the advice of an attorney, on the one hand, and the underlying attorney–client communication itself, on the other.” The District Court’s finding that Fluor’s summary provided to the DOD contained conclusions “only a lawyer could make” was the wrong test.  “Instead, to find waiver, a court must conclude that there has been disclosure of protected communications.” (emphasis by the court).

POP Analysis

For those companies subject to regulation-mandated government disclosures, the 4th Circuit’s focus on disclosure of communications—rather than information on the same topic of those communications—is a distinction worth remembering. The Fluor decision shows that a company can successfully thread the privilege-waiver needle by meticulously avoiding disclosure of an employee’s communications with in-house counsel or its designated investigator.

Lord Chancellor and noted philosopher Francis Bacon once quipped that “A prudent question is one-half of wisdom.” Today, one might say that a wise lawyer avoids privilege objections by asking prudent questions.

Objection: Privileged!

We know that federal civil-procedure rules and their state-law equivalents limit lawyers’ opportunities to instruct deposition witnesses not to answer a question. And the primary situation is an objection “when necessary to preserve a privilege.” FRCP 30(c)(2).

When considering an objection based on the attorney–client privilege, lawyers defending depositions must quickly decipher whether the question calls for the disclosure of a confidential communication between a client and her lawyer made for legal-advice purposes. Another instant consideration is whether the client has waived the privilege, either intentionally or by placing her privileged communications at issue in the lawsuit.

Deposition-defending lawyers often assert privilege objections at the slightest hint that a question calls for the disclosure—directly or indirectly—of privileged communications. And rightfully so—lawyers have a duty to safeguard their client’s privileged information. But facts aren’t privileged, and herein lies many privilege disputes at depositions: the questioning lawyer wants facts but instead unnecessarily asks for communications.

An Illustration

The court’s deposition-privilege-objection ruling in Cook v. Fullerton Supportive Housing, L.P. provides a terrific illustration that creative, tailored questions are necessary to circumvent legitimate privilege objections and instructions not to answer. 2019 WL 8017805 (C.D. Cal. Dec. 12, 2019). You may read the decision here.

In this case, two tenants sued their landlord’s property-management company for failure to prevent another tenant’s racially harassing behavior. The property-management company defended, in part, on grounds that it had the legal right to take certain actions or inactions.

Plaintiffs’ counsel deposed a company employee, and this exchange ensued:

Q.      Did [the company] ever send a 60-day notice to [the harassing tenant] trying to cancel her lease because of the action she’d taken against my clients?

A:      No.

Q:      Why not?

Lawyer: Objection to the extent it calls for attorney-client privilege . . . It’s an attorney-client privilege. And I’m telling you there’s attorneys involved in this case determining actions that were taken and weren’t taken.

The company argued that answering this non-specific question would reveal why the company did or did not take legal actions against the harassing tenant. The court, in an opinion by Magistrate Judge Spaeth, agreed.

Rulings and Practice Tips

The judge said that deposition questions asking why a witness took a course of action may reveal privileged communications “when the action was based on the advice of counsel.” Judge Spaeth then offered this practice tip:

Traditionally, deposing counsel will ask follow-up questions to determine an individual witness’ personal knowledge and to determine whether the witness can give non-privileged testimony in response to the initial question.

As to this particular question, the deposing lawyer did not ask the follow-up questions to circumvent the privilege objection. Objection sustained.

The deposing lawyer later asked more penetrating questions, including this exchange:

Q.     At any time did you ever make an independent decision that you needed to terminate [the harassing tenant’s] tenancy because of the way she was behaving toward my client?

Lawyer: And I’m going to tell her to not answer on the grounds that it’s attorney-client privilege.

Here, Judge Spaeth noted that deposition questions that “ask about a witness’ independent reasons for taking a course of action inquire about facts, not communications.” Counsel’s question seeking the deponent’s “independent decision” sought a fact, not a communication with the company’s lawyer.  Objection overruled. For more example deposition questions, read the excerpts here. And to review the parties legal positions, read their joint brief here.

More Tips

Judge Spaeth provided more practice tips.  While the lawyer’s question here, unlike the first question, navigated around the privilege objection, Judge Spaeth noted that the questioning lawyer “may well have asked”: “At any time did you ever make an independent decision, independent of advice of legal counsel, to issue a notice?” (emphasis by Judge Spaeth).

The judge noted that “the phrasing of deposition questions necessarily excludes attorney advice on their decisions and, as such, there is no possibility that the witness’ answers would disclose confidential communications.”

In other words, the judge’s advice is that a lawyer’s deposition preparation must include anticipating privilege objections and crafting specific questions to circumvent the inevitable objection. Prepare questions that seek facts based on personal knowledge rather than non-specific questions that conceivably call for the disclosure of privilege communications.

Not many courts provide practice tips for lawyers. Judge Spaeth did so here, and I think we should heed them.

Perhaps that is the other one-half of wisdom.