Commentary on The Yates Memorandum

In 2015, then Deputy Attorney General Sally Yates issued a DOJ memorandum on the subject of Individual Accountability for Corporate Wrongdoing, available in full here.  Known as the Yates Memorandum, the DOJ issued this directive to focus on holding individuals responsible for the illegal acts of the corporations for which they worked.

The memorandum, along with DAG Yates’ subsequent remarks, has generated much debate about whether the DOJ was, at least implicitly, returning to a culture of pressuring companies to waive the attorney-client privilege and work-product doctrine.  Now almost three years old and subject to modification under the Trump Administration, Professor Gideon Mark published an excellent article tracing the DOJ memoranda preceding the Yates Memo, and expressing concern over privilege waiver:

[T]he Yates Memorandum is likely to result in continued waivers of the attorney-client privilege and attorney work product protection, even if the DOJ does not make express requests. Waivers no doubt aid the DOJ in criminal and civil investigations, but they also undermine and weaken the attorney-client relationship and the ability of corporations to effectively negotiate with the DOJ during enforcement actions.

Professor Mark proposes tweaks to the memo, including making explicit that DOJ will not implicitly require privilege waiver for cooperation credit.

Still, the Yates Memorandum could benefit from some tweaking. If the DOJ is serious that it does not seek waivers of the attorney-client privilege or attorney work product doctrine, then it probably should make that explicit. Currently, the Memorandum merely states that the DOJ does not require waivers. This is a very different situation from one in which companies nevertheless feel compelled to waive in order to obtain cooperation credit. Similarly, the DOJ should make clear that participation in a joint defense agreement will have no negative impact on whether, or to what extent, a company receives cooperation credit.

The article is a good read, and not just because it cites my article, co-authored with Ty Howard, titled In-House Counsel: Protecting the Privilege in a Post-Yates Memorandum World, 31 Corporate Counsel, No. 3, June 2016 (available here).  You may access Professor Mark’s article, The Yates Memorandum, 51 U.C. Davis L. Rev. 1589 (2018), here.

Lawyer Reveals Prospective Client’s Communications—How did Disciplinary Board React?

If a lawyer meets with a prospective client but decides—for conflict-of-interest purposes—that he cannot proceed with the representation, do the attorney–client privilege and ethical rules of confidentiality prohibit the lawyer from revealing the prospective client’s communications?  A Nevada lawyer discovered the answer the hard way.  In the Matter of Discipline of Mark A. Beguelin, Bar No. 3675, 2018 WL 2272918 (Nev. May 11, 2018), available here.

The Rule

Model Rule of Professional Conduct 1.18 provides that, except in a narrow circumstance, a lawyer may not reveal information learned from a prospective client, “[e]ven when no client–lawyer relationship ensues.”  The Rule’s comments provide that a person becomes a “prospective client” “by consulting with a lawyer about the possibility of forming a client–lawyer relationship.”  And when that consultation occurs, the Rule imposes a confidentiality requirement on the lawyer, “regardless of how brief the initial conference may be.”

The Privilege

Most jurisdictions similarly hold that the attorney–client privilege protects from disclosure confidential communications between a lawyer and a prospective client.  In his excellent treatise, Testimonial Privileges, privilege guru David Greenwald clearly recounts that the privilege applies to “prospective clients.” David Greenwald, et al., Testimonial Privileges, § 1.23 (3d ed.). The Nevada Supreme Court, in fact, has held that the privilege protects the substance of a lawyer’s consultation with a prospective client.  Pohl v. Ninth Judicial Dist. Court, 2016 WL 383086 (Nev. Jan. 28, 2016), available here.

The Consultation

The Pohl decision makes what one Nevada lawyer did a bit puzzling.  A prospective client met with the lawyer about filing a divorce action and revealed to him that her husband was verbally abusive. More…

Non-Waiver Contract Saves GC from Disclosing Privileged Info to Grand Jury

Though the Fourth Circuit has not decided the issue, most federal courts reject a selective-waiver doctrine, meaning that waiver to one is waiver to all.  But one company under a federal criminal investigation permitted an in-house lawyer to disclose privileged information to U.S. Attorneys after the DOJ agreed to a non-waiver contract.

Did the contract prevent privilege waiver? The Fourth Circuit said yes, and precluded the DOJ from calling the in-house counsel to repeat the previously disclosed privileged information before a federal grand jury.  In re: Grand Jury 16-3817 (16-4) United States of America, 2018 WL 3156935 (CA4 June 27, 2018) (available here). Let’s discuss the nuances of this interesting opinion. More…