We often hear of an employee downloading trade secrets and other proprietary information when he leaves a company, but what happens when the employee downloads privileged emails between himself and in-house counsel? Can the pilfering employee keep his communications even though it is the company’s privilege? Should the court disqualify the employee’s counsel for reading and not returning the privileged emails? The court’s opinion in Sanchez v. Maquet Getinge Group, 2018 WL 2324679 (N.J. Super. Ct. App. Div. May 23, 2018), provides lessons on these issues. You may read it here, and I discuss it below.
Oscar Sanchez worked as a compliance officer (yes, compliance officer) for Maquet, a pharmaceutical company that designs, manufactures, and distributes medical devices. Sanchez received a disciplinary warning, and then downloaded two Maquet executives’ hard drives and a “binder full of emails” that included emails between him and Maquet’s in-house lawyer regarding FDA compliance issues.
Sanchez took the privileged emails even though he signed a “Confidential Information, Invention Assignment, and Non-Compete Agreement” with Maquet prohibiting him from disclosing confidential information and requiring him to return company documents upon termination. Maquet learned of Sanchez’s possession of its privileged communications when he produced them in discovery, and immediately demanded their return.
Privilege is Threshold Issue
Sanchez first argued that the privilege did not apply because the in-house lawyer was only copied on emails or did not respond to the emails and, consequently, did not provide legal advice. The appellate court upheld the trial court’s privilege finding, noting that Sanchez labeled the emails “ATTORNEY CLIENT PRIVILEGE.” Looks like an easy call there. More…
We’ve heard this mantra from many judges: simply copying an in-house lawyer on an email does not render the email privileged. Need proof? Read these cases: EEOC v. BDO USA, LLP, 2017 WL 5494237 (CA5 Nov. 16, 2017); Andritz Sprout-Bauer, Inc. v. Beazer East, Inc., 174 FRD 609, 633 (M.D. Pa. 1997); United States v. Chevron Texaco Corp., 241 F. Supp. 2d 1065, 1076 (N.D. Cal. 2002).
But one case reveals that this truism is not always, well, true. In Morgan v. Butler, 85 N.E.3d 1188 (Ohio Ct. App. 2017), available here, the court ruled that the attorney–client privilege protected three emails sent from an Ohio EPA supervisor to non-lawyer EPA employees with copies to EPA in-house lawyers. And the story of how the EPA achieved this privilege victory is instructive for the rest of us. More…
The USDC for the ED Louisiana issued a short but instructive privilege opinion for in-house lawyers. The court found the in-house counsel privilege “more difficult” to apply, ruled that an executive’s cc’ing in-house counsel is insufficient, imposed a “primary purpose” standard, and generally rejected the privilege because there was “no indication” that the employee emailing the in-house lawyer was seeking legal advice. Texas Brine Co. v. Dow Chemical Co., 2017 WL 5625812 (ED La. Nov. 21, 2017). You may read the opinion here.
Dow Chemical challenged the privileged nature of several emails involving Texas Brine’s in-house lawyers, and the court recognized the difficulty in assessing in-house lawyers’ privilege assertions. The court found it “more difficult” to define the privilege’s scope because in-house counsel “serve multiple roles,” including non-legal ones, and have an “increased level of participation in the day-to-day operations of the corporation.”
The Primary Purpose or A Primary Purpose?
Because of a perceived increase in corporate counsel’s business roles, the court required the Texas Brine lawyers to prove that “the primary purpose” of the emails was to secure legal advice. The court explained this “test” as whether the in-house lawyer participated in the communication “primarily for the purpose of rendering legal advice.” Merely identifying a legal issue in the email is insufficient—the “lawyer’s role as a lawyer must be primary to her participation.” More…