All but a handful of courts find that companies disclosing privileged communications or protected work product to the government waive both of those protections. Courts properly analyzing waiver rules also recognize that disclosing historical facts does not cause a waiver – because historical facts are not privileged.
In two related cases, Judge Francis of the Southern District of New York dealt with the intersection of these basic principles. In In re Weatherford International Securities Litigation, No. 11 Civ. 1646 (LAK) (JCF), 2013 U.S. Dist. LEXIS 170559 (S.D.N.Y. Nov. 5, 2013), Weatherford retained Latham & Watkins and Davis Polk to conduct two separate corporate investigations into material weaknesses in the company’s internal controls over financial reporting. The court acknowledged that both investigations deserved work product protection. However, the court also found that the company waived its privilege and fact (but not opinion) work product protection by disclosing information about the investigations to the SEC. In defining the scope of the resulting waiver, the court (1) rejected plaintiffs’ argument that the waiver extended to “all materials relevant” to the investigations; (2) found that the waiver covered any material actually given to the SEC, and any oral representations company lawyers made to the SEC; and (3) held that the waiver also extended to any “underlying factual material explicitly referenced” in such material or representations. Id. at *28, *27.
Perhaps not surprisingly, the parties soon disagreed about the company’s interpretation of the waiver’s scope – which resulted in another opinion one month later.
In In re Weatherford International Securities Litigation, No. 11 Civ. 1646 (LAK) (JCF), 2013 U.S. Dist. LEXIS 176278, at *7 (S.D.N.Y. Dec. 16, 2013), the court first focused on “interview materials” Davis Polk lawyers used to create four PowerPoint presentations to the SEC. The court held that the company did not have to produce any interview materials “unless those specific materials are explicitly identified, cited, or quoted in information disclosed to the SEC.” Id. at *10. Interestingly, the court rejected plaintiffs’ argument that the company crossed that line “where the presentations assert that a particular witness made a statement.” Id. at *7. The court acknowledged that such a representation to the SEC obviously implied “that an interview took place” and also provided “a strong inference that it was memorialized in some way” – but ultimately concluded that “plaintiffs have not shown that those memorializations were, themselves, explicitly referenced in communications with the SEC.” Id. at *7-8.
The court then turned to the company’s redactions in the interview summaries produced in response to the earlier ruling by addressing the plaintiffs’ complaint that the company had not fully produced those witness interview summaries that were “explicitly identified, cited, or quoted in information disclosed to the SEC.” The company explained that it had produced “only the ‘portions of summaries . . . that were . . . read or conveyed in substantial part to the SEC,'” and redacted the rest. Id. at *12 (internal citation omitted). Criticizing that as a “crabbed view of their discovery obligations,” the court ordered the company to produce all factual portions of any such interview summaries — redacting “only material that reflects an attorney’s ‘explicit mental impressions, conclusions, opinions or legal theories.'” Id. at *12-13 (citation omitted). In other words, the company had to produce all non-opinion portions of any witness interview summaries the company had quoted to the SEC.
It can be very difficult to reconcile two basic principles: (1) disclosure of privileged communications or work product to the government generally waives those protections; and (2) disclosing historical facts does not waive either protection. As explained in these opinions by widely‑respected S.D.N.Y. Judge Francis, companies hoping to avoid a broad waiver when making disclosures to the government should limit their presentations to historical facts – without explicitly referencing, identifying, citing, or quoting any underlying material or witness interviews.