The attorney-client privilege is sacrosanct to most attorneys, especially those attorneys who hold in-house positions. The privilege often – and appropriately – is asserted by in-house counsel to protect communications that were conducted with certain individuals while those individuals were employed by the company, regardless of their employment status at the moment.
However, what happens to that protection if the in-house counsel opens new discussions with an individual who no longer is employed by the company? In a holding that has gotten the attention of in-house attorneys nation-wide, one state’s supreme court decided that the attorney-client privilege “does not broadly shield counsel’s postemployment communications with former employees.” Newman v. Highland Sch. Dist., No. 90194-5 (Wash., Oct. 20, 2016). Here’s what happened in that case:
- A high school football player suffered a permanent brain injury at a football game in 2009, one day after he sustained a head injury during football practice;
- Subsequently, the player and his parents sued the school district for negligence;
- Prior to trial, the school district’s attorney interviewed several former coaches, and then appeared and represented those coaches at their depositions;
- Plaintiff’s motion to disqualify the attorney from representing the former coaches at the depositions was denied;
- Plaintiff then sought discovery related to the communications between the school district’s attorney and the coaches during the period after the coaches left employment, but before they were represented by the attorney at their depositions;
- The school district filed a motion for protective order, arguing that the attorney-client privilege protected counsel’s communications with the former coaches;
- The trial court denied the motion, and the school district appealed to the Washington State Supreme Court, which upheld the denial.
The Washington State Supreme Court framed the issue as “whether postemployment communications between former employees and corporate counsel should be treated the same as communications with current employees for purposes of applying the corporate attorney-client privilege,” and then answered that issue by finding that “the privilege does not broadly shield counsel’s postemployment communications with former employees.”
The Supreme Court affirmed the lower court decision and ordered discovery to go forward, allowing the plaintiff’s attorneys to seek information about discussions between the former employees and the school district’s counsel that occurred prior to the deposition.
The Court in this case addressed three stages of communication between the school district’s attorney and the coaches, and applied the attorney-client privilege to two of them:
- There was no dispute about the fact that communications with counsel, if any, conducted during the coaches’ employment would be protected by the privilege;
- Plaintiff did not appeal the trial court’s order denying disqualification of counsel from representing the coaches at the depositions, so communications at and for purposes of the deposition were protected; but
- The Court declined “to expand the privilege to communications outside the employee-employer relationship” in this circumstance.
The decision here – to allow the plaintiff’s counsel in this case to delve into recent discussions between the school district’s attorney and the former coaches – has induced some level of anxiety among in-house counsel. Because the case implicated Washington State’s attorney-client privilege, as set forth in that state’s applicable statutes, one might argue that the holding is limited. However, the Court referenced, as a starting point in its analysis, Upjohn Co. v. United States, 449 U.S. 383 (1981), the leading U.S. Supreme Court case addressing attorney-client privilege, meaning that this holding may well be picked up by other courts.
For now, in-house counsel should be made aware of this decision and should seek to establish, at an early stage in litigation, formal legal representation of any former employee/witnesses who may be viewed as speaking on behalf of the company, unless that representation creates a conflict of interest.