Thursday, August 4, 2016

On Practically Protecting Privilege In-House

Following yesterday's update comes analysis and advice via partners from Dentons: "Exercising Attorney-Client Privilege Over In-House Counsel Communications" –
  • While the Stock decision reflects a growing trend among state courts in rejecting the fiduciary exception to the attorney-client privilege and upholding the privilege for communications between firm attorneys and in-house counsel under certain circumstances, many jurisdictions have yet to jump on the bandwagon. In those jurisdictions, attorneys must tread carefully or risk losing all benefits of the attorney-client relationship. Moreover, even in the jurisdictions where the privilege exists, the cases suggest that certain steps should be taken to protect the privilege. Thus, law firms and their attorneys may wish to consider the following recommendations."
  • "Appoint In-House Counsel. Regardless of the size of the law firm or type of practice, formally designating an attorney (or team of attorneys) to serve as in-house counsel benefits the firm and its clients. Maintaining confidentiality and avoiding conflicts of interest with clients are chief among the reasons for appointing in-house counsel."
  • "Treat In-House Counsel as Counsel to the Firm in Form and Substance. Ensuring the legitimacy and effectiveness of in-house counsel requires more than just the provision of a title. Instead, the position should be assigned responsibilities, including, but not limited to, the investigation and analysis of matters that might involve attorney exposure... Additionally, when discussing claims or rendering advice on specific matters involving firm clients, those clients should not be billed for any time devoted to consulting on such matters."
  • "Segregate Client Files and In-House Counsel Files. Because the purpose of the communication is to seek legal advice on behalf of the firm, files maintained by in-house counsel should be segregated from those maintained by attorneys during the normal course of client representations. Too often, internal communications discussing ethics inquiries or potential conflicts are maintained with other documents and materials for the case under which the issue arose."
  • "When that occurs, disclosure of those communications may be contested. The former client may insist that those documents corroborate claims of ethical violations or other attorney misconduct. Keeping communications with in-house counsel separate helps prevent their disclosure, even in jurisdictions where the client “owns” the client file. To protect communications, in-house counsel should store emails and memoranda of conversations in files created for the purpose of advising the attorney or firm, while the attorney should keep them out of client files."

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