Court Rules Attorney-Client Privilege Ceases To Exist When Corporation Ceases To Exist Without Successor

The LLC May Well Be The Platypus Of Business Organizations What happens to the attorney-client privilege when a corporation dissolves?  Magistrate Judge Sallie Kim recently answered that question in Virtue Global Holdings Ltd. v. Rearden LLC, 2016 U.S. Dist. LEXIS 53076 (N.D. Cal. April 5, 2016): When a corporation ceases to exist, “the corporate powers, rights and

Court May Not Employ Alan Funt Tactics To Assess Attorney-Client Privilege

California, unlike other states, has codified the attorney-client (and other evidentiary) privileges.  Cal. Evid. Code §§ 900 et seq.  In an opinion issued last week, the California Court of Appeal provided a nice summary of how a court must assess attorney-client privilege claims: A court, however, may not review the contents of a communication to determine whether

Are Consultant’s Employees Functionally Equivalent To Client’s Employees?

As a general matter, the attorney-client privilege is waived by disclosing a communication to a third party.  When a corporation hires an investment banker, the corporation’s attorneys will frequently communicate with employees of the investment banker.  Are those communications protected by the attorney-client privilege or do those communications waive the privilege?  U.S. Magistrate Judge George

California Law Revision Commission Mulls Recommending Exception To Mediation Privilege

In This Evidentiary Privilege May Stop At The Border, I noted that Section 1119 of the California Evidence Code establishes a broad mediation privilege: No evidence of anything said or any admission made for the purpose of, in the course of, or pursuant to, a mediation or a mediation consultation is admissible or subject to

This Evidentiary Privilege May Stop At The Border

Unlike other states, California’s rules of evidence are found in statutes, not court rules.  This is not simply a legal curiosity.  The statutory basis of California’s “rules” of evidence have real world implications. The California Evidence Code begins with the underlying premise that disclosure is required. Thus, no person has a privilege unless otherwise provided

SEC Condemns Breach Of Client Confidences While Offering Possible Bounties For Breaches

Yesterday, the Securities and Exchange Commission announced that it had “charged a California-based attorney and his wife with insider trading on confidential information obtained from a corporate client.”  According to the SEC’s complaint, the attorney had tipped material non-public information concerning a client, Spectrum Pharmaceuticals, Inc., to his spouse.  According to the SEC’s complaint, the attorney

Attorney-Client privilege In M&A Transactions

The title of this recent law review article frames the problem well, At the Whim of Your Adversaries: California’s Hazards in Sell-Side Representation and Waiver of Attorney-Client Privilege, 54 Santa Clara L. Rev. 651 (2014).  In this article, the authors, practicing attorneys Mattia V. Murawski and Brian R. Wilson, argue for an amendment to the California Evidence Code

Why Keeping Corporate Lawyers Quiet Is Good For Us All

In a recent post in The New York Times DealBook, Berkeley Law School Professor Steven Davidoff Solomon argues that keeping corporate lawyers silent “can shelter wrongdoing”.  I completely agree that the attorney-client privilege limits society’s access to information.   If access to information is the only societal value to be considered, then the attorney-client privilege should be abolished forthwith.  Other societal

Insurer Claims Attorney-Client Privilege Of Third Parties Prohibits Disclosure To Its Own Attorneys

At first, this case seems somewhat pedestrian – a lawyer sues her erstwhile law firm for employment discrimination.  But then things get complicated.  It turns out that the lawyer was employed by a law firm that was employed by an insurer to represent its insureds.  When the lawyer served a request for production of documents, the insurer

Former Executive Has No Right To Possess A-C Privileged Documents

Suppose that a corporation terminates its president and chief executive officer who then sues for breach of his employment contract.  Does the former executive officer have a right to access and use materials subject to the attorney-client privilege that were created during his tenure with the corporation?  If so, what would be the theory? In