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Troutman Sanders LLP: 'Waive'-ing Goodbye To Privilege Protection

The attorney-client and work product privileges are some of the oldest and most important evidentiary privileges in our legal system. The attorney-client privilege, in particular, is regarded by some as almost "sacred." Given their importance, you would think that these privileges would be closely safeguarded by attorneys and litigants - and, generally, they are. However, safeguarding these privileges is not always an easy task. As recent cases have shown, this is particularly true when electronic discovery is in play.

Rule 502(b) of the Federal Rules of Evidence sets out a five-factor test that is generally considered by courts when determining whether the inadvertent production of documents has resulted in a waiver of privilege. Those factors are: (1) the reasonableness of precautions taken in view of the extent of document production; (2) the number of inadvertent disclosures; (3) the magnitude of the disclosures; (4) any measures taken to mitigate the damage of the disclosures; and (5) the overriding interests of justice.

There is more risk of inadvertent privilege waiver with electronic discovery than with traditional forms of discovery, for a number of reasons. First, electronic discovery often involves more than just an attorney or a law firm. It can also involve contract document reviewers, information technology vendors and computer forensic experts. The recent case of Ceglia v. Zuckerberg [enhanced version available to subscribers] demonstrated how these additional players may cause privilege to be lost. In this case, the plaintiff hired an information technology expert to recover a specific document from a computer at plaintiff's counsel's office. While the expert was supposed to copy and produce just that document to the defendant, he actually produced both that document and the privileged email to which it was attached. Two months later, the plaintiff claimed that the email had been inadvertently produced and requested that it be returned or destroyed. Magistrate Judge Foschio from the Western District of New York ultimately determined that the attorney-client privilege was waived because plaintiff's counsel failed to adequately supervise the technology expert's recovery and production efforts and this amounted to a failure to take reasonable efforts to prevent the disclosure of privileged documents.

In addition to waiver risks resulting from the additional players involved in electronic discovery, the most significant risks are the result of the sheer number of documents involved. A recent case out of the Southern District of Ohio indicates just how tough it can be to control the release of privileged information when dealing with a voluminous amount of electronic documents. In this case, Inhalation Plastics, Inc. v. Medex Cardio-Pulmonary, Inc. [enhanced version], the defendant inadvertently produced 347 pages of privileged emails during the course of a discovery period that involved multiple productions of many thousands of pages of documents. The court found that the privilege had been waived as to these 347 pages of emails. In reaching this decision, the court cited the defendant's lack of specificity as to who conducted the review of these emails and how, the lack of a privilege log, and the fact that 4.6% of a certain production was inadvertently produced.

In this day and age, if you are involved in litigation, you will, most likely, need to undertake some electronic discovery. The question, therefore, is not "What can I do to avoid electronic discovery?" but rather "What can I do to better protect my attorney-client and work product privileges during the course of engaging in necessary electronic discovery?"

The first thing you can, and should, do is get a "clawback" order from the court. Clawback orders, available pursuant to Rule 502(d) of the Federal Rules of Evidence, allow a producing party to retrieve (or claw back) any privileged or protected documents that were produced to the other party without the waiver of any privileges applicable to the produced documents. These orders can be entered sua sponte, even over the objection of one of the parties.

While clawback orders can go a long way toward mitigating against some of the risks associated with electronic discovery, they are by no means failproof. For example, in some instances courts are examining the reasonableness of the parties' discovery activities even when there is a clawback order in place. As such, in addition to seeking a clawback order, you should take all steps necessary to guarantee that no privileged documents are produced in the first place. This includes developing an appropriate review plan, closely monitoring all reviewers, vendors and experts working with electronic documents, leveraging technology, and documenting steps taken to prove the reasonableness of your efforts.

For more information, please contact Erin Graham or Alison Grounds.

About Troutman Sanders

Troutman Sanders is an international law firm with offices in North America, Europe and Asia. Founded in 1897, the firm's heritage of extensive experience, exceptional responsiveness and an unwavering commitment to service has garnered strong, long-standing relationships with clients across the globe. These clients range from multinational corporations to individual entrepreneurs, federal and state agencies to foreign governments, and non-profit organizations to businesses representing virtually every sector and industry.

Troutman Sanders lawyers provide counsel and advice in practically every aspect of civil and commercial law related to the firm's core practice areas: Corporate, Finance, Litigation, Public Law and Real Estate. With more than 50 practice groups focused on specific aspects of these areas, the firm is defined by its considerable knowledge base and proactive approach to addressing legal and business challenges.

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