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The attorney-client privilege protects communications between attorneys and clients from compelled disclosure. It applies to any communication that satisfies the following elements: it must be (1) a communication (2) made between privileged persons (3) in confidence (4) for the purpose of obtaining or providing legal assistance for the client. Privileged persons include the client, the attorney(s), and any of their agents that help facilitate attorney-client communications or the legal representation.
The court referred to this case as a classic corporate divorce. The parent company bought another company but, after financials turned sour, the purchased (debtor) company filed for bankruptcy. In bankruptcy, the debtor company subsidiaries sued the parent for all manner of ills relating to the break-up. At issue here was a pre-trial dispute over documents produced by and in communication with attorneys who represented the entire corporate family back when they all got along.
Could the parent assert the attorney-client privilege against its former corporate family members?
The court on review concluded that the district court's factual findings did not support setting aside the parent's privilege. Specifically, the court held that the parent could not be compelled to produce documents under the adverse-litigation exception to the co-client privilege unless it was determined that the parent and the debtors were jointly represented by the same attorneys on a matter of common interest that was the subject-matter of those documents. Finding just that the companies were jointly represented was not enough.