August 2011 | Earn one hour of MCLE Credit in Legal Ethics
You saw what?
Inadvertent disclosure and the attorney-client privilege
Your client is being deposed by opposing counsel. In the middle of the questioning, he begins to ask questions based on confidential information that, to your knowledge, your client has only shared with you. You object on privilege grounds and call for a break — at which time you discover your opponent is in possession of a cache of private correspondence between you and your client. The other lawyer explains that you accidentally provided it in discovery and that because he inadvertently received it through no fault of his own, he used it to prepare his case. Under relevant case law and ethics rules, what remedies are open to you?
Inadvertent disclosure is an important issue in modern litigation due to the increasing speed with which lawyers are able to prepare their cases through a variety of electronic options. With increased reliance on email and other quick methods of transmitting information, both haste and human error create plenty of opportunities for inadvertent disclosure. Once one side inadvertently receives valuable information from their opponent, what is their ethical responsibility? Do they have to notify their opponent that they are in possession of the information? Can they read it? Do they have to return the information, and if so, can they copy it first? And what remedy is available if they use what they have seen to revamp their litigation strategy?
This article will tackle these difficult issues by examining the relevant law and ethics rules that apply. It will discuss the California Rules of Professional Conduct, the ABA Model Rules of Professional Conduct and applicable case law.
Client confidentiality: California rules
The conduct of California lawyers is governed by California Business and Professions Code § 6068, which enumerates the duties of an attorney. Regarding disclosure of confidential information, BP 6068(e)(1) states that one of the duties of an attorney is “[t]o maintain inviolate the confidence, and at every peril to himself or herself to preserve the secrets, of his or her client.” “Confidential communication between client and lawyer” is defined in California Evidence Code § 952 as “information transmitted between a client and his or her lawyer in the course of that relationship and in confidence by a means which, so far as the client is aware, discloses the information to no third persons other than those who are present to further the interest of the client in the consultation or those to whom disclosure is reasonably necessary for the transmission of the information or the accomplishment of the purpose for which the lawyer is consulted, and includes a legal opinion formed and the advice given by the lawyer in the course of that relationship.” The client is the holder of the privilege per § 953, and subject to several regulations enumerated in § 954, has a privilege to refuse to disclose attorney-client confidential communications.
There is no Inadvertent Disclosure rule found in the California Rule of Professional Conduct. When the California rules are silent on a particular issue, we look to the ABA Model Rules for ethical guidance, although ABA rules and opinions are not binding authority in California. Regarding ABA formal opinions, case law holds that while an ABA formal opinion “does not establish an obligatory standard of conduct imposed on California lawyers,” the ABA Model Rules may be considered as a “collateral source” where there is no direct ethical authority in California. (State Compensation Insurance Fund v. WPS Inc. (State Fund) (1999) 70 Cal.App.4th644, 656.) Because California does not currently have a specific rule on point regarding prospective clients, we look to the ABA.
While the inadvertent disclosure issue is discussed in Model Rule 4.4 and there are several ABA ethics opinions on point, we still do not get much guidance beyond the duty to “notify” the erring party.
ABA Rule 4.4(b), Respect for Rights of Third Persons
Model Rule 4.4 subsection (b) provides that “a lawyer who receives a document relating to the representation of the lawyer’s client and knows or reasonably should know that the document was inadvertently sent shall promptly notify the sender.” Comment  updates the scope of this rule by specifying that a “document” for purposes of this rule includes electronic communication such as email that can be read or made into readable form.
But the question remains, what is a lawyer to do beyond merely notifying the sender? Comment  explains that the point of notifying the sender is to allow them to take protective measures. The comment declines, however, to opine on whether such production is a waiver of the privileged status of the document, and whether the lawyer is required to return the original document. In fact, Comment  states that this is a decision reserved to the lawyers’ professional judgment. Accordingly, Comment  references Model Rule 1.2, Scope of Representation and Allocation of Authority Between Client and Lawyer, and Rule 1.4, Communication.
Other California ethical rules implicated by inadvertent disclosure
When a lawyer stumbles upon a private document belonging to the other side, do they need to tell their client? What if their conscience gets the better of them and they are planning on returning the document unread? Should they tell their client and run the risk of the client strenuously objecting? Can the client insist the lawyer not return the document?
California Rule of Professional Conduct 3-500 requires a lawyer to “keep a client reasonably informed about significant developments relating to the employment or representation, including promptly complying with reasonable requests for information and copies of significant documents when necessary to keep the client so informed.” Certainly when a lawyer reads a document inadvertently produced by the other side that is helpful to their case or causes him or her to rethink litigation strategy, they may consider that a significant development — although it will depend on the facts of the case. This may be a particularly important issue under circumstances that may result in disqualification. A different result, however, may result when they simply receive a document, and although the label suggests it might contain some juicy information helpful to the case, the lawyer decides not to read it.
Regarding the lawyer who inadvertently disclosed the document, other rules might apply. Whether he accidentally hit “reply to all” instead of just “reply,” selected the wrong automatic email address, forgot to hang up the phone after leaving a message or physically left an important document in court or a deposition room, a lawyer’s negligence may implicate ethical rules regarding competence. (For a similar fact pattern see Jasmine Networks v. Marvell Semiconductor Inc. (2004) 117 Cal.App.4th 794 [Not Citable — Superseded by Grant of Review]) California Rule of Professional conduct 3-110, Failing to Act Competently, states that a lawyer “shall not intentionally, recklessly or repeatedly fail to perform legal services with competence.” “Competence” is defined as including “diligence.”
If the inadvertently disclosed document is something the receiving attorney should have revealed he had come into possession of, he may run afoul of the various duties of candor, all of which deal with actions involving dishonesty. California Rule of Professional Conduct Rule 5-220, Suppression of Evidence, states that “a member shall not suppress any evidence that the member or the member’s client has a legal obligation to reveal or to produce.” Obviously this rule is implicated when a lawyer inadvertently receives information that he is legally bound to reveal or produce. A lawyer’s belief to the contrary may not carry the day if he is wrong.
California Business and Professions Code § 6068, in outlining the duties as an attorney, states in subsection (d) that it is the duty of an attorney “to employ, for the purpose of maintaining the causes confided to him or her those means only as are consistent with truth, and never to seek to mislead the judge or any judicial officer by an artifice or false statement of fact or law.” Lest anyone take a violation of an attorney’s duties lightly, California Business and Professions Code § 6103 states that the penalty for willful violations of among other things, the duties as an attorney, constitutes causes for disbarment or suspension.
Section 6106, which discusses actions unfit for an attorney that may result in discipline, states in pertinent part that “the commission of any act involving moral turpitude, dishonesty or corruption, whether the act is committed in the course of his relations as an attorney or otherwise, and whether the act is a felony or misdemeanor or not, constitutes a cause for disbarment or suspension.”
California case law on inadvertent disclosure and the attorney-client privilege
A critical issue that frequently comes up in connection with inadvertent disclosure is whether the attorney can make use of the information he inadvertently received. If a lawyer reads confidential information inadvertently produced by the other side that changes his or her strategy or approach to the case, may they change gears based on what they have read? In California, we now have some guidance on this issue.
Inadvertent disclosure involves the competing interests of the duty of loyalty and diligent representation of a client against the duty of fairness and duty to maintain an even playing field.
In Rico v. Mitsubishi Motors Corp. (2007) 42 Cal.4th 807, the court considered what actions are ethically required of a lawyer who inadvertently receives privileged documents. The court concluded that according to the authority of State Compensation Insurance Fund v. WPS Inc. ((1999) 70 Cal.App.4th 644 (State Fund)), the attorney may only read as much as is necessary in order to determine the documents are privileged. Once that is determined, the attorney must notify opposing counsel immediately and make an effort to resolve the situation.
In Rico, lawyers for Mitsubishi held a litigation strategy session at which one of the participants took notes about what was discussed at the meeting. Id. at 1.One of Mitsubishi’s lawyers, Yukevich, printed out only one copy of the notes, which he kept to himself in order to help him defend the case. The notes were not labeled as either “work product” or “confidential.” Id. Nonetheless, his opponent ended up coming into possession of the notes from the strategy session, and the court ultimately held his acquisition to be inadvertent. Id.
After Mitsubishi’s opposing counsel made valuable use of the document — which he knew Yukevich had not intended to produce, shared it with his experts and co-counsel, and used it in the deposition of a defense expert, (Id.) defendants moved to disqualify plaintiffs’ lawyers on grounds that they unethically utilized Yukevich’s work product resulting in irreversible prejudice to the defendants. Id. The trial court held the notes were privileged work product and that Yukevich’s opposing counsel had acted unethically in his use of the notes. Id. at 3. Consequently, the court disqualified plaintiffs’ attorneys and experts.Id.
The Rico court adopted the State Fund standard, which was intended to be applied prospectively: “When a lawyer who receives materials that obviously appear to be subject to an attorney-client privilege or otherwise clearly appear to be confidential and privileged and where it is reasonably apparent that the materials were provided or made available through inadvertence, the lawyer receiving such materials should refrain from examining the materials any more than is essential to ascertain if the materials are privileged, and shall immediately notify the sender that he or she possesses material that appears to be privileged. The parties may then proceed to resolve the situation by agreement or may resort to the court for guidance with the benefit of protective orders and other judicial intervention as may be justified.”Id. at 6 (citing State Fund, supra, 70 Cal.App.4th at 656-657).
The court further held disqualification of plaintiffs’ legal team to be proper due to the irreversible prejudice caused by opposing counsel’s unethical use of the notes. Id. at 7.
California has recently received more guidance in the area of attorney-client privilege and inadvertent disclosure in the recent case of Clark v. Superior Court (June 2, 2011) 196 Cal.App.4th37; 125 Cal.Rptr.3d 361 [not yet final]. Petitioner Clark sued his former employer VeriSign, after his position as VeriSign’s chief administrative officer was eliminated. (Id. at 365) In connection with the litigation, Clark gave his attorneys numerous documents that VeriSign alleged were protected by the attorney-client privilege. (Id. at 364-65) VeriSign demanded the documents be returned, citing both Rico v. Mitsubishi Motors Corp. (2007) 42 Cal.4th 807 and State Comp. Ins. Fund v. WPS Inc. (1999) 70 Cal.App.4th 644. (Id. at 365) The trial court granted VeriSign’s motion to disqualify Clark’s lawyers as well as a motion for other ancillary relief on the basis of its finding that Clark’s lawyers received documents that contained obvious indicia of privilege and that they had a duty not to review them any more than was reasonably necessary to determine their privileged nature, and then to notify VeriSign. (Id., at 367)
The court further found the actions of Clark’s attorneys upon receiving the privileged documents to be in violation of Rico and State Fund because their review of the documents exceeded the amount of review that should have been necessary to determine that the documents were privileged, and in addition, there was also some evidence that Clark’s attorneys affirmatively used some of the information to advance Clark’s case. (Id. at 373-74) Under the circumstances, the court found that the remedy of disqualification was appropriate. (Id. at 374-75)
Inadvertent disclosure involves balancing a lawyer’s duty of loyalty to his or her client against the ethical duty to respect the attorney-client privilege. A working knowledge of the rules and principles discussed will permit attorneys faced with this dilemma to evaluate their options in light of applicable case law and rules of professional conduct, in order to make an ethical decision.
*This article does not constitute legal advice. Please shepardize all case law before using.
ABOUT THE AUTHOR:
Wendy L. Patrick is a San Diego County Deputy District Attorney in the Sex Crimes and Stalking Division. Patrick has been a chair of the San Diego County Bar Association Legal Ethics Committee for more than five years and is the incoming chair of the California State Bar Committee on Professional Responsibility and Conduct (COPRAC). She can be reached at firstname.lastname@example.org or at 619-531-3260.
This self-study activity has been approved for Minimum Continuing Legal Education credit by the State Bar of California in the amount of one hour of legal ethics.
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