[Steven] Welcome to Confidentiality and the Privilege. This will be an interesting program, I think, talking about some very good aspects of what I call the world of ethics. What I'm gonna be doing today is looking at it from a different perspective than you may be used to. I'm gonna look at confidentiality and the work product privilege in the sense of what are some of the common misunderstandings and misapplications of the rule. I think that gives an interesting view to everyone that's looking at the topic and trying to figure out just exactly what can I do and what can't I do. I strongly encourage anyone that has questions either during the presentation, after the presentation, just contact me and I'll be more than happy to expand on the topics. The material is far more extensive than I'll be able to cover in the next hour, but it will be, I think, helpful. Again, I'm Attorney Steve Sorenson. I'm a practicing attorney in the state of Wisconsin. I've been part of, well, I was President of the State Bar of Wisconsin, I was President of the National Conference and Bar President, so I've been active throughout the United States in the area of ethics, especially, giving programs consistently on these topics of confidentiality and privilege. So let's get into it, let's talk about it. The first thing that we need to do is we need to take a look and understand where the duty comes from. The duty of confidentiality comes from our Model Rules, and we'll be talking about the ABA Model Rules. Every state has their own rules. But I think if you look at the ABA rules and you look at them from the perspective of what do they say, you'll understand that the duty of confidentiality is really one that is clearly defined in the rules, but in interpretation, sometimes we leave it to other sources. I also strongly recommend that when you take a look at the rule, look at the comments to this rule, because this rule will tell you a lot when you look at it. And now what does the rule govern? It governs disclosure of information related to the representation that the attorney is making. The rule specifically talks about the lawyer in a position of representing a client. Remember that the rule, through different aspects of the Model Rules, not only covers you as an individual attorney but also your firm. So confidentiality doesn't start and stop with the attorney. It doesn't start and stop with the attorney's staff. It starts and stops with the entire office and all the people that are working there. So it's important that you do take a look at that and the furtherance of that concept. We'll also be talking about that the rule doesn't deal just with current clients, it also deals with prospective clients and it deals with past clients. Now, the rule itself clearly states that a lawyer has a duty with respect to the information to keep that information confidential so that it does not disadvantage a client or a former client. It's essential that the lawyer understands that confidentiality includes anything that is disclosed to the lawyer during the period of time that the lawyer's representing the attorney, whether it comes from the actual client, comes from an associate of the client, comes through discovery. All this material, the lawyer has to look at and say, "This is client information," and has to look at the information and ask that question, could the release of this information or the discussion this information have a negative impact on the client? And the answer, if it is at all yes, is that that must remain confidential. Now, we'll talk about exceptions to the rule, but I think you really have to understand that when we talk about the rule, it covers all the information that's being delivered. The authorized disclosures is the first exception, and this one's easy if one looks at if a client tells a lawyer to disclose something. And for example, oftentimes in negotiations and strategies, the client will want the lawyer to disclose. The client will tell the attorney to disclose to a co-counsel if there's more than one defendant, for example, in a criminal case. Or if it's sophisticated business litigation and there's several parties, the exchange of information between the respective clients may be excellent and may be very appropriate. And you have to look at that rule and understand that those are authorized disclosures, but for heaven's sakes, get them in writing. Now, some states, my own included, require that any release of confidentiality be in writing. I think it's a good practice, even if it's just a practice of repeating what a client told you in a email or a letter back to the client that says, "Was great talking to you today. And my understanding is you would like me to disclose as far as the negotiations this information you've given me with regard to your financials for the last three years." Those are the type of things that you need to look at. Now, when I talk about exceptions to the rule too, and this is where I want to get to some of the misunderstandings that exist out there, is you have to understand that there are exceptions. And one of the exceptions is that if you believe the client is about to commit great bodily harm to another, you have a right to disclose that. But that rule does not extend to if your client comes in and says, "You know, I just went out and killed five people," and it's not likely that he's going to, or she's going to go kill the sixth, then there's no authorization to disclose. And it's not one of those unique situations. It's only if something is coming in the future that the lawyer believes and has substantial reason to believe there will be substantial injury unless the lawyer discloses in the future. Another misunderstanding with regard to the rule affects the belief that if you heard it from some other person in the organization, then it's not protected information. And that's not true. When you're representing a business, you're representing a club, you're representing any group that may have more components than just one person, if you hear it from their accountant, if you hear it from their counselor, whatever it may be, that's still confidential information that is not under the rule as far as an exception. It's not a unique situation. There is a unique situation if, again, the client has authorized it under disclosure. Another area that is unique that people need to look at or talk about deals with the concept of the whole duty to the material that is available in the public. Simply because something is in the public, that doesn't mean that the client has authorized you to disclose it. You have to remember that as an attorney or as a member of an attorney's staff, when you say something that holds a lot more credence than when it's put in a newspaper or it's talked about on TV or something of that nature, that doesn't give you the right. Where you do have the right is if you're in a case situation where you're withdrawing from representation. But if you're withdrawing from representation let's say for non-payment of fees, be very, very careful as to what you've disclosed because again, unless there's some safeguard on that confidential material and hearing to withdraw, the rule is pretty clear that you cannot disclose. I once withdrew from a case and the judge was peppering me with questions, and I said, "Your honor, you have to understand I can't disclose confidentiality. The reason I'm asking to withdraw is because my client is not cooperating with me and is not paying my bills, and it really has nothing to do with what the case is all about." And so you need to keep that in mind when you're looking at some of the exceptions to the rule and the authorizations. Now, if you're at a disciplinary hearing and the client's brought a complaint against you, the client is waiving their confidentiality in most cases, and the arbitrator or the enforcement organization should be telling the client that, that in the fact that they're going to accuse you of doing something, you have a right to disclose confidentiality to show that you have not violated the rule. Those are the unique situations that, again, the materials that we have available, they'll give you a lot more detail on that. And it could be a program into itself of just talking about some of the exceptions. What I'd like to look at then is the next, which is understanding the duty. Now, we understood the duty from the perspective of the rules of professional responsibility, but I always like to take a look at it from the Restatement of Torts. And this is an area... Or excuse me, the Restatement of Law of Governing Lawyers. This is an area which is really helpful for anybody that wants to understand confidentiality, especially in the courtroom situation. Understand because the restatement takes the case law and puts it into a succinct message to each of us as to what is the rule on confidentiality. There are three components to the rule. The first duty is what we call a negative duty. It's to not use or to disclose... Oops, excuse me. It's to not use or disclose. It means, in other words, keep your mouth shut. The second is the positive, and that's the safeguard to make sure that other people in your office, other people that you come in contact with, other co-counsel, anyone else that you've been authorized to disclose or work with, and that includes your client. Oftentimes, it's up to you as a lawyer to tell the client to be sure to make sure that there's not a release of this confidential information. The third area, and this is the one that often gets overlooked, is that under the restatement, the third duty is to protect the client against the lawyer's use or disclosure of confidential information. And oftentimes I find that this is one where people really don't look too often at because they don't think of the fact that they get information that they cannot use for themselves. Developments, client comes in and talks about a project they were looking at just didn't work because they couldn't get the right kind of financing. And you say to yourself, "Yeah, but I can get the right kind of financing. In fact, I know another client that could do that." Well, you have to remember the information you just received from the client is confidential. You can't take that information to profit yourself or to profit another client unless your client has given you permission. And that's really true, especially if you have the situation where it's duty to a former client. You may have learned something in a former relationship that's going to help you in a new relationship, but it was confidential information you received from the client. You still have a duty to keep that confidential, and that's important to recognize and the restatement makes that very, very clear. So it's important that you recognize that. There's what we call the two factor test, when we try under the restatement to look at whether or not there has been a breach. And, you know, we don't like to talk about breaches, but I think it's really important to do this because there is an implication. Sometimes we do release confidential information, sometimes we don't do it on purpose, but the factors that we look at is one, what's the risk of harm to the client, and what's the client instruction? And this is extremely important. The risk of harm. This is the question you ask yourself. You ask yourself when you look at the concept of the risk of harm, will the use or disclosure of client confidential information create a reasonable prospect that doing so will adversely affect the material interest of the client or prospective client? This is one of those rules that uses rules within rules to disclose what the rule might be. Now, I'm gonna break this down. First of all, will the use, in other words, taking the information and using it, using it to invest in something, using it to assist another client, that's the use. Disclosure means just to release the information, tell somebody, allow a secretary or legal assistant or paralegal to discuss it with someone. That's the disclosure of the information. Will either of these create a reasonable prospect? Is it likely that if you tell a banker about this interesting case you've just had, you don't tell the person's name, you don't tell any of the facts, but you talk about how they designed these new, let me think of one that might be appropriate, these new mini houses or these little, little houses, and how it's going to be just a real new market area and how it could fit over in this other project, you're not disclosing anything about the client, you're not disclosing anything about where that client is gonna build her project, but you're disclosing a concept and you're using that concept to assist another client or a prospective client of yours that could materially or adversely affect your first client from which you receive the information, because maybe the market will get saturated, maybe he was planning on, or she was planning on, selling that concept to the same banker or the same investment group. You don't know those things, but you take that risk. And that's why we refer to this as the risk of harm because it forces you into the necessity of expanding your horizon looking at this. I mean, you need to consider the factors, the circumstances of the disclosure, the secretive nature of the information. Is this something that is in the public knowledge? It is something that you know about. The materiality, and I use my example again of the tiny houses, whatever you wanna call them. That's a new concept, and that new concept, in my world, I practice a lot in the real estate world, there's some unique aspects that some of my clients have come up with that other of my clients would love to have those aspects explained to them. You can't do that. The other thing you have to worry about is behavior. You know, we talk about risk. You always have the bragger client, the one that wants to talk how successful, how much they've done, and they think they're hiding it. They'll go on their Facebook page or they'll go on a tweet or a blog and they'll describe the facts and circumstances, but they'll describe it in such an nature that the people that are going to get that information can put two and two together from the public media, from other sources, and find out that what's really happening here, 'cause even though the attorney is trying to keep it down or keep it protected or keep it confidential, they're not really effectively doing that. Look at the position the person you're talking to. I mean, it's one thing to talk to your administrative assistant, it's another thing to talk to another attorney in the firm, and it's another thing to talk to a banker, it's another thing to talk to a real estate mogul. These are different positions you have to look at. Also, what about mitigation? Sometimes we do need to consider mitigation when we do risk assessment, and that's important too, that we look at how we can keep those risks down. Finally, keeping the client informed. I don't know how I can put this any better, but if you can please keep your client informed as to where you're going, what you're doing, you know, those are the factors you want to look at. So what I did for you is on the this slide, I've listed all these factors, and these are the factors you really want to take a look at. The circumstances, the secretive nature of the information, the materiality, the behavior, the position, the possibility of mitigation, the actual , the acquisition of your client, and the adverse affect. And I use these, these are the ones, the factors that I use, when I'm working with an attorney who has disclosed, who has made the mistake, or a staff that has. We look at these factors and we try to say, "What's the harm that we may have caused?" 'Cause remember, if you go back to the two factor test, you're looking at not only the harm but also you're going to look at what the consequences are. I mean, minor harm can be dealt with, can be mitigated. Major harm, you probably need to think about doing something else. So let's continue in our short time here today. What else do we look at? Well, we look at the concept of use versus disclosure. And I put this together because I wanted you to think about it. Remember, and I've already discussed this a little bit, and we won't waste a lot of time on it, but understand that there's a need to distinguish between the two for potential violations that exist. It's oftentimes easier to see the confidentiality risk when you disclose. It's not so easy when you use risk assessment based upon use. A lot of us will use the information to gain advantages, and some of that can be of the nature that you're not really using the confidential client information, but you're using information you picked up on the representation. That can be a fine line. One of the things that I've advocated for attorneys that will call me up and I serve as in-house counsel is I'll go through this and say, "Okay, have you written it down? Have you looked at that statement or the consequence? Is it something that you can say, 'Well, this has no adverse effect for my client'? And then have you picked up the phone and talked to the client?" 'Cause that's really an important task we'll talk about when we talk about trying to mitigate the damages. The other aspect of the two part test is the client's instructions. What has the client told you to do? It's easy when it's in writing. And I do this with my engagement letters. If I have information that I think is valuable for me to disclose, I always put in the information, or, excuse, me in the engagement letter. I always want the client to know what I'm gonna disclose. If I'm working co-counsel, I always put in writing, "I will be discussing this with co-counsel." Don't ever let the client rely upon an oral representation because if things go bad, oral representations have a tendency to morph into something that was really never there. So writing is good. Now, is it always there? Of course it's not. Is the disclosure permitted if you believe? The answer is no. You can't use the defense of, "Well, but I was doing it for his benefit or her benefit." No, that doesn't work under the rules. The rules are rules and we as lawyers know that. I mean, this is like criminal law. So this is the rule. There's no happy medium. It says that if you don't have the client's permission, you cannot disclose. Watch out for third party instructions. Again, if the client uses a third party, in other words you get a letter from the accountant and the accountant says, "Client Joe told me that I should provide you with these financials which you are to share with," my best advice on this is to have that third party instruction confirmed by your client in writing. Now, sometimes that's awkward, but in this day and age of emails and text messages, it's not really that difficult and it's a good idea. And again, every time the disclosure is required, you must inform the client. I mean, even if the client's saying, "I'm gonna go out and kill somebody this afternoon," you have to tell the client, "I'm under a duty to inform law enforcement." Now, your own safety may require you to wait a little bit and send that in writing rather than when he's sitting there in the room with his gun. But the bottom line is you do have a duty to disclose, and that duty has to come before the disclosure of the information to third parties. Even if you're going into a lawsuit situation to defend yourself, you have a duty to say to the client, "You've filed a complaint against me. Please realize that in order to defend this complaint, I'm going to have to release this confidential information because it's gonna show to the administrative agency that I really didn't violate the rules. But I can't do that without disclosing this information." You're not using it as a leverage against the client filing the complaint or getting the client to withdraw the complaint, it must be a legitimate need to release that presupposes your ability to disclose and to inform the client, the predisposition is to disclose to the client that you're going to disclose. Don't use it as kind of, you know, leverage to try to get them to get rid of it. What is permissible disclosure? That's always out there, and I've talked a little bit about this, and we'll just talk quickly about this one. Obviously you can talk to your staff, you can talk to any other attorney that's assisting in your firm. If it's outside of your firm, make sure you have permission. You can disclose to independent contractors that have been retained by the client to assist with the case. So if you retain a specialist to go through and do a appraisal or to do an analysis of the numbers or of the accident scene or whatever, make sure the client has given you permission to release the information, or that the client has retained and the retention is not between your office and the expert, but between the client and the expert. And then engagement should have language that says that the independent contractor, you can disclose information that may otherwise be confidential. That should be part of the engagement. To facilitate your practice, is it permissible to disclose? The answer is yes. This is what we're talking about when you want to disclose confidential information in order to remove yourself from a case and the court requires it and removal requires it because let's say you found a, I'll give you a classic example, you found a conflict within the firm. You didn't know it existed, but you found it. You have to go to your client and say, you know, "I'm going to have to disclose to you that I have a conflict because I represent someone else and you didn't know that before, and our representation of that someone else is really a confidential matter. But I have to tell you because that's the reason I'm backing out of this case. I have to, you know, discontinue." The other place that we see it a lot is lateral transfers, which of course is very popular in the profession right now. So I'm transferring from firm A to firm B, I have to disclose who my clients are, I have to disclose the nature of the practices, but it can only be disclosed for the limited purpose of having the other law firm check their system to make sure there's no conflicts, whatever they're using for their conflict checking system. And it shouldn't go any further than the lawyer or the professional that's doing the conflict analysis. And there should be a signed statement and agreement that this information is being released for the sole purpose of determining whether or not there are conflicts with this lateral coming into the firm. Now, there becomes a question here, and it's really one of those catch 22s. Do you have to tell your client that you're releasing that information to a professional to see if you can make the lateral transfer and that that lateral transfer is effective? The answer to that is depends. It depends on the facts and circumstances. There's no clear, concise answer. If everything is done properly, there's no need to tell the client until after you've made the change, because if you've blocked the information at the new firm and of course the old firm, it's confidential information to them, they can't release it even if you're gone. Just because you're not there on the practice anymore doesn't make it any more or less confidential. It is confidential and cannot be released. Excuse me. So in that practice situation, you have to be careful but you also have to recognize that in most cases, if done right, you're not violating the rules and it's a permissible disclosure. There are times too that you are gonna need to get the client's permission because there are certain instances where releasing the information, even though you believe it's in the client's best interest, even though you, I'll give you the classic, you have a client that told you some things and now the client is in a situation where it's life and death for the client and you've got the power of attorney, who's making the decision, and you know that the client , you know that the client signed a new healthcare power of attorney, but asked you not to tell the former healthcare power of attorney that they were no longer the healthcare power of attorney. Now, first of all, you shouldn't have agreed to that, but this is a situation where you've gotta take the risk and you gotta assess the harm and you have to use the disclosure. And I'll tell you that because it really is a situation that I dealt with once and I had to give advice and counsel, and I really do believe the advice and counsel was good. Otherwise, the previous healthcare agent would've made a decision that was not in keeping with the current client's attitude and the current client's choice of who his healthcare power of attorney was going to be. So there are facts and circumstances. Other specs and circumstances, if it's your business, yeah, you can disclose. In other words, if you're in the business of managing stocks and bonds as well as practicing law, and you're in the business giving stock tips, you can work with a client if they're in business with you and you're not violating one of the other rules on being in business with clients, which isn't always a good idea. But boy, that's a real special circumstance, and I've got some case law in the materials that will help you understand that. But there's a huge split on self-enrichment. There's a huge split on whether an attorney, even if they're in business, a side business, real estate is another example that I remember from the materials that I researched, it gets tricky, and there's a lot of reason to believe that there are attorneys that are violating this rule, and the client is taking the position as long as everything goes well for the client and goes well for the attorney, what's the harm? You know, no harm no foul. If we go back to the risk assessment of harm, that's exactly what the rule contemplates. But I'm telling you, if it switches the other way, I wouldn't feel real comfortable in some of these quote/unquote "special circumstances." Co-client situations. There's very little case law but plenty of insight out there. If you've got two clients and you're representing both of them, you had better make sure you have in writing the disclosure saying, "I can share this information with the other client." And if they say no you can't, then that's time to break up the co-client situation because unless there's absolute agreement that you can share information back and forth between the two co-clients, it's impossible, I think, out of the rules, at least my statement of the rules, under the rule of competency, that you cannot possibly competently represent a client when you cannot disclose information that you legitimately believe would help the case for the co-clients that you're theoretically representing, because you have a duty of loyalty to both of them. And that duty of loyalty sits right there with that duty of confidentiality. So it's extremely important that you keep that in mind when you think that through. Okay, so we've spent the first half hour looking at the duty of confidentiality and looked at some of the facts and circumstances surrounding that, but now I'd like to talk about what we call privilege and work product rules, again from the perspective of how should you be using and how should you be looking at these rules? My fear, you know, is that too many people, again, misuse the rule or don't have a good understanding of the rule. So let's start by looking at the rule. Okay, what is privilege? Well, privilege is a rule of evidence, and I think that's important you understand that, that protects communications between clients and their lawyers. Now, we're not even talking about necessarily confidential information, we're talking about information that's shared between an attorney and his client. Now, remember that in contrast to the rule of privilege, the lawyer's ethical duty on confidentiality generally covers much broader circumstance then what the rule of privilege covers because the rule of privilege protects communications of all types between an attorney and the attorney's client, and it's a duty that is held by the client, not the attorney. So you may discuss strategy with the client, you may discuss different insights that you would like to share. Well, you can't necessarily do that without the permission of the client 'cause they hold this privilege and you have to keep that in mind. Now, the other thing that's important to recognize is that any type of attorney-client privilege has to look at three major factors. Number one, the intimacy of the attorney-client relationship. Privilege is not going to exist in just any relationship that may occur within a law firm and their clients. Certainly if you see a client at the football game over the weekend, or the basketball game last Thursday, or something of that nature, that's not privileged information. The client can't tell you, "Don't you dare tell anybody that you saw me at the game," because it's not within the scope of your employment. Yet oftentimes because of the intimacy of the relationship between the two, there are confidences that are outside of the attorney-client relationship that the client expects you as their attorney to keep because it would impact upon their lives and who they are. And that's where the world privilege sometimes gets messed up. So you have to remember it's completely dependent upon the facts and circumstances, and oftentimes on the ruling of the court. I mean, there's really, as I said before, nothing is really automatic. There's no cut in stone rule. I mean, we all know the United Shoe Machine Corporation case, and I think we all studied that in law school, where the court articulated the requirements. First, the person asserting the privilege must be a client or must have sought to become a client at the time of the disclosure. Second, the person connected the communication must be acting as a lawyer. Third, the communication must be between the lawyer and the client exclusively. No non-clients may be included in the communication. Fourth, the communication must have occurred for the purpose of securing legal opinion, legal services, and assisting in legal proceedings, and not for the purpose of committing a crime. Fifth, the privilege may be claimed or waived by the client only. And those are the five factors that you have to consider when you're looking at this whole rule, because the rule really relates to those. And that's where you get to the messy areas, which I talked about. The communication must be between the lawyer and client exclusively. Sometimes it's a visual observation, not necessarily a spoken word that the client wants to have privileged, and that's important. Sometimes it's a diagram, sometimes it's a, in the IP world there's information. And again that's why it's a duty to make sure that it's between just the client and the lawyer, that other people aren't involved. Because if they are, then privilege can go away. Remember, it's the client that can assert the privilege and that's important to keep in mind. Yeah, legal basis. And those are the points I just went through. And again, I just wanna reiterate those. But let's go to the exceptions because we've really touched on these already. And there are the exceptions. Okay, and I want you to really get these down because I think this is probably the most important thing. You go back to the basis, and we talked about the five points, but the exceptions, number one, if the communication was made in the presence of others who were not attorneys, in other words in your office, or not staff members, not only of you but sometimes of the client 'cause the client sometimes is not an individual but it's an entity, if it was in the presence of others, then that's an exception to the rule, then it's not privileged information. I represent municipalities on many types of zoning and, you know, property type issues, and oftentimes I will tell that client, "Communicate with me through a privileged communication, but for gosh sakes don't discuss it with five other people then call me up and say, 'I want to keep this privileged,' 'cause that's not gonna work." So you have to look at the whole spectrum of the discussion. The second exception to the world of privilege is communications for the purpose of committing a crime are not privileged communication. A client calls you up and tells you that they've gonna do this fraud , they can't tell you you can't communicate that. Now, don't forget, you still have the rule of confidentiality. So when we talk about privilege, what are we talking about? We're talking about suddenly you're in a court situation, or you've got a DA talking to you, and the client's saying you can't talk about that. It's the client asserting a privilege. It's an evidentiary rule, it's not an ethics rule. Keep that in mind. So again, look at the context. Exceptions also, the waiver by a client. The client waives the right of privilege, the client waives it. And most often I find the client waives the right privilege by telling other people. I'll work and work and work with a client, saying, "Just keep this between us, 'cause it's privileged communication." I'll send them something that I want them to rely on for legal opinion, legal work, and what's the first thing they do? They share it with five other people. That's waiver by the client, and that's, you know, it's gone. They cannot use it to commit fraud. A client can't say that's privileged. In other words, send you something and say, "Here, keep this, this is privileged information." And you're going, "No, it's not. I mean, you're trying to use me to commit a fraud on somebody else. That's not gonna work, and that gives you an exception." Another is supporting a claim for compensation. In other words, no, they can't assert privilege saying you can't talk about that. I'm gonna say doggone right I can talk about how much work I did for you and what I gave to you for the purpose. It's very important that you understand that exception. Another exception that really comes into play, hopefully not too often, and we talked about this a little bit in our confidentiality, but again it comes up with the world of privilege, and that's when you're in a situation facing disciplinary actions, you have absolutely every right in the world to, if the client tries to assert privilege saying you can't testify to that, and you say, "Yes I can, your privilege is not gonna stop me." Probate of a will is another example under the law that most states will require that a lawyer must disclose confidential information, and the client can't assert privilege if it relates to the probate, you know, and the information has to be disclosed so that a fraud isn't committed on the court. And that's most often where we see that. Now, you gotta be careful here because in some cases you may have a will that leaves, you know, a provision to a former paramour or a, you know, out of wedlock child or something of that nature, and the client has told you, you know, "You cannot tell anybody about this child. Just leave the name in there, you know, Thomas Jones, and don't tell why." Well, you may be forced into a situation, and the privilege does not protect into that situation. The court has made that very clear in quick cases. Courts have the power, too, to revoke their privilege, often after death of the client. The court can say, "I'm gonna relieve you of the privilege because I need this to resolve a dispute amongst the heirs," for example. And we look at that. Understand too in the United States that communication between accountants and their clients are not privileged. So if a person is worried about accusations of questionable accounting, such as tax evasion, they may want to work with an attorney, and the attorney may want to hire the accountant so that the information is between the attorney and the client, not between the client and the accountant. The accountant is hired by the attorney. Theoretically, the accountant's working for the attorney, he's not working for the client. And therefore because it's a work product of the attorney, you can protect that communication. We do this often when we do estate planning and we're looking at valuations. We wanna keep that valuation material as a work product. We want it protected under the rules. And to do that as an attorney work product and a privileged communication when we give it to the client, it's coming from us, it's not coming from the accountant, because it's very clear that accountants are not protected, and if an accountant would be forced to testify if they had a relationship with the client and became necessary to release that evidence in court for a prosecution of a case or whatever it might be. So it's essential that you understand that that's the reason you want to always hire people. Which gets us into what I was going to try to suggest is this doctrine that we wanna work on, and it's called the work product doctrine. Now, again, I'm going over the top of some very, very difficult and detailed concepts, but I wanna give you enough to understand that there is no clear black and white, even though my slides are pretty black and white, but there's a lot of gray and you need to spend time. I want you to get the concepts here and where to look for some of the traps or the misconceptions. The work product doctrine is recognized as a court rule that protects documents and tangible items that are put together in preparation for litigation by or for a party and their representation. So it's a rule of evidence again, and it recognizes that any of these documents that are put together are the product of the attorney. They're part of the system. In and of themselves they're not discoverable because they're not facts, they're not evidence. Well, they might be evidence, but they're not facts and they really belong to the attorney because they represent the attorney's mental impressions, conclusions, opinions. They don't really represent what is often referred to as factual evidence. There are many, many times concepts that an attorney throws out and they're protected as such. Now, sometimes a client will want to waive the rule, but this is a rule that belongs to the attorney. This isn't the privilege, this is the work product doctrine, this is saying, "Oh, this is my stuff. You're not gonna dig in my file." And the reason we do that is because attorneys have to be free to speculate, to conjure up different ideas, and to do different strategies in their preparation for representing the client. And a lot of times these documents are there, and they're created for use later on, but the court may look at them and say, "Yeah, I don't think that's privileged," or, "I think that is privileged. I don't think that the client can protect that piece of paper. I think that that piece of paper has to be released." So you want to make sure that you look at that. One of the things that I like to remind people is that the work product recognizes, is that there has to be a preparation for some type of litigation, but it doesn't have to be judicial proceedings, it could be arbitration, it can be mediation, it can be administrative hearings, it could be government investigations, it could be a grand jury, it can be depositions, it can be any type of preparation for complaints, an internal office or a business investigation. So when you talk about that work product doctrine, it does go beyond some of the things that you think about normally when you're looking at this. The rule does say that the evidence is protected unless they can show a substantial need for the materials, and they cannot be obtained by other means. You know, that rule or that protection tells me that in order to meet this burden, and I did a lot of research on this coming into this, is that it's highly unlikely that any product that's put together by an attorney can be demonstrated to have a substantial need and that it cannot be obtained. In other words, there's some information that the attorney's collected. Now, yeah, I mean, if there were a building that was constructed and you'd hired an engineer to go into the building and the engineer had researched all the factors that were causing problems and then three days later a hurricane hit, the building's destroyed. So there's no possible way anyone else, or no other means for someone to get those engineering materials. Nobody could ever reproduce those. Then I think you've got an argument that says that's not work product, that that's necessary in the interest of justice, and that's the exception that can be argued to the court and can be presented to the court. It doesn't happen often, but it does happen, and it always finds itself in the world of, this was evidence on such and such a day, and that date is gone, and there's no way of recreating that evidence, but it does exist, so why can't we have it? That's the argument that opposing counsel will often use under this rule of evidence to try to get to work product. Now, one of the other things that you can do, as I call 'em the best practices that I outlined, is you can make efforts to make sure that your work product is there, understanding that the court's going to apply the rules differently. Generally, the court's not gonna get involved with thought patterns, but they are gonna get involved in these other doctrines, and you can easily argue that somebody else could have done the engineering, somebody else could have gone there, that just because you went doesn't mean that that day is passed so nobody else can get there. There's three tests that courts apply whether or not work product. Was it produced because of the prospect litigation? Was the prospect of litigation the motivating factor in doing the work? And was it for use in the litigation? If you can meet those three tests, when I put together arguments for protecting work product, this is always the standards that I use is this three part test, and look to apply it so that we can utilize this to protect the work product. Okay, we're talking about applications of the rule, and I've mentioned this several times, and it goes into many different types of proceedings, not just your litigation. And I think that's important to keep in mind because a lot of people think that it's only a rule of evidence in court, and that's not true. It's a rule of evidence in all these different type of litigious matters. But the other factors I want you to consider when you're thinking about protecting the privilege and you're trying to work with your client on how can we prepare the case and how can we keep things that are privileged or, you know, we talked about the work product doctrine, is to make sure everybody understands. I mean, I have to educate clients often, saying, "This is privileged information." I mark it privileged. I create a paper trail so that if I ever have to go to court, I can show the court that we've always kept this privileged. Now, remember, this whole concept of work doctrine and work product and all this material, it's really hard to waive, but it can if it gets shared improperly. And that's the biggest thing. You put together a diagram, you put together, I see it all the time when people put together appraisals or economic analysis and you give it to the client and the client gives it to their accountant, not the accountant that you hired, but to a different accountant. These are the things that can destroy the whole basis of what you're doing. And when you're creating this work product, do this, do the favor for yourself. In the margins in the document, always write in things like "This is my impression." Put your subjective thoughts in there. "This is an interesting financial analysis of ABC Corporation, but you have to look at this from the perspective of the modern economies. In my impression of this organization, these numbers may or may not have relevance if one were to twist a couple of the circumstances that existed at the time that this company was making this profitability." This is something we use a lot when we go back and talk about the effects of the pandemic. We need to make sure that we put these subjective thoughts in there. And then, you know, build a catalog, you know? I've mentioned this several times about judges and how they think and how they, you know, certain judges want to hear certain magic words and you want to do that, you want to put that together. It's important that you do that. Keep in mind that privilege extends to various and sundry areas. It's not just limited. And I talked about this before. And I know it may sound a bit repetitive but make sure. And I go to my last comment here, I referred to the others before, is make sure that you are keeping those contractors, those people that you're using to prepare the financial analysis, the valuation reports, those outsiders, make sure you keep them under the rule of confidentiality. Keep them part of your work product. And emphasize that to them. Tell them not to call the client. Tell them not to disclose this to any other person because you have to show that you've done that, to show that you've protected, because if there's an inadvertent slip, which we'll talk about, if there's an inadvertent disclosure, you wanna be able to say it was inadvertent, it's protected, your honor. Because the law does, and I'll point out in a little bit coming up here, that there's slips in the system or allowances through email that's been hacked or something of that nature is not going to relieve a well-prepared work product doctrine case or evidence from being disclosed because the rules of evidence will prevent it 'cause there's a rule on inadvertence, which we'll talk about. So keep all this in mind. Work hard, put it together, lay it out because these are the things that you want to protect. You don't want to lose that work product. The client can't waive it. It's not up to the client to waive your work product rule. They can waive the right of privilege, but they're not gonna waive the work product. So let's talk again then about the client's right to waive privilege. And the factors, I've kind of gone over these, but these are the factors I try to use when I help other attorneys at the firm. First, can be prepared by others, even by a client. If it can, you should have it as work product. Put labels on it, put paper trails. Write your own reasoning why this document, you know, I create a file when I do litigation that says, "attorney-client privileged information," one file. "Attorney work product," another file. I mean, I create these and I put 'em in there, and I do that because, I guess because I'm an ethics nerd, if you wanna use that word. But it really does help. Another thing that is good to do is know your judges. Those of you that are litigators, it's really important that you know certain judges rule certain ways, and certain judges will wanna see certain things. So it's important that you do that and you take a good look at that. Different areas of privilege. The common interest privilege. This is your joint defense privilege. It's a separate privilege that says that it can be held by more than one person. It could be held by two or more if there's a joint defense. We see this a lot in major litigation, well, commercial litigation. I've seen it a lot in IP litigation where there's more than one defendant, and they'll have common interests that'll be privileged. Attorney-client in the corporate setting. Be very, very careful of this one because the corporation itself may not have the privilege, but the people within the organization may have the privilege. Build that privilege, you know, appropriately. Don't just assume that the president is the holder of the privilege. Oftentimes you need to build a cadre and you need to build a group and you need to designate that this is the group with the privileged information. You need to create that symbol in the pleadings as quickly as you possibly can so that you can assert privilege later on. And we've talked already about the privileged use of the client's independent contractors because you should be bringing those in-house and those should be the you as the attorney's contractors, not the client's, because a lot of times the communications between the client and their independent contractors are not privileged and you're not gonna be able to save it. So you want to look at that and you wanna make sure you understand the rules with regard to that. Waiver is the other thing you need to keep your mind on. Just make sure that you have the proper parties. I've talked about that. Waiver can occur so easily when clients get a little bit slipshod. There is a rule that you should, before we close out today, understand, and that's the inadvertent disclosure rule. This is a rule that says even though you sent an email or something, or you've left a paper in the courtroom, you can still grant privilege. Understand rule 502, those of you that have the federal rules of evidence, or those of you that your state has adopted that. It's often important that you use this rule to protect evidence that was inadvertently left out or inadvertently shared. The biggest thing is the bad email. And some courts look at it differently, but it is a good rule and it should be used. Expectations. Never forget that there's an expectation and you control that expectation. Confidentiality is a legal standard that is created and it belongs to you as a lawyer as a standard, whereas privilege belongs to the client. But the duty to inform the client as to what is privileged and how it works and to communicate and educate the client is your duty as the attorney. It's important that you recognize that duty. How to lose it, and we've talked about that. One of the things you really wanna look at is inadvertent disclosure does not include people that hack your email or people that try to breach your privacy. That's protected and it's still privileged. It may not say to the fact that the information is there, but it will say to the fact that you didn't breach your rights of confidentiality and it still will give you privilege to use as an evidentiary matter, even though the emails or the materials were hacked. Everybody should realize that if they're an employee, the email belongs to the employer. I just throw this in as kind of a side note. But again, if you're representing and you're in the world of labor or you're in the world of human resources, it's important to understand who owns the communication, who has the right to claim privilege, who has the right to claim confidentiality? Metadata is something we all should be concerned about, and again, this program really isn't going into that. But again, I wanted to put this in here because I wanted you to recognize that disclosure in metadata is still protected and you can still advocate work product and attorney-client privilege, even though the metadata disclosed the information as to what you were doing to put together the letter. Steps. Disclaimers are good to use in any type of communication trying to protect, I said, titling thing as privileged and confidential. I do it all the time with email. Every lawyer should do it with their email. Keeping a roadmap so you can provide to the court why the material is protected, why the material is privileged is excellent to do. Just, you know, use other tools that are available. Security is so important. Privilege logs are something that I encourage you to do. Remember, I told you I do that. I keep a log of all the privileged communications. I keep them as part of my litigation files so that I know what I can assert and I can show that I did it contemporaneously. And that's important, contemporaneously encryption. Well, as we hit the bewitching hour, I would like to conclude with just two big comments. Remember, confidentiality, that's the king, that's the rule. That's what you gotta live by. But privilege there is the protective knight to guard the king. So privilege protects our confidentiality. So with that, we'll bid you adieu. I hope you've enjoyed this program. I hope it's given you some insight. And we'll look forward to you being with us again for more programs to come. Thank you very much.