This guest post was written by David Booth Alden. Mr. Alden is a partner resident in the Cleveland office of Jones Day. This post is entirely his work. It, of course, represents only his views and not the views of his clients or firm.
Your law firm sends you a lengthy legal analysis of a new federal statute that applies to your industry. You pay them a ton of money for this legal advice and fully expect this advice to remain between you and your attorneys. You certainly don’t expect to have to produce the analysis to litigation adversaries because, if anything is protected by the attorney-client privilege, this is.
If you’re in Pennsylvania, not so fast. The Pennsylvania Superior Court’s decision in Nationwide Mutual Insurance Company v. Fleming, 2007 PA Super 145, 924 A.2d 1259 (2007), takes a narrow, “one-way street” approach to the attorney-client privilege. (Disclosure: My firm represents Nationwide, but not in this matter; I have not represented Nationwide.) There, the trial court had found that, by producing two documents voluntarily, Nationwide waived its attorney-client privilege claim for a third document based on the “subject matter” waiver rule. On appeal, the intermediate appellate found that, because neither of the two produced documents was privileged, there was no “subject matter” waiver as to the third document.
But the Superior Court did not stop there; instead, it then examined the attorney-client privilege claim for the document at issue, a memorandum by an attorney in Nationwide’s general counsel’s office addressed to fifteen Nationwide employees. According to the Superior Court, the document discussed “on-going efforts to manage agent defections” and “outline[d], … in general terms, counsel’s opinion as to the likely outcome of current and pending litigation.” Id. at ¶ 29.
Applying Pennsylvania’s statutory attorney-client privilege and focusing on only the attorney-client privilege (i.e., not on the work product protection, which apparently was not asserted), the Superior Court found that “[c]ommunications from counsel to a client may be protected …., but only to the extent that they reveal confidential communications previously made by the client to counsel for the purpose of obtaining legal advice.” Id. at ¶ 27 (citations omitted) (italics in original). Because the document at issue “d[id] not disclose any confidential communications by … the client, to its counsel” — but only by counsel, to the client — the Superior Court found that the document was not privileged and ordered it produced.
This approach certainly is not the majority rule, as federal and state courts outside of Pennsylvania have considered and rejected it repeatedly. See, e.g., Sprague v. Thorn Ams., Inc., 129 F.3d 1355, 1370 (10th Cir. 1997) (surveying federal authorities, but interpreting Kansas attorney-client privilege law); In re LTV Sec. Litig., 89 F.R.D. 595, 602 (N.D. Tex. 1981) (federal common law); Spectrum Sys. Int’l v. Chem. Bank, 78 N.Y.2d 371, 379, 581 N.E.2d 1055, 1060 (1991) (New York law); see generally Uniform Rules of Evidence 502(b) (1986 rev.); Restatement (Third) of the Law Governing Lawyers § 69, comment i (2000). But the Pennsylvania Superior Court’s approach in Fleming is not unique, either. See, e.g., Tax Analysts v. I.R.S., 117 F.3d 607, 618 (D.C. Cir. 1997) (referencing In re Sealed Case, 737 F.2d 94, 99 (D.C. Cir. 1984), and Mead Data Central Inc. v. U.S. Dep’t of Air Force, 566 F.2d 242, 254 (D.C. Cir. 1977)); Loftis v. Amica Mut. Ins. Co., 175 F.R.D. 5, 9-10 (D. Conn. 1997) (predicting Connecticut law).
The Pennsylvania Supreme Court recently agreed to hear an appeal in Fleming, 2007 Pa. LEXIS 2361 (Oct. 31, 2007), so the Superior Court’s decision may not be the last word. For now, however, Fleming shows that not much has changed in Pennsylvania since Ben Franklin observed that “in this world nothing can be said to be certain, except death and taxes.”