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Attorney-client privilege in cross-border investigations

English high court ruling highlights limitations

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Publication January 2017

In any investigation, practitioners should consider at the outset the importance of the attorney-client privilege to the subject matter of the investigation.

If it is deemed desirable for the attorney-client privilege to apply, practitioners should ensure that appropriate steps are taken to attempt to establish and maintain the privilege. However, doing so can be fraught with difficulty, especially when multiple jurisdictions are involved.

A recent English High Court case illustrates the difficulties that can be encountered when local privilege laws apply.

Practitioners who are accustomed to the jurisprudence surrounding the attorney-client privilege in the US may be surprised by the limitations that some foreign jurisdictions place on the application of the privilege.

For example, the English High Court, applying English privilege law to an international investigation which included responding to two subpoenas issued from the US authorities, held that interview notes compiled by both in-house and external lawyers of interviews with current and former corporate employees were not privileged.

Critically, the court found that the interviews of current and former employees were for the purpose of information gathering to enable the corporate representatives to seek and receive legal advice; however, the communications did not occur between the lawyers and the “client”, with “client” being defined narrowly to include only the person or persons authorized by the company to deal with specific legal issues.

The court noted that the lawyers’ thoughts and impressions would almost certainly be privileged under the legal professional privilege, but that the client’s evidence did not substantiate the claim.

For more information on the case, read our publication, “Privilege and the ‘client’: The RBS Rights Issue Litigation.

The case highlights critical takeaways for US practitioners involved in investigations:

  1. Consider critically if claims could arise in non-US jurisdictions. If cross-border conduct is involved, and the conduct could give rise to a claim outside the US, that jurisdiction may apply its own privilege law to the investigation. If privilege is not appropriately established and maintained within that jurisdiction, the materials and information may have to be disclosed, and thus may also destroy the privilege within the US.
  2. Consider critically the involvement of non-US in-house counsel. While the US tends to be more protective of a privilege existing between in-house counsel and their corporate client, that privilege can be nonexistent or critically truncated in other jurisdictions.
  3. Consider involving external counsel. While this factor was not at issue in the English High Court case, claims of privilege involving external counsel are less likely to face challenge on the ground that the advice being dispensed is principally business advice as opposed to legal advice, and therefore not subject to the privilege.
  4. If it is desirous that attorney-client or work product/legal professional privilege apply, take steps to establish that the application of such privilege is appropriate. For instance, interview notes should not merely state that they contain attorney mental impression and advice, but should appreciably contain such impressions and advice. In addition, if the privilege is challenged, the practitioner should be able to generically describe in sufficient detail the types of observations and impressions contained within the document, and how the attorney’s thoughts, impressions, or trend of advice could be deduced by the content or omission of content from the writing.
  5. If English law may apply to the investigation, consider critically who the “client” would be, and carefully evaluate the content of any communications with individuals other than those comprising of the “client,” as such communications may ultimately be discoverable.  It is hoped that the narrow definition of “client” that exists may be broadened at some point on appeal, but in the meantime extreme care should be taken at the outset to maximize the chance of privilege being maintained.  The English decision does not create new law but highlights the pitfalls that can arise in cross-border investigations. For more information read our publication, “Privilege and the ‘client’: The RBS Rights Issue Litigation.

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