III. The Inadvertent Production of Confidential Information and Its Consequences for Senders and Recipients
Inadvertent disclosures of confidential information, including privileged documents or documents entitled to protection as work product, are disturbingly frequent, even in cases handled by careful lawyers. A number of factors contribute to the widespread problem of lawyers failing to protect confidential information from unintended disclosure. These include the pressure to produce large numbers of documents within tight deadlines; the daily burdens of a busy law practice; the delegation of key tasks (often driven by a client's desire to reduce costs) to young lawyers, contract lawyers, or non-lawyers who are not intimately familiar with a case; the increasing volume of documents created and stored electronically; and the common transmission of documents electronically. Not surprisingly, lawyers' greatest concern arising from unintended disclosure of otherwise confidential materials is whether the unintended disclosure will be treated as having waived protections under the attorney-client privilege or work product doctrine or both. These are obviously concerns for clients as well, since courts' determinations of the effects of inadvertent disclosure may materially influence their cases.
Hovering beneath the surface of this question are the principles and purposes underlying the attorney-client privilege and the work product doctrine, the differences with respect to what it takes to waive each, and what it is we are really referring to when we discuss inadvertence in this context. It is generally accepted that the attorney-client privilege belongs to, or is held by, the client, but it is also generally accepted that a lawyer may voluntarily waive the privilege for the client.49 Where a lawyer does so, she does so as the client's agent. The attorney-client relationship is, of course, an agency relationship in which the client is the principal and the attorney is the agent.50 As to work product immunity, it is generally accepted that this protection is better understood as belonging to both the lawyer and the client.51 As a practical matter, the lawyer has a much larger perceived ownership stake in her work product than the client when it comes to questions of whether to voluntarily waive its protections. Nevertheless, given the agency relationship in play where work product is being created for the benefit of the client, voluntary actions by the client can waive work product protection.
Just as the contours of the attorney-client privilege and the work product doctrine differ, what is necessary to waive those protections differs as well. Unlike the attorney-client privilege, the majority view is that work product immunity is not waived merely by disclosure of protected information or materials to any stranger to the attorney-client relationship. Rather, consistent with the purpose of the work product doctrine, which "is to protect material from an opposing party in litigation, not necessarily from the rest of the world generally,"52 a disclosure of work product to a third party only waives the doctrine's protection if the disclosure substantially increases the risk that the work product will be disclosed to an adversary.53 Boiled down, work product immunity is waived only by disclosure of otherwise protected information to an adversary or a conduit to an adversary.54 This distinction as to waiver is elucidated by a federal district court decision issued as part of the proceedings that ultimately resulted in the criminal conviction of celebrity homemaker Martha Stewart.55
During the time that Stewart was being investigated for alleged securities law violations, she sent an e-mail containing her factual recollection of certain events to her attorney. The next day, Stewart forwarded a copy of that e-mail to her adult daughter, Alexis Stewart.56 The district court concluded that the contents of Stewart's e-mail to her attorney were originally entitled to the protections of both the attorney-client privilege and the work product doctrine, but that the act of forwarding the message to her daughter waived the attorney-client privilege as to the contents of the e-mail given that her daughter, despite being a close family member, was still a stranger to the attorney-client relationship.57 The court, however, correctly concluded that the protections of the work product doctrine were not waived even though Stewart's daughter was not a person who would aid the litigation in any way. The court explained that no work product waiver occurred because Stewart's daughter, described by Stewart as her closest confidante, was not likely to disclose the contents of the email to Stewart's adversary in the litigation—the United States government.58
In Stewart, because the act of sending the e-mail was an act by the principal, the court did not have to grapple with questions of agency law to determine whether, for example, the attorney-client privilege should be deemed to be waived. Consistent with fundamental principles of agency law, the lawyer should only be able to waive the attorney-client privilege on behalf of the client when the lawyer is appropriately authorized to do so. Application of these basic agency principles to normal circumstances in which lawyers purposely disclose information while representing their cli-ents—for example, by including documents in a set of discovery materials produced in response to an adversary's request—undoubtedly can amount to a waiver of privilege. Typically, opposing counsel are entitled to treat such actions by a lawyer, acting as a client's agent, as being within the scope of the lawyer's actual authority, or at least as occurring under circumstances where there is no reason to doubt the lawyer's apparent authority to produce the documents. Clients and lawyers often produce documents that are privileged or that might otherwise enjoy work product protection when they think that doing so serves important strategic goals in the litigation. Absent a basis in fact to know that an attorney was not authorized to produce particular documents because they were privileged, opposing counsel should be permitted to presume the lawyer's actual authority. This is especially true given that opposing counsel cannot ethically communicate with the lawyer's client to determine the scope of the lawyer's authority.59 To better understand the difficulties and nuances associated with whether inadvertent disclosure should result in waiver, a brief detour involving one court's struggle to avoid binding a client by an attorney's clearly voluntary (though seemingly incompetent) actions is in order.
In Harold Sampson Children's Trust v. Linda Gale Sampson 1979 Trust,60 one of the plaintiffs prepared a number of documents on litigation strategy and related issues for use by the plaintiffs' counsel at the time, Wisconsin lawyer Robert Elliott. Elliott, somehow believing that no privilege attached to the documents, produced them to defense counsel in response to a discovery request.61 Elliott was replaced as counsel several months later for unrelated reasons, and the plaintiffs' new counsel soon determined that these privileged documents had been produced. The plaintiffs' new lawyers requested return of the documents, but defense counsel refused.62
It was undisputed that the documents would have been privileged but for their production and that Elliott's clients were not aware of the production and had not specifically consented to it. The Wisconsin Supreme Court described the question it faced as whether "a lawyer's voluntary production of documents in response to opposing counsel's discovery request constitutes a waiver of the attorney-client privilege . . . when the lawyer does not recognize that the documents are subject to the attorney-client privilege and the documents are produced without the consent or knowledge of the client."63 The trial court had answered this question in the negative. The Wisconsin Court of Appeals had answered the question affirmatively based on agency law principles. The Wisconsin Supreme Court, like the trial court, ultimately held that Elliott's production of the documents did not waive his clients' privilege.64 In so doing, the supreme court rejected the court of appeals' reasoning that, because an attorney is an agent of a client and because the clients had delegated the management of discovery to Elliott, Elliott's voluntary production of the documents in discovery constituted a waiver of the attorney-client privilege.65
Although the Harold Sampson court indicated that it did not consider the case to be an "inadvertent disclosure" case, explaining that "[t]he only mistake seems to have been the attorney's conclusion that the documents were not privileged,"66 that is also "the only mistake" that lawyers make in cases where, for example, they inadvertently include privileged documents among non-privileged ones in a document production. And in resolving the matter, the Wisconsin Supreme Court's ruling belies its protestation that it was not treating the case based on principles applicable to questions of true inadvertent disclosures, as it justified its conclusion that there was no waiver on its belief that permitting a waiver in these circumstances would be placing too great a burden on the attorney-client relationship.67 Consequently, the defendants could not share the documents with their experts, could not use those documents for any purpose, and had to return the documents to the plaintiffs.68
Prior to the adoption of Federal Rule of Evidence 502 in September 2008, federal courts and state courts alike had developed a variety of approaches to analyzing questions of whether the inadvertent disclosure of attorney-client-privileged information would waive the privilege. These approaches can be readily classified into three categories: the strict approach, the lenient approach, and...
