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The Challenge Continues: Protecting Privileged Information

Created on October 21, 2011

Vice President, E-Discovery

A frequent theme of e-discovery case law in 2011 is protecting attorney-client privilege in the e-discovery realm. Primarily due to mistakes and ignorance in dealing with electronically stored information (ESI), parties have inadvertently produced and subsequently waived their attorney-client privilege, disclosing to opposing counsel valuable private information. Not only does this impact case outcomes, but it can also bring about negative publicity and adversely affect brand reputation for the law firms and corporate clients they represent. Case in point: MSP Real Estate, Inc. v. City of New Berlin (E.D. Wis. July 22, 2011).

In MSP Real Estate, the plaintiff, MSP, sought an order to declare that the defendant, City of New Berlin, waived its attorney-client privilege by producing 30 privileged documents in reply to a public records request by the plaintiff. The court used a three-part test to review the waiver of privilege claim:

  1. Where the documents disclosed privileged?
  2. Was the disclosure inadvertent?
  3. If first two parts met the criteria, was, in fact, privileged waived?

As to the first part of the test, the court ruled that the documents were privileged due to both parties agreeing on this fact.

In determining part 2 of the test, the court stated “whether the disclosure was inadvertent, the court must look to the totality of the circumstances" surrounding the case. Here, the court emphasized the fact that the defendant's review and production procedures were inadequate and “so deficient" that disclosure was inadvertent.

Since the first two parts of the test were met, the court used a balancing approach to determine if privilege was waived. The court focused on whether the defendant took reasonable precautions to prevent disclosure. The court deemed that privilege was in fact waived due to the defendant's inadequate review and production process, noting the following facts:

  • “Failure to identify and mark individual documents and relying on Post-IT notes to identify" if a document is to be released, withheld or released after redaction
  • Failure to maintain or provide the plaintiff with a privilege log to identify and track privileged documents
  • Lack of attorney involvement/supervision over the initial review process

This case, and similar matters it in 2011, illustrate how parties are consistently tripping over issues concerning attorney-client privilege and inadvertent production. Both sides need to better understand what information they have and what needs to be protected once litigation arises to preserve confidential and privileged information. In MSP Real Estate, it would have behooved the defendant to implement a workflow-driven business process to handle the e-discovery process. Evolving technology is enabling legal teams to more effectively manage ESI, meet legal obligations and demonstrate to the court that “reasonable means" were taken to “preserve confidentiality of the privileged matter."

To learn more about workflow-driven e-discovery management, click here.

Mike Hamilton, J.D. is the E-Discovery Market Analyst at Exterro, Inc. Hamilton works in a product management and marketing role to ensure Exterro's Fusion e-discovery applications closely reflect the needs of legal teams. Within the complex e-discovery world, Hamilton's knowledge, legal acumen and experience give him a valuable perspective on bridging the gap between IT and legal teams.