Attorney-Client Privilege -

New York

I. State the general circumstances under which the jurisdiction will treat a communication as attorney-client privileged, including identification of all required elements/circumstances.

In New York State, the law codifying the attorney-client privilege can be found at CPLR 4503(a)(1). Additional sections of the statute abolish the “fiduciary exception” to the attorney-client privilege regarding communications between counsel and the personal representative of a decedent’s estate (CPLR 4503(a)(2)) and creates a statutory exception to the privilege where the confidential communication in dispute was held between a deceased client and the client’s attorney that involved the preparation, execution, or revocation of any will of that client or other relevant instrument (CPLR 4503(b)).

To invoke the privilege under CPLR 4503, the information sought to be protected must be a communication between counsel (or counsel’s subordinate) and the (current or prospective) client that was had for the purpose of securing legal advice and not for the purpose of committing a crime or tort. In re Grant Jury Subpoena for Documents in Custody of Bekins Storage Co., 118 Misc.2d 173, 177 (N.Y. Sup. Ct. 1983); United States v. United Shoe Machinery Corp., 89 F. Supp. 357, 358 (D. Mass. 1950). Additionally, the communication must have been made with the intention that its contents remain confidential. Id. The party asserting the privilege bears the burden of proving his or her entitlement to its invocation. Ambac Assur. Corp. v. Countrywide Home Loans, Inc., 27 NY3d 616, 622-624 (2016). The privilege is one that belongs to the client, not the attorney, and because the privilege is an “obstacle to the truth-finding process, its scope is limited to that which is necessary to achieve its purpose.” In re Grant Jury Subpoena for Documents in Custody of Bekins Storage Co., 118 Misc.2d 173, 178 (N.Y. Sup. Ct. 1983).

Of relevance to the attorney-client privilege inquiry is Rule 1.6 of the New York Rules of Professional Conduct entitled “Confidentiality of Information” which holds that “[a] lawyer shall not knowingly reveal confidential information . . . or use such information to the disadvantage of a client or for the advantage of the lawyer or a third person . . . .” N.Y. RULES OF PROF’L CONDUCT r. 1.6 (N.Y. BAR ASS’N 2010). The Rule’s opinion provides that “confidential information” can be any information learned during or relating to the representation of a client that is either protected by the attorney-client privilege, embarrassing or detrimental to the client, or information the client has otherwise requested to remain confidential, but does not typically include an attorney’s legal knowledge or research or generally known information. Id.

II. Does the jurisdiction recognize/preserve the attorney-client privilege for communications among co-defendants in joint-defense or common-interest situations? If so, what are the requirements for establishing two or more co-defendants’ communications qualify?

In general, a client in New York State does not enjoy confidential privilege when communicating with counsel in the presence of any co-defendant or third person as it constitutes a waiver of that privilege. However, where co-defendants are establishing a common defense, their statements are privileged, but only if such communications are for that purpose, known as the common interest doctrine. Otherwise, the mere presence of a co-defendant, his counsel, or any other third party will destroy any expectation of confidentiality between the original client and his attorney. People v Osorio, 75 NY2d 80 (1989).

The common interest doctrine has been applied to both criminal and civil matters and to communications of both co-plaintiffs and co-defendants. See, e.g., Hyatt v. State of Cal. Franchise Tax Bd., 105 A.D.3d 186 (2d Dept 2013). The requirements for invocation of the common interest doctrine are that (1) the communications in question must otherwise qualify as privileged, (2) the party asserting the doctrine must share a common legal interest with the party with whom the information was shared, and (3) the statements for which protection is sought must have been in furtherance of that shared legal interest. Egiazaryan v. Zalmayev, 290 F.R.D. 421, 434 (N.Y.S.D. 2013). The doctrine will also apply where the co-parties are represented by different attorneys. Id. As will be discussed in greater detail below, the New York Court of Appeals has interpreted an additional requirement that litigation must also be pending or anticipated which differs from that of the federal standard, extending the privilege regardless of whether litigation is pending or threatened. Ambac Assur. Corp. v. Countrywide Home Loans, Inc., 27 NY3d 616, 628-629 (2016); In re Teleglobe Communications Corp., 493 F.3d 345 (3d Cir. 2007).

III. Identify key pitfalls/situations likely to result in the loss of the ability to claim the protection of the privilege – e.g., failure to assert, waiver, crime-fraud exception, assertion of advice counsel, transmittal to additional non-qualifying recipients, etc.

The most common pitfall in the realm of attorney-client privilege is a waiver due to the disclosure of otherwise confidential information to third parties or the presence of third parties during communications. This may occur by means of verbal face-to-face communications, a release of documents, or even sending an e-mail, and may happen intentionally or unintentionally. People v. Osorio, 75 NY2d 80 (1989). In this regard, the scope of the privilege depends on “whether the client had a reasonable expectation of confidentiality under the circumstances.” Id. at 1186 (citing Matter of Jacqueline F., 47 NY2d 215 (1979); In re Kaplan, 8 NY2d 214 (1960)).

A second common mistake that is made which may result in the loss of the attorney-client privilege is confusing business advice with legal advice or mixing the two into a singular discussion. “The communication must be made for the purpose of obtaining legal advice and directed to an attorney who has been consulted for that purpose. Conversely, one who seeks out an attorney for business or personal advice may not assert a privilege as to those communications.” In re Grand Jury Subpoena Served upon Bekins Record Storage Co., 62 NY2d 324, 329 (1984) (citing Matter of Priest v. Hennessy, 51 NY2d 62, 68-69 (1980)). Similarly, it is important to keep in mind that underlying factual information is not protected. See Spectrum Sys. Int’l Corp. v. Chem. Bank, 78 NY2d 371 (1991).

A third situation to be weary of when attempting to maintain confidentiality under the attorney-client privilege derives from Rule 1.6 (b) of the New York Rules of Professional Conduct. Under this Rule, an attorney may (meaning he or she is not required to, but may elect to do so) disclose otherwise confidential information (1) to prevent reasonably certain death or bodily harm, (2) to prevent the client from committing a crime, (3) to withdraw a written or oral opinion by the lawyer who now believes the opinion to be materially inaccurate or is being used to further a crime or fraud, (4) to secure legal advice about compliance with the Rules, (5) to defend the lawyer or his or her employees/associates against a claim of wrongful conduct, or (6) when otherwise permitted or mandated to under the Rules or to comply with another law or court order. N.Y. RULES OF PROF’L CONDUCT r. 1.6 (b) (1) – (6) (N.Y. BAR ASS’N 2010). Thus, when the attorney is placed in any of these situations, he or she has the discretion to disclose otherwise confidential information of a client and will not be held to be in violation of the Rules.

One final example of situations that can result in the inadvertent loss of the privilege is in the case of the fraud-crime exception. Under this rule, “[a]dvice in furtherance of a fraudulent or unlawful goal cannot be considered ‘sound.’ Rather advice in furtherance of such goals is socially perverse, and the client’s communications seeking such advice are not worthy of protection.” Matter of New York City Asbestos Litig., 109 A.D.3d 7, 10 (1st Dept 2013) (citing In re Grand Jury Subpoena Duces Tecum, 731 F.2d 1032, 1038 (2d Cir. 1984)).

IV. Identify any recent trends or limitations imposed by the jurisdictions on the scope of the attorney-client privilege.

In 2016, the Court of Appeals issued a decision in Ambac Assurance Corporation v. Countrywide Home Loans, 27 NY3d 616 (2016) which placed a substantial limit on the attorney-client privilege by holding that while parties who share a common legal interest may invoke the attorney-client privilege for communications relating to litigation, either pending or anticipated, under the common-interest doctrine, the privilege will not apply in the context of business transactions. In essence, the Court distinguished clients who share a common legal interest “in a commercial transaction or other common problem but do not reasonably anticipate litigation,” like Bank of America and Countrywide here, from clients that do anticipate litigation or are co-litigants in pending litigation. Id. at 38.

*The author would like to acknowledge the assistance of Nicole M. Finn in the preparation of this submission.