Be Wary of How You Use Your Opponent's Privileged Documents

Imagine you are a litigator and, after reviewing thousands of documents, you find an email that looks like advice being given to your opponent, by one of their own lawyers.  Before celebrating, take heed, when international law firm Gibson, Dunn & Crutcher LLP (Gibson Dunn) was placed in this very position, its actions led to its complete disqualification in McDermott Will & Emery, LLP v. The Superior Court of Orange County, No. G053623 (Cal. Ct. App. Apr. 18, 2017).

The issue started in 2013, as a trust dispute.  At the time, the trust, trustee, and some of the beneficiaries were represented by the law firm McDermott Will & Emery LLP (McDermott).  During informal settlement discussions between the trustee and beneficiaries, the Trustee’s attorney (not McDermott) sent him an email outlining a meeting he attended and providing legal advice on how to move forward.

The trustee, who was nearly 80 years old and suffered from multiple sclerosis, accidentally forwarded this email to a friend, who subsequently forwarded it to others.  Over the succeeding 2 years, the trustee and beneficiaries litigated their dispute in probate court.  While the email surfaced during the probate action, the probate attorneys agreed not to use the email as it was potentially privileged.  

Then, in 2015, the beneficiaries filed multiple malpractice lawsuits against McDermott alleging that simultaneously representing the trust, the trustees, and the beneficiaries was an improper conflict.  Gibson Dunn was hired to defend McDermott. 

During discovery, Gibson Dunn found the 2013 email, produced it to the plaintiffs, and subsequently used it during several depositions.  When the trustee claimed that Gibson Dunn had violated the trustee’s privilege and their ethical responsibilities, both the trial court and appellate court agreed.

The Court of Appeals first decided that the privilege was not waived because the email was forwarded out accidentally and without the trustee’s knowledge.  The subsequent dissemination of the email also did not waive privilege, since the privilege belonged to the trustee alone, and anyone who later forwarded it, did not have the authority to waive that privilege.

The Court then turned to Gibson Dunn’s actions and held that Gibson had a duty to notify the trustee as soon as it discovered the document and had reason to believe that it may be privileged.  This duty existed even if Gibson legitimately believed that the privilege had been waived. 

By failing to immediately disclose its possession of the email, and then by going a step further and using the email in depositions, Gibson's actions could have undermined the public trust and confidence in the integrity of the judicial process. 

As a result, Gibson Dunn was disqualified from the case.

The Take-Away: Make sure to be upfront if you think you have inadvertently received a potentially privileged document.  If you honestly believe the privilege has been waived, get a judge to make a determination before using the document in the litigation.