“Wherein he hath been of counsel, it is ordered he shall not be compelled by subpoena or otherwise to be examined” – Dennis v Codrington (1580).
This English admonition five centuries ago is one of the first articulations of what, over time, has come to be known as the attorney-client privilege. Until recently in the US, a client’s right to speak in confidence to an attorney had been virtually inviolate. This principle was reaffirmed in 1980 by US Chief Justice William Rehnquist in Upjohn v United States, in which his decision held that the attorney-client privilege applied not only to individuals, but to corporate entities as well.
Erosion of the privilege
With such respected authority, one would think the attorney-client privilege safe and sound, yet in the US today this is not the case. To the contrary, there has been a determined effort by the US Department of Justice (DoJ) to erode this privilege. The present assault is focused in particular on the corporate attorney-client privilege. Upjohn notwithstanding, this attack has serious consequences for individuals and corporations.
The origin of this assault is found in DoJ memoranda, the operative one in January 2003 by then Deputy Attorney-General Larry Thompson. Known colloquially as the ‘Thompson Memo’, this writing sets forth various criteria for prosecutorial consideration in determining whether a corporation should be charged with alleged wrongful acts. These factors are generally not controversial, with one exception – that which speaks in terms of ‘cooperation’. The controversy relates to the government position that a waiver of the attorney-client privilege is a key component of cooperation with the government. On one hand, the Thompson Memo somewhat benignly states that waiver is not “an absolute requirement and is only to be sought if necessary”, yet reading further, the true message is unmistakable: failure to cooperate “should weigh in favour of corporate prosecution”. Moreover, the various US attorneys around the country (there are 93 of them) over whom the DoJ exercises oversight have recently been given discretion to determine individually what constitutes the ambiguous ‘if necessary’ criteria.
The DoJ professes that waivers of the attorney-client privilege are voluntary and requested only occasionally. The US Securities and Exchange Commission followed the DoJ’s lead recently when its enforcement director stated that such waiver requests are not made as “a matter of course”. While formal requests may be limited, any such numbers are meaningless when governmental culture maintains that waiver equates to cooperation and non-waiver to a non-cooperator, with the veiled draconian suggestion of adverse consequences should waiver not occur. Clearly, waivers under these circumstances cannot be voluntary, but are inherently coercive.
A distinguished group of four former attorney-generals, acting in tandem with several other former high-level department officials, recently stated that the threat of being labelled a non-waiving entity, and thus “uncooperative”, has significant potential for adverse consequences. Further, this statement asserts that “even if… unfounded, the charge of non-cooperation can have… profound effect on a company’s public image, stock price and creditworthiness [such] that companies generally yield to waiver demands”.
Many federal prosecutors have interpreted the government policy so that they now virtually demand that a corporation use its resources not only to conduct a thorough investigation, but to provide the fruits of such efforts to it. It is not unusual for federal prosecutors to expect the production of witness statements, attorneys’ impressions of witnesses and core attorney-client privileged communications, as well as attorney work product.
Side by side with such governmental action is the misguided view that those who do not waive the privilege decline because there is something to hide. Such reasoning not only flies in the face of five centuries of support for this privilege, but also in the face of respected US legal authority, which recognises that negative inferences based on invocation of the attorney-client privilege cannot be drawn or otherwise inferred in a criminal context.
The privilege is not, as some prosecutors now see it, an obstructionist tactic. Most attorneys behave honourably and those who counsel or participate in criminal conduct are subject to the crime-fraud exception to the attorney-client privilege, which exists to challenge attorney communications that aid a client to commit a crime.
An inevitable consequence of the privilege erosion has been a transformation of the lawyer effectively into an agent of the government – a role never intended of private counsel. That is, the attorney in such a situation is no longer a confidential counsellor to their client, but someone acting effectively as a deputised governmental agent with legal skills used to funnel information gleaned from a client to the government for whatever use the government may deem appropriate. This grotesque result turns the role of attorneys upside down.
Help in the offing
A taskforce of the American Bar Association (ABA), perhaps the largest organisation of lawyers in the world, undertook a study, which was followed by recommendations to stem the privilege erosion in August 2005. It passed a resolution stating: “The ABA opposes the routine practice by government officials of seeking to obtain a waiver of the attorney-client or work product doctrine through the granting or denial of any benefit or advantage.”
A unique coalition has been formed, including prominently the US Chamber of Commerce and the American Civil Liberties Union – organisations not normally aligned. These groups have joined with others in a determined effort to restore the privilege to its rightful position.
One should not, however, conclude that waiver of the attorney-client privilege and cooperation with the government should always be avoided. Indeed, there are occasions when it may very much be in the client’s interest to waive the privilege, but when any such waiver occurs it should be a voluntary decision made by lawyer and client, and not as a result of coercion through government pressure. When coercions occur, the sanctity of the privilege is destroyed and the justice system as a whole diminished.
Notwithstanding growing discontent, the government’s assault on the attorney-client privilege continues. In short, in the US today, the attorney-client privilege is in jeopardy.
Stephen Grafman is a partner in the Washington DC office of Kirkpatrick & Lockhart Nicholson Graham