Law.com Subscribers SAVE 30%

Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.

Commercial LawFeaturesKickerLJN NewslettersNewsRegulationSectionsThe Corporate CounselorTopics

How Privileged Are Your Privileged Communications?

BY Richard B. Kapnick, Courtney A. Rosen
April 02, 2014

The applicability of the attorney-client privilege within the corporate setting has been firmly established for decades. However, corporate counsel may be surprised to learn that, under certain circumstances, plaintiffs in shareholder litigation have gained access to privileged materials upon a showing of “good cause” under the fiduciary exception. This article discusses the basis for the fiduciary exception, the factors involved in the good-cause analysis, and the circumstances under which courts have turned over privileged materials to plaintiffs.

Garner and the Applicability of the Fiduciary Exception

The fiduciary exception to the attorney-client privilege was first recognized in Garner v. Wolfinbarger, 430 F.2d 1093 (5th Cir. 1970). Garner involved a shareholder derivative action alleging fraud by corporate management and a direct action alleging fraud and violations of securities laws. Shareholders sought discovery of communications between corporate management and corporate counsel, and the corporation asserted the attorney-client privilege. Although these communications were privileged, the court allowed plaintiffs access to them, holding that in the context of a derivative action, shareholders and corporate managers have a mutual interest in relevant communications because of the fiduciary duty owed by the corporation to its shareholders. While the court noted that allowing plaintiffs access to privileged documents could leave management open to second-guessing and harassment, it emphasized that “management does not manage for itself and that the beneficiaries of its action are the stockholders.” Id. at 1101.

This premium content is locked for Entertainment Law & Finance subscribers only

  • Stay current on the latest information, rulings, regulations, and trends
  • Includes practical, must-have information on copyrights, royalties, AI, and more
  • Tap into expert guidance from top entertainment lawyers and experts

For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473

Read These Next
Yachts, Jets, Horses & Hooch: Specialized Commercial Leasing Models Image

Defining commercial real estate asset class is essentially a property explaining how it identifies — not necessarily what its original intention was or what others think it ought to be. This article discusses, from a general issue-spot and contextual analysis perspective, how lawyers ought to think about specialized leasing formats and the regulatory backdrops that may inform what the documentation needs to contain for compliance purposes.

Hyperlinked Documents: The Latest e-Discovery Challenge Image

As courts and discovery experts debate whether hyperlinked content should be treated the same as traditional attachments, legal practitioners are grappling with the technical and legal complexities of collecting, analyzing and reviewing these documents in real-world cases.

Identifying Your Practice's Differentiator Image

How to Convey Your Merits In a Way That Earns Trust, Clients and Distinctions Just as no two individuals have the exact same face, no two lawyers practice in their respective fields or serve clients in the exact same way. Think of this as a "Unique Value Proposition." Internal consideration about what you uniquely bring to your clients, colleagues, firm and industry can provide untold benefits for your law practice.

Risks and Ad Fraud Protection In Digital Advertising Image

The ever-evolving digital marketing landscape, coupled with the industry-wide adoption of programmatic advertising, poses a significant threat to the effectiveness and integrity of digital advertising campaigns. This article explores various risks to digital advertising from pixel stuffing and ad stacking to domain spoofing and bots. It will also explore what should be done to ensure ad fraud protection and improve effectiveness.

Turning Business Development Plans Into Reality Image

This article offers practical insights and best practices to navigate the path from roadmap to rainmaking, ensuring your business development efforts are not just sporadic bursts of activity, but an integrated part of your daily success.