Are Government Investigation Disclosures Protected Under the Common Interest Doctrine?

Several risks flow from such disclosures by counsel. As an initial matter, counsel may feel pressure to provide an assessment that is rosier or simply more definitive than the law or facts known to counsel at the time of the disclosure support. The dangers associated with disclosure are exacerbated by the risk of discovery — either in subsequent civil litigation, or even during the very criminal investigation about which counsel is disclosing information. The government might go to a counterparty and try to find out what counsel for the subject company did and did not say about the facts and likelihood of liability.

This article discusses whether disclosures made under these circumstances are protected from discovery on the basis of the attorney-client privilege and pursuant to the common interest doctrine. We begin with a discussion of a leading decision in the Second Circuit, Schaeffler v. United States, 806 F.3d 34 (2d Cir. 2015), and then turn to an important application of Schaeffler by Judge Jed Rakoff in Carnegie Inst. of Washington v. Pure Grown Diamonds, 481 F. Supp. 3d 276 (S.D.N.Y. 2020). We conclude by considering the inherent risks from disclosure that remain under applicable case law.