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Waiver of Corporate Privilege By An Individual Defendant
Individual employees often act pursuant to advice from their in-house counsel. If named as a defendant in which her action is challenged, the employee may want to assert advice of corporate counsel as a defense. But the privilege belongs to the employer, not the employee, and the employer may refuse to waive the privilege. Can the court abrogate the employer's privilege over the objection of the employer, and if so under what circumstances?
Wells Fargo and Ross
In United States v. Wells Fargo Bank, 132 F. Supp. 3d 558 (S.D.N.Y. 2015), and Ross v. City of Memphis, 423 F.3d 596 (6th Cir. 2005), the U.S. District Court for the Southern District of New York and the U.S. Court of Appeals for the Sixth Circuit, respectively, addressed precisely this question, and held that the court could not abrogate the employer's privilege.
Wells Fargo was a False Claims Act action by the Securities and Exchange Commission against Wells Fargo Bank and one of its employees, Kurt Lofrano. Lofrano contended, in substance, that he had consulted with Wells Fargo's counsel about certain of his actions that were at the heart of the lawsuit before he had taken those actions, and had understood that he was permitted to take them. Thus, he claimed, he had a potentially dispositive advice of counsel defense.
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