Litigation

Cal Supremes on Attorney-Client Privilege: Absolute Privilege Means Absolute Privilege

By Bruce Nye

    Here's a new, pro-business decision from the Cal Supremes reinforcing protection of the attorney-client privilege.   In Costco Wholesale Corporation v. Superior Court (Randall) (November 20, 2009) ___Cal.4th___ (S163335), the defendant's in-house counsel had retained an outside firm to interview some employees and provide an opinion on whether certain positions were exempt or non-exempt for wage and hour / overtime purposes.  Making sure Defendant knew it was getting its money's worth, the outside counsel wrote a twenty-two page letter summarizing the investigation and giving opinions. 

    Flash forward several years.  Costco is now involved in a wage and hour case involving -- guess what? -- the question of whether certain positions are exempt or non-exempt.  Plaintiffs seek the letter in discovery.  Costco objects on attorney client privilege grounds.  The trial court appoints a discovery referee to review the document in camera, and teh referee recommends production of a redacted version of the letter.  The redactions leave the fact-based information from the interviewed employees, but black out just about everything else. 

    Trial court adopts referee's recommendations, ordering production of the redacted letter.  Costco appeals.  Court of appeal affirms.  Costco petitions Cal Supremes, who grant review and reverse.

    Say the Supremes:  What part of "absolutely privileged" don't you understand?  Confidential communications from attorney to client are absolutely privileged.  The law makes no distinction between the parts that are "fact based," the parts that are "legal advice" or anything else.  So redaction didn't help -- the entire communication was privileged, regardless of its exact content.

    Furthermore, the entire procedure was improper.  Evidence Code section 915 prohibits a court from ordering in camera disclosure  of an assertedly privileged document for the purpose of ruling on the claimed privilege.  So the trial court had no business ordering the letter produced for review in the first place.

Full post as published by CalBizLit on December 01, 2009 (boomark / email).