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Communication is everywhere, all of the time. It’s true both in our personal lives and in the working hours in between. As the corporate world continues to embrace the remote office, an ever-expanding amount of that corporate interaction is done in writing through chat apps or the now ubiquitous video conference.

When a company is looking for legal advice, that ease and distributed nature of communication puts the enterprise’s ability to keep its conversations with counsel confidential. Directors can join board meetings from anywhere through Zoom – perhaps within earshot of their (non-director) family members. Executives and counsel can trade messages on Teams, only to have to collect, log and, just maybe, produce them in discovery during a lawsuit.

So when can a company count on keeping its conversations with counsel – no matter the medium – confidential? Now more than ever is time for a primer on the attorney-client privilege in the modern business world.

The Basics

It’s best to start with the basics. In general, a company’s communications with counsel are privileged if counsel is giving legal advice in their capacity as counsel and the participants took steps to protect the conversation from anyone who shouldn’t be hearing or reading it. If these are all true, privilege applies to the conversations necessary for giving legal advice, formulating a legal strategy, and the substance of the advice itself.

In other words, counsel doesn’t necessarily have to be giving legal advice in order for something to be protected from disclosure under the privilege, but the thrust of the conversation should concern some legal (as opposed to a purely business) issue at the company. To add to that, the lawyer should be speaking in their position as a lawyer, rather than as, say, the corporate secretary.

For example, we’ve seen meeting minutes where the board of directors, with its general counsel present, discussed paying a dividend before moving to an agenda item to discuss ongoing litigation. The conversation about the litigation was entirely protected from disclosure in discovery, while the discussion as to the dividend was only protected to the extent that the general counsel gave advice as to the legal requirements for declaring the dividend – but not the size of the dividend or whether it made sense, business wise, to declare it.

And remember, these are just the basics, and one straightforward example. With most legal standards, there are wrinkles and exceptions. As lawyers often say, it all depends on the situation, and that’s particularly true for the attorney-client privilege.

Privileged or Confidential – What’s the Difference?

Two terms we often hear when talking about protecting a company’s conversations with counsel are privileged and confidential. The terms don’t overlap. Information can be privileged and confidential, neither, or one or the other. But what’s the difference?

In short, privilege speaks to whether a communication has to be disclosed in any legal proceeding. If a company’s conversation with counsel is privileged, and the company doesn’t do something to waive that privilege – like, say, forwarding the Slack chat or email to a vendor the company is negotiating with – neither the company nor the lawyer can be forced to disclose the communication.

Confidentiality in the legal context is broader than privilege, but in some ways has less teeth. It generally refers to any type of information a company or individual would want to keep from being disseminated publicly, or outside of a specific group.

Let’s use an example. Say a company’s board of directors holds a meeting and discusses a potential merger but doesn’t seek or receive any legal advice from the corporate lawyer who’s present for the conversation. Let’s further say that, during this hypothetical board meeting, the directors ask the lawyer to keep the conversation confidential – perhaps because the discussions with the company’s merger partner are covered by a non-disclosure agreement.

Here, counsel’s ethical obligations would prevent them from disclosing the communication to anyone without the company’s permission, but that doesn’t mean the company could prevent the substance of the conversation from being disclosed during discovery in a later lawsuit. In this scenario, the court could require disclosure of the information, most likely under a confidentiality order.

These types of orders typically allow disclosure only to a limited and defined set of people, usually the attorneys and the parties, who could only use the information for the purpose of the lawsuit. In some cases, where the confidential information is particularly sensitive – non-public pricing data, for example – the court will order that the information can only be disclosed to outside counsel. But, at the end of the day, the confidential information is still disclosed outside of the company.

Practical Steps to Keep Conversations Private

These standards suggest some practical steps to make sure a company’s private conversations with counsel – no matter the medium – stay that way.

• Make sure sensitive communications over video conference or the phone are actually private. Take calls in a room with the door closed. Use a headset. Always turn on the waiting room and require a robust, dynamic password to log-in to a video conference. If you’re conducting a phone conference, it’s best to use a service that displays the information for everyone who’s on the call, so the company can avoid someone calling in without being detected.
• Reserve chats with counsel for logistical things like scheduling a meeting. Get on the phone or a video call with counsel to discuss sensitive matters.
• Every writing exchanged with a lawyer has the risk of being disclosed, whether in a lawsuit or otherwise. Demand outside counsel adhere to robust cybersecurity protocols to protect email traffic and other electronically stored documents. Keep notes of conversations with counsel secure. If using a cloud-based notetaking service, make sure to use two-factor authentication, preferably a third-party authenticator app rather than a text-based security code.

If you’re interested in learning more, please contact Steven Aquino at Steven@bevilacquapllc.com or (202) 793-3576. You can also reach us at our general information email at info@bevilacquapllc.com.