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Communication to Your Public Relations Firm Privileged or Not?

A company executive wakes up one morning and routinely checks his email on his smartphone. Fresh in the inbox is a news report containing complaints about his company’s products. Almost out of habit, the executive clicks “forward,” sending the negative news story to his lawyer and his public relations (PR) firm with the note “This looks bad, let’s get going on damage control.” Before he’s even had time to finish his morning coffee, this executive may have just created Exhibit A in future litigation.

When a legal crisis hits, a corporate executive’s first call should be exclusively to his company lawyer. In the era of the 24-hour news cycle and instant communication, though, the first call is often to a PR consultant. Where attorneys and PR firms merely work for the same client, however, communications between the PR firm and attorneys may not be protected by the attorney-client privilege. The privilege may be available if either: 1) the PR firm is an independent contractor hired by the law firm to assist it in the provision of legal services; or 2) the PR firm is the functional equivalent of an employee of the client. Additionally, the usual elements of the privilege must all be met. In the alternative, even where the attorney-client privilege does not apply, work product immunity may shield documents prepared in anticipation of litigation. Courts have been cautious about an unwarranted blurring of the lines between legal and PR consultation in extending the attorney-client privilege. As one court succinctly put it, “[a] media campaign is not a litigation strategy.”1 Accordingly, companies and their legal representatives should be careful in their communications with attorneys and PR firms where confidentiality is of the essence.

The Oldest Privilege in Our Law

The attorney-client privilege is the oldest privilege in American common law jurisprudence.2 As recognized by the United States Supreme Court, the purpose of the privilege “is to encourage full and frank communication between attorneys and their clients and thereby promote broader public interests in the observance of law and administration of justice.”3 On the other hand, courts recognize the tension between the goals served by the privilege and the truth-seeking function of the judicial system.4

Though there are minor variations according to each state’s laws, the privilege generally requires that the communications be: 1) between a client or potential client and attorney or their representatives; 2) made confidentially; and 3) for the purpose of facilitating the rendition of professional legal services.5 Substance trumps labels: Simply copying an attorney on a communication or marking it “attorney-client privileged” will not be sufficient to make the communication privileged, but rather the elements must be met. Likewise, a party cannot conceal facts otherwise subject to discovery merely by revealing them to its lawyer.6

How to Classify the PR Firm

In many cases, the first step for deciding whether communication with a PR firm can be privileged is to classify the role of the PR firm. There are generally two categories of PR entities for which the courts have said the attorney-client privilege might apply: 1) If the PR firm is acting as a contractor assisting the attorney; or 2) If the PR consultant is the functional equivalent of an employee of the company hiring the attorney. Once it is determined that attorney-client privilege is possible because of the role of the PR consultant or firm, the general test for attorney-client privilege articulated above must be met.

The PR Firm as a Contractor to the Attorney

As a general matter, attorney-client privilege extends not just to communication with the attorney but to representatives employed to assist the attorney in the provision of legal services such as paralegals, law clerks, or legal secretaries.7

Merely because an outside contractor assists an attorney, however, does not necessarily mean such communications will be privileged. The Second Circuit Court of Appeals, for instance, has refused to extend privilege to communications between corporate in-house counsel and an outside tax advisor, which is analogous to a PR firm.8 The court found the purposes of the privilege were not served in that instance, noting that “the privilege protects communications between a client and an attorney, not communications that prove important to an attorney’s legal advice to a client.”9 Thus, it is not enough that the assistance of another party is merely helpful to the attorney; that party must be necessary to the provision of legal assistance.

How can a PR firm ever be necessary to the provision of legal assistance? In this regard, the PR firm as a contractor to the attorney may have only extremely limited applicability. One case where this approach was successfully applied was In re Grand Jury Subpoenas.10 There, the Southern District of New York applied the attorney-client privilege to communications with a PR firm hired by a law firm to consult regarding the case of “Target.” The court never revealed the Target’s name in the opinion, but later rulings showed her to be Martha Stewart. The case is unique because the attorneys made the legal decision that the unbalanced press coverage was detrimental to their client’s legal position because of a “clear risk that the prosecutors and regulators conducting the various investigations would feel public pressure to bring some kind of charge.”11 The court concluded that the attorney-client privilege would apply, although observing that “Target would not have enjoyed any privilege for her own communications with [the PR firm] if she had hired Firm directly, even if her object in doing so had been purely to affect her legal affectation.”12 In the context of the firm’s use of the PR firm, though, the court concluded the attorneys were assisting in performing “some of their most fundamental client functions.”13 Thus, the court found the PR firm to be assisting in the provision of legal services.

The PR Firm as an Employee of the Company

More often, courts focus more on the role of the PR firm in relation to the client. The Eighth Circuit Court of Appeals has held that attorney-client privilege can be extended to third parties where the third parties are the “functional equivalent” of employees.14

In its Bieter decision, the Eighth Circuit considered an independent contractor who had a long-time relationship with a partnership, worked in the partnership’s office, consulted for a monthly fee, and acted as the partnership’s representative in various contexts. The court held there was “no principled basis to distinguish [the contractor’s] role from that of an employee, and his involvement in the subject of the litigation makes him precisely the sort of person with whom a lawyer would wish to confer confidentially in order to understand [the partnership’s] reasons for seeking representation […]. As we understand the record, he was in all relevant respects the functional equivalent of an employee.”15

Numerous courts have followed this “functional equivalent” approach.16 A recent decision on the subject, A.H. v. Evenflo Co., applied the functional equivalent test and found communications between an attorney and a PR firm protected by the attorney-client privilege.17 There, the company had retained a public relations firm to provide public relations consultation relating to a product recall. The PR firm collaborated with the company’s counsel to prepare a communications plan regarding the recall, including drafting correspondence to the National Highway Traffic Safety Administration, a press release, and other communications to the general public. The PR firm received input from the company’s employees and counsel regarding the drafting of the communications.

Relying on a decision from the Southern District of New York, the court identified three factors that would tend to show that the consultant is the functional equivalent of an employee:

1) whether the consultant had primary responsibility for a key corporate job;

2) whether there was a continuous and close working relationship between the consultant and the company’s principals on matters critical to the company’s position in litigation; and

3) whether the consultant is likely to possess information possessed by no one else at the company.18

The court held that “confidential communications between a party’s counsel and a non-testifying expert or consultant, hired in anticipation of litigation, are protected by the attorney-client privilege.”19 The court further noted that the company in question did not have an internal public relations department and that the Colorado Supreme Court had cited with approval a New York case where an outside PR firm was found to be the “functional equivalent” of an in-house public relations department.20 The court reviewed the documents in question and concluded they were “predominantly legal” in nature and that the PR firm consultants were essentially acting as company employees.21

The Role of Work Product Immunity

Even if a document is not subject to attorney-client privilege, it still may be shielded from discovery if it qualifies for work-product immunity. The attorney-client privilege and work-product immunity are often confused. The two are distinct bars to discovery, with different tests for the application of each. Even if not found protected by attorney-client privilege, documents concerning communications between an attorney and a PR firm may be found protected by the work-product doctrine.

Work-product immunity provides protection for “documents and tangible things that are prepared in anticipation of litigation or for trial by or for another party or its representative.”22 The work-product doctrine is “distinct from and broader than the attorney-client privilege.”23 “While the attorney-client privilege protects only confidential communications, the work product doctrine generally protects from disclosure documents prepared by or for an attorney in anticipation of litigation.”24 The anticipation of litigation must be a reasonable one and generally requires a specific, identifiable claim or threat of litigation.25

This doctrine, however, does not provide the same level of protection as the attorney-client privilege. Work product evidence is discoverable “upon a showing that the party seeking discovery has substantial need of the materials [….] and that the party is unable without undue hardship to obtain the substantial equivalent of the materials by other means.”26

Several courts have found work-product immunity to apply to PR communications not protected by the attorney-client privilege. In Calvin Klein Trademark, the court declined to apply attorney-client privilege but nevertheless found some of the publicist-draft documents qualified as work product.27 The court cautioned, however, that the scope of the immunity would not extend outside the conduct of the litigation “because the purpose of the rule is to provide a zone of privacy for strategizing about the conduct of litigation itself, not for strategizing about the effects of the litigation on the client’s customers, the media, or on the public generally.”28 In the Vioxx multidistrict litigation, the court did not address attorney-client privilege because it found an investigative report made by a PR consultant to be protected work product.29 The court noted that “[w]hile the Martin Report may also have been motivated by business purposes such as creating positive media coverage, any potentially alternative motivation cannot be considered primary in light of the prospective Vioxx litigation.”30 Rather, the “primary motivating purpose” of Martin’s investigation was to “aid in possible future litigation.”31 Yet, in Amway Corp v. The Procter & Gamble Co., the court sustained privilege claims for only a handful of public relations-related documents.32 It concluded the remainder were not protected because “on their face [the rejected documents] reflect intense public relations activity,” and though they sometimes discussed pending or anticipated litigation, “the context of the comments is related to public relations, not legal matters.”33

Conclusion

The attorney-client privilege is endangered when the lines are blurred between PR work and legal work. Accordingly, clients should carefully delineate the scope of communications between the attorneys they hire and the PR firms they hire. Attorneys must recognize that just because they are attorneys does not mean that their advice is always protected: If attorneys


[i] Haugh v. Schroder Inv. Mgmt. N. Am., Inc., No. 02-civ- 7955 2003 U.S. Dist. LEXIS 14586, 9-10 (S.D.N.Y. Aug. 25, 2003) (holding documents protected by work product privilege but not attorney-client privilege and observing that “[s]ome attorneys may feel it is desirable at times to conduct a media campaign, but that decision does not transform their coordination of a campaign into legal advice.”

[ii] Upjohn Co. v. United States, 449 U.S. 383, 389 (1981).

[iii] Id.

[iv] United States v. BDO Seidman, LLP, 492 F.3d 806, 815 (7th Cir. 2007) (citing United States v. Frederick, 182 F.3d 496, 500 (7th Cir. 1999)). Because “[t]he cost of these benefits is the withholding of relevant information from the courts,” BDO Seidman, 492 F.3d at 815, the Seventh Circuit has stressed that “the privilege is in derogation of the search for the truth and, therefore, must be strictly confined.” In re Grand Jury Proceedings, 220 F.3d 568, 571 (7th Cir. 2000); see also Univ. of Pa. v. EEOC, 493 U.S. 182, 189 (1990) (expressing reluctance, because testimonial and evidentiary privileges impede the search for truth, to recognize a testimonial or evidentiary privilege “unless it ‘promotes sufficiently important interests to outweigh the need for probative evidence…’”) (quoting Trammel v. United States, 445 U.S. 40, 51 (1980)).

[v] 3-503 Weinstein’s Federal Evidence § 503.10. In a federal court civil case based on diversity of jurisdiction, state law will govern the applicability of the privilege. Fed. R. Evid. 501.

[vi] See Upjohn Co., 449 U.S. at 395-396.

[vii] 3-503 Weinstein’s Federal Evidence § 503.12.

[viii] United States v. Ackert, 169 F.3d 136, 139 (2d Cir. 1999).

[ix] Id. (citing Fisher v. United States, 425 U.S. 391, 403 (1976)).

[x] 265 F. Supp. 2d 321 (S.D.N.Y. 2003).

[xi] Id. at 323 (quoting witness affidavit).

[xii] Id. at 331.

[xiii] Id. at 330.

[xiv] In re Bieter Co., 16 F.3d 929, 930 (8th Cir. 1994).

[xv] Id. at 938.

[xvi] In re Copper Market Antitrust Litig, 200 F.R.D. 213, 218-19 (S.D.N.Y. 2001) (public relations consultant who consulted with the company’s counsel regarding a pending investigation was the functional equivalent of an employee pursuant to federal common law).

[xvii] A.H. v. Evenflo Co., No. 10-cv-02435, 2012 U.S. Dist. LEXIS 76100 (D. Colo. May 31, 2012) (citing Horton v. United States, 204 F.R.D. 670, 672 (D. Colo. 2002), which required a “detailed factual showing” that the third party is the “functional equivalent” of an employee).

[xviii] Id. (quoting Export-Import Bank v. Asia Pulp & Paper Co., Ltd., 232 F.R.D. 103, 113 (S.D.N.Y. 2005)) (citing LG Electronics U.S.A., Inc. v. Whirlpool Corp., 661 F. Supp. 2d 958, 962 (N.D. Ill. 2009) (adopting the functional equivalent test).

[xix] Evenflo, (citing W. Res. v. Union Pac. R.R. Co., 00-20430CM, 2002 U.S. Dist. LEXIS 1911, 2002 WL 181494, at *7 (D. Kan. Jan. 31, 2002); Fru-Con Constr. Corp. v. Sacramento Mun. Utility Dist., S-05-0583 LKK GGH, 2006 U.S. Dist. LEXIS 59066, 2006 WL 2255538 (E.D. Cal. Aug. 7, 2006); In re Grand Jury Subpoenas, 179 F.Supp.2d 270, 283 (S.D.N.Y. 2001)).

[xx] Id. (citing Alliance Constr. Solutions, Inc., 54 P.3d at 868-869).

[xxi] Id.

[xxii] Fed. R. Civ. P. 26(b)(3).

[xxiii] United States v. Nobles, 422 U.S. 225, 238, 95 S. Ct. 2160, 45 L. Ed. 2d 141 (1975).

[xxiv] Reg’l Airport Auth. of Louisville v. LFG, LLC, 460 F.3d 697, 713 (6th Cir. 2006).

[xxv] Schmidt, Long & Assocs. v. Aetna U.S. Healthcare, Inc., Civ. A. No. 00-CV-3683, 2001 U.S. Dist. LEXIS 7145, at *13 (E.D. Pa. May 31, 2001).

[xxvi] Fed R. Civ. P. 26(b)(3).

[xxvii] Calvin Klein Trademark Trust v. Wachner et al., 198 F.R.D. 53, 55 (S.D.N.Y. 2000).

[xxviii] Id.

[xxix] In re Vioxx Prods. Liab. Litig., MDL No. 1657, 2007 U.S. Dist. LEXIS 23164, *11 n.3 (E.D. La. Mar. 5, 2007).

[xxx] Id.

[xxxi] Id.

[xxxii] 2001 U.S. Dist. LEXIS 4561 at *21 (W.D. Mich. Apr. 3, 2001).

[xxxiii] Id.

Finis

Citations

  1. Haugh v. Schroder Inv. Mgmt. N. Am., Inc., No. 02-civ- 7955 2003 U.S. Dist. LEXIS 14586, 9-10 (S.D.N.Y. Aug. 25, 2003) (holding documents protected by work product privilege but not attorney-client privilege and observing that “[s]ome attorneys may feel it is desirable at times to conduct a media campaign, but that decision does not transform their coordination of a campaign into legal advice.” Jump back to footnote 1 in the text
  2. Upjohn Co. v. United States, 449 U.S. 383, 389 (1981). Jump back to footnote 2 in the text
  3. Id. Jump back to footnote 3 in the text
  4. United States v. BDO Seidman, LLP, 492 F.3d 806, 815 (7th Cir. 2007) (citing United States v. Frederick, 182 F.3d 496, 500 (7th Cir. 1999)). Because “[t]he cost of these benefits is the withholding of relevant information from the courts,” BDO Seidman, 492 F.3d at 815, the Seventh Circuit has stressed that “the privilege is in derogation of the search for the truth and, therefore, must be strictly confined.” In re Grand Jury Proceedings, 220 F.3d 568, 571 (7th Cir. 2000); see also Univ. of Pa. v. EEOC, 493 U.S. 182, 189 (1990) (expressing reluctance, because testimonial and evidentiary privileges impede the search for truth, to recognize a testimonial or evidentiary privilege “unless it ‘promotes sufficiently important interests to outweigh the need for probative evidence…’”) (quoting Trammel v. United States, 445 U.S. 40, 51 (1980)). Jump back to footnote 4 in the text
  5. 3-503 Weinstein’s Federal Evidence § 503.10. In a federal court civil case based on diversity of jurisdiction, state law will govern the applicability of the privilege. Fed. R. Evid. 501. Jump back to footnote 5 in the text
  6. See Upjohn Co., 449 U.S. at 395-396. Jump back to footnote 6 in the text
  7. 3-503 Weinstein’s Federal Evidence § 503.12. Jump back to footnote 7 in the text
  8. United States v. Ackert, 169 F.3d 136, 139 (2d Cir. 1999). Jump back to footnote 8 in the text
  9. Id. (citing Fisher v. United States, 425 U.S. 391, 403 (1976)). Jump back to footnote 9 in the text
  10. 265 F. Supp. 2d 321 (S.D.N.Y. 2003). Jump back to footnote 10 in the text
  11. Id. at 323 (quoting witness affidavit). Jump back to footnote 11 in the text
  12. Id. at 331. Jump back to footnote 12 in the text
  13. Id. at 330. Jump back to footnote 13 in the text
  14. In re Bieter Co., 16 F.3d 929, 930 (8th Cir. 1994). Jump back to footnote 14 in the text
  15. Id. at 938. Jump back to footnote 15 in the text
  16. In re Copper Market Antitrust Litig, 200 F.R.D. 213, 218-19 (S.D.N.Y. 2001) (public relations consultant who consulted with the company’s counsel regarding a pending investigation was the functional equivalent of an employee pursuant to federal common law). Jump back to footnote 16 in the text
  17. A.H. v. Evenflo Co., No. 10-cv-02435, 2012 U.S. Dist. LEXIS 76100 (D. Colo. May 31, 2012) (citing Horton v. United States, 204 F.R.D. 670, 672 (D. Colo. 2002), which required a “detailed factual showing” that the third party is the “functional equivalent” of an employee) Jump back to footnote 17 in the text
  18. Id. (quoting Export-Import Bank v. Asia Pulp & Paper Co., Ltd., 232 F.R.D. 103, 113 (S.D.N.Y. 2005)) (citing LG Electronics U.S.A., Inc. v. Whirlpool Corp., 661 F. Supp. 2d 958, 962 (N.D. Ill. 2009) (adopting the functional equivalent test). Jump back to footnote 18 in the text
  19. Evenflo, (citing W. Res. v. Union Pac. R.R. Co., 00-20430CM, 2002 U.S. Dist. LEXIS 1911, 2002 WL 181494, at *7 (D. Kan. Jan. 31, 2002); Fru-Con Constr. Corp. v. Sacramento Mun. Utility Dist., S-05-0583 LKK GGH, 2006 U.S. Dist. LEXIS 59066, 2006 WL 2255538 (E.D. Cal. Aug. 7, 2006); In re Grand Jury Subpoenas, 179 F.Supp.2d 270, 283 (S.D.N.Y. 2001)). Jump back to footnote 19 in the text
  20. Id. (citing Alliance Constr. Solutions, Inc., 54 P.3d at 868-869). Jump back to footnote 20 in the text
  21. Id. Jump back to footnote 21 in the text
  22. Fed. R. Civ. P. 26(b)(3). Jump back to footnote 22 in the text
  23. United States v. Nobles, 422 U.S. 225, 238, 95 S. Ct. 2160, 45 L. Ed. 2d 141 (1975). Jump back to footnote 23 in the text
  24. Reg’l Airport Auth. of Louisville v. LFG, LLC, 460 F.3d 697, 713 (6th Cir. 2006). Jump back to footnote 24 in the text
  25. Schmidt, Long & Assocs. v. Aetna U.S. Healthcare, Inc., Civ. A. No. 00-CV-3683, 2001 U.S. Dist. LEXIS 7145, at *13 (E.D. Pa. May 31, 2001). Jump back to footnote 25 in the text
  26. Fed R. Civ. P. 26(b)(3). Jump back to footnote 26 in the text
  27. Calvin Klein Trademark Trust v. Wachner et al., 198 F.R.D. 53, 55 (S.D.N.Y. 2000). Jump back to footnote 27 in the text
  28. Id. Jump back to footnote 28 in the text
  29. In re Vioxx Prods. Liab. Litig., MDL No. 1657, 2007 U.S. Dist. LEXIS 23164, *11 n.3 (E.D. La. Mar. 5, 2007). Jump back to footnote 29 in the text
  30. Id. Jump back to footnote 30 in the text
  31. Id. Jump back to footnote 31 in the text
  32. 2001 U.S. Dist. LEXIS 4561 at *21 (W.D. Mich. Apr. 3, 2001). Jump back to footnote 32 in the text
  33. Id. Jump back to footnote 33 in the text