Discovery; Attorney-Client Privilege; Work-Product Doctrine
BouSamra v. Excela Health, 167 A.3d 728 (Pa. Super. 2017), allocatur granted Jan. 30, 2018, appeal docket 5 WAP 2018
The issues here arise from a discovery order requiring Excela to produce prelitigation emails between Timothy Fedele, Excela’s Senior Vice–President and General Counsel, and Ms. Cate, Excela’s outside public relations consultant. The Superior Court summarized the relevant facts related to the discovery order as follows:
On February 25, 2011, Ms. Cate was told by Excela that legal issues prevented public disclosure of the names of the doctors who implanted unnecessary stents. On February 26, 2011, outside counsel transmitted advice to Mr. Fedele by means of an email. On February 26, 2011, Mr. Fedele forwarded that email to Ms. Cate and management level employees at Excela. Ms. Cate forwarded Mr. Fedele’s email, which included in its chain the email authored by outside counsel, to the other three members of the Jarrard team. On February 28, 2011, Excela told Ms. Cate that, at the press conference planned for March 2, 2011, Dr. BouSamra and Dr. Morcos would be publicly named as the cardiologists who over-stented.
Slip Op., at 8.
In response to discovery, Excela provided a privilege log referencing the “Jarrard Documents” – including the February 26, 2011 email from Mr. Fedele to Ms. Cate and various management level Excela personnel, various emails generated among the members of the Jarrard team, and an email Ms. Cate sent to a management level executive at Excela and copied to Mr. Fedele.
Bousamra filed a motion to compel Excela to produce the Jarrard documents. In response, Excela asserted that both the attorney-client and the work-product privileges applied. Bousamra responded that the attorney-client and work-product privileges with respect to the Jarrard documents was improper because Excela waived any privilege when Mr. Fedele forwarded outside counsel’s email to Ms. Cate, a third party. The special master conducted an in camera review of the emails and concluded that the February 26, 2011 email from outside counsel to Mr. Fedele was subject to the attorney-client privilege. The special master did not discuss the work-product privilege.
Bousamra filed exceptions to the special master’s ruling. After in camera review of the emails, the trial court concluded that attorney-client privilege was waived when Mr. Fedele sent outside counsel’s email to Ms. Cate, a third party. Specifically, the trial court reasoned that the exception extending attorney-client privilege to third party communications when the third party is “acting as an agent of a lawyer is facilitating the lawyer’s representation” did not apply when the third parties were not agents of defendant’s counsel, but were retained by Excela to assist in public relations matters. Slip Op., at 10.
Excela appealed, presenting the following issues for consideration by the Superior Court:
(1) Does attorney-client privilege apply to a company’s email with its media consultants, if the emails contain the advice of outside counsel and seek feedback so that in-house counsel may give legal advice to the company CEO on the appropriate course of action?
(2) Does the work product doctrine protect the mental impressions of outside counsel contained in the email?
The court first noted that Jarrard was not empowered to act on behalf of and bind Excela, therefore the Jarrard Documents were not entitled to attorney-client privilege pursuant to the Superior Court’s rulings in Yocabet v. UPMC Presbyterian, 119 A.3d 1012 (Pa.Super. 2015) and Red Vision Sys., Inc. v. Nat’l Real Estate Info. Servs., L.P., 108 A.3d 54 (Pa.Super. 2015). The court turned its attention to Excela’s reliance on United States v. Kovel, 296 F.2d 918 (2nd Cir. 1961). In Kovel, the Second Circuit found communications between a client and accountant were subject to the attorney-client privilege, analogizing the situation to the use of a foreign language interpreter:
Accounting concepts are a foreign language to some lawyers in almost all cases, and to almost all lawyers in some cases. Hence the presence of an accountant, whether hired by the lawyer or by the client, while the client is relating a complicated tax story to the lawyer, ought not destroy the privilege, any more than would that of the linguist . . . of the foreign language theme discussed above; the presence of the accountant is necessary, or at least highly useful, for the effective consultation between the client and the lawyer which the privilege is designed to permit. By the same token, if the lawyer has directed the client, either in the specific case or generally, to tell his story in the first instance to an accountant engaged by the lawyer, who is then to interpret it so that the lawyer may better give legal advice, communications by the client reasonably related to that purpose ought fall within the privilege.
Slip Op., at 14-15 (quoting Kovel, 296 F.2d at 922).
Therefore, the court explained:
Pursuant to Kovel, the attorney-client privilege attaches to an agent of the client in two instances: where the presence of that agent is necessary or, at the very least, useful for purposes of the lawyer’s dissemination of legal advice or where the lawyer directed the client to contact the agent so that the lawyer could give better legal advice.
Slip Op., at 17.
After conducting its own in camera review of the Jarrard Documents, the Superior Court found Kovel’s reasoning inapplicable when Mr. Fedele’s email to Jarrard “was not designed to gain Jarrard’s assistance in providing legal advice to the company” or “to solicit advice from Jarrard so that counsel could advise Excela on the legal risks associated with the content of the public disclosure” and Jarrard did not provide input on the question. Slip Op., at 18. Based on this reasoning, the Superior Court did not need to address, as a matter of first impression, whether the attorney-client privilege in Pennsylvania should be expanded to encompass outside agents of the client under the reasoning employed in Kovel. Furthermore, because Jarrard was not treated as the functional equivalent of one of Excela’s employees or of its public relations department, by sending outside counsel’s email to Jarrard, a third party, Excela was not protected from waiver of the attorney-client privilege applicable to the Jarrard documents.
The court further found that the work-product privilege did not apply to the February 26, 2011 email sent by outside counsel to Mr. Fedele, explaining:
Outside counsel, the lawyer, did not use the email to aid him/her in preparing for litigation by disclosing its contents to a third party or witness. Outside counsel would not have waived his privilege in his own work product if he had given it to Jarrard to aid outside counsel in preparing this case for trial. That did not occur in this case. The client sent the email, and the email was not sent by Excela to Jarrard to help outside counsel in preparing a case for trial.
Slip Op., at 33.
The Pennsylvania Supreme Court granted allocatur on the following issues:
(1) Did the Superior Court commit an error of law when holding that a client waives the work-product protection of its counsel’s pre-litigation e-mail by forwarding the e-mail to its public relations consultant?
(2) Did the Superior Court commit an error of law when holding that, to qualify as a privileged person within the attorney-client privilege, a third party must provide legal advice and have the lawyer or client control its work?