August 22, 2007
Use Of Report Waives Privilege
The Sandia Corporation retained outside counsel (a law professor) to conduct an investigation of allegations by two internal ethics officers "that their work was being impeded and they were being retaliated against by Sandia managers." The attorney generated a 221 page report that identified several employees whose conduct "merited scrutiny." One of the identified employees was disciplined, terminated her employment and sued Sandia, claiming the report was a sham that had falsely accused her of misconduct.
A New Mexico district court held that Sandia's use of the report in the litigation waived the attorney-client and work product privileges and ordered additional disclosures. On appeal, the New Mexico Court of Appeals upheld the distirct court's order of additional disclosures as to communications between the outside lawyer and Sandia representatives aa well as work product materials provided to Sandia. However, the order to disclose "all materials prepared or compiled by [the outside lawyer]" was reversed as to work product that was not provided to Sandia. (Mike Frisch)
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