Use Of Inadvertently Disclosed Discovery Does Not Mandate Disqualification

The Washington State Court of Appeals Division Three affirmed a conclusion that use of inadvertently disclosed electronic discovery did not require disqualification of counsel

Electronically stored information is ubiquitous in contemporary law practice. When an attorney responds to a discovery request by sending electronically stored information to opposing counsel, care must be taken to avoid inadvertent disclosure of embedded information that might be subject to a claim of privilege. Nevertheless, if an inadvertent disclosure happens, the receiving attorney must take corrective action, including notifying the sender. Sanctions must be imposed if an attorney fails to take corrective action, with the most severe sanction being disqualification.

Counsel for Lloyd & Williams, LLC, and its members, Dewight Hall Jr. and Tod W. Wilmoth (collectively L&W), inadvertently disclosed information subject to a claim of privilege when it sent electronic discovery responses to opposing counsel that had been partially redacted but not scrubbed of embedded text. Instead of notifying counsel for L&W and sequestering the documents, opposing counsel cited portions of the embedded text in support of a summary judgment motion. This prompted L&W to move for opposing counsel’s disqualification.

The failure of opposing counsel to take corrective action violated rules of civil procedure and professional conduct. Nevertheless, the trial court ruled disqualification was not an appropriate sanction because counsel’s rule violations were not intentional. Having accepted discretionary review of this matter, we find no abuse of discretion in the trial court’s choice of sanction. Accordingly, we affirm.

The story

Patty Hur is embroiled in a contract dispute with L&W. Responding to a discovery request, L&W’s lawyer, George Ahrend, sent more than 1,000 pages of e-mails to Ms. Hur’s lawyer, Heidi Urness. The discovery was sent electronically and was accompanied by a notice stating privileged information had been redacted. Mr. Ahrend later explained he redacted the purportedly privileged e-mails by blacking out the substantive content, leaving the header information (i.e., date, sender, recipient, and subject) visible in lieu of
a privilege log.

More than one year after receipt of the discovery responses, Ms. Hur moved for partial summary judgment. Attached to Ms. Hur’s declaration in support of the motion were two exhibits taken from Mr. Ahrend’s discovery materials. The exhibits are screenshots, and each image has a left-hand column and a right-hand column. The left-hand columns display the results of keyword searches. The search results are sentence fragments containing the search terms “Maggie” and “rent,”  accompanied by a denotation of how many “matches” had been found in the searched documents. Clerk’s Papers (CP) at 71-74. Alongside each set of search results, in the images’ right-hand columns, appears a visual of e-mail headers followed by completely blacked out text.

Mr. Ahrend reviewed Ms. Hur’s summary judgment submissions and recognized the e-mail fragments as content he had intended to redact. Upon further investigation, Mr. Ahrend discovered his attempt at redaction had been only partially successful. Although portions of the discovery had been blacked out, the metadata3 associated with the redacted portions had not been removed from the documents produced. As a result, the content of the blacked-out text was discoverable upon performing a word search of the document.

L&W moved to disqualify Ms. Urness from the case, alleging her receipt and retention of privileged materials violated ethical and discovery court rules. Ms. Urness denied any wrongdoing. She provided various explanations for her conduct, including assertions that she did not understand metadata and that she had received at least some of the information from a third party. Ms. Urness also argued the e-mails were not privileged and that they revealed L&W had engaged in its own ethical violations by withholding information and making misstatements to the court.  Ms. Urness was adamant she had not tried to uncover privileged information, but had simply performed a word search of the discovery materials.

The court considered both civil and ethics rules

Taken together, these rules require a recipient of inadvertently disclosed information subject to a claim of privilege to notify the sender and either return, sequester, or destroy the materials. Under CR 26(b)(6), the attorney can share the materials with the court in camera if privilege is disputed. But until the issue of privilege is resolved, the attorney should not disclose the materials to others, including the public by way of a nonconfidential court filing.

L&W contends Ms. Urness violated the foregoing rules by reading its privileged e-mails. This is incorrect. The rules do not prohibit a lawyer from reading inadvertently disclosed information that is subject to a claim of privilege. The only proscription is of the failure to take corrective action.

L&W also claims Ms. Urness somehow purposefully “looked behind the redactions” to view privileged materials. Pet’rs’ Opening Br. at 20. Had this occurred, it would have been a significant ethical breach. See Wash. State Bar Ass’n (WSBA) Rules of Prof’l Conduct Comm., Advisory Op. 2216 (2012). But the record does not support L&W’s claim. When Mr. Ahrend’s office produced the discovery responses, his staff advised Ms. Urness that information subject to a claim of privilege had been redacted. Proper redaction means taking reasonable steps to prevent disclosure of confidential metadata.

The court found that the use violated the rules but that disqualification was not required in light of the relevant factors

Our court has identified four factors trial courts must consider in determining whether disqualification is an appropriate remedy for an attorney’s access to privileged information: (1) prejudice, (2) counsel’s fault, (3) counsel’s knowledge of the claim of privilege, and (4) the possibility of lesser sanctions.

The trial court properly exercised its discretion

We affirm the trial court’s order denying L&W’s motion for disqualification. This disposition is without prejudice to any future case developments. For example, Ms. Urness represented to this court during oral argument that the only redacted materials she accessed were the two e-mail excerpts referenced in Ms. Hur’s motion for summary judgment. Wash. Court of Appeals oral argument, supra, at 24 min., 45 sec. to 25 min., 10 sec. We expect that, as a licensed attorney, Ms. Urness’s representation to this court was truthful. In the unlikely event this was not the case, a new motion for sanctions may be appropriate.

(Mike Frisch)