Tuesday, April 16, 2024

Clawback Saves Privilege Waiver

Two points of ethics interest in a decision issued today by the New Jersey Supreme Court are summarized below

5. The emails between Valley and its general counsel for the purpose of legal advice, rather than business purposes, are protected by the attorney-client privilege. Valley did not place its general counsel’s pre-litigation legal advice “in-issue,” nor did it call its general counsel as a witness. Valley’s inadvertent disclosure of the emails -- allegedly consisting of 352 pages -- in the course of an exchange of about 57,000 documents in roughly two months did not amount to waiver of the attorney-client privilege. The parties’ discovery agreement’s claw-back provision anticipated precisely such an inadvertence. And admission of the emails into evidence was not harmless. Select emails in many ways became the centerpiece of plaintiffs’ case. On remand, if plaintiffs attempt to introduce emails from the batch Valley attempted to claw back, the judge should conduct a document-by-document review to determine whether the emails are privileged and thus not admissible. (pp. 52-58)

6. Certain comments by plaintiffs’ trial counsel in summation were improper. Plaintiffs’ trial counsel knew that Valley had evidence of sixty cases of patient transfers. The summation remarks implied, however, that there was evidence of only two cases of patient transfers, and that inaccurate statement impacted Valley’s contention that it made a valid healthcare decision. (pp. 58-61)

The case

In this appeal, The Valley Hospital (Valley) challenges a jury verdict in favor of a group of eleven neurosurgeons and their practice group, Comprehensive Neurosurgical, P.C., d/b/a/ North Jersey Brain & Spine Center (collectively, plaintiffs). A jury awarded plaintiffs $24,300,000 in damages based on their claim that Valley did not deal with them fairly or act in good faith when it granted another group of neurosurgeons exclusive privileges in areas for which plaintiffs had held privileges.

The court ordered a new trial. (Mike Frisch)


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