New Rule 502 to Protect Against Privilege Waiver

Due to the skyrocketing cost of producing electronically stored information in litigation, the U.S. Senate unanimously passed without amendment Senate Bill S. 2450 in February. If, as expected, the bill is approved by the House of Representatives, the long-anticipated new Federal Rule of Evidence 502 should take effect on Dec. 1.

Proposed Rule 502 is intended to reduce the staggering costs of document and ESI review by protecting against waiver of the attorney-client privilege and work-product immunity. The legislation would apply to proceedings commenced after the effective date and, "insofar as is just and practicable," to all proceedings pending on that date -- obviously including many current lawsuits.

In what now is likely its final form, Rule 502 seeks to protect against forfeiting a privilege when disclosure in a federal action is the result of an innocent mistake. The rule also would enforce often-agreed-upon court orders permitting procedures like the so-called "quick peek" that allows requesting parties to assess the producing party's ESI before more definitively delineating the scope of production, and "claw-backs" allowing the return of inadvertent disclosures without claim of waiver.

By way of background, in 2006, House Judiciary Committee Chairman James Sensenbrenner, R-Wis. -- concerned about rising costs associated with ESI -- suggested that the Judicial Conference of the United States consider proposing to Congress a rule dealing with waiver of attorney-client privilege and work-product. Unlike rules of civil procedure, rules governing evidentiary privilege must be approved by an act of Congress pursuant to the Rules Enabling Act, 28 U.S.C. 2074(b).

The Advisory Committee on Evidence Rules accordingly prepared drafts that were revised after testimony from a select group of judges, lawyers and academics, and again revised after two days of public testimony and the consideration of more than 70 written submissions from groups including defense and plaintiffs' lawyers, corporate counsel, the American Bar Association and even prisoners. In late 2007, the Advisory Committee provided its final draft, concluding that the current law on waiver of privilege and work-product is largely responsible for the rising costs of discovery, especially discovery of ESI. The Standing Committee on Rules of Practice and Procedure and the Judicial Conference itself approved the text, which then was introduced as a bill by senators Arlen Specter, R-Pa., and Patrick Leahy, D-Vt.

In complex litigation, lawyers spend significant time in efforts to preserve work-product and the attorney-client privilege because they know that, under existing law in some jurisdictions, if one protected document is produced -- even inadvertently -- there is a risk that a court may find a subject-matter waiver. Subject-matter waiver means that attorney-client privileged communications and work-product are considered waived not only as to the disclosure at issue but as to all related material -- and not only in that instant case, but in all other cases.

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Source: law.com
By: Alvin F. Lindsay