A Southern District Of New York Decision Adopts Narrow Views Of Privilege Protection For Independent Contractors And Lawyer-Retained Consultants: Part I
Not all recent Southern District of New York decisions have favored privilege protection in the corporate setting. In Church & Dwight Co. v. SPD Swiss Precision Diagnostics, GmbH, No. 14-cv-585, 2014 U.S. Dist. LEXIS 175552 (S.D.N.Y. Dec. 19, 2014), the court dealt with two issues that frequently arise in the corporate context: (1) the "functional equivalent" doctrine, and (2) privilege protection for communications with outside consultants on whom lawyers rely in giving legal advice.
The "functional equivalent" doctrine treats as corporate employees for privilege purposes non-employees who are the "functional equivalent" of full-time employees. In this era of outsourcing, one can easily imagine the disruption corporations would face if the privilege did not protect communications with, or in the presence of, temporary secretaries or long-time outsourced contractors who report every day to the company just as employees do. Since first articulated by the Eighth Circuit in In re Bieter, 16 F.3d 929, 933-34 (8th Cir. 1994), the "functional equivalent" doctrine has spread throughout the country, and only a few courts have questioned it. However, the Church &...
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