When a former employee of the opposing party offers a California lawyer access to electronic data that supposedly shows the opposing party withheld responsive documents in discovery, what must the lawyer do before taking it?

Plain-English summary

The opinion analyzes a civil trade-secrets case in which a former administrative assistant of an executive at the opposing company contacted the plaintiff's officer, told the officer the opposing party was withholding documents, and offered to share electronic data alleged to be a copy of a folder labeled "Hot Docs" on the opposing company's server. The client asks the lawyer to meet with the witness and take possession of the data.

The committee divides the analysis into four parts. First, the lawyer cannot participate in or counsel a client to engage in criminal conduct under Rules 1.2.1(a) and 8.4(b), (c), and (d). The committee, citing Penal Code sections 496 and 502 as possible reference points without opining on whether a crime occurred, directs the lawyer to investigate how the witness came into possession of the data and to consult with criminal-law counsel under Rule 1.1(c) if the lawyer lacks the competence to evaluate the question. If the lawyer takes possession of evidence of a crime, the lawyer may be ethically obligated to turn it over to the court or law enforcement (People v. Superior Court (Fairbank), 192 Cal.App.3d 32 (1987)).

Second, even if the data was lawfully obtained, the lawyer cannot review confidential or privileged material of the opposing party. The committee analogizes Rule 4.4 (inadvertent receipt of writings the lawyer reasonably should know are privileged or subject to work-product protection) to the situation here: once it is reasonably apparent that the writings include privileged or work-product material, the lawyer must refrain from examining the material beyond the minimum necessary to confirm its protected status, and must promptly notify the holder. The committee agrees with State Bar Formal Opinion 2013-188 that this duty extends to material obtained from a third party where it is reasonably apparent the material was provided without the holder's authorization. The committee distinguishes Aerojet-General v. Transport Indemnity Insurance (1993), in which the receiving lawyer was permitted to use a non-privileged fact (witness identity) learned from a privileged document, while noting that Rico v. Mitsubishi Motors (2007) and the State Fund line of cases now control inadvertent-receipt scenarios.

Third, on communications with the witness, Rule 4.2 does not prohibit contact because the witness is unrepresented and a former employee. Rule 4.3 governs: the lawyer may not state or imply disinterest, and may not seek privileged or confidential information the lawyer knows or reasonably should know the witness may not reveal without violating a duty to another (including the witness's continuing confidentiality duties to the former employer).

Fourth, on the duty to communicate, the lawyer's evaluation of whether the evidence may be lawfully possessed or reviewed is a "significant development" under Rule 1.4 requiring consultation with the client. The committee identifies specific risks that should be discussed: financial impact, legal costs, delay from satellite litigation over the evidence, the possibility of disqualification, loss of chosen counsel, evidence preclusion, and sanctions. Rule 1.4(a)(4) further requires the lawyer to advise the client when the client's expectations exceed what the rules permit.

The committee concludes by directing the lawyer to comply with the Rico line of cases when the materials reasonably appear privileged or subject to work-product protection and are produced without the holder's consent.

In practice

The opinion holds that, under the California rules effective November 1, 2018, a lawyer offered access by an unrepresented former employee of the opposing party to data alleged to show withholding cannot simply accept it. The lawyer's first inquiries are whether possession is lawful, whether taking or reviewing the data would itself be criminal, and whether the data reasonably appears to contain privileged or work-product material. The lawyer's communications with the witness are limited by Rule 4.3. Throughout, the lawyer owes the client a Rule 1.4 duty to discuss the significant risks before taking action.

Common questions

Q: Can a California lawyer accept documents from a former employee of the opposing party who says the opposing party hid them?

A: Per the opinion, not without first analyzing whether possession is lawful, whether accepting or reviewing the documents would itself be criminal, whether the documents include privileged or work-product material, and what risks the client must be advised of under Rule 1.4. The committee does not categorically prohibit acceptance, but identifies multiple ethical screens that must be applied first.

Q: Does Rule 4.2 prohibit talking to a former employee of the opposing party?

A: Per the opinion, no. Rule 4.2 does not apply where the witness is unrepresented and not currently a managing agent of the opposing party. Rule 4.3 governs.

Q: What can the lawyer ask the unrepresented former employee?

A: Per the opinion, the lawyer may ask about the source and general nature of the data, but cannot state or imply disinterest, and cannot seek privileged or other confidential information the witness may not reveal without violating a duty to another, including continuing confidentiality duties to the former employer.

Q: What if the data reasonably appears to be privileged or work-product material?

A: Per the opinion, the lawyer must analogize to Rule 4.4 and refrain from examining the data beyond what is necessary to confirm its protected status, then promptly notify the privilege holder or work-product owner. The committee agrees with State Bar Formal Opinion 2013-188 that this duty applies to third-party transmissions where it is reasonably apparent the material was provided without authorization.

Q: Does the lawyer have a duty to turn over evidence of a crime?

A: Per the opinion, citing People v. Superior Court (Fairbank), if the lawyer takes possession of evidence that was the product of a crime, the lawyer may have a self-executing ethical obligation to turn it over to the court or law enforcement.

Q: Does the lawyer have to consult with the client before taking the data?

A: Per the opinion, yes. The committee treats the evaluation as a significant development under Rule 1.4(a)(3) and requires the lawyer to discuss the foreseeable risks (financial impact, delay, disqualification, evidence preclusion, sanctions) and, under Rule 1.4(a)(4), to advise the client of any rule limitations on the lawyer's ability to do what the client requests.

Background and rules framework

The opinion interprets the post-November-2018 California Rules of Professional Conduct, principally Rules 1.1 (competence), 1.2.1 (advising or assisting violation of law), 1.4 (communication), 4.2 (represented persons), 4.3 (unrepresented persons), 4.4 (respect for rights of third parties), and 8.4 (misconduct). It anchors the privileged-receipt analysis in Rico v. Mitsubishi Motors Co. (2007) and State Comp. Ins. Fund v. WPS, Inc. (1999), and the criminal-conduct analysis in Penal Code sections 496 and 502 and People v. Superior Court (Fairbank) (1987). The opinion expressly carves out whistleblower protections from its analysis (citing Erhart v. BofI Holding (S.D. Cal. 2017)).

Citations and references

Rules of Professional Conduct:

• California Rule 1.0.1 (terminology)
• California Rule 1.1 (competence; consultation with other counsel under 1.1(c))
• California Rule 1.2.1 (no advising or assisting violation of law)
• California Rule 1.4 (communication; significant developments under 1.4(a)(3); rule-limitation advice under 1.4(a)(4))
• California Rule 4.2 (represented persons)
• California Rule 4.3 (unrepresented persons; no implying disinterest; no soliciting protected information)
• California Rule 4.4 (inadvertent writings)
• California Rule 8.4 (misconduct, including (b), (c), (d))

Statutes:

• Bus. & Prof. Code section 6068(a)
• Bus. & Prof. Code section 6106
• Penal Code section 496 (receipt of stolen property)
• Penal Code section 502 (Comprehensive Computer Data Access and Fraud Act)
• Civil Code section 47(b) (litigation privilege)
• Civil Code sections 3426 et seq. (Uniform Trade Secrets Act)
• Code of Civil Procedure section 425.16 (anti-SLAPP)
• Financial Code sections 4050 et seq. (California Financial Information Privacy Act)

Cases:

• Aerojet-General Corp. v. Transport Indemnity Insurance, 18 Cal.App.4th 996 (1993), use of non-privileged facts learned from privileged memo
• Clark v. Superior Court, 196 Cal.App.4th 37 (2011), duty regarding inadvertently produced material
• Conn v. Superior Court, 196 Cal.App.3d 774 (1987), contempt for retention of improperly obtained documents
• In re Plotner, 5 Cal.3d 714 (Cal. 1971), disbarment for receipt of stolen property
• Finton Construction, Inc. v. Bidna & Keys APLC, 238 Cal.App.4th 200 (2015), anti-SLAPP dismissal of claims against attorneys
• McDermott Will & Emery LLP v. Superior Court, 10 Cal.App.5th 1083 (2017), Rico principles
• Nalian Truck Lines, Inc. v. Nakano Warehouse and Transportation Corp., 6 Cal.App.4th 1256 (1992), contact with former employees
• People v. Lee, 3 Cal.App.3d 513 (1970), tangible evidence from third party not privileged
• People v. Meredith, 29 Cal.App.3d 682 (1981), exception to privilege when counsel alters evidence
• People v. Superior Court (Fairbank), 192 Cal.App.3d 32 (1987), self-executing duty to turn over evidence
• Pillsbury Madison & Sutro v. Schechtman, 55 Cal.App.4th 1279 (1997), injunction returning confidential personnel documents
• Rico v. Mitsubishi Motors Co., 42 Cal.4th 807 (Cal. 2007), duty regarding inadvertent privileged material
• Scalzo v. Baker, 185 Cal.App.4th 91 (2010), anti-SLAPP dismissal where attorney received adverse-party credit card records
• Snider v. Superior Court, 113 Cal.App.4th 1187 (2003), no privilege-violating questions
• State Farm Fire & Casualty v. Superior Court, 54 Cal.App.4th 625 (1997), bar on invading privileged communications
• Triple A Machine Shop, Inc. v. State of California, 213 Cal.App.3d 131 (1989), former-employee communications
• Williams v. Superior Court, 81 Cal.App.3d 330 (1978), attorney convicted of concealing stolen property

Other opinions cited:

• Cal. State Bar Formal Opinion 2013-188: duty when third party transmits apparently privileged writing without owner's authorization

Other authorities:

• Restatement (Third) of the Law Governing Lawyers, section 102 (2000)
• Restatement of Employment Law, sections 8.01 et seq.

See also

• LACBA Opinion 529: Social Media Confidentiality and Work Product
• LACBA Opinion 506: Duty to Preserve Former Client's Confidences

Source

• Landing page: https://lacba.org/?pg=ethics-opinions
• Original PDF: https://lacba.org/docDownload/2010555