The authority to waive the attorney-client privilege on behalf of a corporation belongs only to the officers and directors of that organization.
The plaintiff, Glenn Hedden, was the former athletic director of Kean University who was terminated as a result of an allegation of failing to properly supervise subordinates in the athletic program. In connection with that termination, the plaintiff ultimately filed a complaint against Kean University in which he alleged wrongful termination in violation of the Conscientious Employee Protection Act, N.J.S.A. 34:19-1 to -14 (CEPA), and that he was terminated for reporting rule violations concerning the women’s basketball team to the National Collegiate Athletic Association (NCAA). During discovery in the plaintiff’s CEPA litigation, the plaintiff requested the production of an email that had been sent by the head coach of the women’s basketball team to the University’s general counsel regarding a draft of a fundraising correspondence which sought donations for a summer trip to Spain for the women’s basketball team. The team’s trip to Spain had ultimately been the subject of an NCAA investigation during which the subject matter email had been produced by the coach of the women’s basketball team, through her personal counsel, to the NCAA. In the plaintiff’s subsequent CEPA litigation, the defendant withheld the previously produced email, arguing it was an attorney-client privileged communication between the coach and the University’s general counsel due to the fact that the coach had sought an attorney’s review of the draft fundraising correspondence as the purpose of forwarding the document to the University’s general counsel. The plaintiff responded by arguing that any such privilege, even if applicable, would have been waived by the coach’s disclosure of the email to the NCAA during its prior investigation. The motion judge ruled that the coach would have waived any attorney-client privilege as a result of her disclosure of the document to the NCAA. On appeal, the Appellate Division overturned that ruling, holding that the head coach of the woman’s basketball team did not have the authority to waive the attorney-client privilege on behalf of the University because she was not an officer or director of the University. Relying upon Commodity Futures Trading Co. v. Weintraub, 471 U.S. 343, 348, 105 S. Ct. 1986, 1991, 85 L. Ed. 2d 372, 378 (1985) and United States v. Doe, 219 F.3d 175, 184-85 (2d Cir. 2000), the Appellate Division held that the group of individuals who may waive the attorney-client privilege on behalf of an organizational client is restricted to those who manage or control its activities. The court also held that, the fact that the University had not voiced an objection at the time of the prior disclosure to the NCAA, or otherwise taken affirmative steps to reverse the coach’s unilateral disclosure action, did not defeat the assertion of the privilege by the true holder of the attorney-client privilege.
Case Law Alert, 1st Quarter 2014