Attorney-Client Privilege Within the Corporation - Who is Covered?

Following a recent Ethics CLE Seminar hosted by the Firm, a number of audience members inquired about the scope of the attorney-client privilege within a corporation. Generally, the extent of the privilege will depend on whether the jurisdiction at issue follows the “control group” or “subject matter” theory of corporate attorney-client privilege. A minority of states still follow the “control group” test, under which the privilege is limited to communications with employees in a position to take substantial part in the ultimate decision the corporation may take upon the advice of counsel. Under this test, the privilege is limited to top management personnel.

Missouri, however, follows the more liberal “subject matter” theory of corporate attorney-client privilege. In Missouri, the leading case on this issue remains DeLaporte v. Robey Bldg. Supply, Inc., 812 S.W.2d 526 (Mo. Ct. App. 1991). In DeLaporte, Judge Simon borrowed liberally from the Eighth Circuit on the subject of the corporate attorney-client privilege, stating: “The privilege covers counsel's communications with both top management and lower level employees. The lower level employees are covered if:

1. the communication was made for the purpose of securing legal advice;
2. the employee making the communication did so at the direction of his corporate superior;
3. the superior made the request so that the corporation could secure legal advice;
4. the subject matter of the communication is within the scope of the employee's corporate duties; and
5. the communication is not disseminated beyond those persons who, because of the corporate structure, need to know its contents.”

Missouri courts have also extended the privilege to the officers and employees of holding, subsidiary, and affiliate companies. For a detailed discussion of that issue, see State ex rel. Syntex Agri-Bus., Inc. v. Adolf, 700 S.W.2d 886, 888 (Mo. Ct. App. 1985).

In communicating with corporate officers and employees, however, corporate counsel should remember that the attorney-client privilege will only attach to those communications whose primary purpose is legal, rather than business, advice. For a discussion of the difficult issues that arise in determining the primary purpose of the communication in the context of electronic communications, see In re Vioxx Products Liab. Litig., 501 F. Supp. 2d 789, 796 (E.D. La. 2007).

For additional information, please contact Matthew J. Aplington at (314) 641-5121 or maplington@stolarlaw.com.