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AGENDA Role and status of IHC Privilege vs. professional secrecy Choice of law rule Case examples

PRIVILEGE: BASICS In US, privilege attaches for Communications Image courtesy of Stuart Miles at FreeDigitalPhotos.net In US, privilege attaches for Communications Between privileged persons Made in confidence To obtain or provide legal advice. Restatement (Third) of the Law of Governing Lawyers § 68

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Scene 1 Bribery at French Sub of US parent Global Co. US Parent Landry French Sub. In the vignette, there are allegations of bribery in the French subsidiary of a US parent company.

WHO SHOULD LEAD THE INVESTIGATION? First… Identify potential forum(s) Understand the following information for each jurisdiction: Status and role of in-house counsel Privilege vs. professional secrecy and scope of protection Whether protection applies to communications between foreign in-house counsel and employees

ROLE & STATUS OF IHC In the vignette… United States: Image courtesy of digitalart at FreeDigitalPhotos.net ROLE & STATUS OF IHC In the vignette… United States: IHC are members of bar Privilege available France (and some other countries): IHC are not on the list of “avocats” Neither legal privilege nor professional secrecy apply to IHC US: Upjohn v. U.S., 449 US 383 (1981) France: Article 2, Règlement intérieur national EU: Akzo Nobel Chemicals Ltd. v. Comm’n, Case C-550/70P (2010)

PRIVILEGE VS. PROF’L SECRECY Image courtesy of Stuart Miles at FreeDigitalPhotos.net Civil law countries Varies by country Professional secrecy/Confidentiality Scope of protection depends on the jurisdiction… Common law countries Privilege, offers evidentiary protection Attaches when elements are met, but may be waived Anwar v. Fairfield Greenwich Ltd, 2013 WL 3369084, No. 09 Civ. 118 (S.D.N.Y. July 8, 2013)

Gucci America, Inc. v. Guess?, Inc., CHOICE OF LAW RULE IN THE U.S. Gucci America, Inc. v. Guess?, Inc., ISSUE: Were communications of US in-house and Italian in-house counsel privileged? Touch base test? Considerations of comity? Apply chosen law… HOLDING… 271 F.R.D. 58 (S.D.N.Y.2010)

A PRIVILEGE STRATEGY? In the vignette… Two possible forums under anti-bribery laws… France: Article 433-1 of Crim. Code US: FCPA? Can affect strategy in preserving privilege Image courtesy of KROMKRATHOG at FreeDigitalPhotos.net

ASSIGNING RESPONSIBILITIES French outside counsel? French in-house counsel? US outside counsel? US in-house counsel? Who should conduct investigation? ABA Model Rule 5.5: cannot practice in violation of jurisdiction’s regulation

A NOTE ON FUNCTIONAL EQUIVALENCE A 1982 case says YES: Renfield Corp. v. E. Remy Martin & Co., S.A., 98 F.R.D. 442 (D. Del. 1982) The test for attorney-client privilege “is a functional one of whether the individual is competent to render legal advice and is permitted by law to do so” However, Renfield has not been followed: Honeywell, Inc. v. Minolta Camera Co., Ltd., 1990 WL 66182 (D.N.J. 1990) Finding that the Third Circuit has not applied the functional equivalence rationale and that the individual in question was not a de facto attorney. Bristol-Myers Squibb Co. v. Rhone-Poulenc Rorer, Inc., 188 F.R.D. 189 (S.D.N.Y. 1999) Holding that no privilege extended to files of French industrial property agents. Anwar v. Fairfield Greenwich Ltd, 2013 WL 3369084, No. 09 Civ. 118 (S.D.N.Y. July 8, 2013) Holding that no privilege extended to Dutch in-house who was unlicensed.

TIPS FOR PROTECTING PRIVILEGE Consider all forums involved. Evaluate strategic use of local and US counsel. Circulate documents on a “need to know” basis. Train employees on document circulation. Ensure in-house lawyers are licensed somewhere. Circulate reference sheet of the “role & status”, “privilege vs. prof’l secrecy/confidentiality” and choice of law rules for your key jurisdictions. Investigations – prepare documents, expecting sharing. Transactions – avoid litigation in unfavorable forum Consider broadening choice-of-law provisions to include privilege selections.

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