Next to a person’s Fifth Amendment right to remain silent, the attorney-client privilege is probably the most well recognized legal doctrine out there. Nevertheless, there are many nuances surrounding the privilege about which even seasoned lawyers are not very familiar. One of these deals with the fact that not all private communication between an attorney and client are privileged – even when the communications involve the most confidential and sensitive information.

In order to understand why and how to handle situations where an attorney-client communication may not be privileged, let’s first look at the basics: the attorney-client privilege is a rule of law that protects from disclosure private communications between an attorney and client that are for the purpose of giving or receiving legal advice. As such, communications with an attorney that seek business advice are not privileged. Further, because so many in-house attorneys routinely provide both business and legal advice, it is critically important that they educate their business colleagues about this, or problems can arise.

Take this example, which really happened to one of my in-house clients a few years ago. As a meeting amongst a group of business executives was about to begin, the CEO announced to everyone in the room that:

Because our in-house counsel, Tony, is here, everything is privileged, and we don’t have to worry about anything we say.

Tony knew this wasn’t true, but he was not in a position, politically, to contradict his CEO in front of the group of executives. As a result, some of the executives had a false sense of security and disclosed things that would have been better left unsaid. Further, because those disclosures were not privileged, Tony had become a potential witness who could have to testify as to what he recalled being said at that meeting.

Another common scenario that can lead to problems is where business people get in the habit of copying in-house counsel on every internal email they send, assuming (or hoping) that this will make the email privileged. Again, unless the email is for the purpose of seeking legal advice, copying in-house counsel (or even outside counsel) does not make that email privileged. Indeed, the only certainty that copying an attorney on an email ensures is that if litigation ensues, there will be another data file that your IT people will have to check for responsive documents.

While some people take the position that copying counsel on important emails and having them at important meetings at least gives the company a chance to claim that the communications are privileged, don’t make the mistake of thinking that there is no downside risk in doing this. In B. F. G. of Illinois, Inc. v. Ameritech Corp., the Northern District of Illinois actually sanctioned a party because it “used in-house counsel to apply a veneer of privilege to non-privileged business communications.”

The attorney-client privilege serves a vital role in our legal system. In order to ensure that companies benefit from the privilege and do not take on unintended risks, it is important for in-house counsel to make sure that they and their business clients have more than a cursory understanding of how it works.