In BSP Software, LLC v. Motio, Inc., No. 12 C 2100 (N.D. Ill. July 9, 2013), the court held that a company’s disclosure of privileged materials to an advisory board waived the privilege. At the time of the disclosures, plaintiff did not have a formal board of directors, but instead assembled an advisory board. It was undisputed that the role of the advisory board was to “impart business and financial advice,” and that the advisory board had no “binding authority” over the company. Plaintiff argued that the advisory board members should be treated as the “functional equivalent” of company employees, thus allowing disclosure without waiver. The court rejected plaintiff’s argument. First, the court criticized the “functional equivalent” doctrine, observing that applying the doctrine is necessarily fact-intensive, and would lead to uncertainty regarding the application of the attorney-client privilege to disclosures to non-employees, and could expand the privilege by “eroding the circumstances in which it can be waived.” The court stated that it was doubtful that the Seventh Circuit would endorse the doctrine, “which has the potential to expand the privilege dramatically and thus would run contrary to the Seventh Circuit’s frequent admonition that the scope of the privilege must be carefully circumscribed.” The court then went on to hold that, even if the doctrine were applicable, plaintiff failed to meet the functional equivalent test as applied by other jurisdictions.