On November 2nd, a SEC Administrative Law Judge issued an evidentiary ruling concerning the scope of the attorney-client privilege and the effect of its assertion. During an enforcement hearing the Division of Enforcement (the "Division") objected to a question posed to respondent Carlos J. Ortiz by his counsel as to whether the document that Ortiz used in making a presentation, and the underlying policy described in the document, were reviewed by the legal and compliance department of his employer, who is paying for Ortiz's defense. The Division claims the question was inappropriate because during the pre-hearing investigation, the employer asserted the attorney-client privilege and refused to allow the Division to question any witness about any matter involving their lawyer's review of documents or comments on any documents. Ortiz responds that he is not asserting a reliance-on-counsel defense but that he should have the opportunity to defend himself by showing that before he made any kind of statement or presentation concerning the securities that are the subject of the proceeding he had the underlying information checked by his employer's legal department. The ALJ concludes that the employer's counsel occasionally over-zealously invoked the attorney-client privilege to prevent the Division from exploring how and to what extent the legal department participated in the events at issue. Since the employer prevented the Division from investigating the legal department's involvement issues, the Division is unfairly prejudiced if respondent is allowed to show he consulted the legal department and it allowed or approved use of the materials which are the bases of the allegations. In the Matter of Miguel A. Ferrer and Carlos J. Ortiz, Admin.Proc.Rulings No. 703.