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This article deals with a significant, timely problem facing the legal profession. The problem is significant because the number of malpractice claims filed against attorneys is steadily increasing. The article cites a 2012 American Bar Association study finding more than a 30% increase in the number of claims reported between 2007 and 2011. The problem is also timely because of two 2013 state supreme court decisions. Until recently, the majority view was that if a current outside client threatened its firm with a malpractice claim, the attorney-client privilege did not apply to the consultations between the firm members representing the client and in-house counsel responsible for issues such as ethics and risk management. Thus, in any subsequent malpractice litigation, the former client could discover any written records of the internal consultations and depose firm members about related oral communications. However, on July 10, 2013, the Supreme Judicial Court of Massachusetts decided to recognize an intra-firm privilege; and on the very next day, July 11, 2013, the Georgia Supreme Court arrived at the same conclusion. The thesis of the enclosed article is that the Georgia and Massachusetts courts arguably reached the right result. The first part of this article is descriptive, surveying the current split of authority. The second and third parts are evaluative. The second part addresses the threshold question of whether the courts should recognize an intra-firm privilege in any circumstances. The second part criticizes the majority view and, in particular, challenges traditionalists' reliance on the so-called fiduciary exception to the attorney-client privilege. The third part attempts to identify the circumstances in which the courts ought to uphold an infra-firm privilege. Initially, the third party reviews the internal procedures that the firm ought to put in place to establish its status as the client of the in-house counsel. The third party then turns to the thorny question of whether the firm may engage in such internal consultations even without the outside client's consent. The article suggests that the argument for requiring the client's consent misconceives an evidentiary issues as an ethics question. Given the paucity of authority in point and the recency of the Georgia and Massachusetts decisions, the article does not purport to offer a definitive analysis of these issues. However, legal malpractice claims are so common and the interests of the bar and its clientele are so vital that the current split of authority is unsatisfactory. The intent of this article is to prompt a deeper, more robust debate over these issues.

ssrn electronic journal

Preliminary Thoughts on an Attorney-Client Privilege For Law Firms: When a Current Client Threatens to Sue the Firm for Malpractice, Does the Privilege Apply to the Firm's Consultation with In-House Counsel About the Potential Claim?