Intentional or Inadvertent Waiver of Attorney-Client Privilege in SEC Subpoena Response

by Brian Lebrecht on November 28, 2012

In a recent case involving the SEC (SEC v. Welliver,  Civil No. 11-CV-3076 (D. Minn. Ruling October 26, 2012), the court ruled that a party that turned over certain communications between him and his attorney, then later claimed that the communications were covered by the attorney-client privilege, had in fact waived the privilege because the delivery was intentional.  The party tried to argue that the delivery was inadvertent, because the timeline given by the SEC for response to the subpoena was too short and he was rushed.  The court did not agree.  The court applied Federal Rules of Evidence 502, which states:

there is only a waiver if: “(1) the waiver is intentional; 2) the disclosed and undisclosed communications or information concern the same subject matter; and 3) they ought in fairness to be considered together.” It goes on to provide that a disclosure is not a waiver if: “(1) the disclosure is inadvertent; 2) the holder of the privilege . . . took reasonable steps to prevent disclosure; and (3) the holder promptly took reasonable steps to rectify the error . . . ”

The lesson here is to be careful when responding to an SEC subpoena, and if you need more time, ask for it.  This is a further argument in favor of always hiring counsel to represent you in subpoena responses, even if you think they are routine.

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