Burch & Cracchiolo, P.A. v. The Honorable Robert D. Myers, __Ariz. Adv. Rep. ___ No. 1 CA-SA 15-0013 (App. Div. I, June 4, 2015) (J. Jones)
ATTORNEY CLIENT PRIVILEGE NOT WAIVED REGARDING INADVERTENTLY DISCLOSED DOCUMENTS BY VIRTUE OF PARTY BRINGING MOTION TO DISQUALIFY ATTORNEY INADVERTENTLY RECEIVING DOCUMENTS
Petitioner brought an action against the real party in interest [Bradford] seeking the establishment of a guardianship. During the course of the litigation Bradford's an attorney who had represented Bradford in an earlier conservatorship proceeding produced documents to petitioners in response to a subpoena duces tecum, mistakenly thinking petitioner was undertaking to represent Bradford. Once this error was discovered, petitioner was informed of the inadvertent disclosure and that certain documents produced were protected by the attorney client privilege. Petitioners thereafter disclosed all the documents to other parties in the lawsuit. and Bradford then filed a motion to disqualify petitioners as counsel in the case submitting the claimed privileged documents in camera in support of the motion. The trial court granted this motion and the petitioner than brought this special action. The Arizona Court of Appeals accepted jurisdiction and denied petitioner the relief sought.
Arizona Rule of Civil Procedure 26.1(f)(2) provides that when a party is notified that privileged documents have inadvertently been disclosed to it, it “must promptly return, sequester, or destroy the specified information and any copies it has made and may not use or disclose the information until the claim is resolved.” Similarly, Ariz. R. Sup. Ct. ER 4.4. provides, the party must “promptly notify the sender and preserve the status quo for a reasonable period of time in order to permit the sender to take protective measures.”
In order to determine if there has been an implied waiver of the attorney client privilege the court examines
(1) [whether the] assertion of the privilege was a result of some affirmative act, such as filing suit, by the asserting party;
(2) [whether] through this affirmative act, the asserting party put the protected information at issue by making it relevant to the case; and
(3) [whether] application of the privilege would have denied the opposing party access to information vital to his defense.
The court of appeals found that reliance upon privileged documents in support of a motion to disqualify counsel for violation of Rule 26.1(f) does not place the documents at issue in the case and does not constitute an implied waiver. In deciding the motion itself the court must evaluate
(1) whether the motion is being made for the purposes of harassing the [opposing party],
(2) whether the party bringing the motion will be damaged in some way if the motion is not granted,
(3) whether there are any alternative solutions, or is the proposed solution the least damaging possible under the circumstances, and
(4) whether the possibility of public suspicion will outweigh any benefits that might accrue due to continued representation.
In conclusion the court of appeals found that when faced
with a motion to disqualify premised upon the abuse of privileged information disclosed Inadvertently, the trial court must:
(1) determine whether the documents at issue are in fact privileged;
(2) determine whether the receiving party exercised an unfair advantage over the documents, such as reviewing, copying, or distributing them in violation of Rule 26.1(f)(2) and ER 4.4(b); and
(3) review the privileged information objectively, in light of the context of the case, to determine whether the receiving party possibly gained an unfair tactical advantage over the moving party.
In reviewing the information, the court may consider certain mitigating factors, such as whether the privilege d information might have already been known by the receiving party, [a]nd because
disqualification motions are disfavored, the trial court should always consider alternative solutions that will adequately address the purported harm. (Citations omitted).