Most people rightly believe and understand that communications with their lawyers are privileged. Like everything else in society, communications between clients and lawyers have gone digital in that clients very frequently communicate with their lawyers through email. Sometimes, employees communicate with their personal attorneys using their employer's computers and email resources. Are those communications, sent through the employer's network, still privileged if the employer expressly reserved the right to review and monitor all communications traversing through its network? An appellate court in California recently held that an employee's communications with her personal attorney were not privileged, because the employer had a well-defined computer use policy that instructed all employees that they had no expectation of privacy in their email communications.
The Case of Gina Holmes.
Gina Holmes was hired by Petrovich Development Company in June 2004. One month later, Holmes informed the company that she was pregnant. Throughout her pregnancy, Holmes felt that some of her colleagues harassed her and created a hostile working environment. Holmes had particular difficulty with the company's principal, Paul Petrovich. Holmes and Petrovich exchanged several emails regarding the dates of Holmes' maternity leave and who would cover her responsibilities while she was out. Petrovich forwarded some of Holmes' emails to other employees within the company, including the company's HR officer and the company's in-house counsel. Holmes, while working from a company computer and using company resources, sent emails to her personal attorney, Joanna Mendoza, seeking advice about a possible discrimination action. Later that day, the attorney, Mendoza, advised Holmes to delete the emails because there was a chance that her employer would access them.
Holmes eventually brought suit against the company and Paul Petrovich alleging sexual discrimination, retaliation, invasion of privacy and infliction of emotional distress. The trial court granted summary judgment to the employer as to the claims of discrimination and retaliation, but the claims of invasion of privacy and infliction of emotional distress persisted and went to a jury trial. The jury ultimately found in the employer's favor. The emails between Holmes and her personal attorney were deemed admissible by the trial court. The trial court relied upon them in dismissing the discrimination and retaliation claims, and the trial court permitted the jury to consider them when deciding the remaining claims.
Holmes appealed, arguing that the emails with her personal counsel, although sent on company computers and using company resources, were privileged communications that should not have been used as evidence.
Petrovich's Computer Use Policies.
The decision favoring Petrovich Development was affirmed because it had a robust and explicit computer use policy, a policy all employers should have. Petrovich's computer use policy expressly stated the following: (1) the computers supplied to the employees should be used for company business only and they should not be used for personal matters; (2) the company would monitor emails, and files sent via email, for compliance with this policy; and (3) employees had no reasonable expectation of privacy because the company would monitor the email traffic.
A word about the attorney-client privilege is necessary to understand the logic of the California court. Not all communications between clients and attorneys are privileged. The key to the attorney-client privilege is that the communications are intended to remain confidential. Therefore, including third parties in the discussion "vitiates" the privilege. If a client and his/her attorney meet for lunch and the client's college roommates sit at the same table, the client cannot reasonably believe that communications with the attorney in that setting are confidential, no matter how sensitive the topic. Therefore, there is some risk that the contents of the lunch discussions will be discovered by an opponent (either by asking the client or the roommates at a deposition). Similarly, emails between a client and an attorney that are forwarded to persons outside the attorney-client relationship transform the communications from privileged to non-privileged.
One could contend that no email between a client and attorney should be privileged, because every email passes through some third party's resources. For example, an email containing legal advice could pass through a dozen or more internet service providers (ISPs) from sender to recipient, each of which could access and read its contents. Courts have held, however, that just because an email passes through a third party's resources, like an ISP's, that does not vitiate the privilege. Therefore, a client can communicate with an attorney by email and those communications can be privileged.
Against this backdrop, the court's ruling in the Holmes case makes sense. Holmes was told explicitly that her employer would monitor her emails and that she had no expectation of privacy in those communications. The court's logic is summarized in one passage of the opinion:
When Holmes e-mailed her attorney, she did not use her home computer to which some unknown persons involved in the delivery, facilitation, or storage may have access. Had she done so, that would have been a privileged communication, unless Holmes allowed others to have access to her e-mails and disclosed their content. Instead, she used defendants' computer, after being expressly advised this was a means that was not private and was accessible by Petrovich, the very person about whom Holmes contacted her lawyer and whom Holmes sued. This is akin to consulting her attorney in one of defendants' conference rooms, in a loud voice, with the door open, yet unreasonably expecting that the conversation overheard by Petrovich would be privileged.
The lesson of the Holmes decision is that without an express policy, Holmes' communications with her attorney may have retained their privileged status. Interestingly, the Holmes court also held that a fax communication between Holmes and her personal attorney was also not privileged, because it too utilized company resources and the written policy extended to communications sent via facsimile. All employers' computer use policies should take into consideration the many modes of communications used by employees, including telephones and faxes.
Many companies have computer use policies, but anecdotal evidence suggests that few companies actually monitor employees' email traffic in the ordinary course. There are several reasons for this. First, employers want their employees to use resources for company business only, but employers recognize that some amount of personal use will occur. Employers want to avoid creating a draconian "big brother" atmosphere, particularly when personal use is minimal and not disruptive to company business. Second, many employers lack the resources to dedicate to monitoring even a sampling of all email traffic coming in and going out of the company.
It is not surprising, then, that Holmes argued that her emails to her lawyer should be privileged because, although Petrovich had a computer use policy, no one at the company actually monitored email traffic. She argued that under those circumstances, she had an expectation of privacy. In other words, she contended that the words of the computer use policy were contradicted by the company's actual practice. The California court rejected this argument. It held that "Absent a company communication to employees explicitly contradicting the company's warning to them that company computers are monitored to make sure employees are not using them to send personal email, it is immaterial that the ‘operational reality' is the company does not actually do so." While it certainly would be better if employers at least sample email communications on a periodic basis, according to the California court that is not necessary in the context of a challenge to the privilege of communications sent on company resources.
A few other recent decisions on this topic shed light on what should be included in computer use policies. In Stengart v. Loving Care Agency, Inc., 990 A.2d 650 (N.J. 2009), the New Jersey Supreme Court held that communications sent by an employee using her work computer to access a web-based Yahoo! email account to communicate with her attorney were still privileged because the employer's computer use policy did not expressly state that the employer would monitor personal email accounts and the policy also expressly permitted "occasional personal use." The Stengart court resolved ambiguity in the policy against the employer and found there to be a reasonable expectation of privacy in the employee's use of a web-based email account. Therefore, a robust computer use policy will expressly address these and other related issues.
The Holmes decision only underscores the utility of a computer use policy. Such a policy should expressly inform employees that they are using company resources, that the company will monitor email communications (and files sent via email), that the policy extends to all forms of communication (such as faxes), and that the employees have no expectation of privacy in their communications. As technology changes, computer use policies must also change.
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