Communications between a public relations firm and a law firm can be protected under the attorney-client privilege when the attorneys hire the PR firm to assist in providing legal advice to clients. ABA Section of Litigation leaders recognize that jurisdictions are split on this issue, however, and caution practitioners to be careful when engaging and communicating with public relations firms.
May 14, 2019 Top Story
Court Extends Privilege to Public Relations Firm
Communications with third-party PR firm protected by attorney-client privilege
By Benjamin E. Long
Counsel Hires PR Firm to Assist with Litigation
In Stardock Systems, Inc. v. Reiche, the U.S. District Court for the Northern District of California analyzed a discovery dispute in an intellectual property rights lawsuit. The case involved questions of ownership and other rights over a video game developed in the early 1990s. The discovery issue arose when the defendants filed a motion to quash a subpoena from the plaintiff that sought all communication among two of the defendants, a public relations firm, and the defendants’ counsel.
The defendants claimed that shortly before the lawsuit started, the plaintiff made hundreds of online posts on forums and social media that were damaging to the defendants. The defendants believed those posts were made to sway public opinion in the plaintiff’s favor and to pressure the defendants to give up their rights in the video game and settle the litigation. The defendants claimed they had hired the public relations firm to provide advice on legal strategy for things like initial pleadings and other communications to address allegedly false statements being made by the plaintiff. The plaintiff contended that the communications related directly the claims in the litigation and were not privileged.
The court cited In re Grand Jury Subpoenas from the U.S. District Court for the Southern District of New York, which held that “(1) confidential communications (2) between lawyers and public relation consultants (3) hired by the lawyers to assist them in dealing with the media in cases [or litigation] (4) that are made for the purpose of giving or receiving advice (5) directed at handling the client’s legal problems are protected by the attorney client privilege.”
In applying these factors, the court noted that the defendants’ counsel, rather than the defendants themselves, had hired the public relations firm. Further, the court held that the communications at issue involved “giving and receiving legal advice about the appropriate response to the lawsuit and making related public statements.” Specifically, the communications dealt with the draft answer and counterclaim, exhibits to pleadings, a response to an initial press inquiry, a draft press release, and settlement negotiations.
The court found that the attorney-client privilege extended to the communications between the public relations firm and the defendants’ counsel. The court also found that the work-product doctrine applied to the communications. More specifically, the draft answer and counterclaim and draft press release fell under Federal Rules of Civil Procedure 26(b)(3)(B) and 26(b)(3)(A), being “the mental impressions, conclusions, opinions or legal theories of a party’s attorney or other representative concerning the litigation,” and “prepared in anticipation of litigation or for trial.”
Jurisdictional Differences Warrant Caution
“Courts are divided on whether the attorney-client privilege applies to communications between an individual’s attorney and a public relations firm,” says Sidney W. Degan, New Orleans, LA, cochair of the Section of Litigation’s Admiralty Litigation Committee. “Unfortunately, courts are taking this on a case-by-case basis with conflicting results among various jurisdictions,” he adds. “Generally, a communication that is meant to educate the lawyer, or a communication that includes mere public relations or media advice with no legal ties, is unlikely to be protected,” warns Degan.
Communications between a law firm and a public relations firm can be privileged for different reasons. “Although there is no universal bright-line rule for when the attorney-client privilege will apply to these communications, courts have generally extended the privilege to public relations consultants in two scenarios,” notes Degan. “The first is the five-part rule adopted in the Stardock Systems case. The second is when the public relations firm is the ‘functional equivalent’ of the client’s employee. Basically, a public relations firm is the functional equivalent of the client’s employee when it is so engrained in the operations of the corporation that it is very similar to an in-house public relations department,” explains Degan.
Lawyers Should Hire PR Firms Directly
The lawyer—not the client—should be the one to engage the public relations firm. “This case hinged on the fact that the law firm retained the public relations firm and the advice was being provided to the lawyers,” explains Thomas G. Wilkinson Jr., Philadelphia, PA, member of the ABA Standing Committee on Professionalism. “The court implied that the outcome may have been different if the client had retained the public relations firm,” he adds.
When hiring a public relations firm, attorneys should carefully craft the engagement agreement. “At a minimum, lawyers should be certain the retention agreement with a public relations firm is clear that the agreement is with the law firm directly and to assist the law firm in providing privileged and confidential legal advice to the client, and that all communications will be deemed confidential,” suggests Wilkinson.
Benjamin E. Long is a contributing editor for Litigation News.
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