Opinion ID: 1263765
Heading Depth: 1
Heading Rank: 6

Heading: Inadvertently Produced Document

Text: Allstate inadvertently provided a two page document to Ms. Thoburn during discovery. Allstate seeks to bar further dissemination and use of that specific document on the grounds of attorney-client privilege. The circuit court denied Allstate's request for a protective order prohibiting further dissemination and use of the document. This issue appears to be one of first impression for this Court. [39] Three approaches are used by courts to determine whether or not inadvertently disclosed attorney-client communication constitutes a waiver of the attorney-client privilege. The court in Gray v. Bicknell, 86 F.3d 1472 (8th Cir.1996) explained the three approaches as follows: As noted by this Court in Pavlik v. Cargill, Inc., 9 F.3d 710, 713 (8th Cir. 1993), courts have generally followed one of three distinct approaches to attorney-client privilege waiver based on inadvertent disclosures: (1) the lenient approach, (2) the middle of the road approach ... and (3) the strict approach. Under the lenient approach, attorney-client privilege must be knowingly waived. Here, the determination of inadvertence is the end of the analysis. The attorney-client privilege exists for the benefit of the client and cannot be waived except by an intentional and knowing relinquishment. Georgetown Manor, Inc. v. Ethan Allen, Inc., 753 F.Supp. 936, 938 (S.D.Fla.1991); see also Mendenhall v. Barber-Greene Co., 531 F.Supp. 951, 954 (N.D.Ill.1982) (holding that the better rule is that mere inadvertent production does not waive attorney-client privilege).... The lenient test creates little incentive for lawyers to maintain tight control over privileged material. While the lenient test remains true to the core principle of attorney-client privilege, which is that it exists to protect the client and must be waived by the client, it ignores the importance of confidentiality.... The second approach is known as the strict test. [The plaintiff] urges the Court to adopt such a test and refers to In re Sealed Case, 877 F.2d 976 (D.C.Cir.1989), a case describing the D.C. Circuit's strict test.... Under the strict test, any document produced, either intentionally or otherwise, loses its privileged status with the possible exception of situations where all precautions were taken. Once waiver has occurred, it extends `to all other communications relating to the same subject matter.' Id. at 981 (quoting In Re Sealed Case, 676 F.2d 793, 809 (D.C.Cir.1982)); Texaco Puerto Rico v. Dep't of Consumer Affairs, 60 F.3d 867 (1st Cir.1995). While the strict test has some appeal in that it makes attorneys and clients accountable for their carelessness in handling privileged matters, [it should be rejected] because of its pronounced lack of flexibility and its significant intrusion on the attorney-client relationship.... There is an important societal need for people to be able to employ and fully consult with those trained in the law for advice and guidance. The strict test would likely impede the ability of attorneys to fill this need by chilling communications between attorneys and clients. If, when a document stamped attorney-client privileged is inadvertently released, it and all related documents lose their privileged status, then clients will have much greater hesitancy to fully inform their attorney. Finally, there is the middle test, sometimes called the Hydraflow test.... Hydraflow, Inc. v. Enidine Inc., 145 F.R.D. 626, 637 (W.D.N.Y.1993). Under the Hydraflow test, the court undertakes a five-step analysis of the unintentionally disclosed document to determine the proper range of privilege to extend. These considerations are (1) the reasonableness of the precautions taken to prevent inadvertent disclosure in view of the extent of document production, (2) the number of inadvertent disclosures, (3) the extent of the disclosures, (4) the promptness of measures taken to rectify the disclosure, and (5) whether the overriding interest of justice would be served by relieving the party of its error. Id. ; see also Alldread v. City of Grenada, 988 F.2d 1425, 1433 (5th Cir. 1993). If, after completing this analysis, the court determines that waiver occurred, then those documents are no longer privileged. At the court's discretion, the privilege may also be determined to have been waived for related, but-as-yet undisclosed, documents. [The middle] test strikes the appropriate balance between protecting attorney-client privilege and allowing, in certain situations, the unintended release of privileged documents to waive that privilege. The middle test is best suited to achieving a fair result. It accounts for the errors that inevitably occur in modern, document-intensive litigation, but treats carelessness with privileged material as an indication of waiver. The middle test provides the most thoughtful approach, leaving the trial court broad discretion as to whether waiver occurred and, if so, the scope of that waiver. It requires a detailed court inquiry into the document practices of the party who inadvertently released the document. Gray, 86 F.3d at 1483-84. Most courts apply the Hydraflow test. [40] We, too, believe that the Hydraflow test or middle test strikes the proper balance in determining on a case-by-case basis whether or not the inadvertent disclosure of attorney-client privileged communication constitutes a waiver of the privilege. Therefore, we hold that when attorney-client privileged documents are inadvertently disclosed during discovery, such disclosure does not in and of itself constitute a waiver of the privilege. In order to determine whether to apply the waiver doctrine to such disclosure trial courts must consider the following factors: (1) the reasonableness of the precautions taken to prevent inadvertent disclosure in view of the extent of document production, (2) the number of inadvertent disclosures, (3) the extent of the disclosures, (4) the promptness of measures taken to rectify the disclosure, (5) whether the overriding interest of justice would be served by relieving the party of its error and (6) any other factors found to be relevant. We further hold that the party inadvertently disclosing attorney-client privileged communication bears the burden of showing by a preponderance of evidence that the communication should retain its privileged status. The trial court's determination of this issue will not be reversed absent an abuse of discretion. In the instant proceeding the trial court did not have the benefit of the Hydraflow test when it denied Allstate's motion for a protective order on the inadvertently disclosed document. We therefore set aside the trial court's order denying a protective order. On remand the trial court must hold a hearing on the motion for a protective order and apply the Hydraflow test in determining whether to issue a protective order on the inadvertently disclosed document. [41]