Editor’s Note: Michael J. Parrish is a member of the Litigation Practice Group at Ward and Smith, P.A.

Never before have you had more ways to communicate, including with your attorneys. E-mail, cell phones, wireless handheld devices, and text messaging are just some of the new technologies that make communication easier than at any point in history. However, the use of these communication media requires the taking of precautions to ensure that confidential information is not disclosed to third parties, thereby destroying privileges such as the attorney-client privilege. The same features that make these methods of communication so convenient also make them potentially dangerous.

Consider these scenarios:

• An attorney sends an e-mail containing a proposed settlement agreement to the attorney’s client and to opposing counsel for review. The client accidentally selects "reply all" rather than "reply" when sending comments to the proposed settlement agreement back to the client’s attorney.

• A client planning a hostile takeover and who is speaking with the client’s attorney by cell phone in a hotel lobby is overheard by an employee of the target company.

• Management of a company learns about a criminal investigation of a key employee when the company’s system administrator reads an e-mail sent by the key employee to the employee’s criminal attorney over the company’s server.

These scenarios are all too common and occur frequently as business is conducted in a more technologically-advanced world. However, in each case above, information that clients intended to be confidential has been revealed, and the attorney-client privilege may have been waived.

Evidentiary Privileges: What are they?

Evidentiary privileges, such as the attorney-client, doctor-patient, and husband-wife privileges, protect confidential communications between a person and certain historically significant confidantes. The privileges are designed to promote open communication between persons and their significant confidantes by forbidding other parties’ discovery or use of such confidential information against the person.

Not every communication, however, qualifies for protection. For example, in order for the attorney-client privilege to attach to any communication, (1) an attorney-client relationship must exist at the time the communication was made, (2) the communication must be for the purpose of giving or seeking legal advice, and (3) the communication must have been made in a confidential manner.

A privilege is not likely to attach unless the person claiming it reasonably expected that the person and the confidante were the only parties privy to the communication. When a person’s communication becomes known to a third party without fraud on the part of the third party, the communication is no longer confidential and is not privileged.

Cellular Telephones

In the 1990s when cell phone technology was still emerging, courts ruled that because analog cell phone calls could be intercepted with relative ease, the caller did not have a reasonable expectation of privacy when using a cell phone. Because of these rulings, it was feared that privilege may not attach to cell phone conversations. Now, since cell phone usage has become commonplace and digital signals are used almost exclusively, it is uniformly recognized that individuals can reasonably expect privacy in the transmission of their cell phone calls and that cell phone usage, in itself, does not threaten a privilege. Therefore, the transmission or interception of the cell phone call is not the most pressing risk associated with confidential communications using cell phones.

A much greater risk is posed by third parties who may overhear one side of the conversation and, thus, be privy to confidential information. When cell phones are used to pass on confidential information, whether in a restaurant, in an office building, or on the street, precautions must be taken to eliminate the risk that third parties may inadvertently or intentionally overhear the conversation. If not, and third parties in fact overhear confidential information passed as part of a telephone conversation, even in the context of overhearing it in a restaurant, cab, airplane, or office building, any otherwise applicable privilege likely would be destroyed. Some conversations are simply appropriate only in the confines of a private office or other isolated location.

E-mail

E-mail now has become the default method of communication in most business settings. It has streamlined inter-office and external communications to the point where ordinary mail has developed a nasty connotation (i.e., "snail mail"). Like cell phone use, e-mail was viewed initially as unsecure, but was accepted openly as a secure medium of communication as it became more prevalent for social, and especially business, use. Therefore, e-mail use, in general, does not threaten an otherwise applicable privilege. It should be noted, however, that privilege does not likely attach to a person’s e-mail communication if sent over such person’s employer’s e-mail server. Because it is common for employers to reserve the right to review all e-mails on the employers’ servers, no privilege can attach to any communication by an employee over such a server because a third party has access and authority to view such communications at all times. As a result, the employee has no reasonable expectation of privacy, and the communication will not be viewed as confidential and privileged.

Despite the widespread usage of e-mail, no other medium of communication is fraught with as much risk of unintended disclosure of information. E-mails can be forwarded around the world with the click of a mouse and can reside in a computer’s memory indefinitely, despite efforts to erase them. The primary source of unintended disclosure is human error in the form of hitting the "reply all" key unintentionally or typing an e-mail address incorrectly. "Disclaimer" warnings frequently listed at the bottom of e-mails sent by attorneys, financial services advisors, and other professionals serve as a reminder of the prevalence of this problem, but are not a solution. The solution is to use a healthy dose of caution when communicating sensitive information by e-mail to ensure that you treat the information with the secrecy you intend. Do not send sensitive personal communications over employer servers, and take particular care in typing your confidante’s correct e-mail address when corresponding about a confidential matter.

Additionally, intentionally copying even related third parties on e-mails may cause the information to lose the benefit of a privilege. In a recent North Carolina case, the court held that an e-mail sent by a company employee to the company’s attorneys and to non-attorney company employees was not "confidential" and, as such, could be used as evidence against the sender at trial. Before including any third parties to any sensitive communications intended to be kept confidential, you must make certain that your privilege will not be sacrificed in such instance.

Conclusion

Cell phones and e-mails offer unprecedented flexibility and accessibility to information. However, the confidential nature of some information makes its communication by cell phone or e-mail inappropriate and dangerous. Before using a cell phone or e-mail account to relay secret information to a confidante, ask yourself a few questions: Is this information of value to my business and to me and, if so, would I care if it was published in tomorrow’s newspaper? If you are using a cell phone, is there anyone around who may overhear this information? If you are sending an e-mail, is there any chance that an unintended recipient will have access to the message? Important, confidential information is relayed best in a secure, private setting. Taking the time to recognize the risks associated with the use of cell phones and e-mail will ensure that information remains confidential and protected by any applicable privilege.

© 2008, Ward and Smith, P.A.

Ward and Smith, P.A. provides a multi-specialty approach to the representation of technology companies and their officers, directors, employees, and investors. Michael J. Parrish practices in the Litigation Practice Group. Comments or questions may be sent to mjp@wardandsmith.com.

This article is not intended to give, and should not be relied upon for, legal advice in any particular circumstance or fact situation. No action should be taken in reliance upon the information contained in this article without obtaining the advice of an attorney.