On June 6, 2017, the First Department had an opportunity to apply—and reaffirm—last month’s decision in Peerenboom v. Marvel Entm’t, LLC, where the Court held that use of a company email system for personal purposes “does not, standing alone, constitute a waiver of attorney work product protections” even if the user lacked reasonable assurance of confidentiality necessary to bring the documents within the attorney-client or marital privileges. In Miller v. Zara USA, Inc., plaintiff, the former general counsel of Zara USA, Inc., sought a protective order precluding the company from accessing personal documents on a company-owned laptop, claiming the documents to be protected by the attorney-client and work-product privileges. The Supreme Court issued the protective order and Zara appealed.
In its decision on appeal, the First Department rejected plaintiff’s attorney-client privilege claim, finding plaintiff lacked any reasonable expectation of privacy in his personal use of the laptop computer supplied by Zara. The Court observed that, among other things, Zara’s employee handbook, of which plaintiff would have had “at least constructive knowledge” as its general counsel, “restricted use of company-owned electronic resources, including computers, to ‘business purposes,’” warned that “[a]ny data collected, downloaded and/or created” on such resources was “the exclusive property of Zara” and “may be accessed by Zara at any time, without prior notice,” and stated that employees “do not have an expectation of privacy or confidentiality in any information transmitted or stored in Zara’s electronic communication resources (whether or not such information is password-protected).”
The First Department, however, found that plaintiff’s storage of documents on the company’s laptop did not, by itself, waive attorney work-product protection with respect to the documents. The work product privilege “is waived upon disclosure to a third party only when there is a likelihood that the material will be revealed to an adversary, under conditions that are inconsistent with a desire to maintain confidentiality.” Bluebird Partners, L.P. v. First Fid. Bank, N.A.. While Zara is plaintiff’s adversary in the action (in which plaintiff asserts discrimination, hostile work environment, and wrongful termination claims against the company), Zara did not dispute that it never actually viewed any documents stored on plaintiff’s laptop. The First Department, quoting Peerenboom, concluded that “[g]iven the lack of any actual disclosure to a third party, ‘[plaintiff’s] use of [Zara’s computer] for personal purposes does not, standing alone, constitute a waiver of attorney work product protections.’” It remanded the case to the Supreme Court for an in camera review of the documents plaintiff claimed to be attorney work product.
As with the First Department’s decision last month, Zara underscores both the risks employees face when using company devices for personal (and, in particular, legal) purposes as well as the distinct protection afforded by the attorney work-product doctrine.