As though commercial transactions were not already fraught with enough potential pitfalls, a recent decision from the Southern District of New York highlighted yet another risk that could carry significant consequences to commercial litigations – the dreaded waiver of attorney-client privilege.
Ambac Assurance Corp. v. Countrywide Home Loans
New York’s Highest Court Refuses to Expand the Common Interest Doctrine to Merging Parties
By Jordan B. Leader on
Last Thursday, the New York Court of Appeals issued a stark reminder to transactional lawyers: no matter how much “common interest” two parties may have with respect to a transaction, the common interest doctrine may not protect their communications.
In Ambac Assurance Corp. v. Countrywide Home Loans, Inc., New York’s highest court held, in a 4-2 decision, that a party waives its attorney-client privilege if it shares privileged information with another party unless (i) those two parties share a common legal interest, (ii) the communication between the parties was made in furtherance of that legal interest, and (iii) the communication relates to pending or anticipated litigation.