An attorney is representing a client in a complex business transaction. During a meeting, the client's business partner (who is not a client of the attorney) shares highly sensitive financial projections, believing they are protected by the attorney-client privilege because they are discussing them in the attorney's presence. The attorney does not correct this belief. What is the ethical status of the financial projections shared by the business partner?
- AThey are not protected by attorney-client privilege or the general duty of confidentiality.
- BThey are protected by attorney-client privilege because they were shared in the attorney's presence.
- CThey are confidential under the attorney's general duty of confidentiality, but not attorney-client privileged.
- DThey are protected by the work product doctrine.
Show answer & explanationAnswer & explanation
Correct answer: C. They are confidential under the attorney's general duty of confidentiality, but not attorney-client privileged.
For attorney-client privilege to apply, the communication must be between a client and their attorney, or their respective agents, for the purpose of obtaining legal advice. Here, the business partner is not the attorney's client, so privilege does not directly extend to their communications. However, the information was shared in the context of legal representation (for the client company) and the attorney did not correct the partner's mistaken belief regarding confidentiality. Therefore, the information is likely confidential under the broader ethical duty of confidentiality (Model Rule 1.6), which covers 'information relating to the representation' gained from any source, but not strictly protected by attorney-client privilege as to the partner.
Why the other options are wrong
- A. Given the context and the partner's mistaken belief, the attorney likely has an ethical duty of confidentiality even if not a formal privilege.
- B. Attorney-client privilege requires a client relationship; the business partner is not the attorney's client.
- D. Work product doctrine protects materials prepared in anticipation of litigation, not general business communications.
Third-Party Sharing & Confidentiality
Information shared by a non-client third party in the presence of an attorney, especially if under a mistaken belief of privilege or relating to the attorney's actual client's representation, may fall under the attorney's ethical duty of confidentiality (Model Rule 1.6) even if not strictly protected by attorney-client privilege.
- Attorney-client privilege requires client relationship.
- Ethical duty of confidentiality is broader than privilege.
- Information 'relating to the representation' is confidential.
- Attorney's failure to correct mistaken belief can create duty.
Memory trick: Confidentiality's net is wide, Privilege's door is inside.