On 26 January 2022, the French Court of cassation ruled that internal exchanges forwarding and commenting on outside counsel’s advice regarding a company’s defence strategy are protected by legal privilege.
Extension of the protection of legal privilege
At the start of the case, in 2013, the French Competition Authority (FCA) carried out dawn raids on Whirlpool’s premises, suspecting that Whirlpool was engaged in various cartel practices in the ‘white’ and ‘brown’ goods distribution sector.
A few months earlier, following dawn raids on its competitors’ premises, Whirlpool had sought outside counsel advice in preparing its defence. Subsequently, Whirlpool’s in-house counsel exchanged emails between themselves and with other company employees in which they discussed the findings of the external law firm, summarised and commented on the law firm’s strategy and added their own views. When the dawn raid finally took place at Whirlpool’s premises, these exchanges were seized by the FCA.
The Paris Court of Appeal decided that the FCA should not have seized emails discussing the defence strategy set out by Whirlpool’s outside counsel, and so the seizure likely constituted an infringement of legal privilege.
The FCA argued that legal privilege only covers direct attorney–client correspondence, and so excludes documents that only refer to outside counsel’s statements or legal opinions.
By granting legal privilege protection to such emails, the French Court of cassation has now extended the scope of legal privilege to cover internal communications, even if in-house counsel add their own interpretation and commentary to outside counsel’s analysis and strategy.
This case law is in line with the position consistently adopted by EU courts, which grant the benefit of the protection of legal privilege to (i) internal notes reporting the text of the content of privileged communications or (ii) working documents or summaries that were drawn up for the purpose of seeking legal advice from a lawyer.
The Court of cassation continues to strengthen the concept of legal privilege little more than a month after the Law of 22 December 2021 on building confidence in the French judicial system established new safeguards regarding the protection of attorney–client correspondence in the event of dawn raids carried out on the offices or homes of outside counsel.
How Reed Smith can help
With extensive experience of anti-competitive investigations and litigation before EU and national competition authorities and courts, Reed Smith’s EU, Competition & Regulatory team can assist you if you are involved in such proceedings, from the start of an investigation, to dawn raids and their appeals before the courts, to defending clients before the authorities and in appeals on the merits. Reed Smith also represents its clients in private enforcement claims for damages, following decisions of the competition authorities or stand-alone.
Client Alert 2022-040
