Privilege Case Analysis

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The court’s holding in this case should be easily distinguishable in any similar case, because of one short sentence in footnote two of the opinion: “The record does not indicate whether Fox’s initial conversations with Lamon and Isaf were authorized by Jung.”

The statement is astounding; assuming that the statements were actually made, given their nature, either the defendant’s attorney is patently unfit to practice law, or the defendant waived the attorney-client privilege. The latter is far more likely.

On four separate occasions, according to the witnesses, Jung’s attorney revealed to them that Jung had admitted to him that he had defrauded the investors. Such a strategy almost certainly was authorized by Jung.

The district court in this case held that the statements were not protected by the attorney-client privilege at all, so a hearing on whether the privilege was waived would have been superfluous under the circumstances.

Nevertheless, this case demonstrates why findings of fact should still be made on waiver, even when a court finds that no privilege exists. As noted, had there been a record made on the issue, it is highly probable that waiver would have been found, or that Jung did not intend the statements to be privileged in the first place.

Here, the Seventh Circuit found the error harmless in any event. In many cases, however, the admission of such damning statements will not be harmless. The case would then have to go back to the district court for a determination of waiver. It would be far more efficient to make a finding of fact on waiver in the first instance, even when the district court finds that no privilege exists.

	Related Article Statements protected by attorney-client privilege

Another troublesome aspect of the decision is the following statement by the court, “As the government acknowledges in its brief, ‘Fox’s statements served one purpose — that being to notify victims about the situation on behalf of the defendant as part of a strategy to be cooperative.’”

The court interprets this as grounds to distinguish U.S. v. Harris, 914 F.2d 927 (7th Cir. 1990), and U.S. v. Sanders, 979 F.2d 87 (7th Cir. 1992). However, on its face, the government’s argument appears to be that the statements are not privileged, because Jung authorized Fox to pursue a cooperative strategy that included admitting wrongdoing. That would indicate that, even if there was a privilege, it was waived.

Also troublesome is that the court places significance on the fact that the statements attributed to Fox were made more than five years before the criminal trial.

Pursuant to FRE 401(4), statements by counsel to a prosecutor in the course of plea negotiations are inadmissible, but statements during pre-charging investigation can be admitted. By analogy, the fact the statements were made long ago, before any civil or criminal proceedings were pending, should weigh in favor of admitting the statements, not against.

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David Ziemer can be reached by email.