A joint defense agreement provides an exception to what would be the waiver of the attorney client and work product privileges. At least one Illinois court now recognizes the validity of the joint defense agreement rule, allowing separately-represented codefendants to share privileged information without waiving the attorney-client and work-product privileges. See Selby v. O’Dea, 2017 IL App (1st) 151572.
The joint defense agreement is oftentimes the most cost-effective way to manage a multiple-party litigation.
The joint defense exception also goes by the following names depending on the state: joint-defense doctrine, joint-defense privilege, joint-prosecutorial privilege, allied-lawyer privilege, common-interest doctrine, common-interest exception, common-interest privilege, common-interest rule, common-defense doctrine, pooled-information privilege, common-purpose theory, community-of-interest doctrine, joint-client privilege, joint-client doctrine, common-interest exception to waiver, and shared-confidentiality privilege.
In cases where multiple entities are sued, oftentimes defendants are represented by separate counsel. These situations typically arise between distinct entities but also occur in the employer/employee context. The involvement of different attorney is usually necessary because of different defenses and conflicts of interest between defendants.
Nevertheless, there are often cases where defendants are similarly aligned and defenses overlap. When defenses are similar, the best defense strategy may be a joint defense, where the attorneys and their parties share strategies and theories of defense and may involve sharing information that would otherwise be privileged under the attorney-client or work-product doctrines. In the absence of a valid joint defense agreement, the parties risk waiving the attorney client and work product privileges because they are technically disclosing confidential information in the presence of a third party.
Illinois First District Court Recognizes the Validity of a Joint Defense Agreement
Selby v. O’Dea, 2017 IL App (1st) 151572, is the first case in Illinois to recognize the validity of a joint defense agreement. In that decision, the First District Appellate Court stated, “…we hold that coparties in a case who agree to share information pursuant to their common interest in defeating their litigation opponent do not waive either the attorney-client or work-product privilege when they do so.”
The Illinois Appellate Court determined that Illinois should recognize the joint-defense exception based on several reasons.
First, the common-interest exception to waiver offers all parties to the exchange the real possibility for better representation by making more information available to craft a position and inform decision-making in anticipation of or in the course of litigation. Without such protection between two parties sharing a common interest, the threat of mandatory disclosure may chill the parties' exchange of privileged information and, therefore, thwart any desire to coordinate legal strategy. Protecting these communications promotes candor that may otherwise have been inhibited and allows attorneys to fully and completely prepare for trial by assuring that their legal preparations will not be accessible to an adversary.
Second, cooperation between defendants in such circumstances is often not only in their own best interests but serves to expedite the trial or the trial preparation. Co-counsel in multiple-party cases often pool their resources at trial; one lawyer may cross-examine one of the opponent's witnesses, while the other will focus on a different witness; one may handle the opening statement, while another focuses on the summation. Entire portions of the defense or prosecution of a case may be divided up among the parties. That division of work not only helps the multiple parties on the same side of the case, it promotes efficiency at trial, preventing what could be a fair amount of redundancy in questioning and argument. The discovery process is likewise better served when parties are allowed to pool resources, avoiding unnecessary repetition.
Third, the attorney-client privilege in Illinois already protects statements made by the client to necessary agents of the attorney or client, including certain non-testifying experts and investigators who assist in the preparation of the case.
The Appellate Court also recognized that Illinois defense attorneys have been engaging in defense agreements in Illinois with authority from both Illinois federal district court decisions and decisions from other states which already recognized the joint defense agreements as early as the 1900s.
Broad, But Not Complete, Protection for a Joint Defense Agreement
The First District Appellate Court provided board protection for joint defense agreements, stating, “…coparties in a case who agree to share information pursuant to their common interest in defeating their litigation opponent do not waive either the attorney-client or work-product privilege when they do so .”
The Appellate Court held that the parties must have a “common interest” but the parties need not be perfectly aligned in every respect.
The Appellate Court also provided a broad protection for users of a joint defense agreement:
To summarize, the common-interest exception to the waiver rule protects from disclosure to third parties those statements made to further the parties' common interest, pursuant to a common-interest agreement, (1) by the attorney for one party to the other party's attorney, (2) by one party to the other party's attorney, (3) by one party to its own attorney, if in the presence of the other party's lawyer, and (4) from one party to another, with counsel present.
The protection is not absolute. The Appellate Court did not extend the exception to communications between one party to the other in common interest. It stated “whether client to client communications, without the presence of counsel, are covered by the common-interest exception to the waiver rule is not an issue we must decide.”
The terms of a Joint Defense Agreement – Best Practices.
The Shelby case involved a written joint defense agreement, but the Appellate Court did not include language requiring that an agreement be in writing. The Court’s decision provided that there were two essential aspects of the agreement: a common interest and an agreement that the information be maintained as confidential.
The best practice would be to put the joint defense agreement in writing so that there is no ambiguity regarding the intent of the parties.
Below is a non-exhaustive list of the items an agreement should include:
- A statement that it is a Joint Defense Agreement.
- Effective dates.
- Background setting forth the case and parties involvement.
- Purpose and common interest setting forth that the parties have certain common interests in the litigation and desire to aid and promote adequate representation, to assert common defenses, to facilitate fact-gathering and legal analysis, and to achieve efficiencies and cost reductions in the Litigation.
- Intent to share information such as (a) the investigation, preparation and coordination of the defense; (b) the preparation for and participation at depositions; (c) the selection, preparation and presentation of defense expert witnesses on the various issues in the case, including attorney malpractice and damages; (d) the preparation for and participation in the depositions of expert witnesses and (e) other matters related to the case.
- Extent of shared Information includes, without limitation, statements made to further the parties’ common interest, pursuant to this Agreement: (1) by the attorney for one party to the other party’s attorney; (2) by one party to the other party’s attorney; (3) by one party to its own attorney, if in the presence of the other party’s lawyer; and (4) from one party to another, with counsel present. This exchange of confidential information shall be protected by the joint defense privilege recognized in cases such as Selby v. O’Dea, 2017 IL App (1st) 151572.
- Non-Waiver of the attorney-client and work product privileges.
- Confidentiality of the contents of any communication or document received under this Agreement.
- Notice before disclosure to any entity outside of the agreement.
- Conflict of interest and disqualification clause setting forth that the agreement will not create an attorney-client relationship between the client and co-counsel thereby causing a disqualification.
- Any information that is exempt from the agreement, including a statement where the interests in the litigation are not aligned.
- No limitations on the producing party’s use of their own information.
- Joint ownership of work product.
- Specific agreement related to the modification and termination of the agreement.
- Return of materials upon any party being dismissed from the case or withdrawing from the agreement.
- Right to settle independently of the other parties to the agreement.
- Statement that it is to be continued under the laws of the State of Illinois without regard to conflict of laws.
- Signatures of clients and attorneys bound by the agreement.
It is also good practice to make sure that your client is aware of the limitations of the joint defense agreement and instruct them not to discuss the case with the other parties to the joint defense agreement outside the presence of counsel.
If you have any questions regarding joint defense agreements, please contact Kristin Tauras at McKenna Storer.