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Is it enforceable to have non-disclosure agreements between companies intrude on attorney-client privilege?

If a company were to disclose something with an attorney that is under a confidentiality agreement with a third party, would it be possible for the third party to obtain compensation?

Is it good practice to have attorney-client privilege be something excluded from the definition of "confidential?"

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May non-disclosures agreements between companies intrude on attorney-client privilege?

Yes. The attorney-client privilege may be waived by the client. See for instance, Goins v. Advanced Disposal Services Gulf, 333 So.3d 644, 653 (2021). Waiver can be explicit or implicit (Lacerda v. U.S., Dist. Court, June 2022, citing cases).

See also Center Partners, Ltd. v. Growth Head GP, LLC (Supreme Court of Illinois, Nov. 2012):

Any disclosure by the client is inherently inconsistent with the policy behind the privilege of facilitating a confidential attorney-client relationship and, therefore, must result in a waiver of the privilege. [...] The holder of the privilege against disclosure of the confidential matter or communication waives the privilege if he or his predecessor while holder of the privilege voluntarily discloses or consents to disclosure of any significant part of the matter or communication.

(citations omitted).

If a company were to disclose something with an attorney that is under a confidentiality agreement with a third party, would it be possible for the third party to obtain compensation?

I gather that you mean disclosure to an attorney.

If the disclosure is strictly pursuant to an attorney-client relation and not released elsewhere (i.e., as in litigation using the records unsealed), the third party is unlikely to be entitled to relief. The third party would not even become aware of that disclosure unless the nature of his agreement with the company renders this type of disclosures foreseeable.

Is it good practice to have attorney-client privilege be something excluded from the definition of "confidential?"

It largely depends on how (if at all) the contract defines "confidential", other terms of the contract, and arguably also the context of that contract.

Where the nature of the contract does not entail matters typically protected by the attorney-client privilege, the wording for explicit exclusion of the privilege might inadvertently have an effect in the sense of everything which is not forbidden (that is, explicitly excluded from the definition) is allowed.

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  • If the client waives the privilege, it doesn't exist anymore. I don't see how (a) the confidentiality agreement can be said to intrude on a privilege that no longer exists; or (b) how disclosure to an attorney violates the NDA in a way that leads to damages, unless we're just going to make up a crazy set of facts that the OP hasn't suggested.
    – bdb484
    Aug 22, 2022 at 16:40
  • @bdb484 "I don't see how (a) the confidentiality agreement can be said to intrude on a privilege that no longer exists". The OP's question can be paraphrased as: Would a waiver embedded in an NDA be cognizable? The answer is yes. Neither the OP nor I have assumed that the privilege was waived in any other form. "how disclosure to an attorney violates the NDA in a way that leads to damages, unless we're just going to make up a crazy set of facts". Case scenario: The law firm's sloppiness causes a leak of the third party's trade secrets. Calling this "a crazy set of facts" would be naive. Aug 22, 2022 at 18:00
  • Maybe we're just reading the question differently. As I see it, the OP is asking whether the NDA can prohibit disclosures to an attorney, rather than assuming a waiver embedded in an NDA. I wonder whether such a prospective waiver would even be enforceable.
    – bdb484
    Aug 22, 2022 at 21:45
  • @bdb484 "As I see it, the OP is asking whether the NDA can prohibit disclosures to an attorney". I hear you. The OP's mention of intrude influenced my interpretation in the sense of waiver by agreement. But your agreeable reading does not preempt the possibility of damages as in the case scenario I outlined. "I wonder whether such a prospective waiver would even be enforceable." The parties are free to agree not to involve an attorney at all on what their NDA covers. Nothing in the definition of waiver restricts how far in advance a right or privilege may be renounced. Aug 22, 2022 at 22:54
  • I agree that the definition of "waiver" doesn't impose any such restrictions; I just wonder whether courts would enforce such a waiver when it so gravely undermines the policy considerations motivating the privilege in the first place.
    – bdb484
    Aug 22, 2022 at 23:19

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