VLA&S’s experienced attorney investigators regularly conduct complex personnel investigations for corporate clients. Historically, one of the benefits of having outside legal counsel conduct a pre-litigation workplace investigation was that the attorney-client relationship was thought to protect the investigation file from discovery.
This benefit was affirmed in a case called City of Petaluma v. Superior Court, in which the First District Court of Appeal held that a pre-litigation factual investigation conducted by outside counsel was protected by both the attorney-client privilege and the work product doctrine because it constituted the provision of legal services to a client.
In the underlying action, Plaintiff Andrea Waters (a former City of Petaluma firefighter) sued the City of Petaluma for hostile work environment; discrimination based on her gender; retaliation; and, failure to prevent harassment during her tenure as a City firefighter. Waters resigned from the Fire Department three days after filing a complaint with the EEOC.
The City Attorney retained an outside attorney investigator to investigate Waters’ claims. The retention agreement between the City and the investigator stated that the investigator would “interview witnesses, collect and review pertinent information, and report to [the City] on that information.” The agreement also stated that it created an attorney/client relationship between the City and the investigator that the investigation would be subject to the attorney-client privilege, but that the investigator would not “render legal advice as to what action to take as a result of the findings of the investigation.”
Waters filed a lawsuit shortly after the conclusion of the investigation. During discovery, Plaintiff sought documents and testimony relating to the investigation, including the investigative report, in discovery. The City objected, asserting the information was protected by the attorney-client privilege and/or the work-product doctrine. The trial court granted Plaintiff’s motion to compel, finding that the information sought was not subject to the privilege or the work-product doctrine because the retention agreement specifically stated that the investigator would not provide legal advice. The City brought the matter before the Court of Appeal.
The Court of Appeal rejected the employee’s argument that the attorney was merely a fact-finder whose sole task was to gather information and transmit it to the employer. Instead, the Court reasoned that the attorney was expected to “use her legal expertise to identify the pertinent facts, synthesize the evidence, and come to a conclusion as to what actually happened.” Importantly, the Court relied heavily on the retention agreement which: (1) expressly specified that it created an attorney-client relationship; and (2) provided that the attorney would use her expertise in employment law to arrive at findings based upon her “professional evaluation of the evidence.”
This case highlights the importance of protecting the attorney-client privilege by clearly outlining the attorney’s duties and responsibilities in a retention letter.