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By Samson Habte
April 14 — Billing statements are “confidential communications” within the meaning of California's attorney-client privilege statute and thus categorically exempt from disclosure under the state's public records law, the California Court of Appeal, Second District, held April 13.
The ruling—which answers a question of first impression that has divided courts around the country—denied a petition that the ACLU of Southern California filed after Los Angeles County officials rejected an open records request for the billing invoices of law firms to which the county paid nearly $40 million in a single year to defend it against a spate of police brutality lawsuits.
Writing for the court, Justice Richard D. Aldrich said the county validly invoked a statutory exemption that applies to records containing confidential communications protected by the attorney-client privilege.
In doing so, the court rejected the ACLU's argument that “only communications containing legal advice or opinion qualify as confidential communication.”
The court said “proper redactions” would not eliminate privilege concerns. Citing cases analyzing the privilege in other contexts, Aldrich said: “‘when the communication is a confidential one between attorney and client, the entire communication' is privileged.”
The ACLU said the “public interest” also favored disclosure because the billing statements were needed to ensure that taxpayer funds were not being used to support vexatious litigation tactics allegedly employed by law firms retained to defend the county in nine lawsuits that jail inmates filed against the county sheriff's department.
“Given the issues raised by the allegations in these complaints and the use of taxpayer dollars to pay for the alleged use of scorched earth litigation tactics, the public has a right and interest in ensuring the transparent and efficient use of taxpayer money,” the ACLU said its original petition for a writ of mandate, which a trial judge granted in June 2014.
In an appellate brief the ACLU pointed to a report stating that the sheriff department was responsible for half of the county's litigation expenses for fiscal year 2012-2013, and that outside firms collected $39.8 million of $53.2 million spent on attorneys' fees.
The court said there was no controlling case law on “whether billing statements qualify as privileged communications” under Cal. Evid. Code §952, which codifies the attorney-client privilege.
“While several cases have touched on the fringes of this question, none have squarely decided it,” Aldrich wrote. He cited one opinion that assumed without deciding that billing statements are privileged, another that assumed without deciding that they are not privileged and a third opinion in which an appeals court “was skeptical of the notion [that] billing records were privileged” but “offered no analysis” for that view.
Courts in other jurisdictions have resolved the question. But “out-of-state authorities are of limited utility” because “the attorney-client privilege is a creature of statute” in California, the court said.
Accordingly, the court analyzed the language of Section 952, which defines “confidential communications” as:
information transmitted between a client and his or her lawyer in the course of that relationship and in confidence by a means which, so far as the client is aware, discloses the information to no third persons other than those who are present to further the interest of the client in the consultation or those to whom disclosure is reasonably necessary for the transmission of the information or the accomplishment of the purpose for which the lawyer is consulted, and includes a legal opinion formed and the advice given by the lawyer in the course of that relationship.
The parties disagreed about the meaning of the final clause, “and includes a legal opinion formed and the advice given by the lawyer.” The ACLU said it means that only communications containing legal advice or opinion qualify as confidential.
The court disagreed. Nothing in the legislative history indicates that the challenged language was intended “to restrict privileged communications to those containing a legal opinion,” Aldrich wrote.
The court said the ACLU's reading of the statute would produce “absurd” results “when a communication originates with the client.”
“A client's letter or email to his or her attorney is unlikely to contain a legal opinion or legal advice, yet there is little doubt most such communications would fall within the statutory definition,” Aldrich said.
The court also dismissed as “overstated” the ACLU's assertion that applying the attorney-client privilege to billing records would “wreak havoc with the procedures for seeking fees” under fee-shifting statutes.
“Detailed billing statements are not always necessary to support a fee award,” the court said. “And, of course, a client is free to waive the attorney-client privilege, thereby allowing his or her attorneys to provide detailed time records when necessary to support a request for attorney fees.”
Nor was the court swayed by the “public interest” arguments. “We agree that significant public interests are involved,” Aldrich wrote. However, he added, “where the attorney-client privilege applies, disclosure may not be ordered, without regard to relevance, necessity or the particular circumstances of the case.”
Justices Lee Smalley Edmon and Patti S. Kitching joined the opinion.
The ACLU of Southern California was represented by Legal Director Peter Eliasberg and by Davis Wright Tremaine LLP. The Los Angeles County Board of Supervisors was represented by County Counsel Jonathan Crothers McCaverty and by Greines, Martin, Stein & Richland LLP.
Copyright 2015, the American Bar Association and The Bureau of National Affairs, Inc. All Rights Reserved.
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