By Hon. Martin E. Ritholtz & Alon Harnoy, Esq.
July 9, 2018
The importance of confidentiality can be traced all the way back to the saged advice of King Solomon in Proverbs (chapter 25,verse 9), where he cautioned: “…do not reveal another’s confidence.”
The special confidential relationship between attorney and client, popularly known as the “attorney-client privilege,” has been historically linked to the reign of Queen Elizabeth I. In the words of John Henry Wigmore, a renowned expert and author on the laws of evidence, “The policy of the privilege has been plainly grounded…In order to promote freedom of consultation of legal advisors by clients, the apprehension of compelled disclosure by the legal advisors must be removed, and hence the law must prohibit such disclosure except on the client’s consent.”
Nevertheless, the modern day law of attorney-client privilege, which is the product of judicial decisions, statutes, and rules of professional conduct, has carved out exceptions that, under certain circumstances, can potentially eliminate any confidentiality protections.
Suppose a client seeks the confidential opinion of an attorney as to whether a certain proposed transaction is legal, and upon adhering to the advice of counsel the client entered into the transaction, however, the transaction is subsequently challenged as being illegal. Can the confidential communications which served as the basis of the transaction, later be subject to a subpoena or warrant, when a legal claim or disciplinary charge alleges complicity of the lawyer in the client’s conduct, or other misconduct of the lawyer involving representation of the client?
In effect, the paradox is: the attorney-client privilege encourages full, unfettered disclosure, yet, it would appear that such confidentiality is not guaranteed; and a good faith opinion, in a distinctly gray situation, can possibly be turned into a nightmare experience. In other words, is attorney-client confidentiality a privilege or a peril? Is this dilemma exacerbated in a high-profile case, such as the Trump/Michael Cohen dynamic?
THE TRUMP/MICHAEL COHEN SCENARIO
As reported, on April 9, 2018, the F.B.I. raided and seized the business records, emails and documents of President Trump’s personal attorney, Michael D. Cohen, relating to several topics, including the payment of $130,000 in hush money to Stephanie A. Gregory Clifford, popularly known as Stormy Daniels, a pornographic film actress. The seized documents include several high-profile clients such as Sean Hannity of Fox news.
The fact that the US attorney’s office in Manhattan obtained a search warrant acting on a referral from Special Counsel, Robert Mueller, and authorized the FBI to conduct such a raid, has stirred an immense amount of controversy regarding the doctrine of attorney-client privilege and the duty of confidentiality owed by an attorney tohis or her client. Senior Federal District Judge for the Southern District of New York, Kimba M. Wood, appointed Barbara S. Jones, a former federal judge, as a special master to review the materials seized from the office and residence of Mr. Cohen, acquiescing to his request that an independent party review the material before the federal prosecutors can gain access to it. The special master has been tasked with the job of assessing whether the documents include any confidential communications between Michael Cohen and his clients, including President Trump.
Trump and the Trump Organization intervened and were also granted access to review the material, alleging attorney-client privilege. On June 4, Jones submitted an initial report, that out of 639 total items consisting of 12,543 pages contained in eight boxes of hard copy materials, the Cohen and Trump attorneys identified seventeen items they believed to be privileged, of which Jones agreed with them on fourteen items, and rejected the claim of attorney-client privilege on the other three. Furthermore, out of 291,770 items contained in two phones and an iPad, Jones found that 148 items are privileged, and that seven items are highly personal. An amended report was filed on June 15, which tweaked the initial report. On June 22, Judge Wood determined that only eight items of communication, out of 292,226 seized by the FBI were protected by attorney-client privilege. In essence, it appears that, at this stage, only a fraction of the documents seized from Cohen qualified for attorney-client privilege protection. Cohen, by his most recent attorney, Todd Harrison, filed a letter on June 25 contending that 12,061 out of over 4 million documents, text messages and emails are protected by attorney-client privilege. Although the Trump Organization counsel Alan Futeras requested an extension to July 11 to review 22,000 documents recently received, Judge Wood ordered that the review be completed by July 5.
It has been reported that the prosecution may be looking into establishing a case that President Trump sought Michael Cohen’s legal advice regarding the Stormy Daniels affair for an illegal purpose: to evade federal campaign –finance laws. President Trump tweeted that indeed no form of campaign contribution had been used to pay off Ms. Daniels. Nevertheless, Daniels’ attorney, Michael Avenatti, alleges that Victor Vekselberg, a Russian oligarch close to President Vladimir Putin, is the real source of the hush money, raising flags as to an alleged illegal purpose.
There are many in the legal community who are flabbergasted by the perceived attack on the sacrosanct shelter of attorney-client privilege, in the guise of an apparently sanctioned seizure of privileged communications. They question whether such a warrant would have been issued, if this were not such a high-profile case, involving the President. In fact, on May 4, Senior Federal Judge T.S. Ellis III of the Eastern District of Virginia, overseeing the criminal case against Paul Manafort, President Trump’s former campaign manager, expressed skepticism regarding Special Counsel Robert Mueller’s wide-ranging tactics. In the words of Judge Ellis: “What you really care about is what information Mr. Manafort could give you that would reflect on Mr. Trump or lead to his prosecution or impeachment.” In a 31-page decision issued on June 26, Judge Ellis reflected on the dangers of special prosecutions in general . “Although this case will continue, those involved should be sensitive to the danger unleashed when political disagreements are transformed into partisan prosecutions.” He also noted, “To provide a special counsel with a large budget and to tell him or her to find crimes allows a special counsel to pursue his or her targets without the usual time and budget constraints facing ordinary prosecutors, encouraging substantial elements of the public to conclude that the special counsel is being deployed as a political weapon.” The same could easily be said regarding the Michael Cohen investigation.As a retired New York State Supreme Court Justice, who for many years dealt with delicate issues of attorney-client privilege, I join those who express deep concern regarding a perceived dangerous precedent, and slippery slope, weakening the institution of attorney-client privilege.
What then is the law of the case?
ATTORNEY-CLIENT PRIVILEGE IN A NUTSHELL
The attorney-client privilege applicable to the Trump/Cohen investigation can be found in Rule 1.6 of the American Bar Association (ABA) Model Rules of Conduct, Rule 1.6 of the New York Rules of Professional Conduct, Rules 501 and 502 of the Federal Rules of Evidence, and to a certain extent, Section 4503 of the New York, Civil Practice Law and Rules (CPLR). The fundamental principle, underlying the privilege, is that, in the absence of the client’s informed consent, the lawyer must not reveal information relating to the representation. This contributes to the trust that is the hallmark of the lawyer-client relationship.
The law carves out a few exceptions to the privilege. For example, neither party can use the privilege in order to commit a crime or perpetrate a fraud. Furthermore, non-legal communications, e.g. relating to business matters, do not qualify for the privilege.
An extreme example of a lawyer’s duty to maintain client confidence under the most trying circumstances, involved two upstate New York attorneys, Frank Armani and Francis Belge. While representing a murder suspect, they learned from their client of two other murders he had committed, and where he dumped the bodies. They did not reveal the location of the bodies. After the client later confessed at trial to the other murders, only then did they reveal their previous knowledge, and were reviled in the court of public opinion for withholding the information. However, in the legal community, as noted in People v. Belge, 372 NYS 2d 798, they were lauded for their zeal with which they had protected their client’s rights.
On the other hand, the prosecution alleging a crime/fraud exception must show that there is “probable cause to believe that a crime or fraud has been committed and that the communications were in furtherance thereof”. The crime/fraud exception applies when the attorney’s advice is used to further a crime. U.S. Supreme Court Justice Benjamin N. Cardozo, in Clark v. United States, 289 U.S. 1(1933) stated that “a client who consults an attorney for advice that will serve him in the commission of a fraud will have no help from the law. He must let the truth be told.”
THE DILEMMA ACCENTUATED
It was previously noted that there is a dilemma where a lawyer renders a legal opinion regarding a transaction that turns out to be illegal, and the attorney-client privilege is in jeopardy, since an allegation of complicity of the lawyer in the client’s illegal conduct, might serve as a basis to raid the privilege.
This dilemma is accentuated, as has been noted by legal scholars, in that there is a conflict between the rules of professional responsibility and criminal law, in their respective definitions of lawyers’ complicity in their clients’ crimes. Under the rules of professional responsibility, a lawyer is exonerated for advising a client in committing a crime if the lawyer acted in good faith. However, the criminal law incriminates the same lawyer of aiding and abetting the client’s crime even if the lawyer believed the conduct in question was legal. As a result of this conflict, professional rules, under these circumstances, would not allow the alleged good faith complicity of the attorney to be the basis for a subpoena or warrant invading the privilege, while the same conduct would be deemed criminal under criminal law, and might very well serve as a basis for an exception to the attorney-client privilege.
Attorney-client privilege forms the bulwark of the legal profession, in as much as the clients are encouraged to communicate with their respective attorneys with candor, and enables them to obtain legal advice in a confidential manner. The present state of affairs casts a shadow on the attorney-client privilege, and presents a classic dilemma whether such form of confidentiality remains a privilege or, having been become imperiled, has now become a liability.
This form of communication presents a two-way street between the attorney and his client. The Trump/Michael Cohen drama is bound to impact both the attorney and the client to reassess their actions. It discourages the attorney from freely selecting the kind of clients and cases he or she may be interested in, while on the other hand, it may impede full and fair disclosure of facts and circumstances with which the client should provide the attorney, in order to obtain the best possible legal advice.
 Hon. Martin E. Ritholtz is a Retired Justice of the New York State Supreme Court and is Special Counsel to Shiboleth LLP. Alon Harnoy is the Managing Partner of Shiboleth LLP. Law Clerk, Divya Suwasini, helped research and write this article.
An abridged version of this article appeared in the Opinion Section of the Jerusalem Post on July 7, 2018.