New District Court Case Limits Application of Attorney-Client Privilege in Workplace Investigations Conducted by Counsel

Written by: Monica Munin, Esq.

The United States District Court for the Western District of Virginia released a published opinion granting (in part) a plaintiff’s motion to compel seeking the release of an employer’s communications and investigation report with counsel regarding a complaint of sexual harassment. The motion also sought information from counsel regarding what advice the employer received from counsel regarding “how to structure” the plaintiff’s termination. The motion was denied with respect to the attorney’s communications with counsel regarding the plaintiff’s termination and granted with respect to the communications relating to the investigation of the plaintiff’s sexual harassment claims.

The case involves a woman employed by the Town of Front Royal, Virginia (“the Town”) who complained of repeated instances of sexual harassment perpetrated by a colleague, William Sealock. According to the plaintiff, she met with the Human Resources Department in August of 2019 to discuss her complaint following conversations she had had with other Town employees regarding repeated instances of unwanted touching and inappropriate remarks despite telling Sealock that the comments and touching were unwanted. Human Resources told the plaintiff she would hear back within two weeks following the completion of an investigation. The plaintiff did not hear from Human Resources or anyone from the Town, however, until November 2019. According to the plaintiff she had to repeatedly request updates on the status of the investigation and sought help from the Town to alleviate the harassment and retaliatory conduct she was suffering since reporting the sexual harassment. The plaintiff alleges that the investigation report in the matter was “wholly dismissive of her complaints (to the extent they were investigated at all) and [was] indicative of a sham investigation.” The plaintiff went on medical leave in December 2019 and was terminated upon returning to work on January 30, 2020. The plaintiff alleges that the Town’s stated reason for her termination, that her job was subject to “right-sizing” was a pretext for sex-based discrimination and retaliation. The plaintiff initially filed a complaint with the Equal Employment Opportunity Commission (“EEOC”) before bringing suit against the town for violations of the Family Medical Leave Act (“FMLA”), as well as violations of Title VII of the Civil Rights Act of 1964.

Specifically, the plaintiff alleged sex-based discrimination, unlawful retaliation, and retaliatory hostile work environment in addition to her allegations that FMLA was violated. Shortly thereafter, the plaintiff filed a motion to compel, claiming that the Town had put the advice provided by the attorney hired to conduct the investigation in issue, thereby waiving attorney-client privilege over the communications. During depositions, the Town’s representative testified that Julie Judkins was hired “to make sure that everything in the investigation, and later in the firing of [the plaintiff] was done to ensure it was legal.” The plaintiff’s motion sought the release of “information and documents underlying Ms. Judkin’s involvement in both the investigation of [the plaintiff’s] harassment and retaliation complaints and in the termination of [the plaintiff’s] employment.” During depositions, the Town’s attorney had refused to allow Ms. Judkin (the Town’s counsel) to respond to a question asking if “Ms. Judkin’s advised the town how to end the plaintiff’s employment with the Town.” When asked why the Town had hired Ms. Judkins, the Town’s reply was “to advise Town council as it relates to a complaint that was made by [the plaintiff].” The Town representative’s deposition indicated that the investigation into the plaintiff’s allegations was “conducted by [Human Resources] and counsel” and that “if legal counsel and the [Human Resources] Department had concluded that there was sexual harassment or retaliation or a hostile work environment, he without a doubt…would have encouraged Council to take all the appropriate action afforded to us by law.” The Town’s representative further testified (after being asked to opine if the plaintiff’s allegations, assuming they were true, violated the company’s sexual harassment policy) “that would be up to the investigative body, in this case, it was the [Human Resources] Director in conjunction with legal counsel, to draw that legal conclusion of what that was harassment or not…” The Town had asserted privilege over its communications with the attorney that conducted the investigation as to the communications regarding the investigation, any advice sought regarding how to structure the plaintiff’s termination, and any advice regarding the conclusions of the investigation and remedial action recommended thereafter. The Town’s argument against waiving privilege is that it had not raised “reliance on the advice of counsel” as a defense in the case.

The Court held that the Town “put Ms. Judkin’s involvement in the investigation of [the plaintiff’s] internal complaints at issue but had not put ‘at issue’ her advice regarding Brown’s termination.” In granting the plaintiff’s motion with respect to the attorney’s involvement in the investigation, the Court noted “[the Town] essentially turned the investigation of the plaintiff’s charges over to the attorney, and it was counsel who assembled the facts, drew the conclusions, and constructed the remedial response…under those circumstances, to prevent plaintiffs from discovering what was done by counsel and why, would be tantamount to giving the defendants both the ‘sword’ (i.e. the argument ‘that we were reasonable because we had our attorneys investigate the charge and craft a response’) and the ‘shield’ (i.e. what our attorneys did and why they did it, is privileged’).” The Court found that the information sought by the plaintiff was “likely to speak directly to whether the defendants had actual knowledge of all the circumstances surrounding the allegations and whether their response to such allegations was clearly unreasonable.” It was the town’s reliance on the attorney to assist with the investigation and advice about what remedial measures were necessary, if any, that put the Town’s communications with counsel at issue in the case. The Court thereafter permitted the plaintiff to depose the Town’s counsel to an inquiry “[limited to] knowledge concerning the investigation and actions taken by the defendant in response to plaintiffs’ allegations.” With respect to the plaintiff’s assertion that the Town had put communications with counsel at issue regarding the plaintiff’s termination and had waived privilege by stating in its EEOC position statement that counsel was hired to “ensure compliance with the law,” the Court found that attorney-client privilege had not been waived and the plaintiff could not depose the town’s counsel regarding that issue.”

The case underscores the delicate balance clients and attorneys must strike when seeking to investigate and address allegations of discrimination in the workplace. It is vitally important to work with an attorney knowledgeable not only about the employment law statutes at issue but also skilled in ensuring that protected communications are not put into an issue where an employer would prefer to maintain confidentiality. 

Questions or concerns about this case? Please feel free to reach out by way of phone or email Monica Munin for guidance.

This blog post is not intended to provide legal advice or substitute for the advice of legal counsel with respect to specific facts and situations. See disclaimer