Facing a motion to compel production, collection law firm, Toback, Bernstein & Reiss, LLP, unsuccessfully argued that its retainer agreement with its client, Columbia University, is protected from disclosure under the attorney-client privilege. This decision arises from a class action[1] brought in the Eastern District of New York.
The attorney-client privilege essentially shields client communications that relate to legal advice. This privilege encourages clients to make "full and frank" disclosures to their attorneys who are then able to provide candid advice and effective representation.[2]
The court recognized the "long and unbroken" line of cases that fee arrangements with clients are not the type substantive communications protected by the attorney-client privilege, and their disclosure does not incapacitate the attorney from rendering legal advice.
The court further found credible the plaintiff's argument that the retainer agreements were relevant for determining the "reasonableness" of the fees charged by Toback Bernstein to the class action debtors. The court found this argument "sufficient to establish relevance for the purpose of discovery, where the standard is whether the information is reasonably calculated to lead to admissible evidence at trial."
The court further held that letters sent from Toback Bernstein to Columbia were also unprotected by the attorney-client privilege since the information contained therein were not related to Columbia's acquisition of legal advice – but for Toback Bernstein to obtain information related to its debt collection business.