Courts around the country continue to refine the scope of the attorney-client privilege and the attorney work-product doctrine in the context of communications between an insurance company adjuster and the insurer’s in-house counsel. Recently, the United States District Court for the District of Colorado held that a claims adjuster’s emails, claim notes, and interoffice memoranda are not privileged, even though they involved the carrier’s in-house attorney. Olsen v. Owners Ins. Co., No. 18-CV-1665-RM-NYW, 2019 WL 2502201 (D. Colo. June 17, 2019)
In Olsen, the plaintiff sought underinsured motorist coverage for injuries he sustained in a motor vehicle accident, and later sued the insurer when no coverage was provided. During the discovery, the plaintiff sought to compel production of the insurer’s documents containing correspondence between its claims adjuster and its in-house counsel, since the insurer withheld these documents as protected by the attorney-client privilege and/or the work-product privilege.
In evaluating the plaintiff’s request to compel, the district court reiterated that the mere fact that an attorney is involved in a communication does not automatically render a communication subject to attorney-client privilege or the work-product doctrine. Rather, the court explained that the application of these protections must be evaluated based on the following factors:
- The information was provided by agents of the corporate client “to counsel acting as counsel” at the direction of supervisors
- The information was necessary for the provision of legal advice
- The agents were aware that their communications were made for the purpose of counsel rendering legal advice to the corporate client
- The communications were treated as confidential
In other words, it is the nature of the services rendered by in-house counsel to the claims professional, not a particular chronology of events, which determines whether any privilege attaches to the communication.
With these guiding principles in mind, the district court evaluated each of the contested documents, considering whether legal advice was requested and/or communicated. The district court held that emails assigning defense counsel, addressing conflict checks, enclosing copies of filed pleadings, or requesting factual information were not subject to the attorney-client privilege or the work-product doctrine. With respect to the adjuster’s claims notes, the court held that the majority of the notes reflected claims handling procedures and, therefore, were not privileged. However, the court found that two entries in the notes reflecting legal advice were privileged and ordered that the entries be redacted, although the court did not further indicate why it believed the entries included legal advice. The court also rejected the insurer’s assertion that all of the communications were protected by the work-product doctrine because the insurer had retained counsel, since it found that the retention of counsel, by itself, was insufficient to establish a reasonable anticipation of litigation on the part of the insurer.
The district court’s ruling is a cautionary one: insurers should not expect that the inclusion of an in-house counsel on a communication will automatically subject the communication to privilege. Rather, only a request for legal advice or the communication thereof will be sufficient to invoke the attorney-client privilege or the work-product doctrine, and thus, careful attention should be paid to documents claimed to be subject to these privileges.