Week Ending 10/25/13: Hedden v. Kean University

Alan Schorr’s Employment Case of The Week ending October 25, 2013

Hedden v. Kean University, __ N.J. Super. __ , 2013 WL 5745201, (N.J. App. Div., October 24, 2013)

The New Jersey Appellate Division strengthened the attorney-client privilege over a strong dissent which pointed out both factual and legal inconsistencies in the majority’s decision. The essence of the opinion involved whether a letter sent from Kean’s basketball coach to the University’s general counsel was protected by attorney-client privilege. The analysis was fact-intensive, which is why it is important that the dissent argues that the majority omitted key facts which should have changed the analysis.

Glenn Heddon is the former athletic director at Kean University. Michele Sharp, the head women’s basketball coach, worked under him. The University ended up being sanctioned because Coach Sharp allegedly violated NCAA rules. Kean terminated Heddon supposedly for failure to properly supervise his coach. It was actually Heddon that reported Sharp’s violations to the NCAA and Heddon sued Kean, alleging that his termination violated the New Jersey Conscientious Employee Protection Act (CEPA) for reporting those violations.

Sharp had organized a summer trip to Spain which included both academic and educational components. Sharp had drafted a letter to be sent to potential donors. Before releasing the letter, she sent it to the University’s general counsel, Michael Tripodi, requesting his review. Tripodi responded only orally. Heddon was never told about the trip, and when he found out, he believed that NCAA violations had occurred and reported them to the NCAA, which conducted an investigation. During that investigation, Sharp produced, without objection from Kean, the letter she wrote to Tripodi.

During discovery, Heddon requested a copy of the letter and the University refused, citing attorney-client privilege. Heddon objected, pointing out that the letter was not included in any privilege logs, and that regardless, the privilege was waived by its production to the NCAA. Kean argued that Sharp was not the holder of the privilege and had no right to waive the privilege. Heddon moved to compel, and the motion judge, after reviewing the letter in camera, found that the reason for sending the letter was not to obtain legal advice, and that even if privileged, the privilege was waived. On reconsideration, the motion judge agreed that the letter was privileged, but that the privilege had been waived.

The Appellate Division agreed to hear Kean’s interlocutory appeal, and, in a published opinion, reversed. The Appellate Division confirmed that the attorney-client of an organization extends to its agents, which the corporation must work through, including mid or low-level employees. Recognizing that the attorney-client privilege is not sacrosanct, the Court still granted a presumption that a communication made in the lawyer-client relationship has been made in confidence. Therefore, the Appellate Division determined that it would have to decide factually what the actual purpose of the letter was. The majority determined that the primary purpose was to seek legal advice, and therefore it was privileged. The majority also determined that Kean did not waive the privilege by failing to assert the privilege during the NCAA investigation.

The very best part of this opinion is the dissent written by Judge Michael Guadagno, who, coincidentally is the husband of Lieutenant Governor Kim Guadagno. Apparently, there is no conflict of interest or appearance of impropriety in a Judge ruling in a case against a State where the Judge’s wife happens to be the Lieutenant Governor. In any event, Judge Guadagno’s opinion was in no way favorable to the State. Judge Guadagno recited numerous interesting facts about the underlying case which the majority omitted.

Most amazing is that Judge Guadagno, in his dissent, actually recites the content of the privileged letter verbatim. Judge Guadagno states that “Sharp’s only request to Tripodi was, ‘Please let me know if it is worded ok.’” Thanks Judge. We just litigated and won an appeal to keep the privileged letter privileged, and you just spilled the beans and disclosed the only legal request that Sharp had made. Might as well release the rest of the letter now, huh?

Judge Guadagno reasoned that asking if the letter is “ok” is not a request for legal advice. He concluded that there is no support in the record that either party had a reasonable expectation that the email would remain confidential. Judge Guadagno, however, stakes the contrary position, which I believe is the majority position of Courts in New Jersey that “documents do not become cloaked with the lawyer-client privilege merely by the fact of their being passed from client to lawyer.” Therefore, he correctly stated, “the general rule is while legal advice given to a client by an attorney is protected by the privilege, business advice is not.” The dissent strongly disagreed that the letter was privileged, and that even if privileged, that privilege had been waived by the University.

But my favorite line in the entire dissent:

The attorney-client privilege should not be the subject of such arbitrary, selective, and opportunistic enforcement and cannot be doffed and donned like a raincoat on a cloudy day.

Such a stinging dissent would normally provide an automatic appeal to the State Supreme Court. However, since this was an interlocutory appeal to the Appellate Division, the Plaintiff would still have to seek leave for Supreme Court review. We will keep an eye on this one.

Plaintiffs’/Respondent’s Counsel: David F. Corrigan, Bradley D. Tishman, The Corrigan Law Firm.

Defendants’/Appellants’ counsel: Michael J. Dee, John J. Peirano, Melanie D. Lipomanis, McElroy, Deutsch, Mulvaney & Carpenter, LLP.

Superior Court Judge - Kenneth J. Grispin, J.S.C.

Appellate Division Judges: Parillio (for the majority), Harris, and Guadagno (dissenting).

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