Judicial Immunity Protects Law Firm Witnesses
Counsel who practice in the area of professional liability are also watching another legal malpractice case pending before the Minnesota Supreme Court: Mahony & Hagberg, P.A. v. Newgard, 712 N.W.2d 215 (Minn. App.), review granted (June 20, 2006). The Mahoney case involves the broad immunity current or former employees of a law firm (or of a service provider) may have as witnesses when they testify about any issue that has "some relationship to or connection with an issue in the case." Defense counsel in legal malpractice actions should be alert for release of privileged client information in such instances and quick to seek judicial protection should such a leak occur.
The issue before the Court of Appeals was the extent to which judicial immunity protects a witness who had worked in a law firm. The witness, Tracy Newgard, was a legal assistant employed by a corporation, PAL, which provided legal services for a law firm. Ms. Newgard was terminated when PAL could no longer afford to pay her and she was owed over $6,000.00 in wages at the time of her termination. One of the partners of the law firm had loaned her $2,000.00 from the firm until she received her back wages.
Meanwhile, PAL became embroiled in litigation when the principals of the corporation disagreed about ownership interests. Ms. Newgard was contacted by an attorney for one of the owners and signed an affidavit which included a description of office conduct involving attorney Michael Mahoney, who had asked her to help with a scheme to incorporate many companies for a client to lower the client’s tax burden.
The firm and PAL sued Ms. Newgard for breach of confidences, invasion of privacy, civil conspiracy, and money owed. The primary allegations against Ms. Newgard were that she violated attorney/client privilege through disclosure of office events involving specific clients. Ms. Newgard sought to have the litigation against her dismissed based on the doctrine of judicial immunity, but the district court denied her request.
The Court of Appeals, in its review, examined the history of judicial immunity and noted that it was extended not only to judges, attorneys and parties, but also to witnesses. The public policy behind the doctrine seeks to encourage witnesses to testify fully in order to find the truth. The only restriction to immunity is that the evidence offered must have "some relationship to or connection with an issue in the case, although that connection need not amount to legal relevance." Mahoney & Hagberg, 712 N.W.2d at 219, citing Matthis v. Kennedy, 243 Minn. 224, 224-45, 67 N.W.2d 413, 417-18 (1954).
While other jurisdictions have held that immunity protects witnesses from all torts, in Minnesota the doctrine has previously only been applied to claims of defamation. The Court of Appeals in this instance found that the public policy reasons for granting immunity to a witness "also apply with equal force to other torts that arise from a person’s participation in the judicial process" – but found that the primary claims against Ms. Newgard were essentially defamation claims and "are the sorts of claims to which judicial immunity should apply." Mahoney & Hagberg, 712 N.W.2d at 220. The Court of Appeals held that Ms. Newgard was immune from liability for the claims of breach of confidentiality, civil conspiracy, and invasion of privacy and reversed the trial court’s ruling to the contrary. The claim for money owed, however, was unrelated to the testimony and hence there was no immunity against that claim.
The Court of Appeals side-stepped the allegations that Ms. Newgard’s testimony breached the attorney/client privilege. Although the Court failed to note that the claims had not been brought by the clients allegedly harmed, it did comment that the privilege did not extend to communications which furthered criminal or fraudulent conduct. Although the Court found it "unclear whether that exception would apply" to the information in Ms. Newgard’s affidavit, it held that any potential harm in such a breach could be contained by the district court’s ability to seal the record, and held that any harm to a single individual would be outweighed by the court’s interest in protecting the integrity of the process. Mahoney & Hagberg, 712 N.W.2d at 221.
The Minnesota Supreme Court granted review and heard arguments back on November 7, 2006. The tenor of the questions at oral argument suggest that the Supreme Court will take a critical look at the firm’s allegations that attorney/client privileges were breached.
Current Status of the Law
While the Supreme Court decision may clarify some of the loose ends left by the Court of Appeals, the Mahoney & Hagberg decision as it currently stands outlines a developing area in professional liability litigation. When witnesses include current or former employees of the firm (or of a service provider), they have broad immunity for testifying about any issue that has "some relationship to or connection with an issue in the case." This may include evidence which involves clients other than the ones involved in the malpractice litigation. While there are probably few cases in which such evidence would be even arguably relevant, such information could be used by either party to the litigation. The defense, however, would be wise to be alert for release of privileged client information – and quick to seek judicial protection should such a leak occur.
You should consult legal counsel before making any attempt to apply the law or any information offered above to your own specific situation. Factual differences may result in substantial differences in the application of the law. This article was authored by Diane Odeen, a professional liability attorney, who practices in both Minnesota and Wisconsin. Click here to find out more about Ms. Odeen's practice. For more information about legal malpractice-related issues, contact Diane Odeen at 612-336-9315, 715-381-7112 or firstname.lastname@example.org.