The disclosure of privileged communications to a third party typically constitutes a waiver of privilege as to those communications. Exceptions to the third-party waiver rule exist, however. In Spectrum Dynamics Medical Limited v. General Electric Company, No. 18-11386 (S.D.N.Y. Sept. 9, 2021), Southern District Magistrate Judge Katharine H. Parker addressed three notable exceptions to the third-party waiver rule: (1) the essential third-party consultant exception; (2) the functional equivalent exception (which has been adopted and applied in other Circuits, but has never been recognized by the Second Circuit); and (3) the common-interest exception. In applying these exceptions, Judge Parker concluded that the disclosure of privileged communications to the third parties at issue did not waive privilege.
‘Spectrum’
Plaintiff Spectrum Dynamics Medical Limited (Spectrum) sued defendant General Electric Company (GE) for breach of contract and trade secret misappropriation. During discovery, Spectrum produced 42 emails it later determined were privileged and sought to claw back those inadvertently produced documents. 2021 WL 4131650, at *1. GE consented as to most of the emails, but challenged the attempt to claw back four of them, claiming that they included third parties and therefore, any privilege that otherwise applied to them had been waived. Id.
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