A Perilous “Advice of Counsel” Defense Results in Disclosure

Houston Medical Times May 2017

Stuart M. Gerson, a Member of the Firm in the Litigation and Health Care & Life Sciences practices, in the firm’s Washington, DC, and New York offices, authored an article in the Houston Medical Times, titled “A Perilous 'Advice of Counsel' Defense Results in Disclosure.”

Following is an excerpt (see below to download the full article in PDF format):

Parties in both civil and criminal cases where fraud or corporate misconduct is being alleged frequently attempt to defend themselves by arguing that they lacked unlawful intent because they relied upon the advice of counsel. Such an assertion instantly raises two fundamental questions: 1) what advice did the party’s attorney actually give?; and 2) what facts and circumstances did the party disclose, or fail to disclose, in order to obtain that opinion? To answer these questions, it is well understood that raising an advice of counsel defense consequently waives attorney/client privilege. But what about the so-called “attorney work product” doctrine? While attorney/client privilege protects confidential communications between clients and their lawyers related to seeking or obtaining legal advice, attorney work product is protected because it includes the analyses and strategies prepared by and for the attorneys themselves in anticipation of litigation or other adversarial engagements.

Should assertion of advice of counsel expose the attorney’s work product to discovery? A cautionary analysis of that question was provided recently in the District of South Carolina, where the defendants in a False Claims Act lawsuit who asserted an advice of counsel defense were ordered to hand over to government prosecutors all attorney communications related to an alleged Medicare kickback scheme. United States ex reI. Lutz v. Berkeley Heartlab, Inc., 2017 BL 111755, D.S.C., No. 9:14-cv-230, April 5, 2017).