[co-author: Nathan Anderson, Law Clerk]
On October 6, the California Supreme Court heard oral argument in Los Angeles Board of Supervisors v. Superior Court, a case that we have blogged about twice in the past because of its possible impact on policyholders. On appeal, the Court will decide whether to affirm the California Court of Appeal’s decision that legal invoices sent to the County of Los Angeles by outside counsel are within the scope of attorney-client privilege and thus exempt from disclosure under the California Public Records Act. As this issue could have a major impact on policyholders’ ability to share defense bills with insurers, we attended the oral argument.
The Court appeared to favor the conclusion that most of the information contained in invoices was protected by the attorney-client privilege. Noting that information regarding litigation tactics and strategy could be gleaned from a careful review of client invoices (indeed, the ACLU wants the records for precisely this purpose: to demonstrate that the county is using “scorched earth” tactics that do not benefit the public), several Justices, including Chief Justice Cantil-Sakauye, Justice Corrigan, and Justice Liu, repeatedly expressed concern that finding that the invoices were not privileged would permit interested parties to impermissibly gain information within the scope of the privilege. Justice Chen and others also questioned whether the Court could craft a rule that would permit access to redacted invoices, as the ACLU urged the Court to do, without burdening trial courts with the difficult task of deciding whether redaction of the invoices was proper.
Despite these leanings, the Court also pressed the County regarding the scope of its proposed rule. The Court appeared very skeptical of the County’s contention that even monetary total of each bill was privileged. Justices Liu, Cuellar, and Kruger also expressed concern regarding the County’s position that, because the attorney-client privilege extends even after litigation ends, it could bar access to all information in the invoices forever, absent a waiver of the privilege. Of course, even if the Court ended up crafting a rule that would protect the invoices only during the pendency of litigation, that narrower rule would be of little use to policyholders, who are seeking to submit their defense bills promptly, for contemporaneous payment.
While the Court at several points acknowledged the importance of billing – the client wants to know what s/he is paying for, and litigation decisions are often made with cost in mind – it did so without considering the third-party payor context. Thus, neither the Justices nor counsel raised the potential risk of requiring policyholders to waive the privilege to secure payment of defense bills. Nevertheless, given several Justices’ reservations about crafting a wide-reaching rule, and the narrow scope of the question on appeal, there remains some hope that the Court will limit its holding to pending litigation and/or to litigation involving government entities, potentially leaving policyholders untouched.
Stay tuned for more analysis of this case once the California Supreme Court issues its decision in the coming months.
