In Buckley, LLP v Series 1 of Oxford Ins. Comp., the North Carolina Supreme Court (per curiam) upheld a Business Court decision finding that records of an internal company investigation, even if carried out by an attorney, are not necessarily protected by the attorney-client privilege.
The court cited previous North Carolina cases for the proposition that “investigations of alleged violations of company policy . . . are ordinary business activities and . . . not necessarily ‘made in the course of giving or seeking legal advice’” and therefore not necessarily privileged. Instead, the court approved the Business Court’s decision to review individual documents and to allow a privilege claim only for those that “reflect a primary purpose of giving or receiving legal advice.”
So, if your locality has an investigation to conduct, don’t assume that having the in-house attorney or outside counsel conduct the investigation will shield records of the investigation from discovery on the basis of privilege. You may be better off having one group do the investigation – whether lawyers or another organization that specializes in these investigations – and having the report reviewed by counsel. Separating the roles will make the privilege line cleaner.
Here’s a story from Reuters discussing the case.
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