Suburban Sew 'N Sweep, Inc. v. Swiss-Bernina, Inc.
F.R.D. 254 (1981)
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Rule of Law:
The attorney-client privilege is waived for confidential documents when the party asserting the privilege fails to take reasonable precautions to maintain their confidentiality, such as by placing them unshredded into a trash container accessible to third parties.
Facts:
- Plaintiffs Suburban Sew ’N Sweep, Inc. and Howard Perk operated retail stores selling products manufactured and distributed by defendants Swiss-Bernina, Inc. and Fritz Gegauf, Ltd.
- Suspecting defendants of antitrust violations, plaintiffs began searching a trash dumpster located at Swiss-Bernina's office building in August 1977, a practice that continued for over two years.
- The dumpster was for the exclusive use of Swiss-Bernina.
- In 1979, the president of Swiss-Bernina wrote several confidential letters to the company's corporate counsel.
- Handwritten drafts of these letters were placed in office wastebaskets, which were then emptied into the trash dumpster.
- Plaintiffs recovered these handwritten drafts from the dumpster.
- Defendants expected these communications to remain confidential.
Procedural Posture:
- Plaintiffs Suburban Sew 'N Sweep, Inc. and Howard Perk filed suit against defendants in federal district court, alleging violations of federal antitrust laws.
- During discovery, plaintiffs served interrogatories on defendants concerning documents plaintiffs had recovered from defendants' trash.
- Defendants refused to answer interrogatories related to four documents, claiming they were protected by the attorney-client privilege.
- Plaintiffs filed a motion before a Magistrate Judge to compel defendants to answer.
- The Magistrate Judge sustained defendants' objections, ordered plaintiffs to return all documents recovered from the trash, and barred their use in the litigation.
- Plaintiffs filed timely objections to the Magistrate Judge's order, bringing the matter before the District Court for review.
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Issue:
Does placing otherwise privileged attorney-client communications into a trash dumpster, from which they are later recovered by an opposing party, destroy the confidentiality required to maintain the privilege?
Opinions:
Majority - Leighton, District Judge.
Yes. The attorney-client privilege is vitiated when a party fails to take reasonable steps to ensure and maintain a document's confidentiality. The privilege is intended to protect confidentiality, but it must be strictly construed because it is in derogation of the public's right to evidence. The court found that this case falls between inadvertent public disclosure and involuntary disclosure (theft from a secure location). The key consideration is the intent of the defendants to maintain confidentiality as manifested by the precautions they took. Here, the risk of a third party searching through garbage is not so great as to deter open attorney-client communication. Furthermore, if defendants feared such disclosure, they could have easily prevented it by destroying the documents, for example by shredding them, before disposal. By failing to take such simple, reasonable precautions, they did not adequately maintain the confidentiality of the communications, and the privilege was therefore lost.
Analysis:
This decision clarifies that the attorney-client privilege is not absolute and requires the holder to take affirmative, reasonable steps to maintain confidentiality. By extending the concept of waiver to documents discarded as trash, the court placed a practical burden on parties to secure sensitive information. The ruling serves as a significant warning that simply disposing of documents does not protect them from discovery if found by an adversary. This precedent reinforces the principle that the privilege must be actively guarded and has influenced corporate policies regarding document destruction and information security.
