United States: Personnel Investigation By Outside Attorney Protected From Disclosure In Discovery

Seyfarth Synopsis: California Court of Appeal holds that (1) an outside attorney's investigation can be privileged even though the attorney simply investigated facts, and (2) the employer does not waive the privilege simply by asserting an "avoidable consequences" defense in litigation.

The recent decision in Waters v. City of Petaluma is a welcome development for employers who retain outside attorneys to perform personnel investigations, as it provides greater assurance that those investigations will be protected from disclosure in discovery.

The Facts

Andrea Waters was a firefighter for the City of Petaluma. She claims that she was subjected to sex harassment and discrimination during her employment, and that she was retaliated against when she complained about it. She resigned from the Petaluma Fire Department three days after filing a charge with the EEOC in 2014.

The City Attorney, in response to the EEOC charge, retained an outside attorney to investigate the charge and to help the City prepare to defend the anticipated lawsuit. The retention agreement required the attorney to "tell [the City] what we believe happened, and the basis for that conclusion," and to arrive at "findings based on an impartial and professional evaluation of the evidence." The agreement stated that it created "an attorney/client relationship" between the City and the attorney investigator, that the investigation would be subject to the attorney-client privilege, and that the attorney would use "employment law and investigation expertise to assist you in determining the issues to be investigated and conduct impartial fact-finding." The agreement did not, however, ask the attorney to advise the City on what to do in response to Waters's EEOC complaint, stating: "we will not render legal advice as to what action to take as a result of the findings of the investigation."

The attorney provided a written investigation report to the City, and the City preserved the confidentiality of the report, as well as all the supporting work product. Each page of the report stated that it is confidential and attorney-client privileged.

When Waters sued the City—claiming sexual harassment, discrimination based upon sex, retaliation, and failure to prevent harassment, discrimination, and retaliation—the City asserted various affirmative defenses, including avoidable consequences. That defense asserted that the plaintiff had unreasonably failed to make use of the preventive and corrective measures regarding workplace harassment that the employer had provided, and that if the plaintiff had done so, she would have prevented the harm that she allegedly suffered.

Waters then sought to discover documents relating to the City's investigation, including the investigator's report. The City objected, raising the attorney-client privilege and the work product doctrine. Waters moved to compel production, arguing that the investigation was not privileged, and that any privilege was waived in any event when the City placed the investigation at issue by pleading the avoidable consequences defense.

The trial court granted the motion to compel, reasoning that the investigation and report were not attorney-client communications, because the investigator's retention agreement specified that she would not render legal advice to the City. The trial court also concluded that any privilege had been waived because the City put the investigation at issue by pleading avoidable consequences.

The Appellate Court Decision

The Court of Appeal reversed the trial court's ruling. First, the Court of Appeal recognized that an attorney-client relationship may exist when an attorney provides a legal service without also providing legal advice. The Evidence Code defines a "client" for purposes of the attorney-client privilege and the work product doctrine. A "client" is a person who retains a lawyer for securing "legal service or advice" in the attorney's professional capacity.

The Court of Appeal noted that the City retained an outside attorney to provide a "legal service" because the investigator was hired to use her legal skills to assist the City in developing a response to an EEOC complaint and anticipated lawsuit. The retention agreement expressly created an attorney-client relationship and also directed the investigator to use her employment-law expertise to make findings based upon her "professional evaluation of the evidence." She was not simply to gather facts and transmit them to the City. Rather, "she was expected to use her legal expertise to identify the pertinent facts, synthesize the evidence, and come to a conclusion as to what actually happened." The purpose of her representation was to provide "legal service" to help the City Attorney advise the City on the appropriate course of action. The conclusion that the investigation constituted the provision of legal services to a client was reason to apply both the attorney-client privilege and the work product doctrine.

The Court of Appeal also determined that assertion of the avoidable consequences defense did not waive any privilege associated with an investigation that occurs after the employee has left employment. "[T]he assertion of an avoidable consequences defense does not put a post-employment investigation directly at issue in the litigation." Rather, the avoidable consequences defense implicates only what the employer and employee did or did not do while the employee remained employed. The City was not relying on its post-employment investigation as part of its avoidable consequences defense. Therefore, the Court of Appeal held that the City's assertion of the avoidable consequences defense did not waive any attorney-client or work product protection afforded to the outside attorney's post-employment investigation.

What City of Petaluma Means for Employers

Plaintiffs regularly seek discovery regarding an employer's prelitigation investigation, hoping to leverage the employer's industry and efforts and to mine investigative findings to use against the employer in litigation. City of Petaluma provides greater assurance to employers that those investigations will be protected from disclosure in discovery, and also provides useful guidelines for employers to follow when retaining an outside attorney to conduct a personnel investigation. Employers should carefully review their retention agreement with outside counsel who conduct investigations to make sure that the agreement provides that the parties intend to create an attorney-client relationship and that the attorney investigator is providing a legal service to the employer, if not also providing legal advice.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.