A new (June 9, 2016) opinion from the New York Court of Appeals significantly limits claims to a common interest privilege in connection with pre-merger communications. Therefore, the opinion is drawing significant attention from corporate lawyers and litigators. Some key takeaways are provided in a June 16, 2016 post by lawyers from Cadwalader. Another summary by Proskauer lawyers also was published on June 16, 2016.  Both posts include a link to the opinion.

Set out below is the opening paragraph of the Cadwalader summary; the opinion should be read by any lawyers involved with issues arising from m&a activity.

“On June 9, 2016, a divided New York Court of Appeals in a much-anticipated ruling held that the attorney-client privilege can only be maintained for communications involving third parties in situations where litigation is pending or reasonably anticipated.  The decision reversed an intermediate appeals court’s expansion of the privilege to situations where the parties shared a “common legal interest” short of pending or reasonably anticipated litigation.  The opinion provides important guidance for corporate boards and financial advisors in determining whether sensitive information disclosed to deal parties and other members of the transaction team may have to be produced to plaintiffs in any subsequent litigations.”