Key Takeaways
- • Vorys, a Columbus, Ohio-based law firm with nearly 375 attorneys across seven offices, published a white paper from its M&A and Private Equity Groups on who controls attorney-client privilege in mergers and acquisitions.
- • Courts have increasingly held that privilege protection for pre-closing communications may be limited or lost if selling parties fail to address privilege ownership in the definitive agreement.
- • Parties typically give little attention during M&A negotiations to whether confidential communications with their attorneys could pass to the buyer after closing.
- • The white paper frames the central issue as the "who and whose" of the privilege, meaning which party owns the privilege and which attorney-client relationship it attaches to.
Summary
Vorys has published a white paper, authored by members of its M&A and Private Equity Groups, addressing the ownership of the attorney-client privilege in mergers and acquisitions. According to the firm's publisher summary, parties in M&A transactions generally devote little attention during negotiations to whether their confidential communications with counsel could end up in the other party's hands after closing.
The publisher summary states that courts over the past several years have cautioned that privilege protection may be limited in certain M&A circumstances, or lost altogether, if selling parties do not expressly address the privilege's ownership in the definitive agreement. To preserve privilege over pre-closing communications, the firm argues that parties need to understand the "who and whose" of the privilege.
Publisher-site materials associated with the white paper note that in most M&A deals the sell-side law firm's client is the target company, and that purchase agreements may permit target company counsel to represent selling stockholders after closing, including in disputes with the buyer. Related guidance also notes that change-in-control transactions can raise complicated privilege questions if litigation arises, and that Delaware-law-governed mergers should expect privilege and work product in target company files to be addressed in the deal documents.
The white paper is available for download on the Vorys website. Vorys was founded in 1909 and ranks among the 200 largest U.S. law firms according to American Lawyer magazine.
The publisher summary states that courts over the past several years have cautioned that privilege protection may be limited in certain M&A circumstances, or lost altogether, if selling parties do not expressly address the privilege's ownership in the definitive agreement. To preserve privilege over pre-closing communications, the firm argues that parties need to understand the "who and whose" of the privilege.
Publisher-site materials associated with the white paper note that in most M&A deals the sell-side law firm's client is the target company, and that purchase agreements may permit target company counsel to represent selling stockholders after closing, including in disputes with the buyer. Related guidance also notes that change-in-control transactions can raise complicated privilege questions if litigation arises, and that Delaware-law-governed mergers should expect privilege and work product in target company files to be addressed in the deal documents.
The white paper is available for download on the Vorys website. Vorys was founded in 1909 and ranks among the 200 largest U.S. law firms according to American Lawyer magazine.
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