CFTC v. Weintraub
Citation
471 U.S. 343 (1985). Supreme Court of the United States.
Facts
A corporation filed for bankruptcy. The bankruptcy trustee sought to examine the corporation’s former attorney and to waive the corporation’s attorney-client privilege over communications between that attorney and former corporate officers. The former officers objected, claiming the privilege was theirs to hold, not the trustee’s to waive.
Issue
When a corporation is in bankruptcy, does the power to waive the corporation’s attorney-client privilege belong to the bankruptcy trustee or to the corporation’s former officers?
Holding
The Court held that the bankruptcy trustee, not the former officers, holds the power to waive the corporation’s attorney-client privilege. The trustee steps into the shoes of the corporation’s management and exercises the corporation’s legal rights, including control over its attorney-client privilege.
Rule / Doctrine
The attorney-client privilege belongs to the client — the corporation — not to individual officers or directors. In a solvent corporation, the board of directors controls the privilege on behalf of the corporation. When a trustee is appointed in bankruptcy, the trustee assumes control of the corporation’s affairs and thus its privilege. Former officers have no independent right to assert or waive the corporation’s privilege. This principle extends the holding of Upjohn Co. v. United States: corporate counsel’s communications run to the corporation, not to individual employees.
Significance
Weintraub is essential for understanding who controls the corporate attorney-client privilege. It has significant implications for corporate attorneys whose clients enter bankruptcy and for the scope of privilege when corporate control changes hands.