WAIVER OF PRIVILEGE UNDER FEDERAL EVIDENCE RULE 502 AND ARBITRATION PROCEEDINGS
I. Rule 502 of the Federal Rules of Evidence
Rule 502 of the Federal Rules of Evidence deals with the attorneyclient privilege, the attorney work product rule, and the limitations on waiver of protections from disclosure. Rule 502(b) provides that a disclosure will not result in a subject matter waiver in a federal or state proceeding if:
(i) the disclosure is inadvertent; (ii) the holder of the privilege or protection took “reasonable steps” to prevent disclosure; and (iii) the holder “promptly” took “reasonable steps” to rectify the error.
Federal Rule of Evidence 502, which was amended in 2007 to develop a uniform treatment of intentional and inadvertent disclosure of privileged information in arbitration and court-related arbitration, provides guidance for practitioners on how to prevent a court from finding a subject matter waiver as a result of an inadvertent production of a privileged document. In addition to analyzing the amended rule, this chapter discusses recent case law suggesting that the amended rule applies to private arbitration as well. Despite the best efforts of litigants to avoid disclosing privileged documents, mistakes may occur when a case involves an excessively large number of documents. The concern is that inadvertent disclosure of a