## Facts

- A discount brokerage firm and a financial software company entered a strategic alliance to create and operate an internet brokerage service.
- The brokerage later sued the software company for breach of contract and breach of fiduciary duty, alleging inadequate promotion of the joint service.
- A senior executive of the brokerage helped negotiate and implement the alliance and later joined the brokerage’s litigation team.
- The executive assisted counsel with pleadings and discovery responses and participated in privileged communications and litigation strategy discussions.
- The executive left the company and was terminated during the litigation.
- After termination, the software company subpoenaed the former executive for deposition and, without the brokerage’s knowledge, arranged an informal pre-deposition interview.
- During the interview, the software company’s attorneys warned the former executive not to disclose privileged or confidential information, including communications with the brokerage’s counsel or litigation strategy, and instructed him to decline questions that might call for such information.
- The interview focused on underlying business dealings; the record showed no disclosure of privileged attorney-client communications or litigation strategy.
- The brokerage moved to disqualify opposing counsel and to preclude use of information obtained from the interview.

## Issues

1. Whether opposing counsel may conduct an ex parte interview of an adverse corporation’s former executive who was previously exposed to privileged litigation communications.
2. Whether counsel should be disqualified or otherwise sanctioned based on the risk or appearance that privileged information might have been obtained.
3. What showing is required to justify disqualification or evidentiary preclusion in this context.

## Decision

- The court affirmed the order denying disqualification and answered the certified question in the affirmative.
- Ex parte interviews of former employees of an adverse corporate party are generally permissible when counsel does not seek or obtain privileged information.
- Disqualification and related sanctions were unwarranted because counsel employed safeguards to protect privilege and there was no evidence that privileged material was disclosed or misused.
- Speculation, a mere possibility of disclosure, or an appearance of impropriety did not justify disqualification on this record.

## Legal Principles

- Informal discovery through ex parte interviews of former corporate employees is permitted, subject to protection of the corporation’s attorney-client privilege.
- Former employees are treated differently from current employees because they no longer speak for, bind, or have their conduct imputed to the corporation in the same manner.
- Counsel must refrain from soliciting privileged communications and should take affirmative steps to prevent disclosure when contacting a former employee with potential exposure to privileged matters.
- Disqualification is a drastic remedy and requires a clear showing that the integrity of the proceeding or client confidences are threatened by actual acquisition or misuse of privileged information; appearance-based or speculative claims are insufficient.

## Conclusion

The court held that contacting and informally interviewing an adverse corporation’s former executive was permissible where counsel warned against disclosure of privileged matters and no privileged communications were shown to have been obtained, making disqualification and other sanctions improper.


Muriel Siebert & Co. v. Intuit Inc., 8 N.Y.3d 506, 868 N.E.2d 208 (N.Y. 2007)