Last Friday, I wrote about one of the docketed appeals in Wynn Resorts, Limited v. Eight Jud. Dist. Ct., 41 Nev. Adv. Op. 52 (2017). Today's post concerns the other docketed appeal in that case. This appeal addressed whether disclosure of an internal investigation results in a waiver of the attorney-client privilege. To recap, the case involves a redemption by Wynn Resorts of the shares held by a group referred to as the "Okada Parties". This was no small matter. Wynn Resorts paid for the shares with a $1.6 billion promissory note, which the Okada Parties claimed represented only a fraction of the value of the redeemed shares. Wynn Resorts board authorized the redemption after receiving a report from former federal judge and FBI director Louis Freeh and his firm. Perhaps anticipating that the Okada Parties would not be happy with the redemption, Wynn Resorts the next day filed a complaint against the Okada Parties for declaratory relief, breach of fiduciary duty, and aiding and abetting breach of fiduciary duty. The complaint attached the report by Freeh's firm and stated that the board had relied on it. Wynn Resorts also filed a Form 8-K with the Securities and Exchange that included the complaint and report as exhibits.
Writing for the court, Justice James W. Hardesty agreed with the trial court that Wynn Resorts waived the attorney-client privilege with respect to the report by filing a complaint seeking declaratory relief with respect to the board's business decision, attaching the report to the complaint and providing the information to a regulatory agency. The Supreme Court, however, found that some of the documents may be protected by the work product doctrine. The trial court had not applied the work product doctrine because the investigation was not done in anticipation of litigation. The Supreme Court directed the trial court to employ the "because of" test to determine whether the report was created in anticipation of litigation.
This highlights one of the important distinctions between the attorney-client privilege and the work product doctrine: "selective disclosure of work product to some, but not to others, is permitted". Thus, even though the Supreme Court agreed with the trial court that the attorney-client privilege had been waived, the Supreme Court left open the possibility that some of the documents might be protected by the work product doctrine.