Chancery Denies Motion to Compel Director’s Privileged Communications Stored on Third-Party’s Email Server | Morris James LLP

In Re Dell Technologies Inc Class V Stockholders Litigation, Consol. C.A. No. 2018-0816-JTL (Del. Ch. Sept. 17, 2021) (TRANSCRIPT)

A director using an e-mail account related to a special firm for board service communications may unintentionally compromise in any other case privileged communications. Here, a member of Dell’s board of administrators served on a particular committee and utilized an e-mail account related along with his former employer to talk with the committee’s legal professionals. Plaintiff moved to compel the manufacturing of in any other case privileged communications on his account, elevating the query of whether or not the director had an affordable expectation of privateness in his communications.

The Court of Chancery analyzed the difficulty using the 4 Asia Global components: i.e., 1) whether or not there’s discover to worker that employer could monitor the communications; 2) the extent to which the employer really engages in monitoring; 3) whether or not third events have the correct to entry the communications; and 4) whether or not the worker was conscious of the insurance policies.

The Court emphasised that these privilege inquiries are extremely truth particular, turning on the language of employer insurance policies and the actions of the consumer. Here, the Court decided that the director was entitled to assert privilege as a result of he had an objectively cheap expectation of privateness. The language of his former employer’s coverage was much less stringent, as an illustration, than the coverage at challenge within the WeWork determination, which explicitly acknowledged there was no expectation of privateness. The coverage distinguished using private or personal emails famous by topic line and explicitly contemplated using the area for private communications. While the corporate maintained the correct to monitor all communications, the Court discovered this language tended towards manufacturing. Although the director didn’t label his communications as private, the Court discovered that the connection of the director to his former firm indicated that every one of his communications can be private in nature, as he now not labored for the corporate and was utilizing the account as a retirement perk for non-company issues.

Finally, the Court cautioned {that a} finest follow for out of doors administrators could also be to set up personal e-mail addresses to conduct board enterprise, noting that if the director had used a personal account, he may have prevented this dispute.