Commercial Litigation and Arbitration

No Adverse Inference from Assertion of Attorney-Client Privilege

From United States v. St. John, 267 F. App’x 17, 22 (2d Cir. 2008):

We also reject defendants' argument that it was improper for Cherry and Raymond to assert the attorney-client privilege outside the presence of the jury on the basis that they were entitled to an adverse inference because of the witnesses' invocation of the privilege. There is nothing in our case law to suggest that such an assertion of privilege must be made in the presence of the jury. Indeed, in the civil context, we have held that there is no basis for the jury to draw an adverse inference because of the assertion of the attorney-client privilege. See Nabisco, Inc. v. PF Brands, Inc., 191 F.3d 208, 226 (2d Cir. 1999) ("[W]e know of no precedent supporting such an [entitlement to an adverse] inference based on the invocation of the attorney-client privilege."), abrogated on other grounds, Moseley v. V Secret Catalogue, Inc. , 537 U.S. 418, 123 S. Ct. 1115, 155 L. Ed. 2d 1 (2003).

To the same effect, see Knorr-Bremse Systeme Fuer Nutzfahrzeuge GmbH v. Dana Corp., 383 F.3d 1337, 1344-1345 (Fed. Cir. 2004) (citing cases); In re Tudor Associates, Ltd., II, 20 F. 3d 115, 120 (4th Cir. 1994) ("A negative inference should not be drawn from the proper invocation of the attorney-client privilege."); United States v. United Techs. Corp., 2005 U.S. Dist. LEXIS 46731, *9-*10 (S.D. Ohio Feb. 2, 2005); Anascape, Ltd. v. Microsoft Corp., 2008 U.S. Dist. LEXIS 111828 (E.D. Tex. Apr. 25, 2008).

In contrast, in civil cases, many courts permit an adverse inference from assertion of the Fifth Amendment privilege against self incrimination. See Nabisco, 191 F.3d at 226.

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