I recently heard a panel of judges speak about e-discovery issues. Their opinions on several subjects varied, but on one subject they agreed unanimously: Clawback provisions under Federal Rule of Evidence 502 are valuable tools in most significant litigation, but they remain rarely used.

This piqued my interest, so I asked several in-house litigators (not necessarily at the place where I work) whether they routinely seek FRE 502 clawback provisions in their cases. The in-house lawyers do not. And I asked whether outside counsel routinely recommend seeking those provisions. Not surprisingly (because the in-house folks aren’t using them), outside counsel do not.

The judges think clawback provisions are a good idea; in most situations, it strikes me that the judges are right. So what are FRE 502 clawback provisions, and why are inside and outside counsel routinely missing this trick?

In a nutshell, FRE 502 now provides that the disclosure of attorney-client or work product information in a federal proceeding does not waive either privilege, so long as (1) the disclosure was inadvertent, (2) the holder of the privilege took reasonable steps to prevent the disclosure, and (3) the holder promptly took reasonable steps to rectify the error. The Advisory Committee Notes explain that Rule 502 “contemplates enforcement of ‘claw-back’ and ‘quick peek’ arrangements as a way to avoid the excessive costs of pre-production review for privilege and work product.” Under a clawback agreement, the parties can agree (and a court can order) that, if a party inadvertently produces a privileged document, the receiving party must return it. This eliminates the need for the producing party to take “reasonable steps” (or, in some cases, any steps) to prevent the disclosure of the privileged information. If a privileged document is inadvertently disclosed, the document must be returned, period.

If a federal court enters a clawback order, FRE 502(d) provides that the order can prevent the inadvertent disclosure from being a waiver not just between the parties to the agreement, but also “in any other Federal or State proceeding.” Thus, for maximum effect, parties should typically ask federal courts to enter clawback orders to give the broadest protection to the attorney-client and work product privileges in case of inadvertent disclosure.

Naturally, the need to enter these orders will occasionally raise controversies. In asymmetrical litigation — where one party possesses few electronic documents, and the other side possesses many — the party less concerned with inadvertently producing privileged documents may oppose entering a clawback order. But that shouldn’t stop the player with voluminous e-documents from applying to a court for help.

Indeed, one of the judges on the panel that I attended suggested that a law firm’s failure to request a clawback agreement (or order) might someday be used as evidence of malpractice if the firm later inadvertently disclosed a privileged, and highly sensitive, document. When a federal judge speaks those words, counsel should listen.

Why do many litigators frequently miss the clawback trick? Perhaps because the clawback provisions appear in the Federal Rules of Evidence, rather than the Federal Rules of Civil Procedure. Before folks trot down to court for a Rule 16 pretrial conference, they look at Rule 16, think about initial disclosures and the scope of discovery, negotiate the required deadlines, and do the other stuff mandated by Rule 16. But clawback provisions are hidden in the Federal Rules of Evidence, so the Rules of Civil Procedure never force litigators to focus on them during the pretrial process.

Outside lawyers should stop missing this trick. They ought to add “consider a clawback provision” to the standard lists of items — jurisdiction, venue, affirmative defenses — that they consider in every case. And inside lawyers should do the same. Raise the issue when outside counsel overlook it, and insist that outside counsel think about this in all future cases.

Someday, when you inadvertently disclose a privileged document, you’ll be glad that you put Rule 502 clawback provisions on your list of items to consider in every case.


Mark Herrmann is the Vice President and Chief Counsel – Litigation at Aon, the world’s leading provider of risk management services, insurance and reinsurance brokerage, and human capital and management consulting. He is the author of The Curmudgeon’s Guide to Practicing Law (affiliate link). You can reach him by email at [email protected].


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