N.M. Court Finds Business Advice Trumps Attorney-Client Privilege For GC

A New Mexico appeals court invalidated attorney-client privilege for a general counsel’s memo that provided a strategy for for terminating two physician employees of a hospital corporation. When the employees sued the hospital, the New Mexico court adopted the primary purpose standard in considering the memo, stating that the privilege does not apply “if the primary purpose of a communication is to solicit or render advice on non-legal matters.” In its ruling, the court wrote: “A court faced with a situation where the primary purpose of a communication is not clearly legal or business advice should conclude the communication is for a business purpose, unless evidence clearly shows that the legal purpose outweighs the business purpose.”