2019 COA 147
Colo. Ct. App.2019Background
- EAGLE‑Net Alliance (a board‑run entity) retained Kenneth S. Fellman as general counsel and provided an Opinion Letter that prompted Affiniti Colorado, LLC to enter a management agreement.
- Affiniti later sued EAGLE‑Net, obtained a judgment, and the litigation depleted EAGLE‑Net’s assets; EAGLE‑Net was formally dissolved in 2017.
- Affiniti sued Fellman for negligent misrepresentation based on the Opinion Letter; Fellman asserted Colorado Governmental Immunity Act defenses and the attorney‑client privilege to resist discovery of communications with EAGLE‑Net.
- The district court allowed limited discovery on immunity and denied Fellman’s protective order, finding the corporate attorney‑client privilege did not survive EAGLE‑Net’s dissolution because no one remained to assert it.
- Fellman sought interlocutory review; the Colorado Court of Appeals accepted certification and affirmed, holding that the privilege ceases when (1) the corporation is dissolved, (2) no post‑dissolution proceedings remain, and (3) no one with authority to invoke or waive the privilege exists.
Issues
| Issue | Plaintiff's Argument (Affiniti) | Defendant's Argument (Fellman) | Held |
|---|---|---|---|
| Does the attorney‑client privilege survive a corporation’s dissolution? | Privilege should not shield communications once corporation is dissolved and no one remains to act. | Privilege survives like an individual’s posthumous privilege; dissolution should not extinguish it. | Privilege does not survive when corporation is dissolved, no ongoing post‑dissolution proceedings exist, and no one remains with authority to assert/waive it. |
| Can former general counsel (Fellman) invoke the corporation’s privilege after dissolution? | Affiniti: former counsel lacks authority to assert the corporate privilege. | Fellman: as former general counsel he may assert the privilege on the corporation’s behalf. | Former counsel does not have authority to invoke the corporate privilege once the corporation is dissolved and no authorized representative remains. |
| Do special public‑entity or policy considerations for an intergovernmental agency require protecting the communications? | Affiniti: public‑entity status does not change the outcome when no authorized representative remains. | Fellman: public policy and EAGLE‑Net’s public status favor preserving the privilege. | Court deemed the public‑policy argument waived (raised first on reconsideration) and did not adopt it. |
| Did the district court mishandle discovery (balance interests or conduct in‑camera review)? | Affiniti: limited discovery and disclosure order were proper. | Fellman: court should have balanced privacy interests and performed in‑camera review before ordering disclosure. | Court did not address these discovery‑management claims on interlocutory review; those arguments fall outside the C.A.R. 4.2 scope. |
Key Cases Cited
- Swidler & Berlin v. United States, 524 U.S. 399 (posthumous attorney‑client privilege for individuals)
- Wesp v. Everson, 33 P.3d 191 (Colo. 2001) (Colorado adopts posthumous privilege for individuals)
- Commodity Futures Trading Comm’n v. Weintraub, 471 U.S. 343 (privilege belongs to current corporate management; former managers cannot assert it)
- Upjohn Co. v. United States, 449 U.S. 383 (corporations communicate through agents; privilege governed by corporate structure)
- Alliance Constr. Sols., Inc. v. Department of Corrections, 54 P.3d 861 (Colo. 2002) (attorney‑client privilege principles applied to entities)
- Genova v. Longs Peak Emergency Physicians, P.C., 72 P.3d 454 (Colo. App. 2003) (corporation asserts/waives privilege through empowered individuals)