Putting the Genie Back in the Bottle: Lawsuit by Former Producer Raises Bevy of Attorney-Client Privilege Issues

We are all familiar with the defamation suit brought by Dominion Voting Systems against Fox News challenging statements of Fox hosts and guests concerning claimed election fraud. Lawsuits filed last week by Abby Grossberg, a now former Fox News producer, against Fox claims that she was “schooled” by Fox’s outside counsel at Winston & Strawn to provide false and misleading testimony in preparation for her deposition in the Dominion litigation. If they proceed, these suits are likely to raise important issues concerning the application of the attorney-client privilege during meetings – including meetings to prepare to testify at depositions and trial – between employee witnesses and company and outside counsel.

Over the past ten days, there have been almost daily developments in the new Grossberg litigation. To put her allegations in context in a dispute that has spanned over four years, we provide a brief timeline:

• March 2019: Grossberg joins Fox News as a Senior Booking Producer for Sunday Morning Futures with Maria Bartiromo.
• November 2020: Fox projects that former President Trump lost the 2020 Presidential Election and offers theories from on-air guests about Dominion’s involvement in election fraud, including interviews of Sidney Powell, Trump campaign attorney, and former President Trump himself.
• March 2021: Dominion sues Fox in Delaware state court for defamation relating to Fox’s reports that Dominion rigged the 2020 presidential election.
• Spring 2022: Grossberg is informed she will be deposed in connection with the Dominion lawsuit.
• August 10, 2022: Grossberg sits for her first day of deposition preparation, during which Fox attorneys allegedly coached her to give evasive and untruthful answers to questions.
• September 14, 2022: Grossberg is deposed by Dominion’s attorneys. Grossberg claims Fox attorneys did not provide to her a copy of the transcript to review and correct.
• January 12, 2023: Grossberg raises concerns about gender-based harassment and discrimination to her superiors at Fox. Hours later, Fox supervisors told her to meet with Fox HR to discuss her “performance problems.” During this meeting, she was “berated” her about her complaints.
• January 17, 2023: Dominion files a motion for summary judgment in the Dominion litigation, citing portions of Grossberg’s deposition testimony, including Grossberg’s confirmation that Fox News “is a news show” and the following question and answer: “Q: If someone says something untrue on one of your shows, do you think it’s important to correct it? A: No.”
• January 25, 2023: Grossberg requests a copy of her deposition transcript, asserting her testimony was “not the testimony [she] wanted to give but she had been conditioned and felt coerced to give this response.”
• February 17, 2023: Grossberg, through counsel, requests the transcript a second time. Fox’s counsel provided a copy of the transcript to her counsel several weeks later.
• March 20, 2023: Grossberg sues Fox in federal court in New York and state court in Delaware, alleging discrimination, retaliation, and violations of New York equal pay laws. Later that same day, Fox sues Grossberg in New York state court to enjoin her from disclosing privileged communications between Grossberg and Fox attorneys.
• March 21, 2023: Fox drops its suit against Grossberg in New York state court.
• March 22, 2023: Fox files an emergency motion in federal court to seal allegedly privileged communications between Grossberg and Fox attorneys during the deposition preparation session. The next day, the motion was denied by the court, finding the “genie was already out of the bottle.”
• March 24, 2023: Fox terminates Grossberg for disclosing privileged information in her complaints.
• March 27, 2023: Grossberg files amended complaint in federal court in NY claiming that Fox fired Grossberg in retaliation for her lawsuit.

The Underlying DVS/Fox Litigation

In March 2021, Dominion sued Fox in Delaware state court for defamation, alleging that the network knowingly spread “fake news” about its voting machines to improve the show’s floundering ratings. In its complaint. Dominion alleged it was defamed by four types of lies: (1) Dominion rigged the election; (2) it used algorithms to manipulate vote counts; (3) it was owned by a Venezuelan company that rigged elections for former President Hugo Chavez; and (4) it paid kickbacks to U.S. officials who used its machines. In December 2021, Judge Eric Davis denied Fox’s motion to dismiss the case.

On March 22, 2023, attorneys for Fox and Dominion presented their cases in court, urging Judge Davis to grant their respective motions for summary judgment. Dominion filed in support of its motion Fox internal messages showing that network hosts, producers, and top executives knew that claims about Dominion were false but nevertheless aired them. In response, Fox argued that viewers would not have reasonably understood the statements about Dominion to be facts, and that the First Amendment protected the statements because they were newsworthy. The parties now await Judge Davis’s ruling on the motions for summary judgment.

In support of its motion for summary judgment, Dominion relied heavily on Grossberg’s deposition testimony. At the time of the November 2020 elections, Grossberg worked with Maria Bartiromo to book on-air guests who repeated allegations that Dominion manipulated election results. As part of her duties, Grossberg booked, produced, and wrote scripts for the guest segments, and oversaw the morning show’s control room team on logistics, graphics, promotions, and show elements.

Grossberg’s Suits Against Fox

Amidst the allegations that Fox News anchors reported false information about Dominion’s role in the 2020 presidential election, Grossberg alleges that the network’s litigation counsel at Winston & Strawn advised Grossberg to evade questions and provide untruthful responses during her deposition preparation session.

In Spring of 2022, Grossberg was informed that she would be deposed in connection with the Dominion lawsuit. On August 10, 2022, Grossberg attended the first day of a deposition preparation with several Fox in-house attorneys and two attorneys from Winston & Strawn. In her 79-page complaint, Grossberg alleges that “Fox’s legal team coerced, intimidated, and misinformed Ms. Grossberg as they ‘prepared’ her in connection with deposition testimony she gave in the pending defamation case . . . resulting in irretrievable reputational and emotional harm.”

Grossberg’s complaint asserts that:

Before they began [deposition preparation], Ms. Grossberg asked whether she needed to hire her own counsel. Without hesitation – i.e., before anyone could explore the potential mine field of conflicts in this situation – [outside counsel from Winston & Strawn] responded to Ms. Grossberg with a definitive and discouraging ‘no,’ explaining that while some employees . . . may have retained a personal attorney, it only ‘complicates’ the process and ‘slows things down.’

Grossberg contends counsel for Fox did not advise her that by giving false or misleading and evasive answers, she not only opened herself up to civil and criminal liability for perjury, but was shifting responsibility for the alleged defamation onto her own shoulders.

Grossberg attempts in her complaint to link her treatment during the preparation session to complaints she raised with supervisors and HR in January 2023 that Fox and its male employees fostered a workplace culture rampant with sexism and misogyny. She alleges she notified Fox of “the gender-based harassment she had been enduring . . . and [telling them] she felt constantly gaslit and belittled” by her male colleagues. In her complaint, Grossberg recounted dozens of alleged instances of chauvinistic behavior and harassment by Fox executives, including referring to Bartiromo as “crazy,” a “crazy bitch,” ”menopausal,” and “hysterical.”

Grossberg alleges that, mere hours later, Alexander McCaskill (the managing editor and senior producer for Tucker Carlson’s primetime program) informed her she was meeting with HR to “discuss her work performance.” Grossberg claims that, at the HR meeting, she was “further berated and attacked” for her complaints. Despite once more informing the HR representative about “countless examples of sexism and antisemitism recounted to her,” “no meaningful investigation into Ms. Grossberg’s discrimination complaints . . . occurred.”

Grossberg also claims that she was subjected to sexist behavior with respect to her deposition. She claims that, despite later learning that many of her male colleagues had been provided copies of their deposition transcript to review and correct shortly after their depositions, Grossberg was inexplicably not provided the opportunity to read, much less correct and sign, the transcript of her deposition until nearly eight months after her deposition and after Dominion filed its motion for summary judgment relying on her deposition testimony.

Dominion’s motion mentioned Grossberg “at least 15 times and her deposition transcript was referred to at least 11 times.” For example, Dominion cited to Grossberg’s deposition transcript for the following proposition: “Fox knew the charges were false yet failed to provide viewers with any of the extensive evidence of disproving them. Abby Grossberg: ‘Q: If someone says something untrue on one of your shows, do you think it’s important to correct it? A: No.’” Dominion likewise cited to Grossberg’s confirmation that Fox News is “a news show.”

Grossberg's suit claims violations of the federal Equal Pay Act and New York's Pay Equity Law, and gender discrimination, religious discrimination and retaliation in violation of New York State Human Rights Law, among other claims.

Fox’s Suit Against Grossberg

On March 20, 2023 – the same day Grossberg sued Fox – Fox filed its own suit against Grossberg, alleging that she threatened to sue the network and disclose communications she had with Fox’s attorneys protected by the attorney-client privilege. Fox sought injunctive relief prohibiting Grossberg from disclosing Fox News’ privileged information in public filings.

In its 9-page complaint, Fox alleged that Fox attorneys “clearly informed [Grossberg] that their discussions during these meetings for the [Dominion lawsuit] were to be kept confidential because they were subject to Fox News’ attorney client privilege.” Fox also said that its attorneys “clearly informed [Grossberg] that they represented Fox News in connection with the [Dominion lawsuit], and not [Grossberg] in her individual capacity.”

The very next day, Fox inexplicably dropped its suit against Grossberg in a single line notice of discontinuance: “PLEASE TAKE NOTICE that, pursuant to CLPR 3217(a)(1), Plaintiff Fox News Network, LLC, hereby discontinues this proceeding, without prejudice, and without costs to any party.” It appears that Fox’s counsel did not even appear for the scheduled hearing on the motion seeking injunctive relief.

When Judge Denies Fox’s Efforts to Seal Grossberg’s Allegations, Fox Terminates Grossberg’s Employment

On March 22, 2023, Fox filed an emergency motion in federal court seeking to redact the privileged communications Grossberg disclosed in her complaint. Fox argued that the communications fell squarely within the attorney-client privilege and that the privilege’s “higher values” warranted redaction. The next day, District Judge Jesse Furman denied the motion, holding that “[t]he information they seek to seal is already in the public domain.” While acknowledging that Fox’s arguments were “not without force,” Judge Furman found that because Grossberg’s lawsuit “has been widely reported – and the Complaint itself is already publicly accessible in its entirety,” Fox’s bid to seal the communications is moot. “Put simply, the Court cannot put the genie back in the bottle and make what has become public private again.

On March 24, 2023, Fox terminated Grossberg’s employment. According to Fox, Grossberg was terminated for “acting contrary to express instructions of the Company,” including disclosing information regarding the Dominion/Fox lawsuit that the company believed to be privileged. On March 27, Grossberg filed an amended complaint challenging her termination. Grossberg alleged:

Based on the temporal proximity between Ms. Grossberg asserting her rights as a woman not to be subjected to chauvinistic, sexist, misogynistic, toxic, and a pervasively hostile work environment, as well as her right (and obligation) as a citizen to tell the truth under oath, it is clear that Fox News unlawfully terminated Ms. Grossberg – in part – because she intended to correct her deposition testimony to be truthful and complete . . . [and] – in part – because of the sex-based animus that Fox News harbors against her.

Scope of the Attorney-Client Privilege

Despite Fox’s decision to drop its suit against Grossberg and the denial of its emergency motion, Grossberg’s complaint raises significant questions regarding the scope of the attorney-client privilege.

In its suit for injunctive relief, Fox argued the deposition preparation session fell squarely within the ambit of the attorney-client privilege. In New York, the privilege shields from disclosure “any confidential communications between an attorney and his or her client made for the purpose of obtaining or facilitating legal advice in the course of a professional relationship.” Employers generally may assert the attorney-client privilege to protect confidential communications between its higher-level employees and company counsel relating to the corporation’s legal matters, regardless of whether the attorney is in-house or outside counsel.

In its efforts to protect privileged communications revealed in the Grossberg suits, Fox cited Radovic v. City of New York, 168 Misc. 2d 58 (N.Y. Dist. Ct. 1996), a New York court decision holding that meetings between employers’ employees and attorneys, “including those undertaken to prepare an employee for her deposition,” are privileged. In Radovic, the court held that the plaintiff could not ask employee witnesses involved in preparation sessions to disclose any of the substance of communications during them.

Fox asserted that statements made during the meetings between Fox’s lawyers and Grossberg fell squarely within parameters of the Radovic decision because the statements were “confidential communications between an attorney and [Fox News] made for the purpose of obtaining or facilitating legal advice in the course of a professional relationship.” As noted above, the court did not substantively resolve this issue because the proverbial “Genie was already out of the bottle.”

Yet some courts have recognized that the principles underlying the attorney-client privilege (i.e., encouraging the client’s honesty by ensuring privacy) are not served where the employee meeting with company counsel has interests that are potentially adverse to the company. In these cases, the relevant question is whether the corporate client or the employee held the privilege. If the employee “owns” the privilege, the employee may disclose the privileged information through voluntarily waiver. New York Times Co. v. Lehrer McGovern Bovis, Inc., 300 A.D.2d 169 (1st Dep’t 2002).

In determining whether the corporation or the employee holds the privilege, federal circuit courts consider, among other factors, whether the employee “can demonstrate that corporate counsel, knowing that a possible conflict could arise, nonetheless saw fit to communicate with the employee in the employee’s individual capacity.” In re Bevill, Bressler & Schulman Asset Management Corp., 805 F.2d 120 (3d Cir. 1986).

Now that Fox has terminated Grossman, a key issue in her employment discrimination and retaliation action will be whether she violated company policy by disclosing through her pleadings confidential and/or privileged information of Fox conveyed during her deposition preparation session. The resolution of that issue may turn on a number factors:

• As a consequence of her position and responsibilities, did Grossman have the authority to bind Fox through her statements (such that the privilege attaches in the first instance?
• Even so, did Fox’s attorneys clearly advise her that they represent the company (only) and not her individually?
• Was there a conflict of interest that triggered Fox’s counsel obligation to advise her to retain her own counsel and treat her as a witness outside of the scope of the attorney-client privilege?
• And, can Grossberg, as claimed in her suits, establish that communications during the preparation session fall within the crime-fraud exception to the attorney-client privilege because Fox’s counsel advised her to engage in perjury.

Needless to say, the privilege issues raised by the Grossberg litigation offers allegations worthy of a law school exam (and a more lengthy article by your author, which will be posted soon)!