(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the
convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the
interests of brevity, portions of any opinion may not have been summarized).
Argued January 7, 1997 -- Decided March 26, 1997
HANDLER, J., writing for a unanimous Court.
In this case, an employee is suing her employer and two of her supervisors for sexual harassment under the Law
Against Discrimination (LAD). The general question addressed by the Court is the nature and extent of the pretrial
discovery that an employee claiming to have been sexually harassed is entitled to obtain for the purpose of establishing
the employer's liability based on its alleged failure to respond to her complaints of sexual harassment.
Joanne Payton began working as a maintenance records clerk for the New Jersey Turnpike Authority (the
Authority) in 1990. She alleged that, shortly after she started, two of her supervisors began to sexually harass her in
various ways. Although Payton tolerated the harassment for several years, she finally filed an internal complaint with the
Authority in September l994. During the following seven months, the alleged harassment continued, with the Authority
taking no remedial action against the supervisors. Finally, on March l0, l995, Payton filed suit in the Superior Court,
Law Division against the supervisors and the Authority, alleging that the Authority was vicariously liable for the acts of
the supervisors under the LAD.
On April 26, l995, the Authority announced that it had disciplined the two supervisors by suspending them
without pay, by demoting them, and by reducing their salaries. The Authority raised these actions as an affirmative
defense to Payton's complaint, claiming that, by its response to her complaint of sexual harassment, it had neither
participated in nor acquiesced in the harassment. The Authority later represented that its Equal Employment
Opportunity Officer (EEO Officer) had made initial findings about the complaint several months before Payton filed her
internal complaint and, further, that it had issued a final investigative report only four days after she filed suit. Finally,
the Authority asserted that, approximately one month after Payton filed suit, its Sexual Harassment Advisory Committee
had completed a confidential review of the EEO Officer's report and that, on April 25, l995, its commissioners had
convened an executive session regarding the matter, during which they presumably discussed the report and determined
the appropriate sanctions.
In order to gauge the validity of the Authority's affirmative defense that it had effectively remedied the
harassment, Payton sought discovery of materials relating to the investigation and executive session, including transcripts,
minutes, agendas, and other supporting documents. The Authority moved for a protective order exempting all of the
requested documents from discovery and asking the court to seal the record. The Law Division granted the protective
order in its entirety, without examining any of the documents in camera. In support of its broad order, the court cited
the public policy of confidentiality embodied in the LAD and relied, to a lesser degree, on the attorney-client privilege
and the privilege of self-critical analysis.
The Appellate Division granted Payton's motion for leave to appeal and vacated the protective order. The
Appellate Division concluded that Payton was at least entitled to discover information relating to the extent and timing of
the Authority's investigation, the information gleaned from that investigation, the Authority's evaluation of the
information, and the action taken by the Authority. The Appellate Division instructed the trial court to inspect the
documents at issue in camera and to make appropriate redactions in order to accommodate concerns about
confidentiality and privilege.
The Supreme Court granted the Authority's motion for leave to appeal.
HELD: Materials relating to an employer's internal investigation of alleged sexual harassment are relevant to a claim
under the LAD and hence generally discoverable.
1. New Jersey's discovery rules are to be construed liberally in favor of broad pretrial discovery and parties may obtain
discovery regarding any matter, not privileged, that is relevant to the pending subject matter. (pp. 6-7)
2. Under the LAD, employers that are negligent in failing to take effective steps to end sexual harassment can be liable
for compensatory damages, while those that actually participate in or are wilfully indifferent to the wrongful conduct can
be liable for punitive damages. (pp. 7-9)
3. The efficacy of an employer's remedial program is highly relevant to both an employee's claim against the employer
and the employer's defense to liability. (pp. 9-11)
4. A remedial scheme that reaches the correct result through a process that is unduly prolonged or that unnecessarily
and unreasonably leaves the employee exposed to continued hostility in the workplace is an ineffective remedial scheme.
(pp. 11-12)
5. Although relevance creates a presumption of discoverability, that presumption can be overcome by demonstrating the
applicability of an evidentiary privilege, such as that the need for confidentiality outweighs the need for disclosure. That
notwithstanding, such a categorical approach to concerns about confidentiality is disfavored, in favor of a case-by-case
balancing. (pp. 12-15)
6. The appropriate balance is to recognize a conditional privilege of confidentiality that applies selectively depending on
the nature of the material involved. In its application, a trial court may require procedures that protect the confidentiality
of those involved in the investigation if a loss of confidentiality would otherwise undermine the efficacy of investigations.
Only in truly extreme cases should the need for confidentiality require suppression of specific documents. (pp. 15-18)
7. Self-critical analysis is not qualitatively different from other confidential information and thus does not require the
protection of a broad privilege, as opposed to a balancing of interests. (pp. 19-22)
8. Confidentiality is not always essential to encourage frank, productive self-evaluation. If a trial court determines that
disclosure is warranted, which will normally be the case in discrimination lawsuits, it should take adequate protective
measures to ensure maximal confidentiality given the necessity of disclosure. (pp. 22-27)
9. The application of the attorney-client privilege must be determined on a case-by-case basis and depends on the role an
attorney may have had in the creation of the particular documents. (pp. 27-31)
10. A party may not abuse a privilege by asserting a claim or defense and then refusing to provide the information
underlying that claim or defense based on the privilege. (pp. 31-33)
11. In order for the work-product doctrine to apply, the trial court should make an in camera inspection of the documents
to determine that the materials have been prepared in anticipation of litigation, and not in the ordinary course of
business. (pp. 33-35)
12. If a public body legitimately conducts a meeting in closed session, it nevertheless must make the minutes of that
meeting promptly available to the public unless full disclosure would subvert the purpose of a particular exception to the
Open Public Meetings Act. However, given the Legislature's strongly stated intent to effectuate broad public
participation in the affairs of governmental bodies, few cases will require even partial nondisclosure. The Open Public
Meeting Act provides no greater protection than the attorney-client privilege and the work-product doctrine in general.
(pp. 35-40)
13. Although deference is normally given to a trial court's disposition of discovery matters, deference is inappropriate if
the court's determination in drafting its order is based on a mistaken understanding of the applicable law. (p. 40)
Judgment of the Appellate Division is AFFIRMED and the matter is REMANDED to the Law Division for
proceedings not inconsistent with this opinion.
JUSTICES O'HERN, GARIBALDI, STEIN and COLEMAN join in JUSTICE HANDLER'S opinion. CHIEF
JUSTICE PORITZ and JUSTICE POLLOCK did not participate.
SUPREME COURT OF NEW JERSEY
A-
91 September Term 1996
JOANNE PAYTON,
Plaintiff-Respondent,
v.
NEW JERSEY TURNPIKE AUTHORITY,
Defendant-Appellant,
and
MICHAEL STANKOWITZ and ROBERT C.
GEBERTH, Individually and as
employees of the New Jersey
Turnpike Authority,
Defendants.
Argued January 7, 1997 -- Decided March 26, 1997
On appeal from the Superior Court, Appellate
Division, whose opinion is reported at 292
N.J. Super. 36 (1996).
Michael K. Furey argued the cause for
appellant (Riker, Danzig, Scherer, Hyland &
Perretti, attorneys; Mr. Furey and James P.
Anelli, on the briefs).
Patricia M. Talbert argued the cause for
respondent (Carella, Byrne, Bain, Gilfillan,
Cecchi, Stewart & Olstein, attorneys).
Nancy Erika Smith submitted a brief on behalf
of amici curiae National Employment Lawyers
Association, New Jersey Employment Lawyers
Association and National Organization for
Women of New Jersey (Smith Mullin, attorneys;
Ms. Smith, Christopher P. Lenzo and Fredric
J. Gross, on the brief).
Richard C. Mariani submitted a brief on behalf of amicus curiae The New Jersey Chambers of Commerce (Apruzzese, McDermott,
Mastro & Murphy, attorneys; Mr. Mariani and
Kimberly E. Robertson, on the brief).
The opinion of the Court was delivered by
HANDLER, J.
In this case, an employee is suing her employer and two of
her supervisors for sexual harassment under the Law Against
Discrimination. She contends that her supervisors harassed her
and that her employer failed to respond adequately to her
complaints. Although the employer subsequently disciplined the
supervisors after determining that the employee's claims were
meritorious, the employee asserts that the employer's allegedly
inadequate response to her complaints contributed to the harm
that she suffered and consequently entitles her to damages.
The general question that we must consider is the nature and
extent of the pretrial discovery that an employee claiming to
have been sexually harassed is entitled to obtain for the purpose
of establishing the employer's liability based on its alleged
failure to respond to her complaints of sexual harassment. The
more specific issues that must be addressed in this case relate
to whether various documents and records pertaining to the
employer's handling and disposition of the employee's complaints
of sexual harassment, including its internal investigation, may
be made available through discovery and the extent to which
concerns based on confidentiality and privilege may preclude or
limit the discovery of such materials.
Plaintiff Joanne Payton began working as a maintenance records clerk for defendant New Jersey Turnpike Authority in November 1990. Shortly after she started, two of her supervisors, Robert Geberth and Michael Stankowitz (the two highest ranking administrators in her unit), allegedly began to sexually harass her. According to plaintiff's complaint, they harassed her in the following manners:
(a) Defendant Geberth commented about Plaintiff's clothing[,] grabbing the bottom of her skirt and pulling it down, stated her clothes look like she is "wearing pajamas," put his hand around the Plaintiff, on her shoulder or on her knee and called Plaintiff into his office directing that she turn around so that he could look at her;
(b) Defendant Stankowitz told Plaintiff on
several occasions that he was "horny" and
wanted "to get laid," referred to Plaintiff's
breasts and said to her "just one time,"
tried to look down Plaintiff's blouse and,
during lunch at a restaurant, took the
Plaintiff's hand and put it between his legs;
(c) During the office holiday luncheon on or
about December 1993, Defendants Geberth and
Stankowitz gave Plaintiff a "baby doll"
nightgown. Defendant Geberth insisted that
she open the gift in front of her office co-workers who were attending the luncheon; and
(d) On or about July, 1993, Defendant Geberth
slapped a female co-worker on the buttocks in
the presence of several co-workers, including
the Plaintiff.
For several years, plaintiff tolerated the harassment, but in
September 1994, she filed an internal complaint with defendant.
During the approximately seven months following plaintiff's
complaint, the alleged harassment continued, and defendant took
no remedial action against the supervisors. On March 10, 1995,
believing that defendant would not resolve the situation,
plaintiff brought suit in the Superior Court, Law Division
against defendant and the supervisors, alleging with regard to
defendant that it was vicariously liable under the Law Against
Discrimination ("LAD"), N.J.S.A. 10:5-1 to -42, for the
supervisors' conduct.
On April 26, 1995, defendant announced that it had
disciplined the two supervisors, having suspended them without
pay, demoted them, and reduced their salaries. Five days later,
in answer to plaintiff's complaint, defendant raised these
actions as an affirmative defense to vicarious liability,
claiming that, by its response to her complaint of sexual
harassment, it had neither participated in nor acquiesced in the
harassment. Defendant later represented, through a privileged
document log, that its Equal Employment Opportunity Officer ("EEO
Officer") had made initial findings about the complaint on
December 8, 1994 and (together with in-house counsel) had issued
a final investigative report on March 14, 1995, four days after
plaintiff had filed suit. It also asserted that, on April 13,
1995, its Sexual Harassment Advisory Committee had completed a
confidential review of the EEO Officer's report, including
remedial recommendations, and that, on April 25, 1995,
defendant's commissioners had convened an executive session
regarding the matter, during which they presumably had discussed
the report and determined the appropriate sanctions.
In order to gauge the timeliness and thoroughness of
defendant's actions (and hence the validity of defendant's
affirmative defense that it had effectively remedied the
harassment), plaintiff sought discovery of materials relating to
the investigation and executive session. Specifically, she
demanded "[a]ll documents relating to any investigation that was
conducted by or for the defendant having to do with the plaintiff
and her employment with the defendant[,] . . . [a]ll documents
relating to any investigation that was conducted by or for the
defendant having to do with the plaintiff and her administrative
complaint alleging sexual harassment[, and] . . . [a]ny minutes,
transcriptions, reports, supporting documents, agendas, [and]
recordings related to [the Commissioners' April 25, 1995]
meeting."
Defendant moved for a protective order exempting all of the
requested documents from discovery. It also asked the court to
seal the record. Plaintiff opposed the motion and, in the
alternative, moved to strike the affirmative defense if defendant
were not required to produce the documents.
The Law Division, without examining any of the documents in
camera, granted the protective order in its entirety, thus
removing from the discovery process all documents relating to the
investigation. In support of its broad order, the court cited
the public policy of confidentiality embodied in the LAD. It
also relied, to a lesser degree, on the attorney-client privilege
and the so-called privilege of self-critical analysis.
Plaintiff then sought interlocutory relief in the Appellate
Division, which granted leave to appeal and vacated the
protective order.
292 N.J. Super. 36 (1996). Relying on our
holding in Lehmann v. Toys `R' Us, Inc.,
132 N.J. 587 (1993), the
court concluded that plaintiff was at least entitled to discover
information relating to "the extent of the Authority's
investigation, the timing of the Authority's investigation
relative to the date of plaintiff's complaint to the department,
the information gleaned by the Authority from its investigation,
the Authority's evaluation of the information, and the action
taken by the Authority." 292 N.J. Super. at 46. The Appellate
Division instructed the trial court to inspect the documents at
issue in camera and to make appropriate redactions in order to
accommodate concerns about confidentiality and privilege. Id. at
53-54.
We granted defendant's motion for leave to appeal,
146 N.J. 495 (1996), and we now affirm.
New Jersey's discovery rules are to be construed liberally in favor of broad pretrial discovery. Jenkins v. Rainner, 69 N.J. 50, 56 (1976) ("Our court system has long been committed to the view that essential justice is better achieved when there has been full disclosure so that the parties are conversant with all the available facts."); Catalpa Investment Group, Inc. v. Zoning Bd. of Adjustment, 254 N.J. Super. 270, 273 (Law Div. 1991);
Martin v. Educ. Testing Serv., Inc.,
179 N.J. Super. 317, 327
(Ch. Div. 1981). Under the rules, "[p]arties may obtain
discovery regarding any matter, not privileged, which is relevant
to the subject matter involved in the pending action . . . ." R.
4:10-2(a). "Relevant evidence," although not defined in the
discovery rules, is defined elsewhere as "evidence having a
tendency in reason to prove or disprove any fact of consequence
to the determination of the action." N.J.R.E. 401.
In determining whether materials relating to defendant's
internal investigation are discoverable, therefore, we must
evaluate, as an initial matter, their relevance to the issues
raised in this litigation. We look to Lehmann, supra,
132 N.J. 587, for guidance in this regard. In Lehmann, the plaintiff
brought suit under the LAD, alleging hostile work environment
arising from sexual harassment at the hands of her supervisor.
Id. at 595-99. She did not simply sue the actual harassers,
however, instead naming her employer and alleging that it was
vicariously liable; among her allegations was the employer's
supposedly deficient investigation of her internal complaints.
Id. at 599.
We held in Lehmann that the LAD's prohibition of sex
discrimination created causes of action for sexual harassment and
hostile work environment resulting from that harassment. Id. at
600-15. We then reached the difficult issue of employer
liability under those circumstances and concluded that employers
could be vicariously liable in damages under an agency theory for
sexual harassment committed by employees, id. at 619-20, and that
such liability would be governed by a variable standard depending
on the state of mind of the employer. Id. at 619-26. Employers
that were negligent in failing to take effective steps to end
sexual harassment would be liable for compensatory damages, id.
at 621-23, while those that actually participated in or were
willfully indifferent to the wrongful conduct would be liable for
punitive damages. Id. at 624-25.
Of particular importance in Lehmann, we noted that an
employer's liability for its own negligence in failing to take
effective remedial measures was a form of direct liability in
addition to vicarious liability. Id. at 623. We stated that
[w]hen an employer knows or should know of
the harassment and fails to take effective
measures to stop it, the employer has joined
with the harasser in making the working
environment hostile. The employer, by
failing to take action, sends the harassed
employee the message that the harassment is
acceptable and that the management supports
the harasser. . . . "Effective" remedial
measures are those reasonably calculated to
end the harassment. The reasonableness of an
employer's remedy will depend on its ability
to stop harassment by the person who engaged
in harassment.
Thus, we determined that an employer that failed to take effective remedial measures against a harassing employee was, in essence, liable for its own conduct.
While the effectiveness of an employer's remedial steps relates to an employee's claim of liability, it is also relevant to an employer's affirmative defense that its actions absolve it
from all liability. See infra at __-__ (slip op. at 13-14).
Thus, the efficacy of an employer's remedial program is highly
relevant to both an employee's claim against the employer and the
employer's defense to liability.
Given the dual significance of the effectiveness of an
employer's remedial actions, the critical interpretive question
that confronts us in this case is the understanding of
"effective" as the standard by which to evaluate the adequacy of
an employer's response to a complaint of sexual harassment. If,
as defendant argues, the effectiveness of a remedial scheme is
measured solely by its final outcome, namely, the ultimate
sanction imposed, then documents relating to the internal
investigatory process leading up to the sanction are irrelevant
to the harassment and hostile-work-environment claims against the
employer and hence not discoverable. However, if effectiveness
is gauged by the process of the investigation -- including
timeliness, thoroughness, attitude toward the allegedly harassed
employee, and the like -- as well as by the result of the
investigation, then the documents are clearly relevant and
discoverable.
We are persuaded that the "effective" remedial measures
emphasized in Lehmann include the process by which the employer
arrives at the sanctions that it imposes on the alleged harasser.
If effective measures are those "reasonably calculated to end the
harassment," Lehmann, supra, 132 N.J. at 623, then neither a
court nor a jury can evaluate effectiveness without considering
the entire remedial process. As the Appellate Division noted:
[The] timeliness of an employer's response is
an important element in determining the
effectiveness of an anti-harassment program.
. . . A slow response may be perceived as a
reluctant response and call into question the
bona fides of an employer's anti-harassment
program. Similarly, an investigation, though
timely instituted, may be pursued half-heartedly and unduly prolonged. On the other
hand, a timely, vigorously pursued inquiry
that corroborates the victim's accusations
will compromise a well-designed anti-harassment program, if the employer drags its
feet in acting on the corroborative evidence.
[292 N.J. Super. at 47 (citation
omitted).]
Numerous federal courts have adopted this position as well.
See, e.g., Guess v. Bethlehem Steel Corp.,
913 F.2d 463, 465 (7th
Cir. 1990); Harding v. Dana Transport,
914 F. Supp. 1084, 1094
(D.N.J. 1996); Van Horn v. Elbeco, Inc., No. CIV. A. 94-2720,
1
996 WL 385630, at *9 (E.D. Pa. July 10, 1996); Stewart v. Weis
Markets, Inc.,
890 F. Supp. 382, 390 (M.D. Pa. 1995); Giordano v.
William Paterson College,
804 F. Supp. 637, 643-44 (D.N.J. 1992);
Foster v. Township of Hillside,
780 F. Supp. 1026, 1039 (D.N.J.),
aff'd,
977 F.2d 567 (3d Cir. 1992); Zabkowicz v. West Bend Co.,
589 F. Supp. 780 (E.D. Wis. 1984). Federal jurisprudence in this
area is particularly relevant because the LAD draws significantly
from federal antidiscrimination law. See Lehmann, supra, 132
N.J. at 617-19, 622-23.
In this case, full discovery may enable plaintiff to support
and to advance her argument that defendant's delay in
investigating her complaint and its delay in preparing a report
until four days after she had filed this lawsuit reflected an
unwillingness promptly to investigate and to remediate her
allegations of sexual harassment. The claim is based on an
employer's obligation to create an effective investigatory and
remedial process that does not discourage employees from
exercising their statutory rights. See Lehmann, supra, 132 N.J.
at 623; cf. Romano v. Brown & Williamson Tobacco Corp.,
284 N.J.
Super. 543 (App. Div. 1995) (in context of claim of retaliation
against employee, inquiring into employer's internal reaction to
employee's complaint of employer's illegal conduct).
In short, a remedial scheme that reaches the correct result
through a process that is unduly prolonged or that unnecessarily
and unreasonably leaves the employee exposed to continued
hostility in the workplace is an ineffective remedial scheme.
Such a process, in reality, indirectly punishes employees with
the temerity to complain about sexual harassment and cannot
constitute "effective" remediation. Indeed, such a scheme can be
viewed only as an attempt by the employer to discourage employees
from coming forward and utilizing the employer's remedial process
in the first place. Because of the importance of the remedial
process in evaluating an employer's good faith in counteracting
and attacking sexual harassment and in eliminating hostile work
environment, we conclude that materials relating to an employer's
internal investigation of alleged sexual harassment are relevant
to a claim under the LAD and hence generally discoverable.
Although relevance creates a presumption of discoverability, that presumption can be overcome by demonstrating the applicability of an evidentiary privilege. R. 4:10-2(a). A privilege reflects a societal judgment that the need for confidentiality outweighs the need for disclosure. Hague v. Williams, 37 N.J. 328, 335 (1962); Wylie v. Mills, 195 N.J. Super. 332, 337 (Law Div. 1984). Despite the existence of privileges, however, our desire to attain truth through the adversarial process has led to a disfavoring of such a categorical approach to concerns about confidentiality, see United States v. Nixon, 418 U.S. 683, 710, 94 S. Ct. 3090, 3108, 41 L. Ed.2d 1039, 1065 (1974); Dixon v. Rutgers Univ., 110 N.J. 432, 446-47 (1988); State v. Briley, 53 N.J. 498, 505-06 (1969); Hague, supra, 37 N.J. at 335; State v. Szemple, 263 N.J. Super. 98, 101-02 (App. Div. 1993), aff'd, 135 N.J. 406 (1994), in favor of case-by-case balancing. See Loigman v. Kimmelman, 102 N.J. 98, 103-04 (1986).
The disfavored status of privileges is the backdrop against which we analyze each of the grounds that defendant asserts to justify exclusion of its relevant investigatory materials from the discovery process. We note that our analysis of the various claims of privilege contains two common themes, namely, the strong public interest, embodied in the LAD, of eliminating discrimination and harassment and the balancing of that interest against various interests in confidentiality.
Defendant contends that our decision in Lehmann, several decisions of the United States Supreme Court, and former-Governor Florio's issuance of Executive Order No. 88 combine to create a "public policy of confidentiality." The trial court relied heavily on this rationale in granting the protective order:
The Court would have to put on blinders to fail to recognize the fact that those who come forward in terms of this type of investigation do so with an understanding that any communication would be privileged. . . . I am satisfied that the paramount interest in terms of the law against discrimination relates to the public policy in promoting the purpose of the act [i.e., confidentiality and eliminating underreporting]. And to undermine that with an opening of the investigative process involved . . . would be inappropriate and contrary to the purpose of the intent. . . . I am satisfied . . . that information that is given under such cover should be maintained under such cover unless there are compelling reasons to dictate otherwise.
Although defendant does not use the word "privilege" in this context, it effectively urges the creation of a privilege that precludes discovery of "confidential" materials relating to internal sexual-harassment investigations.
Both this Court, in Lehmann, supra, 132 N.J. at 622, and the United States Supreme Court, in Meritor Savings Bank v. Vinson, 477 U.S. 57, 72-73, 106 S. Ct. 2399, 2408, 91 L. Ed.2d 49, 63 (1986), have allowed employers to avoid liability for sexual harassment by implementing effective procedures to combat this evil internally, thus encouraging victims to come forward and to report prohibited conduct. Moreover, then-Governor Florio, by
executive order, mandated a review of anti-sexual-harassment
procedures throughout the state government in order to make them
"more effective and sensitive to the needs of victims of sexual
harassment." Exec. Order No. 88,
25 N.J.R. 1799(b) (1993). The
Department of Personnel, in response to the executive order,
recommended that investigators of sexual harassment be cognizant
of confidentiality in order to encourage victims to report
allegations and to elicit candid statements from all involved.
Review Committee on Sexual Harassment, New Jersey Department of
Personnel, People Working Together: A Report on Sexual
Harassment (1993). We recognized the importance of
confidentiality in this context in In re Seaman,
133 N.J. 67, 90-91 (1993).
We reaffirm our belief that confidentiality is an important
component of any policy designed to maximize reporting of alleged
sexual harassment and to ensure the accuracy of ensuing
investigations into such allegations. However, whether the
importance of confidentiality leads to the creation of a
privilege to refuse to produce documents relating to internal
investigations implicates other important counterbalancing
considerations. In Dixon, supra, 110 N.J. at 446-59, we were
confronted with a similar request to convert confidentiality
concerns into a qualified privilege, in that case, one that would
have precluded discovery of materials related to peer evaluation
for university tenure determinations. We declined to create a
privilege in that context, ibid., and the reasoning that we
employed there is apposite in the context of this case.
In refusing, in Dixon, to create a qualified privilege in
the peer-review situation, we distinguished the cases in which we
had created such privileges, emphasizing that in those cases, the
Court had been required to "balance private interests in
disclosure against public interests in confidentiality," whereas
in the case before it the Court had to "balance the public
interest in maintaining a confidential peer review process that
protects the university's academic freedom against our State's
strong public policy favoring disclosure and eradication of
discriminatory treatment in employment." Id. at 451. We then
determined that the powerful legislative policy embodied in the
LAD of eliminating discrimination overrode the interest in
maintaining an iron curtain around the peer-review process. Id.
at 451-54.
As in Dixon, and unlike the cases in which we have
recognized new privileges, we are confronted with two competing
public interests, as opposed to a private interest in disclosure
that is outweighed by a strong public interest in
confidentiality. Unlike Dixon, however, the two asserted
interests in this case -- disclosure to ensure that employers
maintain effective sexual-harassment procedures and nondisclosure
to enable employers to maintain effective procedures that
encourage reporting and candid statements by all involved -- both
claim to strive for the same goal, namely, an end to sexual
harassment.
Because those advocating disclosure and those advocating
nondisclosure pledge allegiance to the same goal -- eradication
of sexual harassment -- while arguing for different methods of
achieving that goal, we cannot simply fall back on the maxim that
"[t]he eradication of the cancer of discrimination has long been
one of our State's highest priorities," id. at 451 (internal
quotations omitted) (quoting Fuchilla v. Layman,
109 N.J. 319,
334, cert. denied,
488 U.S. 826,
109 S. Ct. 75,
102 L. Ed.2d 51
(1988)), to resolve the conflict. Instead, we must determine
which method of achieving the unanimously supported goal will
best achieve that goal.
We conclude that the appropriate balance is not to create a
blanket privilege arising from legitimate general concerns for
confidentiality, but rather to recognize a conditional privilege
that applies selectively depending on the nature of the materials
involved. In its application, the trial court may supervise
discovery of the relevant internal investigatory materials and
require procedures that protect the confidentiality of those
involved in the investigation if a loss of confidentiality would
otherwise undermine the efficacy of investigations. Such
procedures, short of suppression, may include redaction, issuance
of confidentiality or gag orders, and sealing of portions of the
record. Only in truly extreme cases should the need for
confidentiality require suppression of specific documents.
We believe that those procedures are preferable to a
privilege because confidentiality concerns in this context are
less acute as a result of the limited number of participants who
will benefit from a secretive process. Obviously, a plaintiff
waives her confidentiality interest by bringing suit. Moreover,
the employer and any other defendants, namely, the actual
harassers, already have been named in the suit, and other
material witnesses already may be well-known. Consequently, the
only persons who benefit from confidentiality in this type of
case are witnesses who may not be known or whose cooperation
otherwise may not be forthcoming, and their identities can be
protected through redaction. Furthermore, there may be
situations in which such witnesses no longer have a continuing
need for confidentiality or may be deemed to have relinquished or
waived their interest in confidentiality.
The Appellate Division addressed the concern about witness
confidentiality, and we agree with its observation that "it may
not be possible to protect [witnesses'] identities throughout the
entire course of the litigation consistent with plaintiff's right
to the opportunity to establish a cause of action . . . ." 292
N.J. Super. at 48. Unfortunately, even the best efforts to
maintain confidentiality may fail during the lifespan of a
lawsuit. Yet, we must rely on the creativity of the trial court
and the good faith of the parties to guard against unnecessary
revelation and thus to protect the integrity of the investigatory
process.See footnote 1
We therefore conclude that, regarding confidentiality, the
balance weighs in favor of disclosure with appropriate procedures
to ensure justified confidentiality in light of plaintiff's
paramount interest in obtaining relevant materials.
Defendant also relies on the so-called privilege of self-critical analysis in justifying the protective order. The trial court relied in part on that privilege in granting the order, while the Appellate Division rejected its applicability because of the importance of the materials to plaintiff's case. 292 N.J. Super. at 48-49. Both courts, as have a number of lower courts, assumed the existence of this broad privilege in New Jersey
despite the fact that this Court never actually has adopted it,
only having referred to it without expressing an opinion as to
its validity. Loigman, supra, 102 N.J. at 107; McClain v.
College Hosp.,
99 N.J. 346, 359 (1985).
The privilege of self-critical analysis exempts from
disclosure deliberative and evaluative components of an
organization's confidential materials. Tharp v. Sivyer Steel
Corp.,
149 F.R.D. 177, 179-80 (S.D. Iowa 1993). According to one
court, "[t]he primary justification for this privilege is the
encouragement of candor and frankness toward the ends of
discovering the reasons for past problems and preventing future
problems." Korostynski, supra, 266 N.J. Super. at 557. Although
some courts have rejected the privilege, e.g., Etienne v. Mitre
Corp.,
146 F.R.D. 145, 148-49 (E.D. Va. 1993); Siskonen v.
Stanadyne, Inc.,
124 F.R.D. 610, 611-12 (W.D. Mich. 1989); Hardy
v. New York News, Inc.,
114 F.R.D. 633, 641-43 (S.D.N.Y. 1987),
others have adopted it. E.g., In re Crazy Eddie Sec. Litig.,
792 F. Supp. 197, 205-06 (E.D.N.Y. 1992); Roberts v. Carrier Corp.,
107 F.R.D. 678, 684-85 (N.D. Ind. 1985); Bredice v. Doctors
Hosp., Inc.,
50 F.R.D. 249, 251 (D.D.C. 1970), aff'd,
479 F.2d 920 (D.C. Cir. 1973).
Several lower courts in this State have adopted the
privilege and granted seemingly absolute protection to evaluative
and deliberative portions of organizations' files. Korostynski,
supra, 266 N.J. Super. at 557; Bundy v. Sinopoli,
243 N.J. Super. 563 (Law Div. 1990); Wylie, supra,
195 N.J. Super. 332. Others
have accommodated the confidentiality concerns arising from
potential disclosure of deliberative and evaluative processes by
employing a balancing test instead of a more rigid privilege.
Red Bank Register, Inc. v. Board of Educ.,
206 N.J. Super. 1, 10-11 (App. Div. 1985); Hussain v. Gardner,
264 N.J. Super. 208,
210-12 (Law Div. 1993); Asbury Park Press, Inc. v. Borough of
Seaside Heights,
246 N.J. Super. 62, 67-72 (Law Div. 1990).
We decline to adopt the privilege of self-critical analysis
as a full privilege, either qualified or absolute, and disavow
the statements in those lower court decisions that have accorded
materials covered by the supposed privilege near-absolute
protection from disclosure. Instead, we perceive concerns
arising from the disclosure of evaluative and deliberative
materials to be amply accommodated by the "exquisite weighing
process," Loigman, supra, 102 N.J. at 108 (quoting Beck v.
Bluestein,
194 N.J. Super. 247, 263 (App. Div. 1984)), that our
courts regularly undertake when determining whether to order
disclosure of sensitive documents in a variety of contexts. See
Hammock v. Hoffman-LaRoche, Inc.,
142 N.J. 356, 381 (1995) ("[A]
flexible balancing process adaptable to different circumstances
must be conducted to determine whether the need for secrecy
substantially outweighs the presumption of access."). In fact,
we view concerns about revelation of self-criticism to be a
subset of the more generalized confidentiality concerns that we
already have addressed and that we have refused to protect with
an absolute or qualified privilege. Supra at __-__ (slip op. at
13-18). Our determination in this respect is especially
appropriate given our holding in Dixon that we particularly
disfavor privileges in the employment-discrimination context.
Dixon, supra, 110 N.J. at 451-54.
Self-critical analysis, although deserving of substantial
consideration when a court balances a party's need to know
against another party's need for confidentiality, is not
qualitatively different from other confidential information, and
thus does not require the protection of a broad privilege as
opposed to a balancing of interests. Although both the courts
and the Legislature have classified certain confidential
communications as qualitatively different and thus deserving of
an evidentiary privilege, e.g., N.J.R.E. 505 (psychologist
privilege); N.J.R.E. 506 (physician-patient privilege); N.J.R.E.
508 (newsperson's privilege); N.J.R.E. 511 (cleric-penitent
privilege); State v. Toscano,
13 N.J. 418, 424-25 (1953)
(attorney-client privilege), such privileges are rooted in our
jurisprudential traditions and reflect a firm societal commitment
to preserving particular confidences even at the expense of
truth. Given the presumption against the creation of new
privileges and the potential breadth of privileging self-critical
analysis, we do not join those courts that have adopted the
privilege.
Of course, as we already have noted, confidentiality
concerns surrounding communications consisting of self-critical
analysis, under certain rare circumstances, may outweigh the need
for disclosure. Our rejection of the embodiment of such concerns
in an evidentiary privilege should not be interpreted as
denigrating the importance of candid deliberation and self-criticism. As the court stated in Wylie, supra:
Valuable criticism can neither be sought nor
obtained nor generated in the shadow of
potential or even possible public disclosure.
It is not realistic to expect candid
expressions of opinion or suggestions as to
future policy or procedures in an air of
apprehension that such statements may well be
used against one's colleague or employer in a
subsequent litigated matter. The purpose of
an investigation intended to seek criticism
. . . of then existing policy or procedure is
self-improvement. The value of the
investigation is questionable if the input is
not reliable. It is clear that the
reliability of the input in this situation
varies inversely with the risk of disclosure
of the input or resulting criticisms.
However, despite our recognition of the forcefulness of that argument, we are not as confident as the court in Wylie that absolute confidentiality is always essential to encourage frank, productive self-evaluation. It is not so clear that disclosure inevitably will discourage candid self-criticism. As the court noted in Tharp, supra, in the employment context:
Permitting disclosure of an employer's self-critical analyses of its equal employment efforts may actually cause [an employer] to engage in a more honest assessment of its efforts because flaws in those analyses may be brought to light in civil litigation. The sunshine of public scrutiny would thus act as a catalyst to promote, not inhibit, employers to engage in full and candid equal employment assessments. . . . [A] weakly worded, unimaginative, and unaggressive analysis . . . may be more damning than a candid
evaluation recognizing a company's weaknesses
and expressing a serious commitment to
overcome those weaknesses.
[149 F.R.D. at 183 n.13, 184 n.16
(citation omitted).]
See also Louis L. Chodoff, Conducting a Sexual Harassment
Investigation, N.J. Labor and Emp. L.Q., Winter 1997, at 4
(advising employers, in light of recent legal trend toward
requiring disclosure of internal sexual-harassment investigatory
materials, to conduct candid, thorough, and efficient
investigations in order to avoid liability).
Moreover, as observed by the Appellate Division, when a
deliberating body is required by law to prepare an honest report,
replete with self-evaluation, we do not assume that that body
will shirk its responsibilities in order to hide the truth. 262
N.J. Super. at 48-49 (noting legal duty of employer to respond
effectively to allegations of sexual harassment); CPC Int'l, Inc.
v. Hartford Accident & Indem. Co.,
262 N.J. Super. 191, 195-204
(Law Div. 1992) (rejecting application of privilege of self-critical analysis because of legal duty to prepare environmental
report, which reduced the risk of deterring candid self-criticism
through disclosure); Asbury Park Press, supra, 246 N.J. Super. at
69-70 (stressing legal duty of police officer to prepare
accurate, honest investigatory report regardless of potential
disclosure).
Given these competing views of human nature and
institutional and organizational conduct, as well as the
influence of legal rules on actors, we believe that case-by-case
balancing is much more appropriate in accommodating self-critical
analysis than is a per se privilege. That approach comports with
our preference for balancing, as opposed to categorical
exclusionary rules, when addressing confidentiality concerns that
arise during litigation. For example, we have noted, in the
context of the common-law right of access to public documents,
that our cases do not "sustain an absolute privilege of secrecy
for all such investigatory materials. . . . A court should
balance, in each case, the individual's right to the information
against the public interest in the confidentiality of the file."
Loigman, supra, 102 N.J. at 103-04; see also Home News v. State
Dep't of Health,
144 N.J. 446, 456 (1996) (disapproving of per se
nondisclosure rule for cause-of-death information on death
certificates and reasoning that "[t]hat type of blanket
prohibition is not consistent with the balancing approach
mandated by the common law"); McClain, supra, 99 N.J. at 359-61
(balancing interests in determining whether to order disclosure
of confidential investigative materials that reflected
deliberative processes).
Although trial courts should accord significant weight to
self-critical analysis and although confidentiality concerns
about such information at times may outweigh competing interests
in disclosure (especially if the information is obtainable
through other sources), certain interests in disclosure are
strong enough, in their reflection of important public policies,
to outweigh such confidentiality concerns under most, if not all,
circumstances. See Tharp, supra, 149 F.R.D. at 181-85 (holding
that privilege of self-critical analysis did not apply in
employment-discrimination cases, in part, because "disclosure of
employers' `self-critical analysis' materials may play a crucial
function in civil litigation to eradicate discrimination that
exists in the work place"); Korostynski, supra, 266 N.J. Super.
at 558-59 (recognizing that elimination of discrimination was a
weightier interest than most private interests); CPC Int'l,
supra, 262 N.J. Super. at 195-204 (ordering disclosure of
corporation's environmental reports because of strong public
interest in disclosure of private documents relating to
environmental protection).
We recognized one such public policy in Dixon, where we
stressed the paramount public interest in the eradication of
discrimination, an interest that outweighed the interest in
confidential communications in the tenure process. Dixon, supra,
110 N.J. at 451-54. We then stated that in determining whether
to disclose documents relating to a discrimination claim, the
trial court must "satisfy itself that the discrimination charge
is valid and the material requested is relevant. . . . By
requiring the plaintiff to demonstrate that the claim is valid
and the material relevant, we intend to place only a modest
burden on the plaintiff." Id. at 455.
Paralleling its argument about the asserted public policy of
confidentiality, defendant contends that its interest in
nondisclosure of its self-criticism is also reflective of the
public policy of eradicating discrimination, thus weighing
against disclosure. Although this particular interest in
nondisclosure is more substantial than many other interests, for
the reasons previously advanced, supra at __-__ (slip op. at 15-17), we believe that the balance, assuming a valid claim and
relevance, is normally best struck in favor of disclosure. As we
described in Dixon, supra, however, acknowledging the need to
order disclosure does not end the inquiry. Instead
[b]efore giving the plaintiff access to the
confidential materials . . . the trial court
should take various measures designed to
minimize intrusion into their
confidentiality. In this connection, we rely
on practical, common-sense applications of
rules of discovery that are familiar to trial
courts in order to resolve most of the
problems of confidentiality. . . . Although
the protective measures a trial court may
choose to employ will vary according to the
circumstances of each case, we recommend that
compelled disclosure of confidential . . .
materials be accompanied by a protective
order that limits access to persons directly
involved in the case.
Consequently, we reject the privilege of self-critical analysis in favor of a case-by-case balancing approach. Because of the powerful public interest in eradicating discrimination and sexual harassment, we believe that the balance generally will favor disclosure in this type of case, although there may be specific documents of such limited relevance or of such high sensitivity that the balance will favor nondisclosure. If a trial court determines that disclosure is warranted, which will normally be the case in discrimination lawsuits, it should take
adequate protective measures to ensure maximal confidentiality
given the necessity of disclosure.
Defendant maintains that the attorney-client privilege protects the entire investigatory process because attorneys employed by defendant participated in the investigation. We disagree with that blanket contention and instead agree with the Appellate Division that the record is currently insufficient to resolve this issue. Accordingly, we require the trial court on remand to "review the documents in camera in light of Lehmann, the principles applicable to the attorney-client privilege, and the need to shield the identities of witnesses who provided information to the Authority" and then to "make specific determinations regarding plaintiff's access to them, including an expression of reasons for the court's rulings." 292 N.J. Super. at 52-53. In so doing, the court will have to determine the exact role that an attorney played regarding each particular document for which the privilege is asserted. Despite our inability to dispose of this claim in its entirety, we provide some guidance to the trial court on the standards that it should apply in this inquiry.
While an organization or corporation like defendant can be a "client" for purposes of the privilege, N.J.R.E. 504(3); Upjohn Co. v. United States, 449 U.S. 383, 395, 101 S. Ct. 677, 685, 66 L. Ed.2d 584, 595 (1981); In re Grand Jury Subpoenas, 241 N.J.
Super. 18, 28-29 (App. Div. 1989); In re State Comm'n of
Investigation,
226 N.J. Super. 461 (App. Div.), certif. denied,
113 N.J. 382 (1988), a fine line exists between an attorney who
provides legal services or advice to an organization and one who
performs essentially nonlegal duties. An attorney who is not
performing legal services or providing legal advice in some form
does not qualify as a "lawyer" for purposes of the privilege.
Thus, when an attorney conducts an investigation not for the
purpose of preparing for litigation or providing legal advice,
but rather for some other purpose, the privilege is inapplicable.
United Jersey Bank v. Wolosoff,
196 N.J. Super. 553, 563 (App.
Div. 1984). That result obtains even where litigation may
eventually arise from the subject of the attorney's activities.
Ibid.
The key issue regarding the applicability of the privilege
in this case is the purpose of the various components of the
investigation that defendant initiated into plaintiff's
allegations of sexual harassment. If the purpose was to provide
legal advice or to prepare for litigation, then the privilege
applies. However, if the purpose was simply to enforce
defendant's antiharassment policy or to comply with its legal
duty to investigate and to remedy the allegations, then the
privilege does not apply.
Although, given the state of the record and the trial
court's failure to conduct an in camera review of the documents
at issue, we are unable to draw conclusions regarding specific
documents, we do not perceive the investigation that defendant
performed as being one that generally is covered by the
privilege. Defendant allegedly initiated the investigation
months before plaintiff brought suit against it. The timetable
thus suggests that defendant began to investigate in order to
comply with its internal policies and to fulfill its legal duty
under Lehmann. Although any internal sexual-harassment complaint
has the potential to balloon into a lawsuit, effective internal
remediation is independently necessary and may prevent such an
eventuality. Thus, it is unclear, and perhaps unlikely, that the
attorneys involved in the investigation were truly or primarily
acting in their legal capacities. We agree with the statement
that
[i]f all activities of a lawyer are to be
classified as warranting the bar of discovery
proceedings because of the attorney-client
privilege, then it would be appropriate for
clients to retain lawyers as investigators,
custodians of records and the like, thereby
turning the shield of the privilege into the
sword of injustice.
[Metasalts Corp. v. Weiss,
76 N.J.
Super. 291, 299 (Ch. Div. 1962).]
A substantial number of sexual-harassment lawsuits raise the issue of the employer's response to the employee's internal complaint. If the attorney-client privilege were to apply broadly to any internal investigation of this type undertaken by an attorney, regardless of the pendency of litigation or the provision of legal advice, then all employers would commission attorneys as investigators, thus defeating the paramount public
interest in eradicating discrimination as expressed in the LAD
and as interpreted in Lehmann and Dixon. The Appellate Division
expressed this point: "We deem it unlikely that . . . Lehmann,
having defined a cause of action against an employer based in
part on the employer's response to a harassment complaint, [may
be read] to permit an employer to immunize its response from
inquiry by assigning a lawyer to investigate the complaint." 292
N.J. Super. at 50.
Moreover, the privilege, although important, is not
sacrosanct. It "may be pierced upon a showing of need, relevance
and materiality, and the fact that the information could not be
secured from any less intrusive source." Id. at 52 (citing In re
Kozlov,
79 N.J. 232, 243-44 (1979)). That principle is
especially appropriate in this case, where the powerful public
interest in eliminating discrimination and sexual harassment is
present and where defendant's claim to the privilege is tenuous
at best.
In any event, despite our doubts about the applicability of
the privilege based solely on the status of those involved in the
investigation as attorneys, we stress that the trial court must
evaluate the individual documents at issue in camera to determine
what role an attorney may have had in the creation of those
particular documents. See Wolosoff, supra, 196 N.J. Super. at
563. The privilege very well may apply to portions of the
investigation, thus requiring redaction or suppression if
effective redaction is impossible.
If the trial court should determine that the privilege
applies to particular aspects of the investigation -- for
example, specific parts of the investigation after plaintiff
filed this lawsuit -- it then must determine whether defendant
has waived the privilege by raising the investigation as an
affirmative defense. A party may not abuse a privilege,
including the attorney-client privilege, by asserting a claim or
defense and then refusing to provide the information underlying
that claim or defense based on the privilege. Id. at 565-67
(canvassing cases holding that waiver had occurred when party
asserting privilege attempted to rely on privileged information
as claim or defense); cf. Brogan v. Passaic Daily News,
22 N.J. 139, 151-52 (1956) (holding that newspaper had waived Shield Law
privilege by relying on quality of informant in defense to libel
action), overruled in part by Maressa v. New Jersey Monthly,
89 N.J. 176, 194-96 & n.8 (relying on statutory amendment to
overrule Brogan waiver holding in Shield Law context), cert.
denied,
459 U.S. 907,
103 S. Ct. 211,
74 L. Ed.2d 169 (1982).
To allow such conduct would be truly inequitable. As the court
stated in Wolosoff, supra:
We note the inherent inequity in permitting
[a party] to use the privilege as a sword
rather than a shield. If permitted to do so,
[a party] could divulge whatever information
is favorable to its position and assert the
privilege to preclude disclosure of the
detrimental facts. The resulting half-truth
that would be revealed might well be more
disabling than a total distortion.
See also Chodoff, supra, at 4 (noting the "well-reasoned
arguments supporting the view that an employer may not assert as
a defense to a sexual harassment lawsuit the fact that it
conducted a prompt and thorough investigation and took reasonable
remedial action . . . without being required to disclose the
substance of the investigation which forms the basis for that
defense").
We note a recent federal decision that held, in
circumstances strikingly similar to this case, that the
defendant-employer had waived the attorney-client privilege
regarding the contents of its investigation when it had attempted
to use the results of the investigation to preclude liability
under the LAD and Title VII. Harding, supra, 914 F. Supp. at
1091-97. The court stated that the defendant had
attempted to utilize the results of [the
attorney's] investigation . . . as a defense
to liability . . . . Consequently,
[defendant] cannot now argue that its own
process is shielded from discovery.
Consistent with the doctrine of fairness, the
plaintiffs must be permitted to probe the
substance of [defendant's] alleged
investigation to determine its sufficiency.
Defendant attempts to avoid application of waiver by reasserting that its affirmative defense solely concerns the final result of its investigation, namely, the sanctions that it imposed on Geberth and Stankowitz. However, we have rejected that argument because of the relevance of the entire
investigatory process to plaintiff's attempt to overcome this
affirmative defense. Supra at __-__ (slip op. at 9-12).
Thus, it appears that defendant, by relying on the
affirmative defense of having conducted an effective
investigation into plaintiff's allegations, has waived the
attorney-client privilege, assuming that the privilege applies to
certain documents relating to the investigation. However, the
trial court should conduct an in camera review of the materials
at issue to determine if the privilege applies to specific
documents, and, if so, whether those documents are so tenuously
related to the affirmative defense that waiver is overcome
despite the assertion of that defense.
Our analysis of the applicability of the work-product doctrine is similar to that of the attorney-client privilege. In order for the doctrine to apply, the materials must have been prepared in anticipation of litigation and not in the ordinary course of business, Wylie, supra, 195 N.J. Super. at 337, and there must not be a "substantial need" for the materials. R. 4:10-2(c); Jenkins v. Rainner, 69 N.J. 50, 58 (1976). Moreover, the doctrine's protection must not have been waived. In re Envtl. Ins. Declaratory Judgment Actions, 259 N.J. Super. 308 (App. Div. 1992).
We believe that the work-product doctrine most likely does not protect the investigatory materials in this case. As we
noted in our discussion of the attorney-client privilege, the investigation allegedly began months before plaintiff commenced this litigation, although the conclusion of the investigation occurred after she had brought suit. In addition, plaintiff has demonstrated need for the documents relating to the investigation. The Appellate Division correctly noted that "[t]he information plaintiff may develop by deposing the same informants [who participated in the investigation] would not necessarily replicate what those informants told the Authority." 292 N.J. Supe