Two Federal Court Decisions in Three Days Misapply the General Choice of Laws Rules in Diversity Cases: Part II

Last week’s Privilege Point noted that some federal courts erroneously apply their host state’s substantive privilege law rather than properly applying their host state’s choice of law rules — which might result in another state’s privilege law applying. Other courts correctly follow the majority approach — under the 1971 Restatement (Second) of Conflict of Law, Section 188, which logically applies the privilege law from the state with the “most significant relationship” with the parties and the matter.

But some states follow the Restatement (First) approach — under which the court applies its host state’s privilege law. Ten years ago, a Privilege Point noted the type of nonsensical decision this approach can spawn. In Skepnek v. Roper & Twardowsky, LLC, the court handling a diversity case properly looked to Kansas choice of law rules — almost apologetically explaining that Kansas follows the “older, minority approach” of the Restatement (First) of Conflict of Laws (1934). Case No. 11-CV-4102-DDC-JPO, 2014 U.S. Dist. LEXIS 122918, at *10 (D. Kan. Sept. 4, 2014). The court therefore applied Kansas privilege law to emails among “New Jersey clients communicating with their New Jersey law firm about a New Jersey lawsuit.” Id. at *11-12. Not surprisingly, the court acknowledged that those New Jersey clients “may find it unusual that Kansas state law determines whether their e-mails are privileged.” Id. at *12. No kidding.

Although this type of daffy decision might make some litigants wish “we’re not in Kansas anymore,” Illinois is the real danger spot — next week’s Privilege Point will explain why.

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