The Self-Critical Analysis “Privilege”

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June 15, 2015
Mike McGowan
SmithAmundsen Legal Update

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The process of conducting internal investigations in order to enhance safety is a double-edged sword for companies. On the one hand, self-critical analysis often involves the creation of incident reports when an accident or injury occurs involving an employee, which can lead to safer practices and result in less litigation. On the other hand, self-critical documents may be discoverable and utilized by plaintiff attorneys in order to prove liability.

In 1970, a self-critical analysis privilege was first recognized by some courts in an attempt to encourage businesses to conduct internal investigations without fear of the same investigations being used against them in litigation. The Illinois Supreme Court recently declined to recognize the self-critical analysis privilege at the state level, instead leaving such determinations to the legislature. Similarly, the federal court which governs Illinois also declined to recognize the existence of the self-critical analysis privilege at the federal level. Therefore, an Illinois company should not rely on this privilege to protect the disclosure of its internal audits.

Indeed, none of the federal courts have adopted the self-critical analysis privilege. The federal courts which do recognize the existence of the privilege apply it so narrowly as to render it inapplicable. Thus, at the federal court level, a company should not expect the self-critical analysis privilege to protect its internal audits from disclosure.

At the state court level, the self-critical analysis privilege is widely rejected. Although nearly every state has adopted a statutory privilege for peer-review materials in the hospital setting and more than half of the states have adopted environmental audit privileges, the self-critical analysis does not enjoy such support in other contexts. Courts are hesitant to create a new common law privilege absent legislative guidance. As a result, even where state courts engage in an analysis as to the applicability of the self-critical analysis privilege as a common law privilege, they consistently find that it does not apply. 

What does this mean for you?

Companies that create incident reports and internal audits should expect those materials and documents to be discoverable in litigation in virtually every state and federal court.