Isaac "Ike" Perlmutter, the reclusive chairman of Marvel Entertainment whose DNA was surreptitiously collected while testifying in a lawsuit, is now primed to become the poster boy on another privacy matter. On Monday, a New York judge entered an order that concludes Perlmutter waived the right to invoke attorney-client privilege on certain communications to his attorney by sending those messages on Marvel's email server.
Toronto businessman Harold Peerenboom is suing Perlmutter for allegedly smearing him in an anonymous hate-mail campaign. The dispute between billionaires, which first erupted over access to tennis courts at a swanky Palm Beach residential community, has grown particularly nasty. Perlmutter has filed counterclaims in a Florida court after having his DNA taken at a deposition in Peerenboom's gambit to prove Perlmutter was responsible for the hate mail, including ones sent to more than a thousand inmates in prisons across Florida and Ontario, Canada.
The two sides are engaged in a discovery fight, and late last year, Peerenboom went to a New York court to get Marvel to comply with a subpoena. In response, Perlmutter moved for a protective order barring Marvel from producing copies of certain email messages, arguing they were protected by attorney-client privilege.
New York Supreme Court Judge Nancy Bannon rejected the argument.
"Disney's computer usage policy prohibits personal and other objectionable use of Marvel's server and email system," states Bannon. "Disney/Marvel had the right to monitor the use of all employees' computer usage, third parties have a right of access to the computer, Disney/Marvel expressly asserted a possessory interest in all emails sent and received on its servers, and Perlmutter was or should have been aware, as Marvel's Chairman or CEO, that Marvel implemented Disney's use and monitoring policies."
Given this, and with a nod to the four factors articulated in a 2005 bankruptcy court case (In re Asia Global Crossing), Bannon concludes a finding is warranted "that Perlmutter did not have a reasonable expectation of privacy in connection with electronic messages sent and received on Marvel's server, and has waived the attorney-client and work-product privileges in connection with them."
What's more, Bannon says that for similar reasons, Perlmutter also has waived the privilege on communications made on his behalf by any "agent" working at Disney or Marvel. Perlmutter also can't shield messages to his accountant.
Perlmutter wins on only one point. The messages that the Marvel chairman sent or received from his wife, Laura, are protected by marital privilege.
"While the use of a proprietary email system that is subject to a policy such as Disney's effects a waiver of any privileges that can otherwise be unilaterally asserted, it does not abrogate such privileges where another's consent is necessary to effect a waiver," states Bannon. "The proper application of CPLR 4502(b) thus requires the conclusion not only that Perlmutter cannot be compelled to testify against Laura in the Florida defamation action but cannot, without her consent, waive her marital privilege by sharing their confidential communications with third parties."
In other words, the spousal emails were saved by the fact that Laura doesn't work for Marvel nor was aware of Disney's email usage policy.
A spokesperson for the Perlmutters hints at an appeal with broad stakes.
"While it doesn't change the fact that there is no evidence to support Mr. Peerenboom's baseless lawsuit, we believe this decision sets a dangerous precedent and is contrary to law, and we intend to seek further review," says the spokesperson. "The attorney-client privilege and other privileges addressed in the Court's decision are sacrosanct legal principles that should not be so significantly eroded, especially on behalf of Harold Peerenboom, a serial litigant who was recently found by a Florida court to have illegally collected and tested the Perlmutters' DNA and lied about it in his testimony."