On January 6, 2022, Justice Ruchelsman of the Kings County Commercial Division issued a decision in HK Capital LLC v. Rise Dev. Partners LLC, 2022 NY Slip Op. 50024(U), holding that retainer agreements and information on a client’s payment of fees was not privileged, explaining:
In Kapon v. Koch, 23 NY3d 32, 988 NYS2d 559 [2014] the court held that third party subpoenas may be served whenever the information sought is material and necessary of any facts bearing on the controversy which will assist preparation for trial by sharpening the issues and reducing delay and prolixity. The court noted that so long as the disclosure sought is relevant to the prosecution or defense of an action, it must be provided by the nonparty. Thus, disclosure from a nonparty requires no more than a showing that the requested information is relevant to the prosecution or defense of the action. A party seeking to vacate or quash a third party subpoena has a burden establishing the information is utterly irrelevant or the futility of the process to uncover anything legitimate is inevitable or obvious.
In this case the plaintiff seeks documents from Mr. Pager to assist in the enforcement of any judgement and seeks information about the defendant’s assets, bank accounts and any asset transfers. It is well settled that absent special circumstances, retainer agreements, a client’s identity, invoices and the payment of fees are not subject to the attorney client-privilege. Indeed, any communication that does not have any direct relevance to any legal advice is collateral and not privileged. In Aurateq Systems International Inc., v. Black-NYC LLC, the court explained, citing earlier authority, that a client cannot assert the attorney-client privilege as to documents in the lawyer’s possession if they were not prepared for litigation or for the purpose of seeking or imparting legal advice and they are not otherwise subject to a privilege against disclosure. The mere circumstance that the documents were revealed in confidence to a lawyer does not of itself transform the papers into privileged communications. The court further noted that the information sought pursuant to an information subpoena, similarly sought in this case is commonly found in either bank or other financial records and in documents submitted to governmental agencies. A corporation cannot funnel its records and documents into the hands of its attorneys and then claim privilege. Individuals are likewise barred from employing the same expedient to avoid divulging information pursuant to a valid subpoena. Mr. Pager asserts that the law offices of William Pager’s interactions with the named defendants have been limited to strictly to legal advice, legal consultations and legal work involving the above described litigation. While that may be true the information sought pursuant to the information subpoenas is not legal advice and is not protected by the attorney client privilege. Therefore, the cross-motion seeking a protective order is denied. Mr. Pager will have twenty days from receipt of this order, and upload to the NYSCEF is considered sufficient receipt, in which to respond to the information subpoenas. The plaintiff’s motion is held in abeyance pending the court’s specific order contained herein that all the information sought in the information subpoenas must be disclosed by Mr. Pager.
(Internal quotations and citations omitted) (emphasis added).