Legislation reversing a recent Texas Supreme Court decision regarding the attorney-client privilege in a workers’ compensation context has been scheduled for hearing in Senate State Affairs tomorrow morning. In In re XL Specialty Insurance Company and Cambridge Integrated Services Group, Inc. (No. 10-960, June 29, 2012), the Court ruled that the attorney-client privilege (Tex.R.Evid. 503(b)) does not apply to a communication between a lawyer representing a workers’ compensation carrier and the employer regarding an administrative proceeding regarding an employee’s workers’ compensation claim, when the employee subsequently files suit against the carrier and its third party administrator for breach of the common law duty of good faith and fair dealing and violations of the Insurance code and the Texas Deceptive Trade Practices Act. Thus, the employee could discover the prior communication between the insurer’s outside counsel and the employer.
HB 1468 by Rep. Kenneth Sheets (R-Dallas) and Sen. Joan Huffman (R-Houston) corrects this decision by protecting the confidentiality of communications between a workers’ compensation insurance carrier and a covered employer if the communications concern mental impressions, opinions, conclusions, claims-handling strategies, litigation strategies, legal theories regarding the claim, claim status, claim reserves, or the proprietary business practices of the insurance carrier or convered employer, or other information regarding a covered employer’s rights. TCJL supports this legislation.