Attorney-Client Privilege Shields Non-Compete Advice, Pennsylvania Supreme Court Rules
In a pivotal decision, the Pennsylvania Supreme Court has ruled that attorney-client privilege fully protects confidential communications between corporate counsel and employees regarding non-compete agreements, shielding businesses from forced disclosure in trade secret disputes. With attorney-client privilege non-competes, Pennsylvania Supreme Court ruling, employee non-compete privilege, corporate privilege trade secrets, and non-compete litigation 2025 trending, this ruling strengthens corporate defenses amid evolving federal restrictions on restrictive covenants.
The Ruling: A Fortress for Confidential Legal Advice
On September 18, 2025, the Pennsylvania Supreme Court unanimously upheld that discussions between a company’s in-house counsel and employees about non-compete clauses are protected under attorney-client privilege. The case, Korro Bio, Inc. v. Jane Doe, centered on a former executive who, after joining a competitor, sought internal emails between HR, management, and counsel discussing her non-compete terms to challenge their enforceability in a trade secret misappropriation lawsuit.
The court ruled that these communications, made to obtain legal advice, fall squarely within privilege protections, even when intertwined with business strategy. Relying on the U.S. Supreme Court’s Upjohn Co. v. United States (1981), the decision extends privilege to employee interactions directed by management for legal purposes, rejecting the plaintiff’s claim that business motives waive protection.
Case Details: From Discovery Fight to High Court Victory
The dispute originated in 2024 when the executive sued Korro Bio in Pennsylvania’s Superior Court, alleging her non-compete was overly restrictive. She subpoenaed internal communications, arguing they were discoverable as business records. The trial court quashed the subpoena, citing privilege, but an appellate panel ordered an in-camera review to assess mixed-purpose communications.
The Supreme Court reversed, clarifying that advice on non-competes is privileged if primarily legal in nature. “The client’s intent to seek legal guidance governs, not the presence of business context,” Justice Christine Donohue wrote. No waiver occurred, as the emails remained confidential within the corporation.
Background: Non-Competes Under Fire, Privilege as a Shield
Non-compete agreements, restricting employees from joining rivals, face intense scrutiny following the FTC’s April 2024 proposed nationwide ban, currently stalled by a Texas federal court injunction. Pennsylvania enforces reasonable non-competes, balancing employer trade secret protection with worker mobility. About 18% of U.S. workers—30 million people—are bound by such clauses, per BLS data.
Attorney-client privilege, rooted in common law and Pennsylvania’s Rule 1.6, ensures candid legal consultations. Upjohn (1981) extended this to corporate employees, but disputes often arise over mixed legal-business advice, especially for in-house counsel. This ruling clarifies that non-compete discussions, critical to IP protection, remain shielded when seeking legal input.
Expert Opinions and Public Reactions: A Corporate Win, Worker Worries
Employment law experts hailed the decision. “This is a lifeline for companies navigating FTC uncertainty,” said Villanova Law Professor Ann Juliano, noting it protects strategic planning. Critics, including plaintiff-side attorneys, argue it could shield overbroad non-competes, making challenges harder for workers.
On X, corporate counsel celebrated: “Privilege upheld! No more fishing expeditions in trade secret cases.” Labor advocates countered, with one post stating: “This tilts the scales—workers need discovery to fight unfair clauses.” The Pennsylvania Bar Association plans webinars to unpack the ruling’s impact on HR practices.
Impacts on U.S. Businesses and Workers: Economy, Jobs, and Beyond
This ruling reverberates through the $1.5 trillion U.S. employment services sector. Economically, it bolsters companies in tech and biotech hubs like Pittsburgh and Philadelphia, where trade secrets drive $50 billion in annual innovation. Firms can now strategize non-competes without fear of exposure, potentially stabilizing R&D investments.
For workers, it complicates challenges to restrictive clauses, limiting job mobility for 1 in 5 professionals. Lifestyle impacts hit hard—delayed job switches strain finances, especially in high-cost states. Politically, it fuels 2026 midterm debates over FTC reforms and labor rights, with Pennsylvania’s swing-state status amplifying stakes.
Technologically, it intersects with AI-drafted non-competes, urging firms to ensure privilege in digital workflows. In sports law, it protects team counsel advising on coach or staff non-competes, indirectly shaping NIL deal strategies for college athletes.
A Stronger Shield for Corporate Strategy
The Pennsylvania Supreme Court’s ruling fortifies attorney-client privilege for non-compete advice, ensuring businesses can protect trade secrets without risking disclosure. As attorney-client privilege non-competes, Pennsylvania Supreme Court ruling, employee non-compete privilege, corporate privilege trade secrets, and non-compete litigation 2025 dominate headlines, this decision empowers employers while highlighting tensions with worker rights. With FTC battles looming, expect further legal clashes to define the balance between corporate protection and employee freedom in America’s evolving workplace.
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