Litigation Privilege In Maryland

The Maryland Court of Appeals has decided a case involving the litigation privilege

The litigation privilege immunizes a party for statements made in a judicial proceeding and is fundamental to the courts’ truth-finding mission. We have previously analyzed this privilege only in the defamation context. Today we address two distinct questions that arise out of a dispute between a city and a design engineer’s settlement agreement to, among other things, not disparage one another. Can the litigation privilege immunize a party from a claim for breach of a non-disparagement clause? If so, can a party waive that privilege? We examine these questions to determine whether a trial court correctly granted a motion to dismiss a complaint for failure to state a claim for breach of contract.

Judge Adkins for the majority reviews in detail the history of the privilege and concludes

there is nothing in the Settlement Agreement addressing whether the City could discuss OBG’s design work or portray OBG in a negative light in the CDG Lawsuit, litigation the parties clearly anticipated. Applying a rebuttable presumption against waiver of the litigation privilege, we conclude that the City did not waive the litigation privilege in the non-disparagement clause, and the Circuit Court correctly granted the City’s Amended Motion to Dismiss.

Judge Harrell concurred and dissented

Although I agree with the Majority opinion’s determinations that: (1) the case is not moot (Maj. Slip op. at 8-11); (2) the City’s non-preservation argument is without merit (Maj. Slip op. at 11-13); (3) the litigation privilege is not absolute (Maj. Slip op. at 15-16; (4) the litigation privilege may apply to causes of action sounding in contract (Maj. Slip op. at 16-18); and, (5) the litigation privilege may be waived, which analysis is undertaken with a rebuttable presumption of non-waiver as a threshold (Maj. Slip op. at 24-26), I dissent from the judgment that the Court of Appeals’s affirmance of the trial court’s grant of the City’s motion to dismiss was correct as a matter of law.