IP Tech Knowledgy

Business owners should consider using an outside, personal email address when communicating with legal counsel, accountants and other professionals about the potential sale of their business. This would apply throughout the discussion, negotiation, and eventual closing of the transaction. Keeping these communications off of the business’ computer server will ensure that these privileged and confidential discussions do not fall into the hands of an eventual purchaser of the business.

Although transaction documents often exclude from the sale all legally privileged communications, that solution often works better on paper than in practice. Many sellers do not actually go to the trouble of moving their email files off of the company server before closing. And even when the effort is made, it is not practical to purge back-up systems. As well, the accountant-client privilege is not as broad as the attorney-client privilege.

Using an outside, personal email address does bring challenges in the sale of business context. For example, given the volume of communications and documents that typically change hands, keeping track of it all will require establishment of a good outside filing system, but even that may not substitute for the extensive organizational tools that a typical document management system provides.

Whichever solution you chose, be mindful of who may have access to your communications in the future. The same concerns apply to any use of a company email address for personal matters.

Elliott Cowan
410-576-4108 • ecowan@gfrlaw.com