Commodity Futures Trading Commission v. Weintraub, 471 U.S. 343 (1985) (U.S. Supreme Court)
Commodity Futures Trading Commission v. Weintraub is the Supreme Court's leading decision on who controls a corporation's attorney–client privilege after the corporation enters bankruptcy.
When a corporation enters Chapter 7 bankruptcy and a trustee is appointed, who controls the corporation's attorney–client privilege with respect to prebankruptcy communications: the trustee or the corporation's former officers and directors?
In a Chapter 7 corporate bankruptcy, the trustee, as the representative and manager of the estate, controls the corporation's attorney–client privilege and may waive it with respect to prebankruptcy communications; former officers and directors of the debtor-corporation cannot assert the corporation's privilege over the trustee's objection. See 11 U.S.C. §§ 323 (trustee as representative of the estate), 541 (property of the estate), and 704(4) (duty to investigate the debtor's financial affairs).
The Supreme Court held that the Chapter 7 trustee, not the debtor-corporation's former management, controls the corporation's attorney–client privilege and may waive that privilege with respect to prebankruptcy communications. Former management cannot assert the corporate privilege to block the trustee's waiver.
Weintraub is the definitive statement that corporate attorney–client privilege adheres to control of the entity, not to particular managers. In Chapter 7, the trustee holds that control and may waive prepetition privilege to fulfill statutory duties to investigate and recover assets. The decision prevents former insiders from leveraging the corporate privilege to obstruct investigations into potential misconduct that harmed creditors. For law students, Weintraub is a critical precedent in evidence and bankruptcy: it illuminates who is the client in the corporate context, how privilege travels with corporate control, and the role of the Bankruptcy Code in shaping evidentiary rights post-petition. The case also signals, by analogy, that in Chapter 11 a debtor-in-possession ordinarily exercises the trustee's powers and thus typically controls the corporate privilege, subject to court oversight.