www.loubar.org 6 Louisville Bar Briefs PROFESSIONAL EXCELLENCE (Continued on next page) Translating Tax: How the Kovel Doctrine Extends Privilege to Experts in Tax Litigation Helen V. Cooper and Lucy McAfee For many, tax is like a foreign language. Attorneys frequently leverage expert assistance to help “translate” complex tax concepts. In litigation, this assistance can be vital to understanding the underlying transaction. However, without careful planning, the retention of experts can inadver- tently waive privilege. The Kovel Doctrine bridges the gap between privileged communications and expert assistance. In 1961, the Second Circuit recognized that attorney-client privilege could be extended to vari- ous experts, and specifically tax accountants. United States v. Kovel, 296 F.2d 918 (2d Cir. 1961). Since then, the majority of courts have adopted the Kovel Doctrine to the attorney-client privilege, work product doctrine or both. See, e.g., Dublin Eye Assocs., P.C. v. Mass. Mut. Life Ins. Co., No. 5:11–CV–128–KSF, 2013 WL 653541 (E.D. Ky. Feb. 21, 2013). There are limitations to the doctrine so it is important for practitioners to understand the boundaries to effectively preserve privilege. Kovel and its Progeny Kovel was a former IRS agent who used his accounting skills in connection with his law firm employment. Kovel, 296 F.2d at 919. Under attorney supervision, he engaged in confidential client communications. One of these clients, Hopps, was the subject of a grand jury investigation related to federal income tax violations. Id. Kovel was called by the grand jury to testify against Hopps, but at the direction of his employer, asserted that attorney-client privilege barred him from answering certain questions. Despite pressure from the assistant United States attorney and district judge, who both contended that the attorney-client privilege did not apply to ac- countants, Kovel remained firm and was held in contempt of court. Id. at 919–20. The Second Circuit evaluated Kovel’s claims by looking to the basic elements of the attorney- client privilege from Wigmore’s Code of Evidence: (1) Where legal advice of any kind is sought, (2) from a professional legal adviser in his capacity as such, (3) the communications relating to that purpose, (4) made in confidence (5) by the client, (6) are at his instance permanently protected, (7) from disclosure by himself or by the legal adviser, (8) except the protection be waived, save (7); literally, none of them is within (7) since the disclosure is not sought to be compelled from the client or the lawyer. Id. at 921–22 (quoting 8 Wigmore § 2292, Evidence; 53 A.L.R. 369 (Originally published in 1928)). Analogizing that “[a]ccounting concepts are a foreign language to some lawyers in almost all cases, and to almost all lawyers in some cases,” the Second Circuit reasoned that: [t]he presence of an accountant…while the client is relating a complicated tax story to the lawyer, ought not to destroy the privilege, any more than would that of the linguist in the second or third variations of the foreign language…the presence of the accountant is neces- sary, or at least highly useful, for the effective consultation between the client and the lawyer which the privilege is designed to prevent. Id. at 922. It is “vital to the privilege” that the communication in question “be made in confidence for the purpose of obtaining legal advice from the lawyer.” Id. Any communications in furtherance of accounting services or advice of the accountant would be outside the scope of the privilege. Id. The result is a fact-specific inquiry into the nature of any potentially privileged communication. More recently, the U.S. District Court for the Middle District of Louisiana weighed in on the limits of the Kovel Doctrine. See United States v. Melissa Rose Barrett; No. 3:22-cr-00071 (M.D. La. 2023). In Barrett, a law firm employed an accountant who prepared, signed and submitted a collection information statement to the IRS on behalf of a client. The forms omitted material information about the client’s finances, which became the subject of an indictment for criminal tax evasion. The government subpoenaed the accountant’s testimony, and her employer filed a motion to quash based on the attorney-client privilege and work product doctrine. In a decision that provides some insight into how a court will evaluate the Kovel Doctrine, the Barrett court denied the motion to quash because the firm did not show that the potentially privileged communications involved (1) translating “complex tax terms into a form intelligible The Louisville Bar Association recently concluded its annual Summer Law Institute (SLI), held from Saturday, June 14, through Saturday, June 19, 2025, at the Bar Center. This immersive program welcomes local high school students eager to explore a career in law. Throughout the week, participants engaged in dynamic panel discussions, toured the courthouse and capped off their experience by presenting a mock trial. Admission to SLI is competitive; students apply and are selected based on their GPA, letters of recommendation and a submitted essay. This year, we proudly accepted 32 stu- dents, with more than half of the class being either recent May graduates or rising seniors. This invaluable program is made possible thanks to a generous grant from the Louisville Bar Foundation. Their support allowed us to award a record 12 scholarships, ensuring that tuition costs are not an obstacle for families who might otherwise be unable to afford this enriching experience. Finally, a huge thank you to the Bellarmine Mock Trial Team for dedicating almost 20 hours of time to help our students prepare for their mock trial. We also extend our gratitude to Judge Yvette De La Guardia, Jefferson District Court, Div. 4, and John Young, Executive Director of the Legal Aid Society, for presiding over the court! Bellarmine Mock Trial Team Shamir Patel Jack Wathen Norah Wulkopf We extend our sincere gratitude to the following speakers who generously dedicated their time to share their expertise with our students: Benjamin Barberie Hon. Joan L. Byer Jason Cebe Hon. A.C. McKay Chauvin Ryane E. Conroy Jasmine Cox Amy D. Cubbage Seth A. Gladstein Amy I. Hannah Zoe Jessie Deana Lively Marc S. Murphy Sean P. Oates Heend S. Sheth Nicholas Stiegelmeyer Claude O. Tackett Erin C. White Milja Zgonjanin “I didn’t know how many opportuni- ties there were in the legal field and the importance of each part. Learning this surprised me as I was able to learn about how they all connect and really figure out what and who I want to be in the future by looking at all the op- portunities.” - SLI participant, 2025
