Guardian Storage Centers, LLC v. Simpson, 119 Cal. App. 5th 509 (2026)
After terminating the employment of Julie Simpson (Guardian’s COO), Guardian’s CEO/owner sued Simpson for a variety of claims, including breach of contract, interference with prospective economic advantage, and breach of fiduciary duty. Simpson cross‑complained against Guardian and the CEO for wrongful termination, sexual harassment (over the course of 14 years), and retaliation. There were other employment‑related claims filed by and against other former employees as well. During discovery, Simpson produced three emails that she had previously shared with her attorneys that were confidential attorney‑client communications between Guardian’s legal counsel and various of its owners and officers. Guardian’s counsel informed the employees’ counsel the emails were privileged and asked that they be returned and not be further used. Rather than return the emails, the employees’ counsel impermissibly reviewed them “in depth,” failed to notify Guardian in the first place about having them and indicated an intent to use them to support the employees’ claims in the litigation. The trial court denied Guardian’s motion to disqualify the employees’ lawyers. The Court of Appeal reversed the trial court and held it had abused its discretion by failing to appreciate the full scope of the prejudice caused by the disclosure and, therefore, the court should have disqualified the employees’ lawyers from the case. The appellate court distinguished Wellpoint Health Networks, Inc. v. Superior Court, 59 Cal. App. 4th 110, 128 (1997) on the ground that disclosure of the privileged emails in this case was not essential for a thorough examination of the adequacy of the investigation that Guardian had conducted into the employees’ claims.
