A recent Sixth Circuit decision, In re: FirstEnergy Corp., provides essential guidance on protecting privileged materials and work product for companies conducting internal investigations in response to regulatory or litigation threats. On October 3, 2025, the court of appeals (which includes Tennessee) vacated a district court order requiring FirstEnergy to disclose investigation materials to shareholders, holding that attorney-client privilege and work-product protections apply when the primary purpose is legal advice — even if the findings also inform business decisions.

Case Background

FirstEnergy Corporation initiated two internal investigations after federal charges were filed against a state legislator implicating FirstEnergy in a bribery scheme. FirstEnergy shareholders sought access to the internal investigation materials to understand the scope of the alleged bribery and to assess whether the corporate leadership made decisions that harmed the company. They argued that the documents reflected business strategy and governance choices, not purely legal advice, and therefore should not be shielded by privilege. The Sixth Circuit rejected this argument, emphasizing that privilege turns on the purpose of the communication, not its later use.

Implications for Internal Investigations and Other Legal Advice

The decision reinforces that attorney-client privilege and the work-product doctrine remain applicable when the primary purpose of an internal investigation is to obtain legal advice or prepare for litigation even if the investigation’s findings also inform business decisions.

Companies should clearly articulate the purpose of an internal investigation from the outset. Engagement letters, board minutes, and communications with legal counsel should explicitly state that the investigation is driven by legal risk. While the privileges do not protect the underlying facts of the investigation, information relevant to the legal issues should be identified as part of the investigation in order to avoid inadvertent waiver of the privilege. Access to sensitive materials should also be tightly controlled to prevent inadvertent waiver. Internal investigations often serve both legal and business purposes, and clarity in documentation and process is key to maintaining protection.

Adopting a proactive approach to managing privilege will supplement an organization’s documentation of the legal basis for an investigation. Personnel involved in the investigation should be educated on the fundamentals of attorney-client privilege and work product protections and preparing privilege logs early in the investigatory process will help eliminate questions regarding the purpose of legal advice. Regular audits of internal investigation protocols can help identify and mitigate waiver risks before they become costly mistakes.

Additional Issues to Consider

• Regulatory Cooperation vs. Privilege Preservation: Companies often face pressure to share findings with regulators to demonstrate good faith. Disclosure to one regulator is likely to waive the privilege with other governmental entities. Striking the right balance between transparency and protection is critical.
   
• Third-Party Risks: Sharing investigation results with auditors, consultants, or insurers can inadvertently waive the attorney-client privilege. Companies should have a clear understanding of the implications of disclosing materials containing any legal opinion or privileged client communication. Disclosures beyond pure facts could jeopardize the privileges. Companies should limit any necessary third-party disclosures to nonprivileged information.
   
• Board Oversight: While the privilege does not disappear simply because findings inform governance decisions, boards should understand that unnecessary circulation of sensitive materials could expose information underlying business decisions even if they are borne out of a privileged investigation.

For more information, please contact us or your regular Parker Poe contact. Click here to subscribe to our latest alerts and insights.