Passed in July 2019, Senate Bill No. 339 caused three new statutes to be added to California’s Business and Professions Code (BPC), which took effect on January 1, 2020. Proponents of the Bill, seeking to assist the Board for Professional Engineers, Land Surveyors and Geologists in its consumer protection mandate, identified the nondisclosure agreements typically signed by experts hired by lawyers as potential roadblocks preventing these experts from reporting information about incidents of professional negligence or misconduct that could be relevant to the Board. The Bill seeks to remedy this issue. It directs that if a licensed professional engineer (BPC § 6789), geologist or geophysicist (BPC § 7874), or land surveyor (BPC § 8790.5) is retained as an expert witness and enters into a nondisclosure agreement, that agreement cannot be construed to prevent the licensee from reporting a potential violation of the practice act to the Board.
The Bill does not prohibit affected licensees from entering into nondisclosure agreements. Importantly, each of the new statutes contains a provision explicitly directing that it “shall not be construed to be, or act as, a waiver of any applicable attorney-client or attorney work product privileges.” Questions about the breadth of these new reporting statutes nonetheless seem likely to arise. How much information is sufficient for a licensee to provide to meet its obligation of “reporting a potential violation” to the Board? Could the attorney-client or work product protections be waived if the expert ‘over-shares’ by providing otherwise privileged materials to the Board that arguably were not strictly necessary for the expert to meet its reporting obligation? While the intent of the new statutes is clearly to enhance consumer protection by removing obstacles to the reporting of malpractice in these practice areas, retained experts are well aware of the important contractual obligations they have to their own clients as well. Time will tell, but for now, careful thought and coordination with the lawyer who retained the expert should occur on a case-by-case basis before determining what privileged materials should be provided to the Board to report a potential violation.