Conflicts: when are competing interests “materially adverse?”

As many lawyers know, identifying conflicts can be tricky.  That’s why, in my opinion, trusting your gut isn’t the worst approach.  As I’ve often mentioned, if it feels like a conflict, it probably is.

Alas, “but I didn’t feel it in my gut!” probably isn’t the best response to a motion to disqualify or disciplinary complaint. So, let’s go a bit deeper.

Conflicts

At least seven different rules address various types of conflicts.  Today, I’ll refer to three: V.R.Pr.C. 1.9(a), V.R.Pr.C. 1.9(b), and V.R.Pr.C. 1.18.  They apply when matters are the same or substantially related, and a prospective or current client’s interests are materially adverse to the interests of, respectively,

  • a former client;
  • someone represented by a law firm with which a lawyer was formerly associated; and,
  • a prospective client who met with but did not retain the lawyer.

More specifically, this post is intended to call your attention to the phrase “materially adverse.” 

Why? 

Because this morning, the ABA’s Standing Committee on Legal Ethics & Professional Responsibility issued Formal Advisory Opinion 497 – Conflicts Involving Materially Adverse Interests.

As always, what follows is a summary.  It is not a substitute for reading the advisory opinion itself.

Per the opinion, there are 2 situations in which material adversity is clear:

  1. Suing, litigating, or negotiating with a former client. I like the Committee’s use of two questions: in litigation, are you on the other side of the “v”? Or, in a transaction, are you sitting on the other side of the table?
  2. Attacking your own prior work or legal advice.

Next, the opinion advises that material adversity often, but not always, exists when competent representation will require a lawyer to cross-examine a former or prospective client.  Here, don’t spend too long trying to convince yourself “but the conviction, testimony, or conduct relevant to my former representation is public record.”  That is NOT the standard.  As regular readers know, the fact that information relating to the representation of a former client is “public record” doesn’t necessarily mean that it’s “generally known.”  Says who?  This blogger.

Finally, the Committee notes that material adversity can exist even in the absence of direct adversity.  For instance, it

  • “may exist when the former client is not a party or a witness in the current matter if the former client can identify some specific material legal, financial, or other identifiable concrete detriment that would be caused by the current representation. However, neither generalized financial harm nor a claimed detriment that is not accompanied by demonstrable and material harm or risk of such harm to the former or prospective client’s interests suffices”

Again, check out the opinion.

Now, an important reminder.

In my judgment, the analysis doesn’t end once a lawyer concludes that the lawyer does not have a conflict.  Rather, to me, competent representation includes asking “self, do client and I want to deal with this?”  That is, conflict or not, people are (naturally) upset to find their lawyer on the other side of the v or the table.  A motion to disqualify will delay resolution of your new client’s matter.  Moreover, even if the disciplnary complaint is ultimately dismissed, nobody likes receiving the email in which I let them know that it has been filed against them.

As always, be careful out there.

hill street blues

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