I promise no Neil Sedaka references.
It’s not uncommon for lawyers to contact me for guidance when leaving a law firm to practice somewhere else. I’ll share some of that guidance later in this post. I’ll start, however, with guidance on what not to do:
- Don’t steal client files from the firm you’re leaving.
Last month, a Missouri court ordered a lawyer to pay approximately $775,000 to her former firm for conduct associated with improperly taking files when she departed. The order followed prior contempt findings that, among other things, resulted in the lawyer spending two nights in jail. The ABA Journal, St. Louis Post-Dispatch, Legal Reader, and Professor Bernabe’s Professional Responsibility Blog reported on the story.
As best as I can determine . . .
. . . the lawyer left her firm in February 2018. During an exit interview, she told the firm that she had not taken any client files or information belonging to the firm. In fact, one week prior to leaving, the lawyer impermissibly transferred more than 22,000 data files (including client files) to a flash drive. Many of the client files she took belonged to clients for whom she had never done any work.
The firm found out almost immediately and filed for injunctive relief. The firm and the lawyer entered into a consent order under which the lawyer agreed to return the data files and destroy electronic copies.
She didn’t. As a result, in January 2019, she was held in contempt, ordered to abide by the consent order, and ordered to make her devices available for forensic review.
She didn’t. Once she did, a forensic inspection revealed that, after the initial contempt finding, the lawyer and an assistant transferred files from her devices to the cloud. The court concluded that the lawyer moved the files to the cloud as part of an attempt to hide the fact that she continued to possess copies. As a result, she was held in contempt (again!) and ordered to spend two nights in jail.
Last month, the lawyer filed a confession of judgment in which she admitted her wrongs and agreed to pay her old firm $557,252.08.
Yes – over half a million dollars. Talk about no more carefree laughter.
Anyhow, my recap likely understates the (mis)conduct. For more, check out the July 2019 contempt order, the August 2019 contempt order, the confession of judgment, and the final order.
That’s what not to do.
As for a “to do” list, I’ve included several helpful resources at the end of this post. Many draw from ABA Formal Opinion No. 99-414: Ethical Obligations When a Lawyer Changes Firms.
The key takeaway from ABA Opinion: both the firm and the departing lawyer must ensure that the lawyer’s departure does not have a “material adverse effect on the interests of the clients with active matters upon which the lawyer is currently working.”
Here’s an outline of the rest of the ABA Opinion:
- Notice to clients. The firm and lawyer should provide notice of the lawyer’s “pending departure in a timely fashion to clients for whose active matters (s)he currently is responsible or plays a principal role in the current delivery of legal services.”
- Who sends it? When possible, joint notification from the firm & departing lawyer is preferred.
- when the lawyer is leaving & where the lawyer is going;
- whether the firm & lawyer are able & willing to continue representing the client;
- that the client has the absolute right to choose to remain with the firm, to go with the lawyer, or to secure new representation altogether.
- Do not include: The departing lawyer “should not urge the client to sever its relationship with the firm . . . [or] disparage the firm.”
- Other considerations. The departing lawyer should be mindful not to:
- engage in any conduct that is deceitful or dishonest (secreting files is big no-no);
- do anything that would put client property, data, information, or confidences at risk; or,
- improperly solicit business from clients with whom the lawyer has no prior working relationship.
Meanwhile, the firm should ensure that the client file and any unearned fees follow the client if the client leaves the firm. (I’d caution against transferring a file or funds without the client’s written consent.)
When a lawyer leaves a firm for other pastures, the issue that seems to arise the most involves what, if anything, the departing lawyer may keep. Per the ABA Opinion, the departing lawyer might want to retain “files and other documents such as research memoranda, pleadings, and forms.” If so,
- “to the extent that these documents were prepared by the lawyer and are considered the lawyer’s property or are in the public domain, she may take copies with her. Otherwise, the lawyer may have to obtain the firm’s consent to do so.”
That being said, a lawyer who is leaving a firm should exercise restraint when packing. Here’s a blurb from the Illinois Attorney Registration & Disciplinary Commission’s Leaving a Law Firm: A Guide to the Ethical Obligations in Law Firm Departure:
- “The departing lawyer may not remove client files without the client’s consent and even when the client requests to have the file transferred to the departing lawyer, the file should not be removed until the firm has been given notice and opportunity to copy the file. See In re Cupples, 952 S.W.2d 226, 236-37 (Mo. 1997) (lawyer reprimanded for violating his duties to former law firm and law firm’s client by removing files without client consent); Maryland Attorney grievance Comm’n. v. Potter, 844 A.2d 367 (Md.2004) (90-day suspension on departing associate who secretly removed two client files and destroyed firm’s computer records for those clients even though lawyer believed he was acting in clients’ best interests out of concern the law firm might act to thwart their choice).”
Or, as the San Diego County Bar Association advises:
- “In those circumstances where a departing attorney wants to take client’s files from his/her existing firm, the departing attorney should consider whether those documents were created for the attorney’s general use or were they created specifically for the client’s representation.”
I’ll end with this.
A very good friend once told me that if things ended well, they wouldn’t end. Excellent point, and one that made sense in the context of what we were discussing.
However, in the context of a lawyer’s departure from a law firm, I prefer “some things end better than others.” Thus, I think it’s critical for lawyers and firms not to make the breakup any worse than necessary. Or, as the Washington State Bar Association concluded last year in Advisory Opinion 201801:
- “The personal dynamics of a lawyer departing a firm have the potential to outrun the important professional obligations all concerned have toward the clients involved. Lawyers and their respective Old and New Firms must ensure that client considerations remain paramount despite the often-difficult personal dynamics involved.”
In other words, do no harm to the client.
That’s good advice.
Because breaking up isn’t easy, I know. Sparing the client harm? Knowing me, knowing you it’s the best we can do.
See. I told you there’d be no Neil Sedaka references.