Conflicts of Interest Involving Former Clients

Conflicts lie at the core of many inquiries of bar counsel. They can be difficult to assess.  A particular area of difficulty is whether duties to a former client create a conflict that prohibits representation in a new matter.

Let’s use the following as our baseline:

• Lawyer represented Former Client in Matter 1.  The representation has concluded and there is no doubt that Former Client is, as the name suggests, a former client.
• New Client would like to hire Lawyer in Matter 2.

We begin with V.R.Pr.C. 1.9(a):

• “A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person’s interests are materially adverse to the interests of the former client unless the former client gives informed consent, confirmed in writing.”

So, the key questions are:

• Is Matter 2 the same as or substantially related to Matter 1?
• If so, are New Client’s interests in Matter 2 materially adverse to Former Client’s?

It’s not always productive to get stuck on the rule’s language. It can be easier to remember that the Supreme Court long ago described the rule as prohibiting lawyers from “switching sides.”[1]

Still, let’s go through the analysis. 

Are the two matters the same or substantially related?

While the answer to the former is often obvious, the answer to the latter frequently isn’t.  It’s critical to remember that the answer doesn’t turn only on the nature of the matters themselves. Rather, we must consider the nature of the information that the lawyer obtained in the first representation. As Comment [3] states:

• “Matters are ‘substantially related’’ for purposes of this rule if they involve the same transaction or legal dispute or if there otherwise is a substantial risk that confidential factual information as would normally have been obtained in the prior representation would materially advance the client’s position in the subsequent matter.” (emphasis added).

This scenario arises in many contexts. One is when a lawyer represents a client in a matter in which a former client is a witness for the other side. Often, the lawyer will have received confidential information from the former client that would materially advance the new client’s defense by undermining the former client’s credibility as a witness. Thus, while the two matters might appear on the surface to have nothing to do with each other, under the rule, they might be substantially related.[2]

One last point on the “substantially related” question: if two matters are substantially related, it’s irrelevant that the lawyer doesn’t remember anything about the first.  Knowledge of information as would ordinarily have been disclosed in the course of the representation is presumed and we will not force the former client to disclose it to protect it.[3]

Okay, so let’s assume that the two matters are the same or substantially related.  The next question is whether the new client’s interests are materially adverse to the former’s. 

Material Adversity

Last year, the ABA Standing Committee on Ethics & Professional Responsibility published Formal Opinion 497 – Conflicts Involving Materially Adverse Interests.  I blogged about it here.

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.[4] 

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.”

No Conflict? Continue to Exercise Caution,

Let’s assume that the new matter is not the same as or substantially related to the former matter, and the new client’s interest are not materially adverse to the former client’s interests.  In my judgment, that’s not the end of the lawyer’s analysis.  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 cost the new client time and money.  Moreover, the former client might file a disciplinary complaint.  Even if it is dismissed, it will weigh on the lawyer while pending.  Sometimes close enough is, in fact, close enough.

In closing, I remain of the opinion that when potential conflicts arise, it’s important to trust your gut. That said, I hope that today’s post provides a bit more insight into the rules.

As always, let’s be careful out there.

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[1] The opinion is here.  See also, this blog post, this video, and this update to the video.

[2] Even if they aren’t substantially related, the lawyer might still have a conflict.  Rule 1.9(c) prohibits the lawyer from revealing information related to the representation of the former client, as well as from using information related to the representation to the former client’s disadvantage. If complying with that duty creates of significant risk of materially limiting the representation of the new client, the lawyer has a conflict under Rule 1.7(a)(2). 

[3] See this blog post and this video. 

[4] 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.

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.

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.

Can a lawyer be sanctioned for revealing information that’s a matter of public record?

Today’s question: does the 1st Amendment prohibit the Supreme Court from sanctioning a lawyer who reveals client information that is public record?

Here’s how the issue would arise.

Rule 1.6 prohibits lawyers from revealing information relating to the representation of a client.  There are some exceptions.  They are:

• disclosure is impliedly authorized to carry out the representation;
• the client consents to disclosure;
• disclosure is required by Rule 1.6(b); or,
• disclosure is permitted by Rule 1.6(c).

As you see, “it’s public record” is not one of the exceptions.

Rule 1.6 applies to current clients.

With respect to former clients, Rule 1.9(c)(2) prohibits a lawyer from “revealing information relating to the representation as these rules would permit or require with respect to a client.”  Basically, the rule refers back to Rule 1.6 and does not include an exception for information that is “public record.”

Similarly, Rule 1.9(c)(1) prohibits a lawyer from using “information relating to the representation to the disadvantage of the former client except as these rules would permit or require, or when the information has become generally known.” (emphasis added).  As I’ve blogged several times recently, the ABA’s Standing Committee on Ethics and Professional Responsibility has opined that information that is in the public record is not necessarily “generally known.”  Here are the blog posts:

• March 2018:  ABA & Client Confidences: It’s Deja Vu All Over Again
• December 2017: Can’t keep quiet? Try harder.
• October 2017: Hey Lawyers! STFU!!!

The October post includes cites to several cases that stand for the notion that the prohibition against disclosing information relating to a representation is not lessened by the fact that the information is public record.  Or, for a more detailed explanation how broad the confidentialy rules are, the ABA’s Litigation News ran this article by Edward Feldman.

But there’s an important case that holds otherwise.  The case is Hunter v. Virginia State Bar.

Attorney Hunter blogged.  His posts caught the attention of the Virginia State Bar and resulted in a disciplinary prosecution.  The  VSB charged Attorney Hunter with violating the advertising rules.  Those charges aren’t relevant here.

What is relevant is that the VSB also charged Attorney Hunger with violating Rule 1.6 “by revealing information that could embarrass or likely be detrimental to his former clients by discussing their cases on his blog without their consent.”

At a disciplinary hearing, the VSB put on evidence that Hunter’s former clients “believe that the information posted was embarrassing or detrimental to [them], despite the fact that all such information had been previously revealed in court.”

Hunter was publicly admonished following a conclusion that he had violated both the advertising rules and Rule 1.6.

In an intermediate-level appeal, a circuit court upheld the advertising violations, but dismissed the 1.6 charge on the grounds that the rule, as applied, violated the 1st Amendment. An appeal to the Virginia Supreme Court followed.

On appeal, the VSB conceded that the blog posts were about former clients, contained information that was public, and would have been protected speech if disseminated by the news media or anyone other than Hunter.

The Supreme Court noted that it had been “called upon to answer whether the state may prohibit an attorney from discussing information about a client or former client that is not protected by attorney-client privilege without express consent from that client.”

The Court’s answer:  no.  Specifically,

• “To the extent that the information is aired in a public forum, privacy considerations must yield to First Amendment protections. In that respect, a lawyer is no more prohibited than any other citizen from reporting what transpired in the courtroom.”

The issue has gained some traction lately, largely in response to the ABA’s most recent formal advisory opinion.  Here’s an excerpt from a blog I posted last week.  It refers to criticism of the ABA’s opinion that “public record” is not necessarily “generally known.”

************************************************************************************

“On that point, the opinion is not without criticism.  Check out the post from Above The Law.   Among other things, the author, Robert Ambrogi, writes:

• “So a lawyer may not ‘reveal’ information that is contained in a public record. But how can someone reveal something that is already public? To reveal is to make something public that was secret.”

Interesting point.  I don’t necessarily disagree. However, on the flip side, what if you went through a messy divorce 10 years ago?

Imagine that it went to trial.  At trial, details emerged that remain embarrassing today.  Yes, the trial was public, but, really, in label only. Nobody went, certainly not the press.  The details are not, by any stretch of the imagination, generally known. The only way anyone could access the details would be by going to the great length of ordering a transcript.  Public? Yes.  Generally known? No.

How would you feel if your lawyer blogged the details tomorrow?”

************************************************************************************

Josh King is Chief Legal Officer at Avvo.  He commented on my post:

“Having hired lots of lawyers over the last 20+ years, of course I wouldn’t want them blabbing about my matters without my consent.

But there’s a difference between a best practice and what the law can prohibit. I’m quite sure that Rule 1.6 can’t constitutionally be applied to discipline a lawyer for stating something that is in the public record.”

Josh runs a blog called Socially Awkward.  He posted a much more detailed response there. You can read it here.

Keith Lee has a blog at Associate’s Mind.  In response to Josh’s post, Keith tweeted a quote from the Hunter decision:

 

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Michael Cicchini is a lawyer in Wisconsin.  In 2015, the Vermont Law Review published his article On The Absurdity Of Rule 1.9.  Here’s an excerpt:

“Rule 1.9 is an absurdly broad rule that perpetually bans attorney speech  for all purposes and with regard to all information, including information in the public domain. The rule has no rational, underlying policy, and is not even rooted in clients’ actual expectations regarding confidentiality . . . Instead, Rule 1.9 should be interpreted to permit an attorney to discuss, write about, or otherwise disclose publicly-available information relating to a former client’s case, provided the attorney does not contradict the former client’s position in that case.”

I don’t know that I have a position, mainly because I’ve never had to think about it.  I know that most bar counsel types believe in the idea that “public record” is not “generally known” and, therefore, is not an exception to the general prohibition against disclosure stated in Rules 1.6 & 1.9.  More practically, I simply believe that it’s a good idea not to talk about a former client’s matter, even if the matter received widespread media coverage.  Also, for lack of a better word, it makes me squeamish to think of a lawyer disclosing information about a former client that, while public, almost nobody else knows.

Still, I’m sensitive to the First Amendment argument. And, despite my personal opinion that one should take advantage of every single opportunity to keep one’s mouth shut, I feel like the pendulum has started to swing swung back towards the debate’s equilibrium.

So, what say you? I’m a piece of clay.  Mold me.  Again, here’s the scenario:

• You went through a messy divorce 10 years ago.  Mike represented you. The divorce went to trial.  At trial, details emerged that remain embarrassing today.  Yes, the trial was public, but, really, in label only. Nobody went, certainly not the press.  The details are not, by any stretch of the imagination, generally known. The only way anyone could access the details would be by going to the great length of ordering a transcript.  Public? Yes.  Generally known? No.  Yesterday, Mike blogged about them.

Should Mike be sanctioned? Discuss in the comment section, but keep it civil.  Or, take this poll.

 

 

 

 

ABA & Client Confidences: It’s Deja Vu All Over Again.

Last December, I blogged on ABA Formal Opinion 479.  It’s an advisory opinion in which the ABA’s Standing Committee on Ethics and Professional Responsibility stressed that lawyers should not assume that they are free to disclose client information merely because the information is in a public record.

That’s a point that I made in my post Hey Lawyers! STFU!

To bring you up to speed, here’s the analysis with respect to current and former clients:

Current Clients

• Rule 1.6(a) states that a lawyer “shall not reveal” information relating to the representation of a client unless (1) disclosure is impliedly necessary to carry out the representation; (2) the client consents to disclosure; or (3) one of the exceptions in paragraphs (b) & (c) is met.
• Notably, “it’s public record” is not one of the exceptions in paragraphs (b) & (c).

Former Clients

• Rule 1.9(c)(1) prohibits a lawyer from using information relating to the representation of a former client to the former client’s disadvantage unless the information is generally known.  The fact that something is public record does not mean that it is generally known.
• Rule 1.9(c)(2) states that a lawyer “shall not thereafter reveal” information relating to the representation of a former client except as the rules otherwise authorize or permit. Nothing in the rules authorizes a lawyer to reveal information merely because the information is in a public record.

On March 6, the ABA released advisory opinion 480.  The opinion purports to address the duty of confidentiality as it applies to lawyers who blog.  The ABA Journal and Above The Law reported on the opinion.   In addition, Trisha Rich and Allison Martin Rhodes, law partners at Holland & Knight, blogged on the opinion here.

The opinion strikes me as a bit odd.

First, for an opinion that purports to address lawyers who blog, it really doesn’t.  Indeed, parts of the opinion come off as, how shall I say it, “less than tech savvy.”  For example, the opinion refers to Twitter accounts as a “microblogs . . . that ‘followers’ (people who subscribe to a writer’s online musings) read.”

Twitter is more than a place to read online musings.  Per the Pew Research Center’s latest numbers, 24% of U.S. adults use Twitter, and 46% of those who do visit Twitter every day.  Speaking only for myself, Twitter is where I get my news. I don’t go for “musings.”  I doubt so many Americans do either.

Next, as Attorneys Rich and Rhodes point out,

• “The unusual thing about the latest opinion, though, is that it breaks very little new ground. The main point of the opinion is simply to reinforce to lawyers that their obligations of confidentiality always apply, even where a lawyer is communicating electronically.”

Indeed, the opinion makes me wonder why someone asked for it.  I mean, really.

As many of you know, whether by following this blog or attending my CLE presentations, I often urge lawyers not to fear tech.  Tech doesn’t require new rules. It’s simply a new forum in which the same old rules apply.  For example, many of the questions you should ask a potential cloud storage vendor are remarkably similar to the questions you’d want answered before renting a unit at the Store-All facility out on the Old County Road.

More specifically, would you have needed an advisory opinion to tell you not to reveal client confidences in op-ed pieces for your local paper? I doubt it.  Then why would you need an advisory opinion on whether it’s okay to reveal client confidences in a blog post?

Again, as Rules 1.6 and 1.9 make clear, unless one of the exceptions is met, IT IS NEVER OK TO REVEAL CLIENT CONFIDENCES.

Anyhow, the opinion isn’t entirely a restatement of the obvious. It includes a helpful tip on a pet peeve of mine.

At many of my seminars, lawyers pose “hypotheticals.”  Some are so detailed that I’d guess that half the audience knows who the lawyer is talking about.

Remember, “but I was at a CLE & said it was a ‘hypo’!” is not one of the exceptions listed in Rule 1.6.  Indeed, as the most recent ABA opinion reminds us:

• “A violation of Rule 1.6(a) is not avoided by describing public commentary as a
  ‘hypothetical’ if there is a reasonable likelihood that a third party may ascertain the identity or situation of the client from the facts set forth in the hypothetical. Hence, if a lawyer uses a hypothetical when offering public commentary, the hypothetical should be constructed so that there is no such likelihood.”

Finally, as I alluded to above, the opinion reinforces the notion that “it’s public record” is not license to reveal information. On that point, the opinion is not without criticism.  Check out the post from Above The Law.   Among other things, the author, Robert Ambrogi, writes:

• “So a lawyer may not ‘reveal’ information that is contained in a public record. But how can someone reveal something that is already public? To reveal is to make something public that was secret.”

Interesting point.  I don’t necessarily disagree. However, on the flip side, what if you went through a messy divorce 10 years ago?

Imagine that it went to trial.  At trial, details emerged that remain embarrassing today.  Yes, the trial was public, but, really, in label only. Nobody went, certainly not the press.  The details are not, by any stretch of the imagination, generally known. The only way anyone could access the details would be by going to the great length of ordering a transcript.  Public? Yes.  Generally known? No.

How would you feel if your lawyer blogged the details tomorrow?

In any event, from a practical standpoint, in law & life, I think it’s often best to heed the words of Thomas Edison:

“You will have many opportunities
to keep your mouth shut.
You should take advantage
of every one of them.”

 

Conflicts of Interest: keep it simple, trust your gut.

Conflicts are tough.

But not so tough that you shouldn’t trust your gut.

As most of you know, I provide lawyers with guidance on the Rules of Professional Conduct.   Over the past few years, I’ve averaged 1100 inquiries per year.  About 40% of those have been on conflicts of interest.

Inquiries on conflicts share one thing in common: lawyers almost always know the answer before they contact me.  Why?  Because if you feel the need to call me, text me, or e-mail me about a conflict, you probably have one.

Although my job is to know the rules inside & out, I don’t like getting lost in them. After all, they were written by lawyers.  I’ve been at this job for about 20 years.  To me, the rules are a perfect example of lawyers being lawyers and making the simple complicated.

It’s very simple.  As a lawyer, you owe duties to your client.  If any other duty or allegiance tugs you in a direction other than that which your client is headed, you might have a conflict. The “any other duty or allegiance” could be to another client, a former client, the court, a third person, or yourself.  The one that seems to arise most often: the duty to keep confidential any & all information relating to the representation of a former client.

I try to simply things.  Some of you think I’m overly simplistic.

Guilty as charged.

But, sometimes, simplification leads to realization.

Look back a few paragraphs. I used the word “tugs” for a reason.  The reason is because I think we’re all familiar with the game that, at least when I was a kid, was called “tug-o-war.”  As I blogged here, if you ever feel like the piece of red tape, you likely have a conflict.

Or, as those of you who were in Montreal know, if this picture reminds you of a tension you feel between duties to your client and duties to someone/something else, you probably have a conflict:

For those of you upset that this blog didn’t contain a link to, or quote from, a single rule or case, fine.  My next few posts on conflicts will be more lawyerly.

Or not.

For now, let’s keep it non-lawyerly simple: if ANYTHING ever tugs you, however slightly, in a different direction than that in which your client is headed, stop and consider whether you have a conflict. Then, if you think you do, trust your gut.

And, after that, call me.  I can count on less than one hand the number of times that I’ve said “no you don’t” when someone has called me to say “mike, I think I have a conflict.”

 

 

 

 

Hey Lawyers! STFU!!!

So, for those of you still adjusting to the interwebs, that headline is what we call “clickbait.”

And here you are.  Keepers, I hope.

But, seriously lawyers, shut up!

I’m talking about client confidences and the duty not to reveal “information relating to the representation” of a client.

The rule is Rule 1.6. For those of you averse to clicking on the hyperlink due to my repeated warnings about scams inviting you to do so, I applaud the effort, but frown upon your tech competence. Anyhow, here’s the language you need to remember:

• “A lawyer shall not reveal information relating to the representation of a client unless the client gives informed consent, the disclosure is impliedly authorized to carry out the representation, or the disclosure is required by paragraph (b) or is permitted by paragraph (c).”

Let’s look at it a bit differently.  Per the rule, a lawyer may “reveal information relating to the representation of a client” if:

• the client gives informed consent to disclosure; or,
• disclosure is impliedly authorized to carry out the representation; or,
• disclosure is required by paragraph (b); or,
• disclosure is permitted by paragraph (c).

Now, please click on this and review paragraphs (a), (b), and (c).  As you do, I want you to think of, and be prepared to tell me, the two things that you will raise as defenses to a disciplinary complaint and that I will tell you DO NOT APPEAR in either paragraph.

Are you ready?

Here they are:

1. But Mike, the information I revealed wasn’t privileged.
2. But Mike, the information I revealed is a matter of public record.

My responses:

1.  Did you read the rule? It says that you “shall not reveal information relating to the representation of a client unless the client gives informed consent [or] the disclosure is impliedly authorized to carry out the representation . . . ”  As made clear by Comment [3], the duty not to reveal “information relating to the representation” encompasses far more information than is covered by the attorney-client privilege. It encompasses “all information relating to the representation, whatever its source.” (emphasis added)
2. Where in paragraph (a), (b), or (c) does it say that a lawyer may reveal “information that is public record?”  Hint – you don’t need to go back and look.  The answer is “nowhere.”  In other words, “it’s public record” is not the same as:

• the client providing informed consent; or,
• information that is impliedly authorized to be revealed in order to carry out the representation; or,
• one of the disclosures mandated by paragraph (b); or,
• one of the disclosures permitted by paragraph (c),

Rather, it remains “information relating to the representation” that a lawyer “shall not reveal.”

Lawyers seem to get hung-up on the “public record” thing.  No need to get hung-up.  As I just said, the rule makes it very, very clear: “it’s public record” is not one of the exceptions to “a lawyer shall not reveal information relating to the representation.”

Of course, this almost never comes up with “current clients.” In my experience, lawyers seem to think that they can disclose information relating to the representation of a former client if the information is in the public record.

Nope.

Please look at Rule 1.9(c)(2).

Still click averse? Fine.

• “A lawyer who has formerly represented a client in a matter . . . shall not reveal information relating to the representation except as these rules would permit or require, or when the information has become generally known.”

The rules do not require or permit lawyer to reveal information merely because it has become a matter of public record.  Further, the fact that information is “public record” does not necessarily mean that it has become “generally known.”  There is plenty of authority for the proposition that “public record” does not equal “has become generally known.” I’ve listed a few cases at the end of this post.  For now, I’ll start with this:

Vermont’s Rule 1.6 is derived from ABA Model Rule 1.6.  The model rule expresses “the basic principle of professional ethics that all information `relating to’ a lawyer’s professional relationship with a client is presumptively confidential and must not be disclosed unless an exception applies.”  1 Hazard & Hodes, The Law of Lawyering (3d Ed.2001) 9-52, Section 9.15.

Or, think about it this way:

1. 25 years ago, you represented me in a divorce. The case went to a trial and the evidence, including my own testimony, established that I had an affair.
2. Now, in 2017, I’m running for public office, or, applying for a job and I listed you as a reference.  You tell a voter or my prospective employer “i’d never support someone who had an affair.”

Good luck with your “but it’s in the public record!” defense to my ethics complaint.

I’ve mellowed since I typed the headline.  So, I’ll conclude with this:

“Hey Lawyers! Be Quiet.”

But . . .

UPDATE – OCTOBER 5, 2017 

A few cites:

Most recently, take a look at, Dougherty v. Pepper Hamilton LLP, 133 A.3d  792 (2016), 2016 PA Super 23.  A thorough and relevant analysis begins on page 798. The court quotes the Restatement 3d, which includes the following language: “the fact that information has become known to some others does not deprive it of protection if it has not become generally known in the relevant sector of the public.”  Restatement (Third) of the Law Governing Lawyers § 59, cmt. d.

Akron Bar Ass’n v. Holder, 102 Ohio St. 3d 307 (2004). The case was decided under the Ohio rule that prohibited the disclosure of a client’s “confidendences & secrets.”  Some of you might remember that “confidences & secrets” are what we were required to keep confidential when Vermont followed the Code. We switched to the Rules in 1999.  In any event, after noting that its standard was “less encompassing than that in [ABA] Model Rule 1.6(a),” the Ohio court stated that “[t\here being an ethical duty to maintain client secrets available from sources other than the client, it follows that an attorney is not free to disclose embarrassing or harmful features of a client’s life just because they are documented in public records or the attorney learned of them in some other way.” 102 Ohio St. 3d (306, paragraphs 38-39). Again, the Ohio rule is encompasses less than the rule on which Vermont’s rule is based.

Here’s another: Lawyer Disciplinary Board v.McGraw, 461 S.E.2d 850 (W.Va. 1995).  The Moutaineer Supreme Court stated that “[t]he ethical duty of confidentiality is not nullified by the fact that the information is part of a public record or by the fact that someone else is privy to it.” Id. at 861-862.

Finally, I concede that the Restatement is not as restrictive as my take in the blog post.  Here’s more language from the Restatement:

• “Whether information is generally known depends on all circumstances relevant in obtaining the information. Information contained in books or records in public libraries, public-record depositaries such as government offices, or in publicly accessible electronic-data storage is generally known if the particular information is obtainable through publicly available indexes and similar methods of access. Information is not generally known when a person interested in knowing the information could obtain it only by means of special knowledge or substantial difficulty or expense. Special knowledge includes information about the whereabouts or identity of a person or other source from which the information can be acquired, if those facts are not themselves generally known.”

Still, as a lawyer, I’d be wary.  Arguably, “special knowledge” includes “I’m the only person who knows or remembers that there’s something in the public record about my former client.”

 

Changing Firms: Is our rule too strict?

Lawyers often change jobs, moving from one firm to another.  These so-called “lateral transfers” can raise concerns about conflicts-of-interest, particularly when the new firm represents a client with interests adverse to a client represented by the former firm.  Many lawyers assume that the new firm can simply “wall off”, or screen, the new lawyer.  Under our current rules, that is not an accurate assumption.

Caveat: this column applies only to transfers from private firm to private firm.  Transfers to an from government work, including agency to agency, are governed by Rule 1.11(d) and are a topic for another day.

Here in 2017 I present the scenario:

• Attorney works for New Firm
• Attorney used to work for Old Firm
• In the matter of Michael v. Corporate, Old Firm represents Michael and New Firm represents Corporate
• Does Attorney’s lateral transfer disqualify New Firm?

In my view, the answer is “it depends.”  I’ll go through 2 possibilities.

Possibility 1:  Attorney Participated Personally & Substantially in the Representation of Michael while working at Old Firm.

As I interpret the rules, if Attorney participated personally & substantially in the representation of Michael while at Old Firm, Attorney has a conflict that is imputed to New Firm, and that cannot be cured by screening Attorney.

Start with Rule 1.9.  Section(b) indicates that Attorney has a conflict. I don’t think there’s any doubt that Attorney is prohibited from switching sides and representing Corporate in the same matter in which Attorney used to represent Michael.

Now, go to Rule 1.10. It’s the rule on the imputation of conflicts. Rule 1.10 was amended in 2012.  Depending on which copy of the green book you have, the current rule might be in the pocket part. Or, the rule is HERE.

Attorney’s conflict is based on Rule 1.9(b).  Thus, Rule 1.10(a) imputes the conflict to New Firm, unless one of the exceptions applies.

The exception in Rule 1.10(a)(1) does not apply.  Attorney’s conflict is not personal. It is a former client conflict that arises under Rule 1.9.

The exception in Rule 1.10(a)(2) does not apply.  Rule 1.10(a)(2) allows New Firm to screen Attorney if:

1. Attorney’s prohibition is based on Rule 1.9(a) or (b); and
2. Arises out of Attorney’s association with a prior firm; and
3. In a matter in which Attorney “did NOT participate personally or substantially.”

Comment 7 hammers home the point: with lateral transfers, new firms can screen transfers, but only if the new lawyer is “one who ‘did not participate personally and substantially’ in the matter giving rise to the conflict.” (emphasis added).

In this version of the hypothetical, Attorney’s prohibition is:

• based on Rule 1.9(b); and
• arises out of Attorney’s association with a prior firm; and
• arises out of a matter in which Attorney participated personally & substantially

Thus, Rule 1.10(a) imputes Attorney’s conflict to New Firm and prohibits New Firm from screening Attorney.  Of course, New Firm would not be disqualified if Michael provided informed consent, confirmed in writing.  See, Rule 1.9(a).

Possibility 2:  Attorney did not Participate Personally & Substantially in the Representation of Michael while working at Old Firm.

If Attorney did not participate personally & substantially in the representation of Michael, then it appears permissible for New Firm to screen Attorney.

If Attorney did not participate in the representation of Michael, Attorney likely does not have a conflict under Rule 1.9(a).  Of course, it is possible that Attorney acquired information about Michael, even without participating in Michael’s representation. If so, Attorney is bound to protect the information, but Attorney has a conflict under Rule 1.9(b).

However, in this scenario, the third prong of Rule 1.10(a)(2) is not present.  Let’s look at each prong again:

• Rule 1.9(b) prohibits Attorney from representing Corporate; and
• the prohibition arises out Attorney’s association with a prior firm; BUT
• Attorney did not participate personally & substantially in the representation of Michael.

Therefore, Rule 1.10(a)(2) permits New Firm to screen Michael.  Subsections i, ii, and iii set out the specific screening procedures with which New Firm must comply.

ABA Model Rule 1.10 is not as strict as Vermont’s Version of Rule 1.10

In 2009, the ABA amended Model Rule 1.10(a)(2).  As amended, the Model Rule does not include the phrase “in a matter in which the disqualified lawyer did not participate personally and substantially.”  In other words, under the Model Rule, a new firm is permitted to screen a lateral transfer even if the new lawyer participated personally and substantially in the matter while at the old firm.

Question for Vermont

Should we follow the ABA’s lead and drop the ” participated personally & substantially” language?  That is, should we permit firms to screen new lawyers — no matter how substantial the lawyer’s involvement with a matter at a previous firm?

An argument for “no”:  the new lawyer has so much information that it would be patently unfair to allow new firm to remain in the case even if new lawyer is screened from participation.”

An argument for “yes”: Vermont is a small state with many potential conflicts.  We should not have a rule that restricts lawyers from leaving for new opportunities.

Go Cats Go!