Lawyer Intimidation of Opposite Parties in Legal Matters

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Lawyer Intimidation of Opposite Parties in Legal Matters Powered By Docstoc
					Legal Profession
Spring 2001

I.       Law Governing Lawyers – Sources & Enforcement
      A. General standard is AGENCY
          1. Client is Principal, Lawyer is Agent.
      B. Sources
          1. Canon of Professional Ethics – 1908
          2. Model Code – 1969
          3. Model Rules of Professional Conduct – 1983
          4. Ethics 2000 Commission - ??
          5. Federal Court's Ethics Rules
          6. Restatement of Law Governing Lawyers.
      C. Lawyer can get nailed form 3 different directions based on 3 different relationships
          1. Lawyer : Judicial System.
             a) RPC standards
             b) Disciplinary action from Bar
             c) Punishment usually relates to professional credentials, license.
          2. Lawyer: Client
             a) Standards can be RPC, or general law of tort, contract, malpractice. . . .?
             b) Malpractice
          3. Lawyer : 3d Party
             a) Generally Applicable Laws
             b) Fraud, Conspiracy etc.
      D. Enforcement of State Codes of Conduct are held by the Supreme Court of each state.
          They alone license lawyers. They alone can discipline under the codes. But the general
          laws are available in the courts via litigation.
     Increasing trend to sanction law firms
     Sup. Ct. – has to be SOME form of DUE PROCESS (Powell) before discipline
     Spevack – cannot be disciplined for invoking constl. right to protect yourself v. self
      incrimination (can’t be forced to testify); but – disc. auth. have right to draw negative
     When testify w/grant of immunity – committee CAN use against you, as basis for DQ, etc.,
      b/c NOT incrim. yourself

II.      General Law Governing Lawyers
      A. Rules
         1. RPC 1.2(d)-(e)
(d) A lawyer shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is criminal or
fraudulent, but a lawyer may discuss the legal consequences of any proposed course of conduct with a client and
may counsel or assist a client to make a good faith effort to determine the validity, scope, meaning or application of
the law.
(e) When a lawyer knows that a client expects assistance not permitted by the rules of professional conduct or other
law, the lawyer shall consult with the client regarding the relevant limitations on the lawyer's conduct.

         2. RPC 5.5
A lawyer shall not:
(a) practice law in a jurisdiction where doing so violates the regulation of the legal profession in that jurisdiction;
(b) assist a person who is not a member of the bar in the performance of activity that constitutes the unauthorized
practice of law.

         3. RPC 8.4(b)-(c)
It is professional misconduct for a lawyer to: . . . .
(b) commit a criminal act that reflects adversely on the lawyer's honesty, trustworthiness or fitness as a lawyer in
other respects;
(c) engage in conduct involving dishonesty, fraud, deceit or misrepresentation;

         4. RPC 8.5(a)
(a) Disciplinary Authority. A lawyer admitted to practice in this jurisdiction is subject to the disciplinary authority
of this jurisdiction, regardless of where the lawyer's conduct occurs. A lawyer may be subject to the disciplinary
authority of both this jurisdiction and another jurisdiction where the lawyer is admitted for the same conduct.

    B. Issues: When does a lawyer cross the line from advocate/representative to participant in a
       criminal act?
       1. Knowledge of Lawyer
       2. Misfeasance vs Nonfeasance giving liability
       3. Liability for doing job as "lawyer"
    C. Affirmative acts, and bad faith in the activity that is criminal will get you.
       1. Benjamin, and Nat'l Student Mkt – lawyers had knowledge that facts were wrong ina
           security disclosure. Continuing to give legal advice based on facts you know are
           fraudulent will expose you to liability.
       2. The fine line is determining when a lawyer knows versus suspects, and when the
           giving of legal advice (a lawyer activity) becomes a principal part of a crime of fraud,
           or other crime. Mens Rea and Actus Reus issues.
       3. Granewich – helping a client breach a known fiduciary duty may bring liability. Very
           dangerous. Remember who the client is – corporation. What kinds of majority v
           minority disputes are okay, dangerous?
           a) Advising client on breaching a K? Generally not liability.
           b) Where is the line? Reme
    D. Some Courts have even found a blind eye kind of liability
       1. Klein v Boyd.
       2. Lawyers didn't do anything in face of continuing client misfeasance.
       3. Lawyers responsible to investors they had never counseled, met, who didn't even
           know the lawyers existed.
       4. The question here is WHEN in the long course of advice did the lawyers have a duty
           to do something. When did liability attach to them.
    E. Rule 1.2 Hypo demonstrating levels of involvement with principal representing clear
       1. Money up front from client before going off to do bad, in order to secure
           a) Guilty of principal's crime
       2. Client going to bust up abortion clinic, pays you in advance
           a) Probably guilty, if you know their intent
   3. Client going to picket clinic, pays you in advance
       a) HARD – question of "furthering" crime.
   4. Going to picket, comes for advice on what is legal, pays in advance incase any thing
       goes wrong.
       a) Okay. Typical lawyering.
F. Hypo – Sr Ptr representing X in securities fraud, going badly, going to lose. Asks jr ptr
   to do research for case on extradition laws with other countries, how to avoid it.
   1. You know or suspect why  guilty. furthering.
   2. Ignorant, totally. Fragmented firm. Likely okay.
   3. What to do?
       a) Talk to partner
       b) Go to committee
       c) Ultimately don't do it.
G. Multijurisdictional Practice – Unauthorized practice of law.
   1. Birbrower.
   2. States require individual licensing to insure competent representation within their
       control. Thus, Birbrower looks extreme – sophisticated client chose NY firm with
       which it had previous relationship.
   3. Enforcement –
       a) discipline by state in which practicing, or home state
       b) refusal to enforce fee collection for work performed.
H. Cases:
   1. Benjamin (62)
       a) Lawyer rendering opinions, brought brokers and acct's together
       b) Knew facts weren't true.
       c) Convicted as accomplice to principal criminal act
   2. National Student Marketing (104)
       a) Again, opinion letters regarding securities transactions
       b) Closing day, acct's "comfort letter" indicates some discrepancy in figures used in
           proxy to S/H's and relied upon in voting on txn.
       c) Atty responsibility required doing something about figures: advise corp., get
           revealed to SHs, delay closing.
       d) Silence in face of closing was material in accomplice liability for the principal's
   3. Klein (289)
       a) Atty helping formation of LP
       b) Atty knows S/H's not told about investments, gives repeated advice counsel to
           disclose and give SHs chance to rescind. Atty learns of head dude's SEC
           violations in past, continues to advise disclosure.
       c) Finally, Atty learns no intent to disclose ever. Does nothing.
           1) Blind eye in face of duty to act
       d) Even though SHs didn't know him, not a "party," he is liable.
   4. Granewich (Supp1)
       a) Attorney sued for helping majority SH's oust a minority SH. Dangerously broad.
           Client is corporation, so can a lawyer claim to be acting in best interest of
           corporation, or is any maj v min action leave him liable.
            b) Only real liability can be aiding a breach of fiduciary duty on part of maj SHs
         5. Birbrower (1056)
            a) NY firm, with NY client that eventually opened a CA branch. Firm represented
               CA branch in CA deals with CA parties, though not licensed in CA.
            b) Found liable for unauthorized practice. No legal advice, preparing K's or other
               legal instruments without CA licensing.
            c) Exceptions – brief appearances, pro hac vice.

III.     Competence, Diligence, Communication, Zeal
    A. Rules
       1. RPC 1.1
A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge,
skill, thoroughness and preparation reasonably necessary for the representation.

         2. RPC 1.3
A lawyer shall act with reasonable diligence and promptness in representing a client.

         3. RPC 1.4
(a) A lawyer shall keep a client reasonably informed about the status of a matter and promptly comply with
reasonable requests for information.
(b) A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed
decisions regarding the representation.

    B. Competence
       1. Just like the rule says. BUT, you can take on representation you are not competent to
          handle if you can become competent. For example, a novice can take on work, and is
          presumed to be able to learn. So long as it doesn't create undue delay or cost to
          a) Lawyer must evaluate – can he learn, or must he disclose incompetence and not
          b) If it is a learning thing, can take. If the business itself would take time to pierce,
              like a small, clique-ish area of practice, then disclose and not represent.
       2. Strickland v Washington
          a) Counsel for indigent murder defendant accused of ineffective counsel, seeking
              overturn death sentence. Atty's sentencing stage sought sympathy, not to
              investigate potentially damaging info. Court won't overturn
          b) To overturn death sentence
              1) Deficiency – errors so serious that counsel is not functioning as counsel
              2) Prejudice – but for deficiency reasonably probable that result different.
          c) Q? How do you know what is damaging without investigating.
              1) Raises a diligence issue!!
    C. Communication
       1. Must communicate on all significant matters. Remember, it is the client's case, not
       2. Must explain such that client can understand and make an informed decision.
       3. Hypo
        a) Client getting worn down by scorched earth tactics of opponent. Opponent makes
            insultingly low offer  you fear she may take out of desperation.
        b) Do you present it? Or refuse out of hand?
        c) Must present. It is her case.
  D. Zeal – be dedicated. Now not so much an issue
     1. Now it is more about going too far. Witness coaching.
        a) Can use any truthful evidence, can seek to discredit testimony.
        b) But can you seek to create inferences that something known false is true?
        c) Can you seek to create inferences that something known true is false?
     2. Courts struggle with certain issues of intimidation, smearing of witnesses by lawyers.
        Fine line between discrediting and destroying.

IV.   Confidentiality
  A. Rules
     1. RPC 1.2(d)
     2. RPC 1.6
     3. RPC 1.8(b)
     4. RPC 1.9(c)
     5. RPC 3.3
  B. The lawyer has a duty to keep confidences. Part of the loyalty/confidentialiry duo. Not
     to be confused with the Evidentiary Attorney Client Privilege.
     1. Communications between attorney and client regarding legal advice
         a) No 3d party present
         b) For purpose of obtaining legal advice
         c) Can be waived by client – can also be waived involuntarily by conduct of lawyer
             or client  telling 3d party
     2. Doesn't cover the facts to which the communication relates, or physical evidence
     3. If you fail the evidentiary test, a court can compel you to reveal confidences that the
         rules protect  the Rules do not trump an official court ruling.
  C. What information is Protected?
     1. Model Rules provide more sweeping coverage than the A/C privilege.
     2. Rule 1.6 protects all information related to the representation of the client. This
         also applies to prospective clients.
  D. What Duty is imposed upon that information
     1. Duty of non-Disclosure –
         a) Current Client: No disclosure, absent an exception (1.6, with exceptions).
         b) Former Client: Even after relationship has ended, no disclosure absent listed
             exceptions (1.9(c)(2)). 1.6 and 3.3 give exceptions.
     2. Duty of non-Use –
         a) Current Client: Slightly looser, no use to disadvantage of client (1.8b)
         b) Former Client: And with former client, no use unless info has entered public
             domain (generally known) (1.9(c)(1)).
     3. General Laws of agency prohibit agent from profiting (at expense of principal?) by
         principal's info.
  E. Why have this –
   1. Encourage client confidences
   2. Zeal – good representation means not giving keys to kingdom to opponent.
F. Exceptions to duty of confidentiality.
   1. Client Consent
      a) Express, informed (after consultation) consent to disclosure will do.
          1) Raises factual question as to what constitutes informed.
          2) Fentress: friend calls atty to tell of murder. A advises calling police, F agrees.
              While the corpus of the crime is privileged, there was intent to allow police to
      b) Implied – 1.6: disclosures impliedly authorized in order to carry out
          1) Communications between lawyers within the firm representing (comment 8)
          2) Admitting facts that cannot properly be disputed (?) (comment 7)
          3) Use of information in negotiations with opponents to reach satisfactory
   2. Client Wrongdoing
      a) LUNING'S favorite area for hypos. Most difficult area to parse, likely exam Q.
          1) Model Rule 1.6(b) says a lawyer "MAY" reveal such info "to the extent the
              lawyer reasonably believes necessary" to prevent client criminal conduct that
              the lawyer believes is "likely" to result in "imminent death or substantial
              bodily harm."
      b) Note – optional to do altogether.
          1) Only if his belief of necessity is "reasonable."
          2) Belief of likely harm is purely subjective, need not be reasonable at all.
      c) Further Note –
          1) No after the fact reporting
          2) With exception for "ongoing crimes" – where does this come from.
      d) Interaction with 1.2(d) –
          1) Cannot assit a client in conduct you know is criminal. Can reveal prospectie
              criminal conduct.
          2) If you learn of past criminality, no 1.2(d) violation – didn't assist past conduct.
          3) Can'treveal under 1.6, no future crime postulated – opportunity to counsel on
              future actions.
   3. Legal Compulsion – judicial body may compel you to reveal confidences.
      a) You should object, try to block, claim privilege. Questionable if it is a violation to
          choose NOT to do so.
      b) But under subpoena, court order, if no privilege, you do not have to suffer a
          contempt citation before revealing.
      c) Sometimes, outside bodies of law can compel certain disclosures –
          1) Tarasoff: tort law, harm to others.
          2) Securities cases seemed to nail lawyers at times for going along with things
              they knew weren't kosher. May not have had to disclose.
   4. Legitimate Self Interest
      a) To collect a fee
          1) SHouldn't blackmail, but can reveal in a suit against client.
          2) Should be narrowly construed.
      b) To respond to a charge of wrongdoing. 1.6(b)(2)
           1) Any defense in a civil / criminal claim surrounding representation of client
           2) Or to respond in any venue to charge of wrongdoing. Disciplinary committee,
               allegations of 3d party. Need not be a formal proceeding.
G. Former Client – Specific Duties
   1. Atty/Client Privilege
      a) Unchanged – even at death of client
   2. Confidentiality
      a) Reveal/Disclose
           1) RPC 1.9(c)(2) – Not allowed except within exceptions of 1.6 and 3.3
      b) Use
           1) RPC 1.9(c)(1) – No usage, unless info generally known/in public domain.
H. Duties to Avoid Fraud and Misrepresentation – interaction with confidentiality.
   1. Lawyer has a duty to not make a "false statement of material fact or law" to a 3d party
      (RPC 4.1(a)) or a tribunal (3.3(a)(1)).
      a) Difficulty – when is NON-disclosure such misfeasance?
           1) Partial omissions – once you begin to speak, must be sufficiently truthful and
               complete not to mislead.
           2) Non-disclosure in the face of known misunderstanding.
               (A) Say opponent labors under a misunderstanding of fact.
               (B) If misapprehension is NOT your fault, NOT caused by your actions or
                   client's  then you are okay. Similar to witness coaching example in
                   (1) no obligation to tell prosecution that it has murder time wrong, no
                       problem with putting up witness you know is guilty who can truthfully
                       tell where he was at the mistaken time of murder.
      b) If third party misunderstanding is caused by you or client, analyze under
           "assisting client fraud" of 1.2, and disclosure under 1.6.
           1) Disclosure – 3.3(a)(2) and 4.1(b) assert an affirmative duty upon the lawyer to
               not "knowingly" fail to disclose in these situations. Therefore, MUST
               disclose. . .
               (A) 3.3 puts the duty to the tribunal ABOVE the 1.6 client duty.
               (B) 4.1 SUBORDINATES this duty to the 1.6 client duty.
           2) Withdrawal – What then does a lawyer that cannot disclose, but cannot
               knowingly assist in client fraud? Withdraw.
               (A) RPC 1.16(a)(1) – lawyer SHALL withdraw if the representation will result
                   in a violation of RPC or law! Note, the comments give a lawyer the
                   opportunity to counsel a client to not take the course of action proposed
                   before withdrawing.
               (B) Comment 15 allows a noisy withdrawal, where lawyer can disavow any
                   opinion that it has issued – thus if the damage has been done, and simple
                   withdrawal won't prevent "assisting" the fraud, the lawyer can take
                   additional steps to prevent the crime from happening.
                   (1) If the damage is REALLY done, and the crime is complete, the lawyer
                       may NOT withdraw noisily. There is no more assisting to be done
                   (2) But lawyer is okay, as the assistance wasn't KNOWING.
    I. Cases
        1. Fla Bar Ethic Opinion 95-4
           a) Atty counseled both hubby and wife on wills
           b) Hubby wants to keep something from wife
           c) Atty must withdraw – cannot tell wife, cannot continue to rep wife and hubby
               with conflict.
               1) Some states – NJ, Atty must reveal to prevent fraud on wife.
           d) Q as to whether RPC 1.4(b) on communication would require a thorough
               conversation about potential pitfalls and what would result during the pre-rep
               1) RPC 1.7(b)(2) – joint representation – requires consultation to include a
                   conversation like above.
        2. OPM
           a) Fraudulent computer leasing. Facts became known to Singer Hutner lawyers only
           b) Rules possible -
               1) RPC 1.2(d) lawyer cannot assist a client in conduct lawyer knows is criminal
                   or fraudulent
               2) RPC 1.6 when can you reveal/disclose  no exception to prevent or rectify
                   fraud, only the great bodily harm/death stuff.
               3) RPC 1.16 (a) - When can you/must you withdraw from representing a client –
                   req. w/drawal if rep. result in viol. RPC or other law (b) (1) MAY w/draw if
                   w/o material adverse effects on client (here Morty worried – signal to
               4) 1.16 (b)(2) may also w/draw if client persists in course of action using your
                   services – criminal/fraudulent, (b) (3) if client HAS used lawyer’s services to
                   perpetrate crime/fraud
               5) RPC 4.1 (a) lawyer has to be truthful when speaking to 3rd persons; (b) must
                   disclose material fact avoid assisting crim./fraud. Act by client unless
                   disclosure prohibited by RPC 1.6
           c) idea of knowing as much as you can about client’s business, etc. – good idea – but
               no obligation; concern about whether you are participating in a fraud
           d) discovered Myron had been kiting checks… no Q of reporting – already out there;
               didn’t use lawyer’s services – no basis for mandatory withdrawal (1.16(b)(2));
               MAY NOT w/draw b/c only permissible if client persists… and climes not going
               to do it anymore and your services not used
           e) clear that fraudulent activ. in past and involved their services;
               1) Disclosure NOT permitted;
               2) No mandatory w/drawal – if all in past
               3) precarious position w/permissive w/drawal – b/c loyalty/oblig. – and w/drawal
                   would harm
   amended comments to allow ―NOISY‖ w/drawal (comment 15 to 1.6) – can w/draw opinions
    from financial inst. – backhanded way of avoiding saying you can actually disclose
   ***MUST w/draw if your services are going to be used in an ongoing fraud
   1) when rep’ing a client, don’t let yourself be incrementalized to death 2) don’t ever trust
    anyone else to do your due diligence 3) learn about your client’s business in broad sense
    it was prudent thing to do to go to experts – evid. of consulting prob. helpful
    ―HONESTY OF THE COURT‖ exception – RPC 3.3 – litigation conduct – where advocacy
     involved – lawyer cannot put on testimony knows to be false (3.3(a)(4)); 3.3(b) can’t falsify
     evid.; cannot so encourage client; 3.3(c) if reasonable believe false – can refuse to put in;
     3.3(a)(4) if later come to find evid. false – must take reasonable remedial measures
    reflects special dual obligation of lawyer – client is central – but also obligation to system

        3. Nix v. Whiteside (US 1986)
           a) client says going to testify saw something metallic – lawyer considers potential
              perjury (never saw gun)
           b) 5-4  obligation of lawyer to CT. trumps oblig. to client
           c) NOT ineffective assistance of counsel for lawyer to refuse to present perjured
              testimony – no prejudice there b/c no RIGHT to present perjured testimony
           d) Have to weigh and recognize obligation
           e) When unable to dissuade client from lying – can w/draw (unless in trial, etc.);
              where can’t w/draw – can put client on stand to give narrative testimony – can’t
              argue that testimony in closing, etc.

V.      Identification of Client; Loyalty
     A. Rules
        1. RPC 1.2(a)–(b)
        2. RPC 1.7
        3. RPC 1.8(f)
        4. RPC 1.13
        5. RPC 5.4(c)
        6. RPC 6.4
     B. Loyalty
        1. Agency Law rules
           a) Cannot harm principal
           b) Cannot profit at expense of principal
           c) Obliged to advance principal's interests
        2. RPC Rules
           a) 1.16(b)—allows withdrawal only if it doesn't materially harm the client; or under
               specific instances of client misconduct. Cannot just withdraw when you want to
               if it will harm client.
           b) 1.2(a)—must "abide" by client's decisions concerning the representation.
               1) But not an endorsement of client's views (1.2b)
           c) 1.8(f)—can only accept compensation from client being represented, barring
               certain circumstances
               1) 5.4(c)—even if client's bill paid by 3d party, 3d party cannot "direct or
                    regulate the lawyer's professional judgment."
           d) Exceptions: 6.3 & 6.4 allow membership in professional organizations that might
               take positions adverse to client. Note, thought, 6.3 prohibits participation in a
               specific decision that materially affects or is inconsistent with representation.
      e) NOTE – the really big loyalty issues come with concurrent or successive
           representations of clients in conflict. That is rule 1.7. This section is more about
           generic loyalty to client, and who that client is.
C. Identification of Client
   1. Duty of loyalty, however, requires that you identify who exactly is your real client!
      a) Hypo: 3 professors want to form biz and market law classes on the Internet.
           1) Who is your client?
           2) Could be any one of the professors
           3) Could be the entity itself.
           4) Your loyalty to the unidentified client governs actions.
      b) Solution, make clear up front who is your client. But effects may be unclear
           perhaps all want own lawyer, clogs up easy deal.
   2. Many times, the entity itself is the client, but that is unclear to the employee of the
      entity seeking your counsel
      a) RPC 1.13(b)—organization more important than employees. If employee acting
           such that they harm organization, or cause org to violate law, lawyer has duty to
           act in best interests of ORGANIZATION.
           1) minimize disruption and revelation of info, but
           2) still take actions—ask reconsideration, go over employee's head.
      b) 1.13(c)—if it is to no avail, can resign under 1.16
      c) When dealing with employees, explain entity is the client "when it is apparent"
           that corp/ind interests are in conflict.
      d) BUT, can do multiple representation of employees under RPC 1.7
           1) 1.7(a)—no representation if directly adverse unless "reasonably believe" won't
               "adversely affect the relationship" with first client; or consultation. 1.7(b)—
               no representation if "may be materially limited" by responsibilities to other
               client or 3d party unless same beliefs noted in (a).
   3. Representing Partnerships
      a) Depends on whether state law treats the partnership as an aggregate of individuals
           or as a separate entity.
      b) Even if an entity, must take care to avoid partners who think there is individual
           representation. 1.13
   4. Representing Corporations
      a) Take care, as noted in Sprint Case, of relationships of divisions or subsidiaries.
      b) Even if there is no conflict, may screw yourself by hurting relationship.
D. Meehan v Hopps (709)
   1. Did law firm with corp as client previously represent a director? If so, conflict, as
      now corp trying to pin liability on individual?
   2. NO – actions were as lawyer for corp with ancillary relations with director as
      corporate employee.
   3. Need something EXTRA for it to be individual representation.
   4. Like in EF Hutton;
      a) Entered formal appearances before SEC as individual counsel for director's SEC
      b) Found to have represented individual despite no fee payment, and no formal
           request for individual representation.
  E. In re Carter and Johnson (SEC 1981)
     1. cited often in cases of recalcitrant client – refusal to act
     2. C&J lawyers for co.; co. made misleading disclosures; C&J said clean up – client
         didn’t; C&J prosec. for aiding & abetting
     3. 1st try to change clients mind, approach bd. dir., resignation… SOME prompt action
         is necessary – RPC 1.13 adopted C&J as rule.
     4. Don't resign without some action first!
     5. Q of whether there’s a conflict depends on how define client
  F. Donnelley v. Sprint Publishing & Adv., Inc. (USDC NDIL 1996)
     1. Atty rep'd Sprint sub-sub in transactionals, rep'd D in litigation against Sprint sub
         (SP&A). Is this a conflict? Is this even multiple representation.
     2. NO. Court finds separate corporate identities, no identity of directors or general
         counsel. So not identical corp, not even same client to Atty.
     3. ***This case was a departure, corp family traditionally considered a single entity—
         BUT a growing and respected decision – endorsed by ABA – you don’t necessarily
         rep. all members of corp. family when rep. one
     4. BUT AGAIN ***must look at all factors (1) ―alter ego‖ test – factors of ID of co. (2)
         extent of overlap of dirs. (3) extent of overlap of officers
     5. EFFECT OF DONNELLY on partnership analysis?
         a) ID of client imp. in partnerships – liability issues (shared? limited?)
         b) Cases go all ways – recognize issue and analyze in terms of loyalty issues
         c) Discuss at outset – clearly ID who client is – who you are rep’ing and put it in
         d) Example of ACLU & street musicians – city offers $ settlement, ACLU wants
             verdict… make clear at outset who client is
         e) Rights and obligations often written into insurance policies (ex. of car insurance –
  G. Lincoln Savings, Kaye Scholar, and Drug Co hypo:
     1. Atty knows actions of Corp directors are illegal, and involve federal regulatory
         authorities – FDIC or FDA. Some semblance of fiduciary duty to public via
         regulatory agency.
     2. 1.13 duty to do something within corp., go to higher authority.
     3. 1.13/1.16 duty to withdraw if highest authority flouting laws.
     4. Continuing to provide counsel in spite of knowing=aiding and abetting.
     5. Rule 3.3(a) duty requires candor to tribunals in spite of violating confidences. And it
         need not be an adjuticative tribunal (Kaye Scholar). So possible duty to reveal

VI.   Conflicts
  A. Concurrent Representation
     1. Rules
        a) RPC 1.7 is the biggie
        b) 1.8(g)
        c) 6.3
     2. Basically 1.7 sets plate – cannot represent a client if the representation will hurt
        representation of another client or be hurt by representation of another client.
     a) The issue is one of LOYALTY
         1) cannot be directly adverse to another client. 1.7(a)
         2) cannot be materially limited by representation of another client or
             responsibilities to lawyer's self or third party. 1.7(b)
     b) Generally, check materially limited on new client first, then check direct adversity
         to an old client.
         1) If you find 1.7(a) problem, start with consent from old client first?
         2) Meshes with consultation these checks usually occur before/during
             engagement talks with new client. See ABA Opinion 90-358 below. Goal is
             to find out as little as possible about new client while getting necessary info to
             check conflicts.
     c) Consider Sophistication of clients
     d) nature of representation
     e) individual v. entity?
3.   Out of the Question examples – manifest conflicts
     a) Representing Both Sides in Litigation
     b) Representing both sides in negotiations
         1) Fudge room – RPC 1.7 Comment 12 says not allowed when positions are
             "fundamentally antagonistic."
         2) But if clients are "generally aligned" then you CAN represent both even if
             there are "some difference of interest" between them.
         3) PLUS, some intermediation possibilities.
     c) Suing one's own client (matter unrelated to representation, obviously)
         1) Issue of direct adversity.
4.   Gray Areas – inchoate conflicts where multiple clients have generally aligned
     interests, for the moment.
     a) Representing Co-defendants or co-plaintiffs
         1) Chance that aligned interests will diverge
         2) Chance for material limitation of representation.
         3) Requires serious advance work, explanations
         4) May result in withdrawal.
     b) Joint Estate planning
     c) Representing principals in setting up a business.
5.   Indirect Conflicts
     a) Positional Conflicts
         1) Lawyer takes a position in one case that, if successful, will adversely affect
             the litigation posture of another client in an unrelated matter.
         2) RPC 1.7 Comment 9 notes that such things are generally okay, especially in
             different cases in different veues at different times.
             (A) Same venue same time may be improper
             (B) Especially if it will have a materially adverse effect on one client.
6.   Consent as cure for conflict
     a) 1.7(a) and (b) allows consent to be sought, BUT ONLY if first pass test of
         reasonable belief of no adverse effect.
     b) So first, must have belief, then must seek informed consent after consultation.
    c) Raises issues of confidentiality—obtaining informed consent requires divulging
       confidential information, involving a multi-stage process of getting consent to
       disclose under 1.6(a) from X to talk to Y, then talking to Y, disclosing, and
       getting consent to be adverse under 1.7 and reciprocal disclosure consent under
       1.6 to go back to X and ask for consent to adverse representation.
    d) Some situations, obviously, are directly adverse and cannot be reasonably
       believed to not adversely affect the relationship with the other.
       1) Such as situations above – suing former client.
    e) Advance waivers are a part of engagement letters, and often give all consent to all
       conflicts that are consentable.
       1) But not sufficient in lots of cases
       2) With time and unanticipateable situations, not effective.
       3) See Worldspan- advance waiver insufficient for directly adverse litigation
           against a current client!
7. Withdrawal as cure for conflict.
    a) Withdrawal is tricky because any withdrawal for conflict inevitably creates a
       current/former client situation.
    b) May ultimately result in withdrawing from ALL represenetations on both sides of
       the conflict.
8. Care as a solution for conflict
    a) Best solution is to do good conflict checks in advance, don't accept questionable
       multiple representations, and discuss discuss discuss ahead of time to make sure
       everyone knows of potential conflicts and deals with outcomes in advance.
9. Cuyler v. Sullivan (US 1980)
    a) Multiple rep. in criminal case not a per se violation of 6th Am. – but RARE to see
       one lawyer rep. multiple criminal Ds b/c interests are so potentially diverse
    b) Showing of prejudice not necess. if you show an actual conflict that adversely
       affects lawyer performance – that’s enough to show ineffective assistance of
       counsel – not full zeal
    c) Possib. of conflict – b/c may have rested defense too soon – not want to expose
       other witnesses who might later testify for other Ds
    d) Remanded – later found to be a conflict
10. GATX/Airlog Co. v. Evergreen Int’l Airlines (USDC NDCA 1998)
    a) end result – judge DQs MBP
    b) when does MBP become adverse to BoNY? Lawsuit not filed until 1/30/98 – but
       MBP didn’t appear for BoNY; according to ct. – the moment it starts making
       arguments against Evergreen – b/c same defenses used v. both – but MBP didn’t
       know anything about it at that point
       1) in 5/97 – MPB learns of BoNY’s interest – of claim – extraordinary that judge
           suggest at earlier pt.
       2) direct adversity? Y and N – not directly ―across the table‖ – material
           limitation situation? Whose consent is needed, then.
       3) ***BoNY did NOT have responsibility to reveal conflict – ALWAYS
           LAWYER’S BURDEN unless evidence of BAD faith on behalf of client
       4) And note, BNY not former client – ongoing unless expressly unambiguously
           dropped. –Salomon.
    c) judge – ―hot potato‖ rule – can’t drop one client like hot potato to rep. better
       1) fair to GATX? (to DQ MBP)
       2) Luning disagrees w/result in this case
       3) Law firm sought consent – then later argued no longer client – another ―nail‖
           in coffin
    d) Judge – high moral tone about what a lawyer ought to do (as opposed to SWS
       case) – tone underscores quality of AC priv. – Luning applauds
11. SWS Financial Fund v. Salomon Bros. (1992 NDIL)
    a) Basic premise – law firm cannot sue – be adverse to a current client (1.7(a)) – w/o
       consent & When does a current client become a former client.
    b) ***Was Salomon Bros. a current client? No express end to relationship;
       presumption of continuance of relationship unless termination is clear, express,
       and specific.
    c) killer – Aug. 13, 1991 lawyer called Sal. Bros. and asked for consent
    d) 1st – decide whether need consent, b/c once you ask – difficult to go back
    e) here – found conflict – but didn’t DQ – fairly novel – judge really good here –
       look at fact that matters totally unrelated – practical impact – not in rules
    f) ***look at practical implication on relationship w/client long term – whether –
       while permitted to get consent – it’s something you really want to do
12. WorldSpan, L.P. v. Sabre Group Holdings, Inc. (USDC NDGA 1998)
    a) Local counsel for Ds had rep’d P in state tax matters – here – TOTALLY
       DIFFERENT issues – had gotten ―advance waiver‖ from P in engagement letter
    b) Ct. said consent no good: (1) was 6 yrs. ago – lots happened in meantime,
       therefore not informed consent; (2) consent didn’t mention litigation – not
       specific to litigation – must use word litigation
       1) Future directly adverse litigation is so extreme that it is hard to consent it
           away in advance.
    c) ***should have been more factually explicit
13. ABA Opinion 90-358
    a) did everything right – conflict search – discovered conflict – turned down
       business, but could still be a problem… from info got at outset; ***prob. b/c
       relationship starts before agree to rep.; obligations arise out of pre-screening –
       interview constitutes confidential client communication;
       1) The information you get from a consultation is PROTECTED like they were
           client, even if you refuse representation.
    b) how avoid being DQ’d?
       1) could get a waiver from party coming in for consultation… but prospective
           client prob. not like that very much
       2) get minimum amt. info to conduct conflict search – nature of matter, names of
           parties, whether adverse, etc. – sometimes even that little amt. of info can DQ
           atty. – prospect that client may be there for ulterior motive – w/aim of DQ’ing
       3) why is there a problem? Possib. of inhibition on/in rep. of current client (if get
           juicy info can’t use…), strategy info – amt. other side willing to settle for, stat.
           limitations, etc.
       c) RPC 1.10 rule of imputation – if one lawyer of firm DQ’d – so is whole firm; can
          always rely on consent – despite conflict – but major hurdle – informed consent
          (must tell each something about the other)
          1) can easily be put in position where can’t get consent b/c you can’t say enough
       d) Some hypos outcomes from Case
          1) Info obtained is protected, and even though representation is turned down that
             info cannot be used with existing client to disadvantage of prospective client.
          2) Even if info could be advantageous to existing client and harm prospective
             client, if care was taken likely no DQ? Seems odd.
             (A) Takeover defense stuff – knows D wants to takeover; cannot use info in
                 representing C, but not DQ'd? If info can be generally known or deduced,
                 THEN can use it? 1.9 use allowance?
             (B) BUT, in Real Estate Purchase, notes that even knowing of competitor may
                 create 1.7(b) material limitation in representing current client. And may
                 have to withdraw.

B. Successive Representation
   1. Rules
      a) RPC 1.9
      b) Cannot accept representation that is materially adverse to the interests of a
          former client when matter is same or substantially related to prior
          representations subject matter unless client consents.. 1.9(a)
          1) 1.9 Comment 2 discusses the substantial relationship test. Highly fact
              dependent. Obviously, on same transaction is substantially related. But just
              because it is same type of transaction as one you have done prior doesn't make
              a wholly distinct transaction substantially related.
          2) Materially adverse is obviously not directly adverse – is a broader category
              of adversity.
          3) Consent dooesn't have to be reasonable?
      c) Even the acceptableness of representation doesn't change the confidentiality
          requirements of 1.6 1.9(c)
          1) No use unless generally known information
          2) No disclosure except under 1.6, 3.3 exceptions.
   2. Issue is one of CONFIDENTIALITY. What is reasonable for the former client to
      expect from lawyer after representation is over. When is representation actually
      a) Schwartz  emphasis on substantially related test shows it is about not
          using/disclosing previously acquired confidences, and not about loyalty
   3. Means of testing
      a) Current and Former client? Requires determining WHO client is and was
          1) Same stuff as before
          2) Schwartz: Representing X's guardian (G) in matter regarding land being
              managed in name of X .
              (A) Yes, X is a former client.
      b) Same or Substantially Related Matter
           1) Schwartz – court must make a factual reconstruction of scope of prior
               representation and determine whether it is reasonable to infer that confidential
               information would have been given to lawyer then, and whether that
               information would be relevant to issues in the current litigation.
           2) Appearance of impropriety is a dead test
           3) Note – it is generally not possible to rebut court's finding of "substantially
               related." Would have to reveal confidential info, which defeats purpose of
      c) Materially Adverse to former client.
   4. If attorney feels there is no 1.9 violation, should he get consent? Hell no. prima facie
      showing of conflict –
      a) MBP firm in GATX fucked itself by doing exactly such a think with concurrent
      b) Good Biz to talk to new client about possible conflict though – not a legal
           requirement, certainly.
   5. Cases
      a) Schwartz
      b) Brennan’s, Inc. v. Brennan’s Restaurants, Inc. (5th Cir. 1979)
           1) Family biz, Wegman had rep’d only family – split – rift divides into two
               groups. W sticks with one in dispute, other seeks DQ
           2) Clearly meets all test – former & current client, substantially related matter,
               and materially adverse.
           3) But no confidences at issue here—both sides know everything about the other
               and everything the atty knows. They were same entity previously.
           4) But loyalty remains an issue. And, cannot attack own work product, so ability
               to represent is affected.
           5) Case shows that there is SOME loyalty component to the successive rep stuff.
           6) Despite fact no confidential info at stake, generally, once lawyer has rep’d
               multiple parties – can’t rep. one v. other – EXCEPT – Alegert (?) rule –
               everyone knew lawyer really lawyer for principal client and secondary client
               got free ride – so not going to DQ – no confid. at stake; loyalty owed to
               primary client

C. Imputation; What Lawyers Affected
   1. Rules RPC 1.8(i), 1.9(b, c), 1.10, 1.11, 1.12
   2. Imputation is about determining when the conflict of one lawyer stains another
      a) FIRST, need to show that lawyer A is in conflict, actions are limited. If the
          primary lawyer is not in conflict, there is no further analysis.
      b) SECOND, need to do imputation analysis on a second lawyer to see if the stain
          has spread to him.
   3. Three levels of imputation analysis
      a) Members of an existing firm
      b) Lawyer who has left a firm
      c) Among a firm FROM a lawyer who has left a firm.
      d) Afterwards, ask whether consent received. All imputation cured by consent.
4. Existing Firm. 1.10(a)
   a) RPC 1.10—no one in an existing firm can knowingly represent a client when
      ANYONE else in the firm would be unable to do so under 1.7, 1.8(c), 1.9, or 2.2
      1) 1.7 – general conflict rules, concurrent, multiple client rules, 3d party
      2) 1.8(c)—rule forbidding documents that bestow a gift or devise on self
      3) 1.9—Former client conflicts
      4) 2.2—Intermediary limitations. . . not so significant.
   b) In other words, if anyone has the stain, you all have the stain. Can be an
      additional level of imputation on top of lawyer leaving firm below – lawyer gets
      the stain when he leaves, and stains all members of his new firm.
5. Lawyer Leaving Firm. 1.9(b)
   a) RPC 1.9(b, c)—A lawyer cannot accept a representation of a new client in a
      substantially related matter to a client of the former firm if
      1) interests of new client are materially adverse to former firm's client; and
      2) lawyer acquired confidential (1.6, 1.9(c)) info that is material to matter.
   b) Summary, you cannot use info you got in your former firm to help a new client in
      same matter against the old firm's client.
6. Firm after a Lawyer Leaves. 1.10(b)
   a) RPC 1.10(b)—If a lawyer leaves the firm, and takes the client with him, the firm
      is not prohibited from taking a new representation that is materially adverse to the
      departed client of the departed lawyer, UNLESS
      1) Substantially related matter
      2) Any remaining lawyer has material info protected under 1.6, 1.9(c).
   b) Slightly looser standard than pure former client rule of 1.9(a). Reflects idea that
      material adversity only significant given the existence of confidential info. Such
      info is assumed for a lawyer's former client. Here, explicitly required.
7. Nemours Foundation v. Gilbane, Aetna Federal Ins. Co.
   a) Migratory lawyer case. Seems opposite to what you would expect. B found to
      have represented Nemours at previous firm. Presumed to have confidential
   b) Should be disqualification under 1.9b, and entire new firm under 1.10
   c) BUT, court does . . .?
      1) Cone of Silence? Though B is disqualified, entire firm is not.
      2) Ethics 2000 has allowed this.
   d) Why court allow this
      1) notion Nemours trying to DQ for strategic reasons – ct. considering interests
          of justice – concern of ct. of underlying motivation and also concern for
          inexperienced migrating lawyer;
      2) the steps Biggs had taken to isolate Bradley – ―Chinese Wall‖ – ―Screen‖ –
          ―Insulation Procedure‖ – ―Cone of Silence‖ – files locked up – should’t make
          diff. b/c not to talk w/other firms, nor own firm, anyway
   b) ct. went a long way to accommodate; pt. that Biggs was local counsel not primary
   c) carelessness another ct. might pt. to as not setting up proper procedures in time
      (screening when hired Bradley)
         d) RPC 1.11 – permits screens to avoid DQ w/former govt. lawyer

VII. Related Conflicts Issues from Lawyer Interests RPC 1.8
  A. Client Transactions pp562-573
     1. Business Transactions RPC 1.8(a) Court highly suspicious—Passante.
         a) Must be fair and reasonable terms to client
         b) "Stranger Rule" – same counsel an independent lawyer would give.
         c) Fiduciary Duty
         d) What about work for stock? Company takes off and the value exceeds original
            expectation (greater then fees). How do you measure reasonableness on this. The
            ABA has made an initial opinion on this issue. The ABA says you look to
            reasonableness at the time the deal was made. However, there are arguments
            being made that these contracts are unconsiounable (sp?). Look at the tobacco
            1) ―terms reasonably understood by the client‖ – this is judged in retrospect. The
                 lawyer tries to be absolutely clear, but is predicting the future.
            2) ―reasonable opportunity to seek the advice of counsel‖ – you do not have to
                 advise the client to seek representation. Any prudent lawyer will suggest that
                 the individual seeks an outside opinion. Ethics 2000 suggests that the lawyer
                 must advise to the ―desirability‖ of independent counsel.
            3) ―consent in writing thereto‖ – what does this mean. The terms of the
                 transactions? The lawyer’s role?
            4) The rule doesn’t speak to whether or not the lawyer is acting as a lawyer in the
                 transaction or not. What if the lawyer is not acting as a lawyer, but is still the
                 lawyer for the client on other matter. The Rule still applies. A number of
                 lawyers have gotten screwed because they didn’t follow the Rule in this
     2. Acquiring Interest in Litigation RPC 1.8(j)
         a) Not allowed to acquire proprietary interest in litigation being conducted for client.
         b) Contingent fees excepted, or lien for fees on client property
     3. Advancing Funds to Client RPC 1.8(e)
         a) Normally not allowed, except in contingent fee arrangements, can advance costs
            of case.
         b) And pro bono for indigent can assume costs.
         c) Policy reasons? Seems to hurt needy clients with legit claims. Might settle
            prematurely. Some "nobility" of profession crap.
     4. Gifts from Clients RPC 1.8(c)
         a) No preparation of documents giving gifts or devises.
         b) Seek to prevent improper use of influence.
         c) Smaller, non-document gifts okay if fair.
     5. Sex with Clients
         a) Not a single rule, but interaction with other rules.
         b) Breach fiduciary obligations, loss of professional judgment (2.1), may conflict
            with own interests (1.7b), lead to loss of privilege for non-legal advice seeking
            1) "Oh baby you are so good in bed, not like the hubby I killed."
             2) Might be reachable as evidence
      6. Advocate Witness Rule
         a) RPC 3.7(a) – can't be trial counsel if likely to be a necessary witness.
         b) Rest of firm?
   B. Spouses cannot be on opposite sides – RPC 1.8(i) – as with other relations
      1. Also a 1.7 issue, conflict, pulling punches stuff.
   C. Passante v McWilliam
      1. Baseball card co. gives lawyer 3% interest in gratitude – but NOT bargained for (not
         on opposite sides of table) and NO INDEPENDENT advice of counsel – so viol.
         ethical rules if bus. transaction and if gift – no delivery – so unenforceable
      2. Case pts. out almost pathological distrust cts. have for business transactions b/tw
         clients and lawyers
      3. RPC 1.8(a) transaction and terms must be fair and reasonable = LAWYER’S burden
         of proof – presumption against; 1.8(a)(3) consent in writing – put in risks, etc. – fully
      4. 1.8(c) flatly prohibits preparing an instrument that gives lawyer substantial interest
      5. w/flat prohibition – can’t even do a consent – and your partner can’t do either –
         imputed in 1.10(a) – MUST send client to another firm
      6. KNOW RPC 8.4(a) on misconduct
      7. RPC 1.8(e) – cannot loan a client $ - presents real problem in litigation when client
         not want to settle, but needs $, but on opposite end – issue of lawyers trying to feather
         own nest at client’s expense

VIII. Formation/Termination/Scope of Relationship
   A. Rules—RPC 1.2(c), 1.16
   B. s
Togstad v. Veseley, Otto, Miller & Keefe
 Consult on potential medical malpractice case
 D never agrees to take case but ct. finds AC relationship
 BURDEN is on LAWYER always in this situation – considered to be in superior position to
   make clear – to do the Right Thing
 D didn’t just talk about potential claim  gave opinion about it  step beyond preliminary
 Viol. RPC 1.2 – for Miller to merely say don’t think have case w/o more research – Luning
   takes issue w/this – if Miller properly frames initial interview and makes clear NO AC
   relationship – shouldn’t be violation
 Miller should have written a letter to her afterward and made it clear she should consider stat.
   lim. b/c some obligation leads up from this initial meeting – Quasi-AC relationship
Richardson v. Griffiths
 From the most casual conversation – AC relationship can arise – here advice on phone
 Don’t need to have mtng of minds for AC rel.  rather, it’s a client’s REASONABLE
   expectation – SCOPE of relationship
 Need to assume unless you make clear at outset that not handling specific issue – your
   responsib.  lawyer’s responsibility to define scope @ outset; otherwise – client can assume
   you’re responsible for all
 RPC 1.2(c) may limit scope w/client’s consent
   Issues of termination of relationship – RPC 1.16(a) lawyer’s right to quite NOT unqualified –
    prejudice to client
   RPC 1.16(d) on termination – take steps reasonably practicable to protect client’s interest
   Can you w/hold files? As a type of lien on payment? 1.16(d) puts enough ambiguity in
    situation that client has argument that you’re not doing what’s reas. practicable – ethics laws
    may trump rules – wouldn’t w/hold files w/o sanction of ct.

Balla v. Gambro
 Lawyer trying to come under retaliatory discharge tort
 Clear that client can discharge you anytime client wants
 Right not exist if there is some other way of protecting the public interest that’s involved
 Lawyer has UNQUALIFIED obligation under IL Ethics rule to disclose info to prevent death
   or serious bodily harm – diff. from Model Rules- says lawyer may disclose (not shall)
 No retal. discharge b/c public police adeq. protected

IX.    Duties: Court, System, Public
    A. Rules—RPC 3.3, 3.4, 3.7, 5.2, 7.6, 8.3
    B. d
   Obligation of lawyer to report misconduct of other lawyer – sent shockwave
   RPC 8.3(a) lawyer w/knowledge another’s viol. rules prof. conduct – Qs of honesty,
    trustworthiness, fitness as lawyer in other respects
   To whom do you report? Go to ct. where litig. pending or discpl. comm'n? disc. comm’n
    very jealous about its prerogatives

   ―Anatomy of a Murder‖ – ―the lecture‖ – line b/tw vigorous advocacy and not suborning
   RPC 3.4(a) provides a lawyer cannot unlawfully obstruct access to evid.  or another party’s
    access to evidence
   …ex. – told to ―sanitize the file‖ – destroy memo; unlawful? Comment 2  p. 229 – no
    proceeding pending or threat… ?
   it is the rare exceptional memo that is worse than the fact that it was destroyed (and that
    doesn’t exist in multiple counterparts
   RPC 3.4 (b) lawyer shall not falsify evidence, counsel or assist witness to testify falsely, or
    offer an inducement that is prohibited by law
   Witness that wants to be paid? Improper to pay for testimony; ***forbidden to pay for
   Legitimate to pay for expenses – hard to find difference of those two things
   RPC 3.4 (a) can’t unlawfully obstruct access to evid.; ct. order saying parties shall cooperate
    in providing evidence; partner tells you to get witness out of town?
   RPC 5.2 Responsibilities of a Subordinate Lawyer  no Q that must refuse to engage in
    unethical conduct: (a) lawyer bound by rules prof. conduct not w/standing acting at dir. of
    other person; (b) …amelioration… sort of – no viol. if in accordance w/supervisory lawyer’s
     reasonable resolution of an arguable Q of professional duty (partner’s instruction in above
     example NOT reasonable)

X.      Third Party Obligations
     A. 4.1, 4.2, 4.3, 8.4
     C. d

    As lawyer, cannot have contact w/adverse party – w/o permission of other lwyer
    In Apple Corps. case – separate contact by lawyer from contact by investigator
    RPC 8.4 (a) can’t do through someone else what you can’t do yourself; nuances of when are
     you doing that, when aren’t you… priv. investig., are independent people
    RPC 4.2 – communication w/other person
    Ct. in Apple Corps. – frustrated – straightforward stuff – shouldn’t have to go through
     litigation process to get info
    ***Q here – whether you’re really contacting an opposing party
    Comment 4 (p.277) – any persons w/mgrl. responsib. and w/any other person whose
     act/omission may be imputed to org.
    NO definitive answer
    What if the opposing party contacts you? CAN’T talk w/him – must have that party’s
     ATTORNEY’S permission
    RPC 8.4(c) lawyer cannot engage in conduct involving dishonesty, fraud, deceit, or misrep.
      ct. finds limited exception in Apple Corps.
    RPC 4.3 when dealing w/unrepresented party – must have respect for rights – can’t state that
    ***Apple Corps. court says only applies when dealing w/ as lawyer  NO CLEAR

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