Lawyers engaging in criminal conduct. Big love for immunity in Texas.

Let me offer a word or two or probably 1,000 about two recent items of interest having the issue of lawyers involved in crimes as their common thread. One comes from the Fifth Circuit and the other comes from an ABA Journal article about a situation in Utah.

First, the Fifth Circuit’s ruling in Troice v. Greenberg Traurig, LLP handed down on April 17, 2019. That case is one of many pieces of litigation involving the Allen Stanford Ponzi scheme. Specifically, this case involved a potential class action involved claims against Greenberg Traurig under a vicarious liability theory alleging that an attorney at Greenberg Traurig conspired with Stanford to further his scheme.

I am a big believer that the scope of immunity for civil liability to third parties for lawyers in connection with their acts in the representation of clients should be very broad. The most widely known version of this kind of immunity for lawyers is often referred to as the litigation privilege.

A readily-understandable example of which is this: a lawyer is representing a client and files a lawsuit for the client against a company alleging that the company’s products are defective and unsafe, according to the litigation privilege as a form of immunity, the company shouldn’t be able to sue the lawyer for defamation over those allegations.

As a proponent for this immunity to be broad in scope, I was not surprised to see the Fifth Circuit rule that Texas law would provide immunity even with respect to matters outside of litigation as long as they occurred within the scope of the representation of a client. What I was initially puzzled by, however, was the Fifth Circuit’s conclusion that a lawyer could even be immune from civil liability to a third party for criminal conduct.

My immediate reaction flowed from thinking about the fact that the ethics rules [RPC 1.2(d)] specifically delineate that “[a] lawyer shall not … assist a client, in conduct that the lawyer knows or reasonably should know is criminal.” Thus, there might be a logical basis for arguing that a lawyer using her representation to assist a client in committing a crime should not be treated as acting within the scope of a representation for purposes of civil immunity but would be treated as something outside of the scope of a legitimate representation.

Of course, the problem with that logic is how I had to insert “legitimate” in as a modifier for “representation.” Such an approach would raise questions about an array of other ways that a lawyer might violate the ethics rules during representation of a client and whether those acts should also trigger a loss of immunity from liability to third parties.

Although the opinion did not really get into any discussion of ethics rules, the Fifth Circuit was confronted by a similar argument from the plaintiffs — that criminal conduct by a lawyer is necessarily outside the scope of normal representation:

The plaintiffs also argue “attorneys are not immune from suit when they engage in criminal conduct.” Their contention is not that criminal conduct is an exception to the general rule immunizing behavior in the scope of representation but rather that criminal acts are categorically never within” that scope.

The Fifth Circuit, applying and interpreting/predicting Texas law, walked through how the Texas courts look at the issue not based on the nature of the attorney’s alleged conduct (i.e. criminal or not) but on the type of conduct (i.e. does it look like something that amounts to legal services to a client or not). Given that fact, it was easy for the Fifth Circuit to say that even alleged criminal conduct by a lawyer can be in the scope of a representation for purposes of evaluating civil immunity.

The prospect of civil immunity even for allegedly criminal conduct, however, likely does not change the fact such conduct is sufficiently dis-incentivized in other respects.

It can still subject the lawyer to potential criminal liability. And, of course, lawyers also still face the risk of professional discipline for most criminal behavior.

Most, but not all.

Which brings us to the Utah story and whether or not lawyers should face discipline for criminal conduct, if the criminal conduct in question involves polygamy. Utah apparently has a criminal statute that makes involvement in a polygamous relationship subject to as much as fifteen years in prison. The short ABA Journal piece discusses the background – a complaint has been brought by a former member of something called the Davis County Cooperative Society where polygamy is pervasive headed up by a lawyer leader — and stressing that Utah’s relevant ethics rule – like most – only addresses criminal conduct that “reflects adversely on the lawyer’s honesty, trustworthiness, or fitness” as a lawyer.

In most instances, one would think that an attorney would have a hard time pulling off a polygamous relationship without engaging in some acts of dishonesty, fraud, deceit, or misrepresentation but perhaps not here. Given the lawyer’s role as a leader of the Davis County Cooperative Society it sounds like the conduct is occurring out in the open so that deception is not part of the picture. Thus, the only way for RPC 8.4 to come into play would be for someone to try to argue that polygamy is a crime that reflects adversely on fitness as a lawyer.

As there are far too many jokes that could be made with that set up, I’ll refrain and, instead, focus on the original point about civil immunity. If Utah’s approach, was the same as the Fifth Circuit said Texas’s was, then it should mean that a lawyer could have potential civil liability to a third party for a polygamous relationship itself but a lawyer who, for example, represents clients in drafting up contracts related to a polygamous relationship, should be entitled to immunity.

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