Wisconsin rightly says no to name dropping without consent.

Earlier this week I criticized what I consider to be a pretty bad ethics opinion that was issued by Rhode Island.  To balance things out a bit, I want to write about an ethics opinion out of Wisconsin that gives the correct answer to its query – Wisconsin Formal Ethics Opinion EF-17-02.  That opinion correctly explains that because of the broad swath of confidentiality created by Rule 1.6, even the names of clients qualify as confidential information and, therefore, a lawyer can only disclose the name of a client if in advertisements or materials circulated for marketing or any other personal purpose if the client has given informed consent to the disclosure or some other exception within Rule 1.6 applies.

In issuing this opinion, Wisconsin had to withdraw an older opinion that provided guidance that the names of clients were not confidential information, Wisconsin Ethics Op. E-93-5.

Lots of lawyers (not just in Wisconsin) do not immediately grasp that this is the correct result — that the identity of a lawyer’s clients is itself confidential information.  A lot of times they don’t do so because doing so requires recognizing that there are a lot of things lawyers do that they really shouldn’t without getting their clients approval.   The Wisconsin opinion uses the example of talking about the fact of a representation as a cocktail party as an example, but there are less obvious ways this issue crops up.  Lawyers often don’t think twice about providing information about the details of their prior representations as part of responding to requests for proposals from insurance carriers as part of trying to become approved as panel counsel, for example.  Some lawyers will rationalize their approach on the basis that they are only disclosing information that can already be found in public records, but the Wisconsin opinion rightly makes the point that Rule 1.6 doesn’t remove the obligation of confidentiality for the lawyer merely because the information is available in a public record.

I’ve often attempted to explain the policy choice that Rule 1.6 enshrines for lawyers along these lines.  Imagine you are a family law attorney.  Now in order to file a divorce complaint for a particular client you are going to have to disclose in the filing a lot of details about your client’s life that they really hope no one finds out about.  Members of the public certainly could go down to the courthouse or go online if the court has electronic records and read all of the sordid details, but the client definitely hopes people don’t.  The ethics rules stake out a position – at least jurisdictions that have the ABA Model Rule version of Rule 1.6 do — that even though the lawyer has to put those things in the public complaint, lawyers are going to be charged with not talking about those things without the client’s consent to do so.  I then often ask lawyers to think about how a conversation would go if you called your client and asked them for permission to offer up the interesting anecdote about their situation.

The ramification of that policy choice ends up being that the rule errs on the side of confidential treatment even for things that many clients might not even expect could be confidential and that’s the reason, for example, that firms who circulate materials about representative clients, whether on their website or elsewhere, need to get client permission to do so.

While Wisconsin’s opinion is praiseworthy on its substance, Wisconsin should still get criticized for its insistence on shielding its formal ethics opinions from the public and providing access to them only for members of the Wisconsin Bar.  That’s a silly and outdated approach.

As a Tennessee lawyer, I only know about what the new Wisconsin opinion says because the fine folks at ABA/BNA reported on it.  Presumably, as they always do, they did a good job and, thus, if you go read their article here then you, like me, can know what Wisconsin had to say in construing its ABA Model Rule-based ethics rule on confidentiality.

Coming full circle, while I can’t stand the substantive outcome offered up by that Rhode Island opinion discussed earlier this week, at least Rhode Island allows for public access to the ethics opinions it issues.  For as long as there continue to be jurisdictions like Wisconsin that shield theirs from view, then offering public access will continue to deserve praise in Rhode Island and elsewhere.

Bad ethics opinion or the worst ethics opinion? Rhode Island 2017-02

I have perused a lot of ethics opinions over the years.  Whether a kind of scenario presents a conflict is a frequent subject of ethics opinions.  I don’t think I’ve read many that address whether a particular conflict of interest is fairly treated as a consentable conflict, however.  Having now read Rhode Island Ethics Advisory Panel Op. 2017-02, which does address that topic, I wish it hadn’t.

It is an extremely short opinion, but it gets a remarkable amount wrong in a limited amount of space.

The short version of the question it tackles is:

ISSUE PRESENTED

The inquiring attorney asks whether the law firm may represent the buyer and the seller, two current clients of the firm, in the sale of a division of the seller’s business to the buyer.

The additional factual details that you need, at minimum, to begin to wrap your head around the astoundingly bad conclusion reached in the opinion are:

  • The buyer is a manager of a division of the seller’s business.
  • The buyer will now be purchasing assets of that division from the seller.
  • The buyer will then also have to work out a lease arrangement with the seller for the premises where the division currently operates.
  • The buyer has been represented by one attorney in the firm on a number of matters unrelated to this business – that attorney has no relationship with the seller or any knowledge of work done for the seller by his/her firm.
  • The seller has been represented by a different attorney in the firm on a number of matters, including matters related to the operation of the seller’s business  – that attorney has no relationship with the buyer or any knowledge of work done for the buyer by his/her firm.
  • Both the buyer and the seller want the firm to represent them as to negotiations and drafting of necessary documents.
  • The firm, if it moves forward, intends to erect an ethics wall/screen (i.e. locked drawers for hard copy materials and limits on electronic access to files) as to the two matters so that there would be no flow of confidential information between the two sides of the proposed representation.

On those facts, the Rhode Island opinion reaches a conclusion that the conflict is so severe that the clients cannot be allowed to give their consent to it.  Now, maybe I have left out the facts that the ethics opinion treats as apparently the most important of all – the distinction between the experience level of the seller and the buyer:

The inquiring attorney states that the seller is experienced in business, including the ownership, purchase, and sale of businesses.  He/she states that the buyer is sophisticated in the industry of the division, but has never owned, purchased, or sold a business.

Well, there you go.  The seller is super sophisticated whereas the buyer is just merely sophisticated.  Seriously.

And, no there is nothing unique or unusual about Rhode Island’s version of RPC 1.7 that would explain the conclusion that this conflict is not consentable.  Rhode Island’s RPC 1.7(b) looks just like the ABA Model version, as it reads:

(b) Notwithstanding the existence of a concurrent conflict of interest under paragraph (a), a lawyer may represent a client if:

(1) the lawyer reasonably believes that the lawyer will be able to provide competent and diligent representation to each affected client;

(2) the representation is not prohibited by law;

(3)  the representation does not involve the assertion of a claim by one client against another client represented by the lawyer in the same litigation or other proceeding before a tribunal; and

(4) each affected client gives informed consent, confirmed in writing.

On the facts set out above, the Rhode Island opinion concludes that there is no way that each lawyer could “reasonably believe that they will be able to provide competent and diligent representation to the buyer and to the seller in this business transaction.”

And, if that weren’t problematic enough (it is), the opinion also does further disservice to readers with its discussion of screening, stating:

The Rules of Professional Conduct permit screening in only three situations, none of which is presented in the facts of this inquiry: screening for lateral hires under Rule 1.10, screening for former government officers and employees under Rule 1.11, and screening for former judges, arbitrators and mediators under Rule 1.12.

The omission of the modifier “nonconsensual” before screening in that quote is an important one.

It’s important because it means that the Rhode Island opinion writers either failed to understand altogether, or simply chose to ignore, the difference between aspects of the ethics rules that permit a firm to erect a “nonconsensual screen” to address a conflict even over a client’s or former client’s objection and the constant ability of a firm to erect a consensual screen if it is part of what is deemed necessary or desirable in order for one or more clients to agree to give informed consent to waive a conflict.

On the whole, this is just an astoundingly poor ethics opinion and one that reaches a result that rings contrary to the client-friendly position that I’m certain the authors thought they were taking.

Ohio Opinion 2017-1: Too much and too little at the same time

An opinion worthy of discussion was issued in Ohio back in February 2017  but I didn’t stumble across it until this past week.  (A tweet by ALAS got it onto my radar screen.)

Advisory Opinion 2017-1 from the Ohio Board of Professional Conduct addresses advertisement of contingent fee arrangements and, in particular, it addresses the following question:

Whether it is proper for a lawyer who advertises to use statements such as “No fee without recovery” or “You pay no fee unless you win” or “There’s no charge unless we win your case” or “You pay us only when we win.”

The opinion focuses only on the distinction in a contingent fee arrangement between fees and repayment of advanced expenses and, as a result, offers the same answer to all of the examples – no.  Now even on the opinions own terms – focusing only on the distinction between expenses and fees, I disagree that all of those should get a “no” answer, but I also think that the Ohio opinion missed an opportunity to evaluate an even more significant question about these kind of statements that has always hit me as potentially problematic.

First, as the opinion explains all of these statements must be run through the filter of RPC 7.1 and a determination has to be made about whether they are false or misleading.  The Ohio opinion concludes that all of the variations of statements tackled are “inherently false or misleading” because they “omit reference to the client’s responsibility for expenses and costs” and thereby “impl[y] that the client will not be required to pay litigation costs, regardless of the outcome of the litigation..”

On one level, I think that goes too far in terms of a harsh result for the two of the four examined statements that plainly speak in terms of “fees.”  To say that those are inherently misleading is a conclusion with which I just disagree.

On another level though, I think this opinion doesn’t go far enough because it fails to address a more legitimate question of how such advertisements can be misleading.

In my opinion, three of the four statements have a problem but it is because of the use of “win” as the conditional event triggering payment of fees.  A client who pursues a contingent fee case and has a serious injury but ends up settling their case for a small amount, let’s pick $30,000 as a random amount, might very well not consider their lawyer to have “won” their case.  For me, the statement that ought to be the exemplar for use is the first one “No fee without recovery.”  And the second one ought to be acceptable if it were to say “You pay no fee unless we recover for you.”  Maybe each of those statements would be even better if “attorney” came before “fee” but I think that’s the path where a consumer is more likely to feel misled or deceived by such an advertisement rather than on the basis that there is an implication about expenses if a lawyer only speaks in the advertisement in terms of fees.

A weird-ish ethics opinion out of New York.

I have written a few times about the ABA’s adoption of a new Model Rule 8.4(g).  One point that was brought up in the run-up to that rule actually finally being adopted was that some more than 20 jurisdictions already had an anti-discrimination rule in place in the black letter of their rules in one form or another.

One of those jurisdictions is New York, and the New York State Bar Association Committee on Professional Ethics issued an ethics opinion back in January of this year that says it addresses an interpretation of NY’s Rule 8.4(g) and whether it prohibits a lawyer from refusing to accept a representation because of a lawyer’s own religious affiliation.

Specifically, the scenario addressed in NYSBA Ethics Opinion 1111 is this:

A lawyer has been requested to represent a person desiring to bring a childhood sex abuse claim against a religious institution.  The lawyer is of the same religion as the institution against which the claim is to be made.  Because of this religious affiliation, the lawyer is unwilling to represent the claimant against the institution.

The opinion, ultimately, doesn’t really answer the question of whether refusal to accept under those facts would be illegal discrimination.  Instead, the opinion first provides reassurance (at least of the rhetorical variety) that lawyers do not have any ethical obligation to accept every request for representation that they receive.  Then, though, it mostly punts on how to reconcile that fact with the fact that lawyers cannot engage in conduct that would violate a federal, state, or local anti-discrimination statute.  The opinion references New York case law which addresses certain kinds of professional services as being “place[s] of public accommodation” and directly admits that New York’s 8.4(g) contains language acknowledging that law could limit a lawyer’s ability to freely choose to decline a representation, but, despite the fact that the very rule itself that New York chose to adopt requires for its enforcement a conclusion about “unlawful discrimination,” just punts on whether the facts trigger such a conclusion.

At some level I get why the opinion goes that route as typically bodies providing ethics opinion have refrained from ruling on questions of law as being outside the scope of the rules.  But it does seem to me like once you adopt a rule that envelops the need for such a legal determination into the enforcement of the rule, you lose some of the ability to credibly punt on such an issue.

For context, here is the language of the rule New York has in place providing that a lawyer shall not:

(g) unlawfully discriminate in the practice of law, including in hiring, promoting or otherwise determining conditions of employment on the basis of age, race, creed, color, national origin, sex, disability, marital status or sexual orientation. Where there is a tribunal with jurisdiction to hear a complaint, if timely brought, other than a Departmental Disciplinary Committee, a complaint based on unlawful discrimination shall be brought before such tribunal in the first instance. A certified copy of a determination by such a tribunal, which has become final and enforceable and as to which the right to judicial or appellate review has been exhausted, finding that the lawyer has engaged in an unlawful discriminatory practice shall constitute prima facie evidence of professional misconduct in a disciplinary proceeding….

For what it is worth, you would think that the body issuing the opinion could — at least on this particular inquiry – have been able to comfortably say that since the facts presented did not even involve a lawyer turning down a potential client because of the potential client’s religious affiliation that it would be safe to say that it is highly, highly unlikely that a credible case of unlawful discrimination could be made out against the lawyer.

One thing that this opinion does help sharpen in terms of a salient point is that ABA Model Rule 8.4(g) appears to be a better drafted approach to this issue given its explicit terms protecting decisions on whether to take on the representation of a client.  Unlike the New York version of the rule, the ABA Model — in addition to not having all the language about the need for a ruling by a tribunal to be a condition precedent in certain instances — includes this sentence in the black-letter of the rule:  “This paragraph does not limit the ability of a lawyer to accept, decline or withdraw from a representation in accordance with Rule 1.16.”

Jurisdictions adopting a version of Rule 8.4(g) with that kind of language would appear to be much better positioned to actually address questions like the one raised in the New York opinion by providing the lawyer with assurance about the ability to simply choose not to take on the representation of a client where doing so would require them to sue their own church.

 

Lateral moves can be hard. One type in particular is harder than the rest.

In 2017, a lawyer moving from one law firm to another is a pretty common place occurrence.  Anyone who has been through the process knows how personally difficult and stressful the ordeal can be no matter how excited you are about your next destination.  The emotional and personal components alone can be trying, but the pressures imposed by the ethics rules are often overlooked … even though they shouldn’t be.

One area where the requirements of the ethics rules can make a potential lateral move nearly impossible is if a lawyer is looking to join a firm that is on the other side of an ongoing legal matter.  A well-done, quite succinct ethics opinion out of North Carolina issued near the end of January 2017 explains what the ethics rules actually require in order for such a move to be possible.   (And, important note to add, we’re only talking about if the lawyer looking to lateral is looking at moving from one private practice position to another private practice position.  Moves into and out of government employment are different and governed by different rules.) North Carolina Formal Ethics Op. 2016-3, titled “Negotiating Private Employment With Opposing Counsel,” lays out the sticking point that make this kind of lateral move more difficult than others — there comes a point in time when any such discussions have become serious enough — even though there is not yet any done deal — that both sets of clients have to give their informed consent for the negotiations/discussions to continue.

The ethics risk that mandates this result is the “material limitation” conflict that arises from the personal interests of the lawyers involved requiring consent under Rule 1.7(a)(2).  In laying this out, the North Carolina opinion echoes sentiments previously expressed in (1) an ABA Formal Opinion from 1996, (2) The Restatement (Third) of the Law Governing Lawyers, and (3) a Kentucky ethics opinion issued in 1998.

The North Carolina opinion also provides a similar description as did those other authorities of the moment in time that matters in terms of triggering the need to obtain the client’s consent: when the discussions become “substantive.”  The opinion also describes, in practical terms, what is necessary for each side of the potential lateral discussion to seek out and obtain consent from its respective client:

To obtain the client’s informed consent, the job-seeking lawyer must explain to the client the current posture of the case, including what, if any, additional legal work is required, and whether another firm lawyer is available to take over the representation should the lawyer seek to withdraw.  If the client declines to consent, the job-seeking lawyer must either cease the employment negotiations until the client’s matter is resolved or withdraw from the representation but only if the withdrawal can be accomplished without material adverse effect on the interests of the client.  Rule 1.16(b)(1).  Because personal conflicts of interests are not imputed to other lawyers in the firm, another lawyer in the firm may continue to represent the client.  Rule 1.10(a).

Similarly, the hiring law firm must not engage in substantive employment negotiations with opposing counsel unless its own client consents.  If the client does not consent, the firm must cease the employment negotiations or withdraw from the representation.  The firm may only withdraw if the withdrawal can be accomplished without material adverse effect on the interests of the client.  Rule 1.16(b)(1).

Most lawyers like to think of themselves as being risk averse as a general matter.  Interestingly enough, when the depths of the details are fully mined, the notion of doing what the North Carolina opinion indicates is required might seem riskier than not saying anything at all.  The situation gets more difficult for some lawyers to work through because it can be viewed as something of a modified prisoner’s dilemma situation — each side of the potential employment discussion may be making its own independent decisions about whether the situation has escalated to a point of seriousness where client notification and consent is required, and each side has its own thoughts about what is the right answer for each side (stop talking or withdraw) if the affected clients won’t consent.  While the two parties to the discussions might seemingly be in harmony about the potential move otherwise, they may very well have starkly different views in terms of balancing how important they value the business of the affected client versus the business that could be gained from the lateral move.

As a result, I have long suspected that most such moves that actually come to fruition are the products of one side or the other not strictly complying with their ethical requirements.  No, that is probably too cynical a thing to say and certainly a bit of an exaggeration of my view.

Some percentage of the moves that actually work out are the product of something less than strict compliance.  Probably not the majority, however.

The majority of them likely either involved matters for clients who are so incredibly important to the economics of the deal that there is a need to know sooner rather than later whether the impacted clients will consent or matters for clients who are of such little economic significance that all of the lawyers involved would be happy to jettison their matter if consent is not forthcoming.

An even more important factor in play that likely can be dispositive about whether such a move can be made is whether the jurisdiction involved permits the use of nonconsensual screening to avoid imputation of a disqualifying conflict.  No mention is made of this topic in the North Carolina opinion because North Carolina does not have any language in its version of Rule 1.10 to permit such screening.

In Tennessee, scenarios involving lawyers who aren’t litigators are potentially much more viable lateral moves because of our weirdish rule that treats “side switching” situations in litigation differently than in other contexts.  In Tennessee, whether a nonconsensual ethics wall can be erected to avoid disqualification from a lateral move can have a different answer depending on whether the matter is a litigation matter or not.

Our RPC 1.10 reads in relevant part:

(c) Except with respect to paragraph (d) below, if a lawyer is personally disqualified from representing a person with interests adverse to a client of a law firm with which the lawyer was formerly associated, other lawyers currently associated in a firm with the personally disqualified lawyer may represent the person, notwithstanding paragraph (a) above, if both the personally disqualified lawyer and the lawyers who will represent the person on behalf of the firm act reasonably to:

(1) identify that the personally disqualified lawyer is prohibited from participating in the representation of the current client; and

(2) determine that no lawyer representing the current client has acquired any information from the personally disqualified lawyer that is material to the current matter and is protected by RPC 1.9(c);

(3) promptly implement screening procedures to effectively prevent the flow of information about the matter between the personally disqualified lawyer and the other lawyers in the firm; and

(4) advise the former client in writing of the circumstances that warranted the implementation of the screening procedures required by this Rule and of the actions that have been taken to comply with this Rule.

(d) The procedures set forth in paragraph (c) may not be used to avoid imputed disqualification of the firm, if:

(1) the disqualified lawyer was substantially involved in the representation of a former client; and

(2) the lawyer’s representation of the former client was in connection with an adjudicative proceeding that is directly adverse to the interests of a current client of the firm; and

(3) the proceeding between the firm’s current client and the lawyer’s former client is still pending at the time the lawyer changes firms.

Thus, a Tennessee lawyer could make a move from one side of the table to the other in the middle of a $50 million real estate deal but could not make the same move if it involved moving from one side of the “v” to the other in a $10,000 automobile accident lawsuit.

Bad ethics opinion or the worst ethics opinion? New York State Bar Ethics Opinion 1110 edition

Again, not fair actually.  This NY ethics opinion isn’t in the running for being the worst ethics opinion and isn’t even truly bad and actually, I guess, not even wrong.  But it does point out a really bad flaw with respect to the language of the particular NY rule it applies.

What seems like an exceedingly long time ago now, I was first inspired to title a post with this “Bad or Worst” title.  I did so when I wrote about what I thought truly was a woeful ethics opinion — and one that I cannot believe anyone even asked about in the first place — in which the Ohio Board of Professional Conduct imposed some ridiculous limitations on the ability of a lawyer to communicate with attendees at a seminar or continuing legal education presentation.

The subject matter of NY State Bar Ethics Opinion 1110 is similar – whether New York’s ethics rules on advertising, and derivatively solicitation, apply to a situation in which an attorney wishes to invite people to come to a seminar that he would put on regarding intellectual property issues.  As the opinion explains:

The inquirer, an intellectual property lawyer practicing in New York, plans to conduct online webinars and live seminars on topics within his principal fields of practice for persons who may have a business interest in those topics and a need for legal services.  Inquirer contemplates identifying persons fitting that description by use of commercially available business listings, including such listings on government agency web sites, such as business entity lists.  Admission to the webinars and seminars may be free or may be for a fee.

The opinion then lists a litany of questions it has to resolve to determine whether this can be done, but the core question is whether the seminars would be advertisements and, if so, whether they would be solicitations.  Now the opinion goes on at some length about ways that the lawyer could limit what is said or done at any such presentation so that it would not even qualify as an advertisement, but, eventually, it does the practical thing and assumes that the lawyer would likely during the seminar say things that would amount to talking about his “skills or reputation” sufficient to make the seminar an advertisement.

Assuming it is an advertisement, the opinion then also quickly gets to the conclusion that the seminar would be a solicitation — and that it would be an in-person solicitation, and, thus, the attendees would have to be limited to “close friends, relatives, former client(s), or existing client(s).”

This is the moment where, inside my head, there is the sound of screaming.

It is one thing to have an ethics rule that imposes strict prohibitions on in-person solicitations.  That’s fine.  It is also fine to have an ethics rule that requires, as to written solicitations, certain requirements about those.  I often disagree with the details of what states require as to disclaimers or font sizes, but I can be swayed not to get up in arms about the requirements.  It is another thing to have a rule that creates such a strict definition of solicitation to justify writing an ethics opinion that would say that someone who accepts an invitation to attend a seminar is being subjected to a solicitation at the seminar they could have just chosen not to attend.

The closest that New York’s RPC 7.3(b) gets to carving out communications that are initiated by a person who isn’t a lawyer from being a solicitation is the language that states that solicitation . . . “does not include a proposal or other writing prepared and delivered in response to a specific request of a prospective client.”

But the inanity of the outcome articulated by this ethics opinion is pretty epically demonstrated by analogy to an actual written solicitation letter to a targeted potential client.  Assume that a lawyer sends one of those, and complies with all the bells and whistles in such a written communication as to what the envelope cannot say, the font size, the disclaimers at the beginning, and mandatory language, but the recipient then decides — “hey, I’m interested in hearing what a lawyer could do for me” and proceeds to go to the lawyer’s office to ask for a meeting.  Everything that happens then is.not.a.solicitation.

The rules regarding in-person solicitation seek to protect potential consumers of legal services from overreaching by lawyers.  That is the espoused rationale.  I often, with tongue-in-cheek, will explain at seminars that such rules exist because when we graduate law school we have been imbued with superpowers as to persuasion that allow us to convince mere mortals to do things that they otherwise would never do but for our incredible superpowers.  (I can often then use the exception to the rules against solicitation for lawyer-on-lawyer solicitation to explain that since both sides have equal superpowers there is no need for the protection.)

But, in the conceptual situation evaluated by this formal ethics opinion, if the recipient of the invitation to the seminar doesn’t want to be in a room where a lawyer is speaking about the area of law in which they practice, they.can.just.not.go.to.where.the.seminar.is.happening.

What is missing from the text of New York’s rule to prevent this sort of result is the language that we have here in Tennessee in RPC 7.3(a)(3) indicating that an in-person or real-time solicitation of professional employment from a potential client is not prohibited if “the person contacted . . . has initiated a contact with the lawyer.”

Arkansas and Wisconsin weigh in on client files in different ways and on different sides.

The need for clarity with respect to what makes up the “client file” has been an issue I have tried to stay up to date on dating back to our unsuccessful efforts back in 2009 to convince the Tennessee Supreme Court to adopt a rule – what would have been RPC 1.19 — to address the issues.  As I’ve explained before, our unsuccessful RPC 1.19 was patterned largely after North Dakota’s Rule 1.19.  There is no ABA Model Rule addressing client files and, as recently as last year, the ABA’s guidance as to client files still leaves many questions open so states navigate these waters pretty much on their own using only the language about lawyers’ obligations to “surrender papers and property of the client” in their versions of Model Rule 1.16.

As you may recall from a couple of posts I wrote last year, some seven years later we’ve obtained some real clarity in Tennessee on a few fronts as to client files through two Formal Ethics Opinions issued by our Board of Professional Responsibility.  Particularly, we now have clear guidance that we are an “entire file” jurisdiction rather than an “end product” jurisdiction regarding what are the contents of the client file.

Late last year, Arkansas adopted its own RPC 1.19 addressing client file issues but although they went with an approach that adopts a black letter rule to address the matter, they’ve gone in the opposite direction from us as Arkansas RPC 1.19 opts for an “end product” approach.  Technically, Arkansas has been an “end product” jurisdiction for more than seven years dating back to a 2009 opinion of the Arkansas Supreme Court – Travis v. Committee on Professional Conduct.  You can read the Arkansas Supreme Court order with the full text of RPC 1.19 and its comments here.

The architecture of this new Arkansas rule tackles client file questions in two parts.

RPC 1.19(a) defines what makes up the contents of the client file both positively [(a)(1) identifies items that are in] and negatively [(a)(2) identifies items that are excluded] .  The most important exceptions being “the lawyer’s work product,” “internal memoranda,” and “legal research” materials.  It appears though that (a)(2)(E) serves to override any attempt to view (a)(1) as a comprehensive identification of what is included as that subpart explains that anything that isn’t listed as excluded in (a)(2)(A-D) are things that “shall be considered to be part of the client file to which the client is entitled.”  RPC 1.19(a) also addresses the need to honor requests by the client for delivery of file and when a lawyer may charge costs of copying or retain a copy for their own purposes.  Smartly, the rule also expressly clarifies that a lawyer and client can address all of those issues regarding copy costs and delivery costs in a fashion they prefer by contract as part of the engagement agreement.

RPC 1.19(b) addresses the length of the obligation to retain client file records and under what circumstances a lawyer can destroy client files in his possession.  Five years is the default length of time chosen for retention in Arkansas, and any time after that the lawyer is free to destroy the file materials.  RPC 1.19(b)(3) also makes clear that these time frames can be varied by contract between attorney and client.  RPC 1.19(b)(4) takes certain criminal matters out of the general rules of retention and destruction, however, and instead requires the lawyer to maintain the client’s file for the life of the client in those particular situations.

Another jurisdiction has weighed in recently but differs from what Arkansas has done both structurally and substantively.  Wisconsin recently put out an ethics opinion to further clarify the obligations lawyers have to clients in terms of turning over files at the end of the representation.  Wisconsin, like Pennsylvania, denies public access to its ethics opinions, but you can read a well-written article about Wisconsin Formal Ethics Op. EF-16-03 here.

The primary focus of the formal opinion appears to be clarifying that lawyers can neither try to leverage retaining the client file in order to obtain payment nor condition turning the file over upon the execution of a release of malpractice liability.  (Both things you might be surprised to hear about how often lawyers attempt to do despite the perils.)

But Wisconsin’s latest opinion on the subject matter also addresses some of the same vital issues that are at the heart of resolving situations involving disputes between attorneys and clients over who is entitled to what.  Unlike Arkansas, Wisconsin takes an approach more in keeping with the “entire file” approach to the question as several items carved out from the file in Arkansas are not in Wisconsin.  The Wisconsin opinion specifically identifies “legal research and drafts of documents that are relevant to the matter” as being included in the client file as well as “[a]ny materials for which the client has been billed, either directly or through lawyer or staff time.”

Yet, the Wisconsin opinion does limit certain categories of items as being allowed to be withheld from the client — including two items that were at the heart of the battles that doomed our effort in Tennessee to adopt an RPC 1.19 of our own — “materials containing information, which, if released, could endanger the health, safety, or welfare of the client or others,” and “materials that could be used to perpetrate a crime or fraud.”  Interestingly, however, the Wisconsin opinion also crafts an exclusion for materials that seems pretty antithetical to the idea that the guidance is really consistent with Wisconsin being an “entire file” jurisdiction:

Materials containing the lawyer’s assessment of the client, such as personal impressions and comments relating to the business of representing the client.  If a lawyer’s notes contain both factual information and personal impressions, the notes may be redacted or summarized to protect the interests of both the lawyer and the client.

The Wisconsin opinion also addresses the inability of the lawyer to hold the file hostage as a way to first receive payment and provides a clear answer that a lawyer cannot refuse to provide the entire file at the end of the representation based on an argument that lawyer provided everything to the client along the way during the life of the representation.  The Wisconsin opinion also offers insight on when the lawyer has to provide a client with an electronic copy of a file and stresses that while a lawyer can retain a copy of the file, the lawyer cannot charge for that expense because that is being done for the lawyer’s own benefit.

Another interesting wrinkle of the Wisconsin opinion is that it gives a nod to a scenario that is rarely discussed in such opinions — though it does come up in discussions of “red flags” of new client intake matters — but that is an exceedingly difficult situation to deal with:  “There may be unusual circumstances where a client has specifically instructed a lawyer not to surrender a file to a successor counsel, and the lawyer must abide by those instructions.”

In the end though, both the Wisconsin opinion and, in part, the Arkansas rule, offer guidance that furthers what ought to be the primary, practical guidance for lawyers given the disparities that exist on this issue from jurisdiction to jurisdiction — the more focus can be given to these issues in an engagement agreement such that you can have a contractual agreement between lawyer and client on just what will be provided, how, and when (and at whose cost) the better off all involved will be.

 

Two quick technology takes – texting and more on email “bugs”

Not too long ago, I weighed in on an Alaska Ethics Opinion about the ethics of lawyers using email “bugs” that surreptitiously track what happens to an email after it has been sent.  There is a new, interesting read on the “legal or not” aspect of this technology in the ABA/BNA Lawyers Manual on Professional Conduct authored by Chad Gilles, a former lawyer who is now involved with customer strategy and legal affairs with a company called MailControl.net.  It certainly makes for an interesting and informative read, and I appreciate the short mention of a snippet of what I said here on my blog.  I was surprised in the Gilles article to read that Professor Dane Ciolino of Loyola University New Orleans had espoused a belief that it was ethical to use such technology if you were a sending lawyer and, for what it is worth, I’ve now gone and read Ciolino for myself on the issue  and … well, color me still unconvinced.

For what it is worth, the notion that Gilles explains that the jury is out on whether the conduct — using mail bugs — also runs afoul of one or more federal statutes (think the Electronic Communications Privacy Act and the Computer Fraud and Abuse Act) leaves me more confident that my conclusion that the conduct is unethical is on the right side of things.

On an unrelated note — other than being related by way of the broadly encompassing “technology” category — Thomas Spahn and I will be doing a teleseminar on January 20, 2017 focusing specifically on a variety of ethical issues that can arise in connection with lawyers using text messaging to communicate with clients and each other.  I haven’t been fortunate enough to do a seminar with Tom in a few years and am looking forward to discussing this topic with him.

I’ve also spent a little bit of time — unsuccessfully — trying to re-find a case/situation that was reported on within the last couple of years involving a lawyer who saw part of the contents of a text sent to a judge because the judge’s phone was laying out on the bench and it lit up and the first part of the message was viewable.  I can’t remember if it was the lawyer who got in trouble for the snooping or the judge because of what was on the text, but I remember it happening.  It serves as a great teaching tool for thinking about turning off the “preview” function for texts on your smart phone, but only if I can properly reference it.

If anyone reading this, recalls it or is more proficient at finding it before January 20, I’d appreciate you shooting me a message of where to find it.  And, either way, if you have the time please feel free to sign up for our teleseminar — it is being offered through a variety of bar entities so you should be able to find it with a google search, but here’s a link to one state bar where you can sign up for it.

 

Two smart, practical ABA Ethics Opinions in a row. (And a bonus “beg to differ”.)

So, this week the ABA Standing Committee on Ethics and Professional Responsibility issued Formal Op. 476 addressing the need to protect client confidentiality when a lawyer seeks to withdraw for reasons involving the client’s failure to pay.  As explained below, it is a solid, practical opinion touching on a subject often overlooked by lawyers who are just trying to get out of a case with as little additional wasted time and expense.

It comes on the heels of an opinion from earlier this month about a lawyer’s obligation to hold fees to be shared with a lawyer from another firm separate from the lawyer’s own funds, ABA Formal Op. 475, which — despite what this solo and small-firm centric blogger wrote recently — is also a practical, well-constructed, and correct opinion.  I have to beg to differ with the My Shingle piece because it misses the boat on the primary type of situation the ABA Formal Op. 475 is vital to addressing — where lawyers in different firms are sharing fees in a contingency case.  When you come at the question from that perspective as a starting point, the answer offered in the opinion is clearly the only answer that can be correctly offered.  The My Shingle complaints are readily resolved by simply working out a better front-end arrangement with a client about payment to multiple lawyers.

(N.B. – it can’t just be coincidence that these two opinions appear to be the first two in which my friend, Doug Richmond, shows up as a member of the committee involved in the issuance.  Doug is an excellent lawyer – as of course are all the lawyers on the committee — but Doug also has a flair for delivering practical advice through clear, straightforward written work product that leaves the reader with an abiding sense that the conclusion reached was inescapable.)

ABA Formal Op. 476 also does a nice job in tackling and acknowledging the interplay between trial court and lawyer in these circumstances.  The opinion truly can be well summed up if you lack the time or wherewithal to read it in full by simply quoting its “Conclusion,” section:

In moving to withdraw as counsel in a civil proceeding based on a client’s failure to pay fees, a lawyer must consider the duty of confidentiality under Rule 1.6 and seek to reconcile that duty with the court’s need for sufficient information upon which to rule on the motion.  Similarly, in entertaining such a motion, a judge should consider the right of the movant’s client to confidentiality.  This requires cooperation between lawyers and judges.  If required by the court to support the motion with facts relating to the representation, a lawyer may, pursuant to Rule 1.6(b)(5), disclose only such confidential information as is reasonably necessary for the court to make an informed decision on the motion.

As it stands, I really only have one item of criticism regarding Formal Op. 476 at all.  Yet it feels almost like nitpickery … in that I would have liked to see the opinion manage more clearly to stress that the need for protecting client confidences and discretion in any disclosure to a court regarding withdrawal applies to more withdrawal situations than merely not being paid.  Far too many times than I care to count have I been sitting in a courtroom and listened to a lawyer in the context of seeking withdrawal in some matter on the docket ahead of my case say too much, unprompted about their communications (or lack thereof) with the client.  The opinion says it is limiting itself to the deadbeat client situation because in other situations other rules and principles may apply, but I think there would have been value in exploring the commonalities.

The only other thing I’d like to use ABA Formal Op. 476 as a springboard to say involves highlighting an aspect of the rule we have here in Tennessee and how it provides a very helpful, practical mechanism for doing what the ABA Opinion actually encourages when it says:  “Of course, where practicable, a lawyer should first seek to persuade the client to take suitable action to remove the need for the lawyer’s disclosure.”  In the context of the ABA Formal Op. that would appear to be either: (1) pay the lawyer; (2) hire other counsel that can substitute in lieu of withdrawal, or perhaps (3) fire the lawyer so that withdrawal becomes mandatory.

In Tennessee, we offer another option as our RPC 1.16(b) also lists as a trigger for discretionary ability to withdraw merely that the client has provided informed consent confirmed in writing to withdrawal by the lawyer.  Such a clear escape valve in the rule permits a lawyer – even in a situation in which the client has become a deadbeat – to be able to counsel the client and explain that if the client will go ahead and provide informed consent to withdrawal, and show that consent by signing the motion itself, it can go an exceedingly long way in eliminating the risk that the lawyer will have to say anything about the client’s failure to pay in response to an inquiry from the court.

DC Ethics Opinion 370 – Y’all knew I wouldn’t be able to resist

So, the D.C. Bar has come out with a far-reaching, sort of two-part ethics opinion addressing lawyers and social media usage.  Opinion 370 (Part 1) can be grabbed here.  Opinion 371 (Part 2) from here.  Opinion 370 has lots of really good parts, but much of the publicity it has received to date revolves around something it throws out for lawyers to bear in mind and be wary of that hasn’t really been said by opinion-writing entities before.

Here’s how the ABA Journal online headline treated it – “beware” of “social media statements on legal issues.”  Other aspects of the reporting I have seen described it as warning lawyers who offer opinions online of the potential for creating an “issue” conflict.  There’s a reason, I think, this topic hasn’t been explored much by other opinion-writing bodies:  it is a relatively silly and irresponsible take.  Regardless, given the minimal treatment of the issue that the opinion offers, even if you think there were merit to flagging the issue for consideration, the portion of Opinion 370 that “addresses” it still would be better left on the cutting room floor.

Here, in its entirety, is the analysis of this issue as a risk for lawyers from the DC Opinion:

Caution should be exercised when stating positions on issues, as those stated positions could be adverse to an interest of a client, thus inadvertently creating a conflict. Rule 1.7(b)(4) states that an attorney shall not represent a client with respect to a matter if “the lawyer’s professional judgment on behalf of the client will be or reasonably may be adversely affected by . . . the lawyer’s own financial, business, property or personal interests,” unless the conflict is resolved in accordance with Rule 1.7(c). Content of social media posts made by attorneys may contain evidence of such conflicts.

Now, to help get your bearings straight if you aren’t a D.C. lawyer, D.C.’s Rule 1.7(b)(4) is different from what is set out in the ABA Model Rules and, thus, different from what we have here in Tennessee (for example) in the closest equivalent rule, RPC 1.7(a)(2).  Our RPC 1.7(a)(2), just like the ABA Model, establishes a conflict of interest — albeit a potentially consentable one — where “there is a significant risk that the representation of one or more clients will be materially limited by the lawyer’s responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.”

In a (stop-me-if-you-heard-this-one-before) well-done story by Samson Habte with the ABA/BNA Lawyers’ Manual on Professional Conduct, some quotes are gathered from folks pointing out that the concept of an “issue” or “positional” conflict of interest necessarily involves or requires taking contrasting positions in front of one or more tribunals and, thus, a lawyer’s public statements of opinion about a legal question couldn’t create a positional or issue conflict.

In Tennessee, for example, we address issue/positional conflicts of interests in Paragraph [24] of our Comment to RPC 1.7.  While incapable of being that kind of conflict, supporters of the D.C. Opinion warning might argue that it is still a risky endeavor to express opinions about a legal issue because the lawyer might then have a “personal interest” in how something is resolved that would materially limit the ability to represent a client.

To me, that kind of approach to the topic not only misunderstands what it means to be a lawyer representing a client but also what the rules say in a variety of places it means to be a lawyer at all.  I’ll stick for now to just the Tennessee rules though I’d venture a guess that similar principals are laid out in D.C.’s rules.

In the Preamble to our Rules, in the second paragraph, we lay out a list of things that a “lawyer” is and, included among them, is “a public citizen having special responsibility for the quality of justice.”  In the seventh paragraph of the Preamble to the Rules we say:

As a public citizen, a lawyer should seek improvement of the law, access to the legal system, the administration of justice, and the quality of service rendered by the legal profession.  As a member of a learned profession, a lawyer should cultivate knowledge of the law beyond its use for clients, employ that knowledge in reform of the law; and work to strengthen legal education.

Further, we have a rule, RPC 6.4, patterned after ABA Model Rule 6.4, that specifically makes the point that lawyers can ethically undertake service in connection with entities that seek to reform the law or its administration even though such efforts could detrimentally affect the interests of a client of the lawyer.  If a Tennessee lawyer can engage in organized efforts to reform the law even though those efforts, if successful, might detrimentally affect the interests of one of the lawyer’s clients, then absolutely they can make public statements about what the law should be without violating the ethics rules.

Now, might a client decide not to hire a lawyer who has already indicated a personal belief contrary to the client’s position.  Sure, and they’d have every right to make that decision.  But they might also make a different decision and think that, if the lawyer is willing to take on and argue their position despite past public statements to the contrary, it would make their arguments stronger.

To my knowledge. opinion-writing entities have never warned lawyers about writing learned treatises or books on legal subjects or discouraged lawyers from speaking at Continuing Legal Education events or seminars (which are these days often videotaped and archived) because of some notion that expressing an opinion about a legal issue could create an ethical conflict for the lawyer.  Seems to me that the same “logic” that drove the almost offhand reference by the DC Bar in the Ethics Opinion could be applied to tell lawyers to “beware” of such other activities as well.

One thing I hope everyone could agree upon though is: if you are going to go to the trouble of injecting this issue into what is otherwise an extremely lengthy ethics opinion, then you should have done a better job of tackling the issue comprehensively rather than simply throwing out a half-baked statement that could serve to dissuade lawyers from speaking out.