Remember my conversation with the SuperShuttle driver?

A while back I wrote a piece about a relatively deep conversation I had about right and wrong and why lawyers do some really bad things with a SuperShuttle driver in Phoenix.  If you missed it, you can read it here.  But one of the things I didn’t say during that conversation was that there are some people out there who are:  just.the.worst.  Some of them end up lawyers.  And when they do, hoo boy.

I imagine if I asked the driver to paint the picture of someone who he would consider the worst possible lawyer of any of the truly rotten apples,then he’d probably say it would be someone who steals money, lies, is disrespectful, rude, vindictive, a bully, and maybe even something of a racist/misognynist/homophobe.  It is probably less likely that the driver would even think to also say that he blabs about privileged communications, but maybe he’d think to make that point as well.  Well, this Indiana lawyer who just got disbarred the first day of this month reads like he came straight out of central casting for the part.

I bet lots of people will be writing about this character, or already have written about him ( I promise I’m not lying when I say I haven’t gone looking for or read anybody’s take on this guy yet beyond the ABA Journal story here that got it on my radar screen).

I’m writing about him right now because I’m lazy.  My seminar season is about to kick into gear starting tomorrow with an hour of ethics I am looking forward to doing for the Memphis Bar Association Labor & Employment section here in Memphis.  Between actual work and seminar season, I’m going to have to be highly efficient with content for the blog this month.

Go read the order in all its gory detail if you can manage it, or I can give you a pretty good feel for it with this snippet of the Court’s order:

The seriousness, scope, and sheer brazenness of Respondent’s misconduct is outrageous.  He stole approximately $150,000 from his clients, threatened and intimidated his staff, disparaged and mocked virtually everyone around him, lied to all comers, and obstructed the Commission’s investigation.  Perhaps most disturbingly, Respondent repeatedly and fundamentally breached the duty of confidentiality that lies at the heart of the attorney-client relationship.  Respondent recorded privileged conversations and shared those recordings with others for his own amusement, he solicited his office staff to do the same, and he posted client confidences and falsehoods on a legal marketing website in order to “punish” certain clients and inflate Respondent’s own website ranking.

There are some nuances to the guy’s situation – like manipulating online reviews and whether opinions like that New York one from earlier this year tempt that kind of behavior – that could merit some thoughtful exploration, but it doesn’t deserve to be done in the context of someone who appears to just be a horrible human being.

2 out of 3 ain’t bad – NC releases a threesome of ethics opinions on the same day

In a lot of jurisdictions, mine included, formal ethics opinions from the governing disciplinary body are issued, if not rarely, then on a “few and far between” kind of time frame.  In North Carolina, on October 23, 2015, 3 were released in one day.

Two of them provide overall good advice.  One of those two is particularly timely for lawyers given growing concerns about hacking and phishing concerns.  The other offers a very well-reasoned, and appropriately terse, approach to an ethics issue rarely made the subject of ethics opinions.  The third… well let’s hold off saying anything about the third until the end.

NC Formal Ethics Opinion 2015-6 addresses an array of questions that all emanate (more or less) from the same general scenario:  what are the professional responsibilities of a lawyer who, through no fault of his own, has been the victim of crime or fraud that depletes money in the trust account to a level in which all obligations can no longer be satisfied?  2015-6 is a pretty faithful application of the principles underlying RPC 5.1 and RPC 5.3 and reaches the conclusion, over and over again, that a lawyer who gets ripped off despite having in place reasonable measures to give reasonable assurance of compliance with the ethics rules by the other lawyers and nonlawyers in the firm, is not to be held responsible as an ethical matter for making payment of the amount lost as a result of the wrong doing of the third party.  The North Carolina State Bar stresses, as it should, that it is not opining about the potential for civil liability as between attorney and client (or third party who has entrusted funds in the attorney’s trust account) for the lost funds but is limiting itself just to questions of ethical responsibility.

The opinion gives what would serve as a good answer to almost all questions in this general area with its first answer — addressing a scenario where a third party has made counterfeit checks designed to look like they are for the lawyer’s trust account and used those checks to commit theft from the account:

If Lawyer has managed the trust account in substantial compliance with the requirements of the Rules of Professional Conduct… but, nevertheless, is victimized by a third party theft, Lawyer is not required to replace the stolen funds.  If, however, Lawyer failed to follow the Rules of Professional Conduct on trust accounting and supervision of staff, and the failure is the proximate cause of theft from the trust account, Lawyer may be professionally obligated to replace the stolen funds. . . .

Under all circumstances, Lawyer must promptly investigate the matter and take steps to prevent further thefts of entrusted funds.

The opinion essentially applies this same rubric to provide good answers to successive questions, such as whether the lawyer is liable if a hacker gains access to the lawyer’s computer system and causes an authorized electronic funds transfer to take place, and how the lawyer’s duty of reasonable care can require a lawyer to be wary of an email “spoofing” situation designed to result in causing the lawyer to think they are wiring funds to their client but actually wiring funds to someone else.  The opinion even offers practical guidance that, while perhaps not supportable under a strict reading of the ethics rules, makes good sense from a loss prevention standpoint and when we let ourselves remember that the ethics rules are rules of reason and should be construed as such.  Specifically, the opinion indicates that while the lawyer is pursuing and investigating other remedies for clients affected by a theft, the lawyer is permitted, despite the prohibition on commingling in RPC 1.15, to deposit his own funds into the trust account to replace stolen funds.

The second opinion, Formal Ethics Opinion 2015-7, addresses a variation of a question I’ve often been asked by lawyers: do “prior professional relationships” you’ve had outside of the practice of law count to permit in-person solicitation that would otherwise be prohibited by RPC 7.3?  The North Carolina State Bar explains that yes they do.  Specifically, the questioner in 2015-7 can so characterize her relationship with a health care professional someone with whom she developed a business relationship while working as a health care consultant.  In so doing, the opinion succinctly focuses on the heart of the issue — the reason justifying such a prohibition on in-person solicitation at all.   The prohibition exists to “prevent undue influence, intimidation, and over-reaching by the lawyer.”  Thus, certain types of prior relationships are exempted because it is considered “unlikely that a lawyer will engage in abusive practices” when they have those kinds of prior relationships.  The opinion acknowledges that the term “prior professional relationship” is “not limited to prior client-lawyer relationships” and finds the questioner’s situation to qualify.  (Historically, I have made this same point but more expansively by noting that the language of the rules knows how to say “former client” when it means to impose that limitation, as well as how to use other words that would carve out a more narrow exception than what is intended by “prior professional relationship.”

The third opinion, Formal Ethics Opinion 2015-5, actually gives the correct answer, but justifies its response using what I believe is clearly the wrong rule.  In so doing, it fails to even reference the rule that does justify the outcome.  The question the opinion addresses is:

Lawyer A is appointed to represent a criminal defendant in an appellate matter.  Subsequently, Lawyer A withdraws from the representation of the client and Lawyer B is appointed successor appellate counsel.

Must Lawyer A obtain the former client’s consent prior to discussing the client’s case with Lawyer B or prior to turning over the former client’s file to Lawyer B?

The opinion concludes that the answer is no — unless the client had previously specifically instructed Lawyer A to not speak with Lawyer B — but rests its conclusion on the concept that RPC 1.6(a) permits a lawyer to make disclosure of confidential information when “the disclosure is impliedly authorized in order to carry out the representation.”  The problem, however, is that the question makes clear that the first lawyer has already withdrawn from representing the client.  Thus, from the first lawyer’s perspective, there is no representation to carry out much less any disclosure that can be argued to be impliedly authorized for the purpose of carrying out the representation.

There is a justification in the ethics rules for the answer “no.”  RPC 1.16(d) addresses steps a lawyer must still perform after the termination of a representation.  The NC version of the rule tracks the ABA Model Rule in stating generally that:  “Upon termination of representation, a lawyer shall take steps to the extent reasonably practicable to protect a client’s interests….”  In Tennessee, we make the utlility of RPC 1.16(d)  as the answer to this question more obvious by providing a numbered list of six items that may be included, depending on the circumstances, in “protecting the client’s interests.”  The third item being “cooperating with successor counsel engaged by the client.”  Yet, even without that specific language, the NC rule’s general requirement of taking reasonably practicable steps to protect the client’s interest  is a much more justifiable way of validating the answer to the question presented in Formal Ethics Opinion 2015-5.

Coming to praise rather than to bury (Part 1 of 2)

For a change of pace, I write today about a very well constructed ethics opinion out of New York.  (To keep this positivity train chugging along for at least one more day, my plan for tomorrow is to discuss a federal court decision out of Florida impacting attorney ethics that is also praiseworthy and that should be fodder for challenging a similar prohibition on how lawyers can market themselves in my state.)

Last month, the New York City Bar released Formal Opinion 2015-6, addressing several unpleasant issues relating to duties to clients that a lawyer must wrestle with in already difficult circumstances, where an accident or disaster has destroyed a client’s file or where an accident or disaster has compromised the security of the client’s confidential information.  The opinion makes reference to a particular relatively recent event as an example of how this could happen – a February 2015 fire in a Brooklyn warehouse (presumably this one), that destroyed some attorney files among other private materials.  The committee also offers other examples where the loss of client files seems more like an afterthought compared to human tragedy involved, such as hurricanes and terrorist attacks.  In addition to offering guidance for (1) when a lawyer has to notify a current or former client about files being destroyed and (2) what a lawyer has to do after it has happened in terms of attempting reconstruction of a file, Formal Opinion 2015-6 also discusses the lawyer’s duty to notify about potential compromise of confidential information in such circumstances.

In a 2010 opinion, this same NYC Bar committee addressed when a lawyer could ethically destroy file materials after a case ended.  That opinion divided the world of a lawyer’s client file into 3 categories of documents: (1) documents having “intrinsic value” or that “directly affect property rights;” (2) documents the lawyer “knows or should know may still be necessary or useful to the client, perhaps in the assertion of a defense in a matter for which the applicable limitations period has not expired;” and (3)  documents that “furnish no useful purpose in serving the client’s present needs for legal advice.”

Echoing the treatment of the answer to “when can you destroy?” provided in the 2010 opinion, Formal Opinion 2015-6 says that as to Category 1 documents, absent a contrary earlier agreement between lawyer and client, the lawyer will have an affirmative obligation to notify the client about the destruction of such documents.  As to Category 3, the answer is as simple, albeit flipped – unless prior agreement to the contrary, no duty to notify.  Recognizing that most of the analysis about duty to notify flows one way or another from RPC 1.4 on a lawyer’s obligations to communicate with clients, the committee reminds that, if a client asks about their file in the wake of such an event, the lawyer’s ethical duty to respond to reasonable requests for information would entail promptly responding to the client to let them know of the inadvertent destruction even of such documents of “relatively little importance” as Category 3 materials.

As to Category 2 documents, Formal Opinion 2015-6 rightly recognizes that the blueprint provided in the 2010 opinion about post-representation destruction cannot be readily applied to a situation where such materials are destroyed during an ongoing client engagement.  Thus, if the client’s matter is still active, then the lawyer is going to have a duty to notify the client about destruction of Category 2 documents.  If the accident or disaster only has hit files for a closed matter, then the rubric from the 2010 opinion works and the lawyer has to undertake a determination about whether the “client foreseeably may need” the documents to decide what to do.  The committee, smartly, also makes the practical and prudent point that the safest route on Category 2 documents will always be to go ahead and notify the client of the inadvertent destruction.

Turning to any duty to reconstruct the file, the committee explains that the lawyer will have to first assess whether any of the files destroyed are still “needed to continue providing competent and diligent representation on open matters” and, if the answer is yes, then “the lawyer must make reasonable efforts to reconstruct the destroyed file.”  By, for example, trying to get copies of documents that would have been in the file from the court, co-counsel, opposing counsel, or the client herself, or some combination of those or similar sources.  Formal Opinion 2015-6 then indicates that when the duty to attempt to reconstruct has been triggered, a lawyer who is unable to do so sufficiently to be able to continue to provide competent and diligent representation would be obligated to notify the client of that inability.

If I can quibble with the committee in just one respect it would be that this would have been a good place to expand upon the relationship between notifying about the destruction and performing the reconstruction and the timing of those events.  For example, if the lawyer reasonably believes that they can almost fully reconstruct the file, can they get that accomplished first, quickly, and then provide notice to the client simultaneously of the prior destruction and the believed-to-be-successful reconstruction?  Or does the committee mean to say truly that the timing is such that the lawyer must inform of the destruction before the lawyer will know of any chance of success in reconstructing to be able to continue the representation appropriately?

Finally, Formal Opinion 2015-6 correctly answers the question about a lawyer’s duty to notify clients of the potential compromise of confidential information in the wake of such an accident or disaster.  Returning again to the Brooklyn warehouse fire example, and the clear visual impression of various papers scattered about around the fire scene such a scenario provides, the committee explains that when the duty to notify of destruction would arise so too will the lawyer face a duty to notify clients that confidential information may have been compromised.  If I am permitted to quibble with just two items, this would be the second one.  The committee appears to imply that the duty to notify of compromise confidential information wouldn’t apply to Category 3 documents, but I’m dubious that any differentiation on categories would be as justifiable on the question of potential exposure of confidential information to third parties.

While addressing only accidents and disasters, it is not difficult to see how this opinion’s analysis of the duty to notify of compromise of confidentiality would be the same if the question instead was one of digital disaster — an electronic data breach at a law firm.  And, along those lines, another question that the committee leaves unaddressed as beyond the scope of its current effort — “the extent of a lawyer’s duty to take affirmative steps to protect confidential information in anticipation of a disaster” — is even more challenging to contemplate as to data breach.  Formal Opinion 2015-6 at least hints in fn 3 at possible ways to anticipate and protect against physical destruction of file through accidents or disasters – off-site storage of backup tapes and cloud storage.  The answer to what will come to be expected of lawyers and law firms in trying to anticipate and protect against data breaches will, no doubt, be addressed by this or another committee (or twelve).

Hopefully, a consensus will develop around an acknowledgment that while it is generally quite true that an ounce of prevention is worth a pound of cure, it is equally if not more correct that:

Sometimes there is nothing you can do. – Neil Gaiman, Neverwhere

 

Your IT pro is your best friend, but can’t always protect you from fraud.

Last week I was confronted with another example of how valuable excellent IT professionals can be for practicing lawyers.  As routinely happens, our firm’s spam filter trapped a significant number of emails last Wednesday. Because legitimate email sometimes gets wrongly blocked or filtered, our IT folks also review what gets caught in the filters.  Last Wednesday, our IT gurus noticed an email that, if given the benefit of the doubt, could potentially be a legitimate effort by a lawyer in another state to share with me a document through a well-known online document sharing service.

I was asked by our IT department if I recognized the sender and whether the email address being used was legit.  I did and it was, but there were still enough peculiarities about the details of the email that the IT folks were skeptical about whether it was legitimate or the result of hacking or spoofing.  Although this lawyer might very well have a reason to be in touch with me (I do have a blog read regularly by perhaps a dozen people after all), I had to admit that I wasn’t expecting to hear from this lawyer.  I agreed to send a new email to the person explaining what had transpired on our end and asking “did you mean to send me some documents through [high-profile service],” fairly quickly, a response came back from the person’s email address that was short and sweet:  “Yes i did.”

Now I was distracted by other aspects of what I was doing along with dealing with this issue and I really had not focused on the fact it was a little early in this person’s part of the world for them to be sending the first email and the fact that the response email was a little too pithy to be consistent with their personality, but the folks who handle IT for a living at our firm have a much more singular focus and not only weren’t distracted but were still quite concerned about details of the email and, most particularly, that one of the links in the email appeared to be pointing to an IP address in French Polynesia rather than to anything affiliated with the document sharing service.  Relying on that person’s expertise, it was easy for me to agree that it was more likely that the intruder who had hacked into this person’s email was sufficiently in control to be drafting replies sent to the email account then than (edit: and thx to a loyal reader for catching the error) that the lawyer had really tried to share a document with me using a file sharing service.

I’m relatively tech savvy and would like to think that, even without the involvement of the IT professional, I would never have clicked on a link that when hovered over didn’t look right, but having such high-quality IT folks in my corner made sure that I never even had the opportunity to make that mistake.

Unfortunately, not every situation is one where your IT folks can protect you from falling victim to fraud.

Much has been written online about financial scams targeting lawyers.  A few better pieces available online discussing various aspects of these issues can be found here, here, and here.  Gone are the days when such scams were as easy to see through as the Nigerian Prince emails.  Instead, common current scams involve contacts from companies that on paper actually exist  and that want to hire you to pursue litigation against someone who owes them money or to pay you to defend them in a case where they are accused of owing someone else money.  Once you agree to be hired, the case then quickly settles and the settlement proceeds flow through your trust account and you are instructed to quickly send the proceeds, minus payment for yourself of course, to the party owed the money under the settlement agreement whether that is your client or the other party (depending on the variation of the scam being deployed).  Any lawyer that acts too quickly, however, comes to find out that the funds were no good – money orders forged or wires reversed or checks bounce – and the lawyer is left holding the bag and trying to get out from under a hellish trust account deficit and inquiries from disciplinary counsel about RPC 1.15 compliance.

One iteration of this scheme involving forged money orders, shell companies on both sides controlled by the fraudsters, and with an interesting twist also involving hacking and spoofing of law firm email accounts can be studied in this story today from the ABA Journal and the indictment of a Texas lawyer who was on the criminal side (rather than the victim side) of such an endeavor.

In the unforgettable words of Roy Trenneman from The IT Crowd: “People.  What a bunch of bastards.”

Death and disbarment

Returning to the office from the holiday weekend, I noticed these two sad and weird stories of lawyers doing inexcusable things that seem to have common threads of death and disbarment running through them.  Many years ago I wrote a humor column for young lawyers. and you can find some of those columns still floating around the interwebs, like here (starting at p. 12) and here (starting at p. 18).  This blog will not stray from its purpose and attempt to be a humor column.  I promise.  Bleak stories do require some willingness sometimes to attempt to find humor in making serious points.  This is one of those times.

The first story involves a variation on a circumstance that many of us have experienced (or at least strongly suspected we might have experienced but were too kind to ever try to investigate lest we be wrong and come out looking like a horrible human being):  the opposing counsel who claims an illness or death in the family in order to get out from under some missed deadline or hearing we suspect they just aren’t ready to handle.  This now-former attorney has resigned or been disbarred by consent from two states on the basis of having lied in two cases.  One case involved the lawyer lying about having been in the ER diagnosed with “double pneumonia” to get a hearing on a summary judgment motion rescheduled.  In the other case, the lawyer lied about his mother having died as an explanation offered to avoid sanctions based on missed discovery deadlines.  His own billing records showed in the one case that he billed his client for time spent preparing for the hearing on the day of his claimed ER trip.  As to the second matter, while I generally agree with Judge John Hodgman that specificity is the soul of narrative, this lawyer likely didn’t help himself with the specificity he used when lying about his mother, who was quite demonstrably still alive, saying she died “in a violent car accident in the state of Colorado” and that the cause of death was “the fire and smoke inhalation from the resulting conflagration.”

The second story involves a now-former DC lawyer who unsuccessfully argued that the death of his aggrieved client during the disciplinary proceedings should prevent the lawyer from being disbarred.  The key misconduct in the case was that the lawyer had, while on disability inactive status, taken $1,500 from a police officer for legal services never provided and then refused to return the money to the client.  During the many, many years of the proceedings, the lawyer tried to have the charges against him dismissed on five separate occasions.  Many of the arguments put more stress on the “criminal” part of the “quasi-criminal” nature of disciplinary proceedings rather than recognizing the importance of “quasi.”  The DC lawyer unsuccessfully argued that he had a constitutional right to a speedy trial which was violated by the lengthy proceedings; and that his being suspended during the proceedings mooted the case for disbarment.  Most brazen, however, was his argument that the death of the aggrieved client in January 2012 meant that the case against him should be dismissed.  For support of that argument, the lawyer relied on cases in which a criminal defendant died during the prosecution of the case against him.  These arguments were not wieners (a play on words that only makes sense if you’ve visited the link and learned the lawyer’s name) and the lawyer has been disbarred.