The Greening of New York

As promised, though just under the wire, I am following up to write more about one of the stories I didn’t write about in July, the issuance of N.Y. State Bar Ass’n Committee on Prof’l Ethics Op. 1225.

One of the downsides of publicly announcing you will write about something in the future is the risk that other folks will do it sooner and better. I understand that two of my favorite legal ethics sites have done so, but I’ve made the personal sacrifice to not read any of those folks until I can manage to commit my own thoughts into the ether.

So, let’s start with where we left off… Op. 1225 gives the ethical “green”light to lawyers both to advise businesses on how to comply with New York’s new law legalizing marijuana for recreational use and to personally use marijuana and grow the limited amounts authorized for personal use.

In getting to that conclusion, the NY Committee wasn’t starting from scratch but building on a foundation it had established in earlier opinions addressing a lawyer’s ability to provide advice to clients at an earlier time when New York only had legalized marijuana for medical use.

This opinion is noteworthy still, however, for several reasons.

First, I believe this to be the first ethics opinion clearly stating that a lawyer in a jurisdiction where recreational marijuana has been made legal can partake just as any other citizen of the state and that prohibitions in the ethics rules on personal conduct that is illegal should not change the outcome despite the fact that use of marijuana remains illegal under federal law. (I could be wrong about it being the first, but my memory is that other jurisdictions that have been willing to say that a lawyer can advise a client about the kind of business have still been unwilling to take the next logical step and say that the lawyer can partake.) It also makes the point that the now near full decade of federal forbearance on attempting to enforce federal law prohibiting marijuana use in states where it has been legalized could provide a lawyer with a good faith argument that no valid obligation exists to comply with the federal law in the face of the state legislative action.

On that front, however, it is worth knowing that the persuasiveness of the rationale likely could turn on what is the exact language of any particular jurisdiction’s version of Rule 8.4(b), the language of its accompanying comments, and what the ruling body considers to impact a lawyer’s “fitness.” For that matter, opening the door to the defiance of federal law by lawyers based on a claimed good faith belief of no valid obligation can itself be the stuff of slippery slopes.

Second, this opinion offers a very thorough explanation of why Rule 1.2(d) simply should not be interpreted in a fashion that would prohibit lawyers from offering businesses the assistance they would need to navigate the commercial endeavors that will be allowed. And it does so without feeling like any revision to the rule or comment is needed unlike some other jurisdictions have approached matters. A fundamental truth about the modern United States is that it is difficult, if not impossible, to navigate any regulated business without the assistance of lawyers.

More generally, in a complex regulatory system where cultivation, distribution, possession, sale and use of a product are tightly regulated, legal advice and guidance has immense value. Without the aid of lawyers, the recreational marijuana regulatory system would, in our view, likely break down or grind to a halt. The participation of attorneys thus secures the benefits of the Recreational Marijuana Law for the public at large, as well promotes the interests of the private and public sector clients more directly involved in the law’s implementation.

Unlike New York’s common sense acknowledgement of the overall public good, the Georgia Supreme Court just issued guidance turning a blind-eye to those concepts and declaring that lawyers that help clients do business in selling medical marijuana oil, despite that being legal, can be sanction for violations of the disciplinary rules because of the illegality under federal law.

Third, in delving into the attorney’s other question about accepting an equity interest in a marijuana business client, the committee opinion provides excellent guidance that would be useful for any attorney addressing the question with respect to any business client — an analysis of Rule 1.8 regarding business transactions and Rule 1.7 regarding conflicts of interest– which is a nice change of pace.

Now, off to go read the other folks, possibly better takes…

California proposes an ethics opinion that needs further workshopping.

Let’s talk for a bit today about a proposed California ethics opinion for which public comment is being accepted until June 8, 2021.

The general topic when you hear about the proposed opinion is immediately of interest — can a lawyer help a client obtain a contractual agreement including a provision that is against the law? It is a topic that I did a seminar on – unrelated to California law — back in the before times. (I think it is still available for listening if anyone is of interest here.)

In jurisdictions that have a version of RPC 1.2 that tracks the Model Rules, it can be a bit easier of a question to parse through because what ABA Model Rule 1.2(d) prohibits is limited to not counseling “a client to engage, or assist a client, in conduct that the lawyer knows or reasonably should know is criminal or fraudulent. . . .” Thus, tricky questions about whether a contract provision might be unenforceable under current law become a bit easier to deal with in terms of a bright-line at least because it is only problematic for the lawyer to be involved if the client’s path involves criminal conduct or the commission of a fraud on the other contracting party.

Although California has relatively recently (and finally) adopted a version of ethics rules that are patterned on the Model Rules, their version of RPC 1.2(d) deviates significantly from the Model Rule approach by expanding the lawyer’s obligation to include not just something that is criminal or fraudulent but anything that the lawyer knows is “a violation of any law, rule, or ruling of a tribunal.”

Thus, this proposed formal opinion (Interim No. 19-00003) addresses a much broader question than might be evaluated in most jurisdictions. Now, perhaps as a way of making the outcome more palatable, the opinion tees up the following as the fact pattern it decides to evaluate:

Lawyer works for a large California corporation providing employment law advice to the Human Resources department (“HR”) responsible for all non-executive hiring. Employees hired through HR are presented with a standard form written employment agreement (“Agreement”). This Agreement is presented by HR to new hires as a non-negotiable agreement that must be signed as a condition of employment. Lawyer is tasked with reviewing and updating the Agreement, which contains a provision that has been found to be illegal under California law.

Factual Scenarios

1. Lawyer knows that the provision has been found to be illegal, but advises HR to use the Agreement anyway, without further advice or analysis.

2. Same facts, except that Lawyer does not know that the provision is illegal.

3. Same facts, except that Lawyer advises that the contract provision has been found to be illegal under California law, but does not recommend against including the provision.

4. Same facts, except that Lawyer advises that the contract provision has been found to be illegal under California law and recommends against including the provision. HR advises Lawyer that it understands the provision is illegal but would still like to include it in the Agreement for its chilling effect. HR has asked the Lawyer to assist in enforcing the provision.

Offering up that scenario makes it a lot easier to offer conclusions such as:

A California lawyer has a duty not to counsel or assist a client in conduct that the lawyer knows is criminal, fraudulent, or a violation of any law, rule, or ruling of a tribunal. That conduct includes the use of a contract provision in a transaction with a third party that has been found to be illegal under the law of the jurisdiction applicable to the transaction. If the lawyer knows that the provision is illegal, the lawyer: (1) should advise the client accordingly; (2) may not recommend the use of the provision; and (3) must counsel the client not to use it.

If the client insists on the use of the illegal provision against the lawyer’s advice, the lawyer may not participate in presenting the illegal provision to the third party and may not assist the client in enforcing the provision. In that event, the lawyer may withdraw from the representation but is not required to do so.

If the lawyer concludes that the conduct is a violation of law reasonably imputable to the organization and likely to result in substantial injury to the organization, the lawyer for an organization must report the actions of the client constituent to a higher authority, unless the lawyer reasonably concludes that it is not in the best lawful interest of the organization to do so

Confined to the facts evaluated in the opinion, it would feel hard to get worked up about the conclusions because who wants to openly advocate for a corporation being able to knowingly put an unenforceable noncompete or nondisparagement provision in an employee contract merely for “its chilling effect”? Right?

But, work with me here for a minute. RPC 3.1 in most places, including California, expressly permits lawyer to advocate in court proceedings for extensions, modifications, or reversals of existing law. Court matters don’t happen without cases or controversies and, thus, cases arguing that aspects of existing state law, whether contract law or otherwise, should be modified or reversed unless people take actions that are “illegal” until litigated and the existing law reversed.

So, how in the world does that ever get to happen in California, if this ethics opinion moves forward? How does a lawyer help someone who is willing to seek to change a bad law to do so? Is California really going to say that the only way to do that is through lobbying legislative bodies? What if California had a law on the books that made it “illegal” to rent any house greater than 2,000 square feet in size to anyone other than Caucasians? And I’m not talking about something where the law in question makes it a crime, but just a statute that prohibits it without imposing any criminal penalties. Are California’s ethics rules going to prevent a lawyer from assisting a willing landlord in crafting a lease agreement that violates that law?

And, look, I get that the opinion is constrained in that it has to interpret California’s rule, and that it might well be that the problem is the rule itself, but, sometimes the process of putting together an ethics opinion reveals a bad rule and instead of issuing the opinion, someone should spend their time fixing the rule.

If you agree, and you have any sway in California, you can send a comment in on the proposal in the next 45 days or so.

Bad judgment leads to bad judgment.

A Tennessee disciplinary matter has made some national news this past week, so what I am writing about might be something you’ve heard about already.

It involves a Tennessee lawyer who has been given a 4-year suspension from practice, with one-year of active suspension for providing advice over Facebook to a woman about how she could potentially kill someone but make it appear to be self-defense and who advised that woman to delete the evidence from Facebook if she was serious.

Incredibly bad decision-making, obviously unethical conduct, and something that certainly is very deserving of punishment. I want to make all of that clear up front because I’m here otherwise to offer a pretty contrarian take on the opinion that the Tennessee Supreme Court put out explaining the outcome.

Before I do that though, and in case you hadn’t read anything at all about the case elsewhere, here is the gist of the relevant facts of the conduct itself taken from the Court’s very good summary, starting with its second sentence:

The attorney had a Facebook page that described him as a lawyer. A Facebook “friend” involved in a tumultuous relationship posted a public inquiry about carrying a gun in her car. In response to her post, the attorney posted comments on the escalating use of force. He then posted that, if the Facebook friend wanted “to kill” her ex-boyfriend, she
should “lure” him into her home, “claim” he broke in with intent to do her harm, and “claim” she feared for her life. The attorney emphasized in his post that his advice was given “as a lawyer,” and if she was “remotely serious,” she should “keep mum” and delete the entire comment thread because premeditation could be used against her “at trial.”

I started with the second sentence and not the first because the first sentence says: “This case is a cautionary tale on the ethical problems that can befall lawyers on social media.”

Well, it is now because the Tennessee Supreme Court decided to make it into one and to make that the most important thing that they have decided to emphasize. Why that was how the Court decided to frame this eludes me a bit.

This lawyer’s situation wasn’t one where he was merely interacting with people on social media without touting himself as a lawyer and without wading into the explicit giving of legal advice. That’s important to note at this moment in our nation’s history in particular as lots of robust debates are being had about where one might draw the line on the intersection of attorney ethics rules and First Amendment rights of lawyers. The Court’s opinion — as a result of its overall focus — offers some words that likely will only be capable of being read as having a very chilling effect on online speech. (More about that in a minute.)

The Court could have focused on what this situation fundamentally was – an instance of a lawyer doing at least two things that are absolutely antithetical to what it means to be a lawyer: (1) giving legal advice to people designed to help them commit crimes and get away with it; and (2) giving legal advice to people about how to destroy evidence.

Instead, the Court puts an exceedingly high amount of emphasis on the fact that this interaction occurred on social media because these posts, made publicly, “fostered a public perception that a lawyer’s role is to manufacture false defenses. They projected a public image of corruption of the judicial process.” The Court even almost exclusively justifies its decision to change the original outcome of the disciplinary proceedings from a 60-day suspension to a 4-year suspension on treating the lawyer’s having done this on public social media as an aggravating factor. In so doing though, the Court drops a footnote to say that it didn’t know, and it didn’t matter, whether the person being given the advice had made their Facebook page public or private. (If it was going to go down this path, it should have gotten an answer to that question because it does in fact matter.) In so doing, the Court also avoids acknowledging that, on some level, if the lawyer had sent the legal advice to the person via a private Facebook direct message then that conduct actually might have been worse on the whole.

Admittedly, the lawyer’s self-representation before the Court in these proceedings did not help much. He continued to struggle with admitting the gravity of his errors, persisted in trying to say he was fundamentally joking in his statements, and only made the point about the distinction between a private message and a public “wall” post in trying to claim that he couldn’t have really been serious or he wouldn’t have made the statements so publicly. But still, in the end, there is something deserving of real thought about whether a lawyer who does something like this in daylight where others can see is actually doing something worse — in the way that the Court views it — then a lawyer who does something like this but better covers their tracks.

And, in having this laser-like focus on the social media component of this galling conduct, the Court also ends up – at least in the opinion of one Justice — issuing an opinion that is more dicta than opinion. Justice Lee filed a separate opinion, concurring in the judgment and concurring in the section that evaluated why the 60-day punishment was insufficient – but not joining the rest of the opinion. In it, Justice Lee explains that in the posture the case arrived — not appealed by the lawyer or by the Board of Professional Responsibility — the Court could only evaluate the appropriateness of the level of discipline. Thus, all of the Court’s discussion about other matters, including all the reasons why the lawyer’s communications did violate RPC 8.4(d) was, in Justice Lee’s view, just dicta.

If all of those sections are dicta, that does help tamp down concerns that the Court analyzed this situation so thoroughly and never referenced the need for lawyers to understand that this likely was not just a violation of RPC 8.4(d), but truly likely was a violation of RPC 1.2(d) [“A lawyer shall not counsel a client to engage … in conduct that the lawyer knows or reasonably should know is criminal…] as well as a violation of RPC 1.6 because the lawyer essentially disregarded all notions of concern for confidentiality by having the entire interaction with this client on a Facebook wall. Not to mention, of course, a violation of RPC 3.4(a) for counseling someone to destroy or conceal potential evidence. (The lawyer was not charged in the disciplinary proceedings themselves with any violation of anything other than RPC 8.4(d) and the ubiquitous bootstrap charge of RPC 8.4(a)).

Whether or not Justice Lee is correct about the dicta issue does not help me any as to the piece of the opinion that I believe could have the most chilling effect on speech of any sort because it appears in the portion of the opinion addressing the appropriate disciplinary sanction which Justice Lee joined. Again, before quoting the problematic passage a reminder of the context, this was a situation in which the lawyer in question expressly touted the fact that they were a lawyer in their online postings and were clearly engaged in giving direct legal advice to a person, including advice to attempt to conceal or destroy evidence.

It was in that context that the Court chose to say this:

“[A]ttorneys in any setting — including on social media platforms — remain bound by our Rules of Professional Conduct. See In re Vogel, 482 S.W.3d at 545 (All attorneys licensed to practice law in this state have a duty to “act at all times, both professionally and personally, in conformity with the standards imposed upon members of the bar as conditions for the privilege to practice law.”). Lawyers who choose to post on social media must realize they are handling live ammunition; doing so requires care and judgment. Social media posts are widely disseminated, and the damage from a single ill-advised comment is compounded and magnified.

That is not say that the passage is not good, practical advice. The problem is that coming out of the mouth of the Tennessee Supreme Court it must be given greater weight than being just good, practical advice. Attorneys in Tennessee now have to be greatly concerned that the Court does not believe that there can be any separation in terms of online speech between the personal lives of lawyers and their professional lives.

For reference, the Vogel case cited by the Court was not a disciplinary proceeding involving anything that a lawyer was doing personally rather than in their role as a lawyer. Vogel involved a lawyer who improperly disclosed confidential information of a former client and engaged in a sexual relationship with a client during the representation.

To use what was – with all appropriate respect — a throwaway line at the end of the Vogel opinion to appear to signal now that simply being a lawyer means that there can be no “purely personal” interactions online, nor any ability to comment on politics in a capacity outside of one’s law license, is an exceedingly troubling development.

Nebraska brings us … this.

It’s been something of a big month for Nebraska. First, thanks to its divided approach to providing electoral votes, it is contributing one of the electors totaling up to President-Elect Joe Biden’s 306 electoral votes. Second, like everywhere else in the United States (my state is doing just as bad if not worse) unfortunately, it has seen its COVID-19 numbers surge in November.

Third, and relevant to this space, it has issued an ethics opinion of note. It deserves a bit of discussion because it takes what could be a very interesting topic – one I have counseled people through in the past – and manages to make it not interesting at all. Moreover, it effectively avoids addressing the core issue on which lawyers actually need guidance.

The opinion in question – Nebraska Ethics Advisory Opinion for Lawyers 20-02 – offers an answer to the following question:

May a person/entity or group of defendants who are parties to pending litigation in a district court lawsuit brought by a plaintiff who is a trustee of a trust recommend a list of attorneys and pay for the non-party trust beneficiaries’ legal services needed to bring a county court action to
remove the trustee?

Ultimately, it only sort of answers that question because it points out that it can only give advice to lawyers and not litigants and so, instead, really just provides a refresher on the ethical obligations that a lawyer generally is going to have when they get retained to represent one person, but some other person is paying their bills.

Which is fine. But the world has a pretty good amount of guidance on that topic already. Given the actual question, this kind of ethics opinion would have been a tailor-made opportunity to address the ethics of being a lawyer who has a client who wants you the lawyer to help them secure a lawyer for someone else because the client thinks it is in the client’s best interest for that person to be represented by a lawyer.

One way the issue can come up is when a company wants to hook up a former employee with counsel. Wrestling through the ethics issues for the lawyer in that situation can be tricky as much of the analysis can turn on who came up with the idea and why they want to pursue it.

The closest that the Nebraska opinion comes to providing any sort of pointer toward guidance relevant to those questions is where it explains:

To the extent the question presented can be framed as whether the lawyer representing the litigants can recommend the hiring of another
lawyer, the Committee believes §3-508.4 applies. “It is professional misconduct for a lawyer to: (a) violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another.” As long as the lawyer representing the
defendants in the lawsuit brought by the trustee does not induce another lawyer to violate the ethics rules, the defendants’ lawyer has not committed an ethics violation.

Nebraska’s version of RPC 8.4(a) is patterned after the ABA Model Rule version and, thus, that can be a generally helpful pointer. But there are other risks floating around for the lawyer, even if it is their client who truly, independently came up with the idea of trying to hire a lawyer for their former employee.

One risk for the lawyer is if what is motivating the client is a desire to make the former employee “off limits” from informal communications with the opposing party because of the application of RPC 4.2. If that is in the mix, the lawyer may have to be concerned about whether the client is trying to get the lawyer to circumvent the prohibition in RPC 3.4(f) regarding requesting someone to voluntarily refrain from giving relevant information to another party. Lining up and paying for counsel for a former employee is always a safer proposition if what has prompted the idea is that the deposition of the former employee has been noticed.

Another risk for the lawyer (actually two different risks) is if the client wants the lawyer to also take on the former employee as a client rather than hire a different lawyer for that former employee. In addition to the conflicts issues the lawyer has to muddle through about that idea, if the lawyer is the one that is going to be foisted upon the former employee as a proffered free-of-charge counsel, then the lawyer also has to worry about application of the jurisdiction’s rules on solicitation of potential clients. Navigating that path very much drives home the point of the risk associated with RPC 8.4(a) – and not with respect to inducing some other lawyer to violate the ethics rules as the Nebraska opinion briefly mentions – but with respect to violating the rules “through the acts of another.”

And, at each stage, an additional ethics rule lurks in the background – RPC 1.2(d). That’s the rule that simultaneously prohibits lawyers from assisting clients in criminal or fraudulent conduct while attempting to make clear that lawyers are entitled to advise clients about all of their legal rights and the consequences of certain actions. In this context, it is the rule that means that if the client is the one that comes up with the idea, then the client may well be entitled to hear from their lawyer whether they have the right to try to make counsel available at no charge to a former employee and have a “discuss[ion of] the legal consequences” of that proposed course of conduct.

An ethics opinion offering guidance to lawyers navigating that kind of situation would be something that – if done right – lawyers in Nebraska and elsewhere would likely have found to be very helpful.

So, my question, dear readers, is this: does anyone out there know if a state has issued any kind of guidance like that? Hit me up and let me know if there is.

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.

The ethics of putting together an unenforceable contract.

It is still astounding (as well as deeply dispiriting) that the context of the discussion I’m about to launch is the work of White House Counsel but this is the world we currently occupy.  You may very well have read this fascinating The Washington Post article by now released in connection with the ongoing news story of a former White House staffer who repeatedly secretly taped conversations – including her own firing in The Situation Room — inside The White House and what those recordings may reveal about whether that person says even more outrageous things in private than the outrageous things he says in public, as well as whether that person is suffering from a decline in his mental faculties.

Because tackling the notion of the ethics of representing a client with diminished capacity if that client happens to be – at least theoretically – the most powerful politician on the planet – is too depressing to tackle, I’m not writing about that today.  If you want to delve into those issues, your starting point is ABA Model Rule 1.14.

Instead I want to talk about [as the title of the post telegraphed] what can be a thorny ethics issue even in much more pedestrian contexts: is it ethical for a lawyer to draft and create a contract for a client’s use that the lawyer knows to be unenforceable?

As the topic du jour the context of the question is requiring staff at The White House – public employees — to sign non-disclosure agreements including provisions that would prohibit them from disparaging the 45th President of the United States.  Seemingly everyone acknowledges that given the nature of public employment, democracy, the at-least-still-for-the-time-being cherished concept of transparency in government, and numerous other federal laws such an agreement is obviously and undisputedly unenforceable.  The article describes what the media has been told about the events:

A number of White House aides were urged to sign NDAs in early 2017 by White House Counsel Donald McGahn, according to current and former aides, who requested anonymity to discuss internal West Wing deliberations. Trump was obsessed with leaks to the news media and repeatedly demanded that McGahn draft the agreement, the aides said.

Initially, McGahn told Trump he would not draft or give aides the NDAs because they were not enforceable, White House officials said. But in the end, McGahn created a document that said aides would not divulge any confidential or nonpublic information to any person outside the building at any time, according to three people who signed it.

Other media outlets have reported that McGahn may have convinced people to actually sign the document by reassuring them that it was unenforceable.  One of the reasons the question is important ethically is that if you create a contract for a client that you know is unenforceable, they will likely still try to use that contract in the future against people and cause them harm (at the very least economic harm and inconvenience associated with defending a lawsuit seeking to claim a breach of the unenforceable contract).  Media reports today indicate that something like this is now being undertaken – although admittedly apparently based on an NDA that was required by the campaign and not the actual government.

My opinion about the answer to the question of whether any such conduct by a lawyer is unethical is, unfortunately, less than equivocal.  At heart, it will have to turn on a situation-by-situation analysis.  Using the Model Rules to explain, this is because there is not exactly a specific rule outside of the litigation context that flatly prohibits a lawyer from assisting a client in pursuing a frivolous position in negotiation of a document in the same way that there is such a rule prohibiting the pursuit of frivolous claims in litigation.

What is available is a collection of rules that would need to be sifted through and applied to the circumstances to reach a conclusion about the lawyer’s role in assisting a client in getting someone to agree to a provision in a contract (or an entire contract) that is known to be unenforceable.  Those rules are:

RPC 1.2(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.

RPC 1.16(a):  … a lawyer shall not represent a client or, where representation has commenced, shall withdraw from the representation of a client if: (1) the representation will result in violation of the Rules of Professional Conduct or other law ….

RPC 4.1:  In the course of representing a client a lawyer shall not knowingly: (a) make a false statement of material fact or law to a third person; or (b) fail to disclose a material fact when disclosure is necessary to avoid assisting a criminal or fraudulent act by a client, unless disclosure is prohibited by Rule 1.6.

RPC 4.3:  In dealing on behalf of a client with a person who is not represented by counsel, a lawyer shall not state or imply that the lawyer is disinterested. . . . The lawyer shall not give legal advice to an unrepresented person, other than the advice to secure counsel, if the lawyer knows or reasonably should know that the interests of such a person are or have a reasonable possibility of being in conflict with the interests of the client.

RPC 4.4(a):  In representing a client, a lawyer shall not use means that have no substantial purpose other than to embarrass, delay, or burden a third person ….

RPC 8.4(d):  It is professional misconduct for a lawyer to … engage in conduct that is prejudicial to the administration of justice.

Assuming that, at all times in dealing with the members of staff being asked to sign the contracts, White House counsel was truthful about the situation, then the most troublesome provisions from the list above would be RPC 4.4(a) as there seems no “substantial” purpose other than to burden these people to seek to have them agree to an unenforceable contract — particularly where one of the grounds of unenforceability in this scenario is a constitutional issue.

In other circumstances, for example, where the unenforceable piece of the contract puzzle is just one part of an otherwise enforceable contract or, on the other extreme, where the contract itself is unenforceable because its purpose is inherently criminal or illegal, then the interweaving of these rules may provide a clearer outcome.

Texas Ethics Opinion Offers Stellar Example of Why You Ought to Have a Rule About This.

I’ve mentioned in the past the fact that Tennessee has a version of RPC 4.4(b) that directly addresses, and provides what I happen to think is the correct outcome, for what a lawyer is supposed to do about the receipt of someone else’s confidential information either inadvertently or via someone who isn’t authorized to have it in the first place.  Our RPC 4.4(b) goes further than the ABA Model Rule in two respects on this front in that: (1) it doesn’t just require notice as to inadvertently received information but makes clear that the lawyer has to either abide by any instructions as to what to do with the information or has to refrain from doing anything further with it until a court ruling can be obtained; and (2) we apply the same standard to information received unauthorizedly, e.g. a purloined document.  (Of course, I’ve also mentioned … repeatedly I admit … that the ABA Model Rules ought to be construed via Model Rule 1.15 to fill the gap on that second point, but … leading horses… and drinking water… and all that.

Earlier this month the State Bar of Texas Professional Ethics Committee issued Opinion 664 which “addresses” the following two questions:

1. Do lawyers violate the Texas Disciplinary Rules of Professional Conduct if they fail to notify an opposing party or its counsel that they are in possession of confidential information taken from the opposing party without the opposing party’s knowledge or consent?

2.  Do lawyers violate the Texas Disciplinary Rules of Professional Conduct if they fail to notify an opposing party or its counsel that they have inadvertently received confidential information of the opposing party?

In a relatively short opinion that discusses almost exclusively the first question, the Texas Committee ultimately says, “hey look, we don’t have a rule on any of this… so you are kind of on your own.”  That’s not really a quote from the opinion, of course.  The real quote from the opinion is longer but the gist is pretty much exactly the same as my fake quote.

The opinion then goes on to hold out the possibility that if you have this fact scenario plus something more than maybe one or more other rules could be violated — like Texas’s equivalents of Model Rule 1.2(d) or or Model Rule 3.3(a) or Model Rule 4.1 or Model Rule 8.4(d).  Quoting the opinion this time for real:

It is possible that under some circumstances the failure to provide notice to opposing counsel, or take other action upon receipt of an opponent’s confidential information, might violate one or more of the Texas Disciplinary Rules requiring lawyers to be truthful and to avoid assisting or condoning criminal or fraudulent acts or denigrating the justice system or subverting the litigation process.

The opinion also reminds readers that the lawyer’s course of conduct in such circumstances must be well thought through because the risk of disqualification still lurks, but in the end the opinion largely concludes with something that is mostly a restatement of the problem for Texas lawyers (and of my general inability to get horses standing so close to water to drink since Texas does have a version of ABA Model Rule 1.15  and confidential information certainly is “property”):

The Texas Disciplinary Rules of Professional Conduct do not prescribe a specific course of conduct a lawyer must follow upon the unauthorized or inadvertent receipt of another party’s confidential information outside the normal course of discovery.

The insistence on referencing discovery and, thus, making it seem like this is solely a problem for litigators rather than all lawyers is also a bit unfortunate.

Following up on that follow up

I probably should have taken the opportunity to say so in my last post – by way of contrast if not context — but one very obvious reason that the Ohio Supreme Court was able to move so quickly to adopt a revision to its RPC 1.2(d) to address its medical marijuana situation for lawyers is that it isn’t the first U.S. jurisdiction to opt to tinker with the some aspect of that rule in response to the issue.

Vermont recently, but after a much longer period of contemplation, chose to address the issue not by changing the black letter of its rule, but by adding a new paragraph to its comment to RPC 1.2.  After the revision, which happened in August 2016, Vermont’s Comment to RPC 1.2 provides the following explanation:

[14]  With respect to paragraph (d), a lawyer may counsel a client regarding the validity, scope, and meaning of Title 18, chapters 84, 84A, and 86 of the Vermont Statutes Annotated, and may assist a client in conduct that the lawyer reasonably believes is permitted by these statutes and the rules, regulations, orders, and other state and local provisions implementing the statutes.  In these circumstances, the lawyer shall also advise the client regarding the potential consequences of the client’s conduct under related federal law and policy.

The structure of that paragraph ought to sound familiar because — other than the references being to the Vermont statute instead of the Ohio law — it reads pretty much the same as the language that Ohio grabbed for use in its new RPC 1.2(d)(2).

Ohio’s other change, the move from using the word “criminal” to the word “illegal” in RPC 1.2(d) is still puzzling.  I still haven’t stumbled upon a good answer to my question why the Ohio court did that and what it thinks the distinction there would be.

Vermont’s approach to this issue though raises a question of a different variety altogether: how close does a change like this come to running afoul of the principles in the rules themselves about the purpose of Comments to the black-letter rules?

In Vermont, as in most states that have a version patterned after the ABA Model rule, the explanation as to the role of comments appears in the “Scope” section of the Rules and is as follows:

The Comment accompanying each Rule explains and illustrates the meaning and purpose of the Rule…. The Comments are intended as guides to interpretation, but the text of each Rule is authoritative.

Given that the black-letter of the rule being modified in Vermont reads “”[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,” I do think Vermont’s addition of [14] to the Comment is an appropriate exercise in explaining and interpreting the black-letter of the rule rather than using the comment to change the meaning of the rule but can admit reasonable minds might disagree.

What I don’t think really anyone reasonable can disagree with is the sentiment offered in the “notes” offered in Vermont about this amendment:

Given the conflict between state and federal law, and DOJ’s current enforcement policy, this is an area in which advice from an attorney is critical and into which clients should not be forced to enter without counsel.  Similarly, lawyers should not face professional discipline for providing legal advice and legal assistance on such an important issue, especially when the alternative is to leave clients to proceed at their own peril.

Friday follow-up: Puff, puff, PA’s overreach

Couple of quick hits (pun wasn’t really intended but just sort of happened) for this Friday.

A little more than a month ago, I wrote about an ethics opinion out of Ohio that created a real dilemma for lawyers looking to advise businesses related to the medical marijuana industry that was going to become legal in Ohio on September 8, 2016.  Under the analysis in the ethics opinion, Ohio’s RPC 1.2(d) prohibited lawyers from assisting people with such business endeavors.

Moving with what seemed like an unusual amount of speed when it comes to rule-making endeavors (and entirely contrary to the conventional wisdom that pot slows things down), the Ohio Supreme Court has adopted a revision to its RPC 1.2(d) to specifically address the situation and permit Ohio attorneys to assist clients in this industry.  The new rule language reads:

(d)(1)  A lawyer shall not counsel a client to engage, or assist a client, in conduct that the lawyer knows is illegal or fraudulent.  A lawyer may discuss the legal consequences of any proposed course of conduct with a client and may counsel or assist a client in making a good faith effort to determine the validity, scope, meaning, or application of the law.

(2)  A lawyer may counsel or assist a client regarding conduct expressly permitted under Sub. H.B. 523 of the 131st General Assembly authorizing the use of marijuana for medical purposes and any state statutes, rules, orders, or other provisions implementing the act.  In these circumstances, the lawyer shall advise the client regarding related federal law.

Now, I totally understand the addition of (d)(2), though it is the kind of hyper-specific revision to the language of a rule that makes me cringe on the inside.  But, I don’t quite understand why the Ohio court changed the language of (d)(1) to replace “criminal” with “illegal.”  Wonder what that is all about exactly and what they would articulate to be the difference in those two terms?

About a week before I wrote about the Ohio marijuana opinion, I wrote at length about a South Carolina ethics opinion that served as an exemplar of the kind of ethics opinion I anticipated a number of other states might write about the problems with  Avvo Legal Services.  Well, this month another state has added its voice with an ethics opinion pointing out ethical dilemmas for lawyers that might look to do business with that service and similar services. Pennsylvania has issued Formal Op. 2016-200: Ethical Considerations Relating to Participation in Fixed Fee Limited Scope Legal Services Referral Programs.  Ironically though, I can’t help reading the Pennsylvania opinion as being a bit more of an indictment of certain kinds of thinking in our profession than it is an indictment of the ethics problems with Avvo Legal Services.

I plan to write about this Pennsylvania opinion in more detail later — and can’t give you a link to go read it yourself because Pennsylvania still tries to keep its ethics opinions limited to members-eyes only in the online world.  (That is, in and of itself, a weird and outdated way of thinking altogether but that too would be a topic for another day.)

For today, I’ll simply preview that the fundamental problem I currently have with the Pennsylvania opinion is that it overreaches and comes across as indicative of a line of inflexible thinking that seems to be entirely out of touch with what is actually going on in the marketplace and that is mostly antithetical to innovation altogether.

Let me offer one example to hopefully pique your curiosity if not whet your appetite, it comes from Section IX of the opinion, titled “Access to Legal Services” —

Operators of FFLS programs argue that “unbundling” legal services reduces the cost to clients, thereby making legal services more accessible.  Expanding access to legal services is, of course, an important goal that all lawyers, and the organized Bar, should support.  However, the manner in which these FFLS programs currently operate raises concerns about whether they advance the goal of expanding access to legal services.  Further, compliance with the RPCs should not be considered inconsistent with the goal of facilitating greater access to legal services.  Any lawyer can offer “unbundled” or “limited scope” legal services at, or even below, the rates described by an FFLS program, provided the lawyer can do so in a manner that complies with his or her professional and ethical obligations, including the obligation of competence (see RPC 1.1) and full disclosure of and informed consent to any limitations on the scope of the legal services rendered.  If a lawyer cannot fulfill those obligations working outside the scope of an FFLS program, he or she almost certainly would not be able to do so working within such a program.

Really?

Ohio ethics opinion is concrete example of “Tis better to ask forgiveness than permission.”

“It’s easier to ask for forgiveness rather than permission.”

Those words, or words of similar effect, make up a pretty widely recognized adage.  Depending on the details of any situation, the adage can serve as a proxy for pretty decent advice for a lawyer to give a client, but often less so if the lawyer’s client is also a lawyer.  The message itself, however, can be a pretty decent mantra to offer to lawyers who might be contemplating posing a question to a regulatory body that issues advisory ethics opinions.

I’ve previously written a few words on my love/hate relationship with ethics opinions issued by entities.  A lot of the time I find myself surprised that a lawyer would ask the question that a regulatory body says has been posed to it.  Occasionally, I am very glad that some lawyer did because the result is a helpful opinion that I and others can point to as guidance when advising other lawyers or can rely upon as arguably persuasive authority in one context or another.  Some times I really wish the question had never been asked because the opinion that gets produced really screws up the answer.

From time-to-time, I read an ethics opinion and reach a conclusion that the lawyer would have been better off just doing the thing and seeking forgiveness later rather than even asking the question.  Hello Opinion 2016-6 from the Board of Professional Conduct of the Supreme Court of Ohio.  It tackles the role lawyers in Ohio can or cannot play in that state with respect to the legalization of medical marijuana which is set to take effect next month in Ohio.

It has been more than a year ago now, but I wrote one time in the past about the thorny issues that can arise for lawyers from the growing trend at the state and local level of moving toward the legalization of marijuana while it continues to be illegal to grow, distribute, or use under federal law.  Thus, I can’t really take too much issue with the opinion writers who issued the Ohio opinion because I recognize the constraints they consider themselves to be laboring under to some extent, but the work product they have spun out is still unfortunate… if for no other reason than that it is counterproductive.

People trying to operate in this new business sphere in Ohio will have many land mines to navigate and desperately need lawyers to help.  They are going to do a whole lot better at avoiding unexpected difficulties or legal missteps if they have lawyers assisting them along the way.  By telling Ohio lawyers that this kind of work is off-limits, other people who are not constrained by lawyer regulatory issues will likely step in to fill the void.  Though I learned this morning from Karen Rubin over at her firm’s top-notch blog that the Ohio Supreme Court has already announced an effort to revise RPC 1.2 to address this issue, so maybe there will never be a gap created.

But the real problem here is that this is exactly the kind of question that should never have been posed this to the Board of Professional Conduct.  Perhaps there is no better way of showing why this is true than in highlighting how the Ohio Board addressed the fact that the Ohio legislature passed a statute immunizing professionals from liability for undertaking actions in compliance with Ohio state law on medical marijuana.  The Ohio Board offers no solace on that front:

The law immunizes professional license holders, including lawyers, from any professional disciplinary action for engaging in professional or occupational activities related to medical marijuana.  Notwithstanding this provision, this advisory opinion analyzes the questions presented in light of rules promulgated by the Supreme Court pursuant to Oh. Const. Art. IV, Section 2(B)(1)(g).

The Board dropped a footnote from that second sentence to quote the relevant provision — “The supreme court shall have original jurisdiction in * * * [a]dmission to the practice of law, the discipline of persons so admitted, and all other matters related to the practice of law.” — and raise the specter for a lawyer interested in helping a medical marijuana business of an intercine war between government branches with his/her license trapped in the middle.

The clearest lesson here for Ohio lawyers ought to be that when you really want helpful, practical, legal and ethical advice about a tough question, you ought to hire someone in Ohio — someone like Karen or like many of the other very good lawyers licensed in Ohio who are members of APRL for example.  Those folks could give them candid advice about the risks of their proposed endeavor and offer advice informed by comprehensive knowledge of the Ohio ethics rules but also advice informed by knowledge of other aspects of the law as well.    I suspect good Ohio ethics lawyers would have told them some version of the following — yes, you might get in trouble if someone ever makes an issue out of it, but not entirely clear that you would get punished given the lay of the land, if you did it would probably be relatively minor, but it isn’t an area that anyone can give you a clear blessing in advance.

That kind of practical advice is something that a body like the Ohio Board simply isn’t in a position to give.  As a result, you get Ohio Opinion 2016-6.  And, the analysis in Ohio Opinion 2016-6 seems all the more frustrating when just a few days later a federal appeals court ruled that the Department of Justice could never actually prosecute someone who was fully complying with a state’s medical marijuana laws because of a funding bill restriction passed by Congress.  You can read about that opinion here.