Vol. 76, No. 2, February 2003

Suing a Former Client

by Dean R. Dietrich

Question

I have often been told that I can represent someone who is suing a former client of mine if the legal matter is different. What are the conditions for determining whether I can sue a former client?

Answer

You are right that you may represent a new client who is suing a former client, but there are certain conditions that must be met first. SCR 20:1.9 of the Wisconsin Supreme Court Rules of Professional Conduct addresses conflicts of interest with a former client. Under this rule, a lawyer may not represent another person "in the same or a substantially related matter" when that person's interests are "materially adverse" to the interests of a former client. As always, this representation can occur if the former client consents in writing after consultation to allowing the lawyer to represent another person in a matter against the former client.

A determination of whether you may represent a new client in a matter against a former client depends upon whether the matter is "the same or a substantially related matter" and whether the interests of the new client are "materially adverse" to the interests of the former client. Deciding if the interests are "materially adverse" will require the lawyer to determine the nature and extent of the controversy and the conflicting interests or goals of the new client compared to the likely interests and goals of the former client. Most often, the fact situation in a litigation matter will present an obvious conclusion as to whether the interests of the new client are adverse to the interests of the former client.

The more difficult determination is whether the matter for which the lawyer is providing representation to the new client is "the same or substantially related" to the matter for which the lawyer provided services to the former client. The recent ABA Commission on Professional Ethics (known as Ethics 2000) recommended that new language be added to the Comment on Model Rule 1.9 that would provide further guidance to lawyers in determining whether a matter is "the same or substantially related" to the matter of the former representation. The Ethics 2000 Commission stated:

"Matters are 'substantially related' for purposes of this Rule if they involve the same transaction or legal dispute or if there otherwise is a substantial risk that confidential factual information as would normally have been obtained in the prior representation would materially advance the client's position in the subsequent matter."

The Comment also provides that information that has been disclosed to the public or to other parties that is adverse to the former client would not be used to disqualify the attorney from representing the new client. The same is true of government information that the lawyer is impliedly authorized to use or disclose or that is known to persons outside the governmental agency involved. Another relevant consideration in determining whether the second representation is substantially related to the first representation is whether information acquired during the prior representation has since become obsolete. In the case of a client that is an organization, the Comment suggests that general knowledge of the client's policies and practices ordinarily would not preclude a subsequent representation, but knowledge of specific facts gained in a prior representation that are relevant to the matter in dispute would likely preclude the representation of the new client against the former organizational client.

The Comment to Model Rule 1.9 provides two examples to emphasize the determination of a substantially related matter:

"A lawyer who has represented a business person and learned extensive private information about that person may not then represent that person's spouse in seeking a divorce"; and

"A lawyer who has previously represented a client in securing environmental permits to build a shopping center is precluded from representing neighbors seeking to oppose rezoning of the property on the basis of environmental considerations; however, the lawyer would not be precluded, on the grounds of substantial relationship, from defending a tenant of the completed shopping center in resisting eviction for nonpayment of rent."

Court cases throughout the country differ on whether a lawyer representing a business person is precluded from representing that person's spouse in a divorce proceeding. Recent decisions have allowed such representation, provided the information learned by the lawyer in the prior representation of the business person is information that generally would be discoverable or disclosed during the divorce proceedings.

Under the Wisconsin Supreme Court rules regarding conflicts with former clients, lawyers must be careful to analyze the nature of their prior representation of the former client and make sure that the representation of the new client is not in a same or substantially related matter. If the lawyer fails to do so, it is likely the lawyer will be disqualified from representing the new client unless the former client consents in writing after consultation.

Wisconsin Lawyer