May 17, 2017 – When a lawyer leaves a firm, do they take their conflicts with them? Or do the conflicts remain at the firm after they leave?
Lawyer A represented Husband in divorce, which was concluded more than two years ago. Shortly after the divorce was concluded, Lawyer A left the Firm to move to a different state. Now Wife has approached Firm and asked for representation against Husband in connection with post-judgment proceedings arising from the same divorce in which Lawyer A represented Husband.
May Firm represent Wife in the post-judgment proceedings?
Have an Ethical Dilemma?
Ethical dilemmas affect every lawyer’s practice. This series of questions and answers appears each month in InsideTrack. The answers, offered by the State Bar’s ethics counsel org tpierce wisbar Timothy Pierce and org akaiser wisbar Aviva Kaiser, are intended to provide guidance only and are not legal authority. Each situation will depend on the facts and circumstances involved.
As a State Bar member, you have access to informal guidance in resolving questions regarding Wisconsin’s Rules of Professional Conduct for Attorneys. To informally discuss an ethics issue, contact Pierce or Kaiser. They can be reached at (608) 229-2017 or (800) 254-9154, Monday through Friday, 9 a.m. to 4 p.m.
It is clear that Lawyer A would have a former client conflict if they represented Wife in post-judgment proceedings [see SCR 20:1.9(a)]. The entire Firm would also be conflicted if Lawyer A remained with Firm. SCR 20:1.10(a) provides, in relevant part:
(a) While lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by SCR 20:1.7 or SCR 20:1.9
Thus, if Lawyer A is still associated with Firm, Lawyer A’s SCR 20:1.9(a) conflict is imputed to every other lawyer in Firm.
The question, however, addresses what happens when the personally disqualified lawyer is no longer associated with Firm.
SCR 20:1.9(b) states:
(b) When a lawyer has terminated an association with a firm, the firm is not prohibited from thereafter representing a person with interests materially adverse to those of a client represented by the formerly associated lawyer and not currently represented by the firm, unless:
(1) the matter is the same or substantially related to that in which the formerly associated lawyer represented the client; and
(2) any lawyer remaining in the firm has information protected by SCR 20:1.6 and SCR 20:1.9(c) that is material to the matter.
On these facts, it is clear that the matter is substantially related, so the determinative question is whether any lawyer in Firm has any material information that “relates to the matter,” which is the scope of information protected by SCR 20:1.6 and SCR 20:1.9(c). This means that when a lawyer leaves a firm, the departing lawyer may take their conflicts with them when they leave the firm as long as the lawyer does not “leave” any material information about those matters with the lawyers who remain in the firm.
When analyzing this question, lawyers tend to concentrate (rightly) on whether any remaining lawyer assisted the departed lawyer in the representation of the former client. That, however, does not end the analysis. Section 124(1) of the Restatement (Third) of the Law Governing Lawyers provides further guidance and states:
(1) Imputation specified in § 123 does not restrict an affiliated lawyer when the affiliation between the affiliated lawyer and the personally prohibited lawyer that required the imputation has been terminated, and no material confidential information of the client, relevant to the matter, has been communicated by the personally prohibited lawyer to the affiliated lawyer or that lawyer's firm.
Comment (c)(i) further explains:
Personally prohibited lawyer terminates the affiliation. During the time that a personally prohibited lawyer is associated with another lawyer, law firm, or other organization to which prohibition is imputed under § 123, the lawyer could reveal confidential information to any other lawyer within the organization. Accordingly, imputed prohibition of all lawyers in the firm is appropriately required by § 123. However, after the personally prohibited lawyer has left the firm, an irrebuttable presumption of continued sharing of client confidences or continued disloyalty induced by the affiliation is no longer justified.
The lawyers remaining in the affiliation may rebut the presumption that confidential information was shared during the period of actual affiliation. They have the burden of persuasion concerning three facts: (1) that no material confidential client information relevant to the matter was revealed to any lawyer remaining in the firm; (2) that the firm does not now possess or have access to sources of client confidential information, particularly client documents or files; and (3) that the personally prohibited lawyer will not share fees in the matter so as to have an interest in the representation.
Therefore, in order to represent Wife, Firm must be able to demonstrate that:
1) No remaining lawyer in Firm has information about the matter either by assisting Lawyer A in the representation of Husband or having materials discussions about the matter with Lawyer A.
2) That Firm no longer has protected information about the matter. This includes the client file, whether in physical or electronic form, and whether stored on or off-site. It is important to remember that the test is not whether Firm actually accesses such information, but whether Firm has access to such information.
3) That the departed lawyer (Lawyer A) will not share in any of the fees generated from the new representation. This will likely not be an issue on these facts but may affect the analysis in matters involving contingent fees.
Thus, while a lawyer may take some conflicts with them when they leave a firm, firms frequently retain these conflicts by keeping a copy of the file.
In Case You Missed It: Read Past Ethical Dilemmas
Ethical Dilemmas appears monthly in InsideTrack. Check out these topics from recent issues:
When Do Job Negotiations Require Conflict Waivers?, April 19, 2017
There is a difference between sending out resumes, and a mutual expression of interest between a lawyer and a firm. So, just when do you need to let a client know that you are seeking a job with another firm?
File-sharing and the Privilege of Confidential Materials, March 15, 2017
In the era of cloud-based computing, security must be a paramount concern for lawyers when it comes to client information. Who is responsible when an office staff person inadvertently shares a link to confidential files to the opposing party in discovery?
For more, search “ethical dilemmas” on WisBar.org.