What's New in Legal Ethics 2021 - Michael Downey 2021 Downey Law Group LLC. For educational purposes only - Downey Law ...
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What’s New in Legal Ethics 2021
Michael Downey
© 2021 Downey Law Group LLC. For educational purposes only.Introductory Matters
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2Conflicts of Interest
“Materially Adverse” Conflicts
ABA Opinion 497
(February 2021)Rule 1.9(a) “Material Adversity” A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person’s interests are materially adverse to the interests of the former client unless the former client gives informed consent, confirmed in writing.
Rule 1.18(c) “Material Adversity”
A lawyer subject to paragraph (b) shall not represent
a client with interests materially adverse to those of
a prospective client in the same or a substantially
related matter if the lawyer received information
from the prospective client that could be significantly
harmful to that person in the matter, except as
provided in paragraph (d).
6“Material Adversity” Since Ethics 2000
• [A]uthorities have generally concluded that “material
adverseness” includes, but is not limited to, matters where
the lawyer is directly adverse on the same or a substantially
related matter.
• While material adverseness is present when a current
client and former client are directly adverse, material
adverseness also can be present where direct adverseness
is not.
7Zerger & Mauer LLP v. City of
Greenwood (8th Cir. 2014)
This analysis focuses on “whether the current
representation may cause legal, financial, or
other identifiable detriment to the former
client.”
8Examples of “Material Adversity”
1. Suing or negotiating against a former client
2. Attacking a lawyer’s own prior work
3. Examining a former client
9Waiver of Former Client Conflict
• Waiver to undertake representation generally does
not authorize using/revealing former client’s
confidences
• Must secure waiver to use/reveal information
under Rules 1.6, 1.8(b), 1.9(c) and 1.18
10Missouri Informal Opinion
2021-05
(May 2021)
11Opinion 2021-05: Question
• Company and Manager have been named as Defendants in a
wrongful termination suit filed by Former Employee.
• Attorney represents Company in the matter through CEO as the
duly authorized constituent of Company.
• Former Employee alleges misconduct by Manager, but Company
denies such misconduct on the part of Manager.
• Company, through CEO, has asked Attorney also to represent
Manager, and will pay Attorney’s fees for both representations.
• May Attorney represent both Company and Manager in the
matter?
12Opinion 2021-05: Answer
• Attorney representing Company may also represent Manager subject to Rule 4-1.7 Conflict of
Interest: Current Clients. Rule 4-1.13(e).
• Given the allegations of misconduct by Manager, a concurrent client conflict of interest exists
because there is a significant risk that Attorney’s responsibilities to Company will be materially
limited by Attorney’s responsibilities to Manager. Rule 4-1.7(a)(2).
• Pursuant to Rule 4-1.7(b)(1), Attorney may only undertake representation of Manager if
Attorney has a reasonable belief at the outset of the representation that Attorney will be able
to provide competent and diligent representation to both Company and Manager in a common
representation. Attorney must resolve consentability as to both Company and Manager. Rule 4-
1.7, Comments [14] and [15].
• Because Company is paying for the representation of Manager, Attorney must comply with Rule
4-1.8(f), which prohibits Attorney from accepting compensation from someone other than the
client, in this case Corporation paying for the representation of Manager, unless Manager gives
informed consent to the arrangement, there is no interference with Attorney’s independent
professional judgment or the client-lawyer relationship, and confidential information is protect
by Rule 4-1.6. See also Rule 4-1.8, Comments [11] and [12]; Rule 4-1.7, Comment [13].
13Opinion 2021-05: Answer
• To engage in the common representation, Attorney shall seek informed consent, confirmed in writing,
from both Company and Manager pursuant to Rule 4-1.7(b)(4). See Rule 4-1.7, Comments [14], [15],
and [20]; see also Rule 4-1.0(e) defining “informed consent,” Comments [6] and [7].
• In seeking informed consent, Attorney must discuss with Company and Manager the “implications of
the common representation including the possible effects on loyalty, confidentiality, the attorney-
client privilege and the advantages and risks involved. Rule 4-1.7, Comment [18]; see also Comments
[30], [31], and [32].”
• Attorney should advise Company and Manager that Attorney will share with both clients information
relevant to representation, and that Attorney will be required to withdraw if one of the jointly
represented clients decides a material matter should be kept from the other. See Rule 4-1.7,
Comment [31].
• Further, Attorney should advise Company and Manager that, if the common representation fails
because potentially adverse interests cannot be reconciled, Attorney will have to withdraw from
representing both clients. See Rule 4-1.7, Comment [29].
• Since Company’s consent to the dual representation is required by Rule 4-1.7, Rule 4-1.13(e) requires
that the consent be given by an appropriate official of Company other than Manager who is seeking
representation.
14Conflict Waiver – Elements
• Circumstances
• Risks
– Loyalty/zeal
– Confidentiality and privilege
• Risks (and benefits)
15Missouri Informal Opinion
2021-04
(May 2021)
16Opinion 2021-04 – Question
• Attorney represents three siblings as clients in a pending partition action of a
parcel, a family farm, subject to distribution from the estate of siblings’
surviving parent.
• Originally, all three clients wanted the parcel partitioned equally so each could
own a portion of the farm for their individual purposes.
• Attorney accepted the representations of Clients A, B, and C in the partition
action.
• Client B has now decided to pursue a greater share and has asked Attorney to
assist in this action.
• Clients A and C are opposed to Client B’s request for a greater share and now
want the parcel to be sold and proceeds divided equally between A, B, and C.
• Should Attorney withdraw from the representation of any of Clients A, B, and
C, or may Attorney proceed with representing Clients A and C?
17Opinion 2021-04 – Answer
• Attorney is required to withdraw from representing Clients A, B,
and C.
• When Attorney accepted the representation of Clients A, B, and
C, all three clients wanted the parcel partitioned equally.
• Now, the objectives of Clients A, B, and C have changed, making
their positions directly adverse pursuant to Rule 4-1.7(a).
• Comment [29] to Rule 4-1.7 provides guidance that a lawyer is
“[o]rdinarily…forced to withdraw from representing all of the
clients if the common representation fails.”
18Opinion 2021-04 – Answer
• Further, Comment [4] to Rule 4-1.7 provides additional guidance and states: “…whether
the lawyer may continue to represent any of the clients is determined both by the
lawyer's ability to comply with duties owed to the former client and by the lawyer's
ability to represent adequately the remaining client or clients, given the lawyer's duties
to the former client. See Rule 4-1.9. See also Comments [5] and [29].”
• If Attorney withdraws from representing B, Attorney still cannot continue to represent
Clients A and C because Attorney would be unable to comply with Rule 4-1.9 as it would
relate to Client B as a former client.
• Continued representation of Clients A, B, or C would result in a violation of Rule 4-1.7, so
Attorney is required to withdraw pursuant to Rule 4-1.16(a).
• Attorney must seek permission of the court to withdraw from the representation in
accordance with Rule 4-1.16(c) by informing the court that professional considerations
require termination of the representation Rule 4-1.16(c), Comment [3], and assist Clients
A, B, and C upon withdrawal as provided in Rule 4-1.16(d).
19Conflicts Involving Witnesses
DC Opinion 380
(February 2021)Subpoenaing Current Client
• CA – per se conflict to subpoena current
client
• NYC – “ordinarily” entails conflict
• ABA – “likely”
21DC View
“In our view, subpoenaing a current client creates a
conflict only if the client objects, or if it is reasonably
foreseeable that the client will object to any aspect
of the subpoena or to the burden and costs it
creates.”
22Other Bases for Conflicts
• Advising client-witness on Fifth Amendment
rights
• Cross-examining client
• Thrust-upon conflicts – DC specific rule
23”Upjohn” Warnings
• Given to “constituent” of represented entity
• Seek to avoid (a) inadvertent lawyer-client relationship and (b)
confusions over confidentiality
• “I am not your lawyer – I represent the company”
• “Our communications are confidential and may be privileged – but the
company controls that privilege”
• [Possible] “You can retain your own counsel, and the company will pay
for that counsel”
24Client Confidentiality
25Missouri Informal Opinion
2021-03
26Opinion 2021-03: Question
• Attorney proposes to enter into a contract with a
shredding company for regular collection and
disposal of closed client files. Attorney is
concerned about preserving confidentiality in
doing so.
• May Attorney use an outside shredding company
to dispose of closed files?
27Opinion 2021-03: Answer
• Provided
– Attorney has held the client files for the required period of time pursuant to Rule 4-
1.22 such that the files are deemed abandoned by the clients, items of intrinsic
value have been removed, and
– Attorney does not know or reasonably should know of the pendency of a
malpractice claim, criminal or other governmental investigation, complaint under
Rule 5, or other litigation related to the representation,
• Attorney may engage a shredding company vendor to dispose of closed
files consistent with Rule 4-5.3.
• Rule 4-1.22 states that “[t]he file shall be destroyed in a manner than
preserves confidentiality.”
28Opinion 2021-03: Answer
• Attorney should select a vendor that will destroy the file in a manner to
ensure confidentiality.
• Attorney should select a vendor in accordance with Attorney’s
supervisory responsibilities pursuant to Rule 4-5.3, as Attorney is
required to make reasonable efforts to ensure that the vendor’s
conduct is compatible with the professional obligations of Attorney, in
this case making sure that the shredding company is able to preserve
confidentiality of the files in the destruction process in accordance
with Attorney’s responsibilities under Rules 4-1.22 and 4-1.6. Rule 4-
5.3(b).
29Opinion 2021-03: Answer
• Rule 4-5.3, Comment [3] provides guidance on use of vendors such as a
shredding company and states: “When using such services outside the firm, a
lawyer must make reasonable efforts to ensure that the services are provided
in a manner that is compatible with the lawyer's professional obligations.
• The extent of this obligation will depend upon
– the circumstances, including the education, experience and reputation of the nonlawyer;
the nature of the services involved;
– the terms of any arrangements concerning the protection of client information; and
– the legal and ethical environments of the jurisdictions in which the services will be
performed, particularly with regard to confidentiality.
• When retaining or directing a nonlawyer outside the firm, a lawyer should
communicate directions appropriate under the circumstances to give
reasonable assurance that the nonlawyers conduct is compatible with the
professional obligations of the lawyer.”
30Opinion 2021-03: Answer
• Attorney may consider use of a confidentiality agreement to assist with
ensuring those professional obligations are met. See Informal Opinions
20070008; 20050068.
• Further, Attorney is responsible for the conduct of the vendor that would be a
violation of the Rules if engaged in by Attorney if Attorney orders or ratifies the
conduct with knowledge of the specific conduct. Rule 4-5.3(c)(1).
• Similarly, Attorney is responsible for the conduct of the outside vendor related
to the files subject to agreement with Attorney that would be a violation of the
Rules if engaged in by Attorney if Attorney is a partner, has comparable
managerial authority, or direct supervisory authority, and knows of such
conduct at a time when its consequences can be avoided or mitigated but fails
to take reasonable remedial measures. Rule 4-5.3(c)(2).
31Handling Client Property
(and Protecting Confidences)
32Missouri Informal Opinion
2021-01
33Opinion 2021-01: Question
• Attorney met with Client regarding possible dissolution of marriage.
• Attorney deposited in the client trust account an advance payment of fees and
expenses from Client.
• Client and Spouse reconciled, and the funds were not earned, nor expenses
incurred.
• Attorney attempted to contact Client through means Attorney believed were
confidential, but Client did not respond.
• Attorney is concerned that attempts to use other forms of communication or
to deliver the funds to Client may result in Spouse learning of the dissolution-
related consultation between Attorney and Client.
• Attorney asks what to do with the funds.
34Opinion 2021-01: Answer
• Attorney must use Attorney’s independent professional judgment to
balance Attorney’s duty of confidentiality per Rule 4-1.6 and Attorney’s
obligation per Rule 4-1.15(d) to promptly notify Client of the funds and
promptly deliver the funds to Client as required by the Rule.
• Rule 4-1.6(c) requires Attorney to make reasonable efforts to prevent
the inadvertent or unauthorized disclosure of, or unauthorized access
to, information relating to the representation of the client.
• Comment [16] provides guidance that if a method of communication
affords a reasonable expectation of privacy, special security measures
are not required, but that special circumstances may warrant special
precautions.
35Opinion 2021-01: Answer
• Attorney should continue to hold the funds in the client trust account
and make reasonable efforts to notify Client of the funds to arrange for
delivery, if possible. Informal Opinions 2020-17; 20000129; 990102;
960053.
• Attorney should use methods of communication that afford a
reasonable expectation of privacy under the circumstances.
• In taking action that complies with Attorney’s obligations under Rules
4-1.6 and 4-1.15, Attorney should be mindful of obligations under Rule
4-1.2(f) and (g), as well as applicable law addressing a lawyer’s
obligations regarding client funds in a lawyer trust account and the
nature of the relationship between the lawyer and client as it pertains
to the funds. See State ex rel. Koster v. Cain, 383 S.W.3d 105 (Mo. Ct.
App. 2012).
36Virtual Practice
Virtual Practice ABA Opinion 498 (March 2021)
Commonly Implicated Rules
• Competence (1.1), Diligence (1.3), and
Communication (1.4)
• Confidentiality (1.6)
– Shall not “reveal information relating to the
representation”
• Supervision of non-lawyer subordinates
(5.1)Need to Be Technologically Competent
Comment [8] to Model Rule 1.1:
“To maintain the requisite knowledge and skill [to be
competent], a lawyer should keep abreast of changes in the
law and its practice, including the benefits and risks
associated with relevant technology, engage in continuing
study and education and comply with all continuing legal
education requirements to which the lawyer is subject.”
40Supervision of Subordinates – Rule 5.3
A lawyer must give such assistants appropriate
instruction and supervision concerning the ethical
aspects of their employment, particularly regarding
the obligation not to disclose information relating to
representation of the client, and should be
responsible for their work product.
41Consideration of Technologies Used
• Confidentiality protected?
– Installing updates
– Using passwords and encryption
– Periodic assessment
• Reliable access to files (and backups)
42Concerns for Virtual Practice
• Compliance with appropriate trust account
rules
• Writing and depositing checks
• Receiving mail
• Appropriate signage
43Lawyers Working Remotely
ABA Opinion 495
(December 2020)Prohibition Against Unauthorized Practice “A lawyer shall not practice law in a jurisdiction in violation of the regulation of the legal profession in that jurisdiction, or assist another in doing so” unless authorized by the rules or law to do so ABA Rule 5.5(a)
Limits on “Foreign” Practice
Rule 5.5(b)
A lawyer shall not
• “establish an office or other systematic and
continuous presence in [the] jurisdiction [in which
the lawyer is not licensed] for the practice of law.”
• “hold out to the public or otherwise represent that
the lawyer is admitted to practice law in [the]
jurisdiction
46Conclusion
The Committee’s opinion is that,
• in the absence of a local jurisdiction’s finding that the activity
constitutes the unauthorized practice of law,
• a lawyer may practice the law authorized by the lawyer’s
licensing jurisdiction for clients of that jurisdiction, while
physically located in a jurisdiction where the lawyer is not
licensed
• if the lawyer does not hold out the lawyer’s presence or
availability to perform legal services in the local jurisdiction or
• actually provide legal services for matters subject to the local
jurisdiction, unless otherwise authorized.
47Advising on Unlawful Conduct
48Missouri Informal Opinion
2021-01
49Opinion 2021-02: Question
May a lawyer represent individuals or
businesses in conduct pursuant to Article XIV
of the Missouri Constitution, entitled “Medical
Cannabis,” which is also frequently referred to
as medical marijuana?
50Opinion 2021-02: Answer
• Rule 4-1.2(f) states: “[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.”
• The Comments accompanying each Rule of Professional Conduct “are intended
as guides to interpretation, but the text of each Rule is authoritative.” Scope
[21].
• Comment [8] to Rule 4-1.2 states: “In counseling or assisting, if a state law
conflicts with federal law, the lawyer should advise the client of that fact but
cannot (1) undertake conduct that would violate federal law or (2) counsel or
assist the client as to how to perform an act that would violate federal law
even if that conduct would be lawful under the state statutory or constitutional
law. See Rule 4-1.1 and 4-1.4.”
51Opinion 2021-02: Answer
• If a lawyer representing individuals or businesses in conduct pursuant
to Article XIV of the Missouri Constitution, Medical Cannabis, would be
in conflict with federal law, the lawyer should advise the client of that
fact, but the lawyer cannot undertake conduct that would violate
federal law or counsel or assist a client as to how to perform an act
that would violate federal law even if that conduct would be lawful
under the state statutory or constitutional law.
• Whether such conduct would violate federal law is a question outside
the Rules of Professional Conduct. Further, Rule 4-8.4 (b) states that “It
is professional misconduct for a lawyer to commit a criminal act that
reflects adversely on the lawyer’s honesty, trustworthiness, or fitness
as a lawyer in other respects.” Violation of federal law by a lawyer may
rise to the level of misconduct under Rule 4-8.4(b).
52Responding to Third-Party
Subpoenas
53DC Opinion 381
(February 2021)
54• [T]o determine whether a conflict of interest exists in
undertaking the prospective engagement [of helping a
prospective client respond to a subpoena], the lawyer must
assess whether the lawyer knows, after performing
reasonable diligence in evaluating the subpoena request as
described above, that the Prospective Client possesses
responsive information that, if produced, is or likely will be
adverse to the subject of the subpoena (the Other Client)
55DC Test
• A lawyer’s representation of a Prospective Client does not create a conflict of interest unless:
(1) the lawyer knows, after performing reasonable diligence in evaluating the subpoena request,
that the Prospective Client possesses responsive information that, if produced, is or likely will
be adverse to the Other Client, and such knowledge likely will adversely affect the lawyer’s
representation of either client; or
(2) the lawyer’s professional judgment will or reasonably may be adversely affected by the
lawyer’s responsibilities to or interests in a third party or the lawyer’s own financial,
business, property, or other interests as a result of the prospective engagement.
• Reasonable diligence prior to undertaking the new engagement includes considering the
particulars of the proceeding out of which the subpoena issued and the information
contained in the subpoena itself, including the time period, the scope of information
sought, and the names of persons identified and their connection to the information
sought.
• It might also include review of publicly available information or consultation with the
Other Client depending on the knowledge of the lawyer concerning the circumstances
surrounding the subpoena request and its implications.
56Future Programs – Free Ethics CLE
Addressing Bias in the Legal Profession (2020-21 content) - 1.0 Ethics and Elimination of Bias CLE
June 24 (Thursday) at 3 PM CT
June 29 (Tuesday) at 12 Noon CT
Legal Ethics and Social Media - 1.0 Ethics CLE
June 15 (Tuesday) at 12 Noon CT
Judicial Ethics for Lawyers and Judges – 1.0 Ethics CLE (MO and KS approval pending)
July 7 (Wednesday) at 12 Noon CT
Legal Ethics for Getting Paid – 1.0 Ethics CLE (MO and KS approval pending)
July 29 (Thursday) at 12 Noon CT
Sign up at www.DowneyEthicsCLE.com
57Link to Survey (and Certificate)
https://www.surveymonkey.com/r/CG5JKV8
58Thank You.
Michael Downey
Downey Law Group LLC
(314) 961-6644
(844) 961-6644 toll free
MDowney@DowneyLawGroup.comYou can also read
