Conflicts of Interest

When a lawyer represents or seeks to represent a class of plaintiffs or defendants in a class-action lawsuit, unnamed members of the class are ordinarily not considered to be clients of the lawyer for conflict of interest purposes. Thus, the lawyer does not typically need to get the consent of such a person before representing a client suing the person in an unrelated matter. Similarly, a lawyer seeking to represent an opponent in a class action does not typically need the consent of an unnamed member of the class whom the lawyer represents in an unrelated matter.

Does a lawyer need client consent from all members of a class to waive potential conflicts?

If there is a current conflict of interest, a lawyer may represent a client if: (mnemonic = RICI) i) the lawyer reasonably believes that the lawyer will be able to provide competent and diligent representation to each affected client; ii) the representation is not prohibited by law; iii) the representation does not involve the assertion of a claim by one client against another client represented by the lawyer in the same litigation or other proceeding before a tribunal; and iv) each affected client gives informed consent, confirmed in writing. (Oral consent does not count!)

How can a client waive a current client conflict?

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: i) the matter is the same or substantially related to that in which the formerly associated lawyer represented the client, and ii) any lawyer remaining in the firm has information protected by the rules of confidentiality that is material to the matter.

Is there a conflict of interest if a firm represents a client whose position is materially adverse to a former client represented by a lawyer who is no longer associated with that firm?

A lawyer may not enter into an arrangement with a third person that will materially limit the lawyer's ability to represent the client unless the lawyer reasonably believes that the third person's interest will not adversely affect the representation and the client gives informed consent.

May a lawyer enter into an arrangement with a third person regarding the scope of representation of another client?

A lawyer shall not have sexual relations with a client unless a consensual sexual relationship existed between them when the client-lawyer relationship commenced. Note: A lawyer is subject to discipline if the lawyer begins a sexual relationship with a client even if the client consented and even if the client initiated it. The only exception is if the relationship pre-dated the representation.

May a lawyer have a sexual relationship with a client?

Prior to the conclusion of representation of a client, a lawyer shall not make or negotiate an agreement giving the lawyer literary or media rights to a portrayal or account based in substantial part on information relating to the representation.

May a lawyer negotiate with a client for the literary or media rights of the client's matter?

A lawyer shall not provide financial assistance to a client in connection with pending or contemplated litigation, except that: 1) a lawyer may advance court costs and expenses of litigation, the repayment of which may be contingent on the outcome of the matter; and 2) a lawyer representing an indigent client may pay court costs and expenses of litigation on behalf of the client.

May a lawyer provide financial assistance to a client?

A lawyer shall not solicit any substantial gift from a client, including a testamentary gift, or prepare on behalf of a client an instrument giving the lawyer or a person related to the lawyer any substantial gift unless the lawyer or other recipient of the gift is related to the client. Related persons include a spouse, child, grandchild, parent, grandparent, or other relative or individual with whom the lawyer or the client maintains a close, familial relationship. Note: A lawyer may accept a gift—even a substantial gift. However, note that any substantial gift may be voidable by the client under the doctrine of undue influence.

May a lawyer solicit a gift from a client? Are there any exceptions?

A lawyer shall not use information relating to representation of a client to the disadvantage of the client unless the client gives informed consent, except as permitted or required by the MRPC.

May a lawyer use information relating to the representation of a client to the client's disadvantage?

Settling a claim: A lawyer shall not settle a claim or potential claim for such liability with an unrepresented client or former client unless that person is advised in writing of the desirability of seeking advice of independent legal counsel and is given a reasonable opportunity to seek the advice of independent legal counsel in connection therewith.

When may a lawyer settle a claim for malpractice liability with an unrepresented client?

A lawyer who represents two or more clients shall not participate in making an aggregate settlement of the claims of or against the clients, or in a criminal case an aggregated agreement as to guilty or nolo contendere pleas, unless: (1) each client gives informed consent, in a writing signed by the client; and (2) the lawyer's disclosure shall include the existence and nature of all the claims or pleas involved and of the participation of each person in the settlement.

What is an aggregate settlement agreement and when is it permitted?

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 the conflict rules unless: a) the prohibition is based on a personal interest of the disqualified lawyer and does not present a significant risk of materially limiting the representation of the client by the remaining lawyers in the firm, or b) the prohibition is based upon a conflict with a former client and arises out of the disqualified lawyer's association with a prior firm, and i) the disqualified lawyer is timely screened from any participation in the matter and is given no part of the fee earned from the representation; ii) written notice is promptly given to any affected former client to enable the former client to ascertain compliance with the provisions of this rule, which shall include: (1) a description of the screening procedures employed, (2) a statement of the firm's and of the screened lawyer's compliance with these rules, (3) a statement that review may be available before a tribunal, and (4) an agreement by the firm to respond promptly to any written inquiries or objections by the former client about the screening procedures; and iii) certifications of compliance with these rules and with the screening procedures are provided to the former client by the screened lawyer and by a partner of the firm at reasonable intervals upon the former client's written request and upon termination of the screening procedures.

What is an imputed conflict and how can a lawyer get around it?

A lawyer shall not enter into a business transaction with a client or knowingly acquire an ownership, possessory, security, or other pecuniary interest adverse to a client unless (mnemonic = FARIIS): 1) the transaction and terms on which the lawyer acquires the interest are fair and reasonable to the client and are fully disclosed and transmitted in writing in a manner that can be reasonably understood by the client; 2) the client is advised in writing of the desirability of seeking and is given a reasonable opportunity to seek the advice of independent legal counsel on the transaction; and 3) the client gives informed consent, in a writing signed by the client, to the essential terms of the transaction and the lawyer's role in the transaction, including whether the lawyer is representing the client in the transaction.

What precautions must be undertaken if a lawyer is going to enter a business transaction with a client?

When the lawyer has received disqualifying information regarding a prospective client, representation is permissible in two cases: Situation #1: informed consent from both clients. Both the affected client and the prospective client have given informed consent, confirmed in writing. Situation #2: Screening, which requires: (1) the lawyer who received the information took reasonable measures to avoid exposure to more disqualifying information than was reasonably necessary to determine whether to represent the prospective client, and (2) the disqualified lawyer is timely screened from any participation in the matter and is apportioned no part of the fee therefrom, and (3) written notice is promptly given to the prospective client.

When can a prospective client conflict be waived?

Ordinarily a lawyer may take inconsistent legal positions in different tribunals at different times on behalf of different clients. The mere fact that advocating a legal position on behalf of one client might create precedent adverse to the interests of a client represented by the lawyer in an unrelated matter does not create a conflict of interest. A conflict of interest exists, however, if there is a significant risk that a lawyer's action on behalf of one client will materially limit the lawyer's effectiveness in representing another client in a different case. For example, when a decision favoring one client will create a precedent likely to seriously weaken the position taken on behalf of the other client.

When do inconsistent legal positions create a conflict of interest?

General rule: a lawyer shall not represent anyone in connection with a matter in which the lawyer participated personally and substantially as a judge, other adjudicative officer, or law clerk to such a person or as an arbitrator, mediator, or other third-party neutral unless all parties to the proceeding give informed consent, confirmed in writing. Exception: an arbitrator selected as a partisan of a party in a multimember arbitration panel is not prohibited from subsequently representing that party. Note: the fact that a former judge exercised administrative responsibility in a court does not prevent the former judge from acting as a lawyer in a matter where the judge had previously exercised remote or incidental administrative responsibility that did not affect the merits.

When does a conflict of interest arise for a former judge, arbitrator, or adjudicative officer?

Except as law may otherwise expressly permit, a lawyer who has formerly served as a public officer or employee of the government: 1) Is subject to the former client conflict rules (Rule 1.9). 2) May not otherwise represent a client in connection with a matter in which the lawyer participated personally and substantially as a public officer or employee, unless the appropriate government agency gives its informed consent, confirmed in writing, to the representation. 1) "Matter" is narrow and it means a specific set of facts involving specific parties. 2) "Personally and substantially": means that the lawyer was personally involved.

When does a conflict of interest arise for a lawyer who formerly served as a public officer and now works in the private sector?

Except as law may otherwise expressly permit, a lawyer currently serving as a public officer or employee: 1) Is subject to the present client conflict rules (Rule 1.7) and former client conflict rules (Rule 1.9). 2) May not participate in a matter in which the lawyer participated personally and substantially while in private practice or nongovernmental employment, unless the appropriate government agency gives its informed consent, confirmed in writing. 3) May not negotiate for private employment with any person who is involved as a party or as lawyer for a party in a matter in which the lawyer is participating personally and substantially. (1) Exception: a lawyer serving as a law clerk to a judge, other adjudicative officer, or arbitrator may negotiate for private employment as permitted by the rules.

When does a current conflict of interest arise for a public officer or government lawyer?

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

When does a former client conflict exist?

A lawyer shall not knowingly represent a person in the same or a substantially related matter in which a firm with which the lawyer formerly was associated had previously represented a client: a) whose interests are materially adverse to that person; and b) about whom the lawyer had acquired information protected by Rule 1.6 (confidentiality) and Rule 1.9(c) that is material to the matter, unless the former client gives informed consent, confirmed in writing. Note: a lawyer who has general access to files of all clients of a law firm and who regularly participates in discussions of their affairs should be inferred to be privy to all information about the firm's clients.

When does a former firm conflict of interest exist?

Even when no client-lawyer relationship ensues, a lawyer who has learned information from a prospective client shall not use or reveal that information unless an exception to confidentiality applies. Rule: A lawyer 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 below. Note: This is imputed to other firm members: if a lawyer is disqualified from representation under this rule, no lawyer in a firm with which that lawyer is associated may knowingly undertake or continue representation in such a matter, except as provided below.

When does a prospective client conflict arise?

A lawyer shall not represent a client if the representation involves a concurrent conflict of interest. A concurrent conflict of interest exists in two scenarios: i) the representation of one client will be directly adverse to another client; or ii) there is a significant risk that the representation of one or more clients will be materially limited by the lawyer's responsibilities to another client, a former client, a third person, or by a personal interest of the lawyer.

When is there a current client conflict of interest?

General rule—no negotiating employment: a lawyer shall not negotiate for employment with any person who is involved as a party or as lawyer for a party in a matter in which the lawyer is participating personally and substantially as a judge or other adjudicative officer or as an arbitrator, mediator, or other third-party neutral. Exception—law clerks: a lawyer serving as a law clerk to a judge or other adjudicative officer may negotiate for employment with a party or lawyer involved in a matter in which the clerk is participating personally and substantially, but only after the lawyer has notified the judge or other adjudicative officer.

When may a judge, arbitrator or third-party neutral negotiate for employment?

A lawyer shall not acquire a proprietary interest in the cause of action or subject matter of litigation the lawyer is conducting for a client. Exceptions: The lawyer may: 1) acquire a lien authorized by law to secure the lawyer's fee or expenses, or 2) contract with a client for a reasonable contingent fee in a civil case.

When may a lawyer acquire a proprietary interest in a cause of action?

Waiving malpractice liability: a lawyer shall not make an agreement prospectively limiting the lawyer's liability to a client for malpractice unless the client is independently represented in making the agreement. A lawyer may agree prospectively, however, to arbitrate all legal malpractice claims if the client understands the scope of the agreement.

When may a lawyer ask a client to limit malpractice liability?

A lawyer shall not accept compensation for representing a client from one other than the client unless: (1) the client gives informed consent, (2) there is no interference with the lawyer's independence of professional judgment or with the client-lawyer relationship, and (3) information relating to representation of a client is kept confidential.

When may a lawyer receive compensation from a third party for representation of a client?