The Decade’s Important Ethics Opinions, an Ethics Quiz … · The Decade’s Important Ethics Opinions, an Ethics Quiz Show … or, ... An Ethics Quiz Show. Historical Question

Pillsbury Winthrop Shaw Pittman LLP

The Decade’s Important Ethics Opinions, an Ethics Quiz Show … or, When to Say Deal or No Deal

David Keyko - Pillsbury

Alex Hardiman – Pillsbury

Nancy Axilrod – Coach, Inc.

Pick a Team

A. Red

B. Blue

RedBlu

e

50%50%

1 | An Ethics Quiz Show

Historical Question

A. True (Deal)

B. False (No Deal)Tru

e (Deal)

False

(No D

eal)

50%50%1. The ABA Canons of Ethics were a

response to President Theodore

Roosevelt’s criticism of lawyers during

a 1905 commencement address at

Harvard in which he described lawyers

as “hired cunning” because they made

money by thwarting the public interest,

helping corporations and wealthy

entrepreneurs circumvent the law.


Historical Question

A. True (Deal). This was a part of the “Progressive”

themes to which President Roosevelt subscribed. He

called for moral leadership by lawyers to help shape the

national soul.


Historical Question

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%2. California was the first state

to adopt a code of ethics, which

it did in 1887.


Historical Question

B. False (No Deal). It was Alabama. Its code was

influential and formed the basis for every state’s code that

followed prior to the adoption of the ABA’s code in 1908.

According to the Alabama Code, “the lawyer’s duty of

zealous representation is subject to the lawyer’s greater

obligations to (i) the legal system, i.e., ‘obedience to law’;

(ii) third parties, i.e., ‘the obligation to his neighbor’; and

(iii) his own moral view of right and wrong or, in other

words, what was just and unjust in the eyes of his God,

i.e., ‘accountability to the Creator.’” James M. Altman,

“Considering The A.B.A.’s 1908 Canons of Ethics,” 14

Journal of Professional Lawyer 235, 286 (2008)


Historical Question

A. True (Deal)


e (Deal)

False

(No D

eal)

50%50%3. The 1908 ABA Code had 32

Canons, one of which stated that while

“simple business cards” are not per se

improper, all other forms of advertising,

whether direct or indirect, were

unprofessional and intolerable. Another

Canon stated that it was

unprofessional “to curry favor with

juries by fawning, flattery or pretended

solicitude for their personal conduct.”


Historical Question

A. True (Deal). Canon 27 forbade advertising and Canon

23 addressed conduct before a jury.


Ethics Opinions

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%4. State bar ethics opinions are

interpretations of the Rules of

Professional Conduct upon which

lawyers may rely.


Ethics Opinions

B. False (No Deal). In some states, like New Jersey,

where the bar is authorized to interpret the Rules of

Professional Conduct, the ethics opinions are binding.

In other jurisdictions, like New York, California, Virginia

and Texas, the opinions are advisory only.


Metadata

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%5. Most jurisdictions now have made

clear that a lawyer may not review

metadata that was accidently

included in transactional draft

documents sent by the opposing

side.


Metadata

B. False (No Deal). Most states’ bars have yet to publish

an ethics opinion on the subject. Those that have are

fairly evenly divided as to whether a lawyer may review

the metadata or not.


Attorney-Client Privilege

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%6. Following a merger, the

management of the merged

corporation retains the right to control

the privilege for pre-merger

communications, not the surviving

corporation, although this may be

changed by agreement.



B. False (No Deal). The surviving corporation retains the

privilege. See Great Hill Equity Partners IV LP v. SIG

Growth Equity Fund I LLLP, 80 A.3d 155 (Del. Ch. 2013).

This may be changed by contract. Failure to address this

issue can result in the privileged information being used

by the successor corporation against the management of

the corporation being “sold.” See Delaware General

Corporation Law 259.



A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%7. Attorney-client privilege

belonging to a corporation does

not survive the dissolution of the

corporation and is automatically

waived by the dissolution.



B. False (No Deal). At least one court has held that the

automatic loss of the privilege is too harsh and the

continued right to claim the privilege depends on whether

there is someone who continues to have the authority to

assert the privilege. See Red Vision Sys. Inc. v. Nat’l

Real Estate Info. Servs., LP, 108 A.3d 54 (Pa. Super.

2015).



A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%8. If inside corporate counsel is

not permitted to practice law in

the jurisdiction where he or she

is based, the communications

between the “lawyer” and the

corporation may not be privileged.



A. True (Deal). Gucci faced this issue in litigation with

Guess? Inc. It turned out that Gucci’s U.S. director of

legal services, based in New York, was an inactive

member of the California bar. The court upheld Gucci’s

claim of privilege, however, because Gucci had a

reasonable belief that the “counsel” was a lawyer and was

providing Gucci legal services. If there is no basis for a

reasonable belief that the person is a lawyer, no privilege

can be claimed. See Anwar v. Fairfield Greenwich Ltd.,

982 F.Supp.2d 260 (S.D.N.Y. 2013).



A. True (Deal)

B. False (No Deal) True (D

eal)

False

(No D

eal)

50%50%9. Inside counsel’s advice about

the withholding and destruction of

documents will be discoverable

pursuant to the crime-fraud exception

to the attorney-client privilege if the

government alleges the corporation has

engaged in the obstruction of justice

and the court finds that the corporation’s

actions in withholding the documents

were improper.



B. False (No Deal). If the corporation was seeking advice

on what its obligations were as opposed to seeking

assistance in breaking the law, the crime-fraud exception

does not apply. U.S. v Stevens, 771 F.Supp. 556 (D. Md.

2011).


Class Actions

A. True (Deal)


eal)

False

(No D

eal)

50%50%10. Before a lawsuit styled as a class that

has been certified as such, counsel for

defendants may contact potential class

members not named as being

represented by the plaintiffs’ counsel that

has filed the complaints to convince

those potential class members not to join

the lawsuit. This is true so long as the

lawsuits are pending in federal court.


Class Actions

B. False (No Deal). Whether a lawyer may contact

a potential party is governed by Model Rule of

Professional Conduct 4.2 (California Rule 2-100). Federal

courts for the most part have adopted the ethics rules of

the state where the federal courts are located. The

minority rule is that potential class members are

considered to be represented by class counsel even

before certification. Note that California and New York

follow the majority rule. Once a class has been certified,

in all jurisdictions plaintiffs’ class counsel is deemed to

represent all class members for purposes of Rule 4.2.


Communicating with a Represented Party

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%11. It is permissible for an attorney

to communicate with low level and

former employees of a corporate

party that is represented by counsel

and is on the opposite side of a

matter.


Communicating with a Represented Party

A. True (Deal). While Model Rule 4.2 forbids

communications with a represented party on the subjects

as to which the party is represented, a lawyer

representing a corporation does not represent every

employee of the corporation as a result of representing

the corporation. Comment [7] to Model Rule 4.2

(California Rule 2-100(B)) provides guidance as to who is

considered the client for purposes of no-contact rule. The

rule varies by jurisdiction, so care should be taken before

reaching out to a current or former employee of a

represented corporation.


Assisting Clients Communicating with Represented Parties

A. True (Deal)


e (Deal)

False

(No D

eal)

50%50%12. A lawyer may suggest that a client

speak directly to business people on

the opposing side of a matter even

though the opposing side has

counsel. The lawyer may give advice

to the client as to what to say and not

to say, but should not script the

conversation for the client.


Assisting Clients Communicating with Represented Parties

A. True (Deal). ABA Opinion 11-461 details the limits of the

assistance a lawyer may provide without violating Model

Rule 4.2 (the no-contact rule). The attorney, however, may

not assist the client in taking steps to deprive the opposing

side of the assistance of counsel. Thus, to the extent that

the attorney drafts a document to be executed by the other

side, the document should make clear that it should only be

signed following consultation with counsel. Note that New

York Rule 4.2 requires the lawyer to tell opposing counsel in

advance that the client intends to make direct contact if the

lawyer causes the client-to-client communication to occur.


Implied Consent to Allowing Opposing Counsel to Contact your Client

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%13. A lawyer may copy the

opposing client on an email

so long as the lawyer addresses

the email to opposing counsel.


Implied Consent to Allowing Opposing Counsel to Contact your Client

B. False (No Deal). See N.Y. City Bar Opinion 2009-1

and Cal. Bar Opinion 2011-181. While consent may be

implied, without such consent, simply sending a copy of

the communication to the opposing lawyer is not a way to

avoid the restrictions imposed by Model Rule 4.2

(California Rule 2-100).


Whistle-Blowing

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%14. In-house counsel is entitled

to a bounty under the Dodd-

Frank Wall Street Reform and

Consumer Protection Act of 2010

for acting as a whistleblower

even if the information disclosed

was received during the course

of a privileged communication.


Whistle-Blowing

B. False (No Deal). Sections 240.21F-4(b)(4)(i) and (ii) contain

a carve out for information a lawyer receives in connection with

a privileged communication unless the disclosure is permitted by

both Dodd-Frank and the applicable state Rules of Professional

Conduct (Model Rule 1.6, California Rule 3-100). Also note U.S.

ex rel Fair Laboratory Practices Associates v. Quest

Diagnostics, a 2011 S.D.N.Y. decision affirmed by the Second

Circuit finding that a former general counsel who joined a group

of former corporate executives to form a partnership to bring a

qui tam action against his former employer violated his

confidentiality obligations to his former client and he had a

conflict of interest in acting as counsel in the qui tam action.


Whistle-Blowing

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%15. Inside general counsel who

reports to management that there

are acts of dishonesty going on

within the corporation is

protected from discharge by

whistleblower statutes.


Whistle-Blowing

B. False (No Deal). While SOX 806 and various state

acts do contain whistle-blower protection, a general

counsel who was fired after reporting evidence of

corporate dishonesty to management was found not to be

protected by a state whistle-blower statute because the

report was part of the lawyer’s corporate duties and not

made to expose an illegality. See Kidwell v. Sybartic,

784 N.W.2d 220 (Minn. 2010).


Team Scores

Points Team Points Team


Wrongful Termination Claims

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%16. Most states permit former

inside counsel to disclose client

confidences to the extent necessary

to prosecute a wrongful termination

claim against his or her former

employer.


Wrongful Termination Claims

A. True (Deal). The ABA adopted Rule 1.6(d)(5) to allow

client confidences to be disclosed when necessary to

establish a cause of action against the client. See ABA

Ethics Opinion 01-424 agreeing the disclosure was

permitted to support a wrongful discharge claim. Note

that while the majority of states have adopted this

amendment, there are notable holdouts, including New

York, Illinois, and California (See Cal. State Bar Ethics

Op. 2012-183).


Joint Representation – Former Employees

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%17. Counsel may represent a company and

its former employees so long as the position

of the former employees does not conflict

with that of the corporation, but counsel

should be careful not to violate the rules on

solicitation of business when contacting the

former employees and volunteering to

represent them.


Joint Representation – Former Employees

A. True (Deal). While it is an odd decision, a New York

State appellate court disqualified a law firm from

representing former employees it obtained as clients by

calling them and volunteering to represent them at the

expense of the firm’s corporate client. Rivera v Lutheran

Med. Ctr., 899 N.Y.S.2d 859 (Second Dep’t 2010); but see

Wells Fargo Bank v. LaSalle Bank Nat’l Ass’n (W.D.Okla.

2010), holding the opposite.


Joint Representation – Waivers

A. True (Deal)


e (Deal)

False

(No D

eal)

50%50%18. When a lawyer is representing two

clients and a conflict arises, an advance

waiver permitting the lawyer to continue

to represent one of the clients and

resign from representing the other is

valid so long as the lawyer does not

possess relevant confidential

information that the lawyer might be

able to use against the former client.


Joint Representation – Waivers

B. False (No Deal). The advance waiver is valid even

if the lawyer has confidential sensitive information from

the former client. See GEM Holdco, LLC v Changing

World Techs. LP, (N.Y. Sup. Ct. 2015). It is a good idea,

however, to disclose in the advance waiver that the

lawyer may use confidential information imparted by

the former client against the former client.


Common Interest Agreements

A. True (Deal)


e (Deal)

False

(No D

eal)

50%50%19. Receiving information pursuant to a

joint interest agreement while

representing party A can preclude a

lawyer from representing party C (that

was not a party to the joint interest

agreement) in a lawsuit against party B

(that was party of the joint interest

agreement) even though the lawyer

never represented party B.


Common Interest Agreements

A. True (Deal). A lawyer may have “virtual clients” as a

result of receiving information under a joint interest

agreement. The joint interest agreement, however, may

expressly waive such a conflict. See In re Shared

Memory Graphics LLC, 659 F.3d 1336 (Fed. Cir.

2011)(including inside corporate counsel), and DC Bar

Ethics Opinion 349 (2009).


Representing Affiliated Corporations

A. True (Deal)


eal)

False

(No D

eal)

50%50%20. Suppose inside counsel jointly represents

both a parent corporation and one of its

subsidiaries, and suppose further that the

subsidiary is sold or files for bankruptcy. The

subsidiary can compel the former parent

company to disclose privileged communications

its officers had with the inside counsel about the

joint representation even though there was

never a joint interest agreement signed

between the parent and subsidiary.


Representing Affiliated Corporations

A. True (Deal). The existence of a joint interest

agreement is irrelevant. When there is a joint

representation, one party may not keep privileged

information about the joint representation from the

other party. See In re Teleglobe Communications Corp.,

493 F.3d 345 (3d Cir. 2007), finding that there was no

right to the privileged information because inside counsel

only represented the parent company with regard to the

privileged communications at issue.


Third Party Discovery

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%21. Seeking discovery from a corporate

client may be considered a conflict for a

lawyer that represents that corporation

on unrelated matters.


Third Party Discovery

A. True (Deal). Seeking discovery, whether testamentary

or documentary, is considered adverse in some

jurisdictions. See California State Bar Opinion 2011-182.

The conflict should be identified at the outset of the

retention, to the extent possible. It may be waived or

discovery may be conducted by conflict counsel.


Dissident Corporate Factions

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%22. A corporation’s lawyer may

represent a minority dissident faction

of the board in pursuing derivative

claims against corporate officers

if the lawyer is convinced that the

dissidents are doing what is best

for the corporation.


Dissident Corporate Factions

B. False (No Deal). Bringing a derivative suit on behalf

of the corporation for a minority faction will violate the

lawyer’s duty of loyalty to the corporation. See Ky. Bar

Ass’n v. Hines, 399 S.W.3d 750 (2013).


Disputes Among Corporate Owners

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%23. Corporate counsel probably will

not have a conflict if it represents the

majority owners of the company in a

dispute against the minority owners,

so long as the company and the

majority faction are not at odds with

each other.


Disputes Among Corporate Owners

A. True (Deal). The managing group and the company’s

interests must not be at odds. See Lake Havasu

Investment LLC v. Fleming, 217 Cal. App. 4th 770

(Cal. App. 4th Dist. 2013). The issue is a delicate one and

fact specific. See Alaska Bar Ethics Opinion 2012-3

(2012).


Representing a Special Committee

A. True (Deal)


e (Deal)

False

(No D

eal)

50%50%24. If counsel has written a report for a

special board committee that is

conducting an internal investigation,

disclosing the report to the entire board

can result in a waiver of attorney-client

privilege if members of the board not on

the special board committee are a subject

of the investigation.


Representing a Special Committee

A. True (Deal). See Ryan v. Gifford, 2007 WL 4259557.

The Delaware Chancery Court held that the privilege did

not apply because the privilege had been waived by virtue

of the special committee and counsel presenting the findings

to directors with interests adverse to the committee. The

court further explained that there was no common interest

between the special committee and some of the board

members because the directors were subjects of the

investigation. Therefore, the directors attended the meetings

in their individual capacities, rather than as fiduciaries.


Business Dealings with Client

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%25. Inside counsel who was to receive

an ownership stake in a new

management company his employer was

forming and was giving advice to his

employer on the formation of the new

management company had a conflict and

was subject to the ethics rule governing

business transactions between clients

and lawyers.


Business Dealings with Client

A. True (Deal). Model Rule 1.8(a) (California Rule 3-300)

governs business dealings between a lawyer and his or

her client. It applies both to outside and inside counsel.

See Kaye v. Rosefielde, 432 N.J. Super. 421 (App. Div.

2013). The rule requires written disclosure, client

consent, and that the transaction be fair to the client.


Lawyer’s Right to Free Speech

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%26. A lawyer, after ceasing to

represent a client, may publically

exercise his or her First Amendment

rights and state opposition to the

former client’s project on which the

lawyer worked so long as the lawyer

does not reveal any client

confidences.


Lawyer’s Right to Free Speech

B. False (No Deal). To the extent it may be inferred that

the opposition by the lawyer is a result of confidential

information the lawyer obtained during the representation

of the client (it will be hard for the lawyer to argue that the

confidential information the lawyer obtained is irrelevant),

the opposition would breach the lawyer’s obligations to his

or her former client. See Oasis West Realty, LLC v.

Goldman, 51 Cal.4th 811 (2011).


Social Media – Deletions

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%27. A lawyer may counsel a client to

take down social media postings to

remove embarrassing or incriminating

information even though litigation is

pending, but the lawyer must counsel

the client to preserve the removed

material.


Social Media – Deletions

A. True (Deal). The material must be preserved, but need

not continue to be publicly available. See NYCLA Ethics

Opinion 745 (2013).


Social Media – Discovery

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%28. A lawyer may “friend” a

represented party in order to gain

access to the person’s social

media site as long as the lawyer

does not communicate directly

with the party.



B. False. Seeking to friend a represented party would

violate the no-contact rule, Model Rule 4.2 (California

Rule 2-100). However, a lawyer may access publicly

available information even if the person is represented.



29. A lawyer may “friend” a third

party that is not represented so

long as the lawyer uses his or her

real name when making the

friending request.

A. True (Deal)

B. False (No Deal)


True (D

eal)

False

(No D

eal)

50%50%


B. False (No Deal). Some ethics opinions have

considered it deceptive if the lawyer also does not

disclose the reason for the friending request. San Diego

Bar Ethics Opinion 2011-2 and Philadelphia Bar Ethics

Opinion 2009-2. But see NY City Bar Ethics Opinion

2010-2 concluding that as long as the lawyer uses his or

her name the friending request is proper.


Internal Investigations

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%30. Putting in writing the results of

an investigation that uncovered

harmful information to the

corporate client can violate

corporate counsel’s obligations to

his or her client.


Internal Investigations

A. True (Deal). See D’Andrea v. Epstein, Becker, Green,

Wickliff & Hall, PC, 418 S.W.3d 791 (Tex. App. 14th Dist.

2013). Outside counsel, at the request of inside counsel,

put a damaging oral report in writing. The outside law firm

was aware that inside counsel was assembling

information to use against the company when inside

counsel asked that the report be put in writing. The court

found that the company had a claim against outside

counsel for putting the report in writing under these

circumstances.


Outsourcing – Supervision

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%31. If inside or outside counsel

outsources legal work overseas to

non-lawyers, the outsourcing lawyer

remains ultimately responsible for the

work and must rigorously supervise it.


Outsourcing – Supervision

A. True (Deal). The lawyer otherwise would be assisting a

non-lawyer in the unauthorized practice of law. The

attorney’s obligation of competence also mandates

supervision. Many state bars have opined on attorney

obligations when outsourcing. See, e.g., Virginia State

Bar Ethics Opinion 1850 (2010).


Bonus

A. True (Deal)

B. False (No Deal)

True (D

eal)

False

(No D

eal)

50%50%

32. California is the only U.S.

jurisdiction that has not adopted

the Model Rule format for its Rules

of Professional Conduct.


Bonus

B. False (No Deal). California, in 2002, began working on

rules that followed the Model Rules format, but in 2014 the

proposed new rules were rejected and a new commission

was established to issue another set of proposed rules by

March 2017. The only other jurisdiction that does not have

the Model Rules format is Puerto Rico. In 2013, the

Supreme Court of Puerto Rico also rejected a proposal to

adopt the Model Rules format (the project to revise the

ethics rules in Puerto Rico commenced in 2005). Puerto

Rico has a variation on the 1908 ABA Canons!


Team Scores

Points Team Points Team


Pillsbury Winthrop Shaw Pittman LLP

New York

David KeykoPartner/Litigation

Documents

The Decade’s Important Ethics Opinions, an Ethics Quiz … · The Decade’s Important Ethics Opinions, an Ethics Quiz Show … or, ... An Ethics Quiz Show. Historical Question