State Bar Ethics Opinions cite the applicable California Rules of Professional Conduct in effect at the time of the writing of the opinion. Please refer to the California Rules of Professional Conduct Cross Reference Chart for a table indicating the corresponding current operative rule. There, you can also link to the text of the current rule.
May an attorney ethically represent a client in a claim against clients of a former legal partner?
An attorney may ethically represent a client in a claim against clients of a former legal associate when that legal association was formed after the representation of the former clients and there is no evidence that any confidence or secret of the former clients was discussed or revealed by the former legal associate.
Rule 4-101 of the Rules of Professional Conduct of the State Bar.
We have been asked whether an attorney may ethically represent a client in a claim against two clients of that attorney's former associate. The sequence of material events is:
1) Two men contact attorney A to draft, among other things, a joint venture agreement. The agreement is drafted and further representation of the two is limited to the receipt of some monies which are deposited and maintained on behalf of the clients in a trust account.
2) Thereafter Attorney B associates with Attorney A and remains with him for about a year. During that association, Attorney B did no work on the joint venture file, and there were no proceedings or discussion involving the two clients or their joint venture.
3) After leaving the association with Attorney A, Attorney B formed another partnership. He has now been asked to represent a client who has a potential claim relating to the joint venture against the two men who formed the joint venture.
4) The two men object to Attorney B's representation of their adversary.
In relevant part, rule 4-101 of the Rules of Professional Conduct provides:
".. a member of the State Bar shall not accept employment adverse to a ... former client ... relating to a matter in reference to which he has obtained confidential information by reason of or in the course of his employment by such o.. former client."
The facts we are given make it clear Attorney B obtained no confidential information regarding the two men during his association with Attorney A. Are the clients' confidences and secrets revealed to Attorney A to be imputed to Attorney B so as to bring him within the prohibition of rule 4-101 of the Rules of Professional Conduct? We think not.
We agree with the rationale which supports the presumption that there is a free flow of information between members and associates of a legal firm. (See Laskey Bros. of W.Va., Inc. v. Warner Bros. (2nd Cir. 1955) 224 F.2d 824.) But this presumption should not be applied to reach illogical conclusions. In Silver Chrysler Plymouth, Inc. v. Chrysler Mot. Corporation (2nd Cir. 1975) 518 F.2d 751, 753, the court, in declining to disqualify an attorney whose prior involvement with the party he was now suing was far greater than that of the attorney in this situation, observed:
" .... it would be absurd to conclude that immediately upon entry on duty [attorneys] become the recipients of knowledge as to the names of all the firm's clients, the contents of all files relating to such clients, and all confidential disclosures by client[s] . .. to any, lawyer in the firm. Obviously such legal osmosis does not occur." 1
In California the courts have not held that the presumption of free sharing of information among members of a firm or partnership is conclusive in the absence of evidence of a substantial relationship between the pending litigation and the matters upon which the attorney worked during the prior association. (See, e.g., Kraus v. Davis (1970) 6 Cal.App.3d 404 [85 Cal. Rptr. 846]; In re Charles L. (1976) 63 Cal. App.3d 760 [132 Cal. Rptr.840]. In a similar vein, see Novo Terapeutisk, Etc. v. Baxter (7th Cir. 1979) 607 F.2d 186.) We agree with this practical approach to the application of the rules.
To breach rule 4-101 of the Rules of Professional Conduct, an attorney must have obtained, directly or indirectly, confidential information or secrets about his or her former client which are involved, directly or indirectly, in the claim being pursued against that client. As noted above, there may be a presumption of free flow of information between members anti associates of a legal firm. Accordingly, an attorney, approached by a client with a claim against another client of a firm with which the attorney was previously associated, should not take the case unless he or she would be able, if called upon to do so, to testify that no confidences or secrets came to him or her or that any information he or she did obtain has no substantial relationship to the new litigation. In these events, the presumption would be overcome and rule 4-101 would not be an ethical bar to accepting the new case.
Canon 9 of the American Bar Association Code of Professional Responsibility provides: "A lawyer should avoid even the appearance of professional impropriety."
Even if Attorney B commits no breach of rule 4-101 of the Rules of Professional Conduct by accepting the client who now challenges the joint venture agreement, does canon 9 of the
American Bar Association Code of Professional Responsibility preclude his or her representation? Again, we think not.
In Younger v. Superior Court (1978) 77 Cal.App. 3d 892 [144 Cal. Rptr. 34], the Court of Appeal for the Second Appellate District upheld, for appearances sake, a recusal order of the entire Los Angeles District Attorney's Office in cases against clients of a firm after one member of the firm had resigned to become the third ranking district attorney with responsibilities in formulating prosecutorial policy and in evaluating the performance of attorneys, some of whom would have presented cases against clients of his former firm. The appellate court found the attorney's position "could possibly affect the prosecution" of those clients and that persons "of a paranoid and conspiratorial turn of mind" would never be satisfied that there had been no impropriety. Younger v. Superior Court, supra, followed a number of cases in which California courts dealt with the need for the "highest degree of integrity and impartiality, and with the appearance thereof" in the criminal justice system. (People v. Municipal Court (Wolfe) (1977) 69 Cal. App.3d 714 [138 Cal. Rptr. 235], People v. Superior Court (Greer) (1977) 19 Cal.3d 255 [137 Cal. Rptr. 476], People v. Rhodes (1974) 12 Cal.3d 180 [115 Cal. Rptr. 235].)
None of these cases, however, involved the right of individual clients freely to select the attorneys they wish to represent them. (See, e.g., Silver Chrysler Plymouth, Inc., supra, 518 F.2d 751.) This critical and significant right, when balanced against the desirability of the profession to remain above suspicion of imagined improprieties, even by those "of a paranoid and conspiratorial turn of mind," leaves us to conclude that, in this case, the right of free selection should prevail and that the concept behind canon 9 of the American Bar Association Code of Professional Responsibility (which is not binding in California) should be applied in situations in which public confidence in the integrity of the legal profession would clearly be shaken by the attorney's representation of the new client. Courts have found these conditions do exist when an attorney represents a personal injury client's wife in a dissolution of marriage suit against the client without the client's consent (Jeffry v. Pounds (1977) 67 Cal. App.3d 6 [136 Cal. Rprt. 373]) or when an attorney changes sides in a factually related case (Trone v. Smith (9th Cir. 1980) 621 F.2d 994).
We do not see that situation in the set of facts we have been given. In essence, Attorney B once had physical access to the file involving the two clients in a joint venture, and nothing more. In a similar setting, the court of appeals reversed an order of disqualification in Gas-A-Tron of Arizona v. Union Oil (9th Cir. 1976) 534 F.2d 1322. There is nothing in the facts presented here suggesting a division of loyalty or side switching.2 Accordingly, we find no breach of canon 9 of the American Bar Association Code of Professional Responsibility.
This opinion is issued by the Standing Committee on Professional Responsibility and Conduct of The State Bar of California. It is advisory only. It is not binding upon the courts, The State Bar of California, its Board of Governors, any persons or tribunals charged with regulatory responsibilities, or any member of the State Bar.
1 We recognize that Silver Chrysler Plymouth, supra, was overruled in Armstrong v. McA1pin (2nd Cir. 1980) 625 F.2d 433 on an unrelated issue.
2 In contrast to this Committee's opinion No. 1980-52, it is neither reasonably foreseeable, nor would it reasonably appear to the two clients, that confidences or secrets of those clients may be used by Attorney B. At no time did Attorney B have discussions involving the two clients or their joint venture nor did Attorney B do any work on the joint venture file. Presumably the file remains in the possession of Attorney A. This is in sharp contrast to the situation in opinion No. 1980-52, wherein the first client would be aware of prior representation by the same governmental entity which the client knows had a file relating to the client's case.