Washington Lawyer

Legal Ethics: Opinion 296: Joint Representation: Confidentiality of Information

From Washington Lawyer, November 2003

(The November 2003 “Speaking of Ethics” column discussed Opinion 296. Opinion 296 addresses the issues attendant to a joint representation of more than one client where actual or potential divergent interests ensue. Rules 1.6 (Confidentiality of Information) and 1.7 (Conflict of Interest are central, but other rules also pertain.)

The inquirer, a private law firm (“Firm”), has asked whether it is allowed or obligated to advise an employer, who paid the law firm to obtain a work trainee visa from the Immigration and Naturalization Service (“INS”) for its alien employee, of its subsequent discovery that the employee had fabricated the credentials that qualified her for the visa.

The Firm desires to advise fully at least the petitioning Employer of the alien employee’s falsification. However, it does not wish to violate any duty under Rule 1.6 to protect client confidences or secrets that may exist between the alien and the Firm. .. The Firm suggests that the retention may have ended once the visa and extension were obtained.

… (T)he alien and the Employer are each entitled to the protection of Rule 1.6. Rule 1.6 prohibits in relevant part 1) disclosure of client confidences and secrets and 2) the use of a confidence or secret of the lawyer’s client to the disadvantage of the client. A threshold question is whether the alien’s spontaneous statement that she had lied is a “confidence or secret” within the meaning of the Rule. …

Based on the facts provided by the Firm, there is some question as to whether the alien employee’s disclosure would qualify as information protected by the attorney-client privilege in that the communication may not have been made in order to obtain legal advice. This is a legal question beyond the Committee’s purview because questions of privilege arise under the law of evidence, not the Rules of Professional Conduct.

It does appear, however, that the information is a “secret” for purposes of Rule 1.6 in that the information was obtained in the course of the professional relationship and disclosure, at a minimum, would be embarrassing and would likely be detrimental to the client.

…No matter how consistent the apparent interests of clients in a joint representation may appear at the onset, however, such a relationship poses inherent risks of future conflicts of interest. Such conflicts arise under Rule 1.7(b)(2) and (b)(3), where the representation of one client would be, or is likely to be, adversely affected by the representation of another client.

By way of analogy, Rule 2.2, which addresses the lawyer’s role as intermediary, provides guidance. …In a joint representation, a lawyer owes ethical duties of loyalty and confidentiality, as well as the duty to inform, to each client. A joint representation in and of itself does not alter the lawyer’s ethical duties to each client, including the duty to protect each client’s confidences. … .

Because of this “delicate” ethical balance, Rule 2.2. generally requires the lawyer to provide “both clients with an explanation in writing of the risks involved in the common representation and of the circumstances that may cause separate representation later to be necessary or desirable. The consent of the clients shall also be in writing.” Rule 2.2(b)…

Rule 1.6 allows disclosure of client confidences “with the consent of the client affected, but only after full disclosure to the client.” The prudent course for a lawyer undertaking a joint representation is to address the issue of disclosure at the outset of the retention and to obtain written consent from both clients that the lawyer may divulge to each client all confidences received during the course of the retention that relate to the representation. See Rule 2.2.

Where consent is sought at the outset of a joint representation, the lawyer must assure that the client has been advised of the potential adverse consequences of any such consent.

… At the same time that the law firm owed a duty to maintain the employee client’s confidences and secrets, it owed the Employer client a duty under Rule 1.4 to keep it “reasonably informed” about the status of the representation. Rule 1.4(a). Comment [3] to Rule 1.4 explains that: “The guiding principle is that the lawyer should fulfill reasonable client expectations for information consistent with (1) the duty to act in the client’s best interests, and (2) the client’s overall requirements and objectives as to the character of representation.”

Where duties to the two clients conflict, and no advance consent has been obtained, the law firm should make an effort to fulfill its duties to the employer by seeking the employee’s informed consent to divulge the information. In the alternative, the Firm should encourage the employee client to divulge the facts to the Employer client. The Firm’s fiduciary duty to the Employer requires an affirmative effort to achieve disclosure within the bounds of Rule 1.6 before withdrawing from the representation.

. . . (T)he mere fact that the Firm was jointly representing the alien employee and the Employer does not provide a basis to infer consent to disclosure of confidences. D.C. Bar Op. 290 (1999). …

None of the other exceptions set forth in Rule 1.6 applies. Thus, absent client consent, the Firm may not divulge the secret. …

Rule 1.7(b) prohibits a lawyer from representing a client with respect to a matter if the representation of another client “will be or is likely to be adversely affected by such representation.” …(T)he lawyer must withdraw from representing both clients unless the retainer agreement permits the firm to continue representing one of the parties. Rule 1.16(a)(1).

Rule 1.6 does not prohibit giving notice of the fact of withdrawal to parties other than the client “without elaboration.” … In terminating the relationship with the Employer, the Firm can advise the Employer that the relationship with the employee client was terminated. While the Rules do not address what can be said to a client as to the basis for terminating the relationship, the Employer client is entitled to know at least what ethical provision led to the termination.

The question arises whether in notifying the Employer, the Firm may engage in a so-called “noisy” withdrawal. Comment [19] to Rule 1.6 provides that after withdrawal under Rule 1.16(a)(1), the lawyer “may retract or disaffirm any opinion, document, affirmation or the like that contains a material misrepresentation by the lawyer that the lawyer reasonably believes will be relied upon by others to their detriment.” (emphasis added) Thus, a lawyer may signal that a problem exists by disaffirming earlier written statements but only if there is a reasonable basis to expect that future harm may occur without such disavowal. …

Inquiry No. 98-11-31
Adopted: F