ABA ammends Model Rule of Professional Conduct at February Boston meeting

Issue April 2009 By Roberta Holland

The vote has been tallied, but the debate still rages on over the American Bar Association’s amendment to its ethics rules regarding lawyers who change firms.

The ABA House of Delegates amended the Model Rule of Professional Conduct at its February meeting here in Boston. The change endorses the use of screens when a lawyer moves from one law firm to another, and the new firm is opposing a former client. Intended to protect former clients’ confidentiality, the screen also prevents conflicts of interest from being imputed to other lawyers in the new firm. Clients do not need to consent to the screen.

After a contentious debate, the proposal was approved in a 226 to 191 vote. A substitute proposal to endorse screening only in cases in which the lawyer was not substantially involved, which mirrors the law in Massachusetts, was voted down.

 While the ABA’s Model Rules are advisory in nature, many lawyers said the rules do influence laws that jurisdictions adopt. Twenty-four states already use screens in some form, and the ABA had rejected similar proposals in the past.

“I think (the debate) absolutely is not over,” said Lucian T. Pera, a member of the ABA House of Delegates who supported the change. “The fact that the ABA had this yearlong debate on screening, regardless of how it came out, I think is going to have an effect on a lot of states.”

Pera, a partner with Adams and Reese LLP in Memphis, said Tennessee has allowed screening since the late 1980s. Initially, the state had a policy similar to the one adopted by the ABA, then moved to a more restrictive policy. But Pera said the bar will consider whether to go back to its Supreme Court in light of the ABA’s action.

Whether the ABA vote will prompt Massachusetts to revise its own policy remains to be seen, said Andrew L. Kaufman, a professor and vice dean for academic programming at Harvard Law School. He is also chair of the MBA’s Committee on Professional Ethics.

Kaufman is on the SJC committee that recommends rule changes. He said he expects that “sooner or later” the committee will consider whether to revisit the issue.

Kaufman was not a personal supporter of the amendment. He said problems could occur when a large firm winds up with dozens of screens in place at once. “The more that are in effect, it seems to me, the more likelihood a breakdown will occur,” he said. That raises questions of if there is a breakdown, whether lawyers will own up to it.

Breakdowns of screens do not have to be malevolent, Kaufman added.

“It’s not even a question of trust; it’s a question of things happen,” he said. “People speak when they shouldn’t.”

Leading the battle against the change was Lawrence J. Fox, a partner with Drinker, Biddle & Reath in Philadelphia and a lecturer at Harvard Law School. It was Fox who proposed the alternative amendment on behalf of the ABA’s Section on Litigation.

“I think it’s an assault on clients,” Fox said. “I haven’t gotten over it. It was a very black day at the ABA.”

Fox believes clients will be justifiably worried when lawyers change firms. Moving lawyers would have a powerful incentive to share information to earn favor with their new colleagues, and it would be very difficult to prove, he said.

“While it is true most lawyers are trustworthy, a significant percentage of them are not,” Fox said. While the previous policy may have been inconvenient, Fox believes it was a minor price to pay. “I turn down more work than I accept because of conflicts. It’s just a part of life.”

Imputing conflicts to all lawyers in a firm was causing increasing difficulty because law firms are getting so large, said Andrew Perlman, a professor at Suffolk University Law School. Odds were higher there would be some conflict between a newly hired attorney’s former clients and someone in the firm. If the former client didn’t waive the conflict, the new firm might drop its client or not hire the lawyer.

“Not having a screen provision was viewed as a potentially significant impediment to lawyers’ ability to move from one firm to another,” Perlman said.

Pera added that there are more interests at stake than just the moving lawyer and the former client. The issue also concerns the new law firm and its clients. He rejected the notion of basing regulations on what he called the lowest common denominator.

“I can’t imagine that we would ever want to — or could — write ethics rules for lawyers based on the assumption that lawyers are not going to follow the rules,” Pera said. “What kind of sense does that make?”