Bar News - November 16, 2012
Ethics Corner: Timely Screening for Lateral Hire Conflicts
Dear Ethics Committee:
I am moving as a lateral hire to a new law firm whose clients are adverse to some of the existing clients in the old firm. The new firm is establishing a screening process that would allow me to join the firm without creating a disqualifying conflict of interest for its existing clients who are adverse to my old firm’s clients. The new firm plans to finalize all of the screening procedures as soon as I start working there, but do you think that would be too late?
Yes, that would too late. The screening process must be in place before you start your new employment.
Newly enacted Rule 1.10(c) under New Hampshire’s Rules of Professional Conduct allows a law firm to screen a newly hired lawyer from certain matters where she would be otherwise be disqualified under the conflict of interest rules under Rule 1.9, with the disqualification "imputed" to all others in the firm. Assuming that you and the new firm have already detected and resolved any disqualifying conflicts of interest, proper screening permits the remaining members of the new firm to undertake or continue representation. Under Rule 1.0(k), "screening" denotes the isolation of a lawyer from any participation through the "timely imposition of procedures" within a firm that are reasonably adequate under the circumstances, to protect information that the isolated lawyer is obligated to protect.
Also, under Rule 1.10, screening from any form of participation in the matter must be "timely" to avoid disclosure of a former client’s confidential information. See Rule 1.10(c).
It would not be possible to comply with the screening procedures required under Rule 1.10(c) if the firm waited to establish or implement the procedures. First, if you are personally disqualified, you are required to provide your former client or her counsel, if she is represented, with an affidavit attesting that you will not participate in the matter and will not discuss the matter with any other firm members or employees. Second, at least one partner/shareholder in the new firm must also provide an affidavit attesting that all firm members and employees are aware of the requirement that you must be screened from participation in and discussions about the matter. The partner/shareholder must also describe in the affidavit the procedures being followed to screen you and must agree to respond to any objections about the screening procedures adopted by the firm.
Therefore, unless the screening procedures are in place before you begin working in the new firm, you will not have a basis to provide your own affidavit and the firm will not be able to provide an affidavit to the former client on the procedures that have been put in place to avoid disqualification. Unless the screening procedures are in place and the required affidavits are provided before you start working in the new firm, you would risk violation of both conflicts and confidentiality rules and the new law firm would risk the possibility of mandatory withdrawal from ongoing matters.
Timeliness of screening is only one issue that migrating lawyers and hiring law firms face. A more difficult issue arises with regard to disclosure of client information for purposes of detecting and resolving conflicts of interest before hiring decisions are made. The Ethics Committee will address disclosure of conflict information under Rule 1.10 in a future commentary.
The Ethics Committee provides general guidance on the New Hampshire Rules of Professional Conduct and publishes brief commentaries in the Bar News. New Hampshire lawyers may contact the Ethics Committee for confidential and informal guidance on their own prospective conduct or to suggest topics for Ethics Corner commentaries by emailing Robin E. Knippers.