“Sidestepping Conflicts and Other Ethical Pitfalls in Employee Depositions” —
- “Quite often corporate employers want outside counsel to represent both the corporation and potential employee-witnesses during pretrial discovery depositions. Conflicts of interest are obviously lurking in these scenarios, although, in the case of current employees — particularly current management employees — the likelihood of an ethical misstep is small. In fact, a lawyer’s representation of current, highly placed corporate employees will have the effect of protecting with attorney-client privilege information they provide to the corporation’s attorney.”
- “The real problems arise when a corporation’s attorney seeks to represent both the corporation and former employees who may possess information adverse to the corporation and may even be facing personal liability themselves.”
- “The recipe for ethically representing a nonparty witness at a deposition in a case in which the lawyer also represents a party (usually a corporate employer) has four ingredients:
- Limited Scope Representation. Representing the witness during a deposition could be a “limited scope representation,” meaning that the lawyer would provide some, but not all, of the legal services that attend a traditional lawyer-client relationship. “Limited representation” could include no more than a pre-deposition preparation session and legal advice on whether the witness’s testimony could subject him or her to criminal or civil liability. Any limitations on the usual attorney-client relationship would have to be reasonable under the circumstances.
- Is There a Conflict? Can It Be Waived? The lawyer should next consider if representing the witness creates a conflict of interest with the corporate client. If so, and if the conflict can be waived, the lawyer must obtain signed, written conflict waivers from both the witness and the corporate client. The lawyer’s ethical obligation to inform both clients about the possibility that conflicts of interest may arise, to independently monitor the case for conflicts of interest, and to address these conflicts continues throughout the litigation.”
- “Even though it is not necessarily an ethical violation for a corporation’s lawyer to also represent an employee witness at a deposition, in reality, most witnesses likely possess information that is unfavorable to the corporation’s case, thus creating a strong potential for a conflict of interest. It can be very difficult for the lawyer to determine the witness’s full knowledge before the deposition.”
- “Finally, if a conflict arises, it can be waived only if the witness gives informed consent to representation despite the conflict. Informed consent means that the witness must be advised of all of the negative consequences that could occur as a result of his or her testimony.”
“CapRadio audit details ‘possible conflicts of interest’ for 5 ex-board members. Here’s who they are.” —
- “An audit released this week into financial practices at Capital Public Radio flagged five contracts involving possible conflicts of interest on the part of five different former board members — three more than previously known to the public.”
- “The forensic analysis released Monday of finances at CapRadio, an auxiliary of Sacramento State, found that those three board members were “either a founder or a partner” at businesses that entered into contracts with the station totaling tens of thousands of dollars.”
- “‘As such, the contracts with CPR may have provided a financial benefit to the Board members associated with each vendor,’ part of the audit reads.”
- “Two of the three board members are partners at two different law firms with offices in Sacramento, according to the audit. The third is the founder of a management consulting firm. All three were among the 14 board members who resigned last October, days after a separate audit revealing vast financial mismanagement was released by the California State University system.”
- “The [Sacramento] Bee determined the identities of two other board members, both attorneys, based on the descriptions of their law firms and their roles described in the audit. “
- “A person knowledgeable of CapRadio’s finances, who wished to remain anonymous because the person was not authorized to speak about the matter, confirmed the identities of those two, as well as the board member who runs a consulting firm.”
- “From January 2019 until May 2023, Downey Brand was paid more than $42,000 for legal services related to ‘lease negotiations,’ the audit said.”
- “However, CLA did not determine whether Clark recused herself from the discussion and votes pertaining to the contract, the audit said.”
- “The audit noted the payments ‘appear reasonable based on the stated services rendered’ for this contract.”
- “‘There may be another contract with (Downey Brand) in addition to the contract CLA reviewed,’ the audit states. ‘However, Sacramento State has been unable to locate any other contracts and no further outreach was made to (Downey Brand).'”
- “Another law firm, Stoel Rives, was paid more than $11,000 for two years while a CapRadio board member was employed at the firm.”
- “Stoel Rives, through a Portland-based attorney, helped CapRadio file a trademark application in 2021, according to the U.S. Patent and Trademark Office.”
- “The station entered into a contract with Stoel Rives in October 2020 for “legal services” related to trademark matters, the audit said.”
- “The audit noted that the ‘payments and contract appear reasonable for the stated services.'”
- “The discussions surrounding the contract were not noted in the minutes from the Board of Directors meeting, executive or the finance committees, the audit said.”
- “Though [General Manager] Eytcheson said the contracts were properly vetted, the 2023 financial audit by the CSU said annual documents that were supposed to track board members’ conflicts of interest could not be located.”
- “‘Conflict‐of‐interest (COI) statements for board members were not retained,’ a portion of last year’s audit reads, in part.”
- “‘The COI policy states that members of the board should complete an annual COI statement. However, CPR could not locate signed statements during the audit period because the staff member responsible for maintaining the statements was on sabbatical leave.'”