Risk Update

Risk Reading — Judge’s Judgement on Realtionship-driven Recusal, Attorney Public Bio Risks and Responsibilities, Regulator Risk, Accountant-Client Privilege

The aptly named Meatingplace, which bills itself as “the premier multimedia information source for the red meat and poultry processing industry” noted: “Federal judge offers to step down in poultry antitrust case” —

  • “A federal judge offered to recuse herself from an antitrust case after a lawyer from the judge’s husband’s former law firm made an appearance on behalf of Cargill Meat Solutions, which is a defendant.”
  • “Maryland District Judge Stephanie A. Gallagher submitted a letter last week disclosing the connection and offered to step down if either side felt her objectivity was compromised.”
  • “Judge Gallagher said her husband has not worked for WilmerHale for more than three years, but made a capital contribution to the firm, of which a small percentage remains. She added that will be fully paid back to him by the end of this calendar year and that the capital contribution has not affected in any way by the firm’s success or profits.”
  • “The judge said she believes this connection does not disqualify her from presiding over the case but wanted to leave it up to the parties to decide.”
  • “The United States Department of Justice filed a lawsuit against Cargill and several other poultry producers for allegedly monopolizing trade. The DOJ claimed the poultry processors agreed that they would assist each other by discussing and sharing information about how to compensate their plant workers.”

Avoiding Ethical Risks in Your Online Bio” —

  • “Whether through a law firm’s website or through a social media platform like LinkedIn, a lawyer’s online profile is often the first resource available to potential clients, opposing counsel, or others in the field when they want to learn more about a lawyer… But there are also ethical requirements that lawyers should keep in mind when revising and publishing their online bios. Here are three issues every lawyer can consider when reviewing and updating their online bios.”
  • “California has some of the strictest rules on client confidentiality in the country. Business and Professions Code Section 6068(e) requires every lawyer ‘to maintain inviolate the confidence, and at every peril to himself or herself to preserve the secrets, of his or her client.’ Rule 1.6—the ethical rule on confidentiality—then incorporates that obligation, providing that lawyers shall not reveal information protected by that statute.”
  • “For lawyers drafting their online bio, they may need to consider whether publishing information about their prior representations runs afoul of this rule. The ABA’s Standing Committee on Ethics and Professional Responsibility’s Formal Opinion 480, from 2018, confirms the need to protect clients’ confidential information in online formats. The opinion states that, even if there is information about a client in a court’s order or other public record, the lawyer’s duty of confidentiality still applies to ‘information related to a representation, whatever its source and without regard to the fact that others may be aware of or have access to such knowledge.'”
  • “Thus, just because a fact relating to a representation is publicly available does not mean that the lawyer is free to publish it in a bio absent express or implied client consent. The opinion advises: ‘Rule 1.6 does not provide an exception for information that is ‘generally known’ or contained in a ‘public record.'”
  • “Notably, even an accurate statement about a past representation could still be viewed as misleading to prospective clients, if the statement suggests that the results could be repeated for another client. The comments to Rule 7.1 indicate that, in order to avoid creating an ‘unjustified expectation,’ lawyers generally exclude from their bios information about a specific amount of damage award, the lawyer’s record in obtaining favorable results, and client endorsements. Lawyers who describe the outcomes of their cases in this way (which is more common for plaintiff’s-side lawyers) may also consider using a disclaimer or other clarification to note that the outcome of any single representation will depend on the facts and circumstances.”

You Keep Using That Word, I Do Not Think It Means What You Think It Means: Accountant-Client ‘Privileged’ Communications May Not Be Privileged as a Conflict of Law Matter” —

  • “In Florida, the legislature deemed open dialogue between an accountant and a client so important that, in 1978, it adopted a privilege nonexistent in the common law: the accountant-client privilege.”
  • “Akin to the attorney-client privilege, the privilege permits a client ‘to refuse to disclose, and to prevent any other person from disclosing, the contents of confidential communications with an accountant when such other person learned of the communications because they were made in the rendition of accounting services to the client.'”
  • “Cases applying section 139 to a conflict of law regarding the accountant-client privilege, in Florida state court, are nearly nonexistent. In fact, the authors of this article are aware of only one such decision, in which they participated — Schaeffer v. Dowling & Hales LLC.”
  • “The court began its analysis by noting that a conflict existed because Florida (the forum) recognized the accountant-client privilege while California (the state where the communications occurred) did not. From there, the court noted that Florida applies the “‘interest analysis methodology’ for determining choice of law questions,” and then quoted section 139.[6] The court went on to apply section 139 in the context of the accountant-client privilege, and relied on an example given by section 139 of when not to recognize a privilege.”
  • “There is a sizeable body of case law from courts across the country applying section 139 of the Restatement (Second) of Conflict of Laws.[9] Importantly, section 139 favors disclosure when there is a conflict. Thus, litigants should be aware of the pitfalls and opportunities presented when faced with privileges arising in a conflict-of-law context.”

“‘Conflict of interest’: Watchdog berates Holyrood plan to keep Law Society as regulator” —

  • “Britain’s senior consumer watchdog has strongly criticised plans by the Scottish government to allow the Law Society of Scotland to carry on regulating the nation’s 13,000 solicitors. The Competition and Markets Authority reiterated its call for a new regulator north of the border that is properly independent of both the legal profession and government.”
  • “The CMA’s plea is contained in its consultation response to The Regulation of Legal Services (Scotland) Bill, which was introduced to the Scottish Parliament in April this year. The bill aims to ‘modernise’ the regulation of legal services in Scotland, informed by a Scottish government-commissioned independent review led by governance expert Esther Roberton.”
  • “Crucially, the Scottish government rejected a principal recommendation of Roberton – the creation of a single independent regulator – in favour of an approach that would ‘seek to develop the existing regulatory framework.'”
  • “In truth, the 2018 Roberton report was merely the latest chapter in a saga that has lasted for nearly three decades. As the CMA acknowledges, there have been many alleged examples where conflicts of interest ‘may have led the Law Society of Scotland and the Faculty of Advocates to prioritise the interests of their members over those of consumers.'”
  • “The Society and Faculty have lobbied ferociously to retain control of regulating their members, occasionally in the face of allegations of a conflict of interest from disgruntled clients. Such allegations have been periodically raised in the Scottish Parliament, including by John Swinney MSP who rose to become deputy first minister. So far the bodies, which wield considerable power in Scottish civil society, have succeeded in their aim. This marks a stark contrast with their counterparts in England and Wales, where the representative and regulatory functions were formally split more than 15 years ago.”
  • “The Scottish government’s chosen model contains new safeguards, including bolstering the independence of the Society’s regulatory committee. But the CMA says today: ‘The experience in England and Wales illustrates that any incomplete separation has the potential to give rise to an inherent conflict between the responsibility to regulate in the consumer interest and the responsibility to represent the interest of their members. That has the potential to affect regulatory outcomes.'”