Risk Update

RIsk Roundup — Lawyer Conflict Advising “Side Business,” Firm’s “Brand Ambassador” Spokesperson Causes Consternation, A Judge’s Alleged Poor Judgement

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NJ Atty Can’t Use Own Firm To Advise Side Business” —

  • “The New Jersey Advisory Committee on Professional Ethics on Friday released an opinion finding that a Garden State attorney who owned a business in addition to his legal practice created a conflict of interest impacting his entire firm when he retained his own firm to perform legal work for an entity owned by his business.”
  • “The committee received an inquiry about a law firm that was retained to advise a client entity in a commercial loan refinancing, according to the opinion. The client entity is fully owned by a limited liability company that has two members, each owning equal shares.”
  • “Since the attorney owns an equal part of the parent company, the attorney also owns 50% of the client entity, the committee found. The financial stake created a ‘personal interest’ on behalf of the lawyer, the committee said.”
  • “‘It is well-established that lawyers who have a personal financial interest in a client’s business have a conflict of interest,’ the committee wrote. ‘A lawyer’s professional judgment, when advising a client in a financial transaction, could be influenced by the lawyer’s interest as a stakeholder in the business.'”

U.S. law firm is latest to pull golf sponsorship over Saudi-backed tour” —

  • “U.S. law firm Cozen O’Connor said Thursday that it has dropped its sponsorship of golfer Jason Kokrak after he left the PGA Tour to join the Saudi Arabia-backed LIV Golf Invitational Series.”
  • “The move comes amid a wider rift in the professional golfing world over the new LIV Golf series, which has lured players with the promise of guaranteed, big-money paydays and a reduced schedule.”
  • “Cozen said Thursday that it had ‘mutually agreed’ with Kokrak that he will no longer serve as an ‘ambassador’ for its brand, citing Kokrak’s decision Wednesday to affiliate with the new LIV tour.”
  • “Forbes reported in June that Rocket Mortgage, the Royal Bank of Canada and UPS had dropped players for their involvement with LIV Golf. Accounting firm KPMG ended its sponsorship of Phil Mickelson in February over comments he made about the Saudi backing of the LIV Golf series.”
  • “In addition to concerns over the future of the PGA Tour, critics say LIV Golf, which is bankrolled by Saudi Arabia’s Public Investment Fund, amounts to ‘sportswashing’ by a country trying to counterbalance the reputational effects of human rights abuses.”
  • “Cozen, and its founder and chairman Stephen Cozen, represented families of victims of the Sept. 11, 2001, attacks in litigation against Saudi Arabia, alleging it provided material support to al Qaeda.”

For more on the KPMG sponsor change, see this from February: “Mickelson apologises for ‘reckless’ comments on Saudi-backed league” —

  • “In a November interview that was published on the firepitcollective.com last weekend, Mickelson criticised the government of Saudi Arabia for its ‘horrible record’ on human rights, which he said included the 2018 killing of journalist Jamal Khashoggi and the execution of gay people.”
  • “Despite the government’s ‘scary’ actions, he said he would use the prospect of a new, highly-lucrative tour to gain economic leverage over the PGA Tour, a position that drew the ire of fellow golfers including Rory McIlroy and Justin Thomas.”
  • “‘Although it doesn’t look this way now given my recent comments, my actions throughout this process have always been with the best interest of golf, my peers, sponsors, and fans,’ Mickelson said at the beginning of a lengthy social media post, where he claimed his previously reported comments were ‘off the record,’ a charge the journalist denies.”
  • “‘The bigger issue is that I used words I sincerely regret that do not reflect my true feelings or intentions. It was reckless, I offended people, and I am deeply sorry for my choice of words. I’m beyond disappointed and will make every effort to self-reflect and learn from this.'”
  • “Mickelson praised LIV Golf Investments, Super Golf League’s financial backer, and called the people he has worked with there ‘visionaries.'”

Judge Hummel Accused of Intimidating Oil and Gas Counsel” —

  • “An attorney for an oil and gas company has accused Second Judicial Circuit Judge David Hummel of pointing a gun at her and also at her colleagues in his courtroom during a bench trial earlier this year.”
  • “Lauren Varnado, a Texas-based managing partner of the law firm Michelman & Robinson LLP, told The Intelligencer that Hummel had been openly hostile toward her team after they sought to have the judge disqualified from a case in Wetzel County involving oil and natural gas royalty payments.”
  • “The case Hummel was appointed to oversee involved EQT Corp. and local residents over royalty payments. Varnado said she and Hummel had gotten off on the wrong foot, starting with her attempt at having him removed from the case. In 2020, Circuit Judge Jeffrey Cramer had voluntarily recused himself from the matter over a potential conflict of interest. That case then went to Hummel, who Varnado believed may have had a similar conflict of interest.”
  • “The West Virginia Supreme Court of Appeals declined to disqualify Hummel, who Varnado said may have relatives who receive oil and gas payments. Afterward, Varnado said Hummel conducted the legal proceedings with an air of open hostility.”
  • “‘He kind of started [the status hearing] off with, ‘I’m Judge Hummel, and I don’t have any conflicts, nice try,” she said. ‘He turned to the plaintiff’s lawyers and said, ‘This is a bench trial, right?’ and winked at him.'”
  • “By the time the matter had gone to trial earlier this year, Varnado said Hummel’s behavior had become significantly worse, devolving into screaming matches and interrupting opening arguments, among other things. In her affidavit, Varnado also states that Hummel berated and ridiculed counsel throughout the trial, calling her ‘despicable.'”
  • “Varnado also claims that Hummel would gesture toward his stenographer to go on and off the record during the trial, one instance of which was prior to Hummel’s alleged brandishing of a handgun.”
  • “During the hearing, Hummel allegedly told Varnado that the courtroom security officer, and Hummel personally, would be enough security for her team, according to Varnado’s affidavit. Hummel allegedly said that his guns were bigger than the guns of her security personnel before drawing his holstered weapon, pointing it at the defendant’s table where EQT’s legal team was waiting, and then at the podium where Varnado was stationed. Hummel then allegedly laid his weapon on the desk before deliberately rotating the gun so that the barrel was pointing directly at Varnado, she said.”
  • “According to that reporting, Hummel first denied anything had taken place in his courtroom, then called the reporter back later to say he had a gun on his person but never brandished it, then called back again to say he did show Varnado and her team a foil packet of blood coagulant from a first aid kit, but not a gun.”
Risk Update

BRB Law Firm Risk Staffing Compensation Survey — Now Open!

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I’m pleased to invite our law firm risk readers to participate in the 2022 Risk Staffing Compensation Survey.

Designed with input from risk leaders at three firms [Thank you risk braintrust!], this exercise is designed to shed a bit more light on current compensation standards, practices, and trends.

So if you’re an individual contribution looking to understand how your comp compares to your peers, or you’re a risk manager looking to keep your team (and potential new hires) on par with changing market standards, we’re looking to generate some data and benchmarks to help.


  • Participation open to law firm risk professionals only
  • All responses will be treated confidentially
  • Participants will receive a report summarizing key findings and analysis
    • (The report may be shared internally within your firm, but not redistributed externally. So if you want the results, your best path is to participate!)
  • Individual contributors will be asked to share data about their role and compensation
  • Managers of several contributors will be asked to share data on their team members

The survey will be open for the next month and can be accessed here: 2022 Risk Staffing Compensation Survey.

Feel free to share the link with law firm peers and colleagues.

Let’s see what we learn…

jobs (listed)

BRB Risk Jobs Board — (Senior) Business Intake/Conflicts Analyst & Conflicts Analyst Team Lead

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In this BRB jobs update, I’m pleased to highlight two positions open at Blakes, a conflicts analyst role and a team lead position:

Conflicts Analyst Team Lead / Conflicts Analyst Supervisor” —

  • “Blake, Cassels & Graydon LLP (Blakes), one of Canada’s largest and most successful law firms, is currently looking for a Conflicts Analyst Team Lead or Conflicts Analyst Supervisor to join the General Counsel’s Office (GCO) in the Toronto office. Depending on experience, this is a team lead or supervisor role, which will report to the Assistant General Counsel.”

Primary responsibilities of the position include, but are not limited to:

  • Overseeing or supervising the delegation and assignment of tasks to a team of Conflicts Analysts, including corporate research, search strategy and curation of conflict reports using Intapp Open
  • Motivating and supervising the team, while providing coaching and counsel regarding deliverables. Conducting spot checks, providing feedback and applying sound judgment in identifying issues that require escalation to the GCO
  • Designing and leading onboarding and continuing training efforts while promoting best practices with existing and new team members
  • Defining appropriate search parameters, searching multiple databases to identify potential conflicts of interest and other risk issues such as sanctions, and preparing and curating conflict reports for the Firm’s lawyers to review
  • Assisting in the creation of various tracking systems in connection with lateral hires, sanctions and other risk issues, as requested
  • Providing coaching and assistance to legal assistants as needed to ensure all required information for new matter opening is captured and recorded accurately, and information for existing matters is updated in a timely manner

Key qualifications include:

  • Five years + of professional work experience in a law firm required
  • Proficiency with Intapp Open or experience with conflict searches required

See the complete job posting for more detail on job and to apply for this position.


(Senior) Business Intake/Conflicts Analyst” —

  • “Blake, Cassels & Graydon LLP (Blakes), one of Canada’s largest and most successful law firms, is currently looking for a Business Intake/Conflicts Analyst or Senior Business Intake/Conflicts Analyst to join the General Counsel’s Office in the Toronto office.”

Primary responsibilities of the position include, but are not limited to:

  • The timely execution of conflict searches and analysis of search data to ensure a thorough review of potential conflicts
  • Defining appropriate search parameters, searching multiple databases to identify potential conflicts of interest and other risk issues such as sanctions, and preparing and curating conflict reports for the Firm’s lawyers to review
  • Providing coaching and assistance to legal assistants as needed to ensure all required information for new matter opening is captured and recorded accurately, and information for existing matters is updated in a timely manner
  • Applying sound judgement to ensure effective review of conflicts and knowing when to escalate issues
  • For senior role, exhibiting a keen understanding of Intapp Open, and assisting with project-specific testing for new software developments
  • For senior role, providing support and guidance to junior team members, and sharing best practices

Key qualifications include:

  • Undergraduate diploma or degree preferred
  • Three to five years of professional work experience in a law firm preferred
  • For Senior role, working knowledge of Intapp Open and/or experience with conflict searches required

See the complete job posting for more detail on job and to apply for this position.


Learn more about working at Blakes on their careers page:

  • “At Blakes, we are all about our people. We are committed to not only providing exceptional client experiences, but also fostering an open and inclusive workplace culture for legal professionals and administrative professionals.”
  • “As a winner of the Canada’s Best Diversity Employers award, as well as the Greater Toronto’s Top Employers award, we know that diversity and inclusion are not simply initiatives on the perimeter of our business — they are the core of our success. We understand the importance of cultivating an environment that brings out the best in each person. Our success as a Firm starts with the hiring, development and retention of top talent.”

And if you’re interested in seeing your firm’s listings here, please feel free to reach out

Risk Update

Conflicts Considerations — Indiana Advisory Opinion Outlines Law Firm Conflicts “Ethical Minefields”

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Disciplinary Commission publishes advisory opinion on conflicts of interest”

  • “The Indiana Supreme Court Disciplinary Commission has issued an advisory opinion focused on when attorneys must decline to represent a client or withdraw from a current representation due to a conflict of interest.”
  • “‘While realized and potential conflicts inevitably arise in one’s practice, attorneys must be diligent to avoid damaging the interests of those to whom they owe a duty,’ the commission wrote. ‘To that end, it is vitally important that attorneys have a thorough conflicts check procedure in place.'”
  • “‘Conflicts analysis is nuanced and fact specific,’ it continued. ‘Attorneys should carefully evaluate who the actors are and what interests are at stake in a matter. Thought should be given as tohow potentially far-reaching the effects of the representation are to avoid damaging the interests of someone to whom the attorney owes a duty but who may not even be a party to the instant matter.”
  • “In its July 2022 advisory opinion, the commission posed four hypothetical ‘ethical minefields'”:
    • “The first hypothetical situation concerns duties to prospective clients. In that scenario, the commission presented a hypothetical dissolution case in which a wife comes to a law office seeking help and offers material information to an attorney. Ultimately the lawyer isn’t retained, but three weeks later the husband hires the lawyer to represent him in the dissolution proceeding.”
    • “The second hypothetical presents a scenario in which four individuals who form a limited liability company, each owning 25% shares, insist that a lawyer represent each of them individually and agree to waive all conflicts. However, it quickly appears that one of the individuals, individual A, will contribute the lion’s share of monetary funding to start the LLC.”
    • “In the third hypothetical, the Disciplinary Commission gave the example of a lawyer who served as a client’s go-to for all legal questions and representation needs for many years. One day, the client approached the lawyer with an offer: The lawyer would provide legal services to the client’s business, Widget Corp., for two years in exchange for 5,000 shares of stock in Widget Corp. The lawyer accepted the offer and agreed to continue representing the client in his individual capacity in addition to representing Widget Corp.”
    • “In the final hypothetical, the commission gave an example of a conflict that might arise during representation. Specifically, a lawyer has represented Client A, a bricklayer, for years and is currently representing Client A in contract negotiations with a supplier. The lawyer was just hired by Client B, a homeowner, for a potential lawsuit against Client B’s builder due to water seeping into Client B’s home. After Client B’s suit against the builder is filed, the builder files a third-party complaint against Client A claiming that all damage to the home is due to faulty bricklaying. Client A calls the lawyer and asks him to represent Client A in Client B’s lawsuit.”
  • For the Court’s review of those scenarios in detail, see the complete opinion: “Detecting and Navigating Conflicts of Interest.


Risk Update

Judicial DQs — More Motions and Movement to Disqualify Judges

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Why Judges Keep Recusing Themselves From a N.Y.C. Vaccine Mandate Case” —

  • “The city’s teachers, who sued over vaccine requirements, said the judges assigned to the case owned thousands of dollars of Covid-19 vaccine-maker stock, which could affect their rulings.”
  • “Over two weeks, the teachers’ lawyers have asked three successive judges assigned to the case to recuse themselves and have it reassigned. The lawyers cited financial disclosure forms, listing each judge as owning thousands of dollars of stock in Covid-19 vaccine manufacturers, whose share price, they argued, could be helped or hurt by their rulings.”
  • “‘The ownership of this stock constitutes a direct financial conflict of interest in the outcome of this case,’ the lawyers wrote on June 9 to Judge Valerie E. Caproni, the first judge assigned to the case.”
  • “The escalating dispute highlights a question that has drawn increasing scrutiny in the news media, the courts and in Congress: When should judges disqualify themselves from cases?”
  • “Several ethics experts who examined the dispute in the teachers’ case said the successive recusal requests showed how lawyers might find it advantageous to seek a judge’s disqualification if it served a strategic purpose.”
  • “Under the law, judges must step away if they own even one share of stock in a party to a lawsuit, said Stephen Gillers, a professor at New York University School of Law. “The one-share rule is easy,” he said. ‘It’s a bright line. It either exists or it doesn’t exist, and there’s nothing to argue about.'”
  • “In the teachers’ case, however, the parties were public officials and the city education department — not a company. Then, Mr. Gillers said, the question is whether the judge’s financial interest ‘could be substantially affected’ by a ruling, which is vague.”
  • “There was disagreement among the experts over whether the judges needed to withdraw. Rebecca Roiphe, a professor at New York Law School, said it seemed to her that none were required to do so.”
  • “‘The chance that this lawsuit in New York would affect the stock prices of a company like Pfizer, which has a market cap of around $300 billion, are negligible,’ she said. ‘It seems that the judges were instead caving to unreasonable assumptions about their ability to be fair.'”
  • “But James Sample, a Hofstra University law professor, said the issue of appearing impartial is real. ‘Do I think that Judge Caproni and Judge Ramos could have been fair in hearing this case? Absolutely,’ he said. ‘But hearing the case once it was clear that they own significant positions in an interested party fails the optics test. And in recusal law, the optics test matters.'”

Louisville judge disqualified from Breonna Taylor protester cases” —

  • “Kentucky’s Supreme Court has disqualified a Louisville judge from presiding over several cases regarding people who were arrested in the summer of 2020 during a protest regarding Breonna Taylor’s death.”
  • “The court cited Judge Josephine Buckner’s potential bias based on her previous employment and social media posts.”
  • “According to the motion for removal, the prosecution said Buckner should be disqualified from presiding over the protestors’ cases because she worked for Louisville Attorney Sam Aguiar’s law firm while he represented Taylor’s family.”
  • “Other members at the law firm also represented other protestors who had been arrested that summer, the Commonwealth said.”
  • “In response to the prosecution’s affidavit, Buckner confirmed that she did work for Aguiar before her appointment to the bench. However, she says her previous employment with the Jefferson County Attorney’s Office, which defended the civil action regarding Taylor’s death, ‘is as relevant to the present case as her previous employment with the Aguiar firm.'”
  • “The Commonwealth further argued in their motion that Buckner shared three Facebook posts relating to Taylor’s death between August 2020 and June 2021. Three of the posts were made by Aguiar and Lonita Baker, who also represented Taylor’s family.”

Upcoming Webinar — Intapp Risk & Compliance: Partner Perspectives on Navigating the Cloud Migration Journey (Sponsor Spotlight)

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In this month’s sponsor spotlight, Intapp is highlighting an upcoming event sure to be of interest to every customer that has yet to migrate from on-premises to cloud: “WEBINAR: OnePlace Risk & Compliance: Partner perspectives on navigating the cloud migration journey

Event Description:

  • The cloud offers significant advantages for Intapp customers. Don’t miss this session if you’re looking to migrate on-premises Intapp software, business processes. and data integrations to the cloud — or to better understand key steps your organization should be preparing today to smooth an eventual migration down the road.
  • This webinar includes a panel of independent experts representing three key Intapp consulting partners. Each of these partners has executed several cloud projects and will share their experience, advice, recommendations, and tips for navigating the journey ahead, including the following discussion topics.

Panel Discussion Topics:

  • Success stories: Lessons and learnings from successful Intapp cloud migrations
  • Technology preparation: Query integration-to-data sets, API conversion, premigration system updates, data integration re-architecture, and other critical tech concerns
  • Strategy and planning: Making the case to management for investment, including incremental approaches


  • James Edwards, Director of Client Experience, Intapp
  • Shalaka Natu, Director of Product Risk Solutions, Intapp
  • Samantha Kobak, Risk Solution Engineering Manager, Intapp
  • Curtis Russell, Chief Operating Officer, Aurora North
  • Jeff Armbrecht, Vice President, Services, InflectionIT
  • Eric Mosca, Director of Operations, InOutsource

Learn More and Register Here.


Risk Update

Risk Roundup — Understanding “Thorny” Bankruptcy Conflicts and Conflict-related Issues, Law Firm Disqualification

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Lawyer Can’t Have 2 ‘Masters’: A Judge Just Disqualified This New Jersey Law Firm” —

  • “A judge ruled that Pashman Stein Walder Hayden may not concurrently represent a corporation and a part owner in a dispute with another part owner.”
  • “Judge Albert Rivas ruled after plaintiff counsel cited case law finding that a similar arrangement violated the Rules of Professional Conduct.”
  • “The judge also declined bids to quash a subpoena of the plaintiff’s financial records and to broaden the powers of a special fiscal agent in the case.”
  • “Pashman Stein is free to continue representing the Uppalapati defendants, but may not also represent AM Logic, Rivas said in an order.”
  • “Tallapragada, who allegedly owns 50% of AM Logic, claims in the suit that Madhavi Uppalapati, who isthe alleged owner of the other 50%, has misappropriated $600,000 from the company and won’t let him examine the books. Uppalapati disputes Tallapragada’s ownership claims.”
  • “O’Connor said in court papers that the circumstances are similar to those in a 2014 Appellate Division case, Comando v. Nugiel. In that case, law firm Norris McLaughlin was disqualified from simultaneously representing the defendant and the business that the parties were fighting over.”
  • “O’Connor, who also represented the plaintiff in Comando, said Rivas’ ruling on Friday ‘reaffirms the Comando decision that I cited in the motion papers, which says you cannot claim that a lawyer has two masters. I see lawyers doing it all the time. Even though the court was pretty clear, I still see it coming up all the time. Trial courts are not quick to disqualify lawyers,’ he said.”

Ira L. Herman, Partner, Bankruptcy & Restructuring at Blank Rome wrote an excellent, in depth piece: “Why Bankruptcy Counsel Must Be Mindful of Ethics” —

  • “Counsel and other professionals being engaged to represent a debtor in a restructuring will often face myriad thorny conflicts and conflict-related issues. In the larger cases this is so, at least in part, because of complicated capital structures and interlocking interests.”
  • “Somewhat ironically, the conflict issues in the smaller cases often are more difficult because of the very nature of small and closely held businesses and the dollar amounts at stake in such cases.”
  • “For example, where a potential debtor is a single-member limited liability company, that single member may have guaranteed the debt of the small business, be its landlord, or have made a secured loan to the business. Additionally, small business ownership creates challenges for counsel when such entity’s interests diverge from those of its owner, who may assume that she or he is the business.”
  • “To further illustrate how these issues arise similarly in the larger and smaller cases, retainers and fees regularly are paid on behalf of a debtor by an equity sponsor or an affiliate. In the smaller business cases, friends and family — who may have previously loaned money either to the debtor or its ownership — often pay the freight.”
  • “In matters large and small, Rule 1.8(f) of the American Bar Association’s Model Rules of Professional Conduct must be consulted. A lawyer shall not accept compensation for representing a client from one other than the client unless:
    • The client gives informed consent;
    • There is no interference with the lawyer’s independence of professional judgment or with the client-lawyer relationship; and
    • Information relating to representation of a client is protected as required by Rule 1.6.”
  • “The Bankruptcy Code does not define “adverse” interest in any way. In contrast, the term “disinterested person” is defined in Section 101(14). The term “disinterested person” means a person who:
    • Is not a creditor, an equity security holder, or an insider;
    • Is not and was not, within two years before the date of the filing of the petition, a director, officer, or employee of the debtor; and
    • Does not have an interest materially adverse to the interest of the estate or of any class of creditors or equity security holders, by reason of any direct or indirect relationship to, connection with, or interest in, the debtor, for any other reason.
  • “When insiders, affiliates, friends and family show up all over a restructuring, it is a time for counsel to be mindful of the professional responsibilities as a lawyer practicing in an area of law that also has unique rules governing professional conduct.”
  • “Counsel’s inquiry cannot start with an analysis of the Bankruptcy Code and the Federal Rules of Bankruptcy Procedure.[4][5] Rather, the inquiry must start with the ethical rules found in the Model Code of Professional Conduct, including the duties of loyalty and independent judgment and to whom these duties are owed.”
Risk Update

Risk Reading Roundup — Client Identification Clarity, “Mercenary” Litigation Hacking, Supreme Ethical Wall, Crowdsourced Litigation Fees Ethics Opinion

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A Deeper Dive — Who Is the Client? The Ethics Rule Implications for In-House Counsel and Outside Counsel” —

  • “Shannon “A.J.” Singleton and Alicia Still delve into the ethical requirements for in-house counsel and outside counsel, extending the discussion of a Showcase CLE program at the ABA Business Law Section’s 2022 Hybrid Spring Meeting.”
  • “Their conversation hits on the in-house implications of ABA Model Rule of Professional Conduct 4.2, what it takes to forge relationships with colleagues on the business side and why it matters, and more.”

This is a 25 minute video discussion. The actual 90 minutes CLE presentation is accessible for ABA members. That: “…presentation explores the unique application of the Rules of Professional Conduct and other ethical requirements to the role of in-house lawyers, including client identity, conflicts, confidentiality and privilege, and business and interpersonal relations with clients. The content will also be useful to outside counsel working with in-house lawyers.”

Goodwin Walls Off Jackson’s Brother-in-Law From High Court Cases” —

  • “Justice Ketanji Brown Jackson’s brother-in-law will not receive income from his law firm Goodwin Procter’s work on cases in the US Supreme Court, the firm told the court Thursday.”
  • “William Jackson is a partner in Goodwin’s Washington office, where he focuses on health care and life sciences litigation. He does not handle Supreme Court cases, the firm said in a letter to the high court’s clerk.”
  • “Other firms have similarly opted to wall off partners with family ties to the court to avoid conflicts of interest. Goodwin’s move comes amid rising calls for the court to tighten ethics restrictions following revelations that Justice Clarence Thomas’ wife, Virginia ‘Ginni’ Thomas, was involved in a pressure campaign to overturn the 2020 election.”

One good item and one bad item for your Friday” —

  • “…the New Hampshire Bar Association has published a pretty good ethics opinion to provide guidance to lawyers that find themselves representing clients who end up seeking out crowdsourcing to help pay their legal fees in connection with matters.”
  • “…the guidance on having to be wary about (and make sure you fully counsel your client about) providing any sort of informational updates to those who provide funds whether as a “perk” or “reward” for participation or otherwise and the reminder that funds raised explicitly for the purpose of paying for legal fees and legal expenses cannot then be used to provide the client with financial assistance for living expenses if the lawyer essentially appears to be the one raising the funds or so involved in the effort to raise the funds publicly because of the prohibition in RPC 1.8(e) on lawyers offering that kind of financial assistance.”
  • “The opinion does not take the next step though of offering the relatively obvious practical advice that the most flexible way to crowdsource would always be to seek funds for a client to allow them to financially survive their circumstances without promising that all or even any of the funds would go to attorney fees. Once raised and available to the client, the client could then use them for whatever purpose they wish, including paying their lawyer.”

How mercenary hackers sway litigation battles” —

  • “A trove of thousands of email records uncovered by Reuters reveals Indian cyber mercenaries hacking parties involved in lawsuits around the world – showing how hired spies have become the secret weapon of litigants seeking an edge.”
  • “For Gupta it was just the beginning. Over the next decade, he and a small coterie of Indian colleagues built an underground hacking operation that would become a hub for private investigators, like Moser, who sought an advantage for clients embroiled in lawsuits.”
  • “Reuters identified 35 legal cases since 2013 in which Indian hackers attempted to obtain documents from one side or another of a courtroom battle by sending them password-stealing emails.”
  • “The messages were often camouflaged as innocuous communications from clients, colleagues, friends or family. They were aimed at giving the hackers access to targets’ inboxes and, ultimately, private or attorney-client privileged information.”
  • “At least 75 U.S. and European companies, three dozen advocacy and media groups and numerous Western business executives were the subjects of these hacking attempts, Reuters found.”
  • “The targets’ lawyers were often hit, too. The Indian hackers tried to break into the inboxes of some 1,000 attorneys at 108 different law firms, Reuters found.”
  • “Among the law firms targeted were global practices, including U.S.-based Baker McKenzie, Cooley and Cleary Gottlieb. Major European firms, including London’s Clyde & Co. and Geneva-based arbitration specialist LALIVE, were also hit. In 2018, the Indian hackers tried to compromise more than 80 different inboxes at Paris-based Bredin Prat alone.”
  • “One of the most prominent was WeWork co-founder Adam Neumann, who hired New York’s Seiden Law Group after learning from Reuters that he and other company executives’ email accounts were targeted by the Indian hackers starting in August 2017, according to four people familiar with the matter.”
  • “Indian mercenary hackers have worked in the shadows for at least a decade, helping private detectives get an edge in litigation, a Reuters investigation found. Now one victim – an aviation executive named Farhad Azima – is exposing the secretive industry, with potential ripple effects for legal battles on both sides of the Atlantic… ‘Millions of dollars are being made by hackers, investigators and their instructing law firms from these illegal activities,’ he said. ‘The hack-for-hire companies may be thousands of miles away, but the victims are often U.S. citizens on U.S. soil.'”

Other examples and more detail for the curious or concerned: “Dark Basin: Uncovering a Massive Hack-For-Hire Operation” —

  • “Dark Basin is a hack-for-hire group that has targeted thousands of individuals and hundreds of institutions on six continents. Targets include advocacy groups and journalists, elected and senior government officials, hedge funds, and multiple industries.”
  • “Dark Basin extensively targeted American nonprofits, including organisations working on a campaign called #ExxonKnew, which asserted that ExxonMobil hid information about climate change for decades.”
  • “Several international banks and investment firms, as well as prominent corporate law firms in the United States, Asia, and Europe, were targets. We also found a number of companies involved in offshore banking and finance were also targeted.”
  • “We found targeted individuals in many major US and global law firms. Lawyers working on corporate litigation and financial services were disproportionately represented, with targets in many countries including the US, UK, Israel, France, Belgium, Norway, Switzerland, Iceland, Kenya, and Nigeria.”
  • “Dark Basin’s activities make it clear that there is a large and likely growing hack-for-hire industry. Hack-for-hire groups enable companies to outsource activities like those described in this report, which muddies the waters and can hamper legal investigations. Previous court cases indicate that similar operations to BellTroX have contracted through a murky set of contractual, payment, and information sharing layers that may include law firms and private investigators and which allow clients a degree of deniability and distance.”
Risk Update

EY Ethics & Conflicts News — Details on Another Big 4 Accounting Conflicts Story Surface, Audit Ethics Irony

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Officials Balked at a Drug Company’s Tax Shelter. Auditors Approved It Anyway.” —

  • “Court documents show the potential conflicts of interest when accounting firms simultaneously help clients avoid taxes and audit their finances.”
  • “Consultants at the giant advisory firm EY had devised an elaborate arrangement that would allow Perrigo, one of the country’s leading makers of nonprescription drugs, to avoid more than $100 million in federal taxes. But the company’s outside auditors, at the accounting firm BDO, were questioning the setup’s propriety.”
  • “At least one EY official, too, expressed concern that the tax shelter his colleagues had designed was overly aggressive. Even so, auditors at EY, also known as Ernst & Young, eventually blessed the transactions, which federal authorities now claim were shams, according to previously unreported documents made public in a court case last year.”
  • “Even so, auditors at EY, also known as Ernst & Young, eventually blessed the transactions, which federal authorities now claim were shams, according to previously unreported documents made public in a court case last year.”
  • “Internal EY emails and memos — made public last year in a court case in which the I.R.S. is challenging Perrigo’s tax arrangements and accusing EY of constructing “an abusive tax dodge” — provide a rare inside look at the potential conflicts of interest that arise as a single firm constructs tax shelters and simultaneously audits its own work.”
  • “‘When you are a consultant, you are partnering with management. You are trying to make management look really good,’ said Lynn Turner, a former chief accountant at the Securities and Exchange Commission. ‘That’s not the role of an independent auditor.'”
  • “While conflicts of interest among accounting firms have troubled investors for decades, there are signs that the conduct of the Big 4 firms is receiving new regulatory scrutiny.”
  • “Nowhere is the tension over accounting firms’ multifaceted roles more pronounced than in the lucrative business of advising companies on how to slice their tax bills.”
  • “The Big 4 accounting firms — EY, KPMG, PwC and Deloitte — have emerged as perhaps the most powerful private-sector force in U.S. tax policy. They lobby federal officials to tweak tax rules to help their clients. A steady stream of lawyers from the firms rotate in and out of senior tax positions in the Treasury Department, where they write rules favorable to their former clients.”
  • “At the same time, the Big 4 firms help companies move profits out of the reach of the U.S. government. Then the companies’ auditors — often a different group of employees from the same firm that created the structures in the first place — have to sign off on the setups. In assessing their legitimacy and the effect on the client’s financial results, the auditors frequently consult with the colleagues who devised the tax strategies.”
  • “The I.R.S. is taking a dim view of these transactions.”

The Big 4’s Tax Problem” —

  • “How Perrigo’s tax shelter worked: In 2005, EY devised a plan to help Perrigo, then based in Allegan, Mich., avoid U.S. taxes on its popular anti-heartburn medication, omeprazole. If Perrigo had bought omeprazole from a manufacturer and then sold the pills to customers in the U.S., its profits would have been taxed there. Instead, EY advised Perrigo to set up a subsidiary in Israel, with no employees and no offices, to buy the omeprazole. The shell company then sold the pills to Perrigo in the U.S. at a profit. That meant that Perrigo’s income on the pills largely remained in Israel rather than in the U.S., out of reach of the I.R.S. And because of the vagaries of Israeli tax law, the profits weren’t taxed in Israel, either.”
  • “The I.R.S. eventually questioned the transactions and required Perrigo to pay $163 million in back taxes. In a related case, Justice Department lawyers representing the I.R.S. accused EY of enabling a “shell game” and a “flagrant tax scheme gone awry.” The fight went to a federal trial last year. The judge hasn’t announced a verdict yet.”

Ernst & Young to Pay $100 Million Fine After Auditors Cheated on Ethics Exams” —

  • “Ernst & Young, one of the world’s largest auditing firms, has agreed to pay a $100 million fine after U.S. securities regulators found that some of its auditors had cheated on ethics exams — and that the firm did not do enough to stop the practice.”
  • “The penalty is the largest ever imposed by the Securities and Exchange Commission against an auditing firm. An administrative civil order filed by regulators said Ernst — also known as EY — had misled investigators, withheld evidence and violated public accounting rules designed to maintain the integrity of the profession.”
  • “‘It’s simply outrageous that the very professionals responsible for catching cheating by clients cheated on ethics exams, of all things,’ said Gurbir S. Grewal, the commission’s director of enforcement, in announcing the settlement Tuesday.”
  • “The penalty is twice the sum that KPMG, another big audit firm, paid in 2019 to resolve an investigation into similar allegations of cheating by auditors on internal training exams.”
  • “Ernst, which admitted in the order that its conduct was wrong, said in a statement that ‘nothing is more important than our integrity and our ethics.’ The firm also said that ‘sharing answers on any assessment or exam is a violation of our Code of Conduct and is not tolerated’ and said it would take efforts to enforce compliance with ethical rules.”


jobs (listed)

BRB Risk Jobs Board — Client Intake Manager

Posted on

Our next BRB job post comes from Danny Cho, Senior Manager Client Intake at Mintz. He’s hiring a “Client Intake Manager” for his team.

This position is based in Boston, and they’re looking for someone with a JD with experience managing the staff of a mid-sized conflicts or new business intake department at a law firm or equivalent:

  • “The Client Intake Department is principally responsible for responding to requests for conflict checks associated with prospective new clients, new matters, potential lateral attorneys and support staff candidates, and other related matters. The Department is also responsible for maintaining accurate records regarding the above matters and monitoring compliance with related best practices and policies throughout the lifecycle of each such matter.”
  • “The Client Intake Manager will be responsible for supervising the day-to-day operations of the Department. The Client Intake Manager ensures all such requests submitted to the Department are responded to promptly and within stated time frames by Department staff, provides direct supervision to Department staff in the fulfilment of these requests, and monitors compliance with all firm policies, procedures, and best practices.”

Key Responsibilities Include:

  • Manage and oversee day-to-day operations of the Firm’s Client Intake Department.
  • Develop, manage and lead a growing team of direct reports.
  • Supervise the review of requests submitted to the Department to ensure information provided is accurate, complete, and compliant with Firm policies and best practices.
  • Supervise the Department’s processing of submitted requests to ensure compliance with Firm policies, best practices, and the Department’s own expectations.
  • Supervise the Department’s processing of conflict checks related to potential lateral attorneys and support staff candidates.
  • Conduct conflicts-related training of lateral attorneys.
  • Create and maintain information walls and screens.
  • Supervise conflict and intake records creation and maintenance and manage related data flow and systems.
  • Resolve records, data flow, and systems issues as they arise.
  • Supervise the testing and implementation of new systems, as needed.
  • Participate in the training and professional development of Department staff.
  • Manage the team’s PTO requests, performance reviews, distribution of work, and staffing levels.
  • Assist in the development of forward-looking intake policies and procedures, including by staying current with industry trends and evolving best practices, and coordinating and conducting training of attorneys and assistants regarding the same.
  • Implement improvements to reporting, clearance, data collection, and maintenance processes for both laterals and new business intake; collect, analyze, and report information from the conflicts team to assist in developing best practices and procedures.
  • Work closely with partners to identify and effectively process to conclusion potential conflict and intake issues and certain limited professional responsibility matters, as requested.
  • Handle special projects, as requested.
  • This role requires 60% in office presence; remote work is permissible 40% of the time.

See the complete job posting for more detail on job and to apply.

Learn more about working at Mintz on their careers page:

  • “We know that any organization is only as good as its people, and we expect the best from ours. Whether you recently passed the bar, are looking for a change later in your career, or possess gifts in administration, we want you to succeed. You win, we win: it’s that simple. So, what do you care about? How would you like to be challenged? We will ask; come prepared with your answers.”
  • “We recognize that the firm’s success is dependent on having high-quality professionals in every position. Our staff members are vital contributors to the delivery of outstanding legal services. We seek talented and driven individuals who are committed to producing exceptional work, and providing critical support to our attorneys. Our environment offers collegiality, intellectual curiosity, teamwork, and an opportunity to grow professionally. We encourage enthusiasm, take pride in our work, and reap the benefits of working with a great group of colleagues.”

And if you’re interested in seeing your firm’s listings here, please feel free to reach out