Risk Update

Conflicts, Compliance & AML — German Legal Reforms in Force, Anti-money Laundering Developments in US (Rules) and UK (SRA Fines)

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Professional regulation of lawyers and law firms in Germany: Comprehensive reform comes into force” –

  • “Almost two years after the publication of the draft legislation, the reform of the professional regulation of lawyers and law firms in Germany comes into force today. The reform brings significant changes regarding greater freedom of organisation under company law for law firms and regarding the regulation of law firms.”
  • “Foreign law firms also benefit from the reform of the Federal Lawyers’ Act, as it expands their freedom to act within the scope of their activities in Germany, subject to compliance with certain requirements. However, the increased requirements for admission in Germany and compliance with professional duties must be considered.”
  • “Foreign law firms that have their registered office in the UK, the USA or any other member state of the World Trade Organization may also provide legal services in Germany under certain conditions (Section 207a Federal Lawyers’ Act).”
  • “The reform of the Federal Lawyers’ Act also introduces some innovations in the structure of professional service firms. For example, professional service firms as legal entities can now themselves be partners in other professional service firms, provided that both entities meet the requirements of professional law.”
  • “The previous requirement that a majority of the partners should be lawyers is now dropped due to the other guarantee of compliance with professional duties, in particular through Section 59d Federal Lawyer’s Act. However, the reform still does not permit a pure capital participation in a professional service firm. In this respect, it remains to be seen whether the legislator will act again in the current legislative period and relax the prohibition on third-party ownership that has continued to apply up to now.”
  • “Whereas current professional law and regulation solely apply to individual professionals, the Federal Lawyer’s Act now introduces a dualistic approach which is more in line with practice outside of Germany: in the future, the entity through which the individual professionals exercise their profession will also be subject to regulatory requirements and have professional duties of its own.”
  • “The other side of the coin is that, under the Act, a law firm will be obliged to ensure the adherence of its professionals to their individual professional duties. Law firms will have to ensure through their management boards and, where appropriate, through their supervisory boards that violations of professional obligations are detected at an early stage. The firm must provide appropriate mechanisms for this purpose.”
  • “In cases of violations of the law firm’s regulatory obligations, particularly its culpable omission to put in place appropriate organisational, personnel and technical measures, the law firm itself can be sanctioned (Section 113 Federal Lawyers’ Act). According to Section 114 para 2 Federal Lawyers’ Act, sanctions can range from warnings to fines of up to EUR 500,000 or in a worst-case scenario to disqualifying the law firm from providing legal services.”
  • “One of the core pieces of the reform is the new regulation of the provisions on lawyers’ conflicts of interest… What remains unchanged is that the scope of application extends to all lawyers and legal staff of the entire law firm. The prohibition on the entire law firm acting can now be lifted, but the individual lawyer cannot be exempted from it. Where it is lifted (such that another lawyer from the same firm can act), the new provisions stipulate the appropriate precautions which must be taken to maintain confidentiality.”

Update: Congress Seeks To Impose Some AML Obligations On CPAs, Law Firms, And Others” –

  • “On July 7, 2022, Arnold & Porter published an Advisory on the Establishing New Authorities for Businesses Laundering and Enabling Risks to Security Act (ENABLERS Act) that was attached to the National Defense Authorization Act (NDAA) on June 23, 2022. Since the previous Advisory, the House has made substantial amendments to the ENABLERS Act, particularly with respect to the categories of professions that would be subject to the due diligence and reporting obligations under the Bank Secrecy Act. This Advisory highlights the recent amendments.”
  • “The amendment removes attorneys, law firms, or notaries involved in financial or related activity on behalf of another person, as well as certified public accountants, and public accounting firms from the list of covered professions;”
  • “The key takeaway from the amendment is that the Act’s focus has shifted to the relevant services rather than professions as a whole. For example, rather than impose BSA requirements on any attorney or law firm involved in financial activity on behalf of another person (as proposed in the June 23, 2022, version of the ENABLERS Act), the amended Act would impose BSA requirements only on those attorneys or law firms providing legal entity arrangement, association, or formation services; trust services; or third-party payment services; that is, the types of services that potentially create the transparency concerns that the ENABLERS Act seeks to address. This shift avoids some of the concerning implications we raised in our previous Advisory.”
  • “Second, the rule of construction provision provides that privilege, ethics, confidentiality, privacy, or related matters should not limit or impede the covered parties’ obligation to comply with the Act. FinCEN would need to address how lawyers and certified public accountants could address AML program reporting obligations without jeopardizing their respective ethical duties of confidentiality and other professional conduct responsibilities to their clients. And with the extraterritoriality provision, the dilemma also would arise for foreign professional, who are subject to their own professional responsibility requirements. The implication of this provision is that compliance with federal obligations should win out over other territorial, state, and local laws when a conflict arises between a lawyer or accountant’s obligations.”

Number of law firms fined by SRA increases following anti-money laundering compliance crackdown” —

  • “The number of fines against law firms, handed out by the UK’s solicitors’ watchdog, has increased six-fold over the past five years following an anti-money laundering compliance crackdown, according to data obtained by City A.M.”
  • “The Solicitors Regulation Authority (SRA), which regulates more than 11,000 law firms in England and Wales, gave out just six fines in the financial year 2017/18 compared to 37 in 2021/22.”
  • “The uptick in fines came after the SRA launched a clampdown on firms that had fallen behind on their anti-money laundering obligations, after new rules were introduced in 2017.”
  • “The clampdown – which saw the SRA ask every law firm that it regulates to declare that they had a firm-wide risk assessment in place to help prevent and detect money laundering by January 2020 – led to 23 law firms being fined for anti-money laundering failures last year.”
  • “The two enforcement sweeps saw the SRA review firms’ compliance with anti-money laundering standards, and check whether firms were breaching transparency rules, which require law firms to publish basic information about complaints, and the prices of certain services, for example.”
  • “However, Andrew Pavlovic, a partner at law firm CM Murray, argued the SRA’s ‘focus on organisations is likely to continue’ as the watchdog finds itself tasked with ensuring law firms’ compliance with sanctions that were introduced following Russia’s invasion of Ukraine.”
  • “The total value of fines issued against law firms more than tripled in five years, from £87,000 in 2017/18 to £299,925 last year. But the total value fines against firms last year is heavily skewed after law firm Mishcon de Reya was hit with a £232,500 fine for anti-money laundering failures, which were not picked up as part of the sector sweep.”
Risk Update

Risk News — Disqualification Dispute, Poached Partner Lateral Subpoena Fight, CA/SF DA Ethical Wall Debate

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Worker Fights AutoZone’s Bid To DQ Atty In Bias Suit” —

  • “A former AutoZone employee suing the company for discrimination has told a Pennsylvania federal judge that his lawyer’s reference to a previous confidential settlement, which the auto parts retailer claims is grounds for disqualification, was necessary to prove the company was retaliating against him for protected activity.”
  • “AutoZone argued in a July 15 motion to disqualify that the reveal of the confidential settlement by David Koller, Newman’s attorney, in filing a second claim alleging retaliation was not only a breach of that contract but also revealed a conflict of interest between Koller and his client.”
  • “But Koller argued in a motion in opposition Thursday it was necessary to reveal the parties had agreed to a settlement because any monetary aspect of the agreement could be evidence of AutoZone’s motive to retaliate against Newman for his second challenge. Koller also noted the settlement agreement had a clause stating the agreement itself couldn’t prevent Newman’s additional court filings with the employment commission.”
  • “‘There is no issue of joint representation where interests of co-parties could conflict,’ the motion said. ‘There has been no actual harm to date. Plaintiff may yet prevail in his defense against the counterclaim and to permit any defendant to argue for disqualification because a plaintiff may have received bad legal advice is to grossly misstate and warp the rules of professional conduct.'”

Jones Day’s Subpoena of Orrick Over Poached Partner Must Be Enforced, Court Rules” —

  • “Judges Kim Wardlaw, Sandra Ikuta and Bridget Bade reversed a district court order that denied Jones Days’ petitions to compel Orrick to comply with a summons, which stemmed from international arbitration Jones Day commenced against one of its partners in its Paris office, who allegedly violated an agreement when he left the firm for Orrick in 2019.”
  • “The central issue on appeal was whether the federal trial court in California has the power to enforce the subpoena against Orrick, a third-party in the dispute, even though the District of Columbia is the designated ‘seat’ in Jones Days’ arbitration agreement with the ex-partner. “
  • “According to a court order, former Jones Day partner Michael Bühler negotiated his employment with Orrick around the time he was also representing a Jones Day client before an arbitral tribunal, of which an Orrick attorney was a member. Jones Day said Bühler didn’t inform the firm of the conflict of interest. The Orrick arbitrator was eventually replaced, but Jones Day’s client wanted the firm to pay for the costs of the delayed proceedings.”

State Won’t Take Charge of Criminal Cases Involving Mayor Breed’s Brother and DA Brooke Jenkins’ Family

  • “The California Attorney General’s Office declined to take over two controversial cases in which San Francisco District Attorney Brooke Jenkins raised concerns about potential conflicts of interests.”
  • “Hours after taking office as San Francisco’s District Attorney on July 8, Brooke Jenkins’ office sought to have two cases transferred to another jurisdiction because of a potential conflict she feared would tarnish her public image.”
  • “One case involves Mayor London Breed’s brother Napoleon Brown and the other stems from charges against two men accused of killing Jerome Mallory, the cousin of Jenkins’ husband.”
  • “‘My stance has not changed and I will continue to have no involvement in either case to avoid any appearance whatsoever of a conflict,’ Jenkins said. ‘I am exploring whether other local agencies may be an option. Regardless, these cases will be handled according to the law and with integrity.'”
  • “‘There has been nothing to suggest that she is not fulfilling that ethical duty,’ the AG’s letter read. ‘Nevertheless, out of an abundance of caution, and under your guidance, DA Jenkins has been walled off from Mr. Brown’s case to avoid any public perception of a conflict of interest.'”
  • “But Pam Herzig, who represents Mitchell, contends that there remains enough of a conflict of interest that the district attorney’s office should not prosecute the case. The larger issue, according to Herzig, was that Jenkins publicly spoke about the case as she campaigned for the ultimately successful recall of her former boss, District Attorney Chesa Boudin.”
  • “The letter doesn’t describe accurately the issues of the conflict of interest, Herzig contends, adding that it specifically did not mention Jenkins’ repeated statements about the case.”
  • “‘Her opinions as to charging decisions and appropriate punishment are in the public record,” Herzig said. “It is impossible to see how ‘walling’ her off from the case resolves that conflict, as her deputies have been made aware of her position. The letter does not address that in any way.'”
Risk Update

Conflicts Tales — Discovery Rules Violation + Conflict = Disqualification Fight, Anti-Semitic Client Communication + Conflict = Suspension

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Firm Faces Threat of Disqualification After Appeals Court Says It Violated Discovery Rules” —

  • “A firm defending an anesthesiologist in a malpractice suit faces possible disqualification from the case for its work representing a non-party doctor who gave deposition testimony in the matter.”
  • “The Superior Court determined Scranton firm Scanlon, Howley & Doherty violated a rule limiting the discovery of parties’ treating physicians when it took on the plaintiff’s surgeon as a client.”
  • “Senior Judge Dan Pellegrini said the firm ran afoul of the rule by engaging in ex parte communication with surgeon Dr. Eugene Kim.”
  • “According to the opinion, Oh signed a waiver of potential conflict of interest upon retaining Scanlon Howley, and Hayes sent a letter to opposing counsel informing them of the representation. Plaintiffs counsel Angelo Theodosopoulos of Messa & Associates did not raise concerns about a conflict until approximately six months after Hayes sent the letter, at which point Theodosopoulos said Scanlon Howley had never been authorized to speak with Kim, the opinion said.”

Anti-Semitic Letter, Conflict Draws Indefinite Suspension” —

  • “The Maryland Court of Appeals has indefinitely suspended an attorney for a conflict of interest and because she had ‘…sent an antisemitic and highly offensive 20-page letter to a client and then later knowingly and intentionally misrepresented to Bar Counsel that she had sent the letter by mistake..”
  • Attorney Grievance Commission of Maryland v. Amber Lisa Maiden:
    • “Ms. Maiden created a conflict of interest by making herself a co-claimant along with Mr. Riese for the purpose of asserting a cause of action under 42 U.S.C. § 1981…”
    • “Ms. Maiden also created a conflict of interest by claiming a 50% share of any punitive damages Mr. Riese might obtain. Although a “reasonable contingent fee,” “subject to Rule []1.5,” is permitted as an exception to the general rule prohibiting an attorney from acquiring a proprietary interest in a cause of action, Md. Rule 1.8(i)(2), Ms. Maiden’s demand for a 50% share of any punitive damages award was premised at least in part on her status as a co-claimant with Mr. Riese—and her stated belief that she was a more appropriate recipient of those damages than he was—not on her legal work. Ms. Maiden thus violated Rules 1.7 and 1.8(i) by creating a conflict of interest without obtaining Mr. Riese’s written informed consent.”
    • “With respect to the antisemitic and highly offensive nature of Ms. Maiden’s statements, the excerpts recited above speak for themselves. The 20-page letter is laced with statements that are offensive, demeaning, personally insulting, profane, and premised on harmful religious, racial, and ethnic stereotypes.”
    • “The Commission recommends that Ms. Maiden be indefinitely suspended from the practice of law. Ms. Maiden neither responded to that recommendation nor offered a contrary recommendation.”
    • “Ms. Maiden’s conduct was brief in time but extensive in volume and severity, and her offensive statements were sent to and intended to be read by their subject, who was also her client. It is also notable that neither Basinger nor Markey involved other violations, such as the significant conflict-of-interest, competence, and dishonesty violations at issue here, which further call into question Ms. Maiden’s fitness to represent clients at this time.”
Risk Update

Conflicts Allegations — Judge Conflict Accusation Quashed, Arbitrator Conflict Argument Invalidated

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Texas Attorneys Avoid Lawsuit Over Gas-Technology Settlement” —

  • “After Betty died in 2012, her daughter Carol Sousa disputed the [IP licensing] agreement between the law firms and her mother in a state trial court, alleging that the law firms had taken advantage of her mother… The trial court therefore affirmed the parties’ arbitration award and granted attorneys’ fees.”
  • “Sousa argued on appeal that the arbitrator had a conflict of interest, because he had a prior business relationship with Wilson Elser, the law firm representing the IP attorneys. Sousa alleged that the arbitrator signed a false arbitrator oath.”
  • “The appeals court said Thursday there was no evidence of the arbitrator’s disqualification because he disclosed the relationship in his oath. The arbitrator disclosed that he had conducted 11 mediations involving seven attorneys who were associated with Wilson Elser from 2006-2019.”
  • “These disclosures were made after the arbitrator’s appointment, but before his confirmation and before any proceedings in the arbitration began, the court said.”
    “Sousa previously alleged the arbitrator refused to hear material evidence and allow cross-examination. But the court found no evidence of actual bias at the hearing, with the court saying her ‘arguments aren’t consistent with the record.'”
  • “‘Sousa offers a long list of complaints but offers little discussion or explanation as to how the excluded evidence was material and therefore its exclusion deprived her of a fair hearing,’ the court said. The appeals court affirmed the judgment of the trial court.

Abbott Labs’ Judge Choice Leads To JPML Conflict Questions” —

  • “The Judicial Panel on Multidistrict Litigation raised no red flags Thursday about consolidating 18 lawsuits alleging that Abbott Laboratories’ Similac infant formula caused a deadly illness in premature babies, but at a Seattle hearing the panel questioned whether Abbott’s choice of judge has an appearance of conflict because he once represented the company.”
  • “The six-judge panel heard attorneys for the plaintiffs and Abbott argue in support of consolidating the cases currently in federal courts in six states. The judges peppered Abbott attorney James Hurst of Kirkland & Ellis LLP with questions about Abbott’s choice of U.S. District Judge John F. Kness, who represented Abbott in a lawsuit prior to joining the bench in 2020.”
  • “Hurst said more than 15 years has passed since Judge Kness represented Abbott in a lawsuit related to an explosion at a pharmaceutical plant, which makes it implausible that the judge would still have any allegiance to the company.”
  • “U.S. District Judge Madeline Cox Arleo challenged Hurst, noting that Judge Kness has listed his Abbott representation as one of the most significant cases he handled in his career.”
  • “‘Judge Kness’ extensive, personal handling of significant litigated matters on behalf of Abbott invites the appearance of bias. While no motion for recusal has been filed, issues surrounding such representation may introduce unnecessary delay and inefficiency to the litigation,’ according to a brief filed by plaintiff Arturo Andaluz.”

BRB Risk Jobs Board — Conflicts Analyst

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In this BRB jobs update, I’m pleased to highlight an open conflicts role at Williams & Connolly’s Washington, DC office: “Conflicts Analyst” —

Responsibilities of the position include, but are not limited to:

  • Primary responsibility to process and analyze all incoming new client and new matter workflow requests and analyze conflict check reports on a daily basis to determine any direct or potential conflicts, including potential conflicts for all incoming employees as needed, in a timely, efficient, and accurate manner;
  • Data entry, search and analysis using Williams & Connolly’s new business conflicts and intake databases;
  • Assist in retrieval, review and retention of current retainer agreements, outside counsel guidelines and other forms with ethics rules and opinions;
  • Provide and decipher Corporate Family Tree information;
  • Provide conflicts information to requesting attorneys, Conflicts Attorney, Professional Responsibility and Risk Management Counsel and the Ethics Committee;
  • Provide status of new client matters;
  • Produce Conflicts Checks or New Matter Forms by Proxy;
  • Handle numerous calls and emails as they relate to Conflicts and New
    Client Matters;
  • Provide time sensitive Securities Information to the Corporate Group as it relates to performing current client checks for Selling/Trading as needed; and
  • Assist with a wide range of research and other requests as necessary.

Key qualifications include:

  • The ideal candidate will have an interest in the law, and in particular, experience with conflicts and the Rules of Professional Conduct.
  • The candidate must have the ability to work independently and yet still effectively communicate with others and use the utmost care in the handling of confidential information.
  • This position requires the ability to interface with firm management, partners, and employees in a highly professional manner, and the ability to manage and prioritize a high volume of work activities meeting all deadlines
  • The ideal candidate also will possess legal experience in conflicts and/or new business intake. Knowledge of, and experience working with the Intapp suite of new business products preferred including Conflicts/New Business.
  • The position requires a Bachelor’s Degree. Flexible workweek scheduling/hoteling potential.

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

Learn more about working at Williams and Connolly on their careers page:

  • “At Williams & Connolly, a high percentage of our support staff members have been with the firm for more than a decade. They have been given the opportunity to develop their careers through promotions, increased responsibility, and internal mobility because we know that our professional talent is every bit as important as our lawyers in providing quality service to our clients.”
  • “The firm offers competitive compensation, outstanding benefits and professional growth opportunities with the sincere anticipation that Williams & Connolly will be a place for our staff to enjoy a challenging career for many years to come.”
  • “Washingtonian magazine again selected the firm as one of the Washington D.C. area’s 50 “Great Places to Work.” Our interesting cases, opportunity to work with the most talented lawyers in the world, team spirit, excellent professional rewards, and other notable perks landed us among the featured companies.”

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

Risk Update

Former Client Conflicts — Ex-client Lawyer Conflicts Claims Causing Contentious Clashes

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3rd Circ. Vacates Grant of Summary Judgment for Attorney on Ex-Client’s Breach-of-Fiduciary Claim” —

  • “The U.S. Court of Appeals for the Third Circuit has reinstated a lawsuit alleging a Pennsylvania attorney breached her fiduciary duty by representing a plaintiff in a claim against one of her former clients.”
  • “Lycoming Engines sued its former attorney on claims of breach of fiduciary duty seeking damages, disgorgement, and declaratory relief after she represented plaintiffs in Torres v. Honeywell Inc., a case involving an engine manufactured by the company, according to the Third Circuit’s July 22 opinion.” https://www2.ca3.uscourts.gov/opinarch/212750np.pdf
  • “‘The type of injury a plaintiff must establish, however, depends on the type of remedy sought,’ stated Judge D. Michael Fisher in his written opinion for the court. ‘We consider, in turn, the kinds of monetary remedies at issue: disgorgement, compensatory damages, attorney’s fees and costs, and nominal damages.'”
  • “Fisher laid out the plaintiff’s burden of proof in a claim of breach of fiduciary duty: ‘(1) a fiduciary relationship existed, (2) the defendant ‘negligently or intentionally failed to act in good faith and solely for [the plaintiff’s] benefit,’ and (3) the breach caused an injury to the plaintiff.'”
  • “Fisher cited Maritrans GP Inc. v. Pepper, Hamilton & Scheetz, a Pennsylvania Supreme Court opinion that stated, ‘[c]ourts throughout the country have ordered the disgorgement of fees paid or the forfeiture of fees owed to attorneys who have breached their fiduciary duties to their clients by engaging in impermissible conflicts of interests.'”
  • “‘In other words,’ stated Fisher, ‘an attorney may not argue that she should be paid because her conflict of interest did not hurt her client.'”
  • “Fisher further agreed with the district court finding that Avco cannot recover attorney’s fees as compensatory damages citing the American Rule: ‘in this Commonwealth, a litigant cannot recover counsel fees from an adverse party unless there is express statutory authorization, a clear agreement of the parties, or some other established exception.’ According to Fisher, the Pennsylvania Supreme Court has consistently upheld that rule.”
  • “Avco introduced, on appeal, that breach of fiduciary duty by an attorney entitles nominal damages, according to the opinion. Fisher, in his dismissal of that claim, stated a nominal damages claim appeared in neither the complaint nor at summary judgement. Since Avco made no argument for exceptional circumstances, it cannot be asserted for the first time on appeal.”

Firm’s Prior Work For Defendant Doesn’t Amount To Conflict” —

  • “A Tulsa, Oklahoma-based law firm’s previous work for a man doesn’t mean the firm should be barred from representing a couple who sued him after he developed a marijuana farm near their property, a judge found Tuesday.”
  • “Bacon, meanwhile, accused GableGotwals, the firm representing the Grants, of harboring a conflict of interest in the case because an attorney with the firm previously represented him in a separate case. He moved for the firm to be removed from the case in April.”
  • “Magistrate Judge Christine D. Little, however, found that there was no evidence GableGotwals had done any work for Bacon after wrapping up the lawsuit over the loan agreement in 2019. The judge lifted a stay issued in late March in her decision, allowing the Grant’s claims to proceed.”
  • “‘The evidence indicates that the attorney-client relationship terminated well before GableGotwals contacted Bacon on behalf of the plaintiffs in this case,’ according to the judge’s decision.”
  • “Bacon claimed to be bewildered when he learned in August an attorney with GableGotwals was suing him over his marijuana operation. An attorney with the firm previously represented Bacon in a case over a 2015 stock purchase agreement, and Bacon argued he thought the firm still worked for him when the Grants sued over the marijuana farm.”
  • “GableGotwals’ involvement, Bacon argued, amounts to a violation of the Oklahoma Rules of Professional Conduct, which sets a standard for how attorneys must work in Oklahoma federal courts. He argued the firm had access to information about his disaster restoration business that the Grants could use in their case against him.”
  • “The judge, however, found Bacon had failed to show GableGotwals had any information that would help the Grants. The judge also dismissed Bacon’s argument that the Grants filed suit in the first place because GableGotwals knew his net worth and what assets he held.”
Risk Update

Risk News — Side-switching Success? Lawyer “Dabblers” Create Discipline “Nightmares”

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11th Circ. Won’t Nix $40M Arbitral Award Over Conflict Claims” —

  • “The Eleventh Circuit affirmed a $40 million arbitral award in an oil refinery construction dispute that involved an attorney switching sides during arbitration, with the judges noting Friday that the losing side improperly waited more than a year before objecting.”
  • “In a 15-page opinion, a three-judge panel sided with a Florida federal court’s decision to grant the $40 million award, agreeing with its finding that the rule otherwise would allow one party to ‘keep a proverbial ace up its sleeve.'”
  • “The decision follows the tenor of oral arguments held in Atlanta a week ago, where Chief U.S. Circuit Judge William H. Pryor Jr. said Peruvian construction company Tecnicas Reunidas de Talara SAC, or TRT, was fully aware during the arbitration with a subcontractor that one of its lead attorneys in the matter joined the law firm representing the subcontractor in the dispute.”
  • “‘Because Técnicas Reunidas de Talara SAC, the losing party in the arbitration, had knowledge of the attorney side-switching but did not object until Técnicas received an adverse award more than a year later, Técnicas waived its right to complain,’ the appeals court ruled on Friday. ‘We affirm the judgment confirming the arbitral award.'”
  • “TRT further raised three arguments for why it did not waive the public-policy violation, but the panel determined they all fail. In particular TRT tried to argue that it had no avenue to challenge the side-switching during arbitration, and that it could only raise its defense during the award-enforcement stage.”

Lawyers Who “Dabble” In USPTO Trademark Matters Face Nightmare Of OED Ethics Investigations, Discipline” —

  • “The USPTO’s Office of Enrollment and Discipline has become increasingly active in the last several years, particularly in investigating business or general practice attorneys who dabble in trademark law. Many have learned the hard way–through an ethics inquiry and possible disciplinary decisions–regarding the intricacies and nuances of practice before the USPTO in trademark matters.”
  • “A ‘dabbler,’ almost by definition, is dangerous–at least in the sense that he or she has not invested the hours, days and years of regular engagement to achieve mastery of a particular area of law. “
  • “There is nothing, of course, per se wrong with ‘dabbling,’ provided the lawyer provides competent legal representation. Dabblers must answer the question: Even though I may have never done this before, or have only done this service once in a while, do I have (or can I get) the knowledge, education, skill and training to provide the service that is asked of me, and to otherwise accomplish the objectives of my client, all at a reasonable fee (among my other ethical obligations)?
  • “Trademarks and copyright applications, on the other hand, present differently. At first blush, they appear relatively simple… Some lawyers are deceived by the apparent simplicity of those form-based filing practices. The truly complexities often do not become apparent until the application is examined and the Office issues a lengthy office action with multiple unexpected rejections. The dabbler may find themselves looking down a barrel of rejections they barely understand and asking a lot of questions for which they have no answers.”
  • “An attorney who appears before the USPTO is subject to discipline by at least two different authorities: (1) the USPTO’s Office of Enrollment and Discipline; and (2) the state bar (or bars) in which the attorney is admitted.”
  • “But sadly, that attitude fails to account for the fact that each disciplinary jurisdiction in the United States gives full faith and credit to the disciplinary decisions of every other authority. And it is a violation of the rules of professional conduct in any state for an attorney to be disciplined by another jurisdiction. Thus, a license suspension from the USPTO will not just cause the attorney to lose his or her ability to practice before the agency. It could impact their state law license too.”